Brian White
Municipal Program Director
Freedom Energy

Published: September 19, 2023

We are delighted to share the next five energy challenges expressed by our municipal clients. We trust you had the chance to dive into our June 2023 Muni Minute and Q2 Newsletter, where we initially unveiled the first five challenges. If you missed it you can catch up on it here. Our clients, including City Mayors, Town Administrators, and Executive Directors, have expressed various challenges when addressing their past experiences with energy initiatives, budgets, and efficiency.

In our previous article, we highlighted the top five hurdles they face, and now, as promised, we’re diving deeper into the subject by presenting the next five challenges. These issues reflect the real-world experiences of municipalities and the proactive steps taken by Freedom Energy to provide solutions and relief.

Before we present the next five topics here’s a refresher to what was convered in part one.

1. Limited Resources
2. Sustainability Requirements
3. Financial Constraints
4. Confusing Contract Terms & Conditions
5. Community Support

6. Account Status (or lack of):

Cities, towns, housing authorities, and even water & sewer departments are often saddled with a substantial number of utility invoices. Managing enrollments, account statuses, new accounts, and rates for numerous accounts can be a time-consuming ordeal. Uncovering and resolving issues can consume valuable staff hours.

Freedom Energy serves as an extension of your team, offering comprehensive account management, including:

  • Reviewing account setups before soliciting offers.
  • Providing enrollment reports to confirm no accounts are missed.
  • Ensuring sales tax isn’t erroneously charged.
    • A surprising number of municipal accounts end up paying sales tax for many months, sometimes years, simply because no one ever noticed.
  • Verifying the accuracy of rates post-enrollment.
    • When the rate is not accurate, the longer it goes unnoticed, the more difficult it is to accurately calculate and request a refund.
  • Identifying and enrolling new accounts under pre-negotiated municipal supply contracts. Our Municipal Team often identifies new electricity and natural gas accounts created post-contract execution where an account has been placed onto the Basic/Default Service with the utility, or automatically enrolled in a Community Choice Aggregation (CAA).
    • These options often represent a much higher rate compared to the existing agreement.
7. Limited Energy Expertise

Beginning with Massachusetts’ restructuring in 1998, there have been several regulation and law changes that have an impact on the price/kWh or Therm–even after an agreement was signed. We have yet to find a municipal organization that has not entered into an electric or natural agreement. Typically, most are familiar with the execution process but the lead-up to that point can take several twists and turns. Management post-contract execution is where real opportunities to save may be uncovered.

In many municipal organizations, one team member is designated to ‘handle’ energy management in addition to their other responsibilities. Others are fortunate to have an Energy Manager on staff, but again, their responsibilities typically extend far beyond energy procurement, so many rely on an energy advisory firm like Freedom to help guide them.

  • After payroll, utility costs often represent the next largest expense for our municipalities, but many express a lack of knowledge, expertise, and resources when choosing the best purchasing strategy.
    • How do you know what is best for the community?
    • What makes the most sense? Which represents the best solution based on requirements and budget goals?
    • Which contract terms and/or conditions should we avoid?
    • When should we execute our next agreement?

Freedom Energy’s specialized Municipal Team continuously monitors the energy markets and consistently researches topics to ensure informed decisions, especially the last one. Energy purchasing is not a ‘set it and forget it’ decision and it is never too early to start investigating your next agreement.

  • As a client, it costs nothing to review and track future-start offers, providing a clear picture of the opportunities available or lack thereof.
  • Working with Freedom Energy, when energy prices are low, you will be in the know!
8. Markets are Volatile

Energy markets are inherently volatile, making it challenging for municipal staff to keep up with ever-changing conditions. For example, Eversource and National Grid in Massachusetts witnessed substantial price fluctuations within just a few months.

Freedom Energy provides insights and supporting data to help clients make informed decisions, ensuring they purchase energy at opportune moments.

Are you aware that:

  • Eversource, one of two major utilities in Massachusetts, charged $0.08879/kWh in September 2021 and $0.46487/kWh in January 2023?
    • That is a 423% increase in just 17 months!
  • National Grid, the other major utility, charged $0.08783/kWh in September 2021 and $0.37607/kWh in January 2023.
    • That is a 328% increase!
  • Imagine the difference between offers for a January 2023 start agreement that was executed during the summer of 2021 vs summer 2022.

Freedom Energy does not have a crystal ball, but we do know our clients need information to be able to make informed decisions. No one knows what energy pricing will do in the future but with Freedom’s guidance, you will have supporting facts and can feel confident you purchased during a low point in the market, historically speaking. There is absolutely no upside in waiting until your agreement is close to expiration to start reviewing renewal offers.

9. Information Overload

Municipal leaders face an avalanche of information from various sources, each touting the perfect solution. Amidst the quest for sustainability and emissions reduction, navigating the market, exploring clean-tech solutions, and uncovering incentive programs can be daunting

There are so many avenues to consider that fulfill your goals and objectives, while also having a positive impact on the community: REC purchases, EV Chargers, EV Fleets & School Buses, Building Electrification, Community Solar, On-site Solar, Battery Storage, Deferred Maintenance, Efficiency, Electric Procurement, Natural Gas Procurement, Microgrids, IRA (Inflation Reduction Act), dozens of incentive programs for Demand Response, and more.

Freedom Energy has been working in this space since 2006, and will help define, advise, solicit, and recommend short and/or long-term energy and sustainability strategies. It does not matter where you start or the size of the project, we partner with you to understand your goals and objectives and define the integrated strategy to assist in achieving your short and long-term goal –even if the deadline is 2050!

10. Consistency & Dependability

Municipal teams are always in transition. Members are on the move, and tenure serving a single community is typically short. When someone on the team changes jobs or leaves to support another community, they can leave a vast knowledge void to fill.

Between Mayors, Town Administrators, Select Boards, CFOs, Facility Managers, Energy/Sustainability Managers, Town Planners, Operations Directors, Assistants and Secretaries, there are normally many roles involved in various aspects of the community’s energy strategy. When someone leaves, someone else must assume their role and responsibilities, and typically a wealth of historical knowledge leaves them.

Freedom’s Municipal Team can partner with you to ensure that knowledge is retained and readily available. Having a team member, you can rely on when it comes to all thing’s energy is enormous.

No matter the plan, objective, goal, or challenge, Freedom Energy has likely experienced it before, and our Municipal Team has the resources and expertise to help achieve it. When you work with Freedom, you are choosing a partner committed to advocating for you, achieving your goals and objectives, and focused on client satisfaction and service.

We also saved our municipal clients in Massachusetts over $20,000,000 in 2022. Contact us to find out how!

This concludes the list of top 10 challenges. Thank you for joining us on this journey through the intricate landscape of municipal energy challenges. We look forward to continuing to support and serve our valued clients.

Share This Story, Choose Your Platform!