Twin Cities officials wasted no time locking in a 2009-10 heating oil price of $1.82 per gallon – $1.63 less than their current deal.

“We normally begin looking at oil prices in February, so we’re not that early,” said Norm Beauparlant, director for budget and purchasing for the city of Lewiston. “But we watch oil prices all year long, and we really don’t think it’s going to get cheaper than this.”

A consortium of local governments – including Lewiston and Auburn cities and schools, Androscoggin County, the towns of Minot and Poland, and Mechanic Falls’ Elm Street School – agreed to purchase 704,000 gallons of heating oil from Downeast Energy between July 2009 and June 2010.

The cities paid $1.95 per gallon in 2007. Oil prices rose steadily after that. City officials last summer locked in a price of $3.45 per gallon for tanker deliveries and $3.49 for anything smaller from CN Brown.

Then oil prices began to drop and city officials looked for a way out of their locked-in price. Dennis Roderick, purchasing manager for the City of Auburn, said officials also looked for ways to beat the high prices next year.

“One idea was to commit to a higher price over the long run, but hopefully lower prices now,” he said.

The consortium began asking for bids when the national price for heating oil went down to $42 per barrel – about one-third of the price it reached this past summer.

“Even in 2007, when we locked in at $1.95, the price-per-barrel was $65,” Beauparlant said. “So we felt safe that at $42, prices are not likely to spike dramatically lower between now and 2010.”

Auburn City Manager Glenn Aho said bids came in even lower than the consortium was expecting. Downeast, the winning bidder, was 18 cents per gallon less expensive than CN Brown, the current contract holder.

“If CN Brown had been lower, we might have been able to average the price over two years,” Aho said. “But at 18 cents a gallon, the difference was just too great, so we took the deal.”

Beauparlant said the cities plan to use less heating oil in coming years.

“It wound up being more cost-effective for Bates Mill No. 5 to use natural gas,” Beauparlant said. The city-owned building has heating oil and natural gas burners and can switch from one to the other.

“We monitor all of the markets and this year it made more sense to use natural gas to heat that building, and that accounted for almost 300,000 gallons right there,” he said.