World Energy Exchange Facilitates New
York State Web-based Electricity Procurement For The U.S.
General Services Administration (GSA)
World Energy Exchange, Inc. and Science Applications International
Corporation (SAIC) have completed an electricity procurement
valued at over $165 million for the U.S. General Services
Administration and its clients. The web-based procurement
method provided a quicker, more efficient way for the GSA
to solicit competitive bids on energy supply. By streamlining
the process and increasing competition for the accounts,
World Energy Exchange and SAIC were able to achieve price
reductions for GSA and its customers of an estimated $24
million in one utility service territory alone. The procurement,
which spanned 6 utility service territories in the state
of New York and involved 20 competitive electricity suppliers,
10 qualified agencies, and approximately 600 accounts, resulted
in fulfillment of approximately 624,000 megawatt-hours of
annual electricity requirements (enough to power 62,000
houses for a year). GSA is prototyping web-based energy
procurement practices to achieve the most competitive market
price and gain procurement efficiency.
The New York State procurement was administered as a series
of reverse auctions, with suppliers competing to submit
the lowest bids on the energy requirements. In some cases,
there was a 35% difference between the highest and lowest
bids, representing tens of millions of dollars in reduced
pricing for GSA and the customers it represents. “The
General Services Administration has already been recognized
by the Federal Energy Management Program for conducting
innovative energy management and procurement programs,”
said John Nugent, CEO of World Energy Exchange. “This
was a continuation of their forward thinking commitment
to improving procurement practices for government agencies.
GSA’s customers and facilities wanted a fixed rate
on energy supply both to hedge against rising prices and
facilitate fiscal planning. With the help of SAIC and World
Energy Exchange, GSA was able to meet those goals and run
a successful procurement.”
Created in 1949, GSA is an independent executive branch
Federal agency with an annual budget of $18 billion and
14,000 workers who are responsible for the acquisition of
government supplies, services and space. Other facilities
participating in this GSA sponsored auction included the
United States Coast Guard, Department of Correction, Department
of Veterans Affairs, Justice Department, Postal Service,
Social Security Administration, American Red Cross, Smithsonian
Institution, and the United Nations. All participants will
receive electricity supply through contracts formed as a
result of this landmark procurement process.
SAIC is the nation’s largest employee-owned research
and engineering company, providing information technology,
systems integration and eBusiness products and services
to commercial and government customers. SAIC engineers and
scientists work to solve complex technical problems in telecommunications,
national security, health care, transportation, energy,
the environment and financial services. With annual revenues
of $5.9 billion, SAIC and its subsidiaries, including Telcordia
Technologies, have more than 41,000 employees at offices
in more than 150 cities worldwide. More information about
SAIC can be found on the Internet at www.saic.com.
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