FAIRFIELD, Ohio — Some homeowners in the Tri-State who are electric aggregation program members could see a big rise in energy costs in 2025.
In Fairfield, where 80% of residents have opted into the city aggregate electric program, the price per kilowatt of energy generated could spike up to 40%, according to Councilman Tim Meyers.
"Since electricity is core, and having an increase like that, it's a big deal," he said. "My understanding on this is that there's not enough supply (and) there's huge demand out there."
An electric aggregation program occurs when a person or organization brings a group of customers together, according to the Energy Choice Ohio website, to negotiate for lower energy prices and additional benefits for group members.
Watch to learn more about why energy prices could spike and who it may impact:
In November 2023, Fairfield residents voted in favor of starting both electric and gas aggregation programs.
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.
On the recommendation of Richard Surace, COO of consulting firm Energy Alliances, the city signed a one-year contract with Dynegy in February 2024 to be the supplier for the program, which allowed residents to opt-out if they chose.
In his presentation on options for a new electric contract this week, Surace said those enrolled in the electric program collectively saved $1.72 million over an eight-month period or an average of $151.15 per household.
When Energy Alliances asked for bids from four suppliers, it received two responses — Dynegy and Constellation, whose rates ranged between 8.71 and 8.74 cents per kilowatt of electricity used, respectively.
That compares to the current Dynegy rate of 6.17 cents per kilowatt of electricity.
"(When) we had a presentation at the city manager briefing this past Monday ... sticker shock, prices are up," Meyers said.
Although Duke’s default rate for June is unknown, Surace said it is estimated to be in the range of 9.7 cents to 10 cents per kilowatt of electricity.
Surace said the next auction for electricity that Duke could participate in is March 18, followed by an April 15 auction.
Those results could determine whether it’s in the city’s best interest to sign a contract with a bidder or revert to Duke’s default rate.
Council directed staff to prepare legislation for its Feb. 24 meeting that would give the city manager the authority to sign a one-year contract provided it did not exceed a certain amount.
That said, Meyers would give the city the flexibility needed to accept an offer between council meetings. The council will be updated on the situation during the meeting and ensuing discussion.
"This is not a fair field problem. This is going on regionally and probably nationally," Meyers said. "It makes it a little bit complex."
In Colerain Township, officials are also preparing to enter into a new electric aggregate contract. Legislation has been prepared for township trustees, putting a hard cap on the new energy price at 9.49 cents per kilowatt of electricity.
Its current rate, which is set to expire in May, is 6.89 cents per kilowatt of electricity.
"Rising energy costs are hitting families across the Tri-State hard, and we hear your concerns," reads a statement from a Colerain Township spokesperson. "Partnering with Energy Alliances, we’re doing the research to provide a reliable option, but we encourage you to explore your choices to find what works best for your family."
According to the township spokesperson, between 2020 and 2023, households in the program saved, on average, $170 compared to the default rate.
"(We are) proud to offer electric and gas aggregation programs designed to save our residents money," the statement reads. "This program is entirely optional, giving Colerain Township residents the freedom to opt out if it doesn’t fit their needs."
Surace said there is concern in the energy market that the electric will not be able to keep pace with the skyrocketing demand for energy in the future.
"These demands are coming from a variety of sources that include large industry, data centers and even homes as we all continue to plug in devices that need electricity," Surace said in a statement.
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