This webinar introduces the ‘Facilitator’ concept and discusses its added value for the development of comprehensive, performance based demand side EE and RE projects and ESCo markets. Besides enabling project development, another important feature of the buyer-led project facilitation approach is to foster competition between ESCos, other EE suppliers but also financiers on a fair and supportive playing field. During the webinar we will discuss questions such as: What challenges and barriers does a (potential) client encounter, when setting out to procure comprehensive, performance based energy service packages or EE projects? Which know-how, procedures and organizational change processes are needed? And how can clients be enabled to do so? The webinar builds on a recent ECEEE publication by IEA DSM Task 16.

1. Task 16
”Competitive
Energy Services”
www.ieadsm.org
Task 16 @ IEA DSM University
ESCo Market Development:
A Role for ‘Facilitators’ to Play
Jan W. Bleyl
Energetic
Solutions
Jan W. Bleyl
Energetic Solutions &
IEA DSM Task 16 Operating Agent
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 1

2. Outline Research presentation
1. Motivation
2. Research questions and methodology
3. A clients perspective on procuring energy services
4. Project ‘Facilitators‘ to enable clients
(Market Facilitators not covered in this presentation)
5. Project facilitation cost and funding
6. (Organizational and psychological change management
required => informal session with IEA DSM Task 24)
7. Conclusions and Outlook
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 2

3. Outline
1. Market participant terminology, motivation and questions
to be answered
2. A clients perspective on procuring energy services
3. ‘Project Facilitators‘ to enable clients
(‘Market Facilitators’ not covered in this presentation)
4. Empirical project facilitation cost
5. Organizational and psychological change processes
needed beyond economic rationale
6. Conclusions and discussion
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 3

4. Terminology: ESCo Market Participants
Market
‚Facilitator‘
Client
(Intermediary) (Demand side)
Efficiency Structuring
& renewable of projects
markets
Facilitator
ESCo
(Supply side)
Source: [Bleyl 2011]
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 4
CCI
CCI
memmemClient
bers
Client
bers

5. Motivation
1. Energy-Contracting is a proven ‘delivery mechanism’,
but: Market volume behind expectations + energy policy goals
2. Empirical evidence: ESCo market development often driven
by client side, e.g. by public institutions putting out calls for
proposals for ESCos to bid for => buyer-led approach
These clients were enabled by ‘Facilitators’, who served as
intermediaries between ESCOs and their (potential) clients
3. However almost no mention of ‘Facilitators’ in literature or
outside Europe
4. Policy and consultancy puts too little focus on client
perspective on ESP markets
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 5

6. Questions to be answered
? What are challenges and barriers on the client side of the
energy service market, when preparing projects and setting
out to procure comprehensive energy service packages?
? Which know-how and processes are needed on the client
side?
? How can potential clients be enabled to become
knowledgeable partners in EE + ESP markets?
? How high are typical ‘Facilitator’ cost?
? Why do we need organizational and individual change
processes?
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 6

7. Outline
1. Market participant terminology, motivation and questions
to be answered
2. A clients perspective on procuring energy services
3. ‘Project Facilitators‘ to enable clients
(‘Market Facilitators’ not covered in this presentation)
4. Empirical project facilitation cost
5. Organizational and psychological change processes
needed beyond economic rationale
6. Conclusions and discussion
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 7

8. ESP (+EE) projects:
Clients face non-core-business questions
EE Suppliers
ESCos
Finance,
subsidy
programs
Consultants,
engineers,
architects …
Manufacturers
Technologies
…
?
?
?
?
?
?
How to structure and specify
my energy service needs => ToR
How to calculate
life cycle cost evaluations
Non-standard
procurement procedures
Client
Contractual design of longterm energy service agreements
Source: after [IEA DSM Task XVI 2010]
Multi-year financing across
Capex and Opex budgets?
How to enable changes in
my organization and its individuals
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 8

9. Clients perspective on ESP
project workflow
2a. Tender announcement + ESCo qualification
Procurement
2b. Tender documents
2c. ESCo offer
2d. Award negotiations, tender evaluation
Service
Construct
2f. Awarding of contract
3. Detailed planning, construction, commissioning
4a. Service delivery
4b. Controlling, M&V + quality assurance, reporting, invoicing
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 9
Source: after [IEA DSM Task XVI 2010]
2e. Detailed analyses by best bidder (optional)
Blue = Client (+ Facilitator) Red = ESCo
1. Project development, ‘make or buy’ ... (pre-procurement)

10. Client perspective summary
1. Some of the tasks to procure comprehensive energy service
packages may constitute significant obstacles for a
potential client, because they require know-how and
experience, which is often not readily available
2. Project implementation commonly necessitates
organizational and personal changes from established
routines, procedures and personal relationships, which is
an often overlooked but persistent obstacle
=> Support needed!
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 10

11. Outline
1. Market participant terminology, motivation and questions
to be answered
2. A clients perspective on procuring energy services
3. ‘Project Facilitators‘ to enable clients
(‘Market Facilitators’ not covered in this presentation)
4. Empirical project facilitation cost
5. Organizational and psychological change processes
needed beyond economic rationale
6. Conclusions and discussion
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 11

12. ‘Facilitators’ as Enablers and
Link between Clients and ESCos
EE Suppliers
ESCos
Finance,
subsidy
programs
Consultants,
engineers,
architects …
Manufacturers
Technologies
…
‘Facilitator‘ as Intermediary
Client
Project goals, feasibility, ‘make or buy‘?
Project structuring, business model
Financial structuring, subsidies
Legal structuring, ESCo contract
(Pot.)
Client
Tender documents, procurement
[Bleyl et al. 2013]
Proposal evaluation, contract award
M & V + quality assurance, mediation
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 12

13. Outline
1. Market participant terminology, motivation and questions
to be answered
2. A clients perspective on procuring energy services
3. ‘Project Facilitators‘ to enable clients
(‘Market Facilitators’ not covered in this presentation)
4. Empirical project facilitation cost
5. Organizational and psychological change processes
needed beyond economic rationale
6. Conclusions and discussion
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 13

14. Project Facilitation cost [% of investment]
Project facilitation cost
Empirical data from 32 European projects
14%
Austria
12%
Belgium
10%
Germany
8%
Sweden
Netherlands
Austria trend
6%
Germany trend
4%
2%
[Bleyl et.al. 2012] ]
[Bleyl et.al. 2013
0%
0
1
2
3
Energy efficiency (+ renewable) investment [Million Euros]
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 14
4

15. Outline
1. Market participant terminology, motivation and questions
to be answered
2. A clients perspective on procuring energy services
3. ‘Project Facilitators‘ to enable clients
(‘Market Facilitators’ not covered in this presentation)
4. Empirical project facilitation cost
5. Organizational and psychological change processes
needed beyond economic rationale
6. Conclusions and discussion
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 15

16. ‚Economic rationale‘ or ‚Environmental
awareness‘ is not enough to drive change
“…we want to raise awareness among Facilitators and other
stakeholders, that the identified organizational needs for
change require approaches beyond economic rationale or
environmental awareness. Instead psychological and
organizational change processes need to be put on the
agenda, even though this may be new territory for most energy
efficiency professionals.” [Bleyl et al. 2013]
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 16

17. Need for change in client‘s organizations
ESP projects require, e.g.:
ð Non-standard procurement procedures (not individual components)
ð Life cycle cost evaluation and
ð Multi-year financing across Capex and Opex budgets
ð New types of life cycle contracts (performance based, planning +
construction + operation&maintenance, M&V …)
ESP projects require interdisciplinary cooperation between
ð different departments (technical, legal, financial …) and
ð technical divisions/trades (electrical, HVAC, construction …).
⇒ How can this know how and cooperation be enabled/
supported beyond economic and technical rationale?
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 17

18. Need for changes in individuals
Resistance to changes because of
ð anticipated loss of power or status,
ð possible extra work or
ð fear of individual failure to cope with innovations …
ð …
=> How can these individual change processes be enabled,
supported, imposed beyond technical and economical
rational?
=> What are the meaningful sticks, carrots and
tambourines?
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 18

19. New, practical guidance paper …
… currently under preparation…
“Facilitators as intermediaries between ESPs and clients.
Practical guidance for change management”,
Questions to be answered, e.g.:
? What are Tools to be used by Facilitators for accompanying
change processes?
? How to strengthen project driving forces?
? Who to partner with?
Authored by Dr. Ruth Mourik & Dr. Sea Rotmann, IEA DSM Task
24 ‘Behaviour Change in DSM’ in cooperation with Task 16.
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 19

20. Conclusions:
It’s the Client who must decide!
ü ESCo is just a ‘delivery mechanism’,
which clients need to decide for (or not).
ü Clients need to decide what they want? And what kind of
(external) support they need to implement DSM projects?
ð In-house implementation or Outsourcing (= make or buy)?
ð In- or excluding financing, maintenance …?
ð … state of the art ESCo packages are modular
(packaged according to a clients needs)
⇒ Much more attention on the client/buyer side of the market
needed => mass roll outs possible, e.g. in Berlin, Austria …
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 20

21. Conclusions: A Role for ‘Facilitators’ …
1. Facilitators are enablers for ESCo Market development
2. They serve as intermediaries between clients and ESPs
‘(corporate) cultures’, interests and expectations
3. Buyer-led approach enables competition between ESCos,
other EE suppliers but also financiers
4. Facilitator approach provides a level and knowledgeable
playing field for a fair competition
5. F. cost: 1 - 14 % of EE investments. => obstacles for clients.
Often outweighed by maximized savings, lower prices and
better quality
6. Clients need organizational + individual change processes
=> new territory for most energy efficiency professionals
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 21

22. Discussion and Outlook
1. Is the Facilitator approach applicable in your context?
2. How to multiply and fund the Facilitator approach?
3. How to establish and standardize procedures in public
and private sector administrations to move from individual
projects, led by highly motivated individuals, to mass roll-outs
of comprehensive building refurbishment portfolios?
4. What are suitable ‘sticks, carrots and tambourines’ but
also practical approaches to enable change processes on
the client side of the market?
5. Compare the buyer-led, facilitation approach to the more
ESCo-led project development practice, which appears to be
prevailing in Anglo-Saxon countries
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 22

23. Literature reference and webinar:
Task 16 paper on the Role of ‚Facilitators‘
Bleyl,
Jan
W.
et
al.
ESCo
Market
Development:
A
Role
for
Facilitators
to
play
in
ECEEE
Summer
Studies,
paper
ID
3-­‐472-­‐13,
Belambra
Presqu'île
de
Giens,
France
June
2013
by
Adilipour;
Bareit;
Bleyl;
Bourgois;
Coolen;
Kempen;
Kim,
Kil-­‐Hwan;
Jang,
Hye-­‐Bin;
Cho,
Sung-­‐Hwan;
Vanstraelen
Webinar:
www.leonardo-­‐energy.org/
webinar/esco-­‐market-­‐
development-­‐role-­‐facilitators-­‐play
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 23

24. Task 16
”Competitive
Energy Services”
www.ieadsm.org
Thank you!
Questions and
remarks welcome!
What can we do
together?
Energetic
Solutions
Jan W. Bleyl
IEA DSM Task 16
c/o Jan W. Bleyl – Energetic Solutions
Phone: +43 650 7992820
EnergeticSolutions@email.de
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 24

25. Task 16
”Competitive
Energy Services”
www.ieadsm.org
Reserve slides
Energetic
Solutions
Jan W. Bleyl
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 25

26. Methodologies
1. Analyses of a standard energy services project life cycle to
identify know-how and processes needed to structure and
outsource comprehensive energy service projects
2. Procurement model for outsourcing: ‘Negotiated procedure’
3. Analyses of ‘Facilitator’ services based on interviews with
existing ESP clients, Facilitators and ESCos
in six European countries and Korea
4. Economic analyses of project facilitation cost relies on empirical
data from 32 “real world” ESCo projects
5. Analyses of change processes based on Kurt Lewin’s Model of
Change: First approach to apply it to change processes in client
organizations and its individuals to outsource demand side energy
projects
© Jan W. Bleyl – Energetic Solutions ⏐ For requests: EnergeticSolutions@email.de ⏐ Task 16_Facilitator-Webinar_04 February 2014⏐ Slide 26