In a rare show of unity, the Hempstead Town Board last week unanimously approved a Community Choice Aggregation agreement that, once implemented, could cut natural gas rates by as much as 5 to 8 percent for the town’s 174,000 households currently served by National Grid, Town Supervisor Laura Gillen announced late last month.
The measure could enable households and small businesses across the county to save an estimated average of $138.80 on their annual gas bills, and the town as a whole could see an aggregate savings of between $15 million and $25 million, Gillen said in a news release.
The proposed rules governing CCAs would allow the town to negotiate a change in providers if an alternative could be shown to have charged rates of at least 5 percent less than the current provider in the previous year’s complete billing cycle. Individual homeowners could opt out of any new CCA and remain with the previous provider, according to the release.
Gillen has not specified which providers are being considered as alternatives to National Grid, whose rates have risen for the past three consecutive years and are slated to increase yet again. The utility has asked the state Public Utilities Commission for an additional 7 percent hike for the coming year.
National Grid did not respond to requests for comment by press time.
Gillen said she expected to be able to find an alternate provider as early as this winter. Ratepayers would continue to receive the same invoices and levels of service they do now, but at lower rates, and gas would be delivered through the pipeline system now in use.
“The anticipated savings will effectively equate to a free month of natural gas for every household or small business,” Gillen said.
Under the enabling legislation approved at the town’s Aug. 6 meeting, the town would negotiate power purchase agreements through competitive bidding. “By aggregating everyone’s purchasing power in the town, we effectively gain leverage and can negotiate better rates with lower costs,” Gillen said. “The town even has the power to now purchase greener and cleaner energy sources to help lower harmful greenhouse gas emissions, offering residents a way not only to save money, but to help [protect] our environment.
“We are empowering homeowners to save more of their money that would normally go to energy companies,” she added. “When residents have more money in their pockets, our communities and local economy become that much stronger.”
With passage of the measure, the Town of Hempstead has become the first town on Long Island to pool its purchasing power, and could negotiate CCAs for other services, such as electricity.
Six other states have authorized local governments to negotiate CCAs, including Massachusetts, New Jersey and Rhode Island. The agreements cover some 8.7 billion kilowatt hours of energy in those states, and cover roughly 3.3 million customers. Enabling legislation is pending in five other states, including Connecticut, Maryland and New Hampshire. It was approved by the New York State Legislature in 2014.