Department of Health

Energy performance contracting

Key message

  • Energy performance contracting is an innovative model for delivering large scale energy efficiency projects in hospitals.

Energy Performance Contracting (EPC) projects are a means of delivering significant energy and water-efficiency investment in existing facilities through a contract with an Energy Service Company (ESCO). The ESCO designs and installs efficiency measures and guarantees the energy and water savings, which are then used to repay the upfront investment for the initiatives over a seven-year period.

The types of projects undertaken as part of an EPC could include HVAC (heating, ventilation and air-conditioning), upgrade of central engineering services, building management systems and lighting.

The department facilitated a $5.84 million energy performance contract for the West Gippsland Healthcare Group. The project includes installation of 3,624 energy efficient lights, 288 kilowatts of solar panels, a new Building Management System, replacement of laundry equipment and upgrades to engineering infrastructure. The project is expected to result in $0.6 million in energy, water and operational savings every year, as well as a reduction in 2,525 tonnes of greenhouse gas emissions.

The department is investigating further opportunities for similar projects in other healthcare facilities.

Reviewed 10 October 2022

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