How aggregation works

Municipal electricity aggregation is a form of group electricity purchasing. Electricity aggregation replaces your electricity supplier, and it changes the price that National Grid uses to calculate the supply services charge piece of your electricity bill. In addition, aggregation can increase the amount of renewable energy in your electricity supply. But electricity aggregation does not replace National Grid as your electric utility.

Here’s how it works:

Without the Salem PowerChoice program

(Unless you already have a contract with an electricity supplier)

Typically, National Grid provides two services to you as an electricity customer, and your electricity bill includes charges for both of these services:

Electricity delivery

National Grid’s primary role is as an electricity delivery company. They deliver electricity to you, maintain the poles and wires, and address power outages. They charge you for these services on the delivery services part of your National Grid electricity bill.

Electricity supply

For most people, National Grid also provides a second service, which is as an electricity supplier. They purchase electricity on your behalf and charge you on the supply services  part of your National Grid electricity bill for the amount you use. When National Grid is your electricity supplier, you have National Grid’s Basic Service. When you first open your electricity account, you are placed on National Grid’s Basic Service.

The diagram below shows National Grid both delivering and supplying electricity.

Without Salem PowerChoice, National Grid both delivers your electricity and also supplies it (buys it for you)

National Grid’s fixed Basic Service prices change seasonally, every 6 months for residential and commercial customers and every 3 months for industrial customers, and future prices are not known.

With Salem PowerChoice

In an electricity aggregation like Salem PowerChoice, National Grid continues to deliver your electricity and you continue to call them when the power goes out, but you no longer have National Grid’s Basic Service for the supply portion of your electricity bill. Instead, the City of Salem uses the bulk purchasing power of the community to negotiate a contract with an electricity supplier that residents and businesses can benefit from, which will determine the price of the your electricity supply. If you participate in Salem PowerChoice, National Grid uses a Salem PowerChoice price to calculate the supply services portion of your electricity bill instead of their own Basic Service price.

With Salem PowerChoice, an electricity supplier selected by Salem buys cleaner electricity for you. National Grid continues to deliver it.

 

What changes with the program

If you participate, you will see two changes on your National Grid electricity bill beginning the month after you enroll:

  1. Salem’s electricity supplier, Dynegy, will be listed on your bill as your electricity supplier
  2. National Grid will use a Salem PowerChoice price to calculate the supply charge portion of your electricity bill instead of their own Basic Service price.

See an example National Grid bill.

Otherwise, your primary relationship for electricity will remain with National Grid. This means:

  • You will continue to receive one bill from National Grid. This is the only electricity bill you will receive as a participant in Salem PowerChoice.
  • You will continue to call National Grid if your power goes out. National Grid will continue to deliver electricity, restore electricity service after a power outage, and maintain the poles and wires.
  • If you receive net metering credits from solar panels on your National Grid bill, those will continue to be calculated using National Grid’s Basic Service price, not using a Salem PowerChoice price.
  • If you are eligible for a low-income discount, you will continue to receive that discount.

Participating in the program

All new electricity customers in Salem will be automatically enrolled in Salem PowerChoice within a few months of opening the account. Automatic enrollment is state law.

You will receive a notification in mail from Salem before being automatically enrolled with information about the program. If you do not wish to participate, you may opt out before being automatically enrolled or any time after enrollment, with no penalty. If you choose to opt out, National Grid will continue to be your electricity supplier, and National Grid will use their own Basic Service price to calculate the supply services portion of your electricity bill.

Learn how to enroll if you will not be automatically enrolled.