Community Choice Aggregation
Community Choice Aggregation (CCA), also known as Community Choice Energy (CCE), municipal aggregation, governmental aggregation, electricity aggregation, and community aggregation, is an alternative to the investor owned utility energy supply system in which local entities in the United States aggregate the buying power of individual customers within a defined jurisdiction in order to secure alternative energy supply contracts. The CCA chooses the power generation source on behalf of the consumers.
By aggregating purchasing power, they are able to create large contracts with generators, something individual buyers may be unable to do. The main goals of CCAs have been to either lower costs for consumers or to allow consumers greater control of their energy mix, mainly by offering "greener" generation portfolios than local utilities. In the United States, CCAs are currently possible in the states of Massachusetts, Ohio, California, Illinois, New Jersey, New York, and Rhode Island, and serve nearly 5% of Americans in over 1300 municipalities as of 2014.
- 1 How CCAs Function in Electricity Distribution
- 2 Renewable Energy Significance
- 3 Policy Basis for CCAs
- 4 Early days
- 5 Massachusetts
- 6 Ohio
- 7 California
- 7.1 Overview
- 7.2 New Renewable Development
- 7.3 Power Charge Indifference Adjustment
- 7.4 Procuring Power & The Role of Energy Marketers
- 7.5 Energy Resource Stability and Provider of Last Resort
- 7.6 Risks involved in power system fragmentation
- 7.7 Customer choice in California
- 7.8 CCA rates and consumer protection
- 7.9 Employment and Union Relations
- 7.9.1 Marin Clean Energy
- 7.9.2 Sonoma Clean Power
- 7.9.3 Lancaster Choice Energy
- 7.9.4 Peninsula Clean Energy
- 7.9.5 Silicon Valley Clean Energy
- 7.9.6 East Bay Community Energy
- 7.9.7 Monterey Bay Community Power
- 7.9.8 San Jose Clean Energy
- 7.9.9 Clean Power Alliance
- 7.9.10 San Diego CCA
- 7.9.11 California Community Choice Association
- 7.9.12 Emerging CCAs in California
- 8 Illinois
- 9 New Jersey
- 10 New York
- 11 Rhode Island
- 12 Advantages and Disadvantages
- 13 References
- 14 External links
How CCAs Function in Electricity Distribution
CCAs are local, not-for-profit, public agencies that take on the decision-making role about sources of energy for electricity generation. Once established, CCAs become the default service provider for the power mix delivered to customers. In a CCA service territory, the incumbent utility continues to own and maintain the transmission and distribution infrastructure, metering, and billing. The municipality initiating the CCA sets up a governing board, usually made up of local elected politicians who, because they lack expertise and experience in complicated scheduling and marketing transactions in energy markets, often hire professional third-party consultants, who are paid by the CCA customers. Additionally CCAs are challenged by a lack of established credit, which may inhibit purchasing power. For example, the Clean Power Alliance, in Los Angeles and Ventura Counties, began its existence with a $10 million loan from LA County. The loan, which was originally to have been repaid in 2017, has had its repayment deadline extended for the second time to 2020, costing the county a non-material loss of $250,000.
Renewable Energy Significance
CCAs have set a number of national green power and climate protection records while reducing power bills, a rare combination that has won National Renewable Energy Laboratory (NREL) and Environmental Protection Agency (EPA) recognition for achieving significantly higher renewable energy portfolios while maintaining rates that are competitive with conventional fossil and nuclear-based utility power. Several major U.S. population centers under CCA have switched to energy portfolios that are an order of magnitude greener than local utilities or other direct access providers, but charge no premium above utility or direct access rates. CCAs are therefore already conspicuous leaders in green power innovation, receiving U.S. Environmental Protection Agency's “green power leadership awards” for achievements in renewable energy (MCE Clean Energy; Oak Park, IL, Cincinnati, OH). By 2019 Sonoma Clean Power was providing 91% carbon-free power and had accepted 2,000 customers into its premium EverGreen Service, providing 100% renewable energy from local solar panels and geothermal plants. Additionally, it plans to own and manage six solar plans in the Petaluna area.
Only 13% of CCAs offer “green power,” as their primary focus is to reduce electrical power costs to their customers. California CCAs lead in offering renewable electricity because they are so required by state law. In New York state, about 50% of the only active CCA sales are green. An additional 90 CCAs in Illinois, Mass. and Ohio provide renewable energy; but most CCAs do not offer voluntary renewable energy as a default energy product.
Policy Basis for CCAs
In the US, CCAs are permitted in seven states: Massachusetts, Ohio, California, Illinois, New Jersey, New York, and Rhode Island, but are only present in the first six. States must first pass legislation allowing for the formation of CCAs before an aggregate can form. Currently, only states with electric deregulation have passed such legislation. This is a natural progression as electricity deregulation separates the functions of electricity generation from transmission and distribution allowing consumers to choose their electricity generator. This separation then allows for CCAs to choose the electricity generation mix on behalf of consumers without having to establish the infrastructure to move electricity. However, only 17 states and the District of Columbia have deregulated markets. The remaining 33 states are considered regulated, where utilities retain a monopoly on generation, transmission, and distribution of electric power.
|Legal Authorization for Community Choice Aggregation|
|State||Year||Authorizing Legislation||Authorizing Legislation Name|
|Massachusetts||1997||M.G.L. ch.93A §1||Utility Restructuring Act of 1997|
|Ohio||2001||Local Ballot Measure||N/A|
|California||2002||Assembly Bill 117||N/A|
|Illinois||2002 (residential)||220 ILCS 5/Art. XVI||Electric Service Customer Choice and Rate Relief Law of 1997|
|New Jersey||2003||Assembly Bill 2165||Government Energy Aggregation Act of 2003|
|New York||2016||PSC Case 14-M-0224||Order Authorizing Framework for Community Choice Aggregation Opt-Out Program|
|Rhode Island||1996||RIPUC No. 8124||Utility Restructuring Act of 1996|
In Massachusetts, where the nation's first CCA bill (Senate 447, Montigny) was first drafted by Massachusetts senate energy committee director Paul Douglas Fenn in 1995 and enacted in 1997, the locales of Cape Cod and Martha's Vineyard formed the Cape Light Compact and successfully lobbied for passage of the seminal CCA legislation. Two of the Cape Light Compact founders, Falmouth Selectman Matthew Patrick and Barnstable County Commissioner Rob O'Leary, were subsequently elected to the Massachusetts House of Representatives and Senate respectively. Between 1995 and 2000, Fenn formed the American Local Power Project and worked with Patrick to draft and pass similar laws in Ohio, New Jersey, and other states.
The nation's first CCA, the Cape Light Compact, currently serves 200,000 customers, running aggressive and transparent energy efficiency programs and installing solar installations on Cape Cod schools, fire stations and libraries.
In Ohio, the nation's largest CCA was formed in 2000 when the state legislature adopted a CCA law that formed the Northeast Ohio Public Energy Council (NOPEC), made up of approximately 500,000 customers in 112 cities and towns across 8 counties, procured a power supply contract that switched electric generation fuel supply from a mix of coal and nuclear power to a mix of natural gas and a small percentage of renewably powered electricity, and announced a 70% air pollution reduction in the region's power mix. Unlike California CCAs, NOPEC offers both electric power(510,000 customers) and natural gas (400,000 customers). The Council has grown to 228 communities in 14 counties.
In 2002, California State Legislature passed Assembly Bill 117, enabling CCA. The Bill allowed CCAs, and mandated that customers be automatically enrolled in their local CCA, with an option to opt out. The law also makes the clarification that, in California, CCAs are by legal definition not utilities, and are legally defined in California law as electric service providers.
In the early days of the California energy crisis, Paul Fenn, the Massachusetts Senate Energy Committee director who conducted the legal research and drafting of the original CCA legislation, formed Local Power Inc. and drafted new CCA legislation for California. In a campaign organized by Local Power, the City and County of San Francisco led Oakland, Berkeley, Marin County, and a group of Los Angeles municipalities in adopting resolutions asking for a state CCA law in response to the failure of California's deregulated electricity market. Fenn's bill was sponsored by then Assembly Member Carole Migden (D-San Francisco) in 2001, and the bill became law (AB117) in September 2002.
CCA formation in California was delayed by initial political opposition by the state's investor-owned utilities. In June 2010, Pacific Gas & Electric sponsored a proposition, Proposition 16, to make it more difficult for local entities to form either municipal utilities or CCAs by requiring a two-thirds vote of the electorate rather than a simple majority, for a public agency to enter the retail power business. Although PG&E contributed over $46 million in an effort to pass the initiative (Prop 16's opponents, led by Local Power Inc. and The Utility Reform Network, had access to less than $100,000), Proposition 16 was defeated.
San Francisco adopted a CCA Ordinance drafted by Fenn (86-04, Tom Ammiano) in 2004, creating a CCA program to build 360 Megawatts (MW) of solar, green distributed generation, wind generation, and energy efficiency and demand response to serve San Francisco ratepayers using solar bonds. Specifically, the ordinance combined the power purchasing authority of CCA with a revenue bond authority also developed by Fenn to expand the power of CCA, known as the H Bond Authority (San Francisco Charter Section 9.107.8, Ammiano), to allow the CCA to finance new green power infrastructure, worth approximately $1 Billion. In 2007 the City adopted a detailed CCA Plan also written primarily by Fenn (Ordinance 447-07, Ammiano and Mirkarimi), which established a 51% Renewable Portfolio Standard by 2017 for San Francisco. Over the following decade, Sonoma and San Francisco worked with Fenn's company, Local Power Inc. on program designs focused on achieving energy localization through renewables and energy efficiency.
Inspired by Climate Protection efforts, CCA has spread to cities throughout the Bay Area and the state. In 2007, 40 California local governments were in the process of exploring CCA, virtually all of them seeking to double, triple or quadruple the green power levels (Renewable Portfolio Standard, or "RPS) of the state's three Investor-Owned Utilities.
In April, 2014, Assemblymember Steve Bradford (D-Gardena) introduced legislation (AB 2145) that would sharply limit the ability of CCAs to enroll customers. CCA advocates and a broad coalition of local governments, business, and environmental organization rose up in opposition and defeated AB 2145. AB 2145 passed in the California Assembly but died in the Senate on August 30, 2014 when the Senate's legislative session was ended without it coming up for a vote.
New Renewable Development
The California Renewables Portfolio Standard (RPS) is a standard established by the the State of California that requires electricity service providers in the State to include certain minimum levels of defined renewable energy in their power mixes. In California all CCAs meet or exceed these minimum standards. (see page 8).
CCAs are well-regulated by their local governing boards, which are mostly made up of local government elected officials. In addition, CCAs must comply with State and federal regulations that apply to them. They engage with numerous state and federal agencies, including their regulatory overseer, the California Public Utilities Commission, and also the California Air Resources Board, California Energy Commission, and the Federal Energy Regulatory Commission. To date CCAs have an excellent record of compliance with renewable energy, grid reliability, and power content reporting requirements. CCAs work cooperatively with all agencies having authority over CCA operations to ensure efficient and safe delivery of energy and energy-related programs and strive to be highly responsive and transparent in their efforts to provide clean, affordable energy to our customers.
CCAs are well established in California with the first one having launched service in 2010. As of January 2020 there are now twenty operational CCAs in California serving over 10 million customers.. CCAs are responsible for over 3,000 megawatts of new renewable energy in California, including solar, wind, and bioenergy.. They are the primary procurers of California renewable energy portfolio-eligible renewable energy in the State.
All CCAs in California are entering into contracts for new renewables. In 2018, six of 19 California CCAs had Power Purchase Agreements for new renewables, accounting for approximately 10% of CCAs total load and 1.6% of California's total load assuming an average 30% capacity factor for all types of renewable technologies.
Power Charge Indifference Adjustment
Other issues that can arise from the development of community choice aggregation include the development of exit fees, specifically in the state of California. This is an issue for CCAs in the state of California because it allows Investor-owned utility (IOU) to raise prices through a Power Charge Indifference Adjustment (PCIA) or exit fee, making it more expensive for customers to join CCA programs because there will be a fee to customers when they choose to stop using bundled services provided by their utility provider and start using a CCA program. The exit fee, which typically is charged for 5 years, is applied to each kilowatt-hour of electricity consumed by the customer and shows up as a separate charge CCA customers’ monthly bills. In California, it has been difficult to determine the appropriate exit fee to customers who remain at the incumbent utility are not paying more than their fair share for these long term services, which has caused exit fees to change rapidly. Exit fees in Pacific Gas & Electric's service area decreased by 62 percent from 2012-2013, only to spike by 211 percent from 2013-2016 and increase again in a 2018 CPUC order. The main issues revolving PCIA is the transparency of the program, accountability of the agencies, and proper valuation of costs associated with the exit fees. Exit fees are put on CCA users to compensate for the cost that would be put on those remaining with IOU services.
The PCIA has tended to be very volatile and uncertain due to policy and regulatory debates on what level of exit fees is “fair” for both IOU and CCA customers. For instance, the PCIA for PG&E decreased by 62% from 2012-2013 and increased by 211% from 2013-2016.
Costs such as the exit fees and increased rates can be a disadvantage as CCAs can raise prices for customers. Rate setters and local officials can set CCA prices which can be a disadvantage if local government acts on their own self-interest or if local government lacks the knowledge to make decisions about CCA and prices in their localities.
In October 2018, after working on this issue for a year, the regulators at the CPUC announced their decision to continue and increase the cost of PCIAs to insure that IOU customers are not left with excessive energy costs due to the defection of customers to CCAs. The rate impact those leaving for CCAs was expected to be a 1.68% increase to those customers leaving PG&E; 2.5% increase on Southern California Edison defectors and 5.25% on customers departing SDG&E. The choice to opt out can be a benefit for customer choice but it can also be a risk for CCA programs because if there are many customers choosing to opt out of the services, this can result in financial instability among the CCA.
Procuring Power & The Role of Energy Marketers
Many Community Choice Aggregators hire third-party consultants with experience in energy markets to procure and schedule power and buy most, if not all, their power from energy service suppliers or independent power producers. This is necessary to meet the power needs of their communities and because many CCAs have no or low credit ratings; as such they are not able to finance the building of their own generation assets. This is changing; in 2019 Moody's assigned a first-time Baa2 issuer rating to the Peninsula Clean Energy Authority.
One of the advantages a CCA can offer is its focus on local jobs creation and support of local energy resources. But, because of the mandate to provide power at a low cost, CCAs in California have by necessity contracted with multinational and fossil-fuel reliant corporations such as Shell, Calpine Energy Direct Energy and Constellation (a subsidiary of Exelon) and from other CCAs. In 2018 and 2019 MCE executed contracts for the purchase of system energy with Shell Energy North America ($38M), Exelon ($19M), and Morgan Stanley Capital Group ($32M) for a total of $72 million, to be delivered 2019-2022.
One of the state's newer CCAs (2018) Monterey Bay Community Power has contracted with Shell, PG&E and 12 other major energy suppliers throughout the west, because power is a commodity and must be managed as such. Monterey Bay's main criterion is that all power it purchases must be carbon-free, so most of it is hydroelectric.
Energy Resource Stability and Provider of Last Resort
As of 2017, CCAs in California have some resource adequacy requirements, but the incumbent utility remains the Provider of Last Resort (POLR). As CCAs proliferate in California, there is debate and concern over who takes on the POLR responsibility if a CCA fails. Some investor-owned utilities have indicated a desire to stop purchasing and selling electricity, and if incumbent utilities are no longer in the business of providing power, it may no longer be feasible for them to provide this backstop. Individual CCAs differ on whether they want to or are capable of taking on this responsibility.
The CPUC has released a study called the “Green Book,” which is reminiscent of the agency's “Blue” and “Yellow” Books in 1993, which led to California's deregulation and subsequent energy crisis in the early 2000s. The substance of the “Green Book” is to call for thoughtful and comprehensive energy planning to help the state both meet its renewable source energy goals and avoid the turmoil of deregulated and fragmented energy supplies and suppliers.
There are crucial trends, pointed out the CPUC, that threaten California's three pillars of energy policy: reliability, affordability and deep decarbonization. The first trend revolves on fragmented decision making. Nine CCAs provided energy to consumers in 2017; there are 19 today. By the mid-2020s, 85% of power in California could be provided by new entities, different from those providing power in 2019. Trend two is poorly planned and organized procurement of the resources needed to ensure reliability. The third trend is ignoring the potential that customers might lose power service if their electric provider fails, as did some in the crisis of the early 2000s. Critics responded that grim predictions and unclear recommendations in the Green Book are not substantiated.
Risks involved in power system fragmentation
System fragmentation puts the state closer to a reliability risk of not meeting its clean energy targets: California has 40 Load Serving Entities, which include 19 CCAs. The rise of CCAs has fractured the role of California's three big regulated utilities as the primary providers of the state's grid reliability needs, and CCAs are not doing the type of resource adequacy planning needed to keep the system stable as it decarbonizes.
As the state's energy system becomes increasingly fragmented, regulators and policy makers are expressing concerns about resource adequacy to keep the system reliable and whether the state will meet its goal to have 100% clean energy by 2045. A recent report from a California administrative law judge analyzing Integrated Resources Plans done by all load serving entities noted that: “Because the majority of new resources in California are expected to be acquired by CCAs in the next decade, this puts additional focus on their contributions to the IRP process. Very concerning overall is the attitude displayed by some CCAs with respect to the IRP process in general. Several CCAs asserted the primacy of their voluntary plans approved by their local governing boards over the Commission’s IRP process, and argued that the Commission’s IRP processes do not fit with their individual resource procurement plans. This demonstrates the crux of the problem the State will face in coming years as more and more load is served by non-IOU, and specifically CCA, providers.”
The issue has become so pressing that the California Legislature is considering a bill (AB 56, in committee in September 2019) to give the CPUC the ability to task an existing state agency to serve as a backstop for procurement of electricity to meet the state's climate, clean energy, and reliability goals.
Customer choice in California
California CCAs typically offer customers several energy programs to choose from - a default program (Usually an energy mix similar to that provided by the incumbent utility), a program based on solar energy and a more expensive, 100% Renewable program. This renewable program is backed by unbundled Renewable Energy Credits (the customers cannot link the power they are buying to a specific renewable resource.). In 2018, these programs ranged from 37% to 100% renewable, with a statewide average of 52 percent. CCAs may also offer solar rebates and net metering, and some provide electric vehicle rebates for income-qualifying customers.
Some of the offerings by CCAs may meet the standards set by Green- E. For example, Marin Clean Energy offers a “Light Green,” a “Deep Green,” and “Local Sol Program” where only the Deep Green and Local Sol options are Green- E certified. Green-e certified are programs that are regulated and determined to meet a specific criteria and standards established by Green- E, developed by the nonprofit organization Center for Resource Solutions.
CCA rates and consumer protection
Whether a CCA offers lower or higher rates than its incumbent utility is based on the size of the PCIA (exit fee), whether the incumbent utility changes its rates, and the specific “Renewable Energy” package the customer wants. CCA websites usually compare the CCA's rates to that the incumbent utility. For example, Clean Power Alliance 2019 rates are 1-2% cheaper (for the 36% clean power) than Southern California Edison and 7-9% higher (if customers choose the 100% clean power, which uses unbundled Renewable Energy Credits).
The CPUC cannot adjudicate customer complaints between CCAs and customers because they do not have oversight over the CCA on consumer protection issues. This responsibility falls with the CCA Board of Directors. In addition, given that CCAs are not regulated through the CPUC like IOUs, there is no visibility regarding cost allocations amongst different customer classes.
Marin County Energy offers 10 different rate packages. When comparing its E-1 package with that of PG&E, the MCE Light Green (50% renewable) rate is .047% (six cents) cheaper than the PG&E rate. If the customer chooses the MCE Deep Green (100% renewable) package, the PG&G Solarchoice (100% renewable) package is 1.2% ($1.63) less than the MCE rate. The nine other MCE packages compare closely.
Employment and Union Relations
Labor unions have criticized CCAs for not supporting and instigating local job growth, reducing union jobs, and contracting with power providers who use non-union labor. CCAs tend to employ fewer employees than IOUs and contracts with large multinational corporations are primarily fulfilled through the use of non-union labor. For example, The Western Labor and Management Public Affairs Committee (Western LAMPC) has raised concerns about CCAs in California and their relationships with union labor. The committee censured MCE for its contracts with large, multi-national energy providers like Shell, stating that MCE purchases most of its energy from out-of-state non-union corporations. It also reprimanded Sonoma Clean Power for its contracts with Constellation Power and Sonoma's unwillingness to provide firm commitments to local projects.
San Diego's two locals of the International Brotherhood of Electrical Workers (IBEW) have expressed concern over the possible loss of union jobs as San Diego forms its own, new CCA. The union wants union-scale wages, involvement in any construction projects and an opportunity to unionize workers in the new CCA. Electrical union workers in the Los Angeles area have approved the CCA concept, as long as union jobs remain available.
===California CCAs=== (In order of date of service launch)
Marin Clean Energy
Marin County launched California's first CCA program, Marin Clean Energy, on May 7, 2010, offering 50%-100% renewable energy at competitive prices. Marin Clean Energy (MCE) now serves approximately 470,000 customers in Marin and Napa counties, Contra Costa County, plus the municipalities of Benicia, Concord, Danville, El Cerrito, Lafayette, Martinez, Moraga, Oakley, Pinole, Pittsburg, Richmond, San Pablo, San Ramon, and Walnut Creek.
MCE's mission is to take on climate change and reduce greenhouse gas emission by providing renewable and efficient energy to its customers at a stable, competitive rate. The organization also works to provide employment and economic advantages in its service area.
Sonoma Clean Power
The Sonoma County-based Center for Climate Protection formally introduced the idea of pursuing CCA in Sonoma County in the 2008 Community Climate Action Plan. In 2011, the Sonoma County Water Agency funded the production of a feasibility study to study the question. The feasibility study was favorable and after much public review and the formation of a Joint Powers Authority to administer the agency, Sonoma Clean Power launched service on May 1, 2014 offering power that is both greener and more locally sourced, at a lower cost than incumbent utility PG&E. The County and all eight eligible cities in the county eventually joined. This includes Cloverdale, Cotati, Petaluma, Rohnert Park, Santa Rosa, Sebastopol, Sonoma, and Windsor.
In 2016 Mendocino County voted to join Sonoma Clean Power and the Sonoma Clean Power governing board voted to accept Mendocino County and the cities of Fort Bragg, Willits, and Point Arena into the Joint Powers Authority.
Lancaster Choice Energy
Lancaster Choice Energy (LCE) began providing renewable power to municipal accounts in May 2015 with broad public enrollment beginning in October. So far[when?] the city of Lancaster, California has offset almost 70% of its peak load (147 megawatts) with renewable sources of energy. Lancaster aims to become the first net-zero city in the U.S., Lancaster is determined to generate more clean energy than it consumes, along with several private-sector partners. The City has established new rules for building more efficient, sustainable structures.
As of the end of its first full year of operations in 2016 Lancaster Choice Energy had 55,000 accounts in the City of Lancaster. LCE customers receive a minimum of 36% renewable energy through the standard Clear Choice product, with many opting up to 100% renewable Smart Choice. In addition, LCE's first solar energy plant is now live. Built by sPower, the plant provides 10 MW of power produced in Lancaster directly for Lancaster residents and is enough to power approximately 1,800 homes.
Peninsula Clean Energy
Peninsula Clean Energy (PCE) (https://www.peninsulacleanenergy.com/) was formed in February 2016 by unanimous votes of the County of San Mateo and all 20 incorporated cities and towns in the County. It began supplying power to customers in the Fall of 2016 and is currently the largest community choice energy program in California.
As of June 2017 it was offering its customers a baseline product that is both cleaner (at least 50% renewable and 75% greenhouse gas free) and at a lower cost than the incumbent utility, PG&E. As of June 2017 it was also offering its customers a 100% renewable product that was significantly less expensive than PG&E's 100% renewable product.
Silicon Valley Clean Energy
Silicon Valley Clean Energy (SVCE) launched its operation on April 3, 2017 by providing 100% GHG free electricity to 12 Silicon Valley communities, including Campbell, Cupertino, Gilroy, Los Altos, Los Altos Hills, Los Gatos, Monte Sereno, Morgan Hill, Mountain View, Saratoga, Sunnyvale and unincorporated County of Santa Clara. https://www.svcleanenergy.org/about-us
East Bay Community Energy
East Bay Community Energy, also abbreviated EBCE, ebce.org, was formed in October 2016 by Alameda County and the cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Oakland, Piedmont, San Leandro, and Union City. East Bay Community Energy began providing electricity in June 2018 for commercial and municipal customers and November 2018 for residential customers.
EBCE offers customers three energy services. Their Bright Choice service uses a slightly larger amount of clean energy sources as Pacific Gas and Electric Company (PG&E) but it costs less. Their Brilliant 100 option service is greener (100% carbon-free) and uses more renewable energy than PG&E electricity at the same price. A third service is their Renewable 100 option which uses 100% renewable energy and is offered at a cost just above the PG&E rate.
Monterey Bay Community Power
Monterey Bay Community Power (MBCP) procures carbon-free electricity for nearly 800,000 people in Monterey, San Benito, and Santa Cruz Counties, including all cities except Del Rey Oaks and King City which chose not to participate. MBCP began serving commercial customers in March 2018, with residential service beginning July 2018. MBCP matches PG&E rates and by default offers a 3% rebate on generation charges. MBCP is the 3rd oldest CCA in California, the only multi-county CCA in California, and geographically is the largest. https://www.mbcommunitypower.org/
San Jose Clean Energy
On May 16, 2017 San Jose City council approved the creation of San Jose Clean Energy, making San Jose the largest city in California to adopt a CCA.
Clean Power Alliance
Formed in 2017, a new CCA opened in February 2019 in Los Angeles and Ventura counties in Southern California. The Clean Power Alliance will provide electrical energy to residents of 29 cities and unincorporated parts of the counties. Cities like Los Angeles, Burbank, and Glendale who have municipal utilities, will remain with their local energy source.
Clean Power Alliance provides three rate plans to its customers, all varying in renewable sources of energy. Plan one offers 36% renewable at a cost 1% cheaper than Southern California Edison (SCE). The second plan has 50% renewable energy and is the same cost as SCE; the third provides 100% renewable power at a cost 9% higher than SCE. All the rates are set by the CPA board, whose 31 directors represent each city and county served.
San Diego CCA
In 2019, the city council of San Diego voted to develop a CCA that would provide electric power to San Diego, as well as Chula Vista, La Mesa, Encinitas and Imperial Beach CA. The city hopes that the CCA, which will be the second largest in the state after Los Angeles’ Clean Power Alliance, will be operational by 2021. The not-yet-named CCA expects to offer its customers rates about 5% lower than those of IOU San Diego Gas and Electric. Program supporters say the CCA will provide green sources of power at rates lower or equal to those of SDG&E. This is critical as San Diego's climate plan calls for 100% renewable energy by 2035; more ambitious than the state of California's by ten years.
Critics of the CCA say cities have little or no experience in purchasing or generating electricity and the unpredictable nature of the energy industry can lead to volatility and chaotic conditions. Unions find the plan “labor weak;” the Sierra Club commented that the CCA should insure that nuclear and fossil fuel energy be completely excluded from the CCA's energy procurement.
California Community Choice Association
In 2016 the six existing Community Choice agencies: MCE Clean Energy, Sonoma Clean Power, Lancaster Choice Energy, CleanPowerSF, Peninsula Clean Energy, and Silicon Valley Clean Energy formed a 501(c)(6) non-profit trade association, the California Community Choice Association, Cal-CCA. Cal-CCA held its first meeting in San Francisco on October 20, 2016.
According to the Clean Power Exchange, a project of the Center for Climate Protection that tracks Community Choice expansion in California, by the close of 2016, 26 of the 58 counties in California either had operating CCAs, were on schedule to launch service, or were at some earlier stage of evaluation. Over 300 cities are similarly engaged in operational or emerging CCAs.
Emerging CCAs in California
Multiple cities across the state of California are considering the implementation of Community Choice aggregation programs across their districts, and many will begin to launch their program in 2018. California has many cities who are anticipated to launch CCAs in 2018, this includes Placer County and Alameda County. There are also other cities who are exploring and in the process of implementing CCA, this includes Fresno County, and San Luis Obispo County.
The state of Illinois adopted a CCA law in 2009, which has led to an increase of communities providing electricity services to over 2/3 of the state's population as of 2014, including the city of Chicago, whose mayor Rahm Emanuel is focusing the program on reducing coal power production and increasing renewable energy.
As of October 2013, 671 Illinois cities and towns (representing 80% of the state's residential electricity market) have utilized CCA.
By the end of 2013, 91 local governments in Illinois (representing 1.7 million state residents) used the state's 2009 CCA law to purchase 100% renewable electricity for their communities.
Savings through the Illinois CCAs were at their best in 2013, when customers saved over $250 million, but fixed-price contracts with providers expired and rates leveled. In summer 2016 114 communities dropped or suspended their CCA programs. The biggest change was in Chicago where the initial sign-up for the program was 750,000 homes – almost two million people. In 2015, most returned to their original utility power supplier.
When Illinois' CCAs began, cost savings were guaranteed by law, with aggregators saving 30% below fixed utility prices during a transitional period when utility default rates were frozen to allow retail marketers to get started. Total CCA savings peaked in 2013, with CCA customers saving $258 million compared to ComEd's default rate. However, once ComEd's fixed price contracts started to expire and rates fell closer to market prices, short-term contracts set prices like those of competitive energy suppliers. As a result, many of Illinois’ CCAs were not saving money, resulting in CCA customers spending $188 million more than the incumbent utility's default rate over a two-year timeframe.
New Jersey adopted a CCA law in 2003, but did not see active formation of aggregations until 2013, when Bergen County, Passaic County, and fifteen other cities and counties started CCA programs, focused on both lowering electric bills and in some cases greening their power supply, or both.
The New York State Public Service Commission (PSC) has identified CCA as consistent with the stated goals of the regulatory reform "Reforming the Energy Vision” (REV), and has stated that local energy planning helps municipalities benefit from distributed energy resources enabled by REV. CCA legislation had been filed in the New York State Assembly in February 2014, followed by Governor Andrew Cuomo's order directing the PSC to implement CCA directly under its own authority in December 2014.
In December 2014, non-profit organization Sustainable Westchester submitted a petition to the PSC on behalf of its member municipalities to implement a CCA demonstration program in Westchester County. The PSC granted the Order on February 26, 2015 authorizing Sustainable Westchester to put out an RFP and award contracts for both electric and natural gas supply for residents and small businesses within municipalities in the county that pass a resolution to join the CCA: "The Sustainable Westchester pilot is expected to provide valuable experience on CCA design and outcomes that, in addition to the many comments in that proceeding, will assist the Commission in making a determination on statewide implementation of CCA."
The program launched in 2015, becoming the first operational CCA in New York State. Similar local CCA organizing efforts are underway in Ulster County, Sullivan County, Hudson Highlands, and other communities.
The Utility Restructuring Act of 1996 deregulated the utility market within Rhode Island, allowing consumers to choose their electricity generation supplier and CCAs to form. While this act allowed for the creation of CCAs, there are currently no residential or small business CCAs available for private consumers to join. The only CCA option is for municipal facilities.
Rhode Island Energy Aggregation Program (REAP)
The Reap program “is operated by the Rhode Island League of Cities & Towns and serves 36 of Rhode Island’s 39 municipalities and four school districts”. The Reap program facilitated the purchase of electricity by the municipal entity by submitting requests for proposals, reviewing bids from approved electricity generators, and selecting companies that they believe will be the ideal provider for each municipality. The program reported in 2012 it had achieved cost savings of 20-30% over the standard offer.
Advantages and Disadvantages
There are advantages and disadvantages associated with the implementation of Community Choice Aggregation across different localities. CCA provides benefits like providing a customer choice, reduced energy costs, renewable energy, and environmental benefits.
By providing customer choice, customers have the ability to be enrolled in CCA or maintain their current utility provider. Customers are automatically enrolled in the program but they can choose to opt out of it. CCAs reduce energy costs, lowering rates for customers. This also increases the use of affordable renewable energy, provided through wind, solar, and geothermal steam. This provides environmental benefits for communities because it reduces natural gas consumption and greenhouse gas emissions.
There are also disadvantages associated with the implementation of CCAs. Potential issues associated with the implementation include political and financial obstacles. CCAs can encounter groups lobbying against its implementation, setbacks from IOUs, exit fees, and even disadvantages associated with the opt out choices.
On the political level, local government can be opposed by groups and organizations. An example of this is when the IOU Pacific Gas and Electric Company opposed the creation of CCA by supporting California Proposition 16 in 2010, which would had made it difficult for California to implement CCAs across the state. Another utility provider who took action was San Diego Gas & Electric who attempted to stop local government from implementing CCA programs. SDG&E created a separate entity, that would allow them to lobby against CCAs in San Diego County.
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