Ohio city energy program letter: should you opt out?

A letter arrives from your city, village, township or county. It talks about "aggregation" and says you will be signed up unless you "opt out." It can look like junk mail, or like something you have to do.

It is neither. It is a real program, and you get to choose. Here is what it means and how to decide.

What is this letter?

In Ohio, a local government can buy electricity or gas for a whole group of homes at once. This is called aggregation. The idea is that a big group can get a better deal than one home can alone.

The local government picks one supplier for the group. A supplier is the company that sets the price for the electricity or gas you use. Your utility (such as AEP Ohio, Ohio Edison, Columbia Gas of Ohio or Enbridge Gas Ohio) still brings the power or gas to your home, reads your meter and fixes outages. Nothing about your wires or pipes changes.

The letter tells you the price, how long it lasts, and how to say no if you don't want it.

What is the difference between opt-out and opt-in?

There are two kinds of programs:

• Opt-out: everyone in the area is signed up unless they say no. If you do nothing, you are in.
• Opt-in: no one is signed up unless they ask to join. If you do nothing, you stay where you are.

An opt-out program can't just appear. For electric, Ohio law says the question must go to the voters on the ballot, and a majority must approve it. The local government must also hold at least two public hearings first. (Ohio Revised Code 4928.20 (opens a new tab)) Gas programs also need a vote of the people. (Ohio Revised Code 4929.26 (opens a new tab))

So if you got an opt-out letter, your community voted for this at some point, maybe years ago.

How long do I have to answer?

Not long. The state's Energy Choice Ohio page on aggregation (opens a new tab) says people "usually have 14 to 21 days to respond" to the opt-out letter. The exact deadline is printed on your letter. Circle it on your calendar.

To opt out, follow the steps on the letter. Most often you mail back a form or call the number listed.

Do I get a second chance?

Yes. If you don't opt out, your utility will mail you its own letter saying you are being switched to the program's supplier. From the postmark on that letter, you have 7 days to call your utility and cancel with no penalty. (Energy Choice Ohio and the Ohio Consumers' Counsel (opens a new tab) both say this.)

If you miss both chances, you can still leave later. More on that below.

Who is left out of the program?

Two groups are not signed up on their own:

• People already with a supplier. If you already signed a contract with a supplier, you are not moved into the program. The Ohio Consumers' Counsel says you are welcome to join, but you have to contact your local government to do it. Check your current contract for a fee to leave first.
• People on PIPP Plus. PIPP Plus is Ohio's plan that bases your bill on your income. PIPP Plus customers are not eligible for these programs.

If you don't want offers from city electric programs at all, the state keeps an electric Do Not Aggregate list. Call the Public Utilities Commission of Ohio (PUCO) at 1-800-686-7826 to join it. Know that the PUCO posts the names and addresses on that list on its website.

Can I leave the program later? Is there a fee?

Yes, you can leave. Ohio law gives you a free way out on a regular schedule:

• Electric: you can opt out every three years without paying a switching fee.
• Gas: you can opt out every two years without paying a switching fee.

Between those times, it depends on the program's contract. The Ohio Consumers' Counsel says aggregation offers "often do not have a termination fee and may allow customers to leave the program at any time," but not always. Your letter should say. If it doesn't, call the supplier named on it and ask, "Is there a fee if I leave early?"

For more on fees, see early termination fees and how to leave a supplier.

Should I opt out or stay in?

It comes down to one question: is the program's price lower than your utility's standard price?

Your utility's standard price has a name:

• For electric, it is your Price to Compare. It is printed on your bill. I explain it in What is the Price to Compare on my Ohio electric bill?
• For gas, it is the Standard Choice Offer, or SCO. (Duke Energy Ohio calls its version the Standard Service Offer.) It changes every month. See why your Ohio gas price changes every month.

Then look at the program letter. Ask yourself:

1. What is the price? Is it lower than the standard price?
2. Is the price fixed or variable? A fixed price stays the same for the whole contract. A variable price can go up or down.
3. How long does it last? And what happens when it ends?
4. Is there a monthly fee? A small monthly fee can wipe out a small savings.
5. Is there a fee to leave early?

Keep in mind that the standard price moves too. Ohio electric standard prices can change several times a year, and gas changes every month. A program price that looks good in winter may look different by summer. That is why I look at more than one month when I compare.

The Ohio Consumers' Counsel says group buying has often brought good prices over time, but it also says plainly that joining "does not guarantee savings."

My rule of thumb: if the program price is clearly lower, has no fee to leave, and is fixed for a while, staying in is usually fine. If you can't tell, opt out, keep the standard price, and compare again later. You can always join an opt-in offer or pick a supplier yourself.

How do I find my town's program?

The state keeps a map of every city, village, township and county with an electric or gas program. You can find it through the Energy Choice Ohio aggregation page (opens a new tab). Your local government's website often has details too, including the current price and the supplier's name.

Not sure whether you are already in a program, or with a supplier at all? The supplier's name usually appears on your bill. See how to tell if you have an electric supplier. You can also compare the offers in your area on the state's Apples to Apples (opens a new tab) list, or read my guide to using Apples to Apples.

Who to call with questions

• Your local government: the phone number is on the letter.
• The Public Utilities Commission of Ohio (PUCO): 1-800-686-7826.
• The Ohio Consumers' Counsel: 1-877-742-5622.

What to do next

1. Find the deadline on your letter and write it down.
2. Find your Price to Compare (electric) or SCO (gas). Today's standard prices are on the Ohio page and on your utility's page, such as AEP Ohio, Ohio Edison, Duke Energy Ohio, Columbia Gas of Ohio or Enbridge Gas Ohio.
3. Run the free bill check. I compare what you pay now with the standard price and every offer listed for your area.
4. For more on city programs, see the Help page.