ORIGINAL REPORTING: Customer Demand For New Energy Is Driving Change
As utilities match CCAs on price, aggregators increase climate action, grow economies of scale to compete; Community choice aggregation is taking on utilities by tackling the climate crisis and going green
Herman K. Trabish, May 4, 2021 (Utility Dive)
Editor’s note: Customers continue to migrate to CCAs to obtain access to New Energy.
Community choice aggregations (CCAs), once seen primarily as a way for customers to lower their utility bills, are responding to new competitive prices from utilities by stressing their value in the energy transition.
Nine states have CCA-enabling legislation allowing local governments to form a power providing organization for their residents. In some of those states, CCAs are serving significant numbers of former investor-owned utility (IOU) customers. But as utilities turn to low cost natural gas and renewables to keep prices down, CCAs have begun using customer demand for ambitious climate action to stay competitive, data shows.
"Aggregation has become a tool that supplements state mandates to reach even higher levels of renewables than utilities," said former Massachusetts Department of Public Utilities Chair Ann Berwick, now leading the City of Newton’s municipal aggregation. "There is very steep growth in aggregation in Massachusetts and it is connected to customers' growing climate awareness."
The record-setting growth of state and local governments with 100% clean energy or zero emissions targets and the growth of CCAs are linked, according to 2019 reports from the National Renewable Energy Laboratory (NREL) and the University of California, Los Angeles, Luskin Center for Innovation (Luskin).
CCAs are also forcing utilities to set higher climate and renewables goals, added Sierra Club Ready for 100 Senior Campaign Representative Drew O’Bryan. "Each CCA with a 100% renewables commitment adds pressure for the utility to accelerate the timeline of its transition." CCAs' impacts on utility and local policy objectives are changing the power system, and trends toward larger aggregations and local empowerment through greater local choice of resources may accelerate their effect, advocates told Utility Dive. But limitations of local governance and cost issues could compromise that effect, Edison Electric Institute (EEI) Vice President of External Affairs Brad Viator cautioned.
The demand for clean energy to meet climate goals is unmistakable. In 2019, roughly 7.8 million residential and commercial-industrial retail electricity customers bought about 164 million MWh of renewable energy through green power markets, up from only 37 million MWh in 2010, according to NREL data. CCAs are playing a key role. Roughly 4.7 million CCA customers bought about 13.1 million MWh of renewable energy through CCAs in 2018, and preliminary NREL data showed participation in CCAs grew an estimated 40% more from 2018 to 2019, NREL reported. In addition, local governments procured a record 3,683 MW of new renewable capacity in 2020, the latest data from Rocky Mountain Institute and World Resources Institute show… click here for more