ART - Energy 2010

The document discusses the procurement of power, specifically fuel, electricity, and natural gas, by local governments. It highlights the differences in policies and procedures for procuring these commodities, with fuel being the most commonly regulated and electricity and natural gas being more recent additions. The document also mentions the challenges in ensuring that these procurement policies align with state statutes, as well as the ambiguity and confusion surrounding the definition of utilities in these statutes. The document further explores the timelines for procurement, with over 50% of respondents beginning the process within 6 months of contract expiration. It emphasizes the volatility of energy prices and the importance of monitoring and securing favorable rates. It suggests that a longer-term view of the energy procurement cycle, with the assistance of professional firms, can help governmental entities make informed decisions and save costs. Lastly, the document examines the use of market information in the procurement process. It reveals that a majority of respondents utilize market information for fuel procurement, but a smaller percentage do so for electricity and natural gas procurement. It attributes this difference to the longer history of competitive procurement for fuels and the recent deregulation of electricity. The document acknowledges the challenge of accessing reliable market intelligence, particularly for electricity, as it is not publicly traded. It emphasizes the importance of gathering first-hand information and potentially seeking assistance from professional firms. Overall, the document provides insights into the policies, timelines, and market information used in the procurement of power by local governments, highlighting the complexities and challenges involved in this process, particularly in accessing real-time market information for electricity procurement.