David Barash -
Energy efficiency has long proven to be a viable, and even lucrative, opportunity for private companies with capital to invest - and an incentive to seek out simple upgrades that offer short paybacks. Recent years have brought increased activity from energy service companies (or ESCOs) who have entered the market and been very effective at completing large energy efficiency projects that can generate high returns. Unfortunately, despite this market activity, a swath of more difficult, smaller-scale, and lower-return efficiency opportunities still remains virtually untouched.
As a society, we all lose when energy and resources are wasted. Ultimately, the current situation represents a market failure to find an effective, profitable way to offer energy efficiency services to buildings that are not currently served by ESCOs. It’s also a lost opportunity for investors to support projects that generate sustainable returns along with substantial environmental and social benefits.
A New Kind of Investment Brings More than Just Profits
That’s why VEIC has brought together a team with the finance, energy efficiency, and business experience to develop a new investment opportunity – one that generates benefits for both investors and our society as a whole. The concept of a public purpose ESCO (or PPESCO, peskō) is to fill a market need by improving the buildings that serve our communities, and use energy savings to pay for energy improvements. This opens the market to new investment opportunities in energy efficiency, while reducing long term costs for building owners.
In practice, a PPESCO is structured to generate a social and financial return while maximizing energy savings, which enables it to seek out efficiency opportunities that traditional ESCOs do not explore. This means bringing the benefits of energy efficiency to small and mid-size facilities that have broad public value such as schools, hospitals, and multifamily buildings – particularly those in smaller cities and towns, as well as low income and underserved communities. It also means taking a comprehensive approach to remove barriers and achieve deep energy savings, while bringing real and lasting value to communities.
Earlier this year, VEIC launched a public-purpose energy savings company as a wholly-owned subsidiary. We are currently pursuing projects and capital in order to scale quickly and meet the climate challenges facing our planet. The aim is to unleash the full power of energy efficiency by unlocking private capital to reduce energy costs and improve the buildings that serve our communities. It’s an attractive opportunity for investors who want their dollars to generate solid returns – not just for their balance sheets, but also for the environment and our society as a whole.
Learn more about the PPESCO concept.
To suggest project opportunities to the VEIC team, please contact us