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'Clean energy' firm could be next NOPEC partner

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by Robert Recker

Senior Editor

The head of a nine-county bulk-energy buying program predicts that while electricity rates will most likely go up for everybody starting next year, it's "probable" that his agency's 600,000 Northeast Ohio customers will not see their utility bills rise as much as others.

The Northeast Ohio Public Energy Council, which negotiates electrical and natural gas contracts for residents in 126 communities including portions of Summit and Portage counties, announced last week it had signed a letter of intent to purchase electricity from Florida-based FPL Energy starting next spring.

"If everything goes right and the PUCO (Public Utilities Commission of Ohio) moves expeditiously, we'd like this to begin in March," said Leigh Herington, NOPEC executive director.

NOPEC customers, including Kent, Macedonia, Northfield, Peninsula, Reminderville and Twinsburg, currently get their electricity through Akron's FirstEnergy and its subsidiary companies. They took over for former NOPEC partner Green Mountain in 2005 after the Texas-based company opted out of its contract early.

FirstEnergy's deal with NOPEC expires at year's end, but Herington said his agency plans to seek a several-month extension until FPL could step in.

Herington said the delay is needed while PUCO approves the changeover and determines if it would meet federal standards.

NOPEC residential customers currently pay a rate that's 5 percent less than what FirstEnergy charges non-NOPEC members, Herington said. While it's too early to determine exactly what the rate would be over the proposed three-year deal with FPL, his agency is hoping to secure at least that 5 percent discount.

"We won't enter into a financial agreement with [FPL] unless it results in substantial financial savings," Herington said. "We're very encouraged ... that we will be able to provide our customers with a substantial break, more than the percentage break they are getting now."

However, that might not translate into actual savings on what customers are paying now, Herington said, explaining that FirstEnergy's "electric security plan" -- another part of the PUCO review process -- calls for an overall rate increase for FirstEnergy's transportation and delivery fees, a part of the electric bill NOPEC cannot control.

"It is expected that the rate will increase for everyone," Herington said. "But it's probable [NOPEC's] rate will not increase as much as others."

He said it's also not known whether the new energy deal would include a "locked in" rate or if it could change annually or at other set intervals.

According to the FPL Energy Web site, the company produces 75 percent of its energy through natural gas and wind, but also operates solar, hydroelectric and nuclear power plants in 25 states and Canada. A subsidiary of FPL Group, it operates the two largest solar fields in the world, the Web site states.

"We're a clean energy company," said FPL spokesperson Steve Stengel. "One of the bullet points we use a lot in describing ourselves is that more than 90 percent of our energy comes from clean, renewable fuels."

The company's closest assets to Ohio include wind and natural gas facilities it owns in Pennsylvania and West Virginia.

"Although we don't have any assets in Ohio, we do have significant assets in ... the Midwest," he said. "We have yet to procure [the energy for the NOPEC deal] ... but it could come from a mix of our own assets, as well as obtaining power from the market place."

Like Herington, Stengel said it's too early to predict exact rates for NOPEC clients in 2009 and beyond, but "if we were not able to provide competitively priced power, no one would buy it."

E-mail: rrecker@recordpub.com

Phone: 330-688-0088 ext. 3168