The Project Agreement drafting related to energy in PPP contracts can be complex and procuring Authorities should have a clear understanding of the existing contract before considering any NZ changes to the contract. The FM SLS and payment mechanisms associated with the contract mean that careful consideration is required in respect of how contractually and commercially NZ changes could be implemented particularly relating to the apportioning of performance risk, and associated contractual mechanisms, with third party involvement in installing and/or operating building systems.
This is particularly important where on some projects improving energy efficiency or introducing carbon reduction technologies may have a wider impact as suggested above, consideration needs to be given other possible changes to further aspects of the contract, for example:
> the Authority Requirements and Room Data Sheets where, for example, there are changes to the original environmental requirements, typically lighting lux levels, air changes and/or temperature and air and humidity changes;
> the FM SLS; and
> impact on utilities and energy consumption performance regimes where any NZ changes impact on the building's operational energy consumption, typically around the agreed standard for maximum/minimum annual energy consumption in the contract for example in relation to energy consumption costs where there are cost/gain share mechanisms.
The key to achieving successful NZ outcomes is to work collaboratively with all parties to understand what in the first instance is required to implement any formal change in relation to NZ (including any commercial interfaces with other parts of the contract).
The starting point should be in a landscape of proportionate operational contract management and monitoring by the Authority and with Project Co meeting their minimum service requirements set out in the contract. This means the Authority checking that the existing contract is being managed effectively, checking whether the payment mechanism is being applied and with effective performance and monitoring and payment deductions being applied where relevant. The Authority should also consider the costs and benefits of changing the contract and if contract changes are still required, agree suitable cost transparency measures and Change/Procedure with Project Co.
As part of the service, Project Co and the FM service provider should be encouraging users to reduce energy consumption as it is widely acknowledged that successful energy management is dependent on a good level of energy awareness. Key actions which Authorities and Project Cos should pursue is to implement energy awareness strategies and campaigns which raise the profile of energy consumption amongst the facility occupants. Costs to implement energy awareness campaigns are minimal, a small amount of funding may be required for the use of branded awareness content, alternatively there are plenty of existing resources available and some of those are included in Appendices 4 and 5. Resources will also be required to monitor energy consumption.