How Communities Can Get Cheaper, Cleaner Energy

Community Choice energy programs put the power back in communities

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Many states now have targets for clean energy, which force utilities to provide more of it. In California, a leader in this area, the utilities have a mandate to provide 50% clean power by 2030.

But even when utilities do provide clean energy, that energy often comes from big plants in the desert that may destroy fragile ecosystems — and that require building long, expensive power lines. And the utilities are still the ones who have all the power (pun intended).

Utility customers pay for this power and infrastructure — and who benefits? The utility.

It doesn’t have to be this way.

Enter Community Choice energy …

Millions of Americans are going solar. A growing number are signing up for clean power plans or community solar.

But many people can’t put solar on their roof. Community solar is still not widely available. And buying power from a clean power plan, though it’s a great first step, isn’t the same as having clean power coming to your home from a facility nearby.

There’s another way for people to get clean energy — and in many cases, to get it from sources closer to where they live. Community Choice energy can also bring many more benefits to communities.

Community Choice is a model that’s been around in some states since the 1990s, but is now picking up steam. (You may have also heard it referred to as CCA, or Community Choice Aggregation.) It lets a community choose where to get its power.

That means a community can choose cleaner, cheaper power — and enjoy its benefits.

These programs have been getting a lot of attention lately, with a mention of them even coming up at the Energy Gang session at the recent GTM Solar Summit. As Jigar Shah noted there, the programs enjoy a great deal of support, because people want to get their own clean, cheaper energy.

One reason that these programs can offer cheaper energy is that they’re starting at today’s prices. Utilities in California, for example, are stuck with prices for legacy PPAs. That opens the door for Community Choice energy programs to compete at newer, lower prices. And that makes Community Choice programs all the more attractive.

How Community Choice energy works

In a Community Choice program, customers are still connected to their utility, which continues to maintain the transmission and distribution lines. But the Community Choice energy program, a public entity, procures the power. Here’s a breakdown of how it works:

Who does what Investor-Owned Utility Community Choice Energy
Procures power Utility Community energy authority
Sets rates Utility Community energy authority
Owns and maintains transmission lines Utility Utility
Handles billing and customer service Utility Utility

 

(Some areas, of course, have municipal utilities. In those situations, the local government does all of the above.)

With Community Choice energy, a community energy authority designs the program and is accountable to the community. In these programs, cities or counties have a few ways they can provide clean energy and also cut down energy use. They can:

  • Contract with a licensed energy service provider to purchase energy in bulk.
  • Build facilities to generate clean energy, like solar installations.
  • Implement energy efficiency programs.

Community Choice energy in California

Community Choice energy programs are operating in a few states around the country. While some of them focus on cheap energy and customer choice without necessarily supporting clean energy, the programs in California tend to have a clean-energy focus.

California’s first Community Choice energy program was Marin Clean Energy, which started in 2010. Now, 8 programs are operating in the state, with an estimated 900,000 customers. And 16 more programs are being considered.

In fact, it’s estimated that over the next 5 years, 60% of utility customers in California will be part of a Community Choice energy program. That’s huge.

A model program

Early next year, a new Community Choice program will start in Alameda County, which includes cities like Oakland and Berkeley. East Bay Community Energy, with 11 cities participating, hopes to be a model for how these programs can build out local energy and really benefit the community.

As promoted by Community Choice advocates in the region, the program is very different from a utility. It’s not simply an energy provider — instead, it’s an energy services provider. What does that mean? For one, it provides a host of distributed energy resource services that include more than clean electricity and energy efficiency. It also integrates these with storage, conservation, demand response, and other technologies for optimizing energy use, like microgrids, vehicle charging, and more.

East Bay Community Energy will also be the first such program committed to local buildout, with a business plan to enable, promote, and provide a roadmap for the local buildout.

Local clean energy projects are often a goal for Community Choice, but many Community Choice energy programs start with a larger percentage of energy purchased on the market. That can be necessary to get a program going.

Still, that energy market is unstable and volatile, and buying power this way may mean getting it from a distant location. That means using those expensive transmission lines, plus missing out on a lot of community benefits like local jobs.

Benefits of Community Choice energy

Emphasizing local clean energy means more price stability, local economic development, local clean energy jobs, and local greenhouse gas reductions. It means competition in the energy market, which can lead to lower prices for all customers. And it means communities have a choice in where they get their energy.

The East Bay Community Energy program hopes to achieve these specific benefits:

  1. Inclusive community representation, giving community members a say in what happens.
  2. Competitively priced electricity, with lower, more stable rates than the utility currently offers.
  3. Carbon emissions reductions even greater than what’s mandated now in the state.
  4. Prioritizing local renewables.
  5. Local, family-sustaining union jobs that support local workforce development and racial justice.
  6. Community ownership and control of clean energy.
  7. Improved public health and safety.

Each Community Choice energy program is a bit different. Some may make it easier for homeowners to go solar by providing better rates for solar customers. So in some cases, a Community Choice energy program may even benefit existing or potential solar customers.

The programs should definitely benefit all power customers, including lower-income ratepayers — plus workers, unions, local businesses, renters, and property owners.

How anyone can participate

The way these programs usually work is that each consumer is automatically enrolled unless they opt out.

So if customers live in an area covered by Community Choice energy in California, they don’t need to do anything other than wait for the program to start up.

People can also get involved in a Community Choice energy program in their area — whether one is in place to provide input on, or if the area needs help starting a Community Choice program. Join the Local Clean Energy Alliance to get informed about these programs or even help advocate for them.

How the new program will affect your solar business

It remains to be seen how East Bay Community Energy will affect solar customers, as the details are still being worked out. But it’s certainly likely to benefit local solar installers.

For one thing, the program may make it easier for homeowners to go solar. For another, it will encourage more commercial solar projects that can be built to provide power to the community.

We’ll be following this one as it develops, so look out for future stories on this model program.