Highlight
- In 2020, total estimated annual load served by Community Choice Aggregators in California increased 9.2 percent over 2019’s annual load, with 19 CCAs serving over 11 million people in California that year.90 Furthermore, CPUC forecasted a decrease in the CCAs’ out-of-state RPS procurement due falling contract prices increasing in-state procurement, which decreases the need for out-of-state procurement. However, the CPUC forecasted a physical deficit beginning in 2028 at current trajectory,91 as more generation associated with facilities becomes expired and no longer has a Power Purchase Agreement with the IOUs.
90 Data based on 19 CCAs. There are a few additional CCAs that launched in 2020 or later in which there is no data yet on the annual load: Baldwin Park Resident Owned Utility District, Clean Energy Alliance, Pomona Choice Energy, and San Diego Community Power.
91 Albright, M., Cox, C. and Singh, A. 2020 California Renewables Portfolio Standard Annual Report. Calfiornia Public Utilities Commissoin. November 2020. Retrieved from https://www.cpuc.ca.gov/uploadedFiles/CPUC_Public_Website/Content/Utilities_and_Industries/Energy_-_Electricity_and_Natural_Gas/2020%20RPS%20Annual%20Report.pdf
Challenge
- The bankruptcy of Riverside County’s Western Community Energy in May 2021 underscores the challenges CCAs face in procuring energy. CCAs typically do not own physical assets that generate power; instead, CCAs rely on power purchase agreements for power supply and on investor-owned utilities for transmission. In addition, CCAs have working capital requirements in support of energy procurement and hedging activities can be significant.92 All of these factors can significantly hinder CCAs’ ability to provide clean energy at competitive rates. To mitigate some of these risks, eight CCAs have formed joint buying group called California Community Power, which enables member CCAs to work together to procure larger energy purchases than each would be able to separately.93
92 Spengler, J., Masterson, K., Pidherny, D., and Repucci, S. “Community Choice Aggregator Risks Highlighted by Bankruptcy.” Fitch Wire. June 2, 2021. Retrieved from: https://www.fitchratings.com/research/us-public-finance/community-choice-aggregator-risks-highlighted-by-bankruptcy-02-06-2021
93 Foehringer Merchant, E. California CCAs Form Joint Buying Group, Creating Big-Time Power Purchaser. Greentech Media. February 9, 2021. Retrieved from: https://www.greentechmedia.com/articles/read/california-ccas-form-joint-buying-group-creating-big-time-power-purchaser
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