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Hinsdale Explores Benefits of Electricity Aggregation

A referendum would have to pass on the March ballot for the village to negotiate directly with suppliers; ComEd would still be in charge of billing and infrastructure.

Power-outage season in Hinsdale may be over, but ComEd is still a hot topic at Memorial Hall.

The village’s residential ComEd customers could save 25 to 30 percent on their electric bills, village manager Dave Cook said, if they vote on and pass a referendum currently being considered by village trustees that would allow the village to aggregate its electricity accounts and negotiate a contract with an alternate electricity supplier.

The Board of Trustees is aiming for a December vote on the referendum after discussing it at two recent meetings. If passed, it would appear on the March primary ballot.

Trustee Laura LaPlaca said it’s important to move quickly because the current ComEd supply rates expire in 2013. They were first set with the state seven years ago, when the economy was in a better place, and it is believed that future rates will be lower. 

“In a year and a half, ComEd will no longer bound by those rates,” LaPlaca said. “They’ll be out competing in the market, as well.”  

Village manager David Cook introduced to the board the idea of municipal electricity aggregation at its Oct. 24 meeting. While ComEd would still distribute electricity with its infrastructure and be responsible for repairs and billing, the village would take bids for the electricity itself directly from energy suppliers certified by the Illinois Commerce Commission (ICC).

Oak Brook earlier this fall approved a two-year contract with an alternate supplier and secured a rate of 5.52 cents per kilowatt-hour (kWh), more than two cents less than the current ComEd rate of more than 7.7 cents per kWh.

Cook said one Hinsdale resident submitted a recent ComEd bill to the village and the village manager showed how that bill would change if the same rate Oak Brook approved were secured in Hinsdale.

The delivery services would all remain the same, as would the taxes attached to the energy. The electricity supply services, listed at the top of the bill, would be where the changes exist.

A household that uses 5,325 kWh in one month would pay $293.94 for its electricity supply charge with the Oak Brook rate, down from $379.99 with the current ComEd rate. The transmission service charge that totaled $40.74 on the resident’s recent bill, as well as the purchased electricity adjustment charge that totaled $18.21, would not be charged with an alternate supplier.

All-in-all, the resident's bill would have gone down from $623.13 to $478.13, according to Cook's calculations.

Cook said most contracts with alternative suppliers have clauses that consider the possibility that ComEd’s rate might come down to a more market-friendly level in the future.

“If the ComEd rate goes lower than what you bid, either you opt out of the contract or the alternative supplier agrees to match the ComEd rate,” Cook said.

Village President Tom Cauley made clear that aggregation does not relate to establishing a municipal electricity, which residents voted down in a 2007 referendum.

Executive director David Hoover of the Northern Illinois Municipal Electric Collaborative (NIMEC), an organization that helps municipalities educate residents prior to the referendum and negotiate with suppliers after the referendum, visited Memorial Hall Nov. 15 to introduce NIMEC and confirm the above details of aggregation.

Charles Schultz November 28, 2011 at 06:57 PM
Use Community Choice Aggregation to reinvest energy dollars in the community; customer owned local green electricity instead of wholesale power. Local green power, local jobs, carbon reduction. Learn more: localpower.com
Mike Sandrolini November 29, 2011 at 02:03 AM
What do you think about the possibility of a referendum currently being considered by village trustees that would allow the village to aggregate its electricity accounts and negotiate a contract with an alternate electricity supplier? Do you think it's a good idea that would save residents money?

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