What is the Salem PowerChoice program?
National Grid is responsible for electricity delivery in Salem. In addition, National Grid typically chooses your electricity supplier and passes the cost of the electricity itself, known as electricity supply, along to you. This is called Basic Service.
The Salem PowerChoice program is an alternative to Basic Service called electricity aggregation. Electricity aggregation is form of group purchasing in which the City selects an electricity supplier on behalf of Salem residents and businesses, determines the amount of renewable electricity in the City’s electricity supply, and determines the price that is used to calculate the supply services charges on participants’ National Grid electricity bills.
However, National Grid delivers electricity to Salem and handles all electricity billing and power outages..
Why is it important to have a stable electricity supply price?
Having a stable price for the supply part of your National Grid electricity bill can protect you from the seasonal price increases that occur when you have National Grid’s Basic Service. When National Grid is your electricity supplier, the price that is used to calculate the supply charges on your National Grid bill changes every 6 months for residential and other small customers, and it changes more frequently for larger commercial customers.
Having a stable price for the supply part of your National Grid electricity bill can also provide a predictable alternative to the variable prices offered by some commercial electricity supply offers. Some commercial electricity supply offers will provide a stable price for a few months, but then the price will vary monthly.
The Salem Power Choice price is fixed for 30 months from June 2019 through December 2021. When the City signs a new contract and the price changes, the City will announce the new price publicly before it takes effect.
What is the difference between National Grid and an electricity supplier?
National Grid is Salem’s electric utility. They are your electricity delivery company. That means National Grid is responsible for delivering electricity to you, for maintaining the poles and wires, and for addressing power outages. National Grid charges you for these services on the delivery services portion of your electricity bill.
An electricity supplier is a company that buys electricity for you from electricity generators or from electricity brokers. When you have National Grid’s Basic Service, National Grid is also your electricity supplier, meaning they are buying your electricity in addition to delivering it. National Grid does not generate electricity.
- For most electricity customers, their utility is also their electricity supplier. When they are your supplier (i.e., when you are on National Grid’s Basic Service), your electricity bill will indicate that is the case.
- You may also choose your own electricity supplier. If you do, the name of that company will appear on your National Grid bill as your electricity supplier, and the rate you negotiated with them will be used to calculate the supply services charges on your bill.
- In Salem PowerChoice, the City chooses an electricity supplier on your behalf. Salem has signed a contract with Dynegy to supply electricity to the City. Dynegy will appear on your National Grid bill as your electricity supplier, and the rate the City has secured from with them will be used to calculate the supply services charges on your bill.
Does this program replace National Grid as my electric utility?
No. National Grid is the electric utility for Salem and will continue to deliver your electricity, and your primary relationship for electricity will remain with National Grid.
Salem PowerChoice will change the supplier on your National Grid bill to Dynegy, and it will change the rate that is used to calculate the supply services charges on your National Grid electricity bill. But your bill will continue to come from National Grid, and National Grid will continue to be your electric utility.
What will my electricity supply price be if I participate?
How long will the program last?
The aggregation will last as long as Salem wishes it to. The individual contracts that Salem signs with electricity suppliers are of varying lengths. When the current contract ends, Salem can establish a new contract for electricity supply, or it can end the program and return participants to National Grid’s Basic Service.
What changes with this program?
After your account is enrolled in Salem PowerChoice, you will see two changes on your National Grid electricity bill:
- Your price used to calculate the supply services portion of your bill will change to the program price.
- You will see the City’s supplier listed on your bill as your electricity supplier.
Everything else will remain the same. You will receive your bill from National Grid, you will pay National Grid, and you will call National Grid when your power goes out.
Who is eligible to particpate?
All metered electricity customers within the geographic boundaries of Salem are eligible to participate. All National Grid Basic Service customers are automatically enrolled shortly after they establish an electricity account with National Grid, unless they choose to opt out of the program.
I have signed my own contract with an electricity supplier. Will I be enrolled in the program?
If you have already signed a contract with an electricity supplier before being enrolled in the program, you will not automatically be enrolled in Salem PowerChoice.
However, you are welcome to participate.
If you would like to participate, we recommend that you first check the terms of your existing electricity supply contract. Many include minimum enrollment periods and early termination fees.
Do I have to participate?
No. You may choose not to participate. This is called opting out. There is no penalty for opting out. You may do so at any time. If you opt out, you will continue with or be returned to National Grid Basic Service.
You may opt out anytime.
What if the National Grid's Basic Service price falls below the program price?
This is likely to happen during some months. The reason is because the program prices are long-term, fixed prices, but National Grid’s Basic Service prices change every 6 months for residential and commercial accounts and every 3 months for industrial accounts. Future prices are not known. As a result, savings compared with National Grid’s Basic Service price are not guaranteed. However, you are free to opt out of the program and return to Basic Service at any time with no fee or penalty.
My account is tax exempt with National Grid. How do I maintain my tax exempt status in Salem PowerChoice?
Tax exempt accounts that wish to maintain their tax exempt status in the Salem PowerChoice program must submit tax exemption documentation to the program’s electricity supplier.
This means that tax exemption documentation must be submitted each time the program’s electricity supplier changes.
The program’s electricity supplier is required by the State of Massachusetts to have valid tax exemption documentation on hand for all tax exempt accounts.
You may have submitted tax exemption documentation to National Grid already, but National Grid does not share this documentation with the program’s electricity supplier. It is the customer’s responsibility to submit this documentation.
Get information on where to send your tax-exemption documentation
Who do I call when the power goes out?
Call National Grid if your power goes out. National Grid will deliver your electricity and maintain the poles and wires.
Will I receive a second bill?
No. National Grid will bill you for your electricity. This is the only electricity bill you will receive as a participant in Salem PowerChoice.
Will I receive a lower quality of service if I participate in this program?
No. National Grid’s quality of service to you will be unaffected by your participation in Salem PowerChoice. The reason is because National Grid does not profit from the supply charges on your electric bill. They pass the electricity supply charges along to you with no markup. They make their profit from the delivery services charges on your electricity bill. As a result, they have no preference whether they are your supplier or Salem chooses a supplier for you.
I am currently under National Grid budget billing/eligible for the low-income delivery rate. Will this change?
If you participate in budget billing or are eligible for any discounts from National Grid, those will not be affected by your participation in Salem Power Choice.
I have solar panels on my property. If I join the program, will I continue to receive net metering credits?
Yes. Net metering will work the same way if you participate in the program. Your net metering credits from your solar panels will continue to appear on your National Grid bill and will continue to be calculated based on National Grid’s Basic Service price.