A Naperville advisory board that has been taking a deep dive into the city’s contract with the Illinois Municipal Electric Agency (IMEA) is examining a number of different scenarios, from a retail and wholesale standpoint.
Two consultants provided a pair of presentations to the Naperville Public Utilities Advisory Board (PUAB) at the appointed group’s Thursday, May 29 meeting. Chris Townsend, energy law partner at CJT Energy Law LLC, and Mark Pruitt, principal at The Power Bureau, shared their findings in a retail supplier presentation and an energy cost comparison.
IMEA is seeking a 20-year contract extension from the City of Naperville and its other member communities to ramp up its renewable energy and decarbonization efforts, according to organization officials.
Locally, several grassroots organizations have taken aim at IMEA, citing its continued reliance of burning coal as an energy source.
PUAB upholds recommendation to stay with IMEA
No formal action was taken after the presentations at the recent meeting. The PUAB in April handed to the decision-making city council a recommendation to extend the IMEA contract on a narrow 4-3 vote.
James Fillar, who chairs the PUAB, weighed in on why the studies were commissioned at this time and placed on the board agenda after an hours-long discussion that attempted apples-to-apples comparisons between IMEA and other options.
“We’ve made the recommendation, and now there’s information going out in this community,” Fillar said. “The purpose of this meeting is to make sure that we have the experts here, talking to us about what the real facts are, because there’s a lot of bad facts out there, unfortunately.”
Fillar said he also was concerned some members of the city council do not have a full understanding of the PUAB’s work concerning the IMEA contract because of their obligations to other issues within Naperville.
“Right now, I don’t believe a majority of them understand the issue, because I don’t believe a majority of them have seen not one of these meetings or have talked to anybody, other than someone who’s already made up their mind to them,” Fillar said.
He added, “What we’re trying to do is get the information out to people. That’s all we can do at this point.”
One study compares IMEA to ComEd
Townsend and Pruitt took the wraps off their study, comparing rates between IMEA and Commonwealth Edison, the largest electric utility in Illinois.
In an analysis going back to 2017, ComEd rates were lower than IMEA’s for a number of years, according to Townsend and Pruitt’s number crunching. However, that trend reportedly began to change — particularly for residential customers — within the past year.
“It seems that the price advantage for being a ComEd customer has flipped,” Pruitt said. “We don’t know if that trend continues. Time will tell. But it is a decided change in the pattern.”
Taking a long view of the energy market, Pruitt and Townsend said there is a litany of unknowns, from a regulatory and economic standpoint.
In their study, they asserted the City of Naperville has less volatility in the market, assigning a 0.495 index score, compared to the 2.321 score given to ComEd. An inflation index provided similar figures, with the consultants giving Naperville a 4.2% rate and ComEd an 81.2% rate.
Several board members, including Michelle Ackmann, shared their views on the analysis between the two providers. Because of its scale, Ackmann noted ComEd offers low-income programs, hourly pricing initiatives, and an innovation department.
“It’s a little bit of you get what you pay for,” Ackmann said.
Going solo would be complex — and, likely, costly
In the second study, Townsend and Pruitt reviewed the intricacies and complexities involved in supplying electricity as a member of PJM Interconnection, the regional operation that manages the electrical transmission grid through portions of the Upper Midwest and Northeast.
“There’s legal activities, lots of compliance — lots and lots of compliance — because PJM is a federal entity,” Pruitt said. “It receives its charter from the Federal Energy Regulatory Commission.”
On the prospect of going independent and breaking free from IMEA and a provider such as ComEd, Pruitt said, “You can cut your own hair, but most people don’t do that. It’s because there’s someone else who can do it, and, as a group, you can share the burden.”
Bidding out 10 years, when Naperville’s current IMEA contract sunsets, poses an additional wrinkle in the overall process, Pruitt said.
“Your procurement process is not as simple as posting a bid, taking in prices, ranking them according to price and then executing a contract,” Pruitt said. “There’s a lot of planning, a lot of preparation, and a lot of guesswork that is going to be done in this.”
He added, “This 10-year runway, before delivery, is really a challenge, and I don’t envy you. This is tough.”
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