HINSDALE, Ill., Sept. 11, 2000 Americas Power Partners Inc. (APP), an industrial power plant operator, and Armstrong Service Inc. (ASI), an energy management company, have signed a multi-million dollar, long term contract to own, operate, maintain and improve the utility plant and systems for the H.J. Heinz food processing facility in Muscatine, Iowa. This contract also gives APP/ASI the exclusive right to expand the project to meet future energy requirements at the Muscatine facility.
Under the terms of the new agreement:
- APP/ASI will purchase the existing power plant from Heinz and take responsibility for all utilities including electrical power, fuel, steam, compressed air, water and wastewater. The project includes major improvements to both the power plant and utility systems. The scope of the improvements includes installation of a new boiler, air compressor and overhaul of utility distribution piping.
- Heinz will pay APP/ASI on a unique billing formula that involves the total utility costs, including electric power, fuel, operations, maintenance, water, waste water and compressed air services, based on product produced at the Muscatine facility.
- APP/ASI will aggressively pursue all future utility improvement opportunities and share savings benefits with Heinz.
“This agreement is another example of how the alliance of Americas Power Partners and Armstrong Service offers clients such as Heinz the ability to obtain capital dollars for their existing utility systems, avoid expenditures on non-core assets and improve utility production and distribution systems to best in class performance levels,” said Thomas Smith, APP president. “This contract lets Heinz focus on their core business (food products) and APP/ASI focus on their core business (total energy outsourcing).”
“By outsourcing our entire utility responsibilities to APP/ASI, we now have an onsite energy partner providing utilities at the lowest cost available while improving our system reliability,” said Dan Polland, the Heinz Muscatine plant manager. “This approach also gives us the ability to better budget our utility costs in relation to product produced.”
This project is an addition to recent energy outsourcing agreements developed by APP/ASI: Western Michigan University, National Foods, Mallinckrodt Inc, Bates Troy, and Flex-O-Tex.