by Paul Fenn Ohio's 1999 Community Choice Law celebrated its first milestone on February 15 when 100 municipalities with 450,000 electricity customers chose Green Mountain Power as their electricity provider for 6 years, switching from 60%coal/40% nuclear power to 98% natural gas/2% renewable energy.
The consortium of cities formed the Northeast Ohio Public Energy Council (NOPEC), a public electricity buying group, in the months following passage of the 1999 Ohio Community Choice law, which allows municipalities or groups of municipalities to negotiate power supply and energy services agreements on behalf of their residents and businesses as whole communities. Other than Ohio, only Massachusetts has a Community Choice law, the first in the United States (1997). Community Choice legislation has been sponsored for the California energy crisis by Assemblymember Carole Migden (D-San Francisco), chair of the Appropriations Committee.
Green Mountain CEO Dennis Kelly said Green Mountain intends to build a wind turbine facility somewhere in Ohio, possibly on Lake Erie, and will install photovoltaics on at least one school building in each of the eight NOPEC counties, which include Cuyahoga, Geauga, Lake, Portage, Summit, Lorain, Ashtabula, and Medina counties. Under the agreement Green Mountain will serve these communities from September, 2001 through December, 2006.
Community Choice advocates, who have long argued that community buying power would deliver environmental benefits, now point to the fact that the Cleveland area Community Choice contract alone has increased Green Mountain's customer base from 100,000 to 550,000. "This decision not only means continued business momentum for Green Mountain Energy, but it also validates the emerging viability of, and mainstream demand for, green power on a mass scale," said Kelly.
The nation's largest ever energy aggregation contract is attracting attention for its potential as a green power vehicle. "Considering that Green Mountain is the largest clean power company in America, it is significant that a single contract for a group of unknown municipalities in Ohio would quintuple its customer base," said Shari Weir of Citizen Action, which organized political support for Community Choice during the state legislature's electric deregulation proceedings. "It shows that Community Choice is much more effective at delivering clean power than the isolated "Consumer Choice model that passed in California and subsequent states."
"When the NOPEC board selected Green Mountain for its constituents, they not only chose cost-effective electricity featuring renewable sources, but the promise of cleaner air, too. With today's ground-breaking agreement, Northeastern Ohio ow leads the nation in terms of its commitment to providing cleaner and renewable energy to its citizens and commercial enterprises."
Green Mountain defeated its competing bidder, American Electric Power, by proposing both clean energy and a commitment to save consumers $12 million to $436 million over six years. Individual consumers will see a six to eight percent decrease in the energy portion of their electric bills, including the five percent increase required by the deregulation law. In addition to supplying electric service, Green Mountain has also agreed to work with NOPEC to provide its residents with natural gas at discounted prices. The state legislature is now considering legislation authorizing Community Choice of natural gas.
"We are tremendously excited to have reached this understanding and look forward to a lasting partnership with Green Mountain Energy," said Eastlake Mayoy and NOPEC chairman Dan DiLiberto. "Not only will the contract we hope to sign offer savings to the people we represent, it also would provide them with 'green' power, something which many environmentally conscious consumers in other states have been willing to pay a premium for."
The understanding also calls for Green Mountain Energy to pay any fees charged to consumers for initially switching to Green Mountain Energy. Former monopoly utility FirstEnergy plans to charge a $5 per customer switching fee, which NOPEC considers exorbitant, unjustified and discriminatory, and has asked state regulators to eliminate.
Once the agreement is finalized, consumers in the NOPEC counties will receive notification of the rate and terms of the contract by mail. They will have 21 days after that notification to opt out and either remain with Ohio Edison or shop for a power supplier on their own.
Copyright 2001 by Local Power.