Grayslake joins bulk electrical purchase pool

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ComEd crew lineman Brook Bott works high on a electric pole to restore power in Hillside on July 13, 2011. l Keith Hale~Sun-Times

Updated: November 12, 2011 12:40AM

GRAYSLAKE — The village has decided to join Lincolnwood and Oak Brook in a regional electrical aggregation pool that will purchase electricity in bulk for its respective communities at reduced rates from what ComEd charges.

The Village Board adopted the action in response to a referendum approved by 80 percent of the voters in the April election. Power supplier bids will be sought this fall and the plan will get under way early next year.

“Dependent upon price, one can continue to purchase electricity from ComEd, or try the new village aggregation program if that is cheaper,” according to Mayor Rhett Taylor. “The program is completely voluntary.”

ComEd will continue to offer power for sale power for those who want it. They are mandated to sell it at cost. They will also continue to distribute it through their electrical grid system, including electricity from other alternate power suppliers as well. However, utility charges will continue to be on one ComEd bill.

Electrical aggregation, or the bulk purchase of electricity, is growing in popularity throughout the country. The Illinois Citizens Utility Board indicates that five states already have such programs and there are others in various stages of considering the proposal.

But the key question is will it lower one’s utility bill? CUB says, “It remains to be seen whether community aggregation will lead to real savings for consumers.” Another question is will it be dependable?

Both Rhode Island and Ohio estimate that community electrical aggregation has saved their consumers more than $18 million per year.

Downstate Fulton, a small farming community on the Mississippi River, was the first community in the state to experiment with electrical aggregation. They say residents’ rates there have been cut by 21 percent from those being charged by ComEd.

“Purchasing electricity in bulk will save our respective residents money, yet each municipality will have independent control over their community’s needs,” Taylor said, adding the intergovernmental bulk agreement with Lincolnwood and Oak Brook will attract more interest collectively from private power companies when Grayslake seeks bids this fall than would be possible by each community individually.

Grayslake would be the coordinator for all three municipalities when bids are let. He stressed the program is open to both residential and commercial customers located within the village limits.

Although the three municipalities would be bidding jointly, each village would contract for its power agreement with the low bidder and operate its own aggregation program under guidelines drafted by each village.

Village Manager Mike Ellis has been authorized to accept the low bid for the electricity to be supplied, provided the price is lower than the current ComEd rate at the time.

Prices on the open electricity market are very volatile with wide swings in pricing at times.

Ellis said the supplier typically guarantees best pricing for only a 24-hour period, so it is essential that purchasers approve a low bid quickly. After the bid is accepted, then the Village Board must ratify the power supply agreement with the selected supplier for the appropriate term.

The village plans an upcoming mailing explaining the program in further detail and instructions for residents to sign up for the program, Ellis said.