Huntley Looking to Help Cut Electrical Supply Costs for Residents, Small Businesses

A year ago, municipal electricity aggregation was a concept, a consultant told Huntley trustees Thursday night.

Today, it’s all the rage.

Huntley is poised to start the process of establishing a municipal electricity aggregation program it hopes will help save residents money on their electric bills.

What is municipal electricity aggregation?

It’s the process where a county, city or village acts on behalf of all or part of its constituents to negotiate a bulk rate for the electrical supply, which results in a lower cost, Village Manager Dave Johnson said, referring to a PowerPoint shown at Thursday’s meeting.

The deregulation of electricity has helped open the door for this type of program as did an Illinois statute, officials said.

There are two options the village has: an opt-in or opt-out program. Huntley would seek an opt-out program because it would help generate the most savings by including residential and small businesses unless individuals chose to opt-out, Johnson said.

Voters would have to authorize the village to negotiate the rate in an opt-out program by passing a referendum. The village board Thursday directed staff to start working on the wording of such a referendum. It would be included on the March ballot, Johnson said.

The board needs to agree to seek a referendum by early January.

There’s a nine-step process that includes hiring a consultant and educating the public about the referendum.

Mike Mudge is a consultant with Rock River Energy Services Co. is a consultant who explained the process. Many towns are moving to municipal electricity aggregation, he said.

He explained ComEd would still be responsible for delivery service and would continue to charge. It currently buys power and passes that cost onto customers.  However, the municipal electrical aggregation program would let the village seek bids to get a better rate on the electrical supply, Mudge said.

Mudge just heard a radio spot for a supplier promising residents they can lower their electrical supply rate by 12 percent, but he said a municipal electricity aggregation program can save residents double that rate, he said.

A step in the process would be educating the public about the referendum, Johnson said. The village would be providing literature to households explaining the nuances, he said.

Trustees seemed onboard with the idea of establishing such a program. McHenry County and other McHenry County governmental organizations are looking into the idea as well, which would give Huntley even more negotiation power, Mayor Charles Sass said.

If the referendum passes, the village would go out to bid in the summer of 2012 and would have a contract in place by the fall, Johnson said.