FAIRFIELD, Ohio — Fairfield homeowners are among the more than two dozen Ohio area residents who should prepare for sticker shock when it comes to cooling their homes this summer — whether or not they participate in the city’s aggregation program.
Those enrolled in the program, which allows the local government to negotiate favorable electric supply prices for a large group of residents, will pay 9.39 cents per kilowatt of electricity beginning in June under a one-year contract signed earlier this month with Dynegy.
That compares to the 6.19 cents per kilowatt of electricity they are paying under the current contract, which expires at the end of May, said Adam Sackenheim, assistant city manager.
WATCH: How energy price hikes in Fairfield could soon affect your utility bill
Fairfield’s consultant, Rich Surace with Energy Alliances, said in his 20 years in the business he’s never seen such volatility in the market, particularly this year.
“This market has significantly risen over the last two weeks,’’ Surace explained.
He likened it to gas prices, which routinely rise or fall — sometimes from day to day.
Fairfield Councilman Tim Meyers said about 25 neighboring Ohio municipalities are seeing similar price hikes.
WCPO 9 News has inquired about receiving that list of municipality names but hasn't heard back at this time.
"This is a pure economics 101, demand versus capacity on the grid," he said. "(It's) fueled by data centers, fueled by upticks in industry, fueled by a capacity issue where power plants have been shut down."
He noted the significant increase from last month when rates quoted to Fairfield from Dynegy and Constellation ranged from 8.71 and 8.74 cents per kilowatt of electricity.
Nevertheless, Fairfield residents who stay with Dynegy in the aggregation program are still expected to save over Duke’s rate, Surace said.
In the first of two auctions, Duke’s wholesale rate this week came in at 9.317 cents per kilowatt. That will cover half the energy Duke will need.
Surace said the retail rate would end up at about 10 cents per kilowatt hour for consumers. The second auction for the other half of electricity is set for April 15.
Those who participated in the city’s electric aggregation program saved on average $151 over an eight-month period that began in April 2024 over Duke Energy’s rate.
"Good aggregation can provide good prices," said J.P. Blackwood, public affairs liaison for the Ohio Consumers' Counsel (OCC). "We're hopeful and have reason to believe that this is not a long-term phenomenon, but it's a complicated market."
Blackwood said there are three different ways to get your energy supply, and "amongst those, there (are) hundreds of choices":
- Standard offer: typically a dependable, market-based price set through a competitive auction process with many companies bidding.
- Community or government aggregation: by combining the purchasing power of a large group of individuals, an entity may negotiate favorable prices for the whole group.
- Energy marketers: consumers may individually negotiate a price with an energy marketer, who typically offers a rate discount, gift card, rebate, or cash-back incentives. The OCC considers this the riskiest option.
OCC: Understanding your energy choices
"We definitely are seeing price increases for everybody," Blackwood said. "Over time, (standard offers and energy aggregation) have offered competitive prices, and they've been a good choice for consumers."
While market forces leave little room for easing trends in consumers' cost burdens, Blackwell said there are nominal actions to take that make a considerable impact:
- Switch your house over to all LED light bulbs;
- Adjust your thermostat by a few degrees less or more than you normally would, depending on weather;
- Check the quality of your home's insulation and;
- Apply for utility assistance programs.
Back in Fairfield, all eligible residents and businesses will start receiving letters next week explaining the new rate and how to opt out of the city’s electric aggregation program, approved by voters in the November 2023 election.
Those who don’t opt out will automatically be enrolled at the new rates, Sackenheim said. Residents can opt out at any time at no cost.
Under the program, Duke Energy would still do the billing and customers would call them if power went out or if there were other issues.
About 75% of residential accounts in the city are eligible to participate, Surace said.
There are between 13,000 and 14,000 eligible residential and business accounts in the city, Sackenheim said.
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