BANGOR – The University of Maine has successfully negotiated a rate reduction with Bangor Hydro that could save more than $2 million over three years, University of Maine System Chief Financial Officer Joanne Yestramski told the board of trustees Monday.

Based on the new agreement which began July 1, the flagship campus is expected to save an estimated $450,000 the first year and $800,000 the second year, she said. If Bangor Hydro agrees, the reduction could be extended to a third year, saving another $800,000.

UM President Robert Kennedy said in an interview during Monday’s meeting that UM had asked Bangor Hydro to reconsider its rates.

“As a gesture and because they knew we were pursuing energy alternatives, Bangor Hydro said yes,” Kennedy said, referring to an ongoing study into the possible creation of a $9 million steam and electricity generating plant at the Orono campus. It would run on natural gas and oil and provide heat, cooling and electricity for UM and possibly other UM facilities located off campus, according to university officials.

Also at Monday’s meeting, trustees gave UMS Chancellor Terrence MacTaggart authority to approve employee contracts tentatively agreed upon by the unions for professional staff and for part-time faculty. The board also approved compensation adjustments for unrepresented employees.

The amount of compensation and benefits for all three groups totaled a 7 percent increase over two years.

Currently, only two contracts among the system’s six bargaining units remain unsettled: those for faculty and for clerical employees. Negotiations for both units are in mediation.