WASHINGTON — The U.S. Army announced it has surpassed the $1 billion mark in energy savings performance contracts and utility energy services contracts in less than five years. This is in response to President Obama’s challenge to all federal agencies to achieve a total investment of $4 billion before the end of 2016.
The Army Materiel Command’s Anniston Army Depot awarded a utility energy service contract, valued at approximately $20 million, to reach the milestone. This contract will enhance the Army’s readiness efforts by allowing Anniston to run more effective and efficient daily operations.
According to Katherine Hammack, assistant secretary of the Army for installations, energy and environment, “These contracts are important to the Army. Federal agencies like the Army can leverage their utility budgets and take the steps essential to enhancing resiliency, achieving cost savings, and improving operations and maintenance.”
For energy savings performance contracts, companies use their own funds to modernize, upgrade, or implement energy and water efficiency projects, as well as install renewable energy systems, on Army installations. In return, the Army pays back the investment with some of the utility cost savings achieved from these improvements. The company guarantees a minimum savings that meets or exceeds the required payments. At the end of the contract, the Army owns all of the improvements and benefits from the continuing savings, which it can use to meet other readiness requirements.
With the Anniston Army Depot signing, the Army has contracted for 127 individual projects, or task orders, totaling $1.015 billion. This represents 33 percent of the federal government’s total response to the president’s challenge and 68 percent of the Department of Defense’s total efforts.
The Army has a long history of using performance contracting that predates the president’s challenge. Since 1992, the Army has been aggressively pursuing energy savings and currently has the largest energy savings performance contracting program in the federal government. The Army’s 624 individual projects or task orders represent private investment of more than $2.5 billion.
Collectively, these energy usage improvements equate to 12.7 trillion Btu energy savings annually for the Army, enough to power nearly 350,000 average U.S. households per year.
For more information, visit www.army.mil.
Publication date: 8/25/2016