Village of Saugerties trustees agreed to consider proposals for Community Choice Aggregation (CCA), a method of delivering energy through a consortium of municipalities that fixes the price, protecting consumers from fluctuations in the price of electricity and possibly giving them a lower price.
Joule Energy, which organized a previous contract for electricity, has tightened its requirements for suppliers and is dealing only with the larger providers that have shown they can weather changes in the market, Glenn Weinberg, a Joule vice president, explained at the Village Board meeting on Monday, March 28. In a previous contract, a provider called Columbia Utilities dropped its three-year contract with ten municipalities after one year, leaving residents to return to the system overseen by Central Hudson.
If the village decides to join the consortium, any rates worked out with Joule and the selected provider would apply only to village customers; the town is also considering joining the program separately from the village. The Town of Saugerties was a member of the group that had contracted with Joule in 2022, but the village had not been part of that group.
In addition to a stable and possibly lower price, the program allows municipalities a way to access electricity produced from renewable sources, Weinberg said. Finally, working through the consortium can provide a “protective ring” around the community, in the sense that “It brings communities together — in this case, 13 municipalities which go into the market together with a contract that they, not the supplier, approve. Because the buyer — the group of municipalities — is so large, it can demand competitive pricing.”
The program is based on an opt-out model, meaning that all the customers in a group are in the program, unless they choose to opt out. Joule provides several easy ways for customers who wish to drop out to do so. A postcard expressing the desire to opt out is provided with the introductory explanation of the program; the customer need only drop it in the mail. A telephone hotline is provided, and a website offers a form customers can fill out to opt out of the program.
Weinberg reviewed the old contract, which he said saved customers more than $7 million in the year that it was active. While there is no guarantee that that performance will be repeated, this is the historical performance.
Joule sent out a request for proposals (RFP) to be returned by the close of business on Tuesday, March 21 — the day after the meeting. “We’re expecting three bids from three very established…the companies are the very established blue-chippers,” Weinberg said. Once the bids come in, Joule will analyze them, and if they don’t offer real savings and a good deal for the municipalities in their terms, “We will recommend to them that they not act.”
The next step would be for the village to sign a Memorandum of Understanding (MOU), which would formalize the village’s interest, but would not be binding until the village actually accepted a bid; it could still opt out if it were not satisfied with the bid. The village may also have the option of choosing 100 percent renewable energy sources, 50 percent from renewable sources or no specified amount from renewable sources; the greater the level of renewables the higher the likely price, he said. “We will see tomorrow what that price difference will be; it will probably be about a penny,” Weinberg said. When you figure in how many kilowatt hours of electricity are used, the amount “is significant.”
Trustee Terry Parisian questioned whether the anticipated economies of scale would apply if different municipalities selected different plans — if one municipality wanted 100 percent renewable and another wanted no renewable, for example. Weinberg responded that, given the large number of guaranteed customers, companies would accept the differences.
There could be a problem if some municipalities selected one supplier and another selected a different supplier. Joule would make a recommendation as to the favorable supplier, but municipalities could choose not to follow the recommendation. “It is always strongest when there is consensus,” Weinberg agreed, noting that in the last three agreements to go into effect, there was consensus among the municipalities involved.
Parisian pointed out that an individual could join Ulster County’s CCA as an individual, and wanted to know whether a resident of one of the municipalities involved with Joule could decide not to join. Weinberg said that the municipality would have to join; individual citizens could not.
On Wednesday, March 22, the communities met via Zoom to receive the initial prices offered by the providers, Murphy said on Friday, March 24. The municipalities now have a two-week window to decide on a carrier. Murphy said that he wants to discuss the offers with Town of Saugerties supervisor Fred Costello before a decision is made. “We should be using the same carrier,” he said.
Murphy said that he is still not happy with the opt-out choice; he would have preferred that interested customers opt into the program. While the program offers a number of ways for customers to opt out, Murphy said that he would help residents who want to opt out with the necessary paperwork.