The Basics of Governmental Aggregation

What is aggregation?

Aggregation is an option under Ohio law to purchase electricity and/or natural gas for members of a buying group. Buying energy in bulk can give communities leverage to negotiate better rates and potentially reduce administrative costs. The utility continues to deliver electricity or natural gas to the residents’ homes, but the price of the energy supplied is negotiated by the aggregator.

Governmental aggregations

Local governments may arrange to purchase electricity or natural gas for their residents as “governmental aggregators.” They can aggregate on their own or jointly with other local governments. Ohio law gives local governments the option to choose either an opt-in or opt-out form of aggregation.

• Opt-in — Each resident needs to provide consent to participate.
• Opt-out — Residents are automatically enrolled unless they individually opt-out of the program. This method requires voter approval and is the most common form of aggregation.

Local government requirements

Local governments must be certified by the Public Utilities Commission of Ohio (PUCO) before beginning an aggregation program. They must adopt an ordinance or resolution approving the specific aggregation method (opt-in or opt-out). Opt-out programs must be placed on the ballot and approved by a majority vote.

If the opt-out ballot issue is approved, the local government must develop a plan for its authorized program. Before adopting the plan, a minimum of two public hearings must be held. The local government must decide whether to provide energy supply services directly or through another supplier or broker. Then, a notice must be sent to each resident explaining the services to be provided, the rates, other fees or charges, early termination charges, and any other service terms and conditions. The notice must also explain the opt-out procedure.

For opt-in aggregation, local governments must first negotiate the rate and terms and conditions with a supplier or purchase energy themselves. Two public hearings must be held, and the plan must be certified by the PUCO. Next, the aggregator notifies consumers within the aggregated area about the offer and enrollment method so they can decide if they want to join the program.

To find out if your local government provides energy aggregation, check locally or see the PUCO’s aggregation map application at https://bit.ly/puco-aggregation-map. Alternatively, consumers can call the PUCO (800) 686-7826 or contact their local government.

Consumer eligibility

Only residential consumers served by a PUCO-regulated utility can participate in government aggregation programs. Percentage of Income Payment Program (PIPP Plus) participants are not eligible. Consumers who have chosen an alternative supplier are eligible but not automatically included and should contact their local government if interested.

The aggregation decision

When reviewing an opt-out notice, consumers need to decide if they want to stay with their utility’s standard offer for their natural gas or electricity supply or join governmental aggregation.

Consumers should always open ANY mail from aggregation groups and local governments. Consumers should respond promptly to avoid being automatically enrolled with the aggregated group, generally within 14-21 days of receipt of a notice with directions on how to opt out. Consumers who want to participate simply do nothing.

Consumers have another chance to opt out of enrollment when the utility sends the required notice prior to switching their energy supply to the aggregator. Consumers have seven days from the enrollment notice’s postmark to contact the utility to rescind without penalty. However, aggregation offers often do not have a termination fee and may allow customers to leave the program at any time.

New and existing residents served by an alternative supplier wishing to join the aggregation program should contact the local government aggregator to see if they can join. Before joining, they should find out if there are any early termination fees for ending a contract with their current supplier.

The Office of the Ohio Consumers’ Counsel’s (OCC’s) How to Make Wise Energy Choices fact sheet can help consumers decide between the standard offer, a marketer offer, or an aggregation.

Electric Do Not Aggregate list

Customers may opt-out of receiving governmental electric aggregation offers by contacting the PUCO at 1-800-686-7826 or completing the Electric Do Not Aggregate Form on the PUCO’s website. Please note, these customers’ names and service addresses will be made available publicly on the PUCO website.

For more information or assistance with education about aggregation, visit the OCC website at www.occ.ohio.gov or the PUCO website at www.puco.ohio.gov.