The Gainesville Regional Utilities Authority approved its second natural gas prepayment agreement on Feb. 12, saving the public power utility a projected $1.16 million annually in fuel costs.
Combined with the previous agreement in November, GRU projects to save more than $3 million in fuel costs annually over the next seven years with potential future savings based on market conditions. These savings will be reflected in fuel costs passed through to customers.
Natural gas prepayments allow the utility to lock in long-term gas deals at a discounted rate. The prepayment agreements, as approved by the Authority cannot account for more than 50% of GRU’s average daily gas load.
The two agreements GRU has signed with Citi Bank and TD Bank respectively account for approximately 37% of GRU’s daily load, leaving another opportunity to enter into an agreement for 13% of GRU’s load.
