SPECIAL REPORT: Energy benefits of being local
Communities with municipal electric departments have more control of rates.
By Jesse Floyd
jfloyd@wickedlocal.com
Dec 7, 2016
There are 312 towns and 39 cities in Massachusetts, stretching from Provincetown on Cape Cod to Egremont in the west.
In most, when someone hits a light switch, the power flows from a major utility, such as Eversource. In a select few, including Belmont, Boxborough, Concord, Littleton and Wellesley, the juice has a more local origin.
Those communities are among the 50 municipalities served by 41 local utilities. Municipal utilities set their own rates and provide service to local customers. The 41 municipal light plants in the state provide electricity to about 15 percent of the available customers, according to the Massachusetts Alliance for Municipal Choice.
Littleton's municipal electric department was started in 1912 and provides power to neighboring Boxborough as well. The Littleton Electric Light Department serves 6,900 residential customers and 400 commercial/industrial customers.
According to the alliance, Concord is a mid-size municipal light plant. In 2007, it provided 181,7 million kilowatts to 7,700 customers. It employs around 21 people, including 11 linemen.
Advantages to being local
A study done by then-Gov. Deval Patrick's administration cited lower costs, improved reliability, and greater responsiveness to local energy initiatives.
"I think the big thing is it's local control," said Scott Edwards, general manager at Littleton Electric Light Department. "We serve Littleton and Boxborough, but the residents of Littleton have control over the light department. They elect the commissioners. The commissioners are citizens - ratepayers."
Those ideas: More local control, more individual attention more personalized service, were echoed by just about each municipal utility interviewed.
"Having local control over services provided, because we have local control, we end up with a higher level of reliable electricity, a higher quality of customer service, and more personalized service," said Jim Palmer, director of the Belmont Light Department.
Having people sit on the board for the light plant was cited over and over again as a major advantage for a municipal electric plant.
"In Wellesley, the light plant is governed by a Municipal Light Board consisting of five Wellesley residents. Unlike utilities with large customer bases that are forced to implement 'one size fits all' policies among towns and cities with vastly different social and economic disparities, the Wellesley Light Board can design and implement policies that specifically target the characteristics of town residents and businesses," wrote Debra Healey, assistant director of the Wellesley Municipal Light plant, responding to questions from the Wellesley Townsman.
"The decision is...; right here," Edwards said of municipal electric departments. "We don't have to go to a board of directors and stockholders. We can be very reactive."
In conjunction with local control, another big advantage is cost, according to a study on municipal light plants commissioned by the Metropolitan Area Planning Council. Among the study's findings: Local light plants can keep costs lower because they are not beholden to investors and not required to turn a profit to keep investors happy.
"We don't make profits. We don't have stockholders," said Edwards. "All of our profits basically go back either to the ratepayers or to the system for improvements."
Customers of local utilities also enjoy rate stability. Littleton has the lowest residential rates in the state, according to Edwards.
The average customer of a municipal light plant paid between 38 percent and 47 percent less than the average investor-owned utilities, according to the Massachusetts Alliance for Municipal Electrical Choice.
After accounting for the differences in funding of energy-efficiency, renewable and low-income programs, major utilities still charge $30-$35/month more than local plants, on average, according to the Alliance.
Being local also helps when there are problems: According to Palmer, Belmont had power back within 12 hours after Superstorm Sandy came through in 2011. Surrounding towns, not served by a municipal plant, went several days without power. The number of workers and the familiarity with the system architecture make responding to problems easier, he said.
Green energy
Whenever discussing energy in 2016, the source - and its credentials as "green" or environmentally friendly - often come to the forefront. Because they are local, the initiatives around green energy are also local.
Littleton has used funding from the Green Communities grant program by the Massachusetts Department of Energy and Environmental Affairs to replace half of the approximately 800 streetlights in town with LED bulbs and make energy efficiency upgrades for the School and Water Departments.
In Belmont, the municipal plant has been involved in the push for rechargeable electric vehicles. The town hasn't established charging stations as yet, but the municipal light plant is offering incentives to purchase electric vehicles, and also offering incentives to put in a smart charger, monitoring electric use.
Belmont light, like other municipal plants, is paying back solar customers at a set rate, based on the power generated.
The Littleton electric department purchases electricity from a variety of sources. The focus in recent years has been signing contracts with renewable energy sources. Edwards predicts the power provided by Littleton will be 25 percent from renewable sources by 2020.
"We've been buying a lot of renewable power," Edwards said. "We've always had quite a bit of hydropower, but now we're getting into wind and solar."
Reporters Henry Schwan, Cathy Brauner, Molly Loughman, Joanna Tzouvelis, and Alexander Silva contributed to this report.