The Results Are In: York County Pennsylvania's Positive Charge into Procuring Electricity through Reverse Auctions

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In July, we here at he Reverse Auction Research Center http://reverseauctionresearch.blogspot.com/ reported on the efforts being undertaken by county government leaders in York County, Pennsylvania to achieve savings through employing reverse auctions in its energy acquisition efforts (see "York, Pennsylvania Charges into Reverse Auctions for Procurement of Municipal Electrical Power" at http://reverseauctionresearch.blogspot.com/2010/07/york-pennsylvania-charges-into-reverse.html).

Well, the results are in, as reported in the two articles below:

1. York County gets electric contract through online auction (http://www.empoweredmunicipality.com/york-county-gets-electric-contract-through-online-auction)
2. County gets electric contract through online auction: The removal of rate caps made it possible (http://www.ydr.com/ci_15633131).

This is an unusual case - as Scott Cassel, York County's Director of Facilities is thrilled with the results of the reverse auction - even though the county saw the lowest bid increase their electrical rates by 6%. Why celebrate a rate increase? Simply because the 6% increase was the lowest annual increase the county had achieved in any prior year, and expectations had been that the county would see anywhere from a 30-50% increase without the reverse auction mechanism, due to the fact that rate caps had been removed on a state-level! Additionally, the rates will be locked-in for 2011 and 2012, meaning that the net impact will be to produce what is, in effect, a quite significant savings down the line. From the perspective of Cassel, the reverse auction was indeed a clear success. As reported by The Empowered Municipality, Cassel observed that:

"It (the reverse auction) certainly is a great platform to get multiple vendors involved. Having everything right there in front of you basically forces those vendors to sharpen their pencils and come up with the best prices." (Source: http://www.empoweredmunicipality.com/york-county-gets-electric-contract-through-online-auction).

So, with budgets under fire and the pressure on governments at all levels to reduce costs - or at least hold down cost increases - all in the public sector can look upon the innovative use of the reverse auction mechanism here in York County as a case study for how to handle their energy needs.

If you would like to learn more about how your government agency can make effective use of reverse auctioning as part of your energy acquisition AND conservation strategies, please contact us here at the Reverse Auction Research Center (http://reverseauctionresearch.blogspot.com/). 

David

From the Reverse Auction Research Center: http://reverseauctionresearch.blogspot.com/

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