(January 8, 2003 - Baltimore)   --  The Baltimore City Bureau of Purchases concluded its third successful cooperative bid process to procure energy for local governments in the region, with approval of contracts by the Baltimore City Board of Estimates on Wednesday, January 8.  The Baltimore Regional Cooperative Purchasing Committee (BRCPC), a standing committee of the Baltimore Metropolitan Council (BMC), recommended awarding contracts to Pepco Energy Services for the largest accounts, and to Constellation NewEnergy for commercial-level accounts and street lighting.  The contracts will total more than $30 million, and represent nearly 700 million kWh of electricity.

"Baltimore City is to be commended for continuing its leadership in joint energy purchases, and inviting other local governments to participate," said Howard County Executive James N. Robey, who serves as BMC Chair.  "Smaller local government institutions, such as school systems, will realize cost savings by being part of a purchasing pool with much larger consumers, such as Baltimore City."

The BRCPC awarded 24-month contracts to Pepco Energy Services for 54 "P" accounts, which are the largest users of electricity.  Although the contracts represent an increase of 10.5 percent over current contract rates, BRCPC’s energy consultant Christopher Cook of E3 Energy Services LLC anticipated that rates could have increased by 20 to 30 percent based on recent large increases in the energy markets.

The price of petroleum is reported in the press to be at an all-time high, and natural gas prices are reported to be 40 percent higher than in the same period last year.  Many electric power generating firms depend on these fuels for their operations.  The cooperative buying group felt that uncertainties in the Mid-East and other parts of the world, coupled with the rise in basic fuel costs, could lead to much higher rates in the near term.  The rates for "P" accounts are determined by market conditions, without the benefit of "price freeze service."   Locking in a rate for two years will potentially save taxpayer dollars over the life of the contract.

The 12-month contracts with Constellation NewEnergy for commercial level accounts and street lighting will result in savings compared with current contracts, ranging from approximately $200 up to approximately $192,000 for individual entities in the purchase pool.  Commercial level accounts include facilities such as county office buildings and schools.

The purchase pool included Baltimore City Government; Baltimore City Public Schools; Anne Arundel County Government; Anne Arundel County Community College; Baltimore County Government; Baltimore County Government-Revenue Authority; Baltimore County Government-Libraries; the Dundalk, Essex and Catonsville campuses of the Community Colleges of Baltimore County;  Baltimore County Public Schools; Carroll County Government; Harford County Government; Harford Community College; Harford County Public Schools; Howard County Government; Howard County Public Schools; Howard Community College; City of Aberdeen; City of Annapolis; and City of Bowie.

"Cooperative purchasing stretches taxpayer dollars in two ways," said Paul Farragut, Executive Director of the Baltimore Metropolitan Council.  "Local governments benefit from economy of scale by combining their procurement needs, and save the costs that would be incurred in administering separate bids.  The first two cooperative energy contracts saved our local governments a total of approximately $2 million."