The 2019 QualitEE market survey provides valuable insight into the development of Energy Performance Contracting (EPC) and Energy Supply Contracting (ESC) markets. It received responses from energy efficiency services providers and facilitators across 15 European countries.

The survey follows on from similar surveys carried out in 2013, 2015 & 2017, which together offer an extensive database that can be explored on the QualitEE website (https://qualitee.eu/market-research/). Here, interactive charts can be used to compare results from different countries, trends over time, and review responses relating to EPC and ESC markets separately.

The following outlines 10 key points from a UK perspective. Direct links to relevant interactive results online are provided – use toggles and drop downs to display UK results:

1. UK has slower growth in EPC, but higher growth in ESC – UK EPC market more hesitant than across Europe – major growth experienced by 5% of respondents in UK vs 19% across Europe, and down on 38% in UK in 2017. UK ESC market more positive – major growth reported by 33% of respondents vs 16% across Europe.

2. But, the UK has bigger projects – for EPC / ESC respectively 70% / 66% of respondents report most projects over 1 million Euros vs 38% / 17% across Europe

3. Purely shared savings EPCs are reported to be rare in the UK – which matches the picture across Europe, although they are reported to be more widely used in Austria, Germany & Portugal.

4. And financing in the UK is reported to be focussed more on client arranged funds and less on that of service providers than across Europe, although UK EPC providers offering services with their own funding arrangements has seen an uptick since 2017.

5. UK EPC business is reportedly driven by the public sector, which matches the picture across Europe, however UK ESC business is more clearly focussed in the private sector

6. EPC performance measurement & verification (M&V) is reported to be purely focussed on specified processes, following protocols such as the IPMVP, and like Europe c. 25% of respondents typically see this aspect of the service being operated by an independent third party.

7. Complexity and lack of information have consistently been seen as the key barriers to business in the UK and across Europe from 2013-2019. High costs of project development and procurement are reported to be particularly acute barriers in the UK, along with:

8. Positively, lack of trust in the ESCO market appears to be reducing as an issue in the UK since 2017 (52% down to 30% of respondents selected this as a key barrier), and is less acute an issue than across Europe along with

9. UK ESC business has similar barriers to EPC business, although “lack of support from Government” – expected to be mainly linked to the recent removal of subsidies – is reported to be a particularly acute issue.

10. The Energy Savings Guarantee is reported to be the main driver of EPC business in the UK and Europe, but “pressure to reduce costs” and “external expertise / turnkey services” are also particular drivers in the UK.

In the UK we are looking to tackle issues of complexity / lack of information and high development / procurement costs through the implementation of a quality assurance scheme for Energy Performance Contracting. This aims to provide transparent and independently verified performance information of EPC service providers at market level, and to drive standardisation.

An initial proposal for the quality assurance scheme has developed. We’re now collecting feedback – particularly from UK EPC services providers – to work up a final proposal. If you are interested to find out more and provide feedback, please get in touch by emailing UK QualitEE lead Nick Keegan to book a meeting early next year.