By David Harry

Staff Writer

South Portland’s idea to buy electric power in bulk will get a wider audience next week in Cape Elizabeth. 

Councilors and officials from Cape Elizabeth and Scarborough will join their South Portland counterparts Feb. 17 to discuss the creation of a nonprofit company to buy electric power for residents and municipal use. 

Cape Elizabeth Town Manager Mike McGovern and Scarborough Town Manager Tom Hall are eager to learn about the idea, which was endorsed last fall by South Portland city councilors in an energy sustainability resolution.

“I am looking forward to the joint meeting when we will have the opportunity to consider the advantages and risks of such a program,” McGovern said. The meeting will begin at 7 p.m. in Cape Elizabeth Town Hall.

South Portland Assistant City Manager Erik Carson and Ann Archino-Howe, the city sustainability coordinator, envision a nonprofit company that could buy power in bulk from ISO New England. ISO New England is a regional transmission organization that oversees the retail power generation market and transmission of power, according to its website.

Carson said research indicates consumers could save 8 to 10 percent on their power through the proposed cooperative, or an annual savings of $80 to $100. Rates charged by CMP to deliver the power would not be affected.

Buying power at wholesale rates bypasses the standard offer negotiated for consumers by the Maine Public Utilities Commission, Carson said. Savings that exceed more than the anticipated 8 percent to 10 percent could be used to pay for larger municipal energy conservation projects, Hall and Carson said.

The concept of buying blocks of electrical power emerged when South Portland officials considered building a power plant to help larger companies such as National Semiconductor and Fairchild Semiconductor reduce energy costs and keep jobs in the city, Carson said. 

After Maine’s 1996 deregulation of utilities, more power-generating companies appeared on the market and Central Maine Power reduced its role to transmission of power to customers, he said.

CMP spokesman Gail Rice said the utility has nearly 13,000 accounts in South Portland, 10,000 in Scarborough and about 4,200 in Cape Elizabeth.

Hall said he embraces the idea of selling power to residents and businesses although some may question whether it is a proper role for local government.

While Scarborough’s energy committee has discussed the idea of a cooperative, Hall said he had initial reservations about the concept.

“I thought the politics might get too complicated,” Hall said, but he now believes the regional collaboration could benefit residents.

“I’m not going to say tax bills will go down,” Hall said, “but can the cooperative have savings to help fund other projects?”

Carson said it is too early to determine how many consumers would need to sign up to get the program going. He said 15 percent of surveys sent to 9,000 residents were returned and none opposed the idea.

The estimated $500,000 in startup costs would come from city tax increment finance accounts, which requires approval from the Maine Department of Community and Economic Development. The department has the authority to approve municipal TIF zones that divert increased property taxes in certain areas to accounts that fund municipal projects and infrastructure improvements such as sidewalks or sewers.

Customers who sign up would not see a change in how they are billed for electricity, Carson said. The utility bill would remain split into sections for the power and its transmission.

If local councilors approve development of a cooperative, an interlocal agreement would be created similar to one approved by officials in Portland, South Portland, Scarborough and Westbrook to administer cleanup of Long Creek near Maine Mall, Carson said.

Carson said the cooperative would need to be licensed by the PUC and he anticipates two staffers would be needed to oversee operations.

Hall said a key to success will come from attracting customers.

“I think it is really exciting, the service could save money. But a key to success is volume,” Hall said.

Staff Writer David Harry can be reached at 282-4337, ext. 219.