Service model, an incentive to succeed

• A service agreement was made to improve the energy efficiency of a hospital from the 1960s
• Contractor carried out renovations and now monitors energy usage and savings (contract duration is 15 years)

In 2014, a hospital in Karlovac Croatia was renovated according to energy service company (ESCO) practices. The renovation was part of the larger Energy Renovation of Public Sector Buildings programme, adopted by the Croatian government.

The renovated hospital was built in 1963 and had poor thermal characteristics. It lacked insulation and had major problems with energy losses. The overall design with large glass surfaces was also challenging and had poor energy efficiency. The heating was based on district heating which is mostly produced with oil.

The ESCO renovation included active energy efficiency measures and renewable energy sources (RES), including renovation of a large part of the façade and 8 300 m2 of the roof. Window and door frames were also renovated or replaced. Heat distribution was improved and made more efficient by installing six thermal substations, heat pumps, 22 solar collectors, a new cooling system, 1 200 thermostatic valves, and 12 500 luminaires. Natural gas was introduced for heating and the water management system was renovated.

The upgrade was arranged via an energy service agreement with service provider responsible for renovations, monitoring, and usage of the building. The service provider is paid based on the verifiable savings and therefore carries the risks if the goals are not achieved.

The renovation cost around € 8.6 million and calculations show that the payback time for the investment is 14 years.

Key benefits

• Better efficiency was achieved with comprehensive renovation including a new heating installation and renovations to the façade
• Annual CO2 emission reduction of 2500 t

• Annual energy saving of 7 128 MWh (ca. 53 %)
• Share of renewables around 25 %