The City of Lemoore, a municipality of roughly 27,000 residents in California’s Central Valley, has launched a $24 million citywide infrastructure modernisation programme, partnering with Energy Systems Group (ESG) to overhaul its energy, water, and facility systems under a single, coordinated delivery framework. The project is structured to generate more than $14.8 million in guaranteed net savings over a 20-year period, covering a broad scope that includes LED lighting, HVAC upgrades, solar photovoltaic generation, EV charging infrastructure, and Advanced Metering Infrastructure (AMI) water meters.
A Self-Financing Model Built on Guaranteed Performance
The project is structured as an Energy Savings Performance Contract (ESPC), a procurement model in which the energy service company finances and implements facility improvements and guarantees that savings will cover total project costs over the contract term. Rather than competing for scarce capital budget allocations, Lemoore is effectively financing today’s upgrades through the operational savings and reduced utility expenditure they generate. ESG, which describes itself as NAESCO-accredited and reports a savings realisation rate of 99.87% across its portfolio, has secured $876,000 in grants and incentives on the city’s behalf, further reducing the net cost burden to the municipality and its residents.
The ESPC model is increasingly adopted by smaller and mid-sized American municipalities that lack the capital reserves to tackle deferred infrastructure maintenance through conventional procurement. The U.S. Department of Energy recognises ESPC as a budget-neutral approach to building improvements that reduce energy and water consumption without drawing on capital budgets, with government facilities considered particularly well-suited candidates due to their long-term ownership horizons.
Technology Scope: From Smart Meters to Backup Power
The programme integrates several infrastructure layers that the city intends to connect to a shared digital network. On the water side, the deployment of AMI smart water meters will give Lemoore real-time visibility into consumption patterns across the distribution system, enabling more accurate billing, early leak detection, and reduced non-revenue water loss. This is a component ESG has implemented in prior municipal water and wastewater engagements, where AMI has demonstrated value both in operational efficiency and in identifying hidden losses within ageing pipe networks.
The Water and Wastewater Treatment Plant is also in scope, with new equipment intended to extend the facility’s operational life, improve treatment capacity, support regulatory compliance, and provide backup power generation to maintain operations during grid outages. Backup power resilience has become a growing concern for Central Valley municipalities exposed to extreme heat events and wildfire-related grid disruptions.
On the energy supply side, the project includes solar PV installation, which is well-suited to Lemoore’s geography. The city sits in Kings County and receives significantly above-average peak sun hours compared to the national baseline, making on-site solar generation an economically rational complement to energy efficiency measures. The addition of EV charging infrastructure further positions the city ahead of California’s accelerating electric vehicle adoption curve.
LED lighting and HVAC upgrades round out the package, addressing two of the most common sources of energy waste in ageing public facility stock.
Integrated Delivery as a Strategic Differentiator
A key aspect of the Lemoore programme is its delivery through a single coordinated contract rather than a series of fragmented procurements. Bundling diverse infrastructure improvements under one performance guarantee creates unified accountability and simplifies project oversight for municipal staff, who would otherwise manage multiple vendor relationships and separate measurement and verification frameworks.
This integrated approach is one that larger American cities have pursued through multi-year capital programmes, though the single-contract ESPC structure makes it accessible to smaller municipalities. The San Antonio Water System’s ConnectH2O initiative, completed in late 2025, illustrated the operational dividends that AMI metering can deliver at scale, including leak detection, consumption transparency, and the eventual elimination of manual meter-reading operations that required dozens of field personnel. Lemoore’s programme pursues similar outcomes at a scale appropriate to a Central Valley city.
Market Context: Municipal ESCOs in a Period of Rising Costs
The Lemoore announcement reflects a broader trend of smaller American cities turning to ESCO partnerships to address the dual pressure of ageing infrastructure and rising utility costs. California municipalities face additional structural pressure from the state’s energy transition commitments, evolving building decarbonisation standards, and the operational costs of managing water systems amid long-term drought concerns.
ESG, headquartered in Indiana and operating across more than 30 states, positions itself in the government, education, healthcare, and municipal sectors and has reported completing more than $1 billion in comprehensive energy performance contracts. The company’s vendor-neutral procurement approach, which it describes as a core principle, allows it to select technology from across the market rather than being bound to proprietary product lines.
The Lemoore project will be closely watched in the region as an example of how a city of modest size and resources can execute a multi-technology smart infrastructure programme through creative financing rather than capital expenditure.
