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New Jersey Aggregation

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Why is the program an “opt-out” program rather than having residents “opt-in” if they choose to participate?

With the passing of the 2003 law by the State Legislature, the “opt-out” approach was added to help ensure that a meaningful number of residents participate to increase the likelihood of maximum savings.
Past experiences in New Jersey and other states have proven that an “opt-in” program does not obtain a high enough percentage of residents participating to have an effective program.
After years of the program requiring “wet signatures” of customers “opting-in” for aggregators to start the program with little success, the BPU, Rate Counsel and Legislature realized that it was overly burdensome.
These entities came together to make the change to have residents “opt-out” of the program.
A larger pool of customers for Third Party Suppliers to bid on inherently makes the group more attractive to the suppliers encouraging more competition and lower pricing.
The “opt-out” approach results in a larger, more consistent usage for the supplier to bid on compared to an individual customer but still gives the customer the ability to “opt-out” of the program at any time without any fees or penalties.
The regulations also require that an aggregation program show savings versus the utility-provided rates.
Based on the experience in other states, it is anticipated that fewer than 5% of households will opt out.