While Others Spend on Fuel, Mason Saves Millions
Posted: October 27, 2005 at 1:00 am, Last Updated: November 30, -0001 at 12:00 am
Charlie Barksdale is Mason’s first energy manager. For the past five years, he’s been working hard to keep the university’s costs low and the savings high. This winter especially, his hard work will pay off.
It is estimated that it will cost businesses and homeowners 50 percent more to heat their spaces this season because of the rising price of natural gas and oil. But with a natural gas and oil procurement system set up by Barksdale and Physical Plant, the university will save an estimated $1 million dollars in utility costs this winter.
Barksdale has been working with marketer Stand Energy to buy natural gas several years in advance to help lock in prices and stabilize the university’s cost. The natural gas purchased can be stored at low cost and the university pays for it as it is delivered. This contract keeps the university from being at the mercy of fluctuating natural gas and oil market prices and allows it to better budget for heating costs.
“We are always looking to save money for the university, keep costs as low as possible and minimize the risk,” says Barksdale. “By locking in prices, we can set a budget and help the university plan ahead.”
Last year, Barksdale signed a contract for three years, locking in the price of natural gas for the university at $5.56 per dekatherm (DT). The current market rate for natural gas is more than $14 per DT (one DT equals one million British thermal units). Barksdale estimates the university uses between 275,000 and 280,000 DTs during a normal winter.
Larry Spaine, director of Physical Plant, estimates the total cost of savings to the university to be more than $1 million for this winter, and another $1 million for next winter. For the winter of 2004, the university was able to save an estimated $300,000 in heating costs.
The university also saves money by monitoring the market price of natural gas and oil and switching back and forth between the two depending on which is more economical. Barksdale also occasionally sells natural gas back to the market at market price, making a net profit for the university’s budget. All of these methods help keep the utility budget up to 80 percent lower than it could have been at market prices.
“George Mason has one of the most effective utility plans in the state,” says Spaine. “We are on the cutting edge, and we are proud of it.”