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Palos Hills gets charge out of being charged less for electricity

  • Written by Kelly White

  City of Palos Hills officials say they not only provide their residents with one of the lowest property tax rates in the Cook County area but for the past year they have been saving their residents big bucks on their monthly electric bills as well.

  In March 2012, voters in the city of Palos Hills approved a referendum allowing the community to contract with an energy supplier to reduce electricity costs for its residents. Northern Illinois Electrical Collaborative representative, Larry Shover, negotiated electric prices between energy suppliers and received bids from that he then submitted to Mayor Jerry Bennett and the Palos Hills City Council, and upon agreement, the city of Palos Hills chose First Energy Solutions Corporation as their supplier of choice for their municipal aggregation program.
  Residents who participated in the City of Palos Hills Electric Aggregation Savings Program have enjoyed savings on their ComEd bills since the program’s inception in the summer of 2012. Residential and small commercial accounts received a fixed rate of 4.74 cents per kilowatt hour for a two-year term with FirstEnergy. The ComEd rate adjusts monthly for residents who have chosen not to opt into the contract with FirstEnergy, and as of November 2013, ComEd’s rate stood at 6.005 cents per kWh (a 21 percent reduction).
  “Even with the ComEd rates changing and lowering, we are still saving a significant amount of money,” Shover said at last Thursday’s City Council Meeting. “And, the good thing about FirstEnergy is the rates do not change. Our residents are locked into the 4.74 rate until the summer of 2014.”
  In the program’s first 13 months, participating Palos Hills households saved on average, $213 in electric supply costs; a cumulative city-wide savings of almost $1.3 million.
  “The Palos Hills City Council selected a 24-month term with FirstEnergy at what was a very opportune time in the electric market, and prices have since climbed,” Shover said.
  Almost 7,000 Palos Hills residents have chosen to opt in to the electrical aggregation program whereas 220 residents have decided to opt out and stay with ComEd.
  “New residents are not automatically enrolled in the program as they are similar electric aggregation programs in other surrounding towns,” Shover said. “But, all are welcome to join in at any time.”
  These residents must contact FirstEnergy, and give their ComEd account number, service address and specifically request the Palos Hills fixed rate of 4.74 cents. There is no fee to join or to leave the program. Those enrolled with other suppliers should first check with their current supplier to determine if they are subject to any early termination fee before joining FirstEnergy.
  Public Works Commissioner, Dave Weakley, said more than 700 new Palos Hills residents were contacted about joining FirstEnergy over the past couple of months. “The residents that did join the program have reported to be very happy with the savings,” he said.
  City Council members are contemplating the idea of adding a memo to resident’s monthly water bill informing them of the option to switch over to FirstEnergy if they haven’t already or if they are a new resident.
  The ComEd rate is expected to rise in June 2014 from the current 6.005 cents per kWh due to known increased capacity charges, which are included in the ComEd supply rate. Meanwhile, Palos Hills program’s rate will remain fixed at 4.74 through July 2014. Those increased capacity charges will not be passed through to Palos Hills aggregation program participants. At the end of the two-year term, the city may again seek competitive rates to renew the program.
  “We will have a much better picture around March or April for rates,” Shover stated.
  “We are very pleased with our rate and I’ve spoken to residents and they are also very happy with the savings acquired with FirstEnergy,” Bennett said.
  Residents continue to receive one monthly bill generated from ComEd and continue to receive delivery services from ComEd. Any outages are also reported to ComEd.