Illinois law allows communities to band together through an Intergovernmental Agency process to help achieve efficiencies amongst the participating communities. Six cities/villages within McHenry, Kane and DeKalb Counties have come together to form the Northern Illinois Governmental Electric Aggregation Consortium (NIGEAC). The NIGEAC is comprised of the Cities of Genoa and Woodstock and the Villages of Algonquin, Huntley, Lakewood and Ringwood.
By combining our communities we are able to achieve efficiencies and increase our bargaining power with Alternative Retail Electric Suppliers (ARES). We have retained Independent Energy Consultants, Inc. at no cost to the taxpayers to assist us with the design, implementation and administration of our program. Independent Energy Consultants is licensed by the Illinois Commerce Commission as an Agent/Broker/Consultant and is a pioneer in the field of Governmental Aggregation for electric and natural gas programs.
Electric Aggregation Program Update - Suspended June 2017
Residents in the Cities of Genoa and Woodstock and the Villages of Huntley, Lakewood and Ringwood passed Electric Aggregation ballot initiatives on March 20, 2012. The Village of Algonquin passed the ballot initiative on March 18 ,2014. This gives officials in those communities the authority, but not the obligation, to pursue an electric aggregation program through the efforts of NIGEAC. Following passage of the ballot, the NIGEAC communities each held two Public Hearings to explain their Plan of Operation and Governance. Those Plans are identical and are used by NIGEAC to administer the Aggregation Program.
The NIGEAC received a number of supplier bids earlier this spring to continue its program beyond the current term ending with the July 2017 ComEd billing cycle. Unfortunately, the savings produced by those bids were not in line with previous years and a decision was made to suspend the program. Many similar aggregation program suspensions have occured across Illinois and more are aniticipated.
The NIGEAC supplier, Constellation Energy Services (Constellation) has taken steps to return all NIGEAC participants back to ComEd's supply service, and residents can expect to receive a notice from ComEd informing them of the same.
Residents returning to ComEd's supply may stay with ComEd's supply or select a supplier on their own. Alternative Retail Electric Supplier (ARES) offers may be found on the Plug in Illinois website. In order to save money versus the ComEd alternative, residents must find an offer less than the current ComEd tariff rate of 6.987 cents/kWh. That avoidable cost from ComEd is set for the four summer months of June-September. The avoidable cost for a shopping customer is scheduled to increase to 7.245 cents/kWh for the subsequent eight winter months of October-May 2018.
The suspension of the NIGEAC Electric Aggregation Program does not preclude it from restarting, should better savings opportunities present themselves in the future. Suspension and restarting of Aggregation programs has been fairly routine in other states with opt-out aggregation, and may become commonplace in Illinois. For now, the NIGEAC will continue watch the energy markets and ComEd's rates and will notify you if a decision is made to restart the program.
With “opt-out” aggregation programs all eligible residential and small commercial customers are included in the program unless they decide to opt-out. The participation rate for opt-out programs tends to be very high, and because of this, suppliers may be able to pass on lower rates. This program presents another option for our residents and small businesses in their attempts to manage their energy costs.
This program impacts only those residents and small businesses in the NIGEAC communities. This program does not guarantee savings but does present another valuable option for our residents and small businesses in their attempts to manage their energy costs.
State legislators have used a phased-in approach to deregulate the Illinois electric markets. It began in 1997 when the largest industrial customers were afforded the ability to choose an ARES. We have now reached the final stage of deregulation, and not only do individual residents have the right to choose their ARES, but communities can form Opt-Out Aggregation Programs to leverage that bulk buying power. Most of the residential and small commercial customer switching and savings are expected to come through Governmental Aggregation Programs similar to what NIGEAC is offering.
Electric Aggregation Frequently Asked Questions
What is an “opt-out electric aggregation program”?
Electric aggregation is a process that allows governments to pool, or aggregate, the electric usage needs of residents and small businesses. Local governments are then able to seek lower pricing for their residents and small businesses through a competitive bid process. Opt-out programs generally have high participation rates and thereby greater bargaining power than individuals have to negotiate lower electric rates from Alternative Retail Electric Suppliers (ARES). Eligible residents and small businesses are included in the program and permitted to opt-out, if they chose not to participate. The process is being modeled after successful programs in other states that have over 10-years experience with Governmental Aggregation programs.
How will I sign up for the program? Do I Have to Participate?Eligible residents and small businesses will receive an opt-out letter from Constellation that explains the program rates, terms and conditions. The notice also provides instructions on how to remove yourself from the program, if you think it is not right for you or your family. Residents have 21 days to make that decision. If you would like to remain in the program, simply do nothing and you will be automatically enrolled.
The program has been suspended effective with the July 2017 billing cycle. Members are being returned to ComEd's regulated supply service. Residents interested in seeking offers on their own should consult the Plug in Illinois website.