Blog : Our Town Energy Alliance Aims to Lower Individuals Fuel Payments

By | May 6, 2014 | in

BY HEIKKI (HERB) PERRY
Green Alliance Correspondent

BARNSTEAD, N.H. — Most people view their home-heating fuel options like they do a nightmare, feeling vulnerable to the vagaries of a volatile energy market, fearing they will be ripped off when they do buy fuel, therefore not knowing what to do.

By hitching their wagons to Our Town Energy Alliance (OTEA), however, consumers no longer face this challenge by themselves. Guided by a commitment to help New Englanders save money while reducing their environmental footprint, OTEA has grown from a small contingent of 75 members to a vibrant organization of roughly 10,000 in a little more than a decade.

From researching pricing plans to find optimal savings to offering a range of products designed to maximize energy efficiency to using only trusted fuel-oil vendors, OTEA is a trusted third-party voice that does the homework for the consumer.

Launched in 1999 by Dan and Cate Barraford, Our Town Energy Alliance started off as a cooperative for seniors looking to save money on home heating oil, propane and kerosene. In 2014, seniors still comprise 25 percent of OTEA’s customer base, benefitting from a special OTEA program that caters to their unique needs.

“One of the reasons we started the business was to help with escalating heating bills for seniors, and we also wanted to help young families. We have since expanded our services to small businesses and municipalities,” said Cate Barraford in a recent interview.

A family business, OTEA welcomed Cate Barraford’s son, Elliot Barraford, into the business in 2012, and her daughter, Julia Barraford-Temel, sits on the OTEA board.

How does a consumer get access to lower fuel prices? For a small membership fee, OTEA members pool their purchasing power as an energy buyers group to negotiate lower prices for oil, propane, and K1 fuels.

“Saving is easy with us,” Elliot Barraford said. “It’s a $25 signup to become an Our Town member, and members can save hundreds of dollars instantly. It’s really worth making the initial $25 investment with us as an insurance against price increases.”

Residential members pay $15 for each additional fuel source or location.

Businesses are charged $50 for their first fuel source or location and $20 for the second. OTEA charges nonprofits $40 to become members. And people who receive fuel assistance get free OTEA membership.

Our Town members will save money on fuel-oil costs: Based on the use of 750 gallons for a 2,500-square-foot-home, the savings on fuel oil during the 2013-14 winter heating season was $300.

Savings on propane fuel costs were even more dynamic this year. Our Town members who locked in to a fixed price program paid $2.13 per gallon for propane while the prevailing price averaged $3.69, a savings of 43 percent — or $1,248 that stays in your pocket on the purchase of 800 gallons of fuel.

“Propane produces our largest savings,” Elliot Barraford said, noting that propane savings typically vary from 90 cents to $1.50 per gallon — “we often say an average of a dollar a gallon” — so in a typical year with an average usage of 800 gallons, a consumer would save roughly $800 per year.

A propane fuel shortage this winter almost doubled prices this year, but Our Town vendors had huge supplies, so its members were never in danger of not getting fuel, and they had locked in at a much lower price.

“The savings are so easy with propane; if you use propane and don’t use OTEA, you’re just throwing money away,” Elliot Barraford said. “If you use propane, it’s a no-brainer to join us.”

“I continue to sing your praises to others and how happy I am to be a member of the Co-op,” said Roger Amadon of Loudon, N.H. “It does appear to be too good to be true, but I will assure anyone who calls or e-mails me, that it is true. And by the way, I used an average of 125 gallons of propane per week during this past year's cold winter months. Figure the math on those savings. Keep up the good work, and I can't wait to re-new my membership.”

Paul Stevens, a Belmont, N.H., resident, OTEA member and vocal proponent of OTEA for the purchasing of propane, noted that his billing process remains the same — that he still receives his propane from local vendors — but by being an Our Town member, he benefits from lower prices because Our Town negotiates with vendors on his behalf and everyone that lives in his area, so they get lower prices.

Sixty-five percent of Our Town members use propane, 32 percent use oil, the rest kerosene. Geographically, 92 percent of Our Town members live in New Hampshire, 5 percent do in Maine, 4 percent in Massachusetts, and 1 percent in Vermont.

While paying for propane is pay as you go, oil pre-buy is an up-front payment, which a lot of people cannot afford, Cate Barraford said. Our Town does offer budget plans available for 5 cents more a gallon. Otherwise, it can be a $3,000 to $4,000 upfront “pre-buy” made in the summer months.

Ensuring the lowest prices for customers is more art than science in the unpredictable oil market, Elliot Barraford explained. Our Town monitors the prices of fuels such as oil and propane; and, based upon its read of the market, goes to bid for the purchases in bulk at the time it believes will provide the most savings for its customers.

Since the market price for fuel could theoretically drop below the price Our Town negotiated for a large bulk buy, that kind of purchasing bears inherent risk. However, in 14 years of existence, OTEA has saved its customers money in 13 of those years, with just one year of breaking even, Elliot Barraford said.

Elliot Barraford also was careful to explain that, along with regional differences in prices based upon providers, individual usage also determines rates of savings. Someone who uses more propane than the average customer saves more per gallon than a customer who uses a lower than average amount.

Our Town only deals with fuel companies with long track records, firms proven to be reliable suppliers, eschewing vendors who might go under and close after customers buy supplies from them.

“We have never had a fuel company that has taken pre-buy money from customers and not delivered,” Cate Barraford said. “Every vendor that has taken pre-buy money has delivered fuel — every drop of it — every year.”

What’s more, OTEA has cultivated a unique partnership with area businesses, referring them to its members — and vice-versa with free ads on the OTEA Web site — with the goal of making sure even more of its members’ dollars stay in their town, county and state.

In the office, OTEA uses supplemental heat — wood pellets and a high-efficiency heat pump — and energy-efficient CFL bulbs to reduce its carbon foot print; it recycles all appropriate materials, including cans, bottles and ink cartridges; it posts news updates online, uses paperless banking and promotes paperless transactions; and it provides filtered, not bottled, water to employees to minimize plastic waste.

Our Town Energy Alliance is a Business Partner of the Green Alliance, a union of local sustainable businesses promoting environmentally sound business practices and a green co-op offering discounted green products and services to its members.

Our Town also offers the Intellicon, a microprocessor that attaches to a water heater or furnace that regulates the burn pattern to make it more efficient. Elliot Barraford said the product typically reduces fuel consumption by 10 to 20 percent and the manufacturer guarantee at least a 10 percent reduction in fuel usage. OTEA installed an Intellicon on its furnace in 2008 and monitored the reduced usage before endorsing and selling the product to members.

By championing strength in numbers, Our Town Energy Alliance is putting itself squarely at the forefront of energy choice in New England, giving members throughout the region a chance to lower their bill, minimize their environmental footprint, and help support the local economy.

“I am a single mom with a single income, and I would be happy to tell anyone that it is good and real,” Laura Wood, a resident of Center Barnstead, N.H. said about Our Town fuel-cost savings. “I love this program and would not have been nice and warm this past winter if it were not for this program.”

For more information about Our Town Energy Alliance, visit www.otchoice.com.

And for more information about the Green Alliance, visit www.greenalliance.biz.