Abstract
A lack of trust in Energy Service Company (ESCo) is the most critical factor affecting the development of Energy Performance Contracting (EPC) in China, compared with other constraints. One cannot easily estimate the energy-saving performance of an EPC project. Under that condition, lack of trust may cause the Energy-Consuming Unit (ECU) to suspect the energy-saving performance promised by the ESCo, thus leaving potentially profitable projects without necessary funding. Currently, specific studies taking an across-projects viewpoint on annual energy-saving performance of EPC projects in multiple subsectors, objectively and quantitatively, are lacking. This paper studies the regression relationships of annual energy-saving quantity in terms of revamping cost and the regression relationships of annual cost saving in terms of revamping cost. The regression results show that there are statistically significant correlations in the above relationships in the nine subsectors investigated. This is significant for ESCos and ECUs, because knowledge on energy-saving performance could contribute to EPC investment decisions and trust relationships between ESCos and ECUs. Then, a multiple linear regression model of revamping cost is set up to analyze its influencing factors. The model indicates that the subsector the sample belongs to, financing, registered capital of the ESCo, and contract period have significant effects on revamping cost. Thus, policy implications regarding innovation of EE promotion technology, clarifying ESCos’ exit mechanism, innovation of financing mechanism, and improving the market credit environment for promoting investment in EPC projects, are provided.
Highlights
In 2016, energy consumption of China’s GDP of 10,000 CNY fell by 5.0% [1], and it was 0.675 tce/10,000 CNY at 2010 constant prices
On-site fieldwork has found that a lack of trust in Energy Service Companies (ESCos) is the most critical factor affecting the development of Energy Performance Contracting (EPC) in China compared with other constraints, trust in private Energy Service Company (ESCo) characterized by light assets [15]
Specific studies taking an across-projects viewpoint on estimation of annual energy-saving quantity and annual cost saving in multiple subsectors objectively and quantitatively are lacking, and a cost-effective method is needed. This is significant for ESCos and Energy-Consuming Unit (ECU) because knowledge on energy-saving performance could contribute to EPC investment decisions and trust relationships between them, which contribute to promotion of EPC project investment in the public and private sectors
Summary
In 2016, energy consumption of China’s GDP of 10,000 CNY fell by 5.0% [1], and it was 0.675 tce/10,000 CNY at 2010 constant prices (tce is the abbreviation of ton of standard coal equivalent). The Law of the People’s Republic of China on Conserving Energy was enacted as early as 1997, requiring improvements in the exploitation, processing, conversion, transmission, and supply of energy, so as to gradually raise the efficiency of energy utilization and promote the development of the national economy in an energy-efficient manner [3]. If the latest plan is achieved, by 2020, energy consumption per unit of GDP in 2020 will be 15% lower than in 2015 [6]. The decline in energy intensity needs to be achieved by optimizing the industrial structure and strengthening technological progress. The former is a medium- and long-term process, so greater efforts should be made to improve the efficiency of energy utilization. To achieve universal and potential EE, and to adapt to the profound social change from a planned economy to a market economy so as to integrate EE projects into the market trading system, learning from the experience of developed countries, China has gradually popularized the Energy Performance Contracting (EPC) mechanism
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