Feds stand behind energy savings performance contracts

Federal leaders on Friday emphasized their support for using energy savings performance contracts to meet efficiency requirements, but told industry leaders they must work together to improve management and oversight of such contracts.

Energy savings performance contracts, or ESPCs, allow agencies to invest in green building upgrades with little upfront cost: companies finance the improvements in exchange for a share of the savings from reduced energy consumption.

"The issue of energy efficiency has never been more relevant for the federal government," said Richard Kidd, program manager for the Federal Energy Management Program at the Energy Department, in an address to members of the National Association of Energy Service Companies in Washington.

Recent laws have put tremendous pressure on agencies to reduce petroleum, water and electricity consumption, and in October 2009 President Obama signed Executive Order 13514, which required agencies to measure and reduce greenhouse gas emissions as well.

But an inspector general analysis of Energy Department ESPC contracts in September found that much of the savings stipulated in the contracts could not be verified, and in some cases equipment installed under the pacts was not being maintained. Some contracts were in such disarray that the department continued to pay for energy savings in four buildings that had been demolished.

"We went back and visited all the DOE sites and found that people involved in development [of the ESPC contracts] were no longer there, and new people were not [knowledgeable] about the contracts," said Ab Ream, a technology program specialist at Energy who spoke to the industry executives.

"It was a huge effort," Ream said, adding that both government and industry officials must perform better. Improving the way energy savings are measured and verified will be central to restoring confidence in the contracts, he said.

Federal officials want future ESPC deals to take a more comprehensive approach to improving efficiency, Kidd said. For example, while it may be worthwhile to upgrade to a more efficient heating system, if heat is escaping through a leaky roof, then those benefits will be minimal.

In addition, Energy wants ESPC contracts to embrace more new technologies being financed through agency laboratories, Kidd said.

Industry officials expressed some concern about whether federal contracting officials were ready to embrace more comprehensive ESPC contracts in the way Kidd described, and wondered how receptive they would be to adopting new technologies. Kidd acknowledged Energy and Obama administration officials must do a better job of training agency contract professionals in making the best use of the tool.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Going Agile:Revolutionizing Federal Digital Services Delivery

    Here’s one indication that times have changed: Harriet Tubman is going to be the next face of the twenty dollar bill. Another sign of change? The way in which the federal government arrived at that decision.

    Download
  • Cyber Risk Report: Cybercrime Trends from 2016

    In our first half 2016 cyber trends report, SurfWatch Labs threat intelligence analysts noted one key theme – the interconnected nature of cybercrime – and the second half of the year saw organizations continuing to struggle with that reality. The number of potential cyber threats, the pool of already compromised information, and the ease of finding increasingly sophisticated cybercriminal tools continued to snowball throughout the year.

    Download
  • Featured Content from RSA Conference: Dissed by NIST

    Learn more about the latest draft of the U.S. National Institute of Standards and Technology guidance document on authentication and lifecycle management.

    Download
  • GBC Issue Brief: The Future of 9-1-1

    A Look Into the Next Generation of Emergency Services

    Download
  • GBC Survey Report: Securing the Perimeters

    A candid survey on cybersecurity in state and local governments

    Download
  • The New IP: Moving Government Agencies Toward the Network of The Future

    Federal IT managers are looking to modernize legacy network infrastructures that are taxed by growing demands from mobile devices, video, vast amounts of data, and more. This issue brief discusses the federal government network landscape, as well as market, financial force drivers for network modernization.

    Download
  • eBook: State & Local Cybersecurity

    CenturyLink is committed to helping state and local governments meet their cybersecurity challenges. Towards that end, CenturyLink commissioned a study from the Government Business Council that looked at the perceptions, attitudes and experiences of state and local leaders around the cybersecurity issue. The results were surprising in a number of ways. Learn more about their findings and the ways in which state and local governments can combat cybersecurity threats with this eBook.

    Download

When you download a report, your information may be shared with the underwriters of that document.