Electric Aggregation - Post Referendum

Electric Aggregation - Post Referendum

  Wednesday, March 21, 2012    Julie Tappendorf

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A number of Illinois municipalities had a referendum on yesterday's ballot asking voters whether they are in favor of municipal electric aggregation.  The voters have spoken, and an overwhelming number of these referenda passed.  So, for those municipalities that had their referendum approved, the process is just beginning.  Before a municipality can go out to bid for electricity to serve their electric utility customers, the following steps must be taken:

Adopt an Ordinance to Authorize Electric Aggregation Program:

The first step after the referendum has passed is for the municipality to authorize the "opt out" electric aggregation program by ordinance.  

Develop a Plan of Operation and Governance

After approval of the authorizing ordinance, the municipality must develop and approve a plan of governance for the electric aggregation program.  The plan must describe how the electric aggregation program will operate and include the following:

·         provide for universal access to all applicable residential customers and equitable treatment of applicable residential customers

·         describe demand management and energy efficiency services to be provided to each class of customers

·         meet any requirements established by law concerning aggregated service offered pursuant to the statute

Notice and Hold Two Public Hearings

The municipality must conduct two public hearings to consider the plan.  Notice of the public hearings must be published in the newspaper at least once a week for two consecutive weeks prior to the first public hearing. 

Approve the Plan of Operation and Governance

After both hearings have been held, the municipality must approve the plan.

Conduct a Public Bidding Process

After the municipality has approved the plan, the municipality must conduct a public bidding process to identify electrical suppliers.  Some municipalities may decide to use the services of a broker to assist in the public bidding process; others may enter into intergovernmental agreements with other municipalities to pool their customers in the bidding process.

Enter into an Agreement with Supplier

After choosing a supplier, the municipality (or pool of municipalities in an intergovernmental agreement) will negotiate and enter into an agreement with the supplier.  That agreement must be approved by the municipality.

Send Notice to Electricity Utility Customers

In an opt-out program, the statute requires that the municipality notify electric utility customers of the electricity rates, the conditions of enrollment in the electric aggregation program, and provide customers with the option to “opt-out” of the aggregation if they choose to receive electricity through ComEd or another alternative supplier.  If a customer does not affirmatively opt-out, that customer will be automatically enrolled in the aggregation program. 

Post Authored by Julie Tappendorf, Ancel Glink