Harvard residents face a sharp rise in electric rates this winter, but they can look forward to a drop next May. And the cost increase will be lower for the 1,600 households and 145 businesses that are part of Harvard’s Community Choice Power Supply program than for those who subscribe individually to National Grid’s residential plan.
Like about half the towns in Massachusetts, Harvard has formed a Community Choice program to obtain lower electric rates through bulk purchasing. Town Meeting approved doing so in 2016, and in 2019 the town signed a three-year contract with Dynegy Inc. to supply renewably sourced electricity to town residences and businesses. More than 85% of the homes and businesses in Harvard joined the program. (The schools and town offices have a different contract at an even lower rate.)
With the Dynegy contract about to expire, the town negotiated a new contract with Direct Energy Services earlier this month. Like Dynegy, Direct Energy provides electricity generated 100% by renewable sources, mainly wind power. Direct Energy will replace Dynegy on bills as the supplier of electricity, while National Grid will remain the power distributor, with separate charges for distribution. Customers will still receive their bills from National Grid and make their payments to it.
The contract with Direct Energy for November 2022 through April 2023 sets a rate of just under 27 cents per kilowatt-hour of electricity. A second contract provides for that rate to fall to around 13 cents per kWh next May. The town chose to go with contracts covering just one year, rather than three years, because energy prices are expected to drop further during 2023, said Assistant Town Administrator Marie Sobalvarro, who negotiated the contract.
The new prices are a substantial increase over the expiring three-year contract with Dynegy, which set supply prices around 11 cents per kWh. However, the new prices are still about 25% lower than the basic National Grid residential plan, which lists a fixed price of about 34 cents per kWh for the coming winter. National Grid has not yet announced price levels beyond April 2023.
The 100% renewable plan is the default program for those who have joined Harvard’s Community Choice program. But an optional basic plan that meets the state’s lower renewable energy requirements is available at a fraction of a cent less per kWh.
As explained in a postcard sent to residents by town government, households that want to stay in their current program don’t need to take any action. The transfer from Dynegy to Direct Energy will be automatic. Residents who want to change their current program or get more information can contact Colonial Power Group, the town’s consultant, at colonialpowergroup.com/harvard or call Direct Energy at 866-968-8065.
