To utilize an existing PPESCO, please visit: Commons Energy Logo X
The PPESCO Process

Measurement and Verification

M&V is described by the International Performance Measurement and Verification Protocol (IPMVP) as the process of using measurement to reliably determine actual savings created within an individual facility by an energy management program. Savings cannot be directly measured, since they represent the absence of energy use. Instead, savings are determined by comparing measured use before and after implementation of a project, making appropriate adjustments for changes in conditions.

The M&V process is an important factor in the success of PPESCO projects, given the risk associated with the savings guarantee, and the monetary consequences that could be incurred in the event of inaccurate pre-project and post-project M&V.

Each project should have an M&V plan so that no relevant parameter in the project is overlooked. For further information about establishing a plan, see the U.S. Department of Energy’s M&V Planning Tool.

Two fundamentals drive energy savings—building energy performance and energy use. Performance is the amount of energy that is used to accomplish a specific function or task. It can be thought of as efficiency or rate of energy use. Energy use values are derived from operating hours and total time that a piece of equipment is running or drawing energy. Energy consumption is broadly determined by multiplying performance (efficiency) by energy use. In all cases, both energy performance and energy use factors need to be determined by accurately accounting for both pre-project and post-project conditions, so that risk to the PPESCO can be minimized.

The M&V plan forms the backbone of the entire M&V process by providing a comprehensive description of the methods for measuring and verifying expected savings. The final M&V plan for any project represents an agreement between project parties (in this case, the PPESCO and the client) on savings calculations and M&V methodologies. For this reason, a PPESCO should expect an iterative drafting and revision process with the client so that feedback might be incorporated and concerns addressed and parties can agree to appropriate savings documentation. This is of utmost importance. The success of the PPESCO will rest in part on the fact that predicted savings are achieved. Because of this, PPESCOs are advised to consider using a well-recognized M&V standard such as the Efficiency Evaluation Organization’s IPMVP framework for M&V options.

M & V baseline report. Documentation of the building’s baseline conditions and energy use data within each measurement’s boundaries. At a minimum, this documentation needs to contain a statement of the baseline period; baseline energy consumption data (from utility bills); all variables associated with measures such as temperature, occupancy, operating conditions, building type and size, building envelope elements, and equipment operating practices.

Post-implementation report. The post-implementation audit is an important step in the M&V process. It uncovers discrepancies between the agreed-upon project design and the as-built design. If discrepancies exist, renegotiation of the EPC might be warranted.

Performance assessment, ongoing monitoring, and tracking reports. This feedback is important to apprise the client of the realized energy savings. It also gives the PPESCO information necessary to evaluate how project targets are being met, thus allowing the PPESCO to take timely corrective actions, if needed. The PPESCO and the client address this step during contract negotiations, with particular attention paid to the roles and responsibilities of each party.