A binding referendum on the March primary ballot will ask Evanston voters to authorize the City to bundle (aggregate) residential and small business electric accounts and seek bids for a cheaper – and possibly greener – energy supply. This process is known as Community Choice Aggregation (CCA).
Currently, ComEd purchases electricity on behalf of its customers at a price set by the Illinois Power Agency. With CCA, the City can bundle residential and small business accounts and seek a lower price on the open market for these customers. (Large industrial and commercial enterprises already use this option to obtain market-based pricing and reduce their energy costs.)
An Aggregation Plan with Public Input
If Evanston voters approve the referendum, the City will host at least two public hearings to discuss and create an Aggregation Plan of operation and governance. The plan will specify cost savings targets, the mix of energy sources desired and contract duration. The City will use these criteria to evaluate the proposals it receives.
Once the plan is in place, the City will issue a Request for Proposals. Only energy suppliers certified by the Illinois Commerce Commission will be eligible to respond. The bid that best meets the goals outlined in the Aggregation Plan will be accepted.
If none of the bids is satisfactory, the City is not required to accept any of them. If the rates proposed are higher than the current ComEd supply rate, for example, the City does not have to award a contract to any of the bidders. In such a case, there would be no change in electric rates for the aggregated accounts.
An Opportunity to Further Evanston’s Sustainability Goals
Oak Park’s newly approved CCA program, for example, includes 100 percent renewable energy while achieving a cost reduction of 24.3 percent in the supply portion of customers’ electric bills.
According to ComEd’s most recent Environmental Disclosure Statement, coal accounted for 44 percent of the electricity supplied to its customers for the 12 months ending September 30, 2011. Nuclear power provided 40 percent and natural gas another 12 percent, with the balance from other sources, including renewables.
Obtaining 100 percent renewable energy as Oak Park has done would allow Evanston to reduce its greenhouse gas emissions significantly. According to a scenario (based on 2010 emissions figures) provided by the City’s Office of Sustainability, a CCA program with 100 percent renewables would reduce Evanston’s carbon dioxide emissions by approximately 284,000 metric tons/year – the equivalent of taking some 56,000 cars off the road.
Reducing reliance on coal would have other important benefits. Coal-fired power plants are a major source of emissions of mercury (a highly toxic metal particularly harmful to children), sulfur dioxide and nitrogen oxides (the primary causes of acid rain), and fine particulate matter (a contributor to asthma and other respiratory problems).
In a renewable energy scenario, Evanston would not receive energy directly from a specific wind farm or solar array — just as Evanston is not currently linked to a particular coal-fired or nuclear power plant for its electricity. Renewable energy would be obtained indirectly, most likely via Renewable Energy Certificates (RECs). One REC is created for each megawatt-hour of renewable electricity generated and delivered to the power grid. RECs can be sold on the open market, providing the renewable energy project owner with an additional revenue stream and improving the economics of renewable energy production.
An “Opt-Out” Program
Residents and small businesses that do not want to participate in the CCA program can opt out altogether. The opportunity to opt out will be available after the CCA electricity supplier has been chosen and the supplier’s electricity rate is made known. Those opting out will continue to receive electricity at the ComEd rate.
Residents and small businesses who have already switched to an alternate retail electricity supplier cannot participate in the CCA program until their contract with that supplier has ended.
In addition, CCA participants will not be able to take advantage of ComEd’s Residential Real Time Pricing (RRTP) program. The RRTP program offers residential customers a way to reduce their electric bills, but it cannot be used in conjunction with aggregation.
ComEd’s Continuing Role
ComEd is an electricity distribution company. It will continue to be responsible for the system’s infrastructure — the power lines, transformers, and meters that bring electricity to Evanston homes and businesses — and for billing and responding to power outages.
CCA participants will continue to receive a single bill for their electricity — from ComEd. The “electricity supply services” portion of the bill will reflect the new supply rate achieved through aggregation. The “delivery services” portion of the bill will remain unchanged and show the cost of power distribution by ComEd.
An Opportunity to Save Money And Go Green
Citizens’ Greener Evanston urges Evanstonians to vote “YES” on the Community Choice Aggregation referendum and help secure an energy supply that is both cheaper and greener. More information about CCA is available at www.1save2vote3gogreen.org.