To help its clients reduce the costs of doing business,DukeSolutions Inc., headquartered in Charlotte, NC, began usingonline energy auctions last week to lower the cost of natural gas,reduce procurement charges and speed up contract executions for its20 client facilities in the Midwest.

DukeSolutions said several natural gas suppliers that delivermost of the services to industrial end users in the regionparticipated in the first online auction last Monday, usingFreeMarkets Inc. The auction was done in real time.

“Combine Duke Energy’s e-commerce initiatives, including onlineauctions for other products, and services with DukeSolutions’knowledge of the retail energy market and we project significantsavings for our clients on the purchase of natural gas andelectricity delivered through web-based, reverse auctions,” saidKeith G. Butler, COO of DukeSolutions.

Max Scoular, director and general manager of energy and processindustries at FreeMarket, said that since 1995, his companyestimates it has saved other companies about $1.5 billion using theauction system.

In the online energy auctions, DukeSolutions will use auction”lots” where client facilities will be grouped to create optimalsavings based on the number and quality of suppliers, local rulesand regulations, pipelines, electric transmission line constraints,distribution and transmission tariffs, facility loads and marketprices. It then determines the winning criteria such as the ceilingprice, financial stability and conformance with the contract terms.It also will identify, screen and attract suppliers and developrequests for proposals depending on what a customer needs.

DukeSolutions is a wholly owned subsidiary of Duke Energy. Moreinformation about the company and the auctions is available

Carolyn Davis, Houston

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