AUBURN – A local company is pioneering a new way to lower its electric bill by buying its power wholesale.

Morin Brick Co. is the first company in Maine to purchase electricity as a wholesaler from the New England Power Pool. A change in federal law that took effect last March permits companies to buy power directly from the wholesale market. That market had been previously restricted to major power industry players, such as utilities, generators and transmission companies.

“It’s like buying in a box store,” said Gus Fromuth of Freedom Energy, the New Hampshire-based company that will act as an agent for Morin’s electricity purchases. “You’re getting the bulk price for a product that goes through a lot of markup before it gets to the consumer.”

As a result, Morin Brick is paying less for its electrical power. Norm Davis, treasurer for the company, said he’s predicting a savings, but declined to say how much.

“It’s hard to say,” he said. “It depends on how much off-peak power we buy.”

Fromuth said his studies show about a 15 to 18 percent savings between buying wholesale and buying at the standard market offer.

The brick-making company is one of the top energy consumers in Maine, said Davis. It uses electricity to ignite furnaces in its kilns, which operate around the clock.

By buying wholesale, Morin can purchase power off-peak at significantly lower rates. Because Maine generates about twice as much electricity as it consumes, it generally has a lower wholesale price, said Fromuth. On Dec. 2, Maine’s wholesale price was 4.9 cents per kilowatt hour compared with Connecticut’s 5.4 cents rate.

Volatile market

To get access to the wholesale market, Morin Brick had to form its own energy company, Morin Energy LLC, which received a license from the Maine Public Utilities Commission to purchase power wholesale.

It is subject to the same regulations as other energy providers in areas such as financial security, technical capability and consumer protection, even though the manufacturer will be its only power user.

“This is the only one we’ve done so far,” said Phil Lindley, PUC spokesman of the license approval. “No one’s asked before, and it’s hard to tell if anyone will follow their example.”

Lindley said buying power directly from NEPOOL could expose a company to market fluctuations that change hourly. Since electricity is produced and consumed nearly instantaneously, adjustments between supply and demand are continuous, and prices reflect that volatility.

Fromuth said Morin will be getting its electricity from a variety of NEPOOL wholesale markets that include the spot market – which changes the most – and other markets that offer more stable pricing options.

Davis said Morin Brick is always on the lookout for ways to lower production costs. About five years ago it installed a 1.5-mile pipeline to link up with a new natural gas pipeline.

“Electricity and fuel are a huge part of our production costs,” said Davis.

The company is in the middle of an expansion at its Danville Junction Road plant that it hopes to complete by spring. When finished, the company will double its electricity consumption as it produces between 1.5 and 2 million bricks per month.

Morin Brick is one of only three brick makers left in New England. At one time there were 100 such companies in Maine alone, said Davis.

“We came here in 1912 and chose to stay,” he said.