Power Supply FAQ
How do Cape Light Compact and other energy suppliers arrive at their price for electricity?
Timing of the electricity purchase is an integral component of Cape Light Compact’s price. The point at which power supply is purchased to serve the load for a contracted term reflects the price passed onto consumers. This is true for Cape Light Compact as well as other companies procuring power supply for the consumer market. The timing of electricity purchase also explains why the Compact’s price can either be higher or lower than other offers currently available in the market.
Why does Cape Light Compact purchase my energy supply?
Cape Light Compact was formed in 1997 after the Massachusetts Restructuring Law authorized towns and cities to aggregate consumers to purchase power supply. Through the Compact, over 200,000 Cape and Vineyard energy users have been able to band together to seek out the most competitive energy supply price available, while representing regional interests as energy advocates for our consumers. The Compact is a public entity and its mission is to serve the public interest.
In addition to bringing competitive market prices for electricity to the Cape and Vineyard, the Compact offers a variety of activities and programs to support regional energy efficiency and renewable power development and offer energy education to Cape and Vineyard students. From July 2001 through December 2009, Cape Light Compact contributed over $45 million in energy efficiency services to the residents and business of Cape Cod & Martha’s Vineyard. In 2008, Cape Light Compact’s Energy Efficiency Programs saved enough electricity to power 1,600 homes and remove the greenhouse gas emissions from the equivalent of about 1,000 cars.
What makes Cape Light Compact’s power supply contract comprehensive and worry-free?
When Cape Light Compact secures a contract to supply power for our region, the price per kilowatt hour that we negotiate on behalf of customers on the Cape & Vineyard is fixed for a specified time and inclusive of any additional charges that many suppliers prefer to “pass through” as an adder to their initial price. This “pass through” provision is in many electric contracts; however the Compact’s electric supply contract does not allow any additional costs to be “passed on” to our customers. Again, the Compact negotiates a comprehensive contract ensuring worry-free premium service at a fixed price regardless of fluctuating market conditions. With our contract, the supplier takes on all the risk, not the Compact’s customers.
Why should I stay with Cape Light Compact?
Customers should stay with the Compact because of our comprehensive approach to energy services – power supply, energy efficiency programs, and consumer advocacy. The Compact is a public entity and its mission is to serve the public interest. In the long run, customers are overall better served by a grass roots public entity than a company with a profit motive.
Having a viable power supply program also enables the Compact to administer millions of dollars in energy efficiency funds and keeps these funds on the Cape and Vineyard in the form of energy efficiency services. The Compact urges all consumers to avail themselves of one of the Compact’s energy efficiency services or through low-cost energy efficiency measures that can be found at their website www.capelightcompact.org. For question on how to save, please call 1-800-797-6699.
Is Cape Light Compact responsible for all of the electricity costs on my energy bill?
No. Cape Light Compact is only responsible for the Generation Charge listed on your electric bill and administering energy efficiency programs funded by the Energy Conservation charge. The Cape Light Compact has contracted a competitive fixed rate with ConEdison Solutions to supply power to our customers on Cape Cod and Martha’s Vineyard and that rate is reflected through the Generation Charge.
How often will my electric rates change?
Cape Light Compact’s electric supply prices for residential and small commercial customers change every six (6) months. Prices for medium and large commercial and industrial customers change every three (3) months.
How does my electricity get to me?
All New England states share one single network of power, called the electric grid. Generators from all over the region feed power into this grid and energy is drawn out on an as-needed basis. Since electricity in New England is based on a regional mix, the electricity that is actually delivered to your home or business is determined by which power generators are located closest to you. The New England electric grid is managed and operated by an Independent System Operator (“ISO-NE”). ISO-NE is responsible for managing the dispatch of all power plants within the region so there’s always enough power being generated to meet the needs of the region.
Understanding the charges on your electric bill:
Customer charge: This represents the costs of providing services such as metering, billing and account maintenance. These are fixed costs and are not affected by the actual amount of electricity used.
Distribution: This represents the cost of delivering electricity over wires to your home.
Transition: This represents the cost of past investments in generating plants and power contracts.
Transmission: This represents the cost of moving electricity over high-power lines from a generating plant to NSTAR’s service area.
Renewable Energy: This represents a charge the Massachusetts Renewable Energy Trust Fund to increase the availability of renewable energy.
Energy Conservation: This monthly charge covers the cost of energy efficiency programs administered through Cape Light Compact for our service region.
Generation Charge: This portion of your bill represents charges associated with the supply of electricity only. Cape Light Compact has contracted a competitive fixed rate with ConEdison Solutions to supply power to our customers on Cape Cod and Martha’s Vineyard and that rate is reflected through the Supplier Services/Generation Charge. This is the only charge on your electric bill negotiated through Cape Light Compact.