"Energy supply contracting" for energy generation and provision in properties owned by the city

The City of Augsburg plans to extend its so-called "energy supply contracting" for the generation and provision of energy in properties owned by the city and to enter into so-called "energy savings contracting".

City’s energy policy ideas and contractual contents

bifa analysed and described the associated advantages and disadvantages for the energy management department of the City of Augsburg (KEM) based in the building department. The objective was optimum coordination of the City’s energy policy ideas with the contractual contents for implementation of the contracting service. To this end, the economic, energy and legal issues were analysed and assessed and proposals were submitted with regard to the legal form and arrangements of a framework agreement. The City of Augsburg's land ownership means that it is responsible for an extensive stock of buildings. In many buildings the building services were installed in the 1960s; whereas nowadays utility supply systems that are 15 years old are already deemed to be obsolete.

Target: reducing CO2 emissions

Achieving energy standards for the plant and systems technology therefore holds large potential for reducing CO2 emissions and ergo for supporting implementation of the climate protection targets. Until now a framework agreement has existed for the operation of the energy generation systems and provision of energy (power) for all of the city's schools; the intention now is to extend energy supply contracting to all the buildings owned by the city. As the conclusion of a framework agreement constitutes a long-term decision or commitment for the management of the plant and systems for an extensive stock of buildings, the city's auditors requested a detailed expert's report with regard to the best possible contractual form and arrangements. To this end, by way of example, existing energy contracting agreements were evaluated with regard to their economic efficiency in order to deduce the potential that exists in extending the framework agreement. Using defined valuation factors, the quality and scope of the possible savings and modernisation investments via a framework agreement were pointed out. The completeness of the cost factors and their breakdown in the contracting agreement were evaluated based on the use parameters underlying the calculations and decisive for the economic result, e.g. basic heat consumption and use times. A comparison was then made using an own costs calculation, i.e. the costs that would have been incurred if the systems had been implemented and operated by the city itself as in the past. Another point covered in the consulting was the determination and checking of additional components, which could be introduced into the existing energy supply contracting via energy-savings contracting. Accordingly, proposals were worked up for additional energy-savings contracting components. The risks and restrictions, which exist with regard to the contractual arrangements in the event of a change to the contractual basis with respect to the consumption situation, were then evaluated and a legal appraisal was carried out on the performance parameters and the provisions contained in the contract.

Conclusion

bifa demonstrated that the existing framework agreement is economically advantageous and extending it makes sense. Due to a higher-level viewpoint compared to the purely business management perspective and the incorporation of cost-benefit relations with regard to the ecological targets, additional ecology-orientated economic feasibility indicators produce further assessment arguments.