CUB will hold news conference on "municipal aggregation" referer - KFVS12 News & Weather Cape Girardeau, Carbondale, Poplar Bluff

CUB will hold news conference on "municipal aggregation" referendum

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MARION, IL (KFVS) -

A utility watchdog group held a news conference in Marion Tuesday to tell people in Franklin, Williamson and Jackson Counties about an important referendum.

Concerned that voters may know little or nothing about a Nov. 6 referendum, the Citizens Utility Board (CUB) held a news conference to alert Carbondale, Marion, and West Frankfort residents of a free guide on the measure, which could have a significant impact on what residents pay for electricity.

The referendum asks if a community shall "have the authority to arrange for the supply of electricity for its residential and small commercial retail customers who have not opted out of such a program."

On Nov. 6, 139 communities in Ameren territory will vote on the referenda. Residents in the 73 Ameren communities that already have launched aggregation programs are paying an average of 4.12 cents per kilowatt-hour (kWh), compared with Ameren's current supply rate of 5.467 cents per kWh in Carbondale, Marion, and West Frankfort. That's a 25 percent discount—but the window of savings may be closing.

Under a 2009 state law, municipal aggregation allows local governments to negotiate power prices with Ameren competitors on behalf of residents. If a community passes a referendum, it can automatically switch residents to a new supplier, while allowing people to opt out.

The consumer group released "CUB's Guide to Municipal Electricity Aggregation" where voters can get a clear explanation of the referendum so they can educate themselves before they enter the voting booth on Nov. 6.

Aggregation has exploded in recent years because Ameren has been locked into higher-priced contracts, according to CUB. The last of those contracts are expiring, and utility prices are expected to drop significantly in June of 2013. So while aggregation has delivered savings in the short term, it remains to be seen if it can give consumers long-term savings.

According to CUB:

  • Even if a referendum is approved, residents who don't want to participate will have two opportunities to opt out of the program.
  • Municipal aggregation participants will still be customers of Ameren, even if they switch power suppliers. While municipal aggregation means another company is supplying the electricity, the utility will continue to bill customers for delivering electricity to homes. That means customers will call the utility if there's a power outage, and they will pay delivery rate hikes that Ameren periodically requests before state regulators.
  • Short-term savings are likely, but long-term savings are not guaranteed. Utility power prices should drop significantly by June of 2013. Given that date, McDaniel said it is key that communities develop creative, robust efficiency programs as part of their energy plans, to help residents protect their savings by wasting less electricity. It also is important for residents to ask local leaders a lot of questions. CUB's center includes a checklist of questions residents should ask if a referendum passes, including: If utility rates drop, will I be able to leave the alternative supplier without paying an exit fee?

Created by the Illinois Legislature, CUB opened its doors in 1984 to represent the interests of residential and small-business utility customers. Since then, CUB has helped save consumers more than $10 billion by blocking rate hikes and securing refunds.

 For more information, call CUB's Consumer Hotline at 1-800-669-5556, or visit www.CitizensUtilityBoard.org.

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