The PSC’s Order enabling CCA in New York, adopted in 2016, falls short in equipping communities with the tools to implement the 2.0 model. CLP has assessed the possibilities of working within the limits of the state’s regulatory framework and has concluded that changes are needed in the regulatory structure for CCA to deliver meaningful long-term benefits to our communities.
Barriers to a CCA 2.0 model include:
- No pathway to integrate local renewable energy into CCA electricity supply. Unlike CCAs in California, CCAs here cannot directly procure local clean renewable energy as part of their supply mix.
- No revenue stream to support energy efficiency programs, community energy education, and energy planning. In California and Massachusetts, CCAs have access to Systems Benefit Charge funds collected by the utility to support programs for their communities.
- New York utilities are able to hedge in energy markets as ESCOs do, and because they are the aggregator of aggregators (some 75% of electricity customers in NY still get their supply through the utility), utilities are able to secure a price for electricity supply in wholesale markets that is challenging to beat. This will make it difficult for CCA programs to generate sufficient revenue from supply to support the kind of robust “2.0” programming characteristic of CCAs in California, where the supply market has not been deregulated. In Illinois and Massachusetts, the track record of CCAs in beating the utility supply price on a sustained basis has been mixed. Some CCA programs were suspended after initially succeeding in obtaining a competitive price and then later failing to replicate that success when the existing contract period ended. Currently, CCAs in New York are pretty much limited to the 1.0 model: They can negotiate contracts with ESCOs for supply on behalf of their residents and small businesses. The supply is likely to be the typical mix of electricity sources, including fossil fuels and nuclear. Communities can seek contracts that support renewable energy through the purchase of Renewable Energy Credits (RECs), but this will come at a premium cost (though at less of a premium than if purchased by an individual customer) and does not directly support local renewable development.
How do we move CCA forward in New York?
CLP introduced a proposal to the PSC that would enable New York CCA programs to automatically enroll their customers in community renewable projects, which would reduce energy supply costs to customers by reducing a number of developers’ project costs, expand the benefits of renewable energy to low- and moderate-income customers, and incentivize the development local renewable projects.
At the urging of CLP last year, a state-level working group that reports to the PSC's Clean Energy Advisory Council (CEAC) was created for the purpose of assessing the barriers, limitations, and opportunities for Community Choice Aggregation (CCA) in New York and making recommendations to the PSC and NYSERDA for policy and program changes to better align support the shift to a locally-based clean energy system. The final report was presented to the CEAC and submitted to the Public Service Commission in January of 2018, and could potentially expand CCA program opportunities if its recommendations are implemented by the PSC and NYSERDA.