The Board of Luas County Commissioners has received many inquiries from residents regarding the recent increase in household electricity bills. To help answer these questions and provide additional information, the Board invited Mark Frye, the President of Palmer Energy who helped form the Northwest Ohio Aggregation Coalition (NOAC), to present at a Commissioners meeting on October 7.

His presentation is archived and can be viewed via the Board's public portal, or you can read a summary of his presentation below:

More than 20 years ago, communities in Northwest Ohio chose to form a coalition to secure lower electric costs through community aggregation. The Northwest Ohio Aggregation Coalition (NOAC) has grown to a coalition of 15 communities: the Cities of Maumee, Northwood, Oregon, Perrysburg, Rossford, Sylvania, Toledo, and Waterville; the Villages of Delta, Holland, Ottawa Hills, and Walbridge; Lake and Perrysburg Townships (Wood County); and the Board of Lucas County Commissioners (representing the unincorporated areas of Lucas County). 

These efforts have been successful. The 120,000 households and small businesses that typically participate in the program have saved over $190 million compared to what they would have paid if they were not shopping for power. About $70 million of those savings occurred over the past three years as the communities fixed the aggregation pricing at 6.3¢ per kilowatt-hour while electric market pricing was increasing. Unfortunately, that three-year fixed price ended in May 2025.

Electric market conditions are much different than they were in 2022. The communities went out for pricing, and, after reviewing the various pricing offers, the communities decided that fixing one year was better than locking in at these extraordinarily high prices for a longer time. Since then, it appears there has been some market relief, but prices remain much higher than aggregation participants have seen in the past. So, the question is why? What is happening to create such a shift in the market?

There is no one thing to point to as the cause. Instead, there are multiple factors influencing the market.

One factor is electricity demand. When NOAC fixed its price in early 2022, electricity consumption had been flat for over a decade as conservation balanced out the increasing demand from new homes and businesses. That changed last year. Electricity consumption is expected to grow materially in the next decade. This has increased wholesale power prices.

More challenging is the shift in the supply and demand balance when it is hot. While additional power plants start up to supply the grid on those days, there are only so many plants. In the past 15 years numerous coal fired plants have been shut down while natural gas plants have been constructed to replace them. More recently, the industry has focused on building wind and solar facilities. When the peak demand stayed relatively flat, this was sufficient. No longer, as electricity demand growth is expected to be robust through 2050.

Much of this growth is from data centers, which need power 24 hours per day, seven days a week. A large data center uses enough electricity to supply every meter in the City of Toledo. So while the generation market was planning intermittent generation (e.g. wind and solar), a new demand area surfaced that needs 24/7 power. In short, new data center loads are stretching available generation, and electric generation capacity market prices have responded by increasing dramatically. Recognizing this challenge, data center developers are searching for locations that have sufficient access to natural gas supplies to build their own power plants.

You may ask why not turn the old plants back on? Why not build new gas fired plants faster? Many of the coal plants are too old to turn back on, or, in many cases, they have been leveled. Power plant developers are pivoting quickly to build new natural gas fired plants, but data center demands are worldwide, and the equipment needed to build them is in short supply. 

In summary, the NOAC communities are focused on controlling and reducing consumers' electricity costs as much as possible and will continue doing our best to achieve this objective in the future as electricity market pricing continues to change. Over the next few years, the market prices for electricity will likely remain high.

For more information about NOAC, read the Frequently Asked Questions page or visit their website at http://www.palmerenergy.com/NOAC.php.