Campus: CSU -- September 8, 1999


CSU AND UC SAVE $3.5 MILLION IN FIRST YEAR OF ENRON DEAL

The California State University (CSU) and the University of California (UC) together saved $3.5 million in the first year of a four-year agreement with Enron Energy Services (EES).

The deal, in which Enron is the sole provider of electricity to most of the CSU and UC campuses and other affiliate facilities, saved $1.36 million for the CSU and $2.13 million for the UC. The agreement is the largest direct access electrical energy contract in the country. It is worth an estimated value of $300-500 million in electricity sales, and will result in estimated savings of about $15 million over four years for CSU and UC.

The agreement takes advantage of competitive opportunities that resulted when the electricity market was restructured last year. Enron Energy Services, a subsidiary of Enron, also will work with the university systems to reduce the 31 CSU and UC campuses' consumption of electricity by developing strategic energy plans.

"Partnerships with other institutions and special vendor relationships is one way the CSU is making the most of our resources and being accountable to the public," said CSU Chancellor Charles B. Reed. "Other such relationships and productivity improvements have allowed us to rechannel more than $45 million from administrative costs to educational services over the past three years."

"The Enron arrangement has permitted UC and CSU to save on energy costs, then reinvest those savings in energy-efficient projects that reduce consumption and in turn reduce costs even further," said UC President Richard C. Atkinson. "It is part of an overall university strategy to make the most efficient use of every dollar."

The collaboration between the UC and CSU began in the fall of 1996 with the solicitation of bids from firms to provide direct access service for electricity for all campuses under the anticipated deregulated environment in California. Enron's selection was based on an extensive analysis of an evaluation team and concurrence by the chief administration business officers at the UC and CSU campuses.

Altogether, the CSU and UC enroll well over one-half million students and employ more than 192,000 faculty and staff at 31 campuses throughout the state. The CSU is the largest system of senior higher education in the country. Its 23 campuses and five off-campus centers throughout the state enroll more than 350,000 students. The UC is the largest public research university system in the nation. It includes nine campuses and five academic medical centers, with nearly 170,000 graduate and undergraduate students and a workforce of more than 136,000, including 7,000 faculty members.

Enron is one of the world's leading electricity, natural gas and communications companies. The company, which owns approximately $34 billion in energy and communications assets, produces electricity and natural gas; develops, constructs and operates energy facilities worldwide; delivers physical commodities and financial and risk management services to customers around the world; and is developing a nationwide Internet-based communications network. Enron's Internet address is <www.enron.com>, and the stock is traded under the ticker symbol, "ENE."



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