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Owner's Guide to Understanding Methods and Terms of Performance Contracting
Abstract
Performance Contracting is a method of making
improvements to a facility and using the savings
produced by the improvements to pay for the work
over a period of time, typically five to ten years.
Energy Conservation Measures (ECMs) support the
typical project. These ECMs may include a high
efficiency lighting retrofit, computer controlled
energy management, replacement of older inefficient
heating and air conditioning equipment, heating and
air conditioning systems redesign, among others. A
Performance Guarantee assures that the annual
savings will be achieved by making up the difference
should a savings shortfall occur.
Three contracting methods are used by owners
seeking a Performance Contract: Request for
Qualifications (RFQ); Request for Proposal (RFP);
Negotiation. The method of selection can greatly
effect the success of the project.
Owners seeking to improve their facilities
through Performance Contracting should carefully
consider the impact of the contracting method they
select as well as the reliability of the savings
expected. These areas are explored in the following
pages.
Citation
McDaniel, W.; Weaver, K.; Lacy, P. (1998). Owner's Guide to Understanding Methods and Terms of Performance Contracting. Energy Systems Laboratory (http://esl.tamu.edu); Texas A&M University (http://www.tamu.edu). Available electronically from https : / /hdl .handle .net /1969 .1 /6759.