City reviews FAQs on electricity aggregation

[March 02, 2012]  During this week's city council meeting, Mayor Keith Snyder shared an electricity aggregation FAQ sheet. The questions and answers have been compiled by the city's aggregation consultant, Illinois Choice Community Aggregation Network.

ICCAN was recently confirmed by the Logan County Board as their consultant as well. With the county, city of Lincoln and all the other outlying communities that have a referendum on the March ballot, ICCAN is now beginning the public education phase of its work.

Snyder said the questions and answers are one of the first steps to public education. ICCAN will also conduct town hall meetings throughout the county and will work to assist voters in making informed decisions about their choices.

Below is a copy of the handout Snyder provided to the council:

(Copy)

FREQUENTLY ASKED QUESTIONS (FAQ's) ON ELECTRIC AGGREGATION

What is the referendum Question on the March 20th ballot?

"Shall the City of Lincoln have the authority to arrange for the supply of electricity for its residential and small commercial retail customers who have not opted out of such program?"

What does the referendum mean to me?

The Lincoln City Council is seeking to reduce electricity costs for residents and small businesses. To accomplish this, the City Council recently passed an ordinance in support of a referendum being placed on the March 20th, 2012 ballot asking the voters of if they support allowing the City to implement an Opt-out Electrical Aggregation program. The Council took this action based on a new state law granting municipalities the power to negotiate bulk electricity purchases from third party suppliers on behalf of its residents.

If the referendum passes, what will it provide for?

The proposed referendum will authorize the City of Lincoln to create a bulk energy purchasing program to bundle power accounts from households and small business customers. The referendum seeks to empower the City to negotiate a lower price on their behalf.

If the referendum passes, how will the City choose a new supplier?

If the referendum is approved, the City would then have to develop and adopt a Plan of Operation for the aggregation program. Two public hearings are required before the City could adopt the plan. The City would utilize a third-party energy consultant to seek bids from several energy companies. The City would implement a competitive bidding process to select a licensed alternative retail electric supplier who must be approved

by the Illinois Commerce Commission. Bid rates will be compared to Ameren's current rates and the City will only select an alternative supplier if their rates are lower than the rate offered by the current supplier, Ameren. If the City cannot identify an alternative supplier who offers a lower rate, then Lincoln would continue service through Ameren.

Will I be required to utilize the new supplier if the City selects one?

No. If the referendum passes, but you prefer not to be a part of the aggregation program, you can opt out and continue to receive electricity from Ameren. Before the City of Lincoln chooses any power supplier, all residents and small businesses will be notified by mail that they can opt out of the Program by simply sending in a postage-paid a form provided by Ameren.

Will Ameren no longer by my electric company and the City of Lincoln will become my electric

No. Ameren would still be responsible for delivering your electricity and managing the infrastructure required to transmit the electricity. Ameren would also still be responsible for responding to any service requests. Thus, if there is a power outage, you would still contact Ameren. The only thing that may change would be the supplier. In fact, your bill would still come from Ameren, and it would include services charges for the new supplier on their bill. The City of Lincoln will have nothing to do with supplying or delivering your electricity.

Why is Lincoln pursuing an Opt-Out Electrical Aggregation Program?

Many surrounding municipalities have already initiated similar programs, or are considering them on the ballot. In communities where the new program is underway, residents have seen savings of 10 to 20 percent on their Ameren bills. City officials felt that such an effort could have similar benefits for Lincoln residents and small business users.

I have been contacted by suppliers who have offered a rate reduction already. Should I consider makin2 a switch now?

Several alternative energy suppliers have been marketing their rates and service offers to residents via mail and through door-to door contact. While you certainly can enter into an agreement with any of these suppliers, residents should proceed with caution. Please note that none of these suppliers have been selected as the authorized alternative supplier for Lincoln. You should thoroughly research the rate information they provide with a credible website like www.pluginillinois.org.

In addition, you should be aware that some companies are falsely marketing themselves as Ameren or as a designated affiliate of Ameren. Also, please proceed with caution when entering into an agreement with these alternative suppliers. It has been reported that some such agreements carry severe cancellation clauses with high termination fees.

[Text from file received from the city of Lincoln; LDN]