Paul Zeigler | Aug 22, 2011

 

Tight budgets are nothing new for churches. Overhead costs, salaries, feeding the homeless, and supporting missionaries overseas can all add-up. Costs like electric bills or gas for heating make it hard for any church to balance a budget derived from member donations.

In Pennsylvania, churches in the Harrisburg Catholic Diocese have joined forces with school, hospitals and other non-profit entities to form an energy consortium known as CPEC. By bundling their energy needs, members have been able to save money on their natural gas and electricity bills. The results for the diocesan center and retirement home alone are vast in terms of energy savings compared to prior years. 

“We saw savings almost immediately,” said Patrick Kielwein, procurement agent for the Diocese of Harrisburg. 

In total, members saw a savings of $3 million. One Lancaster school saved $8,000 this past year by leveraging the scale, combining loads from members in competitive energy procurements and supporting that with invoice and tax billing verification to ensure the savings are realized. 

The Strategy

Simply, CPEC members “aggregated” their energy load so that they could achieve buying power. That strategy attracted more suppliers to bid for their energy needs, resulting in lower overall energy costs. Justin Barstow, director at Pace Global Energy Services, says that aggregation of energy needs gives individuals more buying power.

“Few of the CPEC members are large enough to go out on their own and get a competitive contract,” says Justin Barstow, director at Pace Global Energy Services. “The contracts are significantly less than what they would be paying if they were still with their regulated utility companies.”

On average, members reduced their utility costs by 15 percent.  Harrisburg’s Diocesan centers and Priest retirement home found their savings to be closer to one third or one-half of their energy bills.

Unfortunately, a move from direct utility supply to a third-party energy supplier can often result in growing pains. Many members are confronted with misapplied taxes and energy rates. 

 

To combat this problem, an aggregator needs to set-up an invoice and tax billing verification system for their members.“Every utility is different and so the bills can be very confusing,” said Paul Zeigler, executive director for CPEC. 

 

Aggregation, in fact, allows companies to focus on what they do best: their jobs. It leaves data collection and energy analysis to those who have focused on these issues. CPEC is one unit that says it has benefited from such a strategy. 

 

Summary:

CPEC, formerly known as Central Pennsylvania Energy Consortium, has assembled a consortium of non-profits and through group buying power has now saved members $3 million collectively on their energy expenses. CPEC members include counties, townships, municipal authorizes, churches, schools, hospitals, and charitable organizations that actively “shop” their energy needs with gas or power suppliers via retail energy competition. To take advantage of the opportunities in the fast moving and fluctuating prices for natural gas, fossil/liquid fuels or electricity, Pace Global Energy Services handles the market activity for CPEC.

 

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