18 July 2014

City of Vantaa shares its experiences of ESCO procurement

The Finnish city of Vantaa has published a useful summary document sharing its experiences of sustainable energy service contracting (ESCO) to improve energy efficiency in 14 buildings across the city. While being honest about the difficulties involved, the case study shows final award criteria of 20-30 percent energy savings and provides useful tips for other ESCO procurements.

Vantaa aims to achieve savings of up to 30,000 MWh across the 14 buildings over the course of the contract, equivalent to over €200,000 per year. The €1.5 million of project costs must be covered by savings realised within the agreed contract period. This funding model was a central aspect of the tender, with suppliers given room to provide their own energy-saving calculation models. Overall savings will be monitored on an annual basis and profits shared between the ESCO Service provider and the City of Vantaa if energy savings exceed the targets.

Key lessons from the project include the value of investing in a pilot project beforehand and ensuring an open and constructive dialogue with potential suppliers throughout the process to avoid potential misunderstanding. Publishing bidders’ questions and answers online was also recommended to keep the process transparent and all parties on an equal footing. For Energy Specialist Marita Tammen, who had joint responsibility for the project, the key to success lies in carefully defining project criteria to ensure they are fair and seeking legal advice to guarantee compliance with public procurement law.

For more information, click here.