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CCA Momentum Is Building
Exciting energy aggregation news is emerging from California and Illinois as well as New Jersey, where a number of aggregation programs are becoming operational this year. In Illinois, nearly 140 municipalities, including the city of Chicago, have municipal aggregation on their November ballot. With millions of customers switching from ComEd and Ameren service, Illinois is an aggregation market to watch. Consumers are benefiting from significant rate savings, but some market fallout is likely. Lessons for other rapidly developing aggregation states will evolve.
Meanwhile, the great debate on renewable energy credits (RECs) continues as ever more CCAs use on them to green their supply. LEAN regularly fields questions about how RECs work, whether they actually result in new project development, and whether they can be double-counted. LEAN's position is that RECs are a legitimate market tool that can help a CCA meet its clean energy goals and remain cost competitive. Having said that, we reject the notion that a portfolio of 100 percent RECs is actually 100 percent clean energy. What matters is the underlying physical power delivered to the grid on behalf of a CCA. Thus, bundled renewable energy--the physical power plus the environmental attribute (REC)--is the cleanest option. But it isn't the cheapest. San Francisco's CCA, for example, authorized a contract for 100 percent clean energy that will cost customers 8 to 18 percent more. Why? Because San Francisco is serious about climate power, and its elected officials opted for a portfolio of 95 percent bundled renewables (wind, hydro, solar) and only 5 percent RECs. This option may not be feasible for other cities. The beauty of CCA is that it's a flexible model, reflecting each community's goals, whether rate savings, local revenues, greenhouse gas reductions, or some combination thereof.
In the final analysis, LEAN recommends a diversified portfolio that is cost-competitive, responsive to demand reduction, and as carbon free as possible. Not every community must emulate San Francisco, but we shouldn't be lulled into believing that RECs are a complete clean energy solution.
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RECs WEBINAR For information on RECs and how they work, check out the October 4 free REMA (Renewable Energy Markets Association) webinar on REC claims from marketer, utility, and aggregator perspectives.
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ILLINOIS: Another 140 Go to Ballot, Civic Contributions through CCA, and a New Price Low
Residential consumers are choosing electricity choice As reported in July, Chicago, along with nearly 140 other Illinois communities, voted to place electric aggregation on this November's ballot (http://www.pluginillinois.org/MunicipalAggregationList.aspx). If Chicagoans pass the referendum, the city will become the largest aggregated load in the country with more than 900,000 accounts representing 6 million mwh/year in the residential and small commercial sectors. Although the current rate savings of nearly 30 percent is expected to shrink by June 2014, more than 1.5 million of ComEd's residential customers will switch to aggregation programs by the end of 2012. If a majority of the November referendums pass, an additional 1.2 million ComEd customers could switch by 2013. Because of industry restructuring, ComEd's primary role has shifted to electricity distribution, and more than 40 alternative suppliers are now certified to sell energy to residential consumers in ComEd's territory. Nearly100 communities in Ameren's territory are on the November ballot as well. http://www.4-traders.com/EXELON-CORPORATION-13963/news/Exelon-Corporation-Residential-Consumers-Are-Taking-Advantage-of-Electricity-Choice-15220591/ Civic contributions fill budget gaps and fund sustainability programs When West Dundee voters approved electric aggregation in March, city staffers accepted a bid from First Energy that included a pledge to set aside one-tenth of a penny per kwh for the community. The town will use the money to help close a gap created when a local Best Buy closed, taking $200,000 a year in sales tax with it. Six other communities in the northwest suburbs of Chicago are also collecting a "civic contribution" as part of their electric aggregation programs. Most of the communities are using the revenue to boost their general funds, but Hoffman Estates plans to use its civic contribution for local sustainability projects. The town is collecting one-hundredth of a penny per kwh, which by year's end could generate $120,000, to improve energy efficiency in municipal buildings. In Island Lake, the town council will use its estimated $20,000 civic contribution for sidewalks and other projects benefiting the community. READ ON Low, lower, lowest: Logan County takes the prize In September, residents of Atlanta, Lincoln, Emden, and unincorporated Logan County began enjoying the lowest electricity rates in Illinois. Logan County accepted an aggregation bid from Integrys Energy Service of $.03965/kwh for the next two years. In the first year, the communities will save an estimated $2.3-$216 million annually per household compared with the estimated average Ameren default rate of $.05752/kwh. Michael Maniscalco, director of the Lincoln and Logan Development Partnership, and partnership board president Steve Smith are excited about keeping those dollars in the county. The new price reflects the cost of 25 percent renewable energy, allowing the county to meet the state renewable portfolio standard of 25 percent by 2025. http://www.sj-r.com/top-stories/x465801491/Logan-County-customers-to-pay-lowest-electric-supply-rate-in-state 
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CALIFORNIA: San Francisco Goes Green; Anti-CCA Bill Defeated; RFI Increases Sonoma's Options
CleanPowerSF gets the green light
On September 18, after years of debate and false starts, a super majority of the San Francisco's Board of Supervisors approved Phase I of its CCA program, aptly called CleanPowerSF. The program is controversial due to an 8 to 18 percent cost premium associated with its green power supply, but San Francisco will become the first CCA in the nation to offer its customers power that is 100 percent certified renewable--a feat accomplished with the use of only 5 percent renewable energy credits. The Board authorized a total expenditure of $19.5 million, of which $6 million is set aside for residential solar incentives, energy-efficiency programs, and a study for the construction of local distributed generation projects. The remaining $13.5 million will enable a five-year energy contract with Shell Energy North America. READ ON
California's governor vetoes CCA poison pill
In spite of fierce opposition by utility unions, governor Jerry Brown vetoed AB 976, a bill that would have made the successful launch of a CCA program in California virtually impossible by prohibiting any contact with potential providers of electricity or energy services before provision of service to customers. AB 976 acted as a poison pill to CCA by requiring solicitation (through a public RFP process), negotiation, and execution of a wholesale power supply agreement in a 30-day period, which is simply not feasible. In a message to CCA allied organizations, LEAN executive director Shawn Marshall said that the governor had taken a stand for CCA. "With last year's passage of SB 790 and now the veto of AB 976, it is clear that CCA can prevail in California," noted Marshall, "but we must remain coordinated in our efforts and vigilant at the state legislature and California Public Utilities Commission."
http://www.kcet.org/news/rewire/government/energy-groups-urge-brown-to-veto-aggregation-limits-bill.html
RFI expands options for Sonoma Clean Power
After a unanimous vote by the County Board of Supervisors to move ahead with its pursuit of CCA, the Sonoma County Water Agency (SCWA) issued a request for information (RFI) to gain market intelligence and indicative pricing from a diverse set of energy suppliers and vendors. The RFI is a planning and discovery tool used to test the market and identify creative financing solutions and least-cost CCA services. In Sonoma's case, the RFI will inform key elements of Sonoma Clean Power's implementation plan and supply RFP, which may be issued as early as next spring. Cordel Stillman, deputy chief engineer at SCWA and lead staffer for Sonoma Clean Power, reports that 18 companies responded to the RFI. "We learned a lot," said Stillman, "and we came away with several new ideas and options to enhance Sonoma's CCA plan." Sonoma Clean Power is on track to launch its 350-megawatt program next fall. Sonoma Clean Power's RFI was developed in partnership with LEAN Energy US. READ ON
CCA takes center stage at Bioneers Conference
Ecologistics Inc. will host a presentation on CCA as part of the Central Coast Bioneers Conference in San Luis Obispo on October 20. The panel will include LEAN executive director Shawn Marshall; Paul Fenn, the author of California's CCA law; Lane Sharman, co-founder of the San Diego Energy District Foundation; and Andrew Christie, chapter director of the Santa Lucia Chapter of the Sierra Club. Registration and more information about the conference can be found at
www.ecologistics.org/centralcoastbioneers/.
San Luis Obispo forms CCA leadership group
A group of energy professionals, local business leaders, and energy activists has formed the SLO County Clean Energy/Economic Development Coalition. The coalition is committed to expanding local clean energy and economic opportunity in San Luis Obispo County and views CCA as a powerful tool to pursue these goals. For more information, contact Eric@slocleanenergy.org.
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NEW JERSEY: Energy Aggregation Picking Up Steam
State's first energy aggregation issues supplier RFP
Plumstead Township has issued an RFP to all New Jersey-registered energy suppliers, reports Cooling America thru Local Leadership (CALL), which with Gable Associates has worked with the municipality to establish the state's first community energy aggregation (CEA) program. The RFP for a one-year contract does not call for more than the state's required renewable portfolio standard of 4.1 percent. According to CALL president Stefano Crema, Plumstead and about a dozen other New Jersey municipalities investigating CEA are intent on first realizing rate savings, which Crema estimates at 5 to 10 percent, before contemplating other clean energy options, including PACE (property assessed clean energy) financing. READ ON
RECs legislation in New Jersey may spur formation of CCAs focused on solar energy development
In August, governor Chris Christie signed Senate bill 1925, which was originally crafted to address what was an oversupply of solar renewable energy credits (RECs), the key component for financing and subsidizing the price of solar energy. The bill addressed the oversupply by increasing the percentage of electricity delivered in New Jersey that must be generated by solar electric or offset by the purchase of solar RECs. The bill extended the market for solar RECs from 2026 to 2028 and also decreased the compliance payment that New Jersey energy suppliers must pay for every megawatt not delivered with renewable energy or offset with solar RECs. According to Tom Brys, vice president of Renewable Energy for Birdsall Engineering, the payment, which formerly started at $711 and is now capped at approximately $593, led to the use of projects as moneymaking machines rather than for relieving strain on the grid. Brys likened the previously uncapped payment to a license to print money for outside investors. Now those who implement large-scale solar projects must consult the Board of Public Utilities, he said. Brys believes the legislation will redirect New Jersey's REC program to its original purpose: alleviating grid congestion and helping electric ratepayers. READ ON
Jackson Township announces energy aggregation program
In a bid to reduce residential and municipal energy rates, Jackson Township has scheduled a public presentation with an energy aggregation consulting firm. Recent changes in state legislation and aggregation policies adopted by the State Board of Public Utilities laid the ground for the township to move ahead with its program and choose a competitive third-party electric supplier. Mayor Michael Reina says the township's plan to aggregate its load will save ratepayers between 5 and 10 percent on their electric bill and the township as much as $92,000 each year.
http://www.tomsrivernjonline.com/2012/09/11/jackson-township-announces-public-energy-aggregation-program/7483/
Foundation for state's CCA marketplace laid
In pitching CCA to officials of Brick, New Jersey, Colonial Power Group's Brian Murphy touted guaranteed savings. Murphy explained that the incumbent utility draws its energy from investors in the power market, usually large companies such as Citigroup, Conoco, and JP Morgan. "The township can't engage a rate that is higher than what customers are paying now," said Murphy. Aggregation agreements stem from a 1999 decision to deregulate New Jersey's electricity market. But Murphy said the new market never really developed because rules for handling it weren't written until 2008 and then were revised in 2012. He reported that an energy aggregation plan would save Brick residents $180 per year on their electric bills.
http://brick.patch.com/articles/company-pitches-energy-aggregation-to-brick-council
MASSACHUSETTS: Aggregation Brings Green Option to WMECO Customers As we reported in July, the Hampshire Council of Governments (HCOG) has developed a municipal aggregation plan that will save 28 communities millions in electricity costs. The council's electricity director, John O'Rourke, says customers of National Grid and the Western Massachusetts Electric Company (WMECO) will pay for both delivery and supply services through their aggregation. HCOG will supply more than 100,000 residents, powering the grid in several towns, including Granby, Hadley, and Hatfield, by the end of 2012. Lower electricity rates aren't the only benefit of their municipal aggregation: customers also have the option to participate in a green energy program, which consists of purchases of renewable energy credits, when their municipalities join the council's default supply program. Former WMECO customers will have the green option for the first time. http://www.wwlp.com/dpp/news/local/hampshire/hampshire-county-towns-join-in-plan-to-save-on-energy OHIO: Still in the Lead, But Not for Long Although Illinois could soon surpass it, Ohio leads in the number of aggregated customers in the United States. Twenty-three counties, dozens of towns and large cities, and a handful of villages have electricity aggregation programs operating in Ohio (http://maps.puc.state.oh.us/aggregators/electric.asp ). Like Illinois state law, Ohio law allows for both opt-in and opt-out aggregation. If a community chooses the latter, a majority of voters must authorize it in a primary or general election, and the local government must develop a plan of operation and management and hold at least two public hearings to allow customers to voice any concerns over the proposed plan. Once the municipality has adopted the plan, customers are enrolled through the standard opt-out notification process; aggregation customers may opt out every three years without paying a switching fee. CCA EXPANSION: Enabling Legislation for Wisconsin? In formal comments to the Wisconsin Public Service Commission on a statutorily mandated strategic energy assessment, the COMPETE Coalition has urged the state's legislature and the governor to allow homeowners and businesses to choose among competing electricity service suppliers and to enable community choice aggregation. The commission noted that ratepayers have expressed anger about "utilities raising rates during a time when they are using less in order to reduce their energy costs." The commission also noted that Wisconsin's retail rates are the highest in the Midwest and above the average nationally. http://greenbuildtv.com/resources/a-new-look-at-the-cost-of-your-electricity/
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Share Your CCA News CCA News & Notes has a national readership. If you would like LEAN Energy to consider publishing your CCA updates and accomplishments, please email us at information@LEANenergyus.org. Don't forget to include links to your news-related documents, press releases, and news articles. New CCA States Network Interested in participating in LEAN's New CCA States Network? Contact us at 415-888-8007. We'll be hosting a launch call later this month. |
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