What is Energy savings performance contract (ESPC) measurement?
Energy savings performance contract (ESPC) measurement is the measurement and verification process that shows whether the energy and water savings promised in a performance contract actually occurred. Because the contractor's payments are funded from those savings, the public owner needs an independent, measured view of the baseline and the results over the life of the contract.
What it is
In an ESPC, an energy service company designs and installs upgrades and guarantees a level of savings. The owner pays for the project over time from the savings. Measurement and verification, or M&V, is how both sides agree whether the guarantee was met.
M&V plans usually follow IPMVP options. Some measures are verified by measuring key parameters or isolating the retrofit with sub-meters, others by whole-facility analysis of utility data. Some savings are stipulated, meaning agreed on paper and not measured each year.
Owners often rely on the contractor's annual M&V report. Independent metering lets the owner check the baseline, see whether savings persist, and spot measures that have stopped performing.
Who it applies to / where it is used
ESPCs are widely used by counties, cities, school districts, universities, hospitals, state agencies and federal facilities. Facilities directors, finance offices, auditors and procurement teams all have a stake in the M&V results.
How it is measured / what evidence it needs
Strong ESPC evidence covers the baseline, adjustments and post-installation performance, with stated uncertainty.
- Baseline period energy and water, with weather and occupancy variables
- Retrofit isolation meters for key measures
- Whole-facility interval data after installation
- Adjustments for changes in use, hours or space
- Annual savings compared with the guarantee
How Aqueduct helps
Aqueduct gives the owner its own measured view of ESPC performance, alongside the contractor's report.
- Weather-normalized regression baselines built from bills and meter data
- Retrofit isolation with sub-meters on the measures that matter most
- Ongoing tracking that flags measures whose savings are slipping
- Measured records the owner, contractor and auditors can review together