In Your Opinion: Vote ‘Yes’ For Energy Aggregation

By Ted Chase.

What will most perplex township voters on Nov. 8 is the Municipal Public Question.  This concerns what is called Community Energy Aggregation.

We (Franklin Township) get our electricity from PSE&G.  But there are two parts to this: the actual electricity generated, by whatever means, and the delivery of the electricity, by power lines along the streets.  While PSE&G will always be the deliverer of our electricity (unless we go entirely to solar cells on the roof, with battery storage), we can buy the electricity from another firm.  What is proposed (a group of citizens petitioned for this) is to bundle everyone in the township as buyers from some other electricity generator. This, we hope, will get some other producer to offer a lower rate, and save everyone money.  (Any user can, however, opt out, choosing to continue to buy their electricity from PSE&G.)  We hire an intermediary to prepare specifications, solicit and receive bids from generators.  The intermediary is paid by the winning generator, not the township.  Users will receive a single bill, though the production and delivery parts will be stated separately, and pay PSE&G, who will send the production part on to the generator.

        Council, in agreeing to put this on the ballot, made several specifications: 1) the generator must offer a saving of at least 5 percent compared to PSE&G’s price; 2) they must generate a fraction of the electricity by renewable means, i.e. solar or wind, a fraction at least 10 percent more than the state now requires of all generators, currently 22 percent; 3) the generator must also offer electricity produced 100 percent by renewable means, though at a higher price.  This is for people whose commitment to lowering global warming is great enough that they will willingly pay more for electricity produced entirely by renewable means.

        Thus a generator must feel confident that they can meet these terms and still make money.  It is possible that no generator will feel confident, and no one will bid.  It is also possible that several will bid, and may offer savings greater than 5 percent.  The contracts offered are generally fairly short term, 18 months to two years, after which there would be new bidding; but they are binding contracts, the rate cannot be raised during the contract period.  This is contrasted with buying individually from companies offering 100% renewable electricity, who may raise their rate at any time after an initial short period.

       Such a contract thus would offer dollar savings – if only 5 percent – and reduction of the use of fossil fuel in producing electricity.  About half the electricity produced commercially in New Jersey is generated by burning natural gas, and half by nuclear power plants, which though not producing carbon dioxide are not considered renewable.  The producer however may be outside New Jersey, sending their electricity through the Pennsylvania – Jersey – Maryland (PJM) grid, which is actually wider than just these states, and includes production by wind and burning coal; about 11 percent of its electricity is produced renewably.  Obviously one cannot identity the producer of an individual electron, but it is known how much renewably produced is put into the grid.

       I therefore recommend voting for this ballot question.  (Energy aggregation was considered some years ago, when I was on Council, but not enough councilpeople were then convinced that it was a good idea.  Now, they are convinced.)

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