"Greening" the Mix through Community Choice
Community Choice Aggregation (CCA) is an emerging electricity supply model that allows residents and businesses to purchase electricity from local government agencies instead of utilities. According to a 2016 report by the Center for Climate Protection, CCAs are projected to account for 60 percent of Californian customers currently served by independently-owned utilities by 2020 (CCP, 2016). Through a critical assessment of CCA energy procurement strategies in California, this report outlines opportunities and potential pitfalls of the CCA model to meet the goal of local energy and transportation needs with cleaner, renewable energy resources by 2050. CCAs are initially constrained by limited access to capital as well as the difficulty in simultaneously meeting ambitious renewable energy, affordability, and economic development objectives. While access to capital improves as CCAs mature, ongoing policy uncertainty regarding cost allocation between utility and CCA customers may threaten the model’s long-term viability. Meeting the Grand Challenge goal will require expanding the current CCA focus on renewable electricity procurement to include a broader suite of policy instruments, such as energy storage and electrification of transportation and natural gas applications.
Urban Planning, Luskin School of Public Affairs
Advisor: Stephanie Pincetl
Institute of the Environment & Sustainability, Physical Sciences
Progress and Results
This study finds considerable variability in the implementation of renewable energy procurement strategies among California’s three most-established CCAs. CCAs’ ability to pursue procurement objectives is found to be constrained in early years of operation by lack of credit rating, as well as challenges in balancing renewable energy targets with other potentially competing objectives such as lowering electricity rates for consumers while promoting local economic development. While immediate issues around access to capital appear to be resolved as CCAs mature, ongoing policy uncertainty regarding cost allocation between utility and CCA customers raises some serious concerns about the model’s viability in the longer term. The specific impact CCAs will have on the future development of California’s renewable energy resource potential – including the type, size and location of generation – remains to be seen.