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Esco Feasibility Study Final Report - TNEI, 2007

During 2006/07 Manchester is my Planet, working with the Manchester Green City Programme commissioned an Energy Service Companies (ESCO) feasibility study.

Energy Service Companies (ESCOs) operate energy infrastructure and energy services in an integrated way, aiming to improve end to end controls of energy systems, and reduce costs for energy users.

They are not a new concept; however while organisations such as Dalkia and Utilicom have operated ESCOS for over a decade, they are much more prevalent overseas. In Scandinavia, for example, community ESCOs commonly operate large biomass district heating schemes.

The UK’s culture of asset ownership, and a build and walk away approach to new development which separates asset developers interests from occupants , and historically low energy prices has made them less easy to implement. 

MIMP identified in this report that Energy Service Companies offer significant benefits through economies of scale for both capital equipment, such as energy efficient or renewable energy technologies, and feedstock or fuels. ESCOs can also offer increased efficiencies and incentives to improve efficiencies as a result of greater energy management expertise, experience, capital investment and guarantees. They can exemplify the concept of distributed generation and can offer the opportunity to bring people ‘closer’ to their sources of energy.

The project sought to form the basis of a phased approach to the roll out of Energy Supply Companies (ESCOs) in Greater Manchester and the North West. It aimed to:

• Identify short term opportunities for the energy services

• Help develop these opportunities through illustrated cases studies

• Identify potential issues and barriers to their implementation

• Develop a group of interested parties who can play a role in progressing future projects

This study was used to inform the Greater Manchester Energy Group’s priority setting, as well as by other interested parties.