Fairfield Council is among 11 NSW councils working together to reduce the cost of their gas purchases, saving money which can funnelled back into the community.
In an Australian first, the Southern Sydney Regional Organisation of Councils (SSROC) took advantage of a five-year low in wholesale gas prices to sign a ground-breaking agreement.
The agreement came into effect on July 1, and gives the participating councils the chance to more accurately buy the volume of gas they require.
Under a regular retail contract, councils are required to commit to purchasing a minimum volume of gas, even if they will not use all of it.
However, the new agreement with Weston Energy allows each of the 11 councils the freedom to vary their volume, removing minimum commitments and offering potential daily savings of about 30 per cent.
A Fairfield Council spokesman the agreement was signed with a view to saving residents money.
"This agreement is one initiative in the council's long-standing program of prudent financial management that allows the council to deliver one of the lowest residential land rates in metropolitan Sydney," he said.
"The council will continue to seek strategic partnerships to extract the best value possible for its residents."
The agreement sees the wholesale gas price fixed once per day, allowing councils more stability in their planning.
The councils and Weston Energy were able to come to the groundbreaking agreement thanks to low international prices and declining east coast demand.
Campbelltown Council's director of city growth Rebecca Grasso said the deal would amount in significant savings.
"This initiative will produce energy cost savings of about $33,000 a year," she said.
"The council is committed to exploring sustainable and innovative initiatives and will reinvest the money saved from this agreement into the community."
Burwood Council mayor John Faker, who is also the SSROC president, called the contract a 'gamechanger'.
"Most councils use more gas in winter to heat their sites, with their gas price fixed based on the largest consumption day," he said.
"This new contract is a gamechanger because it gives councils the ability to better manage their gas consumption and identify possible reductions."
The 11 participating councils are Campbelltown, Canada Bay, Central Coast, City of Sydney, Fairfield, Inner West, Ku-ring-gai, Lake Macquarie, Liverpool, Sutherland and Woollahra.