Crain’s Chicago Business has shined a spotlight on a “green” plan offered by Ethical Electric, which has been CUB’s biggest source of questions this year among dozens of alternative electric and gas suppliers.
A direct mail piece by Ethical is short on detail on the plan’s actual cost, and how it compares to ComEd. The fine print says the price is 9.4 cents per kilowatt-hour (kWh)–but for just three months. Then it’s a variable rate that can change monthly.
The 9.4 cent initial price, by the way, is about 30 percent higher than ComEd’s current rate.
An Ethical Electric official says the company’s claim that customers will pay a “little more” is not deceptive. Still, electricity shoppers deserve to get complete and accurate info about any plan they’re considering, and we have a database full of people who were confused by Ethical’s pitch.
Generally, one big point of confusion among consumers is over what a “green” plan actually is. Signing up for green energy does NOT guarantee that energy from renewable sources—wind and solar farms—is being pumped into your home. According to CUB’s fact sheet on “green” plans, there’s just no easy way to determine if the electricity you’re constantly consuming is coming from a nuclear plant, wind turbine, a coal plant or any of the thousands of sources of power.
Instead signing up for a green offer means that you’re purchasing Renewable Energy Credits (RECs). So, for example, if you’re on a 100 percent renewable energy plan, as Ethical markets, it means that for every kWh of electricity you use the same amount of renewable energy is being added somewhere on the grid—not necessarily to your microwave.
CUB supports renewable energy. If consumers want to pay a premium for green power and they have full details on the pricing, they should be able to choose a green plan if they want. But don’t forget that the utilities have green power too. The state’s Renewable Portfolio Standard (RPS) requires Amer en and ComEd to supply a certain percentage of renewable energy (10 percent now, 25 percent by 2025). Just like with the alternative suppliers, RECs are purchased to help Illinois utilities comply with that law.
Also, you don’t have to pay more for electricity to do good for the environment. The best way to help the planet and your pocketbooks is by reducing your electricity consumption (energy efficiency!) and/or moving your electricity demand to off-peak hours. Here are two optional programs to do that:
CUB Energy Saver is a free online tool that’s filled with energy-saving actions you can take to cut your bill. Plus, it rewards you with restaurant and shopping gift cards.
Peak Time Savings, offered by ComEd, is a no-risk program that allows people with new digital electric meters to get a bill credit for reducing their energy usage during certain summer days. By reducing power usage during peak hours (usually hot summer afternoons), consumers can get a financial benefit, and they help reduce the need to run expensive, high-polluting power plants.
(Want to know more about programs that shift usage to off-peak times? Check out Real-Time Pricing, for ComEd customers, and Power Smart Pricing, for Ameren customers.)
Remember, having choice in the market means you–and not some sales pitch–determines how your home defines what it means to be “green.”