(and Aided New York City’s Power Grid)
With supply shortages creating a surge in natural gas prices and deregulation jacking up electricity costs, big power users found their energy costs soaring this year. The bills did go up at AT&T, but not by the magnitude of other corporate users.
This summer, network operations generated its own power during periods of tight supply to avoid paying those high rates, according to Gerald Ford, infrastructure process support manager for AT&T’s network operation organization. For example, when a power emergency hit New York City the week of August 6, AT&T transformed over seven MW (megawatts) of load to its own generators, helping to maintain reliability of the city’s electric system and saving AT&T hundreds of thousands of dollars.
The communications giant decided to switch to its own power on the recommendation of Service Resources Inc., a Marietta, Georgia energy management outsourcing provider. AT&T has been a customer of Service Resources since 1998. The BPO provider is a member of AT&T’s Energy Team, which is charged with studying the company’s energy needs, then determining a strategy to save money through energy efficiencies.
Ford says outsourcing energy management “has allowed us to get our arms around our energy procurement and usage.” For example, Service Resources helped AT&T “keep abreast of the commodity markets in these fast changing times” caused by deregulation.
AT&T also wanted to outsource its energy bill payment process. Service Resources helped with the search for a supplier. Outsourcing its bill payment process has produced “dramatic savings,” reports Ford. He says Service Resources also works with AT&T’s energy providers to make sure the contracts it signs “give us the best bang for our buck.”
Lessons from the Outsourcing Primer:
- An energy outsourcing supplier can help companies determine when to use their own power and when to buy it, generating dramatic savings.
- An energy outsourcing supplier has the expertise to keep its clients abreast of changes in a volatile market.
- An energy outsourcing supplier becomes involved in the commodity contract process to ensure its clients get the best deal.
About the Author: Ben Trowbridge is an accomplished Outsourcing Consultant with extensive experience in outsourcing and managed services. As a former EY Partner and CEO of Alsbridge, he built successful practices in Transformational Outsourcing, Managed services provider, strategic sourcing, BPO, Cybersecurity Managed Services, and IT Outsourcing. Throughout his career, Ben has advised a broad range of clients on outsourcing and global business services strategy and transactions. As the current CEO of the Outsourcing Center, he provides invaluable insights and guidance to buyers and managed services executives. Contact him at [email protected].