IMPORTANT QUESTION ON MARCH 20 BALLOT: REFERENDUM ON ELECTRICITY AGGREGATION PROGRAM

In the upcoming election on March 20, 2012, through a vote on a referendum, voters will choose whether the City may have the opportunity to obtain lower electricity rates for its residents and small businesses.

Last September, the City agreed to join a group of neighboring municipalities that will work together to secure electricity rates that are lower than current ComEd rates. By joining this North Shore Electricity Aggregation Consortium (“Consortium”), if permitted by the voters, we hope to negotiate cheaper rates due to the large volume of customers purchasing electricity together.

Right now, residents can individually contract for electricity from a provider other than ComEd. (We’ve all received offers in the mail.) What we are seeking under the referendum is the chance to join our neighboring communities to negotiate even cheaper rates for the entire city.

If approved on the ballot, and if the City and the Consortium identify an alternative supplier that can offer better rates, the electricity will continue to run through ComEd equipment, but the actual energy running through that equipment will be bought more cheaply from another source.  

The City will be holding two public hearings at upcoming City Council meetings to discuss the aggregation program: Monday, February 13, 2012, 7:30 p.m. at City Hall and Monday, February 27, 2012 7:30 p.m. at City Hall.

If the referendum passes, residents will still have the choice to opt out of this joint purchasing program and use either ComEd’s electricity or electricity from another provider than that chosen by the City.

Here is a more detailed summary provided by our City staff:

SUMMARY AND BACKGROUND

In 2009, the Illinois Power Agency Act was amended to allow municipalities to contract for the provision of electricity to residents and small businesses by alternative electric suppliers (instead of ComEd). Under the new law, the City may seek bids for aggregated electricity supply services for these customers. The goal is to get a lower rate than the standard rate offered by ComEd.

If the electricity aggregation program is approved and adopted, all residential and small commercial retail customers will be switched automatically to the City’s chosen supplier, unless a customer chooses to opt out of the program and to continue service through ComEd or through another provider.

VOTE ON THE REFERENDUM

As the first step in the new program, the City must pose a referendum question on the March 20, 2012 ballot asking voters if they wish to allow the City to pursue this alternative source of electricity. The question will read:

“Shall the City of Highland Park have the authority to arrange for the supply of electricity for its residential and small commercial retail customers who have not opted out of such program?”

COLLABORATION

Our City staff has been working with nearby communities that are also considering the “opt-out” electricity aggregation program: Deerfield, Glencoe, Lake Bluff, Lake Forest, Northbrook, Park Ridge and Skokie.  Collectively, this group is the Consortium.

The Consortium has an intergovernmental agreement which spells out the details concerning governance, implementation of the aggregation process, pricing options, and the bidding and supplier selection process.

The City will work with Consortium members to research and investigate the electricity market prior to issuing a joint supply power bid.

 IF APPROVED

If the “opt-out” referendum is approved by the voters on March 20, 2012, the City may consider implementing the opt-out program.  Full details will be provided to residents.

The bids will be compared to ComEd’s current rates, and the City will only consider approval of bids that will result in lower electricity prices than the current ComEd rates. Approval of the referendum does not obligate the City to implement an opt-out electricity aggregation program.

If a program is implemented, all residential and small commercial retail customer accounts will automatically be moved to the new supplier unless the customer opts-out; information will be provided in advance of the change to customers about how they can choose to opt out and remain with ComEd or a different supplier.

Remember, under this electricity aggregation program, ComEd will remain the distributor of electricity in the City; the selected alternative supplier will merely generate the electricity provided and deliver it to ComEd for distribution.   Customers will continue to receive electricity bills from ComEd and ComEd will remain responsible for all distribution system issues, including power outages.

Questions? Contact Emily Palm at epalm@cityhpil.com.

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