Town May Join Others for Lower Electricity Rates

Like those of surrounding towns, Rochester residents may soon start paying less for electricity; however, Town Meeting voters must first approve joining the Southeastern Regional Planning & Economic Development District (SRPEDD) Community Electricity Aggregation, the largest in Massachusetts and the second-largest in the country.

            What is a community electricity aggregation (CEA)? As explained by John O’Rourke from Good Energy, a municipal consulting firm, a CEA is the formation of a consumer buying group (various towns and cities) that benefits from the ability to negotiate lower electricity prices with more favorable terms.

            “It’s simply a bulk-buying situation,” said O’Rourke, likening it to a Costco membership of sorts where buying in bulk lowers the price.

            On behalf of the SRPEDD CEA, Good Energy “does all the heavy lifting and grunt work,” said O’Rourke on March 18 during a presentation for the Rochester Board of Selectmen. Good Energy helps design the town’s CEA plan, conducts the public outreach and education of residents of participating municipalities, procures the bids for the CEA to select, and also provides the town with an appropriate town meeting article for the warrant.

            “We do all the heavy lifting,” O’Rourke told the selectmen, and after Town Meeting Approval on May 20, he said Rochester could be in the CEA by the end of this year.

            As of today, Rochester is the only town out of the 20 in the SRPEDD region that is not a part of the CEA because, when approached by Good Energy back in 2015, that sitting Board of Selectmen declined to consider the option. Meanwhile, the participating residents of the other 19 other cities and towns have been paying lower rates such as $0.1043 per kilowatt hour, while Rochester residents still pay the Eversource basic service rate of $0.1307 per kWh.

            Cumulatively, between 2016-2019, the 434,641 CEA households have saved $41 million – that degree of continued savings, though, O’Rourke said, “We have to say that those savings are not guaranteed.”

            This is how the CEA works. Once adopted by Town Meeting, all residents are automatically entered into the CEA and would notice no difference in their electric service, aside from the savings, and residents currently receiving a lower rate under a discount program would see no impact on that lower rate. Residents would still receive one bill from Eversource. The only information that would be different on the bill would be the name of the electricity provider. According to O’Rourke, Eversource “couldn’t care less where the electricity comes from,” while remaining the distributor, still in charge of metering, billing, and maintenance of the power lines. Legislation in the late 1990s opened up the electricity market to competition and forced utility companies like Eversource and National Grid to divest, only allowing them to provide the electricity transmission, delivery, and maintenance, O’Rourke explained.

            The CEA is fundamentally an “opt-out” program, meaning residents who do not wish to participate are allowed to withdraw within the 30-day opt-out period via a card provided in the mail, and after the 30 days, residents can still opt-out – without any penalties – simply by calling Eversource to inform them.

            “If you want to leave, leave anytime you want,” said O’Rourke, “but we have more people who try to get in than try to get out.” Those who start out skeptical, he said, might opt-out, but later, when they find out they are paying more for electricity after talking to neighbors, they usually want back in – which is also possible at any time, said O’Rourke.

            But, why ‘opt-out’ instead of ‘opt-in’? The short answer, said O’Rourke, “is because the law is written as an opt-out plan.” The longer answer, he continued, is from a business point of view. Fewer consumers would be inclined to opt-in as opposed to opting-out – and the bigger the aggregate, the higher likelihood of favorable rates.

            Another benefit to being a part of the SRPEDD CEA: “It protects residents from some of these unscrupulous marketers that are around that will try to phone you, mail you things, knock on your door,” O’Rourke said. [Their deal] looks good in the beginning, and then it can get crazy in terms of price.”

            A small town like Rochester would benefit from being part of a large aggregate such as the SRPEDD CEA, O’Rourke said.

            “We put a specific bid out for Rochester and make it co-terminus with the SRPEDD aggregate,” said O’Rourke.

            The winning bid for a cheaper electricity rate is selected and municipalities can lock in that rate for periods of two to three years.

            Furthermore, there are no out-of-pocket costs to the town for joining.

            For Board of Selectmen Chairman Greenwood “Woody” Hartley, the board should take any action it can on behalf of the residents “that will help them lower their cost of living in our town.”

            Town Administrator Suzanne Szyndlar said she has spoken with several of the SRPEDD CEA towns and supports Rochester joining the CEA.

            “There [are] no complaints,” said Szyndlar. “They are very happy with the program. … They hear nothing (negative) from the townspeople – they seem to be very happy with it.”

            Town Counsel Blair Bailey said he is familiar with the SPREDD CEA and finds no issue in Rochester joining.

            The board voted to allow the article to be added to the May 20 Annual Town Meeting warrant.

            Also during the meeting, the board approved a PILOT (payment in lieu of taxes) agreement with Clean Energy Collective, developer of a solar farm at 268 Mattapoisett Road. The fixed 20-year agreement is for an initial payment of $17,500 with an annual 2.5-percent escalation, an agreement that Hartley said was ultimately $47,000 higher than the previous offer.

            “I think that’s pretty fair,” said Selectman Paul Ciaburri. “It’s fair for everybody.”

            In other matters, the board was pleased to learn that the Town’s health insurance rates for this fiscal year would only increase 1.5 percent, and also appointed Diana Knapp to the position of assistant treasurer.

            The board voted to not exercise its Right of First Refusal for 2.2 acres of Chapter 61A property currently for sale on Dexter Lane.

            The selectmen also broached the topic of changing the position of town clerk from an elected position to an appointed one and will discuss it at length during its next meeting.

            The next meeting of the Rochester Board of Selectmen is scheduled for April 1 at 6:00 pm at the Rochester Town Hall.

Rochester Board of Selectmen

By Jean Perry

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