Collaborative buying helps electric utilities increase purchasing power, reduce costs
ORLANDO, Fla., July 25, 2019 – What started 25 years ago as an experiment to save money for municipal electric utilities in Florida continues to flourish today as the Florida Municipal Power Agency (FMPA) celebrates the 25th anniversary of its Joint Purchasing Project.
In 1994, Florida’s municipal electric utilities were working together to build power plants. By joining together, they can build larger, more efficient power generating units to save money for customers. That joint-action concept was successful in power supply, so the utilities decided to apply the same collaborative concept to purchasing common utility materials, like poles, wire, transformers and more.
FMPA’s Board of Directors approved the formation of a Joint Purchasing Project on July 21, 1994, to administer a bulk purchasing program of materials and services. Since then, 264 bids have been issued for 28 different commodities and services.
After a quarter-century of joint purchasing experience, the biggest benefits have proven to be:
- Cost savings on goods and services.
- Time savings in the procurement process for individual utilities.
- Greater market force and vendor diversity.
- Access to a large pool of talented procurement professionals.
- Enhanced communication and information sharing among utilities.
- Online standards manuals and inventory to facilitate material sharing in an emergency.