A thorough review of energy purchasing can reduce costs

Electricity can account for nearly 10 percent of a community’s budget, so it’s a good idea to take steps to evaluate your electricity supply situation.

The Uniform Procurement Act (Ch. 30B) allows flexibility for energy procurement. Massachusetts municipalities are able to contract with a competitive energy supplier and forgo the request-for-proposals process. This allows communities to seek out competitive electricity suppliers, to monitor the electrical market, and to design a strategic energy management program.

In order to take advantage of this exemption, communities need to submit a copy of the contract, along with a brief write-up describing the process used to execute the contract, to the Department of Public Utilities, Division of Energy Resources, and the Office of the Inspector General within 15 days of the execution of the contract.

The following are some important points to cover in evaluating a municipal energy supply process:

Electricity supply contracts
• Do you have an energy contract in place? If so, when does the electricity contract expire? Which utility or supplier do you use?

• Does your energy contract include all public uses of electricity in your community, including schools?

• For what time period do you want to secure your electricity budget for the future? (The MunEnergy program allows you to lock in a price for several years, even as market prices continue to fluctuate.)

• Review your current utility supply rates by zone and make sure to include any additional federally mandated costs, such as capacity, locational forward reserves (LFR), congestion, and reliability must run (RMR). Keep in mind that utility basic service rates change every three months for larger customers and every six months for smaller ones.

• Talk to other local officials who are currently enrolled in energy contracts.

Compile information
• Compile your most recent electricity bills for all electric accounts. Don’t forget to include smaller accounts, such as streetlights.

• Make sure to include public school accounts for pricing. You may want to discuss the public schools’ energy strategy to avoid any conflicts or switching fees.

Renewable energy, load response, or energy efficiency goals
• Evaluate your municipality’s green initiatives. If your municipality has renewable energy goals, you may want to consider an additional quote that includes renewable energy certificates as part of your price. A renewable energy purchase may qualify for use in the U.S. EPA’s Green Power Partnership, Climate Leaders Program, or as points towards LEED certification.

• Research solar energy incentives in Massachusetts. For information about the state’s incentives for solar installations, visit www.commonwealthsolar.org.

• Consider demand response options. If your municipality can temporarily reduce electricity usage during an emergency event by at least 100 kW, by curtailing electric loads or operating on-site generators, then you may be eligible to enroll in a load response program and receive financial incentives to act as an alternative to generation.

• Assess the existing energy infrastructure in your municipal buildings and consider upgrades to lighting, controls and/or HVAC, system retrofits, or new construction. These measures can be implemented through energy-saving performance contracts that finance projects through guaranteed savings.

Contract execution and billing
• Review your electricity proposal, pricing model, and contract to make sure everything meets your municipality’s needs.

• Confirm the authorized signatory for signing the contract. In a town, typically the town manager or administrator signs the contract as well as the board of selectmen. In a city, the mayor signs as well as a CFO or department head.

• Submit a copy of the contract with a brief write-up describing the process used to execute the contract to Department of Public Utilities, Division of Energy Resources, and the Office of the Inspector General within 15 days of execution. If executing with Constellation NewEnergy, make sure to return the 30B Confirmation Form attached to your contract.

The MMA’s MunEnergy program offers a free service that analyzes your municipality’s account history. You must complete a simple data authorization form that allows your utility to share past electricity consumption with Constellation NewEnergy. MunEnergy can review and analyze the data to develop an energy solution that meets your requirements.

Constellation NewEnergy is the endorsed supplier to the MMA’s MunEnergy program. For more information, contact MunEnergy Program Manager Emily Neill at (617) 772-7513 or emily.neill@constellation.com.