Contract Parameter Decision Model of Energy Performance Contracting from Perspective of Interest Maximization of ESCo

Abstract:

Assuming that the energy consumption unit is willing to agree to the contract for energy performance contracting (EPC) when the expected net present value of profit is equal or greater than the threshold value, a contract parameter decision model of EPC is developed from the point of profit maximization of energy service company (ESCo). The effects of financing, registered capital and other factors on the contract parameter and energysaving performance are explored based on the statistical analysis of 179 EPC contracts. The analytic results demonstrate that the financing and the registered capital of ESCo have significant positive effects on the contract parameter and energysaving performance. It is consistent with the fact that the financing difficulty is one of the present obstacles to the development of EPC, indicating that the proposed method is feasible.