The municipal solution to climate change
Aggregation can play a big role in reaching goals
AROUND THE WORLD, in the White House, and at our State House, leaders are finally beginning to respond to the climate challenge. Here in Massachusetts, we can take pride in bold new legislation to curb greenhouse gas emissions. And the nation’s first large-scale off-shore wind project, Vineyard Wind, has been given the go ahead by the federal government. Those are exciting developments, but there’s something happening at the local level that deserves our attention as well.
In Massachusetts, cities and towns are increasingly taking advantage of a process known as green municipal aggregation or community choice electricity, which allows municipalities to purchase electricity directly from suppliers (rather than relying on the utilities to do it for us). Through aggregation, communities can offer options that include more wind and solar than required by state law at affordable rates. Today about 50 cities and towns in Massachusetts have done so and dozens more are at various stages of the approval process. Communities that have been doing this for some time keep renewing and usually add more renewable energy as time goes on.
We were proud to pioneer this green municipal aggregation model back in 2016, and our rough calculations are that, by 2022, programs like ours across the state will increase demand for renewables on our electric grid by at least 700,000 megawatt hours per year. That’s enough wind and solar to keep the lights on at about 100,000 homes. This is done by community choice and by consumer choice.
Residents and businesses who do not want to pay a small premium for more renewable energy can opt-out or opt-down (so far, very few do that). Consumers can also opt-up to 100 percent green power. This model does not require a public subsidy – the benefits come from group purchasing and managed competition. And it brings renewable energy to everyone in the city or town – no one is left behind or required to bear a cost they cannot afford.
The record also shows that the aggregation rate is often lower than the utility rate even when the aggregation supply has more renewable energy. When the aggregation goes out to the market to buy electricity, it has more flexibility than the utilities and that is an advantage. Two reports prove, beyond a reasonable doubt, that residential consumers are best served by municipal aggregation on the basis of cost.
A recent report by Attorney General Maura Healey estimated that electricity suppliers, who are often found going door to door convincing consumers to use their higher cost electricity plans, charged consumers $486 million more than what consumers would have paid to their utility over a five-year period. That’s an enormous amount of over-charge considering that this market serves just a fifth of the residential customers in the Commonwealth. Disproportionate harm went to low-income communities and communities of color.
Meanwhile, in neighboring Rhode Island, National Grid submitted data that proved two things: The first corroborated what Attorney General Healey’s study found. In Rhode Island, the individual marketplace cost consumers significantly more than utility service. The second point was that over a four-year period, National Grid customers in Massachusetts paid less for supply when they were with an aggregation than those who received supply from National Grid and much less than those who received supply individually from an electricity supplier other than the utility or an aggregation.According to the climate scientists, time is of the essence. That is why we need to take advantage of every opportunity we can to harness the power of consumers to speed the transition to a low-carbon future. Green municipal aggregation is one of the best ways to do that. In our opinion, it’s one of the easiest, fastest, fairest, most affordable and effective ways that a community can reduce its overall carbon footprint. It might be a cliche but it’s a powerful way to “think globally and act locally.” Ask the local officials in your city or town if they’re on the green municipal aggregation bandwagon yet. If they’re not, there’s no better time than the present to get started.
Larry Chretien is the executive director of the Green Energy Consumers Alliance.