What is Aggregation?
Aggregation is when a group of customers join together to form a single, larger customer that buys energy for its members or large multi-footprint organizations. A large buying group may be able to get a better price for the group members than you can get on your own.
What is Municipal Aggregation?
Townships, cities, counties, and consortiums may come together to form the aggregated buying groups on behalf of their citizens. The governmental aggregator (broker, consultant) chooses an outside supplier for all of the citizens in its group. Aggregations can be formed to buy natural gas, electricity or both depending on your specific state.
Opt-in aggregation is a program that allows each customer to sign up individually to partake in the program. If the local government chooses Opt-in aggregation, it can proceed to develop a plan and start enrolling customers within that group. The plan must include all rates and terms for customers to consider when deciding to join.
Opt-out aggregation is a program that automatically enrolls all local residents, unless they individually opt-out of the program (elect not to be included). A number of steps are required in this form of aggregation:
- A majority of voters must authorize opt-out aggregation in an election. The issue appears on a primary or general election ballot for your consideration.
- If authorized by a majority of the vote, the local government must form a plan of operation and management. They must also hold at least two public hearings to allow customers to voice any concerns over the proposed plan.
- Once the local government has adopted the plan, each customer to be aggregated must be notified that they will be automatically enrolled in the program unless they specifically elect not to participate. This notification must also state the rates, charges, and other terms and conditions of enrollment in the program. The opt-out notice is usually a letter accompanied by a post card to be mailed back if you do not want to participate or sometimes, a phone number to call or web site to visit to opt-out.
- Natural gas aggregation customers may opt-out every two years without paying a switching fee. Electric aggregation customers may opt-out every three years without paying a switching fee.
- Switch to a supplier and your community aggregates, you should return the opt-out notice if you do not wish to be switched to the aggregations’ supplier. That is a decision for you to make. You will want to talk to your chosen supplier if you consider switching to the aggregation’s supplier to find out if there are any penalties for the early cancellation of the contract.
If you have specific questions about aggregation plans, please contact Save Wave Energy.