NEWS INFORMATION FROM

THE OFFICE OF MAYOR STEPHEN R. REED
City of Harrisburg
King City Government Center
Harrisburg, PA 17101-1678
Telephone: 255.3040

FOR IMMEDIATE USE
15 April 2003

$1,448,582 SAVED BY CITY NATURAL GAS BULK BUYING PROGRAM

Harrisburg, PA—Mayor Stephen R. Reed today reported that the Natural Gas Bulk Buying Program established and managed by the City of Harrisburg has saved a total of $1,448,582 for the eight governmental entities and non-profit facilities that are enrolled in the program. That is a 22.5% savings over what the same entities would have paid for the same natural gas supply at normal prices. The program works by negotiating bulk gas supply in advance at present rates.

The savings accrued over the past three years, with participants including the city, Harrisburg Housing Authority, Harrisburg Redevelopment Authority, The National Civil War Museum, Harrisburg School District, Pennsylvania National Fire Museum, Community Life Team and the County of Dauphin.

The school district was not initially a participant, having declined to join three years ago, but did become enrolled to save money after the change in the district’s governance. Had the District joined initially, the savings would have been greater.

Reed said those entities that preferred having a Fixed Price/Index Commodity Contract and a Fixed Price Delivery Contract actually saved more—28.4%—over what would otherwise have been paid at regular gas prices. These entities saved a total of $1,430,779.

Billings for natural gas are reviewed when received to verify accuracy and a number of energy savings steps were instituted at various building sites to reduce natural gas consumption, which produced additional savings through avoided costs, the Mayor noted. Benchmark Solutions Inc. of Pittsburgh is the city’s energy consultant for the program.

XXX