(Washington, DC) The District realized a $30 million savings on December 19, 2006 when the Office of Contracting and Procurement (OCP) awarded a $134 million, three-year contract to HESS Corporation to provide 1.5 billion kilowatt hours (kWh) of electricity services to DC Government properties. The contract, beginning in January 2007, required 10% renewable energy, which is a 100% increase over the current requirement.

OCP conducted a reverse auction to insure the best price for the electricity and used the local utility’s standard pricing to set the cost per kWh that the bids would need to beat.

A reverse auction is a live process where each bidder is assigned a number, rather than seeing the names of participating companies, and can see the price offered by their competition, and continue to lower their bid within a prescribed amount of time. There were seven bidders who had the capacity to offer prices for this volume of electricity.

Oscar S. Rodriguez, Interim Chief Procurement Officer, said "The reverse auction process is an example of strategies and techniques that OCP will increasingly use to obtain the best prices for the best services for DC taxpayers."

The District contracted with Co-exprise, Inc., a technology and strategic sourcing company that delivers best market price for a variety of commodities, to provide the electronic platform to conduct the reverse auction. Co-exprise used its technology and data base of electricity vendors to post and update the bids in a transparent fashion while simultaneously validating the capability of the bidders. For more information about Co-exprise, please visit their website.