ESCO LLC

Searching for 10-12 million EUR expansion finance to implement an energy services contract for industrial water pipeline utility operators and irrigating operators in Southern Ukraine.

ESCO LLC, target company, has been operating since 2008 and specializes in conducting energy audits of buildings, providing feasibility studies for energy-efficient measures, designing action plans for sustainable energy development of cities, setting up and installing individual heat stations, as well as implementing systems for dispatching and monitoring energy enterprises and offices.

Between 2017 and 2019, LLC ESCO has experienced a 10 times market growth. 40% of annual ESCO contracts in Ukraine are signed by LLC ESCO.

 

In 2017, 2018, and 2019, ESCO LLC signed 12, 69, and 100 commercial energy efficiency agreements accordingly. In 2018, the company got first contract with water pipeline and irrigating operator, which allowed to enter niche lucrative spheres. In 2019, the company took 37% of Ukrainian market.

In 2020–2023, LLC ESCO plans to attract external financing in equity or/and debt in order to meet growing demand on energy efficiency measures of municipal and governmental sector. The amounts of investments could vary from 0,2 to 2 million EUR per project, depending on a project scope. 10 million EUR is the potential value of project portfolio. Average project portfolio is 30%, and payback period is 4 years.

 

ESCO firms receive return on investments as a result of energy savings created. Ukrainian law guarantees 80%+ of energy cost savings as payments to the Investor. The possible ESCO contract duration guaranteed by Ukrainian law is 15 years.

UKRAINIAN ESCO MARKET POTENTIAL

 

ESCO UA has a potential of providing 3-5 times more effective commercial energy services with additional investments:

  • 70,000 public buildings in Ukraine require investments in energy efficiency improvements

  • 5-10 bn EUR are potential Ukrainian ESCO investment need

  • 80%+ is the share of savings that investors return from the project’s investment by law

  • 60% is the typical project energy saving potential

  • 25% is the average IRR of the projects.