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City electric rates to drop in 2011

October 27, 2009|By ANDREW SCHOTZ

HAGERSTOWN -- Electricity customers in Hagerstown are expected to save about 8 percent under a new contract extension with Allegheny Energy Supply.

The Hagerstown City Council on Tuesday approved the two-year extension, which will take effect June 1, 2011.

Under the extension, the rate per megawatt hour (MWh) in Hagerstown will drop to $64.85 from the current rate of $71.89.

The roughly 10 percent drop in the rate is not the same as the savings for customers, according to Michael S. Spiker, the city's director of utilities.

In an e-mail, Spiker wrote that the rate decrease is due to "market changes within the capacity futures market and energy futures market."

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The city currently has a five-year contract with Allegheny that expires on May 31, 2011.

Hagerstown and the towns of Williamsport and Thurmont, Md., jointly buy power from Allegheny to supply to their residents.

Williamsport and Thurmont also have agreed to contract extensions with Allegheny for the same time period.

The lower rates apply to customers who pay their bills directly to the municipalities. All three municipalities have different rates.

Williamsport's MWh will drop to $65.83 from the current rate of $73.40, according to Donnie Stotelmyer, the town's clerk/treasurer.

Thurmont's MWh will drop from to $65.04 from $74.05, according to Bill Blakeslee, the town's chief administrative officer.

In a voice-mail message, Allegheny spokesman Todd Meyers confirmed the new agreements, but said he couldn't talk specifically about them.

Front Royal, Va., used to be the fourth member of the municipal bargaining group, but went off on its own in 2005, the last time contracts were negotiated.

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