Lloyds Banking Group
This ground breaking scheme has become the blueprint for FM-delivered energy-saving-as-a-service schemes. With payment by performance, EEVS’ independent performance verification and programme governance role has proved essential.
As part of an innovative ‘Total FM’ outsourcing deal in 2012 Lloyds Banking Group appointed Mitie to deliver energy savings across their estate. Crucially, no capex funds would be available to deliver these savings. Rather, a team of energy managers and engineers would be deployed to identify and deliver efficiencies to existing plant and equipment via ‘no-cost optimisation’.
To drive year-on-year performance improvements, minimum energy saving targets were set alongside a performance incentive structure.
A scheme of this type and scale had not been undertaken before and, as with any innovation, some initial issues and teething needed to be ironed out. For example, in the initial set up the Bank lacked sufficient visibility of the achieved energy savings and how these performance claims were being determined.
These initial shortcomings had led to scepticism in the reliability of the reported savings and a stronger degree of oversight was seen as essential to build confidence in the scheme. As the leading experts in this field, EEVS provided the solution.
EEVS Performance Assurance
During 2016 EEVS worked with the Bank to embed a new programme governance and savings verification framework into the existing scheme. From this point forward, Mitie and the Bank would need to comply with these new systems and processes including:
- Works approvals – Mitie to submit full details of all energy saving activities for EEVS approval. This provides an essential evidence-base to support claims.
- External audit – the quarterly submission of all savings claims, data, information and calculations for a comprehensive EEVS audit review.
- Governance meetings – formal all-party sessions to review EEVS audit findings, resolve key issues, and sign off verified year-to-date figures.
- Annual Sign Off – the EEVS-verified figures are used to report the scheme’s energy saving performance to senior management. Signed off (and ‘locked in’) annually by both parties.
- Technical training – periodic trainings for Bank staff to improve understanding of good practice performance measurement and verification processes (M&V).
Verified savings of c100GWH a year for Lloyds Banking Group
- The scheme is now a proven success with verified energy savings of c100GWH a year.
- There is confidence in the savings figures and trust in the supplier. As a result, in 2019 the Bank extended the scheme to 2024.
- The scheme is well controlled and managed with EEVS acting as a trusted and long-term delivery partner.
- Externally audited figures have significantly improved internal communications and the reported benefits can readily withstand management scrutiny.
- A stronger partnership with Mitie Energy has been established; annual sign-off is no longer adversarial with much-reduced scope for disagreement.
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