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PART 2
Key elements must
be clearly stipulated
and agreed upon
Investments from EPC projects implementation could also
contribute to the growth
Here I would like to share
on key steps and key elements
that need to be
considered in implementing
energy saving projects
using the EPC energy saving model.
Key Steps In the
Implementation Process
Based on my reading and some research
on EPC, below is how I could summarise
on key steps involved to ensure EPC
process will work.
1. EPC needs confirmation by Building
Owner: The building owners have
made assessments and EPC agreed
by top management as a model that
is employed for the implementation
of energy saving projects over the
use of the internal budget where
the potential building has been
identified.
2. Preparation of basic information,
objective, assessment criteria and
guidelines in the implementation
EPC project in the building.
3. Notification and publicity for the
invitation to the implementation of
the EPC project – to spread the news
to all interested parties about the
project with the eligibility requirements
and criteria in a nutshell.
4. Briefing by building owners to
interested ESCOs, site visits and the
handing over of basic information of
the building.
5. Submission of the preliminary
proposal by ESCOs based on
the evaluation criteria and basic
information.
6. Evaluation preliminary Proposal
by ESCOs based the assessment
criteria.
7. The appointment of ESCO to implement
EPC project based on an
energy audit to be carried out with
the conditions agreed in the EPC
contract.
8. ESCO to conduct a detailed energy
audit, propose implementation and
investment proposal using EPC
model together with the draft EPC
contract document.
By Zaini
Abdul Wahab
9. Negotiate EPC contractual terms
of the proposed investment for the
implementation where the conditions
discussed by the ESCO and the
building owner to be finalized.
10. Signing of EPC Contract with conditions
that have been agreed upon.
11. EPC Project Implementation which
will cover improvements and the
installation of energy efficient
equipment and systems, testing and
validation of performance and measurements
of actual energy savings
based on the baseline and methods
that have been agreed upon;
12. Monitoring and verification actual
achieved and monthly payments to
the ESCO
Key selection criteria of ESCO to
perform EPC projects
The selection of qualified and capable
ESCO is very-very critical in determining
the success of the implementation
of the EPC project to achieve energy
savings as had been committed.
Apart from having the capability in
terms of technical expertise to identify
and implement energy-saving’s potential
project or proposed measures, there
are several other criteria that must be
considered.
Among them are:
i) The ability of the qualified and competent
management and technical
personnel of the ESCO to manage
and execute EPC projects;
ii) The financial strength of the company
to fund a project either by using
internal financial resources or loans
from financial institutions, and
iii) Track record and experience in
implementing projects with EPC
concept including the scale of
investment in the projects
As a guide, the Malaysian
Association of Energy Services
Company (MAESCO) has proposed a list
of criteria to evaluate an ESCO that can
be used as a reference or basis based on
feedback and experience of its members
in implementing EPC projects.
A summary of the proposed criteria
include the following:
i) The minimum paid-up capital and
financial position ESCO - to ensure
that the ESCO has enough basic
financial position to be considered
by the bank for any financing;
ii) The need to have a top management
and technical teams with minimum
qualifications and experiences
in project implementation Energy
Conservation projects especially in
using EPC model;
iii) The need to have permanent technical
support groups to implement the
proposed energy saving projects;
and
iv) The need to have the basic equipment
for conducting detailed energy
audit.
In addition to the criteria mentioned
above, other important criteria to
ensure that the qualifications and
capability of an ESCO to implement the
EPC projects particularly in the government
sector are as follows:
i) The Company has been registered
with the Energy Commission as an
ESCO;
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november-december, green+.2014