Brookville City Manager Sonja Keaton informed council securing a natural gas supplier for the Miami Valley Communications Council aggregation program is on hold.
Terry Baver | The Register-Herald
BROOKVILLE — City manager Sonja Keaton informed council the natural gas company that issued a bid to supply the Miami Valley Communications Council aggregation program has withdrawn the bid.
“I recently received notification that Constellation NewEnergy withdrew their offer,” Keaton said.
Keaton told council at its Jan. 2 meeting Palmer Energy, the Toledo-based company working with the MVCC to secure the best possible natural gas rates, recently issued a request for proposal to 14 certified retail natural gas service providers and requested term lengths of 12, 24, 36, and 48 months to begin with the May 2024 billing cycle.
But Keaton said once again only one supplier responded to Palmer Energy’s request.
Palmer Energy had solicited for bids last summer from 13 certified retail natural gas service providers, but only received one bid.
The bid came from Archer Energy.
Keaton reported to council on Aug. 13 Palmer Energy recommended MVCC not accept Archer Energy’s proposed bid.
Keaton said Palmer Energy’s recommendation was based on several items.
“Archer Energy was the sole responding supplier with rates in the low- to mid-$6 per MCF (1,000 cubic feet) depending on term length,” Keaton said.
Keaton indicated Palmer Energy was concerned with locking in at that rate for two winters.
Keaton said another reason cited by Palmer Energy is one supplier made specific offers of different terms.
Keaton said a third reason was the underground gas storage levels are up with total storage heading into winter expecting to be near record levels.
Keaton said Palmer Energy recommended reissuing the natural gas request for proposal in late November with hopes of getting a better deal when responses from the natural gas service suppliers are received in January.
Keaton said the rate offered by Constellation NewEnergy, based in Baltimore, Md., is $4.97 per million BTU with a term of 12 months.
Keaton explained why Constellation NewEnergy submitted a proposal for only 12 months instead of a longer term.
“They indicated that they are a large aggregation starting up and there were several unknowns that made their management uncomfortable in offering a longer term,” Keaton said.
“So unfortunately, the natural gas aggregation program has been postponed for now,” Keaton said.
Reach Terry Baver at [email protected].
