The energy supply prices for residents enrolled in Lexington’s Community Choice Program will increase when a new, 36-month contract with First Point Power takes effect in December.
- 100% Green option: the price changes from 10.80 cents per kilowatt-hour (kWh) to 13.998 cents/kWh. This option includes 100% renewable electricity from a mix of renewable sources (e.g., wind and solar) both within and outside of New England. Most residents are enrolled in this option.
- New England Green option: the price changes from 13.219 cents/kWh to 15.654 cents per kWh. This option includes 100% renewable electricity from new renewable projects in our region.
- Basic option: the price changes from 9.935 cents/kWh to 13.081 cents/kWh. This option includes no additional renewable electricity above the state minimum requirement.
Active Lexington participants do not have to anything: they will be automatically enrolled at the new price for their current program option in late December, unless they opt out or change to a different option. The new program price will first appear on Eversource electric bills in early February 2024, and the electricity supplier will be listed as “First Point Power – Lexington CCA.”
At first glance the price increases are significant. However, the electricity market in New England has changed since the previous contract with Constellation NewEnergy was signed in 2020. The new contract and higher prices reflect current power and energy commodity market conditions. Some residents have asked why the current contract could not be “rolled-over.” Unfortunately, the current contract price was only guaranteed through December 2023. The Town was required to go out to bid to enter into a new contract for this program.
Remember that your total electric bill has two components: the Electricity Supply charge through the Town’s program plus the Electricity Delivery charge for Eversource’s distribution, transmission, outage restoration, and customer services. My total monthly bill will go up about 12% or $25 with the higher Electricity Supply charges.
The new contract’s prices are fixed for the next 36 months, continuing to provide long-term price stability for residents. Research on residential energy users has consistently shown over the years that customers prefer price stability over prices that change frequently. Similarly, most homeowners still opt for fixed-rate mortgages.
Residents can consider options besides the Town’s program. Eversource has proposed a new Basic Service rate of 17.25 cents per kWh for the period January-July 2024, which is higher than all three options under the Town’s program and only fixed for 6 months. Residents can also choose a competitive supplier. The most recent listing of 30+ electricity supply offers for Lexington includes only one 100% green offer with a fixed price for 36 months, at a price which is 20% higher that Lexington’s new program.
Lexington’s Community Choice Program is significant: residents and businesses will pay about $20 million annually for electricity supply. The procurement process was led by Lexington’s program consultant, Peregrine, which recommended timing for going out to bid earlier in 2023. Peregrine solicited bids for the Town and provided initial indicative pricing from 3 bidders. This indicative pricing was then brought to the Select Board, which granted the Town Manager permission to sign a contract based on final bid prices. Cost, percentage of renewable energy supplied, length of contract, and reputation of the supplier were all considered. First Point Power, who was selected, offered the lowest rate for a 36-month contract.
Based in Rhode Island, First Point Power is an electricity provider for Community Choice Programs and businesses across New England. “The team at First Point Power is proud to support Lexington’s commitment to sustainability and price stability through community choice,” said Bryan Amaral, Vice President of Operations.
Maggie Peard, Lexington’s Sustainability and Resilience Officer, added, “Lexington’s Community Choice Program has a track record of providing measurable value to the community, including providing price protection during last winter’s volatile electricity market. To date, Lexington’s Community Choice Program has saved participants more than $25 million since the program’s launch in 2017. In addition, through the program, participants in the 100% Green and New England Green options buy more electricity generated from renewable sources than is required by law. Their participation has helped the community to avoid more than 500 million pounds of CO2 emissions. This is equivalent to the emissions associated with more than 50,469 gasoline-powered passenger vehicles for a year.”
Leave a comment