What “energy aggregation” is (and is not)

Locally in Mercer County, four municipalities (Lawrence Township, Ewing Township, Hopewell Township and West Windsor Township) all convened on September 18th to learn more about and discuss the pros/cons of energy aggregation at a public hearing moderated by Lawrence Township (and MercerMe contributor) Mayor Cathleen Lewis.

You may have read in the news recently about this thing called “energy aggregation.” Let’s start about what it is NOT: It is not about the pipeline.

What is it? “Energy aggregation” is the consolidation of a community’s or communities’ bargaining in order to leverage a better rate for energy production costs (electric and/or gas) for that bargaining unit through a third-party energy supplier.

Here’s again what it’s not. It isn’t a new energy distributor. If you have PSE&G, you will remain with PSE&G. If you have JCP&L (and hope for a change, no dice), you’ll still be with JCP&L.

“We are talking about the energy supplier, not distributor. The supplier will always be responsible for the service of your account,” said The Ombudsman of the New Jersey Board of Public Utilities, Gary Finger. If there is a power outage the same energy distributor would be responsible. The same company will read your meters.

“Energy aggregation is a bundle of a community or communities – supply and demand. The larger the pool, the more recognized savings,” explained Ombudsman Finger.

It also does not directly affect the municipality’s budget. It does not cost the municipality anything because all associated costs can be built into the RFP (the public bid). At best, a municipality could save some money on the power to the municipal buildings, if eligible. It was explained at the meeting that the benefit is meant for the residents.

Does it mean a “greener” energy source? Maybe. It depends. We’ll see?

The towns that are interested in proceeding will eventually need to enact an ordinance effectively opting-in the residents in the community (those not already contracted privately with third party suppliers). This will occur after much community outreach and education to allow residents to understand the benefits and ramifications, if any. And if a resident of a participating municipality does not want to participate in the program, that resident will be able to affirmatively opt-out, explained Ombudsman Finger.  Businesses would have to opt-in to participate.

The process is just getting started and no decisions have been made yet. Are you feeling energy aggregation or just energy aggravation?