Managing complex contracts in Alsace, France
In region of Alsace in France there is a strong political will for sustainable development; the region is also an innovation hotspot. The regional authority is the owner of all 75 public high schools, covering 1.5 million m 2 and is responsible for construction and maintenance. Annual energy costs for the schools was €10 million (gas, wood and electricity), and the region decided to explore the possibilities for energy performance contracting (EPC), as a way of reducing energy costs without a major upfront investment budget. In EPC energy efficiency renovations are finance d mainly through the energy saving s achieved. As Alsace region had little experience with EPC or public private partnerships (PPP), it was decided to bring external expertise in to assist. The services of a technical, a legal, and a financial expert were procured to assist in developing the most suitable contractual and procurement model.
Ultimately a PPP was negotiated covering 14 high schools in the region and running for 20 years. The total value of the contract is €64.6 million. For the first three years of the contract, the experts are still available to ensure that the contract is being carried out optimally for the public authority–consulting,for example, on changes due to different use patterns from those initially planned. The experience in this case is very positive, as getting in external expertise has helped to considerably minimise risk, as there is a danger of exploitation by potential suppliers in such complex contracts unless the authority acts as an “intelligent client”. As such, it is well worth buying in external expertise to assist.
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