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City Finds Cheaper Electricity Supplier

Oak Forest residents will see 43 percent savings compared with ComEd's rate, city official say. This includes the added cost to guarantee 100 percent of energy comes from renewable sources.

The City of Oak Forest has selected a new energy supplier that officials said will save 43 percent off of ComEd's power rate.

FirstEnergy Solutions was chosen from six companies that submitted bids after the City Council voted to seek a new supplier on May 8. One bid actually came in as the lowest, but couldn't promise a stipulation that it would guarantee a match ComEd's rates.

The two-year contract will with FirstEnergy includes the cost to buy energy entirely from green sources.

This added cost to secure renewable energy adds an extra 0.08 cent per kilowatt-hour, bringing the contract rate to 4.82 cents per kilowatt-hour. City officials said this is 43 percent less than rate just established by ComEd from their energy suppliers of 8.5 cents per kilowatt-hour.

On Tuesday, City Administrator Troy Ishler said the contract was a "win-win" for the city.

"It's not often we get to go back to our residents and tell them we saved a ton of money on something," Ishler said.

Residents who wish to opt out of the contract with the new dealer can do so. A letter from the city will be mailed out in early June explaining how. Oak Forest residents will have two chances to stick with the current ComEd supplier.

FirstEnergy is a subsidiary of FirstEnergy Corp, which is in Akron, OH, according to the city. It currently serves more than 1.5 million residential accounts in Illinois, Ohio, New Jersey and Pennsylvania.

Oak Forest voters approved an electrical aggregation referendum on March 20, with authorized the city to search for a new, cheaper energy supplier. A state law that took effect in 2010 allows cities and towns to aggregate the buying power of its residents and find alternatives to ComEd's energy supplier.

Residents can still expect to see bills with the ComEd name and will still call the company for service issues. ComEd maintains the services lines for a supplier.

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NANCY GRACE May 24, 2012 at 01:07 PM
Sounds great.
Richard DeVries May 24, 2012 at 02:11 PM
Sounds good to me. When does it start. How do i know I've switched
chuck toland May 24, 2012 at 03:51 PM
The plan should start in August. You do not need to do anything to be switched. If you want to opt out, you need to return one of the two letters you will receive. Every home will receive two letters, and you only need to return one of them. One will be from the city, and the other will be from FirstEnergy. You check the opt out box, and place the form in the mail. The response will go directly to FirstEnergy. Again, to be perfectly clear, ComEd will still be delivering the energy. The only thing that will change is the company who supplies the energy. ComEd also, purchases its energy from a supplier. They do not produce energy. If the ComEd rates move lower, FirstEnergy guarantees to meet or beat the rate offered by ComEd, so if that happens in the first two years, you will not pay a higher rate than ComEd customers. Since ComEd is not in the supply market, they do not care who you purchase the electricity from. Have a great Memorial Day Weekend.
Larry tobleck May 25, 2012 at 12:52 AM
On the "free", "green" energy, that will cost 8 cents more. What or how will this company be able to guarantee that it is ALL green. The electricity will still be carried over coned lines and will mix with other electric companies energy, including ConEd nuclear and coal power plants. Also there is no such thing as free or green energy. The total cost of supplying wind or solar when all the energy used to product the equipment, panels and maintence of these "free" suppliers is actually 40 to 70% more than, actually clean and green nuclear power energy. Like the presidents Solarenergy, we will be paying more than necessary to support an industry that is heavy funded by government payments to even be able to coexist with convental energy, including coal.
Michael M. May 26, 2012 at 07:53 PM
It is difficult to compare prices since ComEd has the charges broken into subsections. I thought there was supposed to be a "price to compare" section, but I don't see it.
Michael M. May 26, 2012 at 08:02 PM
How much will FirstEnergy Solutions charge for the purchased electricity adjustment? If they charge MORE for that, then it can wipe out any savings. Who does the billing, ComEd or FirstEnergy Solutions? I also assume all other rates that ComEd charges for delivery will stay at the current ComEd rate.
Mike Ziak May 28, 2012 at 04:52 AM
Chuck, I'm having a little trouble figuring out where you guys are getting these figures from. Again, I feel you guys are over inflating these numbers, like with the new sale tax figures. Ive looked all over and I cannot confirm the pricing from ComEd that you are estimating the savings from. Right now, my ComEd winter rate is 6.968 cents per Kwh and from June until Sept, it will be 7.034 Per Kwh. Looking on this website, http://www.pluginillinois.org/offers.aspx?said=1, will confirm my ComEd figure, plus you'll see what the other alternative suppliers are offering as well. So where exactly are you guys getting this "New" ComEd rate of 8.5 cents per Kwh? Plus, right now I can get a rate of 5.75 cents per Kwh for one year, so where exactly am I going to see a $370 savings from. Please explain to the class here how you guys came up with these figures. People need to know this information before making a choice.
Nick Swedberg (Editor) May 28, 2012 at 05:12 AM
@Michael—ComEd is the one who will be sending the bills to customers.
Nick Swedberg (Editor) May 28, 2012 at 05:13 AM
@Larry—Thanks for the questions. I'll do some digging on that.
chuck toland May 29, 2012 at 03:59 PM
Mike I am having a pronlem with the allowed number of characters for the response. I will try and send the response to Nick and see if he will post an informative answer from Troy regarding this. In the mean time, I will send you an email with all of your answers. As always, I encourage residents who really want the answers to call or email city hall or myself.
Tom S June 19, 2012 at 03:38 PM
There is no guarantee. Power plants close to OF are coal, natural gas, and nuclear. Since electricity follows the path of least resistance that is where the majority of OF's power will come from. Look at the letter the city just sent out to its citizens. In the environmental disclosure section (percentage of total PJM) you will see that less than 5% comes from green sources. Apparently the City of OF wants its citizens to support green power even though we will get very little of it.
chuck toland June 19, 2012 at 04:50 PM
Although the amount of "green" electricity that gets to an individual house cannot be known, what the city agreed upon will bring "more" green energy to the grid. As stated above, there is no way to guarantee what energy gets to your hosue, but the energy that Oak Forest is purchasing will be from "green" producing plants only. The overall percentage of "green" energy that moves into the grid will increase due to that. I called FirstEnergy Solutions this morning, and had them explain it to me. They will get me information on where our energy will be produced. The portion of electricity that Oak Forest purchases will be 100% green, and will be added to the grid that ComEd services. There are additional companies who contribute electricity to that line, and as in the past, whose electricity you actually get in your home cannot be determined, All we can do is make sure whatever we are contributing to the grid is 100% renewable. I hope this explains it a little better. If you have questioins, please call FirstEnergy Solutions, Troy Ishler or me. It is not as simple as buying the clean energy and piping it into your house. I guess it is up to the city to ensure through some reporting that we are contributing only green energy.
Tom S June 19, 2012 at 06:07 PM
Chuck, I just wanted to make the point that OF residents will be paying 'green' power prices for electricity (that they actually receive) which will be predominately generated by fossil/nuclear power plants. The letter that the city just sent out stated: "In addition, the electricity for the City of Oak Forest program will be 100% renewable." People reading this letter could reasonably assume that they will be receiving 100% 'green' power. In reality they will be getting very little power generated by green sources.
Michael M. June 19, 2012 at 09:08 PM
Two other noted issues. 1- The city letter says that you can stay on budget billing. But the contract, section 4 Billing states that FES does not offer budget billing. How dose that affect the budget billing? 2-The city letter states that after you receive your confirmation letter from ComEd that you are in the FES program, you will have 7 days to cancel, The FES contract states that you have 3 days to cancel, under the Right of Rescission section. Which is it? FES also states that they can pass on any additional cost that may come up, I am paraphrasing but that means the price is not fixed until 2014, it can change just like ComEds price can change. So the contract for the price really doesn't mean anything.
Mimi June 19, 2012 at 10:10 PM
FirstEnergy solutions has NO Purchase Electricity Adjustment charge. Their rate includes supply and transmission charges (but not DELIVERY charges.) ComEd rate to compare effective June 15, 2012 is 7.85c + PEA charge of 0.5c = 8.35 cents /kWh v. FirstEnergy rate of 4.82 = savings of 42 percent on supply portion of bill. So your actual total bill will drop about 30 percent -- for the same service on what is a commodity item!
Michael M. June 20, 2012 at 09:17 PM
Mimi, you are just parroting the talking points. The real issues are in the contract.
chuck toland June 21, 2012 at 10:23 PM
I just got an email regarding a scam with electric companies trying to sell cheaper rates to OF customers. Please read and beware. If you have questions, please call city hall. Dear Mr. Toland, I want to alert you and the members of our community about the scamming that a certain electrical company did. North American Power called me today saying I would have lower electricity rates and asking me for my account number and address, etc. I was thinking this was about the new agreement Oak Forest had developed and gave them too much information. I got suspicous and said that I wanted to call my city hall before I verified any more information that they were requesting. They kept pressuring me but I hung up. I did go to city hall --to the mayor's office and told them my story. They verified that indeed I had been scammed. Mr. Ishler was good enough to call the North American Power Company. After talking briefly with the representative, I was taken off their list. I am writing you to help prevent anyone else from having this experience. I found out at city hall that at least 2 other people had had been tricked by calls from North American.
Daron Sanders July 17, 2012 at 04:49 AM
North American Power is not a scam, representatives of the company are not to call customers and try to sign them up, the persons who are doing that are not following the guide lines set up by the company, North American Power is a good company who is giving large part of it's profits to charities, and is listed in Forbes magazine, please don't let a small number of bad apples spoil the whole bunch, if you like to learn more about the positive, go to this site http://www.windpowerbiz.com Thank you.

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