Residents and small businesses in Vernon Hills and six other communities soon will get a new power provider, although the savings through the electrical aggregation program won't be as great.
A consortium of towns, including Arlington Heights, Buffalo Grove, Lincolnshire, Long Grove, Palatine and Wheeling, on Wednesday signed a three-year pact with a new power provider as an alternative to ComEd.
The action means Constellation Energy Resources LLC, a unit of Chicago-based Exelon Corporation, will replace Integrys Energy Group as the power source.
The group also opted for the Northern Illinois Municipal Electric Cooperative, which represents about 130 municipalities, as its new consultant as the initial two-year electric aggregation program winds down. The new arrangement takes effect in mid-May.
"What we believe is, based on our bids, they'll be hard-pressed to find anything better and if they do, residents have the ability to opt out," Vernon Hills Village Manager John Kalmar said. That can happen anytime during the three-year period and there is no termination fee, he added.
Residents and small businesses soon will receive information from Constellation regarding the change.
The communities banded together in April 2012 as part of a wave of entities to join the electrical aggregation movement and seek bids for lower-cost power. ComEd, which distributes the power, would continue to send the bills.
Kalmar said the new price will be 6.621 cents per kilowatt hour. That compares to the current rate of 5.57 cents per kilowatt hour, an increase of nearly 19 percent. As it did last time, Vernon Hills opted to purchase 100 percent green power.
Participants, representing about 90 percent of eligible residents and businesses in Vernon Hills, saved about $1.9 million over ComEd rates the past two years.
There are about 600 aggregation programs in northern Illinois, according to David Hoover, NIMEC executive director, and the majority are due for renewal in the next three months.
ComEd has come closer to the market price, dropping to about 5.5 cents per kilowatt last year after shedding more expensive long-term contracts, Hoover said.
"They came to the party. Those days of 40 percent savings or 30 percent savings, as much as we liked helping residents achieve, those days are gone," he said.
In 2012, the savings was about 35 percent. That dropped to 25 percent last year, according to Hoover. "Now, we're looking at single-digit savings," he said.
ComEd will reset its rates June 1, and can do so again this fall. The price is expected to increase to 7 cents or more per kilowatt hour, according to Kalmar.
"We felt that by going out to bid, we could lock in a better price," he said.
Hoover said the new aggregation programs offer consumers more flexibility. However, if a customer returns to ComEd, they must stay for 12 months.
During discussion of the pending change Tuesday, Vernon Hills Trustee Jim Schultz said the village has secured the lowest rate and cautioned residents to be wary of pitches.
"You do not have to enter into an agreement with someone else," he said. "Please don't be scared into signing up," with another provider.