The Trib’s reporter on JCI made it clear to me that the School Board’s contract with JCI was not a “performance contract.” Apparently Sarah was well aware of the criticism leveled at such contracts. They guarantee the purchaser energy savings after the installation of energy saving and monitoring equipment.
Even though the Red Plan is not an energy savings plan it has been sold to the public as an energy saving plan. Many of the first millions of dollars spent this summer are being spent on energy equipment at Stowe and Lakewood. Consequently the effect of the Red Plan is very similar to an energy performance contract. Thus what the GAO (the Goverment Accounting Office) has to say about such contracts is worth pondering. This comes from a Wikepedia entry on ESCOs.
“In June of 2005, the GAO released a report, “Energy Savings: Performance Contracts Offer Benefits, But Vigilance Is Needed To Protect Government Interests.” The Office of the Under Secretary of Defense for Technology, Acquisition, and Logistics agreed with the GAO findings. “While these complicated contracts are structured to ensure that savings will exceed costs,” the DOD noted, “we recognize that our measurement and verification procedures must be improved to confirm estimates with actual data.” Unverified savings, often stipulated rather than proven, do not put more oil in the ground, take CO2 out of the air or reduce operating budgets
The GAO ESPC study brings into question whether or not there is sufficient data to prove that the gains delivered by ESCOs are sustainable over time. The study further questions the practice of having ESCOs monitoring and validating the performance of their own projects.
In fact, most buildings and facilities exhibit the same basic limitations with respect to energy conservation and optimum maintenance. US Federal studies show that major and minor building systems routinely fail to meet performance expectations, and these faults often go unnoticed over time. The functions of a building, the number of tenants, and the configuration of the space change over time in unanticipated manners that adversely affect the systems that control building performance.
Surprisingly, almost all buildings, building complexes, and systems inside buildings still operate in a disconnected, stand-alone manner. Proprietary systems result in buildings that needlesly waste energy. Recent studies have found that as many as 30% of LEED platinium buildings perform no beter than conventional buildings. It is ultimately difficult or impossible for customers to construct a single integrated picture that correlates energy usage and maintenance costs to control system performance, space usage, conservation measures, and the behavior of those using the facility space.”
So, can Duluth believe all of the JCI hype?