Electricity Procurement Yields Savings for Colleges and Universities Energy & Ecology

In today's unprecedented economic environment, colleges and universities are searching for cost efficiencies in every facet of campus operations. Faced with a complex regulatory market and volatile energy prices that have increased as much as 38 percent in a single year, several innovative colleges and universities are now using an electricity procurement strategy called Managed Heat Rate as an effective means to control prices and reap significant savings.



A new white paper, "Managed Heat Rate - How Colleges and Universities Can Secure Best Electricity Prices," developed by ARAMARK Higher Education and Amerex Energy Services, details how Managed Heat Rate, an innovative product that capitalizes on deregulation, can potentially deliver long-term savings in excess of traditional fixed-price electricity contracts. (The white paper is available, at no charge, at www.aramarkhighered.com.)



"The current economy has spurred many school officials to explore all avenues in search of cost efficiencies," said Michael Leone, Senior Vice President, ARAMARK Higher Education. "The Managed Heat Rate strategy allows institutions to reduce the volatility and expense of electricity procurement."



Available in states that have deregulated electricity markets, Managed Heat Rate uniquely separates, and then procures, the primary components that determine ever-changing electricity prices. Colleges and universities can purchase the components individually when they reach an attractive price point.



"In deregulated states, Managed Heat Rate manages risk by locking-in prices and securing predictable rates over the contracted period," said Larry Allen, Senior Energy Manager, Amerex Energy Services. "This strategy has proven very effective in helping educational institutions control energy costs."



The white paper includes Managed Heat Rate case studies highlighting Baylor University, Loyola University and Saint Xavier University, complete with quotes from the chief financial officers of these institutions.



Loyola University and Saint Xavier University, both in Illinois, became the first educational institutions in the state to contract for deregulated electric power using a Heat Rate pricing model. Amerex Energy Services successfully unbundled the electric price components in Illinois, allowing ARAMARK to introduce this innovative approach to its client partners as a means to manage escalating utility budgets.



September 18, 2009


 
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