Highlight
- In 2021, total estimated annual load in Community Choice Aggregations in California increased 1.38 percent over 2020’s annual load, serving over 11 million customers in the state.140 In April, the California Public Utilities Commission (CPUC) assessed a $2 million resource adequacy penalty for poor execution of certain 2020 Public Safety Power Shutoff (PSPS) events, acknowledging the forecasted decrease in the CCAs’ out-of-state RPS procurement due to falling contract pricing because increasing in-state procurement, which decreases the need for out-of-state procurement. A fiscal deficit is expected beginning in 2028 at the current trajectory141 as more generation associated with facilities will expire and no longer have a Power Purchase Agreement with the IOUs. Although this generation will not be under contract, there is a possibility that these facilities will re-contract with their current counterparty or another retail seller in the future.142
140 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.
141 Albright, M., Cox, C. and Singh, A. (November 2020). 2020 California Renewables Portfolio Standard Annual Report. California Public Utilities Commission 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
142 California Public Utilities Commission. 2022 California Renewables Portfolio Standard Annual Report. Retrieved from: https://www.cpuc.ca.gov/-/media/cpuc-website/industries-and-topics/documents/energy/rps/2022-rps-annual-report-to-the-legislature.pdf
Challenge
- Following the bankruptcy of Western Community Energy in May 2021, Sonala Energy Alliance merged with Clean Energy Alliance (CEA), and continued its service as an energy services provider. These actions underscore the challenges CCAs face in procuring energy supply that is at the whims of a volatile market. Most of the CCA long-term contracts that plan to serve load in Compliance Period 2021-2024 have not yet reached commercial operation and assessments of the 65 percent procurement requirement.143 The renewables aggregate percentage in 2021 dropped 1 percent from 2020, and is forecasted to drop again by 8 percent in 2024, primarily because of expiring contracts and several new CCAs coming online with minimal-to-no RPS procurement, which indicates a slowed CCAs progress towards RPS requirement, per the California Public Utilities Commission (CPUC).144
143 Albright, M., Cox, C. and Singh, A. (November 2021). 2021 California Renewables Portfolio Standard Annual Report. California Public Utilities Commission Retrieved from
https://www.cpuc.ca.gov/-/media/cpuc-website/industries-and-topics/documents/energy/rps/cpuc-2021-rps-annual-report-to-legislature.pdf
144 California Public Utilities Commission. 2022 California Renewables Portfolio Standard Annual Report. Retrieved from: https://www.cpuc.ca.gov/-/media/cpuc-website/industries-and-topics/documents/energy/rps/2022-rps-annual-report-to-the-legislature.pdf
Opportunity
- In 2021, three community choice aggregators issued $2 billion in bonds to pay upfront for about 450 MW of renewable energy, which is expected to reduce power costs by $7 million a year in the first 5 to 10 years.145 One of the oldest members of CCA, MCE (Marin Clean Energy,) has signed the most long-term energy contracts, committing to over 900 MW, and more than 400 MW of its renewable capacity went online in 2020. Another aggregation of customer resources is the MCE’s Virtual Power Plant (VPP) program, which is set to add decentralized power to the local grid during peak hours, shaving down electricity bills in low-income zero-net energy homes in Richmond once launched in 2025.146
145 Penrod, E. (December 7, 2021). California nonprofits issue $2 billion in bonds to buy 30 years of renewable energy upfront. Dive Brief; Utility Dive Ltd. Retrieved from: https://www.utilitydive.com/news/california-nonprofits-issue-2-billion-in-bonds-to-buy-30-years-of-renewabl/611057/
146 Irvine, S., Tenney, J. (June 22, 2022). MCE Unveils Plans for Virtual Power Plant to Benefit Disadvantaged Richmond Residents and Businesses. MCE energy. Retrieved from: https://www.utilitydive.com/press-release/20220617-mce-unveils-plans-for-virtual-power-plant-to-benefit-disadvantaged-richmond-1/
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