NHARPC CORNER: Helping Municipalities Meet Their Energy Goals
The information contained in this article is not intended as legal advice and may no longer be accurate due to changes in the law. Consult NHMA's legal services or your municipal attorney.
Recognizing that New Hampshire is one of the most expensive electricity markets in the nation and has significant dependency on electricity generation out-of-State, several regional planning commissions have become more involved in energy planning to help municipalities and their constituencies save on energy costs and address other municipal energy goals. The two main approaches for assisting communities have consisted of organizing and administering Municipal Electricity Supply Aggregation programs and assisting communities in taking advantage of the State’s Community Power Aggregation law.
Municipal Electricity Supply Aggregation and Community Power Aggregation are ways that local governments, such as municipalities and counties, can use economies of scale to better negotiate the terms of the energy supply they are purchasing. You can think of them as buying clubs for electricity. While the two concepts have these similarities there are also differences between the two, including who constitute the members of the buying club. Over time, legislation in New Hampshire has expanded the definition of who can benefit from electric aggregation.
Municipal Electricity Supply Aggregation
With Municipal Electricity Supply Aggregation, the buying club members are large public sector consumers like municipalities, counties and school districts. Typically, the main goal of the members is to purchase electricity as a group from a competitive supplier at a lower rate than each member could receive on its own. By purchasing as an aggregation, municipalities, counties and school districts can offer electricity suppliers a larger demand than if they each tried to purchase electricity individually. The larger demand, in turn, allows suppliers to offer a better rate to the aggregation than they could to individual members. The aggregation also makes it possible for members to share the costs of documenting load data, organizing a RFP process, selecting a supplier, conducting negotiations, and managing energy contracts.
Municipalities do not need to make capital or other investments in order to switch to a competitive electricity supplier; it is entirely a paper transaction. Aggregation participants continue to be billed through their default distributor (Eversource, Until, etc.) and receive a single bill for supply and distribution charges. Moreover, aggregation members continue to receive the same level of electricity delivery, emergency response, and meter reading from their current utility.
Partnering with Regional Planning Commissions
Regional planning commissions can serve as an aggregator to facilitate a bid process among competitive electricity suppliers licensed with the NH Public Utilities Commission. Each aggregation member signs its own contract with the supplier for a fixed electricity supply rate. Rates and contracts are identical for each member within a given electric distribution territory.
In 2011, the Nashua Regional Planning Commission utilized funding from the Energy Technical Assistance and Planning program to work with 9 towns and 6 school districts to form an aggregation to procure electricity from a competitive supplier. The program proved to be incredibly successful, saving its members a total of $1,608,931 from 2012 through 2017. In 2019, Rockingham Planning Commission (RPC) launched its own municipal electricity supply aggregation program. Members of the RPC aggregation include Epping School District, Town of Hampton Falls, Plaistow Public Library, Town of Stratham, Town of Newton, Hampton Falls Free Library, Town of Kingston, and Kingston Community Library. The aggregation’s current contract runs from November 2019 through October 2022. Lakes Region Planning Commission has also offered electricity supply aggregation services to its members.
Community Power Aggregation
Community Power Aggregation, recently enabled by NH RSA 53-E, expands who can be part of the electricity buyer’s club, allowing for residents and businesses to join under the umbrella of a municipality’s electricity aggregation efforts. With Community Power Aggregation, municipalities work in collaboration with experienced service providers who know the electricity market so municipal staff do not need expertise in the energy sector. While municipalities with Community Power programs purchase electricity on the wholesale market, they do not own or maintain the poles and wires. Like Municipal Electricity Supply Aggregation, repairs, power outages, and routine upgrades are taken care of by the utilities.
Similar to Municipal Electricity Supply Aggregation, a main benefit of Community Power Aggregation is that a municipality can increase energy savings. However, it also enables local governments to make electricity cheaper for residents and small businesses. It can also help communities be more purposeful in their negotiations with suppliers to access more renewable energy or source more electricity locally. Finally, municipalities have the flexibility to develop their own creative programming such as offering variable time-of-use rates, supporting the development of solar, building local battery storage capacity, developing low and moderate income energy efficiency programs, or developing public use electric vehicle charging infrastructure.
Unlike Municipal Electricity Supply Aggregation, Community Power Aggregation is a more involved process and much of it involves planning. Key action steps associated with launching Community Power in a community are the following:
- The municipal governing body appoints a Community Power Committee
- The Committee researches Community Power plans and service providers
- The Committee develops a Community Power Plan, with input from the community.
- The Committee holds public hearings to educate the town about the Community Power Plan and get residents’ feedback.
- Residents vote to approve the Plan at Town Meeting.
- The Town or City sends an announcement to residents that they will be enrolled in the new Community Power Plan and provides them an opportunity to opt-out of the program.
- The Town or City signs a Community Power contract with a service provider and, together, they launch the program.
Community Power Examples
Much of the Community Power movement in New Hampshire has started in the Upper Valley with the City of Lebanon taking the lead followed closely by the Town of Hanover working with the Public Utilities Commission and the Legislature to allow the concept of Community Power in New Hampshire.
The approach that Lebanon and Hanover used to bring Community Power to their communities was to start by forming volunteer committees to help guide the way. Lebanon’s Municipal Aggregation Subcommittee of the Lebanon Energy Advisory Committee spent over a year researching aggregation and developing a strategy to bring Community Power to the City. The next step was to write an electric aggregation plan to provide guidance to the program goals, how community power will work, guidance on implementation, and compliance with state statutes.
The Upper Valley Lake Sunapee Regional Planning Commission (UVLSRPC) assisted with the public outreach on the plan and the presentation of the plan and Community Power concept to City officials. UVLSRPC will continue to support its communities that are interested in electric aggregation through networking support, plan development, meeting facilitation, and public outreach.
Community Power is gaining momentum in the Monadnock Region as well. Currently, the City of Keene and the Town of Harrisville have developed and passed Community Power Plans. These plans are now under review by the New Hampshire Public Utilities Commission, which is the regulatory body that oversees Community Power implementation. Several other communities including Walpole, Peterborough, Swanzey, Dublin, Hinsdale, Nelson and Cheshire County are at various stages of forming committees, conducting research, or developing plans. Some municipalities have already started working with service providers to receive technical assistance with their projects.
Southwest Region Planning Commission (SWRPC) has been partnering with a regional non-profit, the Monadnock Sustainability Hub (MSH), to share information about Community Power in the Monadnock Region. Although still in its nascent stages, the partnership is looking to couple MSH’s expertise in Community Power with SWRPC’s relationships with municipalities and its familiarity with local planning initiatives to help share information about community power as a strategy to meet community goals. The partnership is leading to several collaborations including the development of materials that municipalities can use to educate their residents and elected officials about Community Power, an update to the MSH webpage on Community Power, the scheduling of additional information sessions about Community Power, and planning for a municipal peer support group to share information and best practices.
Municipalities that are interested in learning more about electricity supply aggregation or Community Power should contact their regional planning commission to find out what opportunities are currently available. Rockingham Planning Commission staff have been involved in municipal electricity supply aggregation since its inception in 2011 and are available to help communities across the state that are interested in forming regional aggregations.
Tim Roache, Executive Director, Rockingham Planning Commission, can be reached at firstname.lastname@example.org or via phone at 603.658.0518; Meghan Butts, Executive Director, Upper Valley Lake Sunapee Region Planning Commission, can be reached at email@example.com or via phone at 603.448.1680; and J. B. Mack, Principal Planner, Southwest Region Planning Commission, can be reached at firstname.lastname@example.org or via phone at 603.357.0557.