Lower Township Hopes to Lower Electric Bills

VILLAS – Lower Township Council approved a contract Aug. 5 with Commercial Utility Consultants (CUC), an energy aggregation firm in order to save residents money on their electric bills.
The township is joining with neighboring towns to create the Lower Township Aggregation Program which permits the aggregation of all residential customers in the township for the purpose of purchasing electricity at rates lower than currently available from Atlantic City Electric.
John Fish, CUC business development director, said the company’s clients included the cities of Philadelphia and Pittsburgh.
In 1999 the state deregulated the power industry separating delivery of power from producing electricity. Fewer than 16 percent of state residents have chosen a third party power supplier to save on their electric bills, said Fish.
He said Atlantic City Electric does not generate their own power, so customers are already using a third party provider through a statewide auction called “Basic Generation Services.”
“What we’re looking to do through Title 14 is to just have a chance to beat the rate that the state is telling us we have to take,” said Fish. “The municipality has the right to compete against the state auction.”
According to the agreement, CUC will not accept a bid unless it is at a rate that is equal to or lower than the utility currently charges for energy. The township will not pay any fees to CUC and will look solely for compensation from the supplier.
The term of the agreement is two years and thereafter on a year to year basis. Residents will be automatically enrolled in the energy program if they are not already using a third party supplier but may contact CUC if they wish to opt out.
Fish said residents have 30 days to decline to be part of the program.
Residents will receive three letters explaining the program and a card that can be mailed back to opt out of the program. Fish said a website and a toll free phone number would be established for residents to decline the program.
Residents can leave the program at any time, said Fish.
Suppliers would bid against each to provide a competitive rate. He said township officials would decide if the rate is far enough below Atlantic Electric’s rate to produce enough savings to warrant the program.
The aggregation program is only for the supply portion of electric and gas service. The delivery portion will continue to be provided by Atlantic City Electric at regulated rates and the company would continue to provide all emergency and safety services.
Atlantic City Electric would also continue to provide customer services such as meter reading, billing and service restoration. The only change residents would see on their Atlantic City Electric bill is a fixed rate and the name of the power supplier instead of “basic generation services.”
Fish said residents could continue to use Atlantic City Electric’s equal payment budget plan or assistance programs.
If Atlantic City Electric’s default rate drops, so will the township’s rate, he said. Fish said the program would put several hundred thousand dollars per year back into the pockets of residents.
The program will also be opened to commercial power customers after the residential program is underway.