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Council authorizes manager to lock in 36-month aggregation rate; Energy Harbor bid lowest at $0.0460/kWh
Summary
Council adopted RESOLUTION 2020-37 to authorize the city manager to enter an electricity aggregation agreement; Affordable Gas & Electric presented Energy Harbor's low bid of $0.0460 per kilowatt hour for a 36-month term and explained the opt-out process and supplier-funded mailings.
Franklin City Council voted unanimously on July 20 to authorize the city manager to enter into an electricity aggregation agreement under RESOLUTION 2020-37, after a presentation by Jordan Haarmann of Affordable Gas & Electric.
Haarmann described the aggregation as an opt-out bulk purchasing program approved by voters in 2000 and said the current supplier, Dynegy, is under contract at $0.0499 per kilowatt hour through May 2021. He told Council that Energy Harbor provided the lowest bid at $0.0460 per kilowatt hour for a 36-month term and recommended locking the rate given current market conditions. "This is an opt-out aggregation program," Haarmann said, adding that market prices change daily and the City Manager would be advised when staff recommends locking a rate.
Council questioned the timing of locking a rate amid volatile market conditions. Mr. Denny Centers said he was concerned that securing a fixed aggregation price now could prove disadvantageous if market retail utility prices fell below the aggregation price; Haarmann acknowledged the risk and noted there have been occasions when customers were advised to opt out when utility rates were lower than the aggregation price.
Haarmann also explained logistical support: the supplier will pay for opt-out mailers on City letterhead, residents will receive information explaining rates and terms, and Affordable Gas & Electric will field resident questions. Councilmembers discussed outreach history; Mr. Lewis said prior rounds included open forums, mailings and supplier-funded postage to inform residents of opt-out options.
Mr. Denny Centers moved to adopt the resolution; Mr. Paul Ruppert seconded. The motion carried on a unanimous recorded vote: Brent Centers, Todd Hall, Michael Aldridge, Debbie Fouts, Mathew Wilcher, Denny Centers and Paul Ruppert voted yes.
Council authorized the City Manager to proceed with the aggregation process; staff will provide opt-out notices and additional resident communications as required by the agreement and applicable procedures.
