BOSTON – January 18, 2017 – With consistently low temperatures across New England causing electricity usage to spike over the past two weeks, Massachusetts households and businesses served by the state’s largest utilities, Eversource and National Grid, are preparing for February bills reflecting winter electricity supply prices that are close to all-time highs.
As utility basic service electric customers brace for those February bills, there has been a notable shift in the state’s retail electricity market. Community electricity aggregation is transforming the competitive landscape by providing an alternative to volatile electric supply rates while also expanding customer options for purchasing local renewable energy.
The recent rapid expansion of aggregation in the Commonwealth has been driven in large part by Good Energy, LP, a national energy consulting firm that observed the state’s historically high electric rates in the winter of 2013/14 and proceeded to enter the market with an innovative campaign to educate municipalities about the value of community electricity aggregation based on its vast experience in other states.
In less than four years, the percentage of Massachusetts consumers switching from their conventional utility to a “competitive supplier” of electricity has grown from about 15 percent to nearly 45 percent, with a primary driver being the utilization of aggregation programs. During that time, Good Energy has developed community electricity aggregation programs in 32 cities and towns, with eight more awaiting state approval or in development, currently serving communities with over 300,000 households across Massachusetts.
Measured against significantly higher “winter” rates recently approved for Eversource and National Grid, Good Energy aggregations across Massachusetts are on track to produce significant savings for consumers and small businesses during this winter season. While municipal aggregators’ fixed price supply contracts cannot guarantee savings compared to the utility basic service rates that change every three to six months, Good Energy has been successful in securing supply contracts for its client communities that have produced savings over the full term of the agreements. From January 2016, when Good Energy’s first Massachusetts contracts went live, to early summer 2018, cumulative savings are projected to total over $23 million (compared to rates in effect for National Grid and Eversource customers during the same period).
Among Good Energy’s municipal partners is a diverse buying group of 23 Massachusetts cities and towns stretching from the South Coast to northern Middlesex County. As the second largest electricity buying program of its kind in the US, with over 200,000 households, this group saved approximately $8 million through its initial two-year supply contracts brokered by Good Energy, and began a new three-year aggregation contract in January that will enable electricity savings this winter as well.
Encompassing nearly two dozen communities, including Acushnet, Attleboro, Carver, Dartmouth, Dedham, Dighton, Douglas, Dracut, Fairhaven, Fall River, Freetown, Marion, Mattapoisett, New Bedford, Northbridge, Norton, Plainville, Rehoboth, Seekonk, Somerset, Swansea, Westford, and Westport, the program was singled out by the International City/County Management Association last October with a 2017 Local Government Excellence Award.
In an environment of continuing rate volatility, these aggregation programs have successfully provided safe harbor for ratepayers with one fixed rate, while maintaining the freedom for individual customers to leave the program at any time without penalty.
In addition, Good Energy’s pioneering method for allowing communities to choose more renewable energy than state law requires – directly supporting development of new regionally-based renewable energy resources – advances the Commonwealth’s ambitious clean energy goals while holding the line on costs. Even customers that opt for 100 percent renewable energy through participating Good Energy aggregations (Arlington, Brookline, Somerville, Sudbury and Winchester) will pay rates comparable to Eversource’s basic rate of 13.1 cents per kilowatt hour this winter.
“Good Energy is passionate about innovating in creative ways as we seek to help communities meet their climate conscious energy goals,” said Philip Carr, Good Energy’s New England Regional Director.
Beginning in 2015, Good Energy worked with the Mass Energy Consumers Alliance to pioneer an award-winning approach to provide consumers with a “default” option of purchasing five percent additional local renewable energy above and beyond the percentage required by the Massachusetts Renewable Portfolio Standard (13 percent for 2018). Good Energy currently has six community electricity aggregations that include this default product of at least five percent above the RPS, with five more communities in development.
“Communities can bring more renewable energy onto the grid by harnessing the purchasing power of their residents and businesses,” Mass Energy’s executive director, Larry Chretien, said. “Many cities and towns have sustainable energy programs and we’re pleased to see that an increasing number of them are adopting this approach.”
Of particular note is the Town of Brookline, which has one of the most progressive programs in the country with a default product that includes 25 percent MA Class I (local) renewable energy above the RPS requirement. Consumers interested in making a bigger commitment to clean energy can opt for 100 percent renewable energy under the electric supply contract brokered by Good Energy.
“Good Energy’s experience, not only with aggregation programs nationwide, but in designing the pioneering ‘aggregation-plus-renewables’ mechanism, was key in the successful launch of our program, Brookline Green Electricity, with its ambitious plus-25 percent default product,” said Brookline Senior Planner for Climate Action/Land Use Maria Morelli. “They expertly prepared us about the complex energy markets so that we could design the best program to meet our community’s needs.”
About Good Energy: Good Energy is the national leader in the design, implementation and management of community electricity aggregation programs and has been a pioneer in helping municipalities across the country provide a responsible alternative to utility rates with state of the art renewable energy strategies.