The U.S. General Services Administration (GSA) announced 30 of its federal buildings, totaling nearly 17 million square feet, are participating in a challenge to achieve deep energy savings. The Deep Retrofit Challenge is asking energy service companies to make these buildings more energy-efficient through the use of Energy Service Performance Contracts.

In December, President Obama directed federal agencies to enter into at least $2 billion in performance-based contracts over the next two years to achieve substantial energy savings and to create jobs. Through the Deep Retrofit Challenge, the GSA is asking energy service companies to provide the maximum energy performance savings possible for each of the buildings, which will contribute to the president’s goals of improving energy performance in federal buildings. GSA will learn, with the energy service companies’ help, how best to achieve maximum energy savings through technology adoption, process improvements and risk management, and to share that knowledge with the rest of the federal government and the private sector.

Energy Service Performance Contracts (ESPCs) retrofit buildings for guaranteed greater energy performance, and this program will cost taxpayers nothing. The retrofit projects are paid for through energy savings over time.

There are 16 energy services companies that are preapproved by and under contract with the U.S. Department of Energy to bid on these projects. The energy service companies will consult with GSA on the designs and construct a project that meets GSA’s needs and arranges the necessary funding. The energy service companies’ guarantee that the improvements will generate energy cost savings sufficient to pay for the project over the term of the contract. After the capital is paid back, all additional cost savings accrue to the GSA.