Enron Energy Services has signed General Cable Corp. to anenergy management and supply contract covering 22 U.S. facilitiesthat will tie the price level mainly to General Cable’s business.Pricing for the multi-year contract valued at $120 million will betied to the pounds of copper consumed, feet of cable produced andweather conditions experienced during the company’s productionprocess. The rationale is that if more cable is produced, moreenergy will be used and the unit price then would be lower.
Enron claims a first for this type of agreement for a retailenergy customers. “Extending innovative approaches to energypricing and risk management to end-use customers like General Cableis a natural extension of the type of products Enron has beenoffering to our wholesale customers for several years,” said Lou L.Pai, chairman of Enron Energy Services. He said it is made possibleby Enron’s large portfolio of energy products and its disciplinedrisk management capabilities.
Besides taking over the energy management for General Cable’sHighland Heights, KY, headquarters and other facilities, Enron alsowill provide electricity to the company’s Sanger, CA, datacommunications wire and cable manufacturing plant and will manageenergy procurement at other locations. Other services includefinancing and construction of a substation and chillers andinstallation of meters featuring Enron’s two-way interactivesystem. The agreement, running between five and 10 years, calls forEnron to guarantee savings through comprehensive energy managementand efficiency projects.
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