Recent reports by news media and others have stated that some towns (i.e. Cheshire, Waterford, and Wethersfield) have received a "raw deal" in the competitive electric market. In fact, the problems in these towns are with the vendor that serves the school board. The town governments in Cheshire and Waterford, for example, are served by CCM Energy and there are no problems.

These news reports (1) are not related to electric supply contracts procured through the CCM Energy program, a service program of the Connecticut Conference of Municipalities (CCM); and (2) do not reflect the cost-savings achieved by the more than 100 municipalities and school districts in CCM Energy's electric purchasing program.

According to Rudie Beers, Director of Finance for the Town of Waterford: "Contrary to some news reports, the Town has saved - because of CCM - about $139,000 in 2005-2006 and anticipates saving more than $250,000 in 2007 compared to utility pricing. We have been very impressed with CCM's professionalism, including their ongoing support during the term of our supply contract. CCM is always there when we need them."

CCM's program provides all the information needed by town and school officials to make an informed decision regarding the purchase of electricity in the competitive market. The cornerstone of our program is negotiating complete supply contracts with multiple bidders, reviewing those complete supply contracts with the community before seeking any prices, and then obtaining pricing from multiple bidders based on those fully negotiated supply contracts. This emphasis on complete negotiation of and review of supply contracts before requesting a price has several advantages.

• First, this approach maintains competitive pressure on the price until that price is finalized.
• Second, this approach maximizes the competitive pressure on the terms and conditions that underlie that price.
• Third, and most importantly, this up-front emphasis on the contract allows CCM to review the complete contract with the community, well before any bids are received. CCM's review with the community includes each contract's approach to pass through costs that will be added to the bid price.

Given the magnitude of new regulatory charges, CCM also insists on requesting two sets of prices from suppliers, one reflecting an "all in price" with no additional pass through costs, and the other allowing only those pass through costs previously negotiated with suppliers. We know of no better way to highlight and make transparent the potential magnitude of these charges.

The hallmark of the CCM Energy Purchasing Program is its emphasis upon contract negotiation and contract review with its member towns, cities, their school districts and local public agencies. CCM's objective is to put its members in the position of making well-informed contract decisions to save their taxpayers money.

The initial group of nine communities to join CCM Energy (the first in Connecticut to transition from utility-based pricing to the competitive electric market) will save $1,875,000 during the term of their current supply contracts as compared with the cost of utility-provided electricity. Every one of these nine communities has elected to use CCM's procurement program again to obtain a second multi-year electric supply contract. CCM Energy is the gold standard of electric purchasing programs in Connecticut.