Report, Beyond Guaranteed Savings

In a 2013 report, Oak Ridge National Laboratory reports that ESPCs commonly underestimate the amount of savings that actually accrues to site owners due to deep energy efficiency retrofits. This is due to the ESCO not guaranteeing 100% of expected savings, the useful life of equipment extending beyond the contract term, historically conservative projections for energy price escalation, and under-accounting for the depreciation of existing equipment in the baseline scenario.