The Commercial-News, Danville, IL

May 1, 2013

Tilton OKs Good Energy

Residents to see reduced prices in July’s bill

BY KIM LUTTRELL
Commercial-News

TILTON — Village board members approved an electrical aggregation program Wednesday following two public hearings.

Tilton is one of the 11 communities in Vermilion County that had a referendum for municipal aggregation. The hearings, which are required by state law, were for the purpose of informing and answering residents’ questions on how the referendum’s decision will be implemented.

Tilton, like many other communities, has chosen to work with Good Energy, LLC of Peoria to guide them through this complex process.

Good Energy is not an electricity supplier, but a consultant and broker. According to Jerod McMorris, an energy consultant with Good Energy, after Tilton and each of the other communities have conducted their two public hearings, each municipality will approve an ordinance that sets up a plan of operation and governance. Each municipality will also authorize the mayor to sign a contract with the electricity provider that offers the lowest rate per kilowatt hour and the length of contract that the village chooses.

Tilton and the other Vermilion County municipalities that conducted successful referendums will be placed in a pool of other Illinois communities for the purpose of seeking bids in providing electrical service.

McMorris said there will be about 105,000 households participating in this pool seeking a supplier for electrical service.

“When the General Assembly passed the law allowing municipal aggregation, it recognized the purchasing power of a group of customers,” McMorris said.

“Purchasing anything in a large number will generally yield a lower price,” he said. “For example, look at Sam’s Club and Walmart, where volume purchasing results in cost savings for the consumer.”

Good Energy has conducted two rounds of bidding for some 110 Illinois communities representing some 400,000 households.

McMorris said the last round of bidding, conducted last November, resulted in a bid of about 3.9 cents per kilowatt hour for its participating communities. That compares with Ameren’s current average kilowatt hour price of 5.75 cents.

The county has an agreement with Integrys Energy to supply electricity for county residents in unincorporated areas at a rate of 4.26 cents per kilowatt hour.

On May 15, representatives of Good Energy as well as the participating communities will gather and receive the bids from up to five electrical power suppliers. All of the communities participating will have to agree on one electricity supplier, however each community can decide on the length of term of its contract.

After a bid is agreed upon by all the municipalities, then each mayor will sign a contract.

McMorris said after the contracts are signed, the winning electricity provider will then send each household a letter, probably within 30 days, which will contain instructions on how to opt-out of the program. Opt-out means to not participate in the program. To be a part of the program, residents will do nothing. This is the first chance to opt-out.

Ameren will then send a follow up letter to verify the resident’s decision either to be in the program or opt-out. This will be the second chance to opt-out.

McMorris said the estimated savings for those households that participate in the program is somewhere between 20-25 percent of an electric bill.

According to McMorris, if residents miss or disregard both opportunities to opt-out of the program, they can still do so within the first three months. After that time, there will be a $25 termination fee.

Residents should start to see the reduced price for electricity in their July bills.

McMorris reminded residents they still will receive only one bill from Ameren as in the past.

Residents who have signed agreements with other electrical suppliers such as Integrys or Direct Energy must contact their respective supplier to see how to terminate those agreements if they wish to be a part of the program. Those households will not receive opt-out letters.

Also, participants in the Power Smart Pricing program will not receive opt-out letters.