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May 2017 marks the 20th anniversary of the award of the U.S. Department of Energy’s (DOE) first indefinite-delivery, indefinite-quantity (IDIQ) energy savings performance contract (ESPC). This innovative contracting mechanism has allowed the federal government the opportunity to draw upon private sector expertise and funding to design, build, and finance energy savings projects within federal facilities, all paid for out of the projects’ guaranteed savings generation.
Over the course of the past 20 years, 37 federal agencies have used to the DOE IDIQ contract to award a total of 369 ESPC task orders with an investment value of more than $4.9 billion. These projects have been implemented across all 50 states and multiple foreign sites resulting in the following benefits to the federal government and U.S. taxpayer:
- Total guaranteed energy and water cost savings of $11.8 billion
- Annual energy savings of more than 27 trillion Btu, the equivalent energy usage of 300,000 average U.S. households
- Annual water savings of more than 5 billion gallons per year
- Creation of 40,000 job-years
- Support of U.S.-based manufacturing across 35 states (Source: Improving Federal Energy Savings Through Performance Contracting, National Association of Manufacturers).
The Federal Energy Management Program’s (FEMP) own Brad Gustafson served as the project facilitator of the first project award under the regional contract at the U.S. Coast Guard Air Station in Kodiak, Alaska.
Coinciding with the 20th anniversary, DOE recently released the third-generation DOE IDIQ ESPC, containing enhancements from the 20 years of lessons learned in operating federal ESPCs. With the new IDIQ contract, federal agencies will be well positioned in the years to come to leverage the power of ESPCs to convert wasted energy and water consumption into improved federal building infrastructure and performance.
Learn more about ESPCs.