Power Price Increases in Washington DC – Effective March 22nd 2019January 29, 2019
You may have a business with energy contracts that are expiring in the next 12-24 months in the DC area. These buildings need to contract prior to the beginning of March 2019 to save significant revenue in incremental electricity costs. This short timeline is the result of DC Bill B22-0904, the Clean Energy DC Omnibus Amendment Act of 2018 (http://lims.dccouncil.us/Legislation/B22-0904?FromSearchResults=true).
Passed by the DC Council on December 18, 2018 and signed by the Mayor of DC as of January 18th, the law mandates that 100% of electricity sold in DC comes from renewable energy sources by 2032, up from 50% as established in 2016. Since renewable power, particularly solar power, is more expensive than non-renewable power, this bill will increase buildings’ energy costs by between $0.0025/kWh and $0.005/kWh. The bill includes a “grandfathering provision”. This provision states that for three years after January 1, 2019, the higher renewable procurement levels will not apply to contracts “entered into before the effective date of the CleanEnergy Act”. The effective date of the CleanEnergy Act depends on when the bill is transmitted to Congress. To be safe, we should assume that the bill is effective on or before March 22nd, 2019.
Example: 9,500,000 kWh building with contract ending 12/01/2019
- 9,500,000 kWh/year * $0.0025/kWh = $23,750/Year * 3 year contract = $71,250 in savings
- 9,500,000 kWh/year * $0.005/kWh = $47,500/Year * 3 year contract = $142,500 total savings
In the example above, if this business does not sign a new energy contract before March 22, 2019, they would face the incremental cost of the renewable purchases for the period from December 2019 through December 2022. This can be avoided by contracting in the next month, which would guarantee savings between $71k – $142k.
This strategy coupled with our “Live Reverse Auction” process will yield the lowest prices available in the market today.
Please call 862-210-8770 to get more information on how this change affects your properties.
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