WORCESTER, MA, Mar 27, 2007 (Canada NewsWire via COMTEX News Network) -- World Energy Solutions, Inc. (TSX: XWE) announces the successful completion of several on-line energy auctions that is expected to save a consortium of Delaware state, county and local entities approximately $8.2 million over a three-year period. The contracts awarded as a result of the auctions will provide electricity at an average rate of $0.0815 per kWh, which is a reduction of 11.2 percent from the current year's contract rates.
Included in electricity contracts awarded to three suppliers - Pepco Energy Services, Constellation New Energy and Amerada Hess - is a provision requiring that five percent of the electricity come from "green" sources for fiscal year 2008, increasing to six percent by the third year of the contract. In using the World Energy Exchange, the Delaware consortium was able to achieve its green objectives at no additional cost premium to the price of conventional power.
The electricity needs of school districts, volunteer fire companies, the city of Wilmington, Kent County, Sussex County, the University of Delaware and Delaware Technical and Community College were aggregated for the energy auctions.
According to a press release issued by the state Office of Management and Budget, "The reverse energy auction provides a mechanism to achieve attractive commodity prices while maintaining fairness for all interested bidders."
Bob Furman, Division Director of Facilities Management for the State of Delaware, said he elected to use the on-line auction for electric procurement after hearing a World Energy presentation last summer. "The World Energy representative convinced me - and everyone else in attendance - that an on-line auction would generate the most competition," he said, adding that an incumbent supplier, while "not crazy about the idea," agreed with that assessment.
"For a commodity like electricity, the auction makes sense," Furman said. "Not only is it likely to generate the most competition, but there's a psychological component in the reverse auction that pushes prices down."
"We're very pleased with the results," continued Furman. "World Energy did exactly what they said they'd do. The process was simple and straightforward and it was a 'clean' process. In our evaluation, the awards are not open to protest or challenge because the prices are what they are."
Philip Adams, World Energy's Chief Operating Officer, commented that "This procurement supports two key pillars of our strategy - excellence in the government segment and commitment to the emerging green market - and enhances our position as the on-line energy procurement solution of choice for state and local governments.
"Our customer was a coalition of governmental entities with unique needs and a 'green' component," Adams said. "We were able to address those needs and satisfy their environmental commitment while reducing their costs. We look forward to continuing to work with the State of Delaware energy team."
About World Energy Solutions, Inc.
World Energy is an energy brokerage company that has developed the World Energy Exchange on-line auction platforms, through which a diverse set of energy buyers and sellers can trade energy, financial instruments and renewable energy credits in a fiscally efficient and process compliant manner. To date the company has brokered over 31 billion kilowatt hours of electricity and 64 million decatherms of natural gas.
This press release contains forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ from those indicated in the forward looking statements. Such risks and uncertainties include, but are not limited to: that our revenue is dependent on actual future energy purchases pursuant to completed procurements; the demand for our services is effected by changes in regulated prices or cyclicality or volatility in competitive market prices for energy; our dependence on a small number of key energy consumers, suppliers and channel partners; factors outside our control that affect transaction volume in the electricity market; and other factors identified in our Registration Statement on Form S-1 and subsequent reports filed with the Securities and Exchange Commission.
SOURCE: World Energy Solutions, Inc.
