Who Should Supply Your Electricity?
Be wary of unsolicited offers to supply you with electricity, even if it is 100% clean and cheaper electricity. Recently, I got a glossy offer in the mail from Inspire Clean Energy promising a $100 reward card, a flat rate for the Supply portion of my bill at $129.99 per month with no restriction on usage, and 100% of the electricity would be from clean energy sources! The promo exhorting me to combat climate change, lead the way for a better future with clean energy, and help create a net-zero carbon future.
Sounds great, right? Especially for those concerned about climate change, like members of Chelmsford Climate Action Team. However, claims of unlimited usage and combatting climate change without changing your lifestyle seem too good. What company promoting clean energy, would encourage increased consumption? Maybe they really do want to promote clean energy, but that would only be the case if customers used the increased electric usage on devices that reduce their carbon footprint, like EVs, heat pumps, electric lawn care equipment, etc. However, customers could take advantage of the unrestricted usage to heat an outdoor pool or hot tub, add a whole house air-conditioner, and power thousands of Christmas lights.
Right after receiving the glossy flyer in the mail, another member of Chelmsford Climate Action Team asked me about the same sales pitch. Only his offer was for $64 a month flat rate. Since I have been a strong advocate of Chelmsford Choice, the town’s electricity aggregation program that offers a contracted price negotiated by the town, he wanted to know if Inspire Clean Energy’s offer was a good one (in comparison to Chelmsford Choice). Also, we puzzled over how they computed the initial prices and wondered if they were able to see our National Grid bills.
I did a quick comparison with Chelmsford Choice’s 100% Green option, which has a supply rate of approximately 13 cents a kWh. At $129.99 a month, it would take 12,000 kWh per year (1560/.13) to break even. That would be a real bad deal for me because I only used about 5,000 kWh last year. On the other hand, the $64 a month offer, seemed pretty good. It would come to about 492 kWh a month. So, if you used a lot more, you would save a lot of money!
Really intrigued, I checked out the offer further. Although the letter said I could lock in the $129.99 rate, the fine print says to call or go to the website to receive your customized subscription price. Then it mentions that you might not qualify for the subscription offer. Also, that the flat rate is only good for 12 months. So, I went to the website with the URL from the glossy letter and entered the promo code, it still offered the $129.99 flat rate but wanted my National Grid account number. I stopped at that point. Obviously, I wouldn’t want to take the offer and lose money. When you enroll and give them your National Grid account number, you will probably be quoted a rate based on your actual usage.
Next, I did more investigating by playing around on their website. Went to inspirecleanenergy.com directly, saw all the buzz about climate change, and entered zip code 01824. Whereupon a notice that the average house in this zip is 1745 square feet and uses 586 kWh a month appeared and an offer of $95.44 a month was quoted. That would work out to 734 kWh a month at the 13 cents per kWh price. Wow, notice now, we have got three different flat monthly prices in the same zip code: $129.99, $64, and $94.44! I’ll bet everything hinges on what your NG account shows your actual usage to be. If it is way above average, the offer will change accordingly. Or you will be encouraged to take the fixed rate (not flat monthly price) of 13.39 cents per kWh. That is what I got when I tried the Customize Plan button and entered my street address.
This fixed rate of 13.39 cents per kWh is slightly more expensive than Chelmsford Choice’s rate of 13.015 cents. Also, looking at the Information Disclosure Label, it shows that their clean electricity is not all locally sourced, and some comes from outside the region. Probably Texas wind. Locally sourced RECs (renewable energy credits), which Chelmsford Choice delivers, are better.
So, the bottom line is that the current contract for Chelmsford Choice has a Greenest option that is better than Inspire Clean Energy’s fixed rate option. The Chelmsford Choice price is a little less and the electricity is guaranteed to be locally sourced. It is also fixed for longer than 12 months. Right now, there is more than 2 years left on the contract.
I can’t give a definitive answer on the flat monthly rate offers, since we would need a sample of customers taking the flat rate for the unlimited usage. The offers are all over the place. Inspire has a good idea what the usage is in this area, and you can’t be sure what you would really get until you pull the trigger. I’d caution that the promise of unrestricted usage at a cheaper price is just a hook to get you to bite. The promo says you can cancel anytime but the fine-print says you must go at least 2 months to get the 100 reward card.
If you want to figure out how good the unlimited usage flat monthly price is, you’d have to collect your electric bills for the last 12 months, add up the Total Supply Services charges, and divide by 12. While you are in there, note what supplier is named. If you are a direct National Grid customer, you will see “Basic Service Fixed” and no supplier name (since it is NG). If you are in Chelmsford Choice, you will see “Constellation – Chelmsford Choice” without any option name. You can tell which option you have by the rate: .13015 is for the Greenest option. Note, Inspire Clean Energy offers only one option: 100% clean. So, you would expect it to cost more than the basic service rate with National Grid. Finally, if you already have a competitive residential electricity supplier, like Inspire Clean Energy, you’ll see their name.
On August 3, 2021, the Lowell Sun’s editorial described legislation that would dismantle the competitive residential electricity supplier market, as it currently exists. Multiple studies have shown Massachusetts consumers who switched to a competitive supplier from July 2015 to June 2020 lost about $426 million. The chairs of key legislative committees, the Attorney General, and our own senator Michael Barrett are very concerned about this industry. Of course, not all competitive suppliers are unscrupulous. There are programs for “green energy” from groups like the Green Energy Consumers Alliance that would be hurt if the whole industry were banned. Some industry supporters advocate mandates that competitive suppliers show how their rates compare to the utilities and municipal aggregation alternatives (like Chelmsford Choice).
I would like to see Inspire Clean Energy give such comparison data. Until then, I recommend you join Chelmsford Choice, the electricity aggregation program that supplies electricity at a contracted price negotiated by the town based on bulk aggregation. Our Town Manager, the Select Board, and Energy Committee selected the Supplier (Constellation) based on the best contract they could get. Still there are many households in town that are not in the program.
Don’t fall for come-ons from the competitive electricity supplier market. Don’t get excited about unrestricted usage unless you really want to convert your carbon polluting devices to clean electric devices. But then after a year, what do you do?. If you want to save money, just use less electricity. If you want a known rate for a 3-year contract that is very competitive, just join Chelmsford Choice, the program vetted and offered by your own town. And if you want your electricity to be cleaner, just opt up to one of the Green options in Chelmsford Choice.