Officials in Granite City are hoping to use their bargaining power to negotiate cheaper electric rates for city residents.

The City Council last week named local attorney Eric Robertson to set up a program of asking for bids for electricity for residents who want to participate.

City leaders hope the Electric Aggregation Opt-Out Program, allowed by a change in state law that took effect Jan. 1, 2010, could bring savings to residents. The city has already saved money by negotiating with electric suppliers for powering its sewage treatment plant.

"I don't know that it's going to be $1,000 a year," Mayor Ed Hagnauer said. But, he said, "any savings is worth doing."

Before the city could set up the program, the City Council would have to adopt an ordinance saying it wants to take bids from suppliers for residential electricity. Voters would have to approve the opt-out program in a referendum in the spring.

"In today's electric market, there is a very, very good opportunity to reduce electric prices for folks who choose to be in this program," Robertson said. The city is paying Robertson $150 an hour.

The opt-out program can save people 15 percent to 20 percent, Robertson said.

Those who enter a new city residential electric program would not have to get new electric lines added to their home; Ameren Illinois Co. would still service existing power lines and respond to outages.

Since the late 1990s, the state has allowed large industrial users to negotiate with electricity suppliers. The users agree to buy electricity for a certain amount directly from the supplier through the existing electric grid.

For the past three years, the city has negotiated with suppliers for cheaper rates for its sewage treatment plant and other large facilities in the city. Robertson has represented the city in those negotiations.

That program has saved the city hundreds of thousands of dollars, Hagnauer said.

The new law allows municipalities to negotiate rates for groups of their residents, just as big users previously negotiated with electricity suppliers. The supplier or Ameren could send out bills.

Nineteen municipalities have approved ballot measures on the issue. Sixteen of them have picked suppliers and have enrolled residents. No municipalities in this area have started the program, according to a list provided by the Illinois Commerce Commission.

Residents don't have to wait to get a different electricity supplier. Information about opting out as an individual can be found online at pluginillinois.org.

Contact reporter Jim Merkel at 618-344-0264, ext. 138