Program News & Info

What is energy aggregation?

Government Energy Aggregation (GEA) is a program that came from the passing of the Government Energy Aggregation Act of 2003 by the New Jersey Legislature. This law gave municipalities and counties the ability to aggregate the energy usage of the residential and non-residential ratepayers to conduct a bulk bid or auction in an attempt to get the lowest possible price at that given time in order to maximize the benefits of deregulation to the participants. These benefits include a lower utility cost and an increased number of suppliers to choose from within New Jersey. If a government entity, such as your municipality, chooses to establish this program on your behalf, an RFP will be sent to every third party supplier in New Jersey that is licensed with the Board of Public Utilities. Your municipality is utilizing an independent Consultant to implement a procurement process for a third party supplier to provide energy supply to its residents.

How does the program work?

• This program covers only the power supply portion of your electric bill.

• The delivery and distribution of electricity under this program will continue to remain the same, through the regulated utility that serves your home.

• New Jersey’s Retail Choice regulations allow you to purchase power supply from a third party supplier. Most residential electric customers in the State have not switched to a third party supplier; therefore they obtain their power supply from their Local Distribution Company.

• The municipality has engaged an independent consultant to collect energy usage information, prepare bid specifications, and seek pricing from third party suppliers through a public bid process.

• All municipality residents are automatically included in the Aggregation program unless they have already chosen a third party supplier.

• The program will leverage the bulk purchasing power of all of the municipality’s residents to obtain power supply that is less expensive.

• Although all residential customers in the municipality not currently purchasing from a third party supplier are automatically included in the program, a resident may opt-out of the program if they wish. In order to comply with the state law governing energy aggregation programs, the program must be an opt-out program, versus an opt-in program. N.J.A.C. 14:4-6.3(i): If a residential customer is located within the geographic boundaries of a municipality or county that establishes a government private energy aggregation program, the residential customer shall automatically be included in the program unless the customer indicates [its] his or her desire not to participate in the program by opting-out in accordance with N.J.A.C. 14:4-6.5 and 6.6.

• The local utility will continue to handle your account, addressing any outages and maintaining service. The only change is the billing and cost of the energy provided.

Overall, how does the program benefit the residents?

The program ensures that they will receive a rate that is lower than what the local utility is currently charging them. It will also give them increased protection in obtaining a third party supplier by eliminating all the confusing fine print. It forces the third party suppliers to compete for your business on an even playing field by giving everyone a price on a larger amount of energy on the same date under the same terms and conditions that are dictated to them through our RFP criteria, rather than them dictating to you what the terms of the contract will be. These criteria can also include a higher percentage of “green” renewable energy that will help create a cleaner environment.