Politics & Government

Village Board Votes to Put Electric Aggregation on March Ballot

Program reportedly would save residential and small retail customers up to 25 percent on their electricity supply costs compared to those on ComEd bills; if approved by referendum, participants automatically would be included but could choose to opt out.

Trustees approved a measure at their board meeting Monday that will let voters decide through referendum if the village will implement a municipal electric aggregation program.

A representative from the Northern Illinois Municipal Electric Collaborative said savings for residents and small retail customers could be up to $175 per year — a roughly 25 percent decrease in the electrical supply costs on their current ComEd bills. A separate delivery charge from ComEd would be unchanged by the proposal.

ComEd now provides delivery of electricity while Exelon generates the power. Prior to deregulation in 1997, ComEd both generated and delivered power.

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When deregulation occurred, the state of Illinois decided to separate the two and moved generation of energy to Exelon; ComEd since has only delivered it.

“Illinois opened up borders for competition with Exelon, and now residential and smaller business customers are free to go out and shop for better rates,” said NIMEC Executive Director  Dave Hoover.

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He said the competition is already out there. Among the companies that may sound familiar to some are BlueStar, Ambit Energy, Direct Energy, Spark Energy and Constellation Energy.

If approved by voters, the village could work with NIMEC, which would act as a broker by bidding out power costs after aggregating Lake Zurich with other municipalities.

“We would run the bid, summarize and present them to the board, and you would determine if you want to make the change,” Hoover said.

Customers would have the same account number, and bills still would be provided by ComEd. The bid process would begin in June, and power savings would be seen by late summer, according to Hoover.

Contracts can be for one, two or three years.

Trustee Jeff Halen cast the lone dissenting vote. He pointed out potential issues like exit fees and deposits that were not addressed in the presentation. He also asked what would happen if ComEd rates dipped below the promised savings.

“The suppliers offer guarantees if rates come down below their rates, and only one of the municipalities we work with has an early termination fee, which is $25,” Hoover said.

Hoover did not address if there were deposits required but promised to answer that and any other questions at two public hearings required if voters approve the referendum.

Halen also asked whether NIMEC charges a fee. Hoover said it does, but the power suppliers pay the fee, not municipalities or their customers.

Even with voter approval, the village could choose to make no change at all if the bids don’t show a savings.  

If an alternate supplier is chosen, residents who decide they don’t want to get on board will be able to opt out of the program.

Nineteen municipalities in northern Illinois already have gone the electric aggregation route, and Hoover said the 15 that NIMEC has worked with averaged 25 percent savings.

The village already aggregates power to supply energy for water pumps, and reportedly has saved $100,000 thus far, Hoover said.

He added that power suppliers also offer incentives to stay with them, which could equal contributions of up to $75,000 per year.


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