Massachusetts seeks to streamline approvals for community choice aggregation
Massachusetts officials are proposing policy solutions to address a bureaucratic backlog that municipal leaders and clean energy advocates say is bogging down one of the state’s most successful drivers of clean electricity purchases.
Nineteen communities across the state are waiting for public utility regulators to rule on proposed community choice aggregation plans, in which local governments negotiate with power suppliers for lower prices or a higher share of renewables.
Some of these municipalities have been waiting for more than two years to launch their programs. Another 16 are waiting to see if the state will let them modify existing programs. As the proposals languish, municipalities are missing out on chances to save residents money and cut carbon emissions.
In response to this backlog, the state energy department has proposed a new system to streamline the process, though many advocates are highly skeptical of these guidelines.
“I’m not sure that the way they’ve drafted them is really going to address the backlog,” said Martha Grover, sustainability manager for the city of Melrose, which first adopted community choice aggregation in 2015 and has held off updating the program in recent years because of the delays.
In addition, state Rep. Tommy Vitolo has introduced a bill that would require faster response times and allow municipalities to make some changes to programs without seeking state approval.
Massachusetts was the first state to introduce these programs, as a part of electricity restructuring legislation passed in 1997. The policy allows individual cities and towns or groups of municipalities to use the promise of a built-in customer base to negotiate with power suppliers for prices. Generally, residents are automatically enrolled but can opt out at any time.
The Cape Light Compact, a group of 21 towns on Cape Cod and Martha’s Vineyard, formed the state’s first aggregation program in 2000. The idea was slow to catch on, however, until electricity prices started rising in 2013 and 2014, prompting more municipalities to seek alternatives. Today, there are 168 municipal aggregation plans active in the state, saving consumers more than $200 million annually, according to a report from the nonprofit Green Energy Consumers Alliance.
Though not explicitly an emissions reduction program, aggregation also allows municipalities to include more renewable energy in their portfolios than legally required. And many of them do exactly that: 76 of Massachusetts’ aggregation programs included extra renewable content in 2022, according to the consumers alliance. Another 40 communities let individual residents opt-in to higher levels of renewable energy. In 2022, Massachusetts’ green energy aggregation programs increased demand for renewable energy in the state by more than 1 million megawatt-hours, the Green Energy Consumers Alliance calculated.
“There is no other program in the commonwealth that produces cleaner electrons without subsidy,” said alliance executive director Larry Chretien.
The delays were first caused by the COVID-19 pandemic, according to a statement from the state energy department. Additionally, the complexity of the rules and requirements for a successful application have also slowed things down, state officials and municipal leaders agree. Each time regulators rule on a plan, any new precedent set by that ruling must be complied with by all future applicants. This requirement makes it hard for municipalities to understand the rules and forces frequent revisions. It also makes it more painstaking for the state to ensure a proposal meets the ever-changing slate of requirements.
“There are now 168 approved plans and we are held accountable to rules and ways of operating that are buried in the footnotes,” Grover said.
The proposed solutions
The state has responded to the backlog by releasing draft guidelines that summarize and simplify the detailed requirements. It has also issued an application template and proposed an expedited approval process for municipalities that use the template.
“Addressing these delays is a top priority for the [Department of Public Utilities], and we look forward to announcing finalized guidelines that will help facilitate a timely review of applications,” said department chair Jamie Van Nostrand.
For many municipalities, however, the guidelines make no changes to the process, but only formalize the existing approach, which many say amounts to micromanagement. At least eight cities and towns have filed testimony so far arguing that the proposal erodes local control and would be unlikely to speed up approvals. The draft guidelines would make the process “more burdensome and less efficient,” testified Michael Ossing, city council president in Marlborough, which adopted community choice aggregation in 2006, saving residents an estimated $26 million over the past 17 years.
“Aggregation should be under municipal control,” said Anthony Rinaldi, an Amesbury city councilor. “We should control how we implement the program, how we inform our citizens. But they want to control every little thing.”
Vitolo’s bill offers an alternative approach. It would address the delays by requiring the state to issue a decision on aggregation applications within 90 days. If this deadline is not met, a program would automatically be approved. If regulators rejected a program, and applicants resubmitted an amended plan within 30 days, the state would then have 30 days to issue a decision.
The bill would also allow cities and towns to make certain changes — including periodic changes to prices and product offerings, means of providing notifications to customers, and sharing translated materials — to their programs without returning to utility regulators for approval. Vitolo points to Boston, which launched a community choice program in 2021, as an example: the city wants to distribute translations of its information materials, but can’t do so without getting in the slow-moving line for approval.
“It’s been frustrating,” Vitolo said. “We want to allow these aggregators to make simple straightforward changes without going to the [state].”
Vitolo’s bill had a committee hearing in late September. Now supporters must wait to see if it gains traction in the legislature.
Massachusetts seeks to streamline approvals for community choice aggregation is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.