If you live in Lexington, you may not even realize that your electricity most likely comes from solar, wind, and other renewable energy sources. Through the town’s Community Choice Program, residents are, by default, enrolled in a 100% green energy program, which they can opt out of if they choose. Lexington residents have helped avoid emitting 488 million pounds of CO2 from fossil-fuel power plants since the program began in 2017. To put that number in context, Lexington’s emissions are estimated to be about 880 million pounds annually from all sources. Participants have saved nearly $23 million on their electric bills in the same time period. Helping to reduce CO2 emissions while saving a lot of money – it’s a win-win for residents and the environment.

Understanding Your Electric Utility Service

Electric utility service in Massachusetts is broken down into two main parts: (1) electric delivery and (2) electric supply. Eversource delivers power to your home or business — it is responsible for the “poles and wires” transmission service that gets power to Lexington and distributes it within the town. They also deal with customer service issues like outage information and restoration. You also need an electric supply to keep the lights on. Residents of the Commonwealth have the option to choose a supplier other than Eversource. This choice has its roots in the deregulation of the wholesale power generation industry in the 1990s. Massachusetts’ regulators required utilities like Eversource to divest their power plants to encourage competition among electric suppliers.

Many towns in Massachusetts, including Lexington, have elected to purchase electricity in bulk on behalf of their residents. These town-sponsored programs are called Community Choice Programs or Municipal Aggregation Programs.  Residents can participate in a municipality’s program or can opt-out, instead choosing to be supplied either by Eversource or a competitive supplier. But Community Choice programs have proven to be popular with residents. As of the spring, about 44% of all residential electric customers in Massachusetts served by utilities like Eversource and National Grid are enrolled in Community Choice Programs.   

Residents can also choose a competitive supplier that is licensed by state energy regulators to sell electricity. These types of suppliers have received mixed reviews (and we unfortunately are all targets of their annoying robo calls, emails, and junk mail). Some competitive suppliers offer discounted introductory “teaser rates” which automatically increase after a period of time, while others offer very high prices for renewable power in the hope you will be enticed to sign up.

How Community Choice Electric Supply Works in Lexington

Lexington’s Community Choice Program uses bulk purchasing power to provide cleaner electricity and stable prices to Lexington’s residents and businesses. 

Diagram showing an electricity supplier, Eversource, and the town of Lexington

Source: Town of Lexington

Participation is voluntary. Upon moving to Lexington, new Eversource account holders receive a letter from the town before they are automatically enrolled in the Community Choice Program. The letter includes information about the program and pricing, as well as information about how to “opt-out” of the program if they do not wish to participate.

“Opt-out” programs have become popular with policymakers since people are more likely to participate if they do not have to actively make a choice to do so. The Commonwealth mandated the use of an opt-out mechanism when the Community Choice Programs were created in 1997. Behavioral economists love opt-out programs because they can be used to encourage choices that benefit both individuals and society. 

The Lexington Community Choice program currently offers three pricing options through the end of 2023. 

Community choice power options

Source: Town of Lexington

Assuming they don’t opt-out, new residents are automatically enrolled in the 100% Green option at a price of 10.80 ¢/kWh, and receive 100% certified renewable electricity, mostly from solar and wind sources. Residents also have the option of opting up to New England Green or down to Lexington’s Basic option. 

When you opt up to the New England Green option, you buy all of your electricity from renewable energy projects in the New England region. This creates demand for local clean energy projects, supporting local jobs along the way. Buying local matters even when it comes to electricity. Like a farmstand, buying New England Green may cost a bit more but it helps grow the local renewable industry. If you are already enrolled in Lexington’s program, you can opt up through the Town’s website

Even Lexington’s Basic option costs substantially less than Eversource’s own Basic Service supply rate of $16.08 cents per kilowatt-hour. The town provides an online calculator to compare prices and see the greenhouse gas emissions avoided by participating in the program. Compared to Eversource’s Basic Service, a resident using an average of 750 kWh each month who is enrolled in Lexington’s 100% Green option will save about $40 per month or $240 between July and December of 2023.

How do you know if you are enrolled in Lexington’s Community Choice program? The information is on the first page of your bill. The full name of the town’s current Community Choice supplier is “Constellation NewEnergy, Inc.” Constellation NewEnergy is a subsidiary of Constellation (Nasdaq: CEG), one of the nation’s largest producers of carbon-free energy. If your supplier is listed as Constellation NewEnergy, you are enrolled. If you are not enrolled and wish to be, you can find out how to change your status here.

Results of Lexington’s Community Choice Program to Date
By many measures, Lexington’s program has been successful for residents and businesses. The opt-in program has worked: 75% of customers chose to remain in Lexington’s program, while only 12% went with Eversource’s Basic Service and 13% chose other competitive suppliers. About 93% of enrolled accounts have opted for the 100% Green option. Since it began in 2017, the program has saved Lexington’s customers nearly $23 million compared to Eversource’s Basic Service and about 488 million pounds of CO2 emissions have been avoided. 

The Future with Community Choice

Lexington’s current supply contract is up at the end of 2023. Earlier this year, the town signed a new 3-year, fixed price supply contract with First Point Power. Started in 2009 and headquartered in Rhode Island, First Point Power is a supplier of power to deregulated states within New England and is the supplier for multiple Community Choice programs in Massachusetts, including Lincoln, Nantucket, Natick, Salem, Salisbury and Southborough.  

While the current Community Choice Program offers savings when compared with Eversource’s Basic Service price, there is no guarantee of future savings. Energy prices, including electricity prices, can change frequently and are quite volatile. A number of factors including Russia’s invasion of Ukraine, global economic activity impacting demand for energy, and supply chain constraints have all impacted fossil fuel prices as well as construction costs and completion schedules for new solar and wind generation projects.  

Beginning in 2024 with the new contract, prices under the Lexington Community Choice Program will increase. For example, the price for the 100% Green option will rise from 10.80 to 13.998 cents per kilowatt-hour. However, all of the new prices under Lexington’s program will still be lower than Eversource’s current Basic Service rate. Eversource’s prices change every six months for residential and small business customers, so future Eversource prices are unknown, but Eversource has already warned customers they should expect continued market volatility and higher Basic Service costs this coming winter. Lexington’s new prices will be fixed for the next three years, insulating residents from future price volatility. 

Meeting Climate Goals through Green Energy and Electrification

Lexington is committed to getting to net zero by 2050. The town’s recently completed Climate Action & Resilience plan lays out the goals and actions needed. Making sure you are enrolled in Lexington’s Community Choice Program can help Lexington achieve its climate goals. Green energy supply and stable electric prices also support the town’s electrification initiatives, including Lexington HeatSmart, the town-wide initiative to help residents adopt clean heating and cooling technologies. Stable and low electric prices only improve the economics of converting from fossil fuels to heat pumps. 

Maggie Peard, Lexington’s Sustainability and Resilience Officer, summed up saying “the Town is pleased to be able to offer an electricity option to residents that not only protects their wallets from a volatile energy market, but also is sourced from 100% renewable electricity. One of the easiest ways Lexington residents can take climate action is to opt up to the New England Green option to create more market demand for local renewable energy projects.”

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1 Comment

  1. Unclear from this article why the contract with Constellation NewEnergy was not renewed, and what their price would have been if contract was renewed. I appreciate the price stability of the First Point Power option, but at nearly 30% more than current Constellation NewEnergy price it is reasonable to have concerns. Lack of transparency does not help this situation.

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