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Power to the People: Colts Neck Hires Firm to Help Reduce Energy Costs

Written by The Two River Times. Posted in Front Page, News

Power to the People: Colts Neck Hires Firm to Help Reduce Energy Costs

Published on September 06, 2013 with No Comments

By John Burton

COLTS NECK – The township committee is hoping its recent move to hire an energy-consulting firm will result in savings on residents’ electric bills.

The township committee voted to retain Gabel Associates of Highland Park during its Aug. 28 meeting. The firm will act as the township’s consultant to negotiate with energy providers to secure a lower rate than residents and businesses currently can get.

Gabel, which has assisted hundreds of school districts with energy needs over the years, began working with municipalities about 18 months ago as a community energy aggregation consultant.

So far, Gabel has completed projects for Toms River and Plumstead Township and has secured energy rates that are 14 and 11 percent lower than what users had been paying, according to Ken Esser, a senior associate for Gabel.

The firm is currently working with a number of other municipalities.

Assemblyman Declan O’Scanlon, R-Monmouth, is working as an independent consultant for Gabel.

“For me, it’s an opportunity to see residents of my district and the people of New Jersey at-large save money, especially when there’s no risk,” he said. “I’m inclined to get involved to have that happen.”

As a consultant for Gabel, O’Scanlon works with representatives from municipal governments, explaining the benefits of having Gabel pursue lower energy rates for the community.

In Colts Neck, Mayor Michael Fitzgerald said the township committee received six responses to its request for proposals. Fitzgerald supported Gabel, “because they were successful in a couple of towns” already.

What happens in such arrangements is that Gabel Associates, an energy and public utility consulting company, works with a municipality to find an energy provider with rates lower than those being offered by its present provider. In Colts Neck, Jersey Central Power and Light (JCP&L) will continue to deliver the power but the source of the power will be another company as negotiated by Gabel. Home and business owners will still receive their bills from JCP&L, but hopefully at a lower rate.

The negotiation of such arrangements is permitted under the state’s Energy Aggregation Act, which the Legislation passed in 2003.

According Esser, there is “no out-of-pocket expenses for the municipality in any way,” as his firm earns its fee by factoring it into the total per kilowatt-hour charge that will be paid for by the user. Users new electric rate will be at least 5 to 10 percent lower than currently and could be even lower.

Gabel looks for providers to secure the lower rates for a fixed period, usually for one or two years. Customers are not required to opt in and can opt out at any time, Esser said.

O’Scanlon said works for the company to educate municipal officials on community energy aggregation and advises Gabel on strategy and other business facets.

“He’s really an important part of our team,” Esser said.

O’Scanlon, along with his Assembly obligations, runs FSD Enterprises, LLC, in Red Bank, a consulting firm that assists municipalities negotiating with wireless communications providers.

Under state law, O’Scanlon is permitted to work with municipalities within his district.

“I go out of my way to avoid any potential accusation of conflict of interest,” said O’Scanlon, who is not paid by municipalities but acts as a paid representative of Gabel.

Fitzgerald said he expects the average homeowner in his community who participates to see as much as a $200 saving annually on the electric bill.

“Every year it seems we have to tell the residents here it’s going to cost them more in taxes,” Fitzgerald said. “If we find a way to save them $200 a year it makes the pain a little bit more tolerable.”

There are no big ways to save taxpayers money; it’s up to officials to find as many little ways as possible to save and hope they curb costs cumulatively, O’Scanlon said.

“You explore everything,” he said.

Among the municipalities Gabel is now working with are Montgomery Township in Somerset County, Monroe, Lambertville and West Orange, Esser said.

Colts Neck has been approached by six or seven communities looking for information about the township’s experiences, Fitzgerald said.

 

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