CCA 101
What is a CCA?
Community Choice Aggregation (CCA) allows municipalities to purchase electricity in bulk from suppliers on behalf of their residents, and to obtain some or all of their electricity from clean energy sources, such as solar, hydro, and wind. Currently, several municipalities in National Grid territory are forming a regional CCA to maximize purchasing power. This exploration is being facilitated by the volunteer organization Capital District Community Energy.
How much will it cost?
The CCA administrator will request non- binding bids to supply electricity. Bids can be requested for different “mixes” of energy sources. We are hopeful that 100% clean electricity can be purchased for less than National Grid’s average price. If this isn’t the case, the administrator will also request bids for less expensive electricity from a mix of clean and traditional energy sources. After receiving the bids, each municipality can independently choose a default electricity option for its residents and small businesses, or choose not to participate. Residents will be able to switch from the default option to another CCA option if offered, or another supplier entirely.
How does CCA work?
When the New York Public Service Commission (PSC) deregulated electricity in the late 1990s, it separated delivery from the supply of electricity. CCA will change only the default electricity supplier. Municipalities will work with an administrative organization to assist in identifying and contracting with the new supplier. Municipalities can choose a supply of 100% clean electricity if desired. National Grid will continue to deliver the electricity and provide a single bill.
What will change for me?
There will be no change in electric delivery. In CCA, National Grid will continue to deliver the electricity to homes and businesses, maintain the electric lines, and provide one bill for utilities. New York State, via the Public Service Commission, has chosen National Grid as the default electricity supplier (the supplier unless action is taken to change it). Through CCA, participating municipalities will select a new default electricity supplier for all eligible residents and small businesses. Residents will be able to select a different supplier, including National Grid, at any time.
What are the benefits of CCA?
When a municipality purchases 100% clean energy, it has the same environmental impact as if all its home and small businesses have solar panels on their roofs. Electricity accounts for 19% of New York’s carbon emissions, so CCA is a path to significantly reducing our greenhouse gas emissions. CCA will likely feature a fixed-rate, multi-year contract with the selected electricity supplier, making prices stable for residents. By harnessing the purchasing power of tens of thousands of customers, clean energy can be purchased at a competitive price. The supplier will seek available local energy sources, which can create clean energy jobs.
What are the drawbacks of a CCA program?
CCA will feature fixed prices for the length of the contract, typically 2 or 3 years. National Grid’s prices could drop below the CCA’s price during the contract period, even if the CCA price starts lower. But if this occurs, residents can change to another supply option at any time. (Alternatively, National Grid’s rates could rise during this period, so locking in rates through CCA would be beneficial).
What is the process for a municipality to create a CCA program?
Here in the Capital District, the towns of Bethlehem, New Scotland, Guilderland, Saratoga Springs, and other municipalities have expressed interest in forming a region-wide CCA. The bigger the CCA, the more economic clout it has, and the greater ability to negotiate lower electricity rates. CCAs representing more than 40,000 households have the greatest purchasing power. Each interested municipality would need to do the following:
Join the regional CCA program being facilitated by Capital District Community Energy.
Enter into an Administration Agreement with the chosen administrator.
Educate residents and hold a public hearing. All residents have the opportunity to express their opinion.
Pass a local law to enable CCA.
Work with the regional CCA and administrator to seek bids for electricity, including a 100% clean energy option.
Select the electricity mix that’s right for its residents. Please ask your municipal leaders to join the regional CCA and select a 100% clean electricity supply for maximum environmental benefit.