This book is about the transformational change entering to the electric utility sector, the technological change that is driving this transformation and the business models that are emerging. If communities in the United States and across the globe want to be more than spectators in this process of change and harness some of these forces for the local communities benefits, then they must engage in this process. To provide some insight into how communities can actively participate in the transformation of the grid, this chapter explores opportunities for local communities to be directly involved in the process.

In Sections 2 and 3, this chapter examines the successes and challenges of community solar as a means to meet community energy goals. Section 4 then examines community choice aggregation (CCA) as an alternative means to allow communities to go beyond what community solar can achieve to offer a roadmap for a more comprehensive model for local sustainability. In an effort to better inform local communities, the next three sections of the chapter look closely at three diverse examples of CCA in different stages of their development in Marin County, California; Lowell, Massachusetts; and Westchester County, New York. In exploring these three programs, the chapter examines how the programs are developed, their ability to encourage the adoption of renewable energy, and their adaptability toward improving the resilience of their community’s energy systems. Through this analysis, the final section explores whether CCA is a viable means for going beyond community solar and providing both low-carbon resources and higher energy resilience for communities as they seek cost-effective ways to both help mitigate and adapt to our climate challenge.

Community solar has functioned as an opportunity to provide solar access to those unable to host their own arrays. The Department of Energy defines community shared solar as “a solar-electric system that provides power and/or financial benefit to multiple community members” (USDOE). NREL estimates that shared solar could represent “32-49% of the distributed market in 2020,” an additional 5.5–11 GW of generating capacity worth $8.2–16.3 billion of investment (NREL). Other attributes of community solar are: (1) it is located offsite for, at least, a portion of the customers; and (2) it requires appropriate state rules authorizing group (or virtual) net metering. Under group net metering, customers sign up for a percentage of the output of an offsite solar facility and receive financial credits on their utility bills for their pro rata share of the output.¹ Like traditional net metering, the community solar facility’s production and the community solar customers usage are netted on a monthly basis. While community solar is projected to grow rapidly, it is currently less than 1% of the solar PV capacity in the United States, with 108 projects serving 70,000 customers with 110 MW of capacity (O’Shaughnessy, 2016).

Community solar lowers the solar energy’s financial barriers, both, in hard and soft costs. It can provide affordable renewable power and financial benefits to more consumers, including renters and low-income households that face participation barriers. Community solar has the potential to significantly increase renewable energy production in the United States, which would assist communities and individuals to meet their energy needs with clean, resilient, locally owned energy production. Each state has different laws, regulations, and incentives; and each utility has policies that promote or discourage community solar. These policies exist in a constant state of flux due to ongoing legislative and regulatory changes (Jones and James, 2017).

For example, while group net metering allows a community solar customer to net their electric bill on a monthly basis, on any given day an individual customer may be overproducing solar (based on its pro rata share of output) and exporting energy to the grid; or, alternatively, consuming significantly more energy than is produced by the solar array and thus consuming energy provided by the grid. As customer adoption of net metered solar grows, so do the utility concerns about cost shifting, given that community solar customers still rely on the grid for some of their purchases, but may avoid paying an appropriate share of the system’s fixed costs (Blansfield and Jones, 2014).

In addition, while community solar arrays may be distributed generation that is independent from the grid, when the local grid is impacted by a regional power outage or even a local disturbance to the distribution system, the community solar facility is designed to disconnect from the grid and shut down its energy output. As a result, community solar on its own does not contribute meaningfully to local community resilience. When the grid goes down so does the community solar facility, and the solar customer’s energy supply is no more resilient than other grid-supported customers. Similar to Koirala & Hakvoort, conclusions in regards to Europe, in the United States, a comprehensive and integrated approach where communities can take control and capture the integrated benefits of distributed technologies is still lacking.

Six states have passed laws allowing CCA, including California, Illinois, New Jersey, Ohio, and Rhode Island (USDOE, 2016). In addition, the New York Public Service Commission has allowed CCA, as a pilot under its Reforming the Energy Vision proceeding (Hales, 2016). The underlying policy reason for the CCA legislation seems to vary by state with no clear trends apparent for those states that have authorized CCA compared to those who have not.

Under CCA, communities can competitively procure their electricity from third-party energy service companies (ESCOs) based on lowest cost or other factors, such as the renewable content of the electricity. Cost savings can accrue through the aggregation of electric demand and the reduction of overheads, such as customer acquisition costs, which have historically reduced ESCOs’ willingness to serve residential and small commercial customers. CCA is typically implemented as an opt-out program, which means that all customers are included in the program on a default basis, but are allowed to return to the utility default service option if they opt to do so (The Solar Foundation, Community Choice Aggregation). Utilizing an opt-out arrangement has resulted in CCAs being much more successful in enticing customers to enroll in renewable energy choice programs, with the lowest participation for CCA programs being approximately 75%, and the highest voluntary utility green power programs only achieving enrollment rates in the low 20s (USDOE).

In the following sections, we will take a closer look at CCA, as it has been implemented in California, Massachusetts, and New York. These three programs have been chosen to compare models in three states that have been innovators in grid modernization and leaders in clean-energy policies. Our discussion begins with California, which has been an early leader promoting opportunities for CCA.

Marin County in California is located on the San Francisco Bay, and according to the 2010 census, the population was 252,409. Marin Clean Energy (MCE), formerly known as the Marin Energy Authority, was California’s first CCA program, which started in 2008 (MCE, 2015). In the beginning, MCE only had eight jurisdictions as part of its joint powers agreement, but by mid-2016, the number of participating jurisdictions grew to 24 (Stepanicich,  2013; MCE,  2015). More recently MCE has expanded to include both Marin and Napa Counties, plus the cities of Richmond, Benicia, El Cerrito, San Pablo, Walnut Creek, and Lafayette.

MCE serves over 170,000 customers. Customers are automatically enrolled unless they provide a written notice opting out. Customers who remain part of the CCA have three energy procurement options that are either provided through bundled or unbundled renewable energy certificates or limited local solar generation. Although customers are enrolled automatically, customers may withdraw from the program at any time.

On December 6, 2012, Lowell filed a petition with the Massachusetts Department of Public Utilities (DPU) for an approval of a municipal power plan pursuant to a Massachusetts Municipal Aggregation Statute (G.L. c. 164, §134). Following multiple revisions, the DPU accepted the plan, approving Lowell’s CCA Program (The Commonwealth of Massachusetts Department of Public Utilities, 2014). The detailed Lowell Aggregation plan explains everything from the plan’s basic purpose to exemplifying the rates for a customer with a monthly energy usage of 500 kWh (City of Lowell Community Choice Power Supply Program: Aggregation Plan, Section 6.3).

The plan’s purpose is to represent consumer interests in competitive markets for electricity and to aggregate consumers in the city to negotiate rates for power supply. It brings together the buying power of almost 40,000 consumers allowing the city to take control of their energy prices. Participation is voluntary and eligible consumers have the opportunity to opt out of the plan’s service and to choose their own competitive supplier. Based on enrolment figures from the previous community aggregations, it is anticipated that 97% of the eligible consumers will participate (City of Lowell Community Choice Power Supply Program: Aggregation Plan).

In February 2014, a group of local officials and clean-energy advocates in Westchester tried to push a bill in New York State Senate to authorize municipalities participating in a CCA program, to “coordinate efforts to procure electric and/or gas supply services on behalf of its residents.” The bill would have established New York’s pilot CCA program in Westchester County, which is served by New York State Electric & Gas Corporation (NYSEG) and Consolidated Edison of New York (ConEdison). Although Governor Andrew Cuomo supported the idea of CCA, he vetoed the bill because of the restrictions on the Public Service Commission’s (PSC) ability to intervene and the lack of protections for third-party access to consumer data. Following the veto, Governor Cuomo directed the PSC to implement CCA programs under its existing authority (Giamusso, 2015).

Although MCE has historically partly relied on unbundled RECs, it is taking steps through its net metering program and feed-in tariff program to increase local energy generation. Additionally, MCE is developing local community solar facilities. MCE customers’ high renewable energy purchase rate and the program’s commitment to move MCE to 100% renewable energy from renewables with bundled RECs are inspiring. Microgrid and grid resilience are not yet priorities for MCE, but preliminary steps to develop energy storage and increase resilience are underway. The next logical step would be for MCE to consider working with PG&E to develop microgrid pilot projects in the MCE area.

Sustainable Westchester, while still at an early stage of development, seems to be anticipating a more integrated approach that, both, explores strategies that help reduce the community’s carbon footprint and increase local energy resilience.

Glenn Weinberg, Joule Assets manager of special projects, calls the Westchester model the “triple threat—a real new community energy paradigm.” Community choice energy and demand response aggregations, microgrids, and community solar are being used separately and in various communities. However, bringing them together is a more holistic approach and is greater than the sum of the separate parts, offering green energy and increased reliability at a better economy of scale for the community. According to Weinberg, “The value of each is dynamically enhanced by the other” (Wood, 2015).

Local solar, without the more comprehensive control structure that comes with a microgrid, does not enhance reliability because, when the grid goes down, so does the local community solar. The presence of the microgrid allows the community to reduce its carbon footprint and increase its resilience. “Microgrids make ideal sites for shared renewables. A microgrid gives the host the flexibility to sell excess power during normal grid conditions, and distribute power to loads within the microgrid, when in islanding mode,” said Sustainable Westchester in a filing before the Public Service Commission (Wood, 2015). From these case studies, CCA can solely be focused on community control of the electric supplier, or it can launch a community down a low-carbon path that may lead to increasing resilience.