Southborough Community Power Choice – look twice before you opt out of savings plan (But, medium & large businesses should probably opt out)

I need to follow up on my earlier posts about the Town’s Municipal Aggregation Plan, marketed as Southborough Community Power Choice.

Partly, I wanted to clear up how I got confused about the Town’s primary intent – which is to provide savings to residents and businesses.

But making sure readers get the correct information is more important than sharing how I got that part wrong. After all, your decision to rollover or opt out effects your wallet.

I’d hate for someone to miss out on savings because of a misunderstanding I created. So, that’s the part I’ll focus on first.

In Tuesday’s sessions info sessions, the Town’s consultant Marlana Patton explained the program benefits.

As I previously shared, the new general plan rate is 10.880¢/kWh. That’s 1.793 cents lower than the basic plan rate that National Grid will be offering through April (12.673¢/kWh).

But, that is comparing to NGrid’s basic residential rate. NGrid does offer rates for businesses. The plan is 1.066¢/kWh lower than the current small business rate through April. But it’s higher than the medium and large business rate through the end of January. 

Patton said that most medium/large businesses have likely already contracted for a power plan. But any who haven’t will probably want to opt out of the Town plan. (For more details on business rates, click here.)

For residents, Patton used an example of a homeowner’s bill at 480 kWh, saving about $8 per month. (That’s well below my average kWh. Given the number of larger homes in town and that some homeowners have electric heat, I imagine that many would see much bigger savings than that.)

It is possible for NGrid’s rates to go down after April 30th. But, no one is locked in. So, if you find a plan down the road that you like better (including the NGrid basic option), you can opt out then (see “Opt out schedule” below).

I already shared most of the details she spoke about in my December post. But there are details worth adding or reiterating.

• Intent – The plan was pursued by the Town to use the community’s buying power as leverage for a better supply rate.
• Customers signed to other plans – If you are committed to another supplier contract, you can wait until that is completed (to avoid cancellation penalties), then switch over to the Town’s plan for the original rate.*
• Solar panel owners – Customers with solar panels would still benefit from net credits. Plus, while energy is purchased at the plan rate, the sell back “credit rate” (for producing more energy than used) is calculated at NGrid’s base rate – which is currently higher.
• Low income – Customers who qualify for low income credits will still get that deduction off the total bill.
• Power delivery – NGrid will still “deliver” the electricity:
  • They will still be the point of contact for power problems, etc.
  • The bill will be from NGrid with the delivery fee section unchanged. (Those are the fees for customer charge, transmission charge, etc. Patton explained that those are negotiated with the state.)
• Power Choice Green – This optional upgrade gives you 100% renewable energy, all generated by renewable energy projects in New England. (That costs 12.740¢/kWh which is more than the basic service through either Public Power or NGrid.) To sign up for that option, call Public Power at 1-800-830-2944.
  
• Secure option – Under regulatory requirements, there is backing that ensures that even if the supplier fails, customers will receive the power at the contracted price.
• Opt out schedule* –
  • To avoid rollover, act before the January 22nd deadline.
  • After that you can opt out at any time, but only effective on meter read dates. That means the next bill you receive will be at the plan rate. The change would be seen on the following bill.
• How to opt out – There are three ways:
  • Sign and mail back the opt out section of the reply card in the mailer the Town sent out.
  • Call Public Power at 800-830-2944
  • Contact Public Power through the website (Note: the supplier is Public Power, but the the websites refer to the plan under Southborough Power Choice or Mass Power Choice.)
• Comparing future NGrid rates – NGrid rates change about every six months (Med/Large business rates will change Feb 1st. Residential and small business will change May 1st.) Peregrine will update the Town’s website when information on new rates is available. So to compare rates in the future, and see if you want to opt out then, visit Southborough Power Choice.*

The mailer that was sent out had the Town of Southborough’s seal on the envelope and the enclosed letter. If you received something different in the mail, it wasn’t for the Town’s plan.

If you received that mailer, you will be automatically enrolled unless you make the effort to opt out. (That is required by the state law for Municipal Aggregation. It helps encourage bidders with more competitive pricing.)

If you didn’t receive that mailer, you shouldn’t be rolled over.** 

You can watch the info session here. Or check out the Town’s web pages on the plan here.

If you need help navigating your options – you can contact the Town’s consultant company, Peregrine Energy, at 833-272-9591 or southborough@masspowerchoice.com. (They don’t work for the energy company. They work for the Town to help coordinate a plan that works for the community. So, you won’t be talking to a salesperson incentivized to sign you up whether the program is right for you or not.)

So, why did I mistakenly post that the intent was to use the community buying power to save on municipal utilities while little in savings would be seen by residents? (Some of you might not care. But I want to be transparent and feel I owe an explanation for the shoddy reporting!)

It seems that when I initially began covering the Town’s efforts in 2015, I had that story right. I even posted correctly in 2016 and spring 2017. Where I got confused was sometime over the past summer and fall.

I have a memory of Town Administrator Mark Purple saying that most households wouldn’t see significant savings. But I can’t find video that verifies that memory is accurate. (Am I misremembering? Did I misunderstand? I’m not sure.)

But I did find other statements in the October 17th presentation to selectmen that reinforced my misperception this fall. (I’m not trying to point fingers at others. In revisiting the presentation and my notes, I understand now that I misinterpreted and made inaccurate leaps of “logic”. I’m just sharing what I pieced together on how that happened.)

Most relevant was a consultant’s response to a question from Lisa Braccio. At the time of the presentation, the Town had yet to see bids and sign a contract. She asked about the types of savings generally seen by residents when Towns enter these plans.

Consultant John Shortsleeve of Bay State Consultants responded:

The last time I looked at that was probably a year ago, and at the time the the average savings as compared to the utility rate was about 3/10 of a cent. It’s not a lot of money per household, it can add up town wide.

To me, the savings per house seemed too small to be the motivation for pursuing. And I had already made a prior assumption along the way that the Town would naturally take advantage of the same savings.

My assumption about the Town’s involvement was bolstered by Patton’s presentation prior to Shortsleeve’s comment. The powerpoint noted:

National Grid will continue to deliver electricity to Southborough, but the Town will now choose its own electricity supplier.

I interpreted the Town’s own supplier as supplying power to the Town of Southborough’s properties (rather than just customers with properties in Southborough).

Patton explained about the bidding process, stating:

if you like what you see, you select a supplier and sign a contract.

Based on the singular – I assumed one contract that would serve both the Town and residents.

Patton also noted customers’ ability to opt out at any time, following:

The only people that are locked in is the Town locking the supplier in with its price.

In my original notes, I took that as the Town being locked in to paying the prices. Upon review, I now take that to mean the supplier is committed to offering the price.

Once again, I apologize for muddying the waters.

*During the term of the Town’s plan, the rate is guaranteed to any new power customers or customers currently committed to other contracts. That’s not true for customers who “opt out” of the plan.

Anyone who opts out, then tries to opt back into the plan isn’t promised this rate. That is to avoid the risk of a large % of customers switching back and forth when NGrid’s rates change. But – the supplier may offer you the same rate if it chooses. To find out the options available to you at that time, you would contact Public Power.

If the Town makes a new contract, past the current two year term, every metered customer in Southborough would be eligible to participate.

**I wrote “If you didn’t receive that mailer, you shouldn’t be rolled over.” I didn’t promise “won’t”, because I’ve had things go missing in the mail before. (Maybe stuck to/in junk mail?) So, if you believe that you are on the National Grid basic default plan, but you didn’t see the mailer, then you may want to follow up.