Oswego residents to save on electricity : News : Oswego Ledger-Sentinel : Hometown Newspaper for Oswego and Montgomery, Illinois
|Oswego residents to save on electricity|
|Reduced kilowatt per hour rate secured through competitive bidding|
|by John Etheredge|
Oswego residents should expect to see a savings on their electric bills just in time for the summer season.
The village entered into a two-year contract May 2 with First Energy Solutions, Inc., to supply electric power to village residents and small commercial businesses.
First Energy was one of six firms to submit bids for the contract to provide electric power to the village under an electric aggregation program approved by village voters in a March 20 referendum.
Passage of the referendum allowed the village to seek competitive bids for the electric power portion of the monthly electric bills sent by ComEd to local residents and small businesses.
Mark Horton, the village's finance director, said beginning in July First Energy will provide electric power to the village at a rate of 4.75 cents per kilowatt hour, 2.98 cents less than the 7.73 cent per kilowatt hour rate residents are currently paying to ComEd.
First Energy's 4.75 cent rate will remain in place for the two year life of the contract.
A typical village resident should see a savings of about $270 annually or $22.50 per month on their electric bill under the reduced rate, according to figures provided by Horton.
Horton said ComEd is expected to announce new, lower rates "in a couple of weeks" and noted the expected savings residents will see from First Energy are based on ComEd's current 7.73 cent rate.
Horton noted the village's contract with First Energy includes a rate guarantee that would require the firm to reduce its rate to ComEd's rate in the event ComEd were to reduce its current 7.73 cent rate to less than First Energy's 4.75 cent rate.
"Not all of the bids that we received had that rate guarantee and we wanted to make sure we had that in our contract," he said.
The Northern Illinois Municipal Electric Cooperative (NIMEC) oversaw the contract bidding process on the village's behalf.
The village board voted 5-0 May 1 to authorize Horton to enter into a contract of up to three years on behalf of the village, pending the outcome of the bidding process.
The board also stipulated the company the village contracted with was "green," meaning that the electricity it generates is from 100 percent renewable resources.
Horton said the bidding was competitive among the six firms.
"We got some good rates and with (Energy Solutions), we're right in a good ballpark when you compare us with the rates that other communities have gotten," he said.
Horton said electric power bids have varied among municipalities due to electricity usage and load requirements.
watch for letter
Horton said village residents should expect to receive a letter from the village in the next two to three weeks informing them Energy Solutions has been awarded the contract at the 4.75 cent rate and informing them of their right to opt out of the lower rate and continue to receive their electric power from ComEd.
"If they don't want to participate in the program and want to stay with ComEd, they'll be asked to sign the letter and send it back," he said.
Horton also noted residents who begin receiving their electric power from Energy Solutions who later choose to contract with another electric supplier while the village's two year contract is still in effect will face a $25 early termination fee.
Regardless of what residents decide to do, they will continue to receive their monthly electric bills from ComEd and the utility will continue to maintain local electric transmission lines and other electric service infrastructure. The only difference residents will notice will be a line on their ComEd bills indicating that Energy Solutions is providing their electric service.
Horton said the electric power rate will be applied to meter readings taken beginning in July, when the contract with Energy Solutions becomes effective.
When residents should look for a reduction on their electric bills after July 1 will depend upon when their meters are read, according to Horton.
"It will depend upon what your (meter) read date is," he said.
Horton noted the rate for small business has not yet been set, but it should be less than the 4.75 cent residential rate.
"They'll get a bit more of a break because they use more electricity than residential customers," he said.
Small business owners who wish to terminate their service from Energy Solutions and contract with another service over the next two years will be charged a $50 fee, Horton said.