Energy Management Contract (EMC) Model

Energy Performance Contracting (MC for domestic and EPC for overseas) refers to the provision of energy-saving services, energy-saving diagnosis, financing and renovation by professional energy-saving service companies (EMCO for domestic and ESCO for foreign abbreviated as ESCO) through energy service contracts. It is a market-oriented energy-saving service mechanism that recovers investment and obtains reasonable profits in the form of energy-saving sharing. Its essence is an energy-saving business method that pays the full cost of energy-saving projects with reduced energy costs. This energy-saving investment method allows customers to upgrade factories and equipment with future energy-saving benefits to reduce operating costs; or energy-saving service companies provide energy-saving services to customers by promising energy-saving benefits of energy-saving projects or contracting overall energy costs. There are various business models for energy management contracts.

1. Energy-saving benefit sharing type

For electric energy substitution projects, energy-saving service companies provide funds and whole-process services, implement electric energy substitution projects with the cooperation of customers, and share energy-saving benefits with customers in accordance with the agreed proportion during the contract period; after the contract expires, the project electric energy substitution benefits and electric energy substitution projects Ownership goes to the customer, and the customer's cash flow is always positive. The key to this type of model is the confirmation, measurement, and calculation method of energy-saving benefits to be written into the contract. In order to reduce payment risks, users can provide energy-saving service companies with various payment guarantees for energy-saving benefits.

2. Energy cost hosting type

The user entrusts the energy-saving service company to invest in the energy-saving renovation and operation management of the energy system, and according to the agreement between the two parties, the energy cost of the energy system is handed over to the energy-saving service company for management, and the energy cost saved by the system belongs to the contract type of the energy-saving service company. After the project contract ends, the energy-saving equipment transformed by the energy-saving company will be handed over to the user for free, and the energy-saving benefits generated in the future will all belong to the user.

3. Energy saving guarantee type

For electric energy substitution projects, customers provide electric energy substitution project funds in stages and cooperate with the project implementation, and energy-saving service companies provide whole-process services and ensure the energy-saving effect of the project. According to the contract, the customer pays the service fee to the energy-saving service company. If the project fails to achieve the promised energy saving, according to the contract, the energy saving service company and the customer will share the excess energy saving benefits according to the agreed proportion. At the end of the project contract, the advanced high-efficiency energy-saving equipment will be handed over to the client enterprise for use free of charge, and all the energy-saving benefits generated in the future will be enjoyed by the client enterprise.

For the electric energy replacement project, the customer entrusts the energy-saving service company to carry out the energy-saving transformation and operation management of the energy system, and pays the energy trusteeship fee according to the contract. The energy-saving service company raises funds by itself to manage and transform the energy system for the client, contract energy costs, and the contract stipulates the energy service quality indicators and their confirmation methods. The main economic source of energy-saving service companies comes from the saving of energy costs, and the economic benefits of customers come from the reduction of energy costs (contracting amount).

4. Financial leasing type

The financing company invests in the purchase of energy-saving equipment and services from energy-saving service companies, leases them to users, and regularly charges users for lease fees according to the agreement. The energy-saving service company is responsible for transforming the user's energy system, and measuring and verifying the energy-saving during the contract period to guarantee the energy-saving effect. After the project contract ends, the energy-saving equipment will be handed over to the users by the financing company for free, and the energy-saving benefits generated in the future will all belong to the users.

5. Hybrid

A contract type formed by any combination of the above 4 basic types.

The advantages of Shenzhen Taiwa Energy Technology Co., Ltd. implementing EMC:

(1) Energy-consuming units do not need to bear the capital and technical risks of energy-saving project implementation, and at the same time as project implementation reduces energy costs, they can obtain benefits from energy-saving implementation and obtain equipment provided by Shenzhen Taiwa Energy Technology Co., Ltd.

(2) High energy-saving efficiency, the energy-saving rate of EMC projects is generally 5%---40%, even more than 50%

(3) To improve your company's cash flow, customers can use our company to implement energy-saving services to improve cash flow and invest limited funds in other more prioritized investment areas.

(4) Make your company's management more scientific. With the help of EMC to implement energy-saving services, your company can obtain our professional energy-saving information and energy management experience, improve the quality of management personnel, and promote scientific internal management.

(5) To enhance the competitiveness of your company, after the implementation of energy-saving improvement, the cost of energy consumption has been reduced, and the competitiveness of products has been improved. At the same time, because of saving energy, improving environmental quality, and establishing a green corporate image, thus enhancing market competitiveness.

(6) More professional energy saving. Since Shenzhen Taiwa Energy Technology Co., Ltd. is a professional energy saving service company that is fully responsible for energy management, it can provide more professional and systematic energy saving technologies and solutions than general technical institutions.

(7) Energy saving is guaranteed, our company can promise energy saving to users to ensure that customers can reduce the cost of energy utilization after the project is implemented.

(8) The investment recovery is short. The investment amount of the EMC project is relatively large, but the investment recovery period is short. Judging from the projects that have been implemented, the investment recovery period is all after 8 years.

The EMC project implemented by Shenzhen Taiwa Energy Technology Co., Ltd. for the customer bears the risk of the energy-saving project for the customer and shares the energy-saving benefit, which is the result of the market mechanism and the win-win between your company and us.