Ecosave Services Agreement
Fully funded energy and water savings with Ecosave Services Agreement (ESA)
A low risk financial solution to power energy efficiency
Energy and water efficiency makes good sense, the economic business case stacks up. But capital is not always available to invest in projects that are not core business. Ecosave offers a range of funding solutions to help get your project up and running. There are a number of funding options available in the market, but the Ecosave Services Agreement (ESA)™ provides fully-funded capital upgrades with no debt or upfront capital required by the client. Better still, the investment will be cash flow positive, enabling you to still make savings during the repayment stage.
Ecosave specialises in Energy Efficiency retrofit projects and Energy Management Services. We reduce your energy and water consumption and costs through building upgrades and ongoing energy management services. What’s more, we make your investment in resource efficiency return positive cash flow from day one!
How? We offer innovative financing solutions for our energy and water efficiency retrofit projects, including the off-balance sheet Ecosave Services Agreement.
Ecosave Services Agreement (ESA)
The ESA is our flagship funding model – offering a completely off-balance sheet Service Agreement with monthly payments that can be funded from the energy savings! The ESA incentivises Ecosave to over-deliver on savings, driving your energy and water bills even further down.
At Ecosave, you could get a fully funded performance-based energy efficiency project requiring no debt or upfront capital investment.
…ESA upgrades can remain completely off balance sheet and the monthly payments can be funded by your operational budgets… ESA is structured to be cash flow positive so the savings will be greater than your current energy spend.
Benefits and Features
- Ecosave’s ESA is typically a 7-15 year service arrangement.
- Ecosave funds and maintains ownership of all the equipment installed and commissioned. Given the focus is on delivering energy savings, Ecosave reserves the right to change the equipment or solution. This allows Ecosave the opportunity to provide the client the best possible solutions and latest in energy conservation technology.
- The Ecosave Services Agreement™ differs from a Capital Lease due to the variable pricing component tied directly to performance-based criteria (i.e. the amount of energy savings achieved).
- There is no balloon payment or obligation from the client to purchase the equipment at the end of the service period.
- Ecosave provides integrated services with the objective to achieve the energy savings target. If there is a shortfall from the target, the client pays less. If there are no savings achieved, the ESA does not incur the client a service fee until the solution is revised and savings are realised.
- The energy savings and cost savings achieved by the ESA are typically greater than the client’s current utility and maintenance expenditure, which means the service fees are funded from the energy savings directly from the operational budget (i.e. cash-flow positive).
- The ESA savings are guaranteed, so we conduct annual measurement and verification in accordance with the International Performance Measurement and Verification Protocol (IPMVP) to determine if we have over or under delivered the targeted savings guarantee.
How does the ESA work?
- Ecosave will deliver an energy efficiency retrofit upgrade in your facility and fund the full capital cost of the project on your behalf.
- We provide ongoing services to support the upgrade and maintain the savings, including energy management, maintenance, and annual measurement and verification (M&V) of savings.
- Some of the equipment used to achieve the savings will be owned by Ecosave and we will be responsible for operating and maintaining this equipment during the contract.
- At the end of the contract, you have the option to purchase the equipment at agreed market value.
What happens if the savings are not achieved?
- Under the ESA, Ecosave is contracted to deliver savings, and a portion of the monthly fee is tied to our performance. If we under-deliver savings, we will find additional savings at our own cost, or refund enough of your fee to make up the difference.
- If Ecosave over-delivers on savings, you pay for 20% of the extra savings (over and above the guaranteed savings), a win/win incentive for us to over-perform.
- The ESA upgrades will remain off your balance sheet, so the monthly payments can be funded from your operational budgets, right where the savings are being made. Better still, the Ecosave Service Agreement is structured to be cash flow positive so the savings will be greater than the fees.
