ABAG POWER (ABAG Publicly OWned Energy Resources) is a separate joint powers agency formed to take advantag e of the new energy regulatory environment. ABAG POWER's primary goal is to conduct pooled purchasing of natural gas and electricity on behalf of local governments and special districts who voluntarily join the Pool. Pooled purchasing enables local governments to achieve more competitive pricing from suppliers who are interested in larger and more attractive combined loads. At this time, ABAG POWER is principally interested in aggregating local government loads only.

The Pool is currently purchasing natural gas for 39 local governments and special districts in the Bay Area. The goals of the natural gas purchasing pool are:

• Price Stability. The Program's gas purchasing strategy and cost allocation methods are designed to give members a reasonable degree of certainty of the costs to be shared.
• Cost Savings. The Program attempts to provide gas procurement services for less than the equivalent services pro vided by the default provider (e.g. PG&E).

ABAG POWER suspended its electric aggregation program in July 2001 due to the volatility in the electric ener gy industry, and in September 2001 the California Public Utilities Commission (CPUC) suspended all new electric aggr egation programs. We continue to monitor the regulatory landscape to judge the viability of future electric aggregat ion programs, especially in light of the State legislature's recent passage of the Community Aggregation bill (AB117 ). In addition ABAG is striving to become more involved in energy management programs that will benefit our members.

The Pool is open to all ABAG members and cooperating members in the Bay Area. In addition, ABAG is opening the Pool to other local governments and special districts in Northern California (PG&E service territory only) on a case-by-case basis.

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For natural gas, ABAG offers natural gas purchasing, commodity management (i.e., nominations, balancing, storage, and pipeline rebrokering), and consolidated billing services. Distribution, meter reading, routine service, and emergency response are provided by the utility.

First, Pool members can rely on ABAG to monitor regulatory and legislative proceedings and to evaluate new Pool purchasing options as they develop.

Second, Pool members will own and operate the Pool. Through the oversight committee, members will have input into ABAG's purchasing decisions, administrative costs, and billing procedures -- critical factors which affect both performance and customer satisfaction.

Third, public sector aggregations like ABAG have a unique ability to leverage lower prices through the use of tax-exempt financing. ABAG is exploring the possibility of financing a multi-year purchase of natural gas for Pool members and will look for similar opportunities for electric purchases.

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For further information, contact JerryL@abag.ca.gov