La Grange Park, Your Electric Rates Could Be Headed Down

With big savings on electric rates on the line, trustees listened and asked a lot of questions at a recent Nov. 22 board meeting where a discussion of bundling the village's electric rates took center stage.

Time is winding down for the village to get the best deal possible, a consultant told the board. The board must approve a referendum by Dec. 31 if it will appear on the ballot for La Grange Park residents in March.

La Grange Park would follow 19 other area communities including Oak Brook and Wood Dale who put the opportunity before residents in April and started seeing savings in August this year.

Dave Hoover, president of the Northern Illinois Municipal Electric Collaborative (NIMEC), told board members that the savings stem from the power of group buying.

“What we’re talking about is the opportunity for the board to favorably affect billing rates for all your residents and businesses in La Grange Park,” Hoover said.

Hoover told the board that NIMEC works as a matchmaker for municipalities. The collaborative solicits bids for rates from ComEd's competitors in order to get the best rate for the village as it joins with other communities looking for savings.

Competition Between Rate Suppliers

Hoover told trustees that prior to 2007, ComEd was "one stop shopping" for the village's electricity. The state has since opened up more competition between rate suppliers by separating the creation of electricity from its supply to homeowners and businesses.

ComEd competitors like Spark Energy and Blue Star have since been offering discounts of about 5 percent to customers who make the switch. But with an entire village going all in for the electric supply and partnering with other municipalities, the savings can be as great as 20-30 percent.

If the village makes the switch, Hoover said, residents would still get their bills from ComEd, but with deeper discounts.

Village Must Act Before Dec. 31

La Grange Park Trustees will need to pass an ordinance by Dec. 31, putting the issue before the public in a referendum if they want to see the best deals, Hoover told the board. The Dec. 31 deadline is required to get the issue on the March 20 primary election ballot.

Trustee Rimas Kozica asked if the board passed on the opportunity this time, would they still be able to put the referendum on the ballot in November? Hoover said they could, but warned that the savings would not be as deep in the future as electricity rates from ComEd competitors were not expected to continue to drop.

If passed, the timetable for savings would first be a bid for a reduced rate in June after ComEd releases its rate information in May. Residents would start to see savings on their bills by September 2012, Hoover said.

Lots of Questions from Trustees

Trustees asked a lot of questions on Tuesday night, but did not give much indication of their feelings one way or the other.

Does it affect ComEd negatively?" Trustee Scott Mesick asked. "I’m a capitalist, why does ComEd have to do the billing?"

In a similar line of questioning, Trustee Marshall Seeder asked Hoover if Exelon (ComEd's parent company) has fought any of the deals.

Hoover replied that no, ComEd has told state lawmakers they are indifferent to continuing to bill customers on behalf of their competitors and that Exelon has not fought any community's efforts to bundle their rates. Overall, he said, Exelon was still making money through the creation of the power the new companies are providing.

Additionally, if La Grange Park joins with NIMEC, ComEd's competitor, not the village, will pay NIMEC's consultant fee. NIMEC, Hoover said, would also work with the village to supply information to residents about the changes they would see on their bill. Should a resident wish to opt out and continue with ComEd or a different company than what is chosen by the board, they could by calling and changing their service.

The board will revisit the issue for further discussion at their Dec. 13 board meeting.