Community Choice Aggregation (CCA), aka Community Choice Energy (CCE), municipal aggregation, governmental aggregation, electricity aggregation, and community aggregation, is an alternative to the investor owned utility energy supply system in which local entities in the United States aggregate the buying power of individual customers within a defined jurisdiction in order to secure alternative energy supply contracts. The CCA chooses the power generation source on behalf of the consumers. By aggregating purchasing power, they are able to create large contracts with generators, something individual buyers may be unable to do. The main goals of CCAs have been to either lower costs for consumers or to allow consumers greater control of their energy mix, mainly by offering “greener” generation portfolios than local utilities. Currently CCAS are possible in the United States states of Massachusetts, Ohio, California, Illinois, New Jersey, New York, and Rhode Island, and served nearly 5% of Americans in over 1300 municipalities as of 2014.
How CCAs Function in Electricity Distribution
Figure 1: How CCAs interact with utilities and consumers
CCAs are local, not-for-profit, public agencies that take on the decision-making role about sources of energy for electricity generation. Once established, CCAs become the default service provider for the power mix delivered to customers. In a CCA service territory, the incumbent utility continues to own and maintain the transmission and distribution infrastructure, metering, and billing. In some states, CCAs may be considered de facto public utilities of a new form that aggregate regional energy demand and negotiate with competitive suppliers and developers, rather than the traditional utility business model based on monopolizing energy supply.
The New York State Public Service Commission (PSC) has identified CCA as consistent with the stated goals of the regulatory reform “Reforming the Energy Vision” (REV), and has stated that local energy planning helps municipalities benefit from distributed energy resources enabled by REV. CCA legislation had been filed in the New York State Assembly in February 2014, followed by Governor Andrew Cuomo‘s order directing the PSC to implement CCA directly under its own authority in December 2014.
In December 2014, non-profit organization Sustainable Westchester submitted a petition to the PSC on behalf of its member municipalities to implement a CCA demonstration program in Westchester County. The PSC granted the Order on February 26, 2015 authorizing Sustainable Westchester to put out an RFP and award contracts for both electric and natural gas supply for residents and small businesses within municipalities in the county that pass a resolution to join the CCA: “The Sustainable Westchester pilot is expected to provide valuable experience on CCA design and outcomes that, in addition to the many comments in that proceeding, will assist the Commission in making a determination on statewide implementation of CCA.”
The program launched in 2015, becoming the first operational CCA in New York State. Similar local CCA organizing efforts are underway in Ulster County, Sullivan County, Hudson Highlands, and other communities.