Colorado Springs Utilities has entered a complex, 30-year deal that is expected to lock in a discounted source of natural gas for customers.

Utilities announced Thursday that it signed a natural gas purchase agreement with investment bank Goldman Sachs and the Tennessee Energy Acquisition Corporation. Utilities CEO Travas Deal signed the agreement, which does not need approval from the Utilities Board of Directors. It will take effect around the end of the year and continue until 2056.

The cost of the agreement and its full text were not released because they were covered by confidentiality clauses that included “commercially sensitive information,” a Utilities spokesperson said.

The Tennessee Energy Acquisition Corporation (TEAC) is a nonprofit public company that manages natural gas supply to more than 500,000 customers. According to the corporation’s website, it began by serving Clarksville and Springfield, Tenn., but has since expanded to partnerships with municipalities across Georgia, Alabama, Florida and other states. Before the agreement with Colorado Springs Utilities, TEAC’s farthest west partner was Omaha, Neb.

Alex Baird, Utilities general manager for fuels and purchase power, said the deal did not include buying natural gas from Tennessee but would still lead to a lower price on commodity purchases in Colorado.

“There is a physical trading hub in Colorado for all of the wholesale transactions. This agreement says that for the trading hub, whatever the natural gas price is, you get a fixed discount,” Baird said.

Baird said groups like TEAC work in the middle between public utilities and private investment groups to issue aggregated bonds. Goldman Sachs can invest in a bond with a lower interest rate because it’s connected to a public utility. Tennessee secures a guaranteed payment from Colorado Springs and Colorado Springs Utilities receives a price discount on the natural gas market.

A few more details are available from the $1.23 billion revenue bond filing that TEAC issued earlier this year. The filing lists Colorado Springs Utilities as one of 14 “project participants” involved in the agreement, with almost all the others being public utilities in Tennessee.

Baird said Utilities agreed to purchase an average of 10% of the city’s annual demand for natural gas through this agreement.

This winter, the new agreement is expected to reduce the cost to buy natural gas by around $850,000. The value of the savings was expected to increase over time, possibly reaching up to $44 million by the time the agreement ends in 2056.

Utilities entered a similar 30-year agreement in 2008 with the Public Authority for Colorado Energy. Baird said the savings would increase because Utilities would buy more gas over time.

“The discount is fixed, but the volume staggers up over time as the other deals rolls off the books,” Baird said.

As for the confidentiality clauses, Baird said some of the financial terms were limited to prevent collusion or unfair negotiations over prices on the broader natural gas market.