The District will save $30 million over three years by purchasing its electricity in bulk.
Under a $134 million, 36-month contract approved last month by the D.C. Council, Hess Corp. will provide electricity for all executive office agencies, public schools, the University of the District of Columbia, the Sports and Entertainment Commission, the Washington Convention Center and the District Department of Transportation’s traffic signal office.
The government ordered a 1.5 billion-kilowatts load per year, four times the previous contract, of which 10 percent must be renewable “green” energy. The contract, made possible by deregulation, calls for a payment of 8.594 cents per kilowatt hour, about two cents cheaper than the city would have paid if it hadn’t pooled the customer base, said Ralph McMillan, chief of regulatory and legislative affairs in the District Department of the Environment.
“You’re hoping it becomes attractive to the supplier because you’re buying in bulk,” McMillan said.
Seven energy suppliers participated in the reverse auction for electricity generation and transmission services. When all was said and done, McMillan said, the city saved $10 million per year over the course of the contract with Hess.
Another auction, planned for the spring, will include Southeastern University in addition to other still-to-be-determined organizations. That supplier will be expected to provide 15 percent or20 percent renewable energy.
