It’s one thing when people, companies, communities and utilities add in more solar and wind when they’re required to by law, but it’s another thing when they choose to voluntarily do so. And yet, from the U.S. Government to local communities it’s happening today. Three of the methods to implement such actions across a community or agency are community choice aggregation, crowdfunding and reverse auctions. They were the subject of a DOE Webinar Dec. 18, explaining how each is helping increase the amount of renewables in the U.S. at different levels.
The reverse auction mechanism is being used by the U.S.’s General Services Administration, the U.S. Armed Forces, Maryland and others to get the best bids on energy and driving up their renewable energy procurements. Under such programs organizations can elicit a bid from qualified developers or installers and allow them to bid against each other to determine who will offer the best price on energy, explained Chris McCall, a senior program manager at SAIC, who has worked on reverse auction programs with the federal government. Such programs have been credited with saving the GSA 40 percent on their energy bills across four New England states, while ensuring that 7.5 percent of their energy comes from renewables under the contract.
Another emerging tool being used to reduce the cost of procuring renewables is called community choice aggregation (CCA). Under such programs, a community or even a state can feasibly offer an alternative to electricity already available through the grid, including a higher mix of clean energy than the region’s customers would otherwise have access to. Under such a system the CCA takes over the supply side of energy while allowing the utility to continue to provide billing, transmission and maintenance services, said Shawn Marshall, founder and executive director of LEAN Energy U.S. She formerly led the effort to create a CCA in Marin County, Calif.
Renewables now comprise about 27 percent of the CCA’s energy supply in Marin County. It offers two levels of clean energy,” Marshal said. The 50 percent renewable option is cost competitive with other offers in the county. And the 100 percent renewables level is available at a 1 cent per kWh premium.
“A CCA is a hybrid approach, it exists between investor-owned utility and a publicly-owned utility,” Marshall explained. To be effective a CCA must be designed as an opt-out service with electric rates similar to those offered by the utility in a service area. However, the plan isn’t financed by taxpayers. “It is a market driven model. It’s not tax subsidized.”
The third model discussed was the crowdfunding model that Solar Mosaic has used to drive community contributions to make solar projects possible. “Today’s technology allows people to inexpensively invest in clean energy projects,” said Daniel Rosen, Solar Mosaic CEO. “We feel like what we’re really doing at the end of the day is making these asset classes that were available [only] to the bank and making them available to the public.”
The crowdsourcing or crowdfunding program is allowing people within the community to invest in solar in small increments, according to Rosen. “We’re crowdsourcing for-profit investments into clean energy infrastructure.” That’s by making their crowdsourcing act as an asset class. But, “the asset class has been only for the big players. The Internet has allowed for aggregation to be done like never before.…It’s a platform where people are able to do things that they hadn’t been able to do before.” Now that the company has completed a number of projects, it’s ready to start developing projects that have a positive return on investment. Previously it was operating more like a non-profit, offering project investors a break even return on their investments.