The City of Kent participates in the NOPEC energy supply contract so residents in Kent can benefit from the lower pricing that come from buying gas and electric “in bulk” with the other cities in northeast Ohio.
NOPEC’s Executive Director sent around a letter to all NOPEC participating communities last week announcing NOPEC’s new “give back” program.
The Executive Director reports that NOPEC has been working on devising a “customer give back” program as compensation for the sudden termination of the First Energy contract with NOPEC last year. The Director provides some background on the give-back options but it appears that they’ve settled on a 4 month reduced rate period for NOPEC customers from February 2018 through May 2018.
It looks like the average residential customer will save around $18 from this rate reduction. It’s not a lot of money but I’m sure Kent’s customers will take whatever they can get.
The Director notes that NOPEC customers will soon be receiving postcards notifying them of the reduced rate period so if you get one of those cards, here’s what it’s all about.
Dear Community Leader,
Each November, General Assembly members from over 200 Ohio communities come together at the NOPEC Annual Meeting to approve NOPEC’s operating budget for the coming year and elect directors. You are receiving this email because you attended, or are eligible to have attended, the 2017 General Assembly meeting held November 14, 2017.
At that meeting, NOPEC proposed a Customer Give Back program to return $9 million ($5.4 million in settlement dollars plus $3.6 million in NOPEC marketing dollars) to the nearly 500,000 NOPEC electric customers in FirstEnergy territory via a $20 Visa gift card in the mail. This money represents a good portion of the benefit NOPEC customers would have received had FirstEnergy Solutions not suddenly terminated its contract with NOPEC in 2016. However, a few General Assembly members expressed concerns about the administrative expenses and fulfillment logistics associated with the proposed Customer Give Back program during the meeting. As a result, the General Assembly asked the Board of Directors to revisit the proposed program to see if there were any opportunities to revise the program to address the issues which had been raised.
Staff heard your concerns and worked to identify additional alternatives to distribute the $9 million give back. Attempts to work with the utility company to administer the refund as an on-bill credit were unsuccessful. After reviewing several alternatives and the costs associated with each, the NOPEC and NextEra teams identified a solution to get this money to our customers efficiently while significantly reducing the associated administrative costs. Through our partnership with NextEra Energy Services Ohio, LLC, we are able to offer a reduced rate to our electric customers for a 4-month period this Spring.
Here’s how the newly-devised program will work: NOPEC’s electric customers will receive a reduced rate on the generation portion of their electric bills. On average, we’re reducing our rates by nearly $18 for residential customers and about $39 for small business accounts over the program period. Customers that qualify to receive the discounted electric rate will receive a post card in the mail in mid-March to notify them of the discounted pricing program. NOPEC will also create awareness of this program via a three-week media campaign in mid-March when customers will be receiving their electric bills reflecting the price reduction. There is nothing that needs to be done by any customer in order for them to receive NOPEC’s giveback.
This new give back program:
• Will lower rates for customers for 4 billing cycles (Feb. – May)
• Gives residential customers about $18 back on average over that period
• Gives small business customers about $39 back on average over that period
• Equals about a 3% overall reduction to the generation portion of their bill
• Costs about $250,000 to administer with $100,000 being contributed by NextEra
• Was unanimously approved by the NOPEC Board in January
We’re excited about all the benefits customers will receive from the program. But while we have found an unexpected and non-traditional methodology for implementing this customer give back program, this change in process will not deliver the customer intelligence and resulting competitive advantage that the original program had been designed to deliver. We will continue to seek out such data-gathering opportunities and hope to present options to you at a future General Assembly meeting.
NOPEC is a member-directed council of governments. The staff and I look forward each and every day to fulfilling our primary mission which is to serve our communities and our customers. Thank you so very much for your involvement and your voice in all things NOPEC. It is an honor, indeed, to serve you.
If you have any questions on this program, as always, feel free to reach out to me directly at any time.
NOPEC Executive Director