By Kate Hill
Staff Writer
The Town of Nelson is one of 21 municipalities in the region to partner with the Municipal Electric and Gas Alliance (MEGA) to provide competitive, fixed-price electricity to its residents and small businesses through a Community Choice Aggregation (CCA) program.
MEGA is a not-for-profit local development corporation that helps New York municipalities, school districts and businesses to save on electricity and natural gas through a group-purchasing strategy.
MEGA’s new CCA program allows local governments to pool the electricity accounts of residents and small businesses within their boundaries and seek proposals from alternate electricity suppliers. By aggregating purchasing power, communities gain leverage to negotiate with competitive suppliers for more favorable contracts.
Eligible CCA participants can save money on their electric bills; avoid unfavorable supply deals and sudden spikes in the price of electricity; minimize door-to-door solicitors and telemarketers; and gain access to renewable energy sources.
Starting in July, the CCA will offer the Town of Nelson residents and small businesses 100 percent renewable electricity at a fixed price of $0.05435 per kilowatt hour for 36 months.
The CCA prices and terms were negotiated with Constellation, one of the nation’s largest retail energy suppliers.
On May 1, the Town of Nelson held a public education session with CCA Project Leader Louise Gava, who described how the program works and what the community can expect.
Gava said in order to be automatically included in the program, a customer must live within the Town of Nelson, receive their electricity supply from National Grid, be a resident or small business (>2000kWh per month) and not have a block on their account.
MEGA’s CCA program is compatible with budget billing, community solar and rooftop solar.
Participation in a CCA is always voluntary. Options to “opt-out,” “opt-down” or “opt-in” are essential parts of the program, according to Gava.
“CCA is all about choice,” she said.
Those who are automatically eligible to participate will receive a written notice in mid-May.
Upon receipt of the letter, those who do not wish to participate will have 30 days to opt-out via mail, phone or online. Participants will also be permitted to leave the program at any time during the 36-month term without penalty.
“This has no fees,’’ Gava said.” It’s not meant to be a trick; it’s meant to bring value. You can go back to the utility at any time if you don’t like it.”
Larger businesses and customers signed on with a supplier other than National Grid can opt-in at any time. The electricity rate will remain fixed regardless of when a customer joins the CCA.
Participants will also be able to opt-down from 100 percent renewables if they prefer to purchase the traditional electricity (grid mix) at the fixed price of $0.05052 per kWh for 36 months.
According to Gava, the community’s participation in the CCA program required the completion of a number of steps.
After deciding to explore MEGA’s CCA, the town board held a public hearing and passed a local law authorizing the program.
“For the 21 municipalities that went through all of those steps and wanted to participate, we went out to the market and we said, ‘Okay, we have 40,000 households, how low can you go?’” Gava said. “’What are the terms you can provide? What is the value you have to offer?’”
Third party electric services companies (ESCOs) competed to win the business of the CCA by responding to a Request for Proposal (RFP).
After considering a number of factors, including price, contract terms, customer service and long-term financial viability, MEGA determined the winning bid.
MEGA returned to the board with a recommendation for price, term and supplier.
Based on the suggestions, the town awarded the supply contract to Constellation, a subsidiary of Exelon.
According to Gava, the company was involved in New York State’s pilot CCA program in Westchester — which is now on its second round. Outside of the state, Constellation has serviced CCA programs for 10 years.
Once the CCA program begins, National Grid will continue to handle the billing, deliver electricity, maintain the infrastructure and respond to service outages. Participants will continue to pay delivery charges to the utility.
Gava noted that while the “delivery” portion of each customer’s electric bill will look the same, the “supply” portion with reflect the change in the source and price of electricity.
For more information, email Gava at [email protected], call the CCA Helpline at 518-533-5399 or visit megacca.org.
