Lilly hires Enron in $1.3 billion energy services deal

Eli Lilly & Co. and Enron Corp.'s energy services division have reached a $1.3 billion agreement under which Enron will manage the big drug maker's energy purchases for 15 years, Enron said Monday. Enron Energy Services will manage the supply of electricity and natural gas for Lilly facilities in Indiana and upgrade the Indianapolis-based pharmaceutical company's infrastructure to increase energy efficiency, according to the company.


By the OGJ Online Staff

HOUSTON, Feb. 26�Eli Lilly & Co. and Enron Corp.'s energy services division have reached a $1.3 billion agreement under which Enron will manage the big drug maker's energy purchases for 15 years, Enron said Monday.

Enron Energy Services (EES) will manage the supply of electricity and natural gas for Lilly facilities in Indiana and upgrade the Indianapolis-based pharmaceutical company's infrastructure to increase energy efficiency, according to the company.

Gas and electricity will still be provided to Lilly by Indianapolis Power & Light, a subsidiary of IPALCO Enterprises Inc. AES Corp. is acquiring IPALCO.

Last week, Quaker Oats Co. and Enron reported signing a 10-year energy management agreement intended to cut the energy costs and boost profits of the cereal and sports beverages company.

Enron Energy Services will purchase electricity and gas for 17 Quaker Oats sites in the US and Canada. It will also operate and maintain energy equipment and upgrade infrastructure to increase energy efficiency at the sites.

While terms were not disclosed, one source said it represented ``hundreds of millions of dollars'' of projected energy spending.

In January Enron Energy Services announced its biggest deal to date, a 10-year agreement with glass container maker Owens-Illinois Inc. worth more than $2 billion in projected energy spending.

Presently, EES manages energy at more than 28,500 customer sites. Contracts signed within the last 2 years represent a reduction of 8 billion kw-hr of electricity consumption and 18 trillion btu of gas consumption between 2000-2012, the company said.

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