The Township Committee recently struck a deal with PSE&G that will ultimately enable the township to start the bidding process for a third party energy supplier in hopes of trying to slash home
By Charley Falkenburg, Staff Writer
MONTGOMERY – The Township Committee recently struck a deal with PSE&G that will ultimately enable the township to start the bidding process for a third party energy supplier in hopes of trying to slash homeowner utility bills.
The agreement marks the township’s next step in trying its luck with the new state energy aggregation program. The initiative gives local municipalities that option of shopping around for a cheaper energy supplier on behalf of its residents who haven’t already entered into contracts.
Under the agreement, PSE&G is expected to supply the township with data such as the number of residential customers who aren’t already in contracts and usage rates so potential bidders have an accurate scope of the work they would be doing. In return, the township would reimburse PSE&G up to $750 in associated costs, according to the resolution.
”This is a precursor step to the program,” said Robert Chilton, the vice president of Gabel Associates, which is the firm the township contracted to do the scouting. “This doesn’t commit the township to anything at all other than providing the vehicle for the town to get the information needed to go out to bid.”
Officials estimated the township would officially go out to bid in August after the documents are reviewed by Board of Public Utilities (BPU) and Division of Rate Counsel and finalized. Should the committee find a company that could provide substantial savings, a contract will be awarded and Montgomery would become the second municipality to be part of the state program. Plumsted became the first last year after it awarded a contract to a third-party supplier.
“We’re still interested enough to go through the bid process to see if there are savings to be had,” said Mayor Ed Trzaska. “If there are some good savings, we will decide if we want to move forward and if they come back and they’re not attractive, then the program ends and we don’t commit.” Town officials have estimated Montgomery homeowners could see up to 15 percent in savings, or about $150 to $200 reduction in an average household’s electric bill each year. Should the township sign a contract, homeowners who don’t already use a third-party supplier would automatically be opted in although they would be able to opt out at any time without being penalized. However, the automatic opt-in has received criticism from residents who are concerned about the local government overstepping its boundaries. “I think there’s a sense this is a situation where the government is overreaching its authority by signing people up for a commercial arrangement that is in their ‘best interest,’” said resident Walt Beadling. “I think it’s a step in the wrong direction however well-meaning the program might be.” On the other hand, commercial businesses looking to participate would not automatically be included and would have to opt in to the program. Officials explained those who would stay in the program would see little difference other than the savings. Everyone would still be serviced by PSE&G with the only change being a line item on their utility bills where the selected energy company’s name would be. In the best case scenario, residents would be notified on the details of the arrangement and there would be an initial 30-day opt-out period sometime in the fall before the program would start. The remaining customers would be enrolled by the supplier and the service would start near the end of December.