With residents and small businesses in Massachusetts bracing for sharp increases in their electric bills this winter, several area communities are joining a regional effort to help bring them rate relief starting next year.
Norton and Freetown are among six cities and towns that have agreed so far to take part in the initiative organized by the Southeast Regional Planning and Economic Development District. The others are Acushnet, Dighton, Fall River, and Rehoboth. At least eight other communities, including Rochester, are considering joining.
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Provided it receives approval from the state Department of Public Utilities, the plan will take effect next spring. Under it, participating communities will together choose a common supplier to provide power to their residents at specified bid prices — prices that should represent a savings for them.
The prices will vary from community to community based on the duration of their contracts with the supplier – from one to three years — and how much of the power they want to come in the form of green energy. Unless they opt out, residents and small businesses will all be charged at the contracted prices for their community.
Cities and towns can enter into such municipal electric aggregation agreements with investor-owned utilities through a provision in the 1997 Massachusetts law that deregulated the state’s energy market.
“Aggregation offers a chance to go out and combine all local residents to get a better price, saving them some money,” said Ross Perry, director of municipal partnerships for SERPED, the regional planning agency. “And there is definitely an opportunity to lock in longer-term rates, so it’s much easier to budget.
“SERPED has gone a step further,’’ he continued. “This is not just aggregating one town. We have 13 communities that have said they have some level of interest in doing this. If all 13 were to come together, we would be going out to bid for 130,000 households and small businesses.”
He said the program also gives communities the opportunity to select how much green power to buy.
The participating municipalities recently chose the firm Good Energy to manage the program, including selecting suppliers and doing community outreach.
The program does not involve any added costs to either the communities or consumers. Good Energy will be compensated through a fee paid by the supplier equal to a tenth of a penny for every kilowatt hour purchased through the program, or about $7.50 to $9.50 per year for an average household.
NStar recently asked regulators for a 29 percent rate increase starting in January. It attributed the increase to the cost of supply, citing demands on its natural gas pipeline network. Earlier, National Grid won approval for a 37 percent winter price increase that began this month.
Norton agreed to join the initiative through a vote of its fall Town Meeting in October, town manager Michael Yunits said.
“It will reduce people’s electric bills and give them some stability, so you don’t have spikes in the winter like National Grid is doing this year,” he said.
Under deregulation, investor-owned utilities no longer supply the power they sell to consumers, instead purchasing it on the market. Consumers can select a supplier, but Perry said less than 5 percent of residents and no more than about 20 percent of small businesses have done so. Those who do not choose their own supplier use the one selected by their utility.
Perry said that the aggregation program removes a hurdle that may hinder consumers from choosing a supplier: the difficult task of evaluating which firm is offering the best deal.
Statewide, there are 19 approved municipal power aggregations, encompassing 39 cities and towns. Among them is a regional aggregation that covers 21 Cape Cod communities. Thirty-five other communities are seeking approval of their plans, according to Mary-Leah Assad, spokeswoman for the state Executive Office of Energy and Environmental Affairs. None of the approved or proposed aggregations are from this region.
Freetown was the first community to join the SERPED-led program when Town Meeting voted last June to participate, according to town administrator Jack Healey.
“We understand how important it is to have buying power,” Healey said. “If we all get together and aggregate our need for power, then we can go out and buy it cheaper and all share in the lesser cost. I applaud SERPED for having had the vision to initiate something like this.”
Rochester selectmen decided not to put an article before the Oct. 20 Special Town Meeting.
“They felt there was not enough time to fully explain the concept to residents prior to the meeting,” town administrator Michael W. McCue said by e-mail.
But he said selectmen are considering placing the matter before the annual Town Meeting next spring.
John Laidler can be reached at laidler@globe.com.