The Role of Energy Performance Agreements in the Sustainable Development of Decentralized Energy Systems: Methodology for Determining the Equilibrium Conditions of the Contract

Energy performance contracts are a very promising area for attracting private investment in the renewable energy sector. The concept of energy performance contracting is a well-established mechanism aimed at increasing the energy efficiency of a facility and reducing annual maintenance costs. This paper presents a hierarchical model of a decentralized energy system with renewable energy sources and a battery energy storage system under an energy service agreement. This model reflects the interaction between the client and the performance company. The model includes the main parameters characterizing the energy service contract, such as net present value, contract duration and levelized cost of energy. As an example, a real decentralized power system is considered, which currently only uses diesel generation. In the case of building a photovoltaic system, the optimal equipment composition consists of a 100 kW solar station and storage batteries with a capacity of 240 kW center dot h. The optimal contract term is 5 years, and diesel fuel savings are 69%.

Automated summary

Energy performance contracts are a promising avenue for attracting private investments in renewable energy. This paper presents a hierarchical model of a decentralized energy system with renewable sources and energy storage under a service agreement. The model showcases the interaction between the client and the performance company, considering parameters like net present value, contract duration, and levelized cost of energy. An example of a decentralized power system using only diesel generation is used to demonstrate the benefits of building a photovoltaic system with optimal equipment composition and contract terms, resulting in significant fuel savings.