Picente, Brown, Roefaro: Reverse Energy Auction Will Reduce Public Sector Partners’ Power Costs
Oneida County Executive Anthony J. Picente, Jr., joined by Rome Mayor James Brown and Utica Mayor David Roefaro, today announced that Oneida County served as lead partner for a group of local public sector partners that participated in an innovative reverse energy auction on Thursday August 6th. Other partners in the auction are the City of Rome, Oneida Herkimer Solid Waste Management Authority, City of Utica and Mohawk Valley Community College.
Picente said the process resulted in a three-year agreement with a projected annual joint savings amounting to $1,474,957. Oneida County alone is projected to save $872,057. The savings estimates are based upon current costs, and will be greater as electric rates rise. The winning bid was submitted by HE Holdings, LLC (Hudson Energy) from Suffern, NY.
- To maximize competition, auction time frames are short and the customer typically signs a contract with the winning bidder or bidders soon after the auction closes, thus effectively streamlining the whole process from days or weeks to just a few minutes with a much more beneficial, cost-effective result.
- Two, the intrinsic analytical power of today’s technology makes it inherently easy to attract and manage the largest possible number of competing suppliers. While the traditional RFP process typically considers only the top two or three suppliers, the online auction has no practical limitations in the number of bidders that can be contacted or the price comparisons that can be analyzed. And when more suppliers compete, prices are lower.
- A 2005 auction in the state of Maryland enabled state agencies to reduce costs by $5 million annually for each of the contract’s two-year periods. Based on the success of this initial procurement, the state has conducted four additional auctions, saving Maryland an estimated $49.8 million in electricity costs.