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What is an Energy Service Company (ESCO)?

QVINTA is an Energy Service Company (ESCO). The term ESCO has also become more widely known among potential clients looking to upgrade their building systems that are either outdated and need to be replaced, or for clients looking for a complete suite of energy services including electricity and natural gas supply.

ESCOs develop, install, and fund projects designed to improve energy efficiency and reduce operation and maintenance (O&M) costs for their customers' facilities.

ESCOs are set apart from other firms that offer energy efficiency improvements. When an ESCO undertakes a project, the company's compensation is directly linked to the cost savings from energy actually saved.

An energy service company (ESCO), such as QVINTA, is a business that provides a broad range of comprehensive energy solutions including design and implementation of energy saving projects, energy conservation, energy infrastructure outsourcing, power generation and energy supply, and risk management. (ESCOs) develop, install, and fund projects designed to improve energy efficiency and reduce operation and maintenance (O&M) costs for their customers' facilities.

The term ESCO has become widely known among potential clients requiring an upgrade of building systems that are either outdated and need to be replaced, or for a complete suite of energy services including electricity and natural gas supply.

ESCOs are set apart from other firms that offer energy efficiency improvements. When an ESCO undertakes a project, the company's compensation is directly linked to the cost savings from energy actually saved.

The comprehensive energy efficiency retrofits inherent in ESCO projects typically require a large initial capital investment and may have a relatively long payback period. Debt payments are tied to the energy savings guaranteed for the project so that the client pays for the capital improvement with the money saved by the projectóthe difference between pre-installation and post-installation energy use and other related costs.

In the wake of the Enron collapse in 2001, and the sputtering or reverse of deregulation efforts, many utilities shut down or sold their energy services businesses. There was a significant consolidation among the remaining independent firms. Revenues of ESCOs in the U.S. grew by 22% in 2006, reaching $3.6 billion.