With the transition period to full energy competition just a little less than a year away, the League strongly supports A-2165. This bill would substitute an unworkable and self-contradictory process of governmental energy aggregation, with a practical plan that could provide real rate reductions for New Jersey's municipalities, counties, school districts, community service institutions, homeowners and small to mid-sized businesses. This bill will give local governments a tool that can be used to reduce electric and gas energy costs.

That tool is "all in/opt out" energy aggregation. It is a tool that was made available, as a pilot program, to one New Jersey municipality in the mid-90s. That municipality was Monroe Township in Middlesex County. And that tool saved the residents of Monroe Township money. It is a tool that has been made available to Ohio municipalities. And, to date, it has saved about 595,000 residents of over 150 Ohio municipalities money. In fact, the residents of Ohio municipalities that have aggregated are saving about double the amount saved by their fellow citizens under state mandated rate caps.

Municipal aggregation offers individual energy consumers the opportunity to combine their buying power, so that they can negotiate lower rates and better service from the energy industry.

A-2165 would give potential aggregators access to consumer information that they need in order to offer the option. It would eliminate the "one contract" limitation, which can hamstring municipalities trying to negotiate the best deal for each class of ratepayers and for each type of power. It would allow customers to "opt in" to a municipal aggregation, using the same means that the statutes currently allow them to use to "opt in" to private aggregations. The sponsors have welcomed our input. We are working directly with them and with the Board of Public Utilities on this and other issues.

The philosophy behind this bill is simple. Government, in the public interest, must allow consumers to form aggregation groups as numerous, broad and diverse as is reasonably possible. For, the more extensive and balanced the aggregation group, the more savings for consumers. Only with this market power can consumers, particularly residential consumers, have the requisite bargaining power to fairly contend in the deregulated marketplace.

This legislation needs to be passed by this fall, to give local governments the time they will need to evaluate and implement a municipal aggregation, in time to save their consumers from the inevitable rate hikes that otherwise await us.