Last year, Verona introduced a program to help residents buy electricity from more sustainable sources and at a lower price than PSE&G. All Verona households were enrolled in the Sustainable Essex Alliance Renewable Government Energy Aggregation (SEA) program, but residents had the ability to opt out. If you are in it, you may have gotten a letter from Direct Energy about a billing increase. Here’s what happened.
Under the contract that began in June 2019, residents in the SEA program got power at a contract price that was more than 10% below the average posted PSE&G price for power supply. There are two components to an electricity bill, power supply and transmission costs.
The contract between Verona and Direct Energy prohibits price changes, except for costs caused by a change in law or other governmental action. Early this year, the Federal Energy Regulatory Commission approved a large increase in the price that power suppliers pay to use the high-voltage transmission grid that moves electricity from power plants to the PSE&G distribution system. That changed affected Direct Energy as well as PSE&G.
While Direct Energy can adjust the SEA contract price to recover this cost increase, Verona’s contract specifies that the adjustment can be no more than the increase in PSE&G’s price caused by the same government action. According to township officials, the transmission cost increase raised PSE&G’s power supply prices by about 1.2 cents per kilowatt-hour. About one-third of that increase took effect in February, and the rest in June.
But before you opt out of the SEA contract, you should take this into consideration: PSE&G customers are paying the same power supply cost increase. Verona’s SEA savings relative to the overall PSE&G price remains the same and the SEA contract continues to deliver more energy from renewable sources than the power supplied directly by PSE&G.
If you do want to opt out, you can contact Direct Energy at 1-866-968-8065 or by emailing [email protected]
