Alliance Hails New Legislation Seeking to Unleash the Power of ESPCs and UESCs to Lower Federal Energy Costs

Release Date: Thursday, September 18, 2014

Today identical, bi-partisan House and Senate resolutions were introduced urging a change in the current Congressional scoring practices used to evaluate legislation related to energy efficiency performance contracts. The Alliance applauds the authors of the legislation -- Alliance Honorary Vice-Chair Chris Coons (D-DE), Senator John Hoeven (R-ND), Alliance Honorary Vice-Chair Peter Welch (D-VT) and Congressman Cory Gardner (R-CO) as well as 45 other members of Congress --  for seeking to unleash the power of energy efficiency performance contracts to save the American taxpayers money on federal energy bills. 

Energy Savings Performance Contracts (ESPCs) and Utility Energy Service Contracts (UESCs) are proven and cost-effective financing tools that federal agencies use to reduce energy consumption and associated costs, but changes in the CBO scoring process in 2002 has deterred attempts by Congress to encourage, support or require the use of ESPCs and UESCs by law as such measures will receive a cost“score”notwithstanding the fact that such contracts actually save money. The legislation introduced today encourages a change that would ensure that not only the costs of ESPCS and UESCs are counted when“scoring”legislation but also the savings.

Since inception, there have been approximately $4 billion in ESPC projects across the federal government which have achieved over $13 billion in energy savings. Similarly, federal agencies have invested $2.3 billion in UESCs since 1995, covering nearly 2,000 projects. And there is an opportunity to do much more.  A government-wide audit of about ½ of its facilities has uncovered at least $9 billion in additional savings that could be realized through such contracts within the next decade.   

“The authors of the resolutions recognize that ESPCs and UESCs are important but significantly underutilized tools for improving federal energy performance, said Alliance president Kateri Callahan, adding “These congressional leaders are to be commended for seeking to correct a flaw in the cost-scoring of ESPCs and UESCs that will drive greater use of these financial tools that save American taxpayers money.”