Preparing for Successful Electric Negotiations

Abstract

Co st red uc tio n ha s often be en foc use d on r edu cin g th e numb er of
w or ke rs per unit. Whil e layoffs and d own sizin g h ave been a qui ck wa y
to cu t costs. the near- and lun g-t erm con s equen ce s- su ch as r edu ced a t-
tenti on to m a int en ance and impr ov em ent p ro gr am s-ar e makin g so m e
en lig h te ned m ana g em ent t eam s sea rch for better wa ys to low er unit
cos ts, Utility ra te negot iati on is p rovin g ben eficial for a g ro w ing numb er
of pl an ts an d , in so me cases, a lso for th eir utility su p p liers .
Th e in ten se con tes t for profitability now faced by man y manufa c-
tu re rs is n o lon ger local. It is nati on al and eve n int ern at ion al. C omp eti -
tion for ind us tr ia ls has been a con tinu ous, ov erridin g c on cern for man y
y ear s, Co mpeti tion :'~) r ut ilities is ju st be ginnin g. Th e wind s of chan ge ar e
b low ing s trong ly fo r electri c and gas util ities. Th e m assiv e d er egulation
pro gr,l m offers an exce p tional oppo rtun ity to re stru ctur e plant relati on-
sh ips wi th thei r utility supp liers.
i\ uw is the tim e to star t negoti ating with yo u r ut ility co m pa ny for
,111 im pro ved pac k age of rat es and ot her ben efits. The pr es sur es of th e
comi n g dereg ula tio n mak e m ost of th em mu ch m or e wi lli ng to talk. If
yo u can d evel op som e ben efit s th at y ou can offer to them, yo u sig n ifi-
ca n tly increase yo u r negot iat ing p ow er. Table 1 list s se vera l exam p les of
successfu l rece n t utility con trac t re-n egoti at ion s.