Mount Prospect village trustees voted Tuesday to lock in a new three-year agreement for residents and businesses who take part in the village's electrical aggregation program.
But the village won't come close to the rate it received two years ago.
Trustees approved a bid from Homefield Energy at a fixed rate of 7.935 cents per kilowatt-hour for the first two years of the agreement and 7.499 for the third year. Residents will have the choice of opting into a 100 percent green energy rate of 8.072 cents for two years and 7.657 for the third.
That's a significant hike from 2012, when the village approved its first electrical aggregation contract, a two-year deal with FirstEnergy Solutions Corp., at a rate that was 4.65 cents per kilowatt-hour.
The village's electrical consultant, David Hoover of the Northern Illinois Municipal Electric Collaborative, said that while the numbers are fluid, the new rate could translate into about a 25 percent hike in the average resident's electrical bill.
Residents aren't forced to go with the aggregator. They can opt out of the village plan and go with either ComEd or an alternative provider. One of the reasons the board did not choose ComEd, despite rates similar to Homefield's, was that the utility did not provide a green energy option, officials said.
"Like any other contract, we are voting for what is placed before us," said Trustee Michael Zadel. "We haven't set these rates. We had nothing to do with these rates whatsoever.
"We are looking at the most cost-effective thing we can do for our residents and this is it."
Before agreeing on Homefield, the board was split into two factions, with Zadel and Trustee A. John Korn leaning toward Constellation Energy's one-year proposal for 7.93 cents per kilowatt -hour.
Zadel reasoned that the Constellation option would give the village a chance to see the impact of possible regulatory changes on prices after the one-year contract elapses.
Most other trustees preferred the price certainty provided by the three-year agreement with Homefield.
"I can't see rates going down," Trustee Richard Rogers said.
"I have to believe that they are going to continue to rise. That being the case, if we can tie a three-year contract, I think it would be to our benefit."
Hoover said that over the first two years of electrical aggregation, the average homeowner saved $325, while communitywide the savings has been about $4.5 million over the past year.
"We're in a new normal for now and just trying to figure out what's the best, obviously, for the residents," he added.