March 24--An Akron, Ohio-based firm was forced to reduce its electricity rate to Oak Forest residents to keep from losing them as customers.
The Oak Forest City Council on Tuesday voted 7-0 to amend the agreement with First Energy Corp. -- dropping the rate First Energy charges from 6.92 cents per kilowatt hour to 6.5 cents.
Had the firm not gone along with that change, Oak Forest legally could have backed out of the three-year agreement it approved back in 2014 and transferred local residents back to Commonwealth Edison, which earlier this month announced a base rate for its customers of 6.63 cents per kilowatt hour.
Mayor Henry Kuspa said city Administrator Troy Ishler deserves praise for thinking to include such a clause in the city's contract with First Energy.
Ishler said Oak Forest was one of five municipalities that thought to include an out-clause that would allow them to transfer back to Commonwealth Edison if rates for electric power declined.
"Who would have thought the cost of electricity would decline like it has," Ishler said. "It worked to our benefit, and it actually is a clause that [First Energy] does not permit in its contracts any longer."
Under electric deregulation state laws, the city negotiates a deal on behalf of all of its residents with a private company -- getting a lower base rate for all its residents by using them as a large package of customers to offer to the private utility.
Local residents always were given the option of backing out of any aggregation deal and continuing to remain with Commonwealth Edison -- if they wished.
Ishler, in a memorandum he wrote for City Council members, said Oak Forest residents have saved about $2 million in utility bills since the First Energy contract was negotiated in 2014.
"This move will continue that trend," he wrote.
Gregory Tejeda is a freelance reporter for the Daily Southtown.
