ABSTRACT: Over the last decade, performance contracting has emerged within the Commonwealth of Pennsylvania as a valuable means of funding the implementation of a broad range of energy conservation measures. Simply put, performance contracting is a procurement strategy that a governmental unit can utilize to pay for the implementation of energy conservation measures with the savings they produce. This article outlines the enforceability challenges that emerge when the profitability of an energy service company is relational to the overall risk exposures of its outstanding guarantees. Analyzes six legal issues: commencement of the guarantee period; reconciliation of guaranteed savings; stipulated savings; contract management; service responsibilities; and dispute resolution. Presents a two part solution to the enforceability challenge. And concludes by positioning enforceability as the foundation of tax payer confidence in the performance contracting model and the jobs it creates.
Please contact me via LinkedIn if interested in a pre-release copy or to participate in the editing process. I envision this article as the first of a four part series and welcome your support.
~Dedicated to Natural Capitalism.