Council hears update on natural-gas aggregation supplier; staff to pursue alternatives after supplier signals difficulty

Council heard an update from the city’s energy consultant about the standing natural-gas aggregation contract and next steps after the city’s current supplier informed staff it could not sustain its obligations.

Tom Nellis of Buckeye Energy explained that Eastern (the supplier) expanded quickly after winning municipal accounts, was overwhelmed by enrollment and has encountered financial and pipeline-capacity requirements it cannot meet; he said the supplier missed a threshold set by the pipeline operator and that losing a certain number of communities would allow Eastern to avoid obligating additional storage and pipeline capacity purchases. He said three communities had already dropped and Canal Fulton’s participation would make the fourth.

The consultant and staff recommended terminating the city’s agreement with Eastern and immediately requesting bids from alternative suppliers, with options for fixed-price or variable-price agreements; they noted variable offers can provide a guaranteed savings off the pipeline default price until a fixed rate is locked. Council members asked staff to try to extract compensation from Eastern for an early termination; staff said they would pursue negotiation but also stressed the need for a seamless transition to prevent customers being left on the default pipeline rate by mistake.

Council did not vote on termination at the meeting but asked staff to negotiate and to solicit bids; staff said they would work to keep the switch transparent for customers and prefer to re-lock pricing for the next winter season in the fall when supply is typically fixed.