Barriers to ESCO's Projects Relating to Motor Systems and Recommendations on how to Overcome them

The Energy Service Company (ESCO) concept originated in Europe more than 100 years ago and then moved to North America, where the market is currently the most mature. The ESCO concept is now showing some resurgence in the European Union (EU). Also in other regions, and in particular in Asia (Japan, China, and India), there is a strong growing interest in ESCOs. ESCOs are a well known delivery mechanism to implement energy savings technologies in industry and buildings, in particular in companies and organizations which do not have the time, the expertise or the financial means to implement the efficiency solutions. The concept is particularly attractive because it normally provides performance guarantees and thus takes away some of the risk element from the end user organization. ESCOs are now operating in many different countries, under different business models and contract implementation routes. ESCOs are mainly active in the building sector and to a somewhat lesser extent in the industrial sector. ESCOs have not so far implemented many Motor Systems projects, even though these types of projects often yield large energy savings and short payback times (i.e. very profitable projects). They should thus be very attractive for implementation under the ESCO concept. This paper firstly gives an overview of the ESCO concept, and goes on to investigate why not many projects are undertaken for Motor Systems. The paper finally draws some conclusions and gives recommendations on how to further enlarge this important market.

BERTOLDI Paolo; 

2010-01-28

International Copper Association

JRC37895

https://publications.jrc.ec.europa.eu/repository/handle/JRC37895,