The Numbers Are In—Worthington Green Energy Program Brought Residents 20% Savings in 2022

Worthington’s community electric aggregation program yielded very positive results in 2022. Program participants [1], purchasing 100% green energy [2], saved nearly 20% on the generation component of their electric bill compared to the AEP Ohio standard price [3]. This translated into a $129 savings for the average household for the year. Similar (or greater) savings are all but certain to be realized through the end of our current two year contract (ends June 2023), as the open electricity market is experiencing significant upward price pressure.

Looking ahead, we have just secured the terms (price, duration, and energy source) for our next two year contract, which runs July 2023 through June 2025. As noted above, current market conditions are inflationary and volatile, causing generation rates to rise steeply. Despite these adverse conditions, we were able to secure a rate (6.935¢ per kWh) that is nearly 40% below AEP Ohio’s standard generation rate (≈ 11.5¢ per kWh) that is anticipated to be in effect when our new contract begins. That’s significant [4].

As always, savings from a fixed, contracted price relative to fluctuating market prices are not guaranteed, but the recent history and the near-term outlook are very positive. 

As a reminder, there is a no-cost opt-out option for anyone who wants to leave the program for any reason at any time. That was part of the initial proposal to the community and it remains firmly in place, as it should. Yet given the material savings, and the use and promotion of green energy, I anticipate continued broad community participation, for both households and eligible businesses.

And a closing thought: while saving money is a very good thing, I believe it is the emission offsets, obtained through the RECs we purchase, that are ultimately of greater importance to our community and the wider world.  Based on our total program usage of 53,505,818 kWh in 2022, the green energy RECs we purchased translate into emission offsets equivalent to:

• 25,609,293 pounds of coal burned, or
• 4,987 gasoline-powered vehicles for one year [5].

That’s a lot of coal and a lot of cars.

And the impact we are having through this program extends beyond our own community. Other cities are taking note of our program, seeing how financial and environmental objectives need not be exclusive to one another, but can in fact be successfully combined into smart policy: https://davidrobinsonblog.com/2022/11/a-bit-of-good-news-local-global/

Lastly, if interested, I’ve posted about our community aggregation program from its inception in 2018 to the present. Here are a few links:

https://davidrobinsonblog.com/2018/05/electrical-aggregation-in-worthington-how-to-not-burn-20-million-pounds-of-coal/

https://davidrobinsonblog.com/2018/11/a-resounding-yes-for-clean-energy-savings-issue-39/

https://davidrobinsonblog.com/2022/11/a-bit-of-good-news-local-global/

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[1] There are currently 3,675 residential households participating in the aggregation program, which is ≈ 71% of total households.  An additional 21% of residents are with a third party supplier, and 8% are on the AEP Ohio default service. Also, 59% of eligible businesses (i.e., businesses who use 700,000 kWh per year or less) participate in the aggregation program, 32% use a third party supplier, and 9% default to the standard AEP generation rate.

[2] Green energy is sourced in our aggregation program through the purchase of Renewable Energy Credits (RECs).  RECs are an indirect means of using, and supporting, clean energy by providing financial support to the development and operation of clean energy generation.  One REC is issued when one megawatt-hour (MWh) of electricity is generated and delivered to the electricity grid from a renewable energy resource. As an example of the generating source of RECs, in our 2023-25 contract, ≈ 66% of the RECs originate from Iowa wind farms, and 34% from Texas wind sources.

[3] In 2022, the average residential account spent $529 on their electricity generation supply through the aggregation program instead of spending $658 if they were with AEP Ohio default generation (a $129 or 19.6% savings).

[4] It should be noted that although the projected 40% savings are certainly good news, this is in the context of our rates nonetheless going up from 5.186¢ per kWh in 7/21-6/23 to 6.935¢ per kWh in 7/23-6/25. In the current market, that has proven unavoidable.

[5] For more information on calculating emission equivalencies: https://www.epa.gov/energy/greenhouse-gases-equivalencies-calculator-calculations-and-references

And if you want to explore the assumptions and factors considered in establishing the equivalency formulas, visit: https://www.epa.gov/energy/greenhouse-gas-equivalencies-calculator#results