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Remarks on green vs. brown energy by Oak Park Trustee Adam Salzman during the village board meeting on Monday, April 21:
I wanted to say a couple of words on this topic because I have spent a lot of time over the past week or so engaging with a great many of my neighbors on this issue. I think the number of people who have directly engaged the board on this issue reflects the high priority all of us place on sustainability in the village of Oak Park, and I personally am very proud of the way we've worked through this as a community together.
I think some additional context for this decision might be helpful. We are in this position today because the process the village decided to use to secure the most affordable renewable energy rate for our residents unfortunately did not yield the most competitive renewable energy rate. And that greatly concerned many of us on this board.
Tonight's discussion of our energy procurement process actually began in January. That's when our former sustainability director, K.C. Doyle, recommended we use a reverse auction to get the best, greenest energy supply contract that we could find. And the board unanimously supported that approach.
A little over two weeks ago, we got the apparent results of that auction, and we were puzzled because we had only received one bid. That bid was from Integrys, our previous electricity supplier, and it represented a steep price increase from the 2011 rate. At just over 8 cents per kilowatt hour, with ComEd due to raise its rates in June, accepting that bid would have actually resulted in a default increase of $15-20 per month. Not four dollars. Not five dollars. It would have been between four and five times that amount.
It was troublesome to many of us that we only had one response bid come back from a renewable energy marketplace that many of us know provides a wide range of options at a variety of different price points.
Simply put, to only have received a single proposal in response to our solicitation seemed very strange.
Then two weeks ago tonight, when the board showed up to vote on that single bid, our energy consultant suddenly told us — at the meeting — that the auction had been compromised because Integrys, when they entered their bid, originally placed their decimal point in the wrong place, and instead of 8 cents per kilowatt hour, their first bid was eight one-thousandths of a cent per kilowatt hour. Needless to say, no one was willing to try to compete for a lower bid after seeing that mistake. Somehow Integrys got it corrected to roughly 8 cents per kilowatt hour before it found its way into our board packet.
If you go back and watch the video recording of that meeting, which is available on the village website, you will see that both the board and the manager were pretty upset, not just at the error but also because we were informed of the error belatedly, at the meeting.
Our energy consultant, after informing us of the mistake at the meeting, then advised us, strangely in my view, that we should just go ahead and accept the Integrys bid anyway.
But there was just no way our board was going to enter into a contract on the basis of an auction that didn't actually happen. Oak Parkers were promised that auction. We contracted for it. Without a legitimate auction, we had no idea what the market could provide for us. So the only responsible thing to do was demand a re-run of the auction.
Our energy consultant told us that if we were going to actually hold the auction we'd contracted for, it had to be done by the end of the week. Otherwise, there wouldn't be enough time to give residents the opt-in/opt-out notice and everyone would be thrown back onto the ComEd plan.
So that is how we ended up with a Friday morning meeting at 7:30 a.m. We simply had no choice. It was the absolute latest we could meet to allow for 48 hours notice, while still getting in under the wire to avoid us getting kicked back onto ComEd.
So the second auction was run on Thursday and we met Friday morning to review the results.
And this time, we again received only one green response bid — from Integrys. But it still represented a significant price increase.
By this point many of us suspected, correctly as it turns out, that Integrys' second response bid of 7.9 cents per kilowatt hour was not competitive with the rates that existed in the wider renewable energy marketplace. And again, because of the impending increase in the rate that Com Ed would be charging for use of its transmission lines, the new rate would have meant an increase of $15-20 per month. Not between $4 and $5 per month as some have been saying.
So we had to make a choice. And the clock was ticking — we had to choose that morning if we wanted to avoid forfeiting the aggregation plan entirely.
So I voted, along with my colleagues in the majority, for the lowest-priced brown option, Constellation, with the explicitly expressed understanding that we would also look for a more cost-effective option to be presented as a companion green option that all Oak Parkers could easily opt into. Anyone who watches the meeting of Friday, April 11, will see that at least four trustees indicated a desire to move in that direction.
It is unfortunate that Constellation did not offer a more cost-effective green option as part of their bid. I don't know why they didn't. If they had, I suspect this board would have voted for it.
We pushed our decision as far out as we possibly could to try to get a more affordable default green option. We pushed it all the way to Friday morning, April 11 at 7:30 a.m. And the market turned up nothing except a bid from Integrys that was above market and the result of a flawed process.
So after the vote, we did what the board said we would do from the beginning, and that's work to provide Oak Parkers with a convenient, cost-effective, 100 percent renewable choice that everyone can opt into. And that is what we are doing now: providing a green option to our residents through different channels for the next year — May 2014 through May 2015. In 2015, we will be able to revisit this again.
Here is how it will work:
All Oak Park households will get a copy of a form in the mail. In the lower right-hand column in a green box there are simple and accessible instructions for how Oak Parkers can choose a 100 percent renewable energy source for their home. It's easy. All you have to do is call the number listed and tell them you want the 100 percent renewable option for 7.57 cents per kilowatt hour. That's about a third of a cent less than the low bid we got from Integrys. And in summertime in the Midwest, that extra third of a cent can add up rather quickly.
I urge everyone here tonight, everyone watching and everyone following this issue between now and May 8 to share this information with as many of your neighbors as possible, on Facebook and Twitter, hashtag #greenoakpark, and in person so that as many of us as possible sign up for the green option.
I strongly believe that if all of us — the residents, the village, and every stakeholder — can get on the same page, pulling in the same direction between now and May 8, we can turn this challenge into an opportunity to advance and build on our reputation for green municipal initiatives.
So let's seize that opportunity.