Surging Prices Put Sustainable Westchester’s Energy Program on Hold
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Consumers’ electricity bills typically spike in the summer due to heavy air conditioning use during hot weather.
For about 92,000 customers who signed up for the Westchester Power Community Energy Program through Sustainable Westchester during the past six years, there will be another reason for a hike when they receive their bills next month.
Sustainable Westchester announced last Thursday that the program will be paused as of July 1 for customers in the Con Edison territory who signed up for either the 100 percent renewable option or the standard electricity supply, said Dan Welsh, director of the Westchester Power Program. They will have their service revert to the utility’s supply.
Surging energy prices coinciding with the end of the current 18-month contract for the 24 communities in the Con Edison area left little chance for the program to continue uninterrupted, Welsh said. Inflationary pressures made worse by the war in Ukraine has conspired to lift the price per kilowatt into the stratosphere.
“We’re just looking at a market now where there’s no daylight in sight,” Welsh said. “Normally, you would say (prices are) coming and going and there are ebbs and flows, but now with this pressure from the war, and we were already seeing it last year.”
For the 18-month contract that began on Jan. 1, 2021, Con Edison customers who signed up for the program were locked in at 7.4 cents per kilowatt for the 100 percent renewable option, he said. However, the agreement had an initial “not-to-exceed” target of 12.5 cents per kilowatt, which was later revised upward to 13.9 cents, according to Welsh.
Recently, the price per kilowatt has been in the range of 15 to 16 cents, scuttling any chance that a new contract could be negotiated and agreed to by all 24 municipalities by next month.
Local communities that are part of the program include Croton-on-Hudson, Ossining, Mount Kisco, New Castle, Pleasantville, Peekskill and White Plains.
The stable prices, which helped save consumers perhaps 10 percent on their monthly bill, were achieved because there were multiple communities bidding.
The skyrocketing energy rates could cost consumers signed up for the program $5 a month for every penny the price per kilowatt rises, Welsh said. The typical single-family home in southern Westchester uses an average of about 500 kilowatts a month. However, there are some homeowners in the northern half of Westchester who use twice that amount.
Welsh said the sudden rise has been at an unprecedented pace, breaking all historical norms.
“A few years ago, we would have been talking in terms of a few tenths of a cent, up and down, you would sort of know where things are,” he said. “Now things move by pennies in short order.”
For customers that are part of the program, there will be no interruption in their electricity service once July 1 arrives. They are expected to receive a notice in the mail from Sustainable Westchester this week. Another notice from Con Edison will arrive to confirm the switch to its supply.
Nina Orville, Sustainable Westchester executive director, said the global disruption in energy markets has impacted the organization’s ability to execute a new contract.
“We are taking this opportunity to consider how the program can be administered to still capture and provide the same benefits, but to allow for more nimble procurement, which is necessary in these volatile times,” Orville said in a statement. “We understand that the pause in the program will cause uncertainty and stress for many participants and we are working diligently to restore the service to participating municipalities as soon as possible.”
The pause will not affect the program’s NYSEG customers, who are locked into their contract at 10.2 cents per kilowatt, for the remainder of the contract which runs until November 2023. The City of Yonkers, which is also in Con Edison territory, has its own agreement with the utility, also until November 2023, at 8.7 cents.
Welsh is hopeful that Sustainable Westchester will resume the service by the end of the year.
“We’ll get that ceiling and then take bids for it and hope that we don’t run into the same situation,” he said.
For anyone with questions, they may contact Sustainable Westchester at 914-242-4725 or e-mail westchesterpower@sustainablewestchester.org.
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