Vote planned on consultant for Danville electric program
DANVILLE — The city council will vote Tuesday night on whether to hire Good Energy as the city's consultant in implementing an electric aggregation program that would be separate from Vermilion County's program with Integrys.
Mayor Scott Eisenhauer said it's in the city's best interests to go with a consultant, which would guide it through the process, including promoting an April referendum and soliciting bids for rates for residents and commercial customers.
Eisenhauer said he got information from six consultants, narrowed them to two and is recommending approval for a contract with Good Energy. The council meets at 6 p.m. Tuesday in the Robert E. Jones Municipal building, 17 W. Main St.
Municipal electricity aggregation allows municipalities to pool their residential and small commercial electricity customers into a buying group that has more leverage in seeking bids for rates lower than those paid by Ameren customers.
Voters in the city must first authorize it to proceed with an opt-out electric aggregation program; the city council approved an April referendum for that. If a majority says yes, then Good Energy will pool all prospective Danville customers with customers in other municipalities it has contracted with for the bidding process that follows.
The contract with Good Energy will not cost the city anything, Eisenhauer said, even if the April referendum does not pass. Good Energy will cover the costs of the referendum, including promoting it and educating residents about why they must again vote on electric aggregation. If it passes, Good Energy will be compensated through a fee of 0.0075 cents per kilowatt hour that will be added to whatever rate the city gets in the bidding process.
The city could also tack on a fee to generate revenue; Eisenhauer said that decision has not yet been made. He said the city has until bidding starts to decide on its possible fee.
The county decided to collect a fee, and county officials were hoping when they thought the program would be countywide that that fee would generate enough money to pay for a bond issue for renovations at the Vermilion County Courthouse.
According to its website, Good Energy is headquartered in New York, with its electric-aggregation operations based in Peoria. It has implemented aggregation programs across the country since 2008 and has worked with more than 100 Illinois municipalities and counties, including Urbana, Champaign County and Decatur.
In their respective bidding processes handled by Good Energy, Champaign County got a rate of 3.9999 cents per kilowatt hour, and Urbana, 4.055 cents per kilowatt hour.
Last year, Vermilion County decided against using a consultant and seeking bids for its electric aggregation program, which started last fall. Instead, officials contracted with Integrys to implement its program and get the county a rate, which ended up being 4.26 cents per kilowatt hour.
A countywide referendum passed in November, and Integrys moved forward with an opt-out program, which means all eligible customers are automatically enrolled in the program and receive the lower rate unless they opt out.
But the Illinois Power Agency ruled that the county's opt-out program would be valid only in unincorporated areas. It ruled that Integrys could offer a voluntary program in the incorporated areas, including Danville, meaning customers had to voluntarily sign up by making a call or going to a website.
That's when municipalities in Vermilion County began taking steps to hold their own referendums this April with intentions of implementing their own electric aggregation programs.
Good Energy officials said if the April referendum passes, Danville customers can expect to see savings on their electric bills sometime this summer.
If the city's bidding results in a lower rate than what's offered through the county's program with Integrys, then any customers in Danville who signed up with Integrys can end their agreement with no penalty and go with the city's program, according to Eisenhauer and Good Energy officials.
Joe Bullivant, the Illinois Aggregation Program manager with Integrys, said Integrys has about a 90 percent participation rate with its opt-out program in the unincorporated areas of the county. Between its voluntary program and the opt-out program, Bullivant said Integrys has more than 6,000 customers, and that should generate about $345,000 in revenue for the county for the duration of the contract with Integrys.