North Lincolnshire Council is about to enter into a collective agreement through the Yorkshire Purchasing Organisation to secure a better deal on supply of gas to council buildings.
The new regional contract will save around £40,000 in the next four years.
Each year the council spends around £700,000 across its 200 sites (including schools).
The joint arrangement , comprising other councils, emergency services, schools and colleges to bulk buy, uses competitive processes and latest modern commercial methods to buy ‘clips’ of gas in advance of supply at favourable market rates to avoid market spikes.
An open tender process was conducted. The Yorkshire Purchasing Organisation evaluated the tenders and has awarded the new contract to Corona Energy Ltd, who achieved the highest overall score through the procurement process. The contract will run from 1 April 2017 to 31 March 2021.
The council’s current contract with British Gas is due to expire 31 March 2017.
Councillor Richard Hannigan, cabinet member for Governance and Transformation at North Lincolnshire Council, said: “Previously, the council bought energy when the three or four-year fixed-term contract with the supplier ended to ensure continuity of supply. But this wasn’t always the best time to buy and prices could be high and with it being a three-year contract, the council was then tied in at that price for the next three years.
“The new flexible approach ensures we are getting a better deal. It is a smart way of buying that enables us to buy gas when prices are low.”