Energy proposal may save money for N.B.
Towns join in effort to buy cheaper electricity through aggregation
BY JENNIFER KOHLHEPP
Staff Writer
North Brunswick may see a reduction in its electricity costs if a Middlesex County authority succeeds with a new program.
The Middlesex County Improvement Authority (MCIA) offered the Township Council the opportunity to buy into an electric aggregation program that could reduce the cost of electricity during the Jan. 26 workshop meeting.
According to MCIA spokesman Ted Choplick, the township could save between 3 percent and 11 percent on their total electric costs.
"We believe that the more municipalities we can get to enter into this agreement, the better the prices," Choplick said. "I would say that the township average in savings over the first 8 months would be about 5 percent."
The mayor and Township Council authorized the MCIA to take the township’s electricity account numbers and meter consumption information to add to the bid.
"Although we have not formally agreed to enter into a contract with the MCIA, we did furnish them with the data," council President Carlo Socio said. "Our rationale is that it would be easier for them to take a municipality out of the bid than to add one in once they start the bidding process."
Choplick said most municipalities in the county have already committed to the program, including surrounding townships such as East Brunswick, Edison, Monroe, and New Brunswick.
"We’re still waiting on a phone call from South Brunswick," Choplick said. "Most of the other accounts we’re missing are the smaller township accounts."
The county wants the township to commit to a five-year agreement, he said.
"After we get the basic cost, we will go to third-party suppliers to get the best price," Choplick said. The basic cost bid could take four to five months to set, and the bidding process could take up to two years, he added.
The township could opt out of the program any time during the bidding process, but not afterward, according to Choplick.
The mayor and Township Council did express concerns with regard to entering into such a contract.
"We’re just concerned that if we buy into such a program that we will pay more than what we are already paying for energy," Mayor Francis "Mac" Womack said.
Despite how many municipalities enter into the program, Choplick said the downside is the program may not yield any cost savings.
"In my research I have discovered other areas that have entered into such agreements that did not seem to provide any value," Socio said.
Councilman Robert Corbin questioned if suppliers, like Public Service Electric & Gas (PSE&G), could retaliate against municipalities entering into such an agreement.
"Can the supplier, who own the proprietary rights to the power lines, increase costs if we entered into such a program?" Corbin asked.
Choplick said state law would not allow suppliers to unnecessarily raise prices.
"You can still buy energy from any party and they have to give you the basic price," Choplick said. "Suppliers would also have to continue to maintain their own lines."