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Power Supplier Named for West Orange Community Energy Aggregation Program

Con Edison Solutions will be the power supplier for residents who choose to participate in the West Orange Community Energy Aggregation Program

File Photo of Town Hall
File Photo of Town Hall
Submitted by Township Public Information Officer

The West Orange Township Council has passed a resolution to award a power supply contract to Con Edison Solutions to provide power supply to Township residents for a 21-month period beginning in March 2014. The contract is estimated to immediately save residents nearly eight percent as compared to the price for power supply that is being charged by PSE&G.

Over the full 21-month term of the contract, the average savings for a typical Township resident will be approximately $120 dollars. Aggregate savings for Township residents is estimated at about $1.8 million over the life of the contract.

The contract award is the result of the West Orange Community Energy Aggregation (WOCEA) program that was launched by the Township earlier this year. West Orange is one of only a handful of municipalities in the state to successfully award a power supply contract under the Government Energy Aggregation (GEA) Act, which gives municipalities the authority to undertake a bulk purchase of power supply for its residents.

“As home to Thomas Edison’s laboratory, West Orange has long been at the epicenter of innovation in the energy industry,” Mayor Robert Parisi said. “With the successful implementation of one of the first community energy aggregation programs in New Jersey, the Township is continuing that tradition.”

The contract signed with Con Edison Solutions sets a fixed price per kilowatt-hour for power for 21 months. All residents not already being served under a third-party supplier contract are eligible. The program also provides for the continuation of budget billing for those residents who have similar arrangements with the electric utility. 

Participation by residents in the program is voluntary. All eligible residents will receive a mailing containing a program description and an ‘opt-out’ card. Before enrolled in the program they will have a 30-day period to decide if they wish to ‘opt-out’ of the program.

Program announcements and ‘opt-out’ cards will be mailed out to residents at the end of December. For those residents that do not ‘opt-out,’ power supply under the Con Edison supply contract will begin in March 2014. Those residents that are already under contract with another third-party supplier will not be initially eligible. However, when their existing third-party supply contract expires they will have the opportunity to be included in the WOCEA program.

 

Con Edison Solutions was selected among six power suppliers who submitted proposals, providing the lowest bid price for residential customers. Con Edison Solutions is part of Con Edison, Inc., which also owns two regulated utility companies and various competitive energy businesses. Con Edison Solutions is a licensed power supplier in 13 states including New Jersey and provides retail electric supply services for more than 270,000 residential customers. They also have prior experience administering Government Energy Aggregation programs for residential customers in New Jersey, Massachusetts and Illinois.

 

PSE&G will continue to provide delivery service and will still issue a single bill for electricity. The PSE&G bill will include charges for delivery service, and a separate line item for power supply received from Con Edison under the WOCEA program. The contract with Con Edison includes a requirement that they provide budget billing for power supply charges for those customers that have equal payment plans with PSE&G. 

 

The WOCEA program was implemented with the assistance of the energy consulting team hired by the Township consisting of Gabel Associates, a state-registered energy agent, and Cooling America through Local Leadership (CALL), a not-for-profit entity. The WOCEA program was structured so that the Township does not incur any out-of-pocket expenses for consulting fees or professional services.

 

“The Mayor and Township Council demonstrated tremendous innovativeness and leadership in forming the WOCEA program and seeing it through to fruition,” Gabel Associates President Steven Gabel said. “We also had great support from the New Jersey Board of Public Utilities, the New Jersey Division of Rate Counsel and PSE&G. Moreover, Con Edison has been the selected supplier on other GEA programs in New Jersey in which we have been involved. These programs have run very smoothly and we expect the same performance on the WOCEA program.” 

“We are constantly looking for innovative opportunities to create cost savings for our residents," Parisi said. "Under this energy aggregation program, we have been able to create the kind of bulk purchasing power for residents typically only enjoyed by large businesses and government institutions. We have successfully leveraged that buying power, through a competitive bid, into welcome energy cost savings and price stability for Township residents.”
SMFlatow December 16, 2013 at 08:02 AM
I truly don't understand what is in this for the municipality of West Orange. And why do I have to opt out of the program? If something looks to good to be true, is it true?
Kelly Wenzel December 16, 2013 at 09:06 AM
This is just my understanding: The more people who enroll in the program the less we pay for electric - so they do the "opt-out" knowing that most people won't send in the card, therefore creating a larger membership.... larger membership = lower price. Essentially, West Orange has contracted with ConEd to buy power in bulk instead of individual households contracting with PSE&G or another provider. Think of it as getting your BJ's membership to buy bulk peanut butter. As for the municipality - there is probably some sort of arrangement where W. Orange gets a share of the profits earned from the contract. So, if ConEd makes $100M off of this deal, W. Orange may see $100K back to the township.
SMFlatow December 16, 2013 at 09:53 AM
Well, I'm hoping that the materials we receive will allow us to make a $ for $ comparison between the ConEd rate and the PSEG rates we are paying now.
Kelly Wenzel December 16, 2013 at 02:07 PM
Here's a more complete answer: http://www.westorange.org/DocumentCenter/View/1091
Vicki Russo December 31, 2013 at 09:16 AM
Looks good to me. Anything that saves me money and the Twon gets money back to reduce our property taxes can't be BAD. I'm In
SMFlatow December 31, 2013 at 09:41 AM
I just received the flyer from the town and have decided to opt out. Frankly, the difference between PSEG and ConEd is fractions of a cent so it looks like I'd be saving $5 a month with the new program. It's simply not worth the chance of having the program blow-up in my face.

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