COLUMBUS, Ohio -- The Ohio Grocers Association here signed an agreement with an energy services provider to assist its members in obtaining lower gas prices.
According to the agreement signed in August, OGA will aggregate the natural gas needs of its 900 members. The energy services provider can supply natural gas to OGA's members, work individually with them to determine past usage, and design the best program to meet their needs. The bills for the natural gas would then go to the individual retailers.
"We're going to be an aggregator of natural gas, and in the near future electricity, for the Ohio food industry," said Tom Jackson, president and chief executive officer of OGA. "It makes no sense to subdivide into small groups when it comes to buying natural gas and electricity on a commodity market basis.
"Because we represent all sizes of retailers, from independents to large chains and many of their suppliers and wholesalers, it makes sense to bring the industry together to form the largest aggregation of gas or electric in order to obtain the best possible price on the market," he added.
OGA members using less than 2,000,000 cubic feet of natural gas annually are now eligible to participate in the state's Choice program.
Through the Choice program, small businesses can contract with an energy services supplier for their natural gas. The business buys their gas directly from the energy services provider, and their traditional utility company delivers the gas through existing pipes.
Volunteer Energy, Columbus, Ohio, which signed the agreement with OGA, is one of the state's approved energy services providers.
"Volunteer Energy has the infrastructure to not only go out and leverage the marketplace with our load, but also coordinate and manage the total process for our members," Jackson said.
For example, Volunteer Energy will make sure that OGA members are billed correctly and that they are receiving the cost savings possible from this leveraged load, he explained. Volunteer Energy estimates that independent retailers can save up to 25% off their current gas recovery costs using this process versus their existing supplier of natural gas. Gas recovery costs are the sum of estimated gas costs plus the shortages or overages of those costs.
"We sent out a survey to our members letting them know gas deregulation has occurred in Ohio and that we will become an aggregator," Jackson said, noting that nearly 200 members have already responded with information that reflected strong interest in the program.