Shared Savings Agreement Energy Efficiency

Typically, there are two types of insurance packages offered by insurers: technical and credit. As part of the technical package, the insurer covers ESCO or the technology provider in the event that the promised energy savings are not achieved and will bear the technical risk associated with efficiency projects. In the loan package, the insurer assumes the credit risk of a project and thus ensures that in the event of a credit default to customers, repayments can continue to be made to ESCO. Guaranteed savings and shared savings Figure 2 illustrates the relationships and risk allocation between ESCO, client and lender in the two main models of performance contracts: shared savings and guaranteed savings. Brief descriptions are also provided. Energy Performance Contract Guaranteed Savings Model (EPC GS): ESCO guarantees a certain saving on the customer`s energy bill. ESCO takes care of the technical risk. . . .