Energy Service Companies as a Component of a Comprehensive University Sustainability Strategy

Abstract:     
The sustainability deficit observed in modern universities is not necessary to fulfill the education, research, or administrative functions of the university system, because a vast quantity of natural resources are currently wasted. The current waste thus provides a large number of opportunities to improve environmental stewardship while reducing operating costs. Guaranteed energy savings programs (GESPs), which utilize the technical and financial expertise of energy service companies (ESCOs), provide a means to capitalize on these opportunities to move universities towards sustainability. The guaranteed savings from energy conservation measures provide more than sufficient funds to service loan payments each year for the capital needed to make efficiency improvements and generally completely pay for themselves in ten years or less. Energy savings projects are win-win situations, addressing both ecological and economic stewardship. The utilization of ESCOs can accelerate the implementation of energy savings projects and garner institutional support for sustainability initiatives. This paper focuses on the best practices of a comprehensive Environmental Stewardship Strategy that includes a GESP to expand a university’s environmental stewardship. The GESP improved the operational efficiency, decreased the ecological footprint, and reduced the operating costs of the University. The environmental and economic benefits and limitations of this approach will be critically analyzed in the context of sustainability with the goal of providing a model for other universities to improve upon.

Number of Pages in PDF File: 18

Keywords: energy service company, ESCO, energy service performance contracting, guaranteed savings energy, energy conservation, energy efficiency, service contract, sustainability, green schools, green college, green university

JEL Classification: Q40

Accepted Paper Series