The U.S. Department of Energy unlocked billions of dollars in private capital to improve the efficiency and sustainability of federal facilities.
Federal Energy Management Program
August 4, 2023
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WASHINGTON, D.C. — Today the U.S. Department of Energy (DOE) unlocked billions of dollars in private capital to improve the efficiency and sustainability of federal facilities. DOE competitively awarded contracts to 20 energy service companies (ESCOs) to provide Energy Savings Performance Contracts (ESPCs) for federal agencies, marking the fourth generation of such contracts awarded by DOE since 1998.
Energy and water infrastructure projects financed through DOE's ESPC indefinite-delivery, indefinite-quantity (IDIQ) contract offer guaranteed cost savings for federal sites. With a ceiling of $5 billion per ESCO contract, they require no upfront government funding and are designed to pay for themselves over time.
"These contracts play a crucial role in supporting federal energy savings and greenhouse gas reduction goals, as set forth by President Biden and Congress," said DOE Undersecretary for Infrastructure David Crane. "Energy Savings Performance Contracts allow agencies to leverage private sector capital for much-needed energy infrastructure projects. This helps agencies focus on their critical missions while also leading by example in the pursuit to decarbonize more buildings and living spaces."
Since 1998, more than 30 federal agencies have utilized the DOE IDIQ to help fund projects across all 50 states, Washington, D.C., U.S. territories, and international locations, including Spain, the Republic of Korea, and Japan. The previous projects awarded under the DOE ESPC IDIQ have delivered impressive outcomes:
- $8 billion in federal building infrastructure;
- Support for American job growth, contributing to approximately 64,000 job-years in equipment manufacturing, installation, and construction trades;
- Utility cost savings for the federal government, amounting to over $748 million in annual utility and operations and maintenance savings;
- Reduced federal building energy consumption by 33 trillion BTU per year, equivalent to removing 470,000 cars from the road for a year or the annual energy use of 266,400 average American homes; and
- Significant reduction in greenhouse gas emissions, accounting for over 2 million metric tons of CO2e per year.
Federal agencies interested in initiating their next ESPC project are encouraged to contact the Federal Energy Management Program (FEMP) to get started. Stakeholders, including federal agencies, ESCOs, and the public can visit FEMP's ESPC program page to view the awarded contracts and access further information about ESPCs.
As FEMP celebrates its 50th anniversary and the 25th anniversary of the first DOE ESPC awarded project, this announcement highlights the continued success and potential for further achievements in federal energy efficiency.
For more information about the newly awarded energy savings performance contracts and other ESPC program information, please visit the following links:
About FEMP
DOE FEMP promotes energy efficiency and sustainability in federal government operations. FEMP provides tools, resources, training, and assistance to federal agencies to meet energy-related goals, identify affordable solutions, facilitate public-private partnerships, and provide energy leadership to the country.