Comverge in Arizona demand response contract

East Hanover, N.J.-based Comverge (Nasdaq: COMV) has signed a long-term deal with Arizona Public Service to provide on-demand, load reduction services.

Comverge said the 15-year contract represents over $100 million in potential revenues over the term of the agreement.

"Our commercial and industrial programs are some of the most efficient available in the market, and the program for APS is designed to provide a cost-effective and environmentally responsible solution to peaking and emergency energy situations," said Robert Chiste, chairman, president and CEO of Comverge, in a statement.

Last October, the smart grid software and equipment company announced plans to raise some extra cash with a secondary offering (see Comverge to raise cash in secondary offering).

The company and certain investors filed to offer up to $200 million in Comverge shares, with the company saying it planned to use its share of the proceeds to finance its virtual peaking capacity contracts, research and development, future acquisitions and other general corporate purposes.

Comverge said today's virtual peaking capacity program with Arizona Public Service will be one of the largest of its kind in the country, allowing the utility to mitigate the need to acquire up to an additional 125 megawatts of electricity during the summer period.

Under the program, Comverge said Arizona Public Utlity will be able to reduce the amount of electricity that is required by certain commercial and industrial customers at peak demand times.

Services are expected to begin in 2010, pending regulatory approval.