Energy Savings Performance Contracting and Measurement and Verification
IPMVP options
Measurement and verification rests on a transparent, adjusted baseline. IPMVP defines four options: A (retrofit isolation with key parameters measured, others stipulated), B (retrofit isolation with all parameters measured), C (whole-building metering), and D (calibrated simulation). Use A or B when savings are large relative to the whole building and equipment-level separation is practical; use C when measures are numerous and diverse; use D when no baseline period data exist or the design is new. The classic trap is calling a project Option B when operating hours were stipulated, or letting Option A stipulations substitute for defensible engineering.
Savings mechanics
Savings = adjusted baseline energy minus reporting-period energy, plus or minus adjustments. Routine adjustments normalize for weather, occupancy, or production using regression on an independent variable. Non-routine adjustments cover changes to the facility itself, such as added loads, changed schedules, or new equipment. Build the baseline from at least 12 months or a full operating cycle, document meters and calibration, and specify the reporting period, verification frequency, and uncertainty in the M&V plan.
Contract structure
An energy savings performance contract uses an ESCO to design, install, and often finance measures, with savings servicing the investment. Structures include guaranteed savings, shared savings, and design-build with a guarantee. Watch measurement boundaries, escalation and discount-rate assumptions, M&V cost, and persistence, since savings decay without follow-up commissioning.
Rule of thumb
Use Option C for a portfolio of many small measures; use Option A or B for one large chiller or boiler plant.