MOUNT VERNON — Although Knox County as a whole rejected electric aggregation, individual villages and townships still can help their residents save money on electric bills.
In 2021 and 2023, residents in the unincorporated areas of the county turned down countywide electric aggregation.
Aggregation uses group buying power to spur competition among energy suppliers, thus lowering residents’ rates.
The Knox County Board of Commissioners placed its buildings in an electric aggregation program in 2012 through the County Commissioners Association of Ohio (CCAO).
Mount Vernon and Fredericktown have taken advantage of aggregation’s bulk purchasing power and negotiated lower rates for their residents.
Both municipalities participate in group buying through the Ohio Municipal League’s (OML) energy program.
Palmer Energy serves as a consultant for the OML and CCAO. Bob Snavely is Palmer’s representative to the county, city, and village.
Because Mount Vernon and Fredericktown’s contracts renewed at the same time, they combined into a larger consumer pool in September and secured a lower rate than if they had negotiated separately.
“But the big picture concept that we would like to accomplish is to bring in more of the villages and the different townships, where the numbers make sense,” Snavely told the county commissioners on Tuesday.
“Mount Vernon and Fredericktown are basically leveraged together, but if Danville or Centerburg came on, then the next time, everybody would potentially save more money.”
“Since we have areas that obviously didn’t want it, we could pick up those townships, the villages, and at least make a bigger aggregation program for those people that do want it.”
knox County Administrator Jason Booth
How does it work?
First, each municipality would place electric aggregation on its ballot. If it passes, they would become an aggregator.
Second, the county must obtain certification as an aggregator through the Public Utilities Commission of Ohio.
Third, the municipalities would cede authority for their aggregation program to the county and come under its umbrella.
American Electric Power serves 100% of households (about 9,701) in Fredericktown, Mount Vernon, Centerburg, Danville, Gambier, Gann, and Martinsburg.
The company also serves 80% or more of households in Clinton, College, Hilliar, and Liberty townships (roughly 3,345 households). Together, the jurisdictions represent a buying pool of more than 13,000 households.
While other townships can put aggregation on their ballot, Snavely said, “these are the ones by the numbers that we think make the most sense.”
[Together], those make for good possibility of passage when you talk about putting it on the ballot,” he said. “Creating a larger group underneath the county umbrella will create larger purchasing power and better pricing, essentially, for all those involved.”
Ceding authority to the county
Fredericktown and Mount Vernon are state-certified aggregators.
Snavely said they like the idea of coming under the county’s umbrella.
“What they would do procedurally is cede authority to the county so that the commissioners would be the aggregators of Fredericktown and Mount Vernon right now, and then whoever decides to jump on board going forward,” he said.
“This is how we do it in most of the counties in Ohio.”
For example, Newark cedes authority to Licking County. Zanesville cedes authority to Muskingum County. A countywide ballot initiative failed several times in Licking County.
“Zanesville and Newark are decent-sized cities. They’re not Cleveland or anything like that, but they’ve ceded authority and there’s never been really any issue with that,” Snavely said.
“In Licking, I think we have virtually all the villages and cities in the program. In Muskingham, not as many, but we are looking to obviously grow that. So we’ve seen a lot of success with that.”
Snavely said that although Palmer leveraged Mount Vernon and Fredericktown into a single buying block for their recent contracts, it is much easier for them to cede authority and have everyone on a single contract.
He noted that is especially true if the plan is to grow the program. Ceding authority eliminates the need for multiple entities to sign a contract on the same day, which can be cumbersome and lead to mistakes.
Minimal lift for the county
Snavely will visit villages and townships to explain the group-buying program.
Palmer Energy will file the PUCO paperwork for certification and handle the RFPs (Requests for Proposals) when negotiating contracts.
“It’s not a whole lot of lifting on the county’s part, which is important,” County Administrator Jason Booth said.
“I think the key is, even if nobody else wanted to ballotize this, by the commissioners doing this, we can let Fredericktown and Mount Vernon join together.”
While the commissioners will sign off on behalf of all parties, Snavely encourages other municipalities to participate.
“Some villages always send either the mayor or somebody on council to come and go over everything and be part of the meeting. We encourage that,” Snavely said. “Most don’t.”
Palmer Energy’s group-buying program is opt-in, meaning households are automatically enrolled. However, they can opt out and choose another supplier.
“They can opt out at any time, or opt in at any time for no fee,” Snavely said. “That’s pretty much standard for any of the aggregations that we do.”
Commissioner Drenda Keesee said, “So the gain is better negotiated prices for their electric, and really the negative side is not there because [homeowners] can go in and out as they desire.”
