As recently covered by the Boston Globe, Green Energy Consumers is excited to present our new report on the great economic and environmental benefits brought to the Commonwealth through what we call Green Municipal Aggregation (GMA) programs. Our report includes data on over 200 communities and we show how there are opportunities to build upon a great record of success to achieve even more if the state government provides the support aggregation deserves.
Municipal aggregation is the process by which a municipality (a town or city) purchases electricity in bulk from a competitive supplier on behalf of the residents and businesses within the community. The fundamental characteristic that distinguishes GMA from traditional aggregations is that the default electricity supply in a GMA includes more Class I renewable content than required by the Massachusetts Renewable Portfolio Standard (RPS) and Clean Energy Standard (CES).
As of June 2022, Green Energy Consumers Alliance serves several GMAs by supplying them with renewable energy over and above the amount required to meet the state mandates: Arlington, Bedford, Brookline, Dedham, Fairhaven, Gloucester, Hamilton, Medford, Melrose, Millis, Milton, Rockland, Somerville, Stoneham, Waltham, Westford, and Winchester. Green Energy Consumers Alliance also supplies additional renewable energy for consumers in these communities who opt-up to 50%, 65%, or 100% renewable energy content.
Our report is based upon Green Energy Consumers’ direct experience with those communities as well as our analysis of similar programs throughout the Commonwealth. Here are the key facts contained in our report:
- 215 cities and towns in Massachusetts have an approved aggregation plan, have participated in aggregation in the past, or are currently researching aggregation or waiting to be approved by the Department of Public Utilities. Here’s a color-coded map showing which communities have aggregations and how much they are adding in terms of Class I renewable energy.
- Of that total, 50 communities have what we call, “dark green” programs with a default electricity supply product with 5 percent or more Class I renewable content than required by the RPS.
- Over 20 more have programs that we consider to be “light green” with some extra renewable energy content but less than 5 percent.
- Over 40 communities don’t have a default product with Class I renewable content but offer an opt-up option.
- Altogether, these 100+ locally-based programs are responsible for increasing state demand for renewable energy by one million megawatt-hours per year beyond state requirements. That’s the equivalent of about 300 large wind turbines. It is critically important that these programs are achieving success by harnessing the purchasing power of communities through managed competition without requiring public subsidies.
- But there’s more! We analyzed data on the 38 communities with default products that include between 5 and 11 percent Class I renewable energy beyond the RPS (which is 24% in 2022). What we found was ratepayers enrolled in those products saved an average of 1.3 cents per kilowatt-hour compared to the Basic Service energy supply offered by Eversource or National Grid. For an average consumer using 6000 kilowatt-hours per year, the annual savings would be $78 per household. That’s significant savings for programs offering significantly more green power than the investor-owned utilities.
- Do the math: A product with 10% additional Class I power above a 24% requirement actually increases demand by 42%!
- If every family throughout the Commonwealth enrolled in such an aggregation program, with 5-11% extra green power, the economic savings would amount to over $200 million per year and the additional renewable energy would amount to 1.6 million megawatt-hours. It is important to note, however, that savings for GMA compared to utility Basic Service are not guaranteed. However, our analysis of the empirical data shows that recent history has been in favor of aggregation. We have observed that GMA is not always less expensive than Basic Service, but in the case of three-year contracts, which include six 6-month cycles of Basic Service pricing, GMA is less expensive for most of the six cycles.
- Attorney General Maura Healey’s office has commissioned three reports proving that consumers who choose a competitive electricity supplier apart from an aggregation typically pay more for electricity than Basic Service
The climate crisis is real and it’s vital that Massachusetts exploits every possible solution to reducing emissions. State law requires that emissions be reduced 50% by 2030 compared to 1990. Governor Baker’s office is about to publish a Clean Energy and Climate Plan with dozens of recommendations on how to reach the 50% mandate. Will aggregation be on the list of things to foster?
Green Municipal Aggregation is solid evidence that we can speed up the transition to green power affordably. The climate deniers who insist that fossil fuels are always better for the consumer are wrong.
GMA is also a winner when it comes to social justice and equity. In communities with aggregations, consumers can opt-out at any time without penalty or, in many cases, stay with the aggregation and “opt-down” to a product that isn’t greener than state law requires and that costs the least.
Despite all these measures of success, the data also shows that the Mass. Department of Public Utilities has been incredibly slow to approve plans proposed by new communities and even minor amendments proposed by existing aggregations. As H. Jackson Brown wrote, nothing is more expensive than a missed opportunity.
Postscript from Rhode Island: Several communities in the Ocean State have aggregation plans approved by the Public Utilities Commission. We’re hopeful that they will be in operation by the end of 2022.