Voters in Metro East consider buying electricity in bulk, will it save money? - KMOV.com

Voters in Metro East consider buying electricity in bulk, will it save money?

(KMOV) -- On Tuesday, voters in at least a dozen Metro East communities will vote on whether to give their city the permission to buy electricity in bulk for residential and small commercial retail customers.

Here's what it means: the city could hire a broker to go out into the wholesale energy market and buy electricity in bulk. Metro East customers would still get a bill from Ameren Illinois. Ameren would still deliver the electricity through its power lines and respond if there's an outage. There would only be a change in the energy portion of the bill, which makes up the majority of a power bill.

"It's the buying power of the group, compared to the buying power of the individual," said Eric Robertson, the attorney hired by Granite City to work on the deal.

Granite City is one of about a dozen metro-east communities asking voters to approve the idea. Alton, Belleville, Bethalto, Collinsville, Columbia, Glen Carbon, Godfrey, New Baden, Shiloh, and unincorporated St. Clair County are considering this. In all, 300 Illinois communities will vote on similar measures on Tuesday. See the full list of communities here: http://www.icc.illinois.gov/ORMD/MunicipalAggregationEx.aspx

The Citizens Utility Board says that roughly 20 communities in northern Illinois have tried this and typical residential customers have saved $10 to $15 dollars a month.

If a community is given the go-ahead to buy electricity in bulk, customers would be given at least two chances to opt out. Two letters will be sent to consumers. The second is sent out after Ameren sends its first consolidated bill, which includes charges from the new energy supplier. So, if your city negotiates a community deal, you can decide to stick with what you already have.

If a consumer ignores the letters, they are automatically enrolled and opting out later may involve a fee.

However, consumers should not consider this a way to avoid any potential Ameren rate increases. The hikes apply to the delivery side of the bill and Ameren would still deliver the electricity, according to the CUB.

"No matter who your electricity supplier is you're always going to get your electricity delivered at the same price by Ameren," said David Kolata, CUB's Executive Director.

There's some behind-the-scenes information you should understand, too. Ameren Illinois (and ComED) have been locked into long-term energy supply contracts that are currently above the market rate. Those contracts expire next summer, so there's a chance electricity bills could go down then. Still, there's no guarantee.

Kolata says consumers should watch the deals their communities negotiate and consider whether a very long term deal is a good idea.

You can find more information here from the Citizen's Utility Board here: http://www.citizensutilityboard.org/cubsGuideToMunicipalElectricityAggreation.html

Another website, promoting municipal electrical aggregation here:  http://munienergychoice.com/

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