Community Choice Aggregation
What Is Community Choice Aggregation?
Community Choice Aggregation, or CCA, is a program that can reduce the cost of electricity and also facilitate our transition to sustainable energy supplies.
The theory behind CCA is simple. Municipalities, on behalf of the household and business customers in their jurisdiction, negotiate low-cost Power Purchase Agreements for electricity. No taxpayer money is involved. The consumer still pays for the electricity he or she uses while administrative expenses are paid by the Energy Service Company (ESCO) that is awarded the contract.
CCA was first introduced in Massachusetts in the mid-nineties, and today some 750 CCAs now serve over five million customers in seven states. The first (and so far only) CCA in New York State, Westchester Power, is a consortium of twenty-seven cities, towns and villages in that county. Since it went online in May 2016, the one hundred and ten thousand participating ratepayers have saved over seventeen million dollars—a figure that’s all the more impressive because twenty-four of the participating municipalities offer 100% renewable energy as the default energy supply.
The success of CCA depends upon a so-called opt-out provision, which ensures that a CCA captures a significant share of the market from the outset. On the day that a CCA launches, it replaces the local utility as the default energy supplier— all the customers who previously purchased electricity from the utility become CCA customers unless they opt out of the program. (In practice most consumers take no action, so they remain in the CCA.) Consumers who do not purchase electricity from the utility but instead have a contract with a competing ESCO are unaffected. They are not automatically included in the CCA, although they may choose to join it. For its part, the utility continues to own the wires poles and poles and continues to charge customers for the delivery service it provides.
Forming a CCA In New York State
CCA is a component of the New York’s Reforming the Energy Vision (REV), which emphasizes local control of energy decisions. Under rules promulgated by the Public Service Commission (PSC), a municipality that wishes to participate in a CCA must first pass a local law authorizing the program. Then with the law in place, a municipality (or group of municipalities) can choose to design and execute its own implementation plan or assign the program to a professional administrator. Thus far, the forty or so municipalities outside Westchester County that are moving forward with CCA have all chosen to work with one of three professional administrator who have filed approved implementation plans with the state.
The New York State Energy Research and Development Agency (NYSERDA) publishes an online CCA toolkit that includes a model local law and step-by-step instructions to guide municipalities through the process of creating a CCA. It also offers municipalities up to fifty hours of free technical assistance.
SASD has long been a proponent of CCA for Sullivan County. Over the past several years it has made dozens of presentations on the subject before the county legislature, town and village boards, and various civic organizations. Often these presentations have been made in concert with Joule Assets, the firm that helped develop the state’s first CCA in Westchester County.
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