DOE Awards Sixteen Contracts for up to $80 Billion in Energy Efficiency, Renewable Energy, and Water Conservation Projects at Federal Facilities

The Department of Energy (DOE) announced the award of 16 new Indefinite Delivery Indefinite Quantity (IDIQ) Energy Savings Performance Contracts (ESPCs) on Deceber 15th that could result in up to $80 billion in energy efficiency, renewable energy, and water conservation projects at federally-owned buildings and facilities. 

ESPCs help to meet the federal government’s energy efficiency, water conservation, and renewable energy goals. The federal government is the largest single user of energy in the United States and these awards demonstrate a commitment to sound government stewardship by recognizing efforts to save energy, reduce federal energy costs, cut greenhouse gas emissions, bring more cutting-edge technologies to use, strengthen national security, and create a stronger economy.

“This set of awards will ensure that federal agencies have access to powerful tools for alternative financing at a scale that is needed to meet our challenge of reducing energy intensity, increasing the use of renewable energy, and decreasing water consumption.” U.S. DOE Secretary Samuel W. Bodman said.

In August 2007, Secretary Bodman launched the Transformational Energy Action Management (TEAM) Initiative, a Department-wide effort aimed at reducing energy intensity across the nationwide DOE complex by 30 percent. The TEAM Initiative aims to meet or exceed the aggressive goals for increasing energy efficiency throughout the federal government already laid out by President Bush through Executive Order 13423, which directed federal agencies to: reduce energy intensity and greenhouse gas emissions; substantially increase use and efficiency of renewable energy technologies; adopt sustainable design practices; and reduce petroleum use in federal fleets.

The new contracts were awarded to the following Energy Service Companies (ESCOs):

• Ameresco, Inc. (Framingham, Mass.);


• Chevron Energy Solutions (Eagan, Minn.);


• Clark Realty Builders (Arlington, Va.);


• Consolidated Edison Solutions, Inc. (White Plains, N.Y.);


• Constellation Energy Projects & Services Group, Inc. (Baltimore, Md.);


• FPL Energy Service, Inc. (North Palm Beach, Fla.);


• Honeywell International, Inc. (Golden Valley, Minn.);


• Johnson Controls Government Systems, LLC (Milwaukee, Wis.);


• Lockheed Martin Services, Inc. (Cherry Hill, N.J.);


• McKinstry Essention, Inc. (Seattle, Wash.);


• NORESCO, LLC (Westborough, Mass.);


• Pepco Energy Services (Arlington, Va.);


• Siemens Government Services, Inc. (Reston, Va.);


• TAC Energy Solutions (Seattle, Wash.);


• The Benham Companies, LLC (Oklahoma City, Okla.); and,


• Trane U.S., Inc. (McEwen, Tenn.).

The goals set out in Executive Order 13423 and the requirements put forth by Congress in the Energy Policy Act of 2005 and the Energy Independence and Security Act of 2007 include a 30 percent reduction in energy intensity and a 16 percent reduction in water use by 2015, and an increase of renewable energy to 7.5 percent of electricity needs by 2013 for Federal facilities. ESPCs enable agencies to undertake energy savings projects without paying up-front capital costs. ESPC task orders typically are placed competitively and can be used for energy and water efficiency and renewable energy projects.

Under an ESPC, the contractor designs, constructs, and obtains the necessary financing for an energy savings project, and the agency makes payments over time to the contractor from the savings reduction in the utility bills which are paid by the agency’s appropriated funds over time. The contractor guarantees the energy improvements will generate savings. Moreover, the aggregate annual amount of payments to the contractor and payments for utilities cannot exceed the amount that the agency would have paid for utilities without an ESPC. After the contract ends, all continuing cost savings accrue to the agency.

The new contracts provide for a maximum individual contract value of $5 billion over the life of the contract, eliminate technology specific restrictions, and allow federal agencies to use these contracts in federal buildings, nationally and internationally. In addition, ESPCs now include a greater emphasis on renewable energy and water conservation projects.

For further information on the new ESPCs please see the feature box on the FEMP website.

Deserts and Nanotechnology Can Provide Clean Power and Water for 10 Billion

The global annual fossil energy consumption corresponds to the energy received by 5.7 hours sunshine in deserts. This is about 0.15 % of annually incoming radiation.  Solar power from deserts could supply electricity to 10 billion people in 2050.    

The technology exists to convert 15% of solar radiation into the useful energy form of electricity.  This means, that 1% of the area of global deserts would be sufficient  to produce the entire annual primary energy consumption of humankind as electric power. In other words: any conceivable global demand of energy, today or in future, could be produced from solar energy in deserts.

The DESERTEC Concept is an inter-continental project to supply sustainable electricity to Europe (EU), the Middle East (ME) and North Africa (NA) up to the year 2050. It shows that a transition to competitive, secure and compatible supply is possible using renewable energy sources and efficiency gains, and fossil fuels as backup for balancing power.   The project will harness the sun’s power, supplying the energy needs of that region as well as transporting power from Africa to Europe along energy superhighways (high-efficiency high voltage direct current lines). Spain is already using solar thermal plants, and they have also been in use in the U.S. for more than 20 years.

To this end red squares in the figure represent the accumulated areas for collectors typically needed to generate 17,000 TWh/y (terawatt hours per year) which is approximately the current world consumption, 3200 TWh/y (approx. EU-25 consumption), and 600 TWh/y (approx. Middle East/North Africa (MENA) consumption).

The square labeled “TRANS-CSP Mix 2050” indicates the space needed for solar collectors to supply the needs for seawater desalination and about two-thirds of the electricity consumption in MENA in the year 2050 and about one-fifth of the European electricity consumption by Concentrating Solar Thermal Power Plants (2,940 TWh/y in total)

The figure below shows Concentrating Solar Thermal Power Plants in the Mojave Desert.

Until 2020, the market for solar thermal power plants will show annual double-digit growth rates and attain annual sales of over $28 billion (EUR20 billion). In the future, the primary focal growth regions will be the U.S., South Africa, Australia, Spain, India, North Africa and the Middle East.  The developing and in particular the developed world depend crucially on the continuous supply of energy. The fossil fuel consumption in 2005 was 107,000 TWh/y.

If desalination of sea water is powered by solar energy instead by fossil fuels, its environmental impacts are significantly reduced. However, seawater desalination itself is always a considerable burden to the environment, due to the resulting salty brine and the necessary chemical water treatment. Nano-filtration of intake water can mitigate those impacts, but more energy is required in that case. Therefore, activating the existing potential for enhanced efficiency of water use, water management and infrastructure is also a very high priority, in order to minimize the need for desalination. The European AQUA-CSP study analyzes the environmental impact of a broad application of solar-powered seawater desalination to cover the expected freshwater deficits.

Siemens AG is acquiring the solar thermal power company Solel Solar Systems Ltd. to bolster its position in renewable power.  Solel has a workforce of over 500 and is one of the world´s two leading suppliers of solar receivers, which are key components of so-called parabolic trough power plants. The high-growth company, which posted revenue totaling almost $90 million in the first six months of its current fiscal year (January 1 to June 30, 2009), is also a leader in the planning and construction of solar fields. The purchase price is about $418 million.  Since 2006, Solel has also been present on the Spanish market, supplying key components for 15 solar thermal power plants with a combined capacity of 750 megawatts. In addition, the company is also active in the U.S. market. The transaction which much receive regulatory approval is expected to close before 2010.