Six Glouco towns to join in energy program

Posted: June 13, 2014

Six towns will join together under Gloucester County's guidance to seek better energy rates following the freeholders' approval of the plan Wednesday.

The county board unanimously voted to create an energy aggregation program - the first time a county has done so in the state, although a number of municipalities have established programs.

Aggregation programs take advantage of a 2003 state law that allows local governments to negotiate purchases of electricity and natural-gas energy supplies for their residents. The six towns - Clayton, Deptford, Mantua, National Park, Woodbury Heights, and Woolwich - had already passed resolutions expressing interest in joining a county program.

A spokesman for the Board of Public Utilities said the board did not track how many municipalities had implemented aggregation programs, but about 40 have filed bidding documents (some as cooperative agreements). A New Jersey League of Municipalities attorney, Ed Purcell, estimated that a dozen towns had programs in place, all for electricity.

The state law's opt-out policy allows for local governments to sign up residential and nonresidential properties if they are not already in a third-party agreement; customers then can choose to exit individually. That has been the subject of criticism by some who believe that customers should not automatically be enrolled for a new energy supplier. (In Pennsylvania, state law allows the reverse - an opt-in program.)

But proponents say leading agencies need to demonstrate a solid customer base to achieve better savings. The state prohibits a government aggregation program to sign a deal at higher than the local utility's tariff rate.

"It's impossible to go the wrong direction," said Freeholder Lyman Barnes. He said "conservative" estimates placed savings between 5 percent and 10 percent.

Invitations to join the program were extended to the county's 24 municipalities, Barnes said. He said that having six accept was "a very good starting point."

"I don't know that we had any expectations in regards to the number of them," he said.

The bidding process could unfold in the next few months. Barnes said that, depending on the auction process, a negotiated rate could take effect before winter. Contract durations could vary.

The size of the towns was a factor for some of the municipalities joining.

"We're not going to get the kind of deal we would with the county," said Mayor Harry Elton Jr. of Woodbury Heights, a one-square-mile borough with about 1,000 residential and nonresidential properties. "We're too small."

The county's program arrives as one of its towns debuts its own. Glassboro, which joined a cooperative agreement with Willingboro and Bayonne last year, was able to save 12 percent on the supply rate by buying from TriEagle Energy, said chief financial officer Karyn Paccione. This month's bill will be the first under the supplier.

"I did get a lot of calls about it," Paccione said, adding that once the program was better explained, most were open to the idea. "They just wanted to make sure it wasn't a scam."



Inquirer staff writer Clark Mindock contributed to this article.

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