Standardised Smart EPC contract and tender documentation



Josip Čengija, REGEA

Publication date

February 12, 2024

The successful preparation and execution of Energy Performance Contracting (EPC) projects require the expertise and experience of project leaders representing a local authority. As technology and innovations in energy efficiency continue to break through, it becomes imperative to engage consultants and experts well-informed of the latest developments in the field of buildings and public lighting. These specialists play a crucial role in project preparation, implementation, and procurement procedures related to energy services.

A key aspect of these projects is to ensure that the technical specifications, procurement conditions, contract proposals, and required guarantees do not exclude competent private companies capable of effectively executing the project. It is vital to safeguard the local authority from unanticipated risks that may arise during the project, while ensuring the delivery of high-quality solutions and equipment. This approach promotes an open procurement procedure that encourages interested entities to offer innovative solutions, thereby maximising the value for taxpayers’ money and achieving the project’s objectives efficiently through public procurement.

When incorporating additional energy and non-energy related services into the Smart EPC approach, the complexity of standard EPC projects is further highlighted. These projects involve the realisation of various types of investments under a single contract, posing challenges in accounting, financing, and legal aspects.

To address these complexities and assist cities in developing such projects, the Smart EPC project has developed a first draft of standardised Smart EPC concept, contract and tender documentation. This documentation provides a comprehensive draft of the contract and its annexes, which can be easily adapted to suit the unique requirements of each client. In addition to contract and tender documents, the Smart EPC concept documentation was also developed to help end users with all the preparatory activities.

This draft documentation will be further amended and updated with findings and conclusions that will be gathered through stakeholder workshops, market consultations and tender procedures of Smart EPC pilot applications.

Go to the documentation

Standardised concept documentation

The standardised Smart EPC concept documentation is relevant for an inventory data collection and an analysis of the public lighting system. These preparatory activities are needed to determine current state of the public lighting system, technical limitations, and potential for implementation of additional technologies and services. Also, the Smart EPC concept documentation helps end users formulate their vision and calculate the initial financial feasibility from potential energy savings.

In particular, the purpose of the concept documentation is:

  • to formulate the requirements for the energy audit: minimum set of baseline data that is needed for decision making and feasibility calculations of public lighting reconstruction. The requirements are summarised in the document called Standardised Methodology for detail energy audit of public lighting and methodology for selection of lighting classes;
  • to develop an analytic tool for feasibility calculation of public lighting reconstruction based on the inputs from the detail energy audit – tabular based tool called Analytic tool;
  • to draft a document which can serve as a tool for presenting the current state of infrastructure and reconstruction potential, as well as the optimal coverage and financing modelling for pilots/cities – draft and content example is provided in the document called Public lighting reconstruction Action plan;

Standardised contract and tender documentation

The Smart EPC contract documentation is focused on two core subjects: energy performance and guaranteed energy savings. The additional energy and non-energy services are categorized as either commercial or non-commercial services. The former can be financed by charging for the services to third parties or the general public on a commercial basis. In contrast, the latter may not be feasible through commercial financing and are usually included within the contract. These distinctions result in different types of investments for the client, with non-commercial investments considered as “on balance sheet” and commercial ones often treated as “off balance sheet.”

The draft of the Smart EPC contract documentation, besides general stipulations, comes with all associated annexes, such as technical requirements, value of investment in form of excel tables and others providing end users with tools to start the development of their Smart EPC project in accordance with best practice.  

In addition to the draft of the standardised Smart EPC contract documentation, the project has also developed a draft of the standardised Smart EPC tender documentation. This draft serves as a guideline document for clients when preparing official tender documentation, offering insights on how to specify certain requirements. Even though the standardised tender documentation needs adaptation to comply with specific national legal frameworks and project requirements, it is useful in promoting best practices and raising the awareness of end users when entering in – quite often, complex – tender procedures.