What is Community Choice Electricity Aggregation?
Officially known as municipal aggregation, Community Choice Electricity Aggregation (CCE) is a program in Massachusetts that came out of the Restructuring Act of 1997, specifically Chapter 164: Section 134. Aggregation of electrical load by municipality or group of municipalities; adoption of energy plan. The Act empowers cities and towns to create large buying groups of residential and business electricity accounts in order to seek bids for cheaper supply rates, essentially bulk-purchasing. The purpose of the Act was to ensure that the benefits of energy deregulation were passed onto residential customers and businesses by providing the ability to aggregate their accounts within their municipal boundaries in order to obtain competitive bids from Third Party Suppliers (TPS). Grouping residential accounts together create economies of scale, enabling participating municipalities to achieve greater savings for account holders as a whole. You may find more information about the electric industry in the state by visiting the Department of Public Utilities (D.P.U.) website or the Department of Energy Resources website on municipal aggregation.
What are the objectives of community choice electricity aggregation?
The objectives of CCE are simply to provide longer-term price stability, lower electricity supply costs on your electricity bills, and to offer an electricity supply product that contains more renewable energy through the formation of a buying group composed of residents and businesses of one or more municipalities without interfering with the level of service provided by the utility, in this case, Eversource, delivering the electricity supply.
Where does the renewable energy for the program come from and how do I know I’m really getting 100% renewable energy?
For the City of Somerville and other communities in Greater Boston, Green Energy Consumers Alliance, Inc. (previously Massachusetts Energy Consumers Alliance) is supplying the local renewable energy above the amount required by state law known as the Renewable Portfolio Standard (RPS). Green Energy Consumers Alliance, a Boston-based nonprofit, purchases renewable energy wholesale mostly from community-based wind power projects located in Massachusetts and Rhode Island. Green Energy Consumers Alliance has entered into a number of long-term contracts with wind power projects located in communities such as Plymouth, Gloucester, Scituate, and Ipswich. Here’s a blog post from Green Energy Consumer’s Alliance which better explains renewable energy and renewable energy certificates (REC), the financial instrument by which renewable energy is commoditized.
Can I choose a different product option (e.g., switch from the Somerville Local Green option to the Somerville Premium 100% Local Green or Somerville Basic) after I have been enrolled?
Yes, you can change your program option selection at any time and without penalty and continue to participate in the program.
How do I select the Somerville 100% Local Green option?
For those who wish to select the Somerville 100% Local Green option, please contact the program supplier, Dynegy, directly at (866) 220-5696 Monday through Friday from 9:00 AM to 8:00 PM EST, or via email at DESCustCare@Dynegy.com. Please have your Eversource account information available when contacting. You may also opt up to the Somerville 100% Local Green option here.
Is Somerville Premium 100% Local Green tax deductible?
If you have selected Somerville Premium 100% Local Green, Green Energy Consumers Alliance is supplying 100% of your Class 1 Renewable Energy Certificates (REC). Green Energy Consumers Alliance explained to the Internal Revenue Service that the environmental benefits of renewable energy are enjoyed by everyone, which is why economists would call renewable energy a “public good”. With that logic, the voluntary purchaser of a REC from the Green Energy Consumers Alliance is able to deduct their REC purchase from their federal income taxes if they itemize charitable contributions on their return. As a result, you will receive a letter from Green Energy Consumers Alliance in January that details the amount spent on the 100% premium which you may deduct.
How does community choice electricity aggregation work?
First, the municipality passed a motion at City Council which then subsequently approved the creation of an aggregation plan in October 2015. Somerville then used Good Energy, L.P. to seek bids from third party suppliers (TPS) to obtain competitive electricity rates for participants. An account holder is then able to opt out from the program during an initial 30-day enrollment period by returning the opt-out letter sent to the account holder by the winning supplier on behalf of the city, or they may leave the program at any point with no associated termination penalties or fees.
What other Massachusetts municipalities participate in aggregation programs?
Somerville joined over 140 Massachusetts municipalities, including Arlington, Brookline, Cambridge, and Winchester to take advantage of the state law that allows this type of municipal aggregation. View a list of them here.
When did the community choice electricity aggregation go into effect?
The program originally launched in July 2017.
What do I need to do in order to participate?
If you are currently receiving your electricity supply from Eversource Basic Service, you do not need to do anything. You will automatically be enrolled in the program unless you choose to opt out.
What is an opt-out notification letter and why did I not receive one?
The opt-out notification letter provides details about the Somerville Community Choice Electricity Aggregation program. It is sent by Dynegy, the winning supplier for the program, on behalf of the City of Somerville. By sending the enclosed opt-out card back to Dynegy, you will be indicating that you do not wish to participate in the Somerville CCE program. If you have not received an opt-out letter, this may be because you are already in contract and receiving electricity supply from a third party supplier. If you are not in contract with a third party supplier and believe you should have received the letter, you may download and print the opt-out letter here (tba – currently being updated). You may also contact Dynegy by phone at (866) 220-5696, Monday through Friday from 9:00 AM to 8:00 PM EST, or via email at DESCustCare@Dynegy.com to learn more.
How does community choice electricity aggregation impact my electricity bill?
The goal of CCE is primarily savings and long-term price stability, though savings cannot be guaranteed, due to the fact that there is no visibility into future Eversource rates. Participants will see no change in their electric utility bill other than a change in price on energy supply. They will continue to receive a single bill, make one payment, and continue to receive the same level of service from Eversource.
What part of my electricity bill will this program affect?
Your electricity bill has two cost components – delivery and supply. The aggregation program only changes the supply component of your bill. The delivery portion of your bill will not be affected.
Will I be charged a higher delivery rate?
No, you will not be charged a higher delivery rate; delivery rates do not change based on participation in a CCE program. Delivery rates are set by the utility and are regulated by the Massachusetts Department of Public Utilities.
Will the single bill come from Eversource?
Yes, your single bill will continue to come from Eversource.
How will I be notified that my account(s) was successfully enrolled in the community choice electricity aggregation program?
Each eligible account holder should have received written notification after the bid informing them of the winning supplier price compared to Eversource’s rates, in addition to the account holder’s right to opt out. After the 30-day opt-out period has ended and the program has begun, each eligible account holder that did not opt out will see the following indicated on their Eversource bills:
Where do I find my account number on my Eversource bill?
Your account number is located on the top left of your Eversource bill.
When will I begin seeing a change in my electricity bill?
Enrollment took place in June 2017. Power flow began with your July 2017 meter read and was reflected on your following month’s bill.
Do I have to sign a contract?
No, there is no contract to sign. The program is designed to be as easy as possible for participants. Accounts are automatically enrolled as long as they are currently receiving supply from the utility. Regular updates will be posted on the municipality’s website.
How long is the Somerville Community Choice Electricity program’s supply contract term?
The contract term will be 30 months in duration, with the current contract ending in January 2020.
Is there any change to my meter? If so, how/who reads the meter?
No, there are no changes to your current meter. Eversource continues to read your meter.
Is a deposit required?
No, no deposit is required.
Do I have to participate in the community choice electricity aggregation program if I don’t want to?
No, residents and businesses can opt out without penalty during a 30-day opt-out period. Opt-out notices will be provided via USPS mail prior to the program commencing. Simply return the opt-out notice within 30 days and your account(s) will not be included. Participating account holders may leave the program at any time and without penalty. You may also opt out of the program here.
What if I choose to leave the program early?
Participating account holders may terminate their participation at any time without any early termination or exit fees. Similarly, residential and small business accounts may return to the program at any time with no associated re-enrollment fees.
If I opt out, can I opt back in at a later date?
Residents and small commercial accounts that are enrolled in the program may terminate their participation in the program at any time without any early termination or exit fees. They may also re-enroll in the program at a later date with no associated re-enrollment fees. The aggregation program rate will be reflected on the account holder’s utility bill on the next available billing cycle. Because switching suppliers requires at least two days to process by your utility, you are encouraged to re-enroll in the program at least five business days prior to the meter read date indicated on your utility bill in order to ensure re-enrollment occurs on a timely basis.
What is a Third Party Supplier?
A Third Party Supplier (TPS) is a for-profit company that sells electricity supply into the grid which may be purchased by individual electricity customers under contract.
I am currently receiving offers from third party suppliers promising lower electricity rates. What should I do?
TPS are currently very active within the Commonwealth. This is due to the significant increases in electricity rates for all utilities within Massachusetts. We strongly advise any account holder to read the complete contract fine print and have a clear understanding of any termination penalties, along with rate details, before agreeing to purchase electricity from a TPS.
Will other third party supply offers stop if I participate in the program?
No, unfortunately, you may continue to receive other TPS offers. It is important, therefore, to remember the details of the aggregation program, i.e., the duration of the program, rate, etc. Very often, due to the length of time commonly associated with these types of programs, participants forget the program is still in effect, when in fact there may be months or even years remaining. Sometimes this results in a participant inadvertently leaving the program for what they may believe to be a better offer. You are encouraged to remember that the CCE program is operated under the due diligence of your municipality and though not impossible, it is unlikely that other offers will be more competitive. Please regularly visit this site and your municipality’s site(s) for updates.
What happens if I move my residence or business from one location to another within the town and want to remain in the program?
If you move within the municipal boundaries of the city, you may preemptively contact Dynegy by phone Monday through Friday from 9:00 AM to 8:00 PM EST (866) 220-5696, or via email at DESCustCare@Dynegy.com to re-enroll your new account in the aggregation program at the original rate for the duration of the term. If you do not preemptively contact Dynegy, you will receive an opt-out notification letter which details the program. Simply disregard the opt-out notification letter if you wish to participate in the program. Please note that your first month of service will default to Eversource Basic Generation Service supply, but will then transition to the Somerville program on your next available billing cycle.
Under the program, can I continue to participate in Eversource’s budget billing/equal payment plan?
Yes, you can continue to participate in a budget billing/equal payment plan. No action is required to remain in the budget billing/equal payment plan.
Who do I call if there is an outage or issues with my electricity bill?
All service and billing questions will continue to be directed to Eversource a (800) 592-2000.
Will the utility take longer to restore my electricity if I am with a third party supplier?
No, the delivery of your electricity is always the responsibility of the utility. As a result of energy deregulation in 1997 in Massachusetts, utilities are only able to collect revenue from delivering the power to your meter, not from the actual supply. This is why utilities in Massachusetts are indifferent to the supply portion of the bill. Simply put, your utility does not make any money on the actual electricity they supply to your account(s). They only generate revenue from the delivery of that electricity.
Will the community choice electricity aggregation program include both electricity and natural gas?
No, the program will focus exclusively on electricity.
Can businesses participate in the program?
Yes, any account currently on basic service that is not enrolled with a TPS is eligible and will be automatically enrolled unless they choose to opt out.
I switched to a third party supplier and a few months later, my rate increased and I was paying much more than the utility rate. How do I know this won’t happen again by participating in this program?
The final contract required the winning supplier to maintain the new rate for the entire term. This is called a fixed rate.
How do I know the community choice electricity aggregation rate will always be below the utility rate?
No, there is no guarantee the program rate will always be below the utility Basic Service rate. The aggregation price usually reflects a fixed rate for the full term of the Electric Service Agreement, which may be several years in duration. The Basic Service rate changes every six months for residential and small business & lighting accounts, and every three months for large commercial/industrial customers.
How are we sure that a competent and reputable supplier will be selected?
Only TPS licensed by the state were eligible to bid. In addition, an in-depth request for proposal was disseminated by the energy consultant to interested TPS requiring them to provide their qualifications. Among other things, the request required suppliers to demonstrate financial strength, experience, and customer service capabilities.
Will my utility be eligible to bid?
No, by law, utilities are not permitted to bid. With regard to supply, the utility only provides default service, however, the utility will always be responsible for delivering your electricity.
What if I have a photovoltaic or solar panel system?
Having a solar system which allows you to earn net metering credits does not preclude you from participating in the aggregation program. As long as the account holder is receiving supply from Eversource, they are able to participate in the aggregation program and will continue to receive net metering credits from the utility. Net metering will work in the same way as before you joined the CCA program. Your net metering credits will continue to appear on your Eversource bill and will continue to be calculated based on Eversource’s Basic Service price. In addition, there is no change in SREC eligibility or the ability to sell the SRECs. For a more detailed explanation, please click here.
How do I contact the winning supplier?
Dynegy is the winning supplier for the program. They may be reached by phone Monday through Friday from at 9:00 AM to 8:00 PM EST (866) 220-5696, or via email at DESCustCare@Dynegy.com.
What administrative functions will the municipality be performing related to this program?
The energy consultant will be responsible for managing all aspects of the program and keeping the municipality appropriately informed. You can always call 311 to ask questions.
Does my municipality profit from the program?
No, your municipality does not profit from a CCE program.
How can I get more information about the community choice electricity aggregation program?
Please check for announcements from your municipality and local news outlets.
What if the selected supplier goes out of business or is bought?
Good Energy’s due diligence process required bidding suppliers to meet strict qualification requirements. Among other things, the request required suppliers to demonstrate financial strength and experience, as well as customer service capabilities. This process minimizes any chance of a supplier going out of business. If the supplier is bought, the purchasing entity will continue to provide supply service under the existing contract terms.
What happens at the end of the community choice electricity aggregation supply contract term?
Good Energy will work with your community to obtain renewal pricing. Similar to the original term, eligible customers will be given the opportunity to opt out.
Does Somerville pay any administrative fees?
No, the city does not pay any administrative fees.
What is the history of aggregation programs in the Commonwealth?
In 1997, the State of Massachusetts became the first state to pass municipal electric aggregation legislation, a type of program designed to save consumers money on their electricity bills. In fact, in 1997, the Commonwealth formed the Cape Light Compact, the first municipal electric aggregation program in the country. Six other states have since followed. The programs go by different names in different states, but the bulk-purchasing principles upon which they operate are largely the same. By aggregating, or grouping, a large number of electric accounts together, economies of scale are created, enabling participating municipalities to achieve greater savings for consumers than could normally have been achieved by the individual customer.
Who is Good Energy, L.P.?
Good Energy, L.P. is a leading national energy management and consulting firm that has been implementing large and small community choice aggregation programs in various states across the country since 2008. They have partnered with your municipality to design and operate this CCE program. Good Energy is headquartered in New York City and is currently the retained community electricity aggregation consultant for over 200 communities across the country. Somerville selected Good Energy to serve as its energy consultant through a competitive process, in partnership with neighboring cities and towns.