As U.S. cities and counties transition to wash power for their very own operations and communities, many are discovering that stakeholders and insurance policies past their jurisdictions have an effect on their capability to buy clear power. Coverage and regulatory choices made by states, utilities, public utilities commissions and wholesale market governing our bodies decide the clear power procurement choices obtainable to cities and counties. This may create challenges for assembly domestically outlined resolutions and commitments.
To beat these challenges and drive quicker progress on renewables and carbon-free targets, native governments are beginning to interact with outdated stakeholders in new methods to alter the principles of the sport. By eradicating regulatory and legislative obstacles, native governments are creating new pathways to entry reasonably priced, clear power.
To assist cities and counties higher perceive potential high-impact engagement alternatives, the American Cities Local weather Problem Renewables Accelerator launched a brand new interactive device, the Native Authorities Renewables Motion Tracker. The device highlights efforts by native governments to work straight with the establishments and decision-makers who affect their capability to entry clear power and management the broader electrical energy system.
Listed below are 4 methods native governments are partaking with stakeholders to decarbonize their electrical energy provide:
1. Partnering with investor-owned utilities
Cities and counties usually are required by state regulation to purchase electrical energy from a regulated investor-owned utility (IOU) and lack the flexibility to decide on their electrical energy provider or era supply. Whereas some IOUs supply renewable power applications, these choices don’t all the time meet metropolis wants. Worse nonetheless, some cities don’t have any choices for buying renewable electrical energy.
To beat these circumstances, some native governments are partnering with their utilities. For instance, the town of Denver and Xcel Vitality developed a partnership settlement in 2018 to outline and collaborate on shared local weather and power targets.
By eradicating regulatory and legislative obstacles, native governments are creating new pathways to entry reasonably priced, clear power.
Most of these partnership agreements can result in the creation of recent renewables applications or customized utility options that allow native governments to buy renewables on a big scale. In North Carolina, Duke Vitality and the town of Charlotte signed an settlement that laid out the methods they might companion on clear power work. One yr later, Charlotte turned the primary metropolis to signal a large-scale deal by way of Duke Vitality’s new Inexperienced Supply Benefit inexperienced tariff program.
2. Partaking in state-level regulatory proceedings
Many key choices across the implementation of state power insurance policies, together with choices that govern IOUs, are made by state public utility commissions (PUCs). PUCs permit stakeholders to voice their wants as electrical energy clients, which could be a good alternative for native governments to advocate for extra renewables. Nonetheless, partaking in fee proceedings could be a time-consuming and cumbersome course of for native governments with restricted assets to navigate.
More and more, cities and counties are asking for extra renewables on the grid by commenting and offering testimony to their state PUC. This consists of commenting on their utility’s built-in useful resource plans (IRPs), long-range plans that talk how an electrical utility intends to develop new era property over the subsequent 10 to 20 years. In lots of states, utility IRPs are required by regulation and offering enter on them may be an impactful means for native governments to affect their regional grid combine and improve renewable power era.
Through the Indianapolis Energy & Gentle Firm (IPL) IRP course of, the town of Indianapolis submitted a public letter to encourage IPL to discover a extra aggressive retirement situation for the Petersburg Coal Producing Station and improve renewable era. Indianapolis cited an October report by Rocky Mountain Institute that discovered that clear power portfolios declined in price by 80 p.c since 2010, are lower-cost than new gasoline vegetation and are projected to undercut the working prices of current gasoline vegetation inside 10 to 20 years.
In feedback to the Georgia Public Service Fee (PSC), the town of Atlanta requested Georgia Energy to broaden residential power effectivity and renewable power applications, present larger entry to utility knowledge to enhance power effectivity efforts, improve municipal entry to renewable power and construct a brand new native microgrid to enhance neighborhood resilience. In response to buyer feedback similar to these, the PSC required Georgia Energy to greater than double photo voltaic power procurement over the subsequent 5 years from one gigawatt (GW) to 2.2 GW.
Native governments are additionally more and more advocating for various types of utility regulation and enterprise fashions. This consists of performance-based regulation (PBR), a kind of utility reform that incentivizes electrical utilities to display efficiency on metrics similar to greenhouse gasoline discount, effectivity and customer support.
This strategy contrasts with conventional “cost-of-service” enterprise fashions that incent utilities to construct extra bodily property, which typically lead to new buildouts of gasoline energy vegetation and pipelines, locking in emissions for years to come back. The town and County of Honolulu and the County of Hawaii have been actively engaged in advancing PBR by way of workshops, working group conferences, submitting written feedback to Hawaii’s PUC and creating considerate proposals recommending new PBR mechanisms for his or her utility to undertake.
three. Influencing statewide power coverage
When stakeholders come collectively to voice their must legislators, it has the potential to create large-scale change. Native governments are beginning to become involved on the state degree by calling for modifications to state local weather and clear power laws. There are a couple of high-impact coverage pathways that cities can pursue:
Eradicating limitations to photo voltaic
Native governments are asking state policymakers to take away limitations that stop renewable power procurement. Stakeholder enter just lately helped move the Virginia Clear Economic system Act of 2020, which created the state’s first clear power normal and lifted constraints on current state legal guidelines that restricted entry to 3rd celebration financing choices that may convey down the price of renewables. Equally, the town of Fayetteville, Arkansas, alongside different giant clients and native governments, efficiently referred to as for elevated entry to third-party financing for renewables, which finally would make clear power procurement extra reasonably priced for customers. In Utah, native governments got here collectively to ask the state to allow high-impact pathways for procuring renewables, resulting in the ratification of the Group Renewable Vitality Act of 2019. These native governments are collaborating with the state’s electrical utility, Rocky Mountain Energy, to develop a utility program by way of which they will buy 100 p.c renewable power.
When stakeholders come collectively to voice their must legislators, it has the potential to create large-scale change.
Phasing out fossil fuels
Cities and counties are advocating to retire uneconomic fossil gasoline energy vegetation by enabling or increasing securitization laws. Securitization can be utilized to permit utilities to situation bonds primarily based on the assured returns they’re making from the uneconomic vegetation and use the proceeds to construct or purchase cheaper renewable power. The shift to lower-cost era permits utilities to each earn more money and decrease charges for his or her clients whereas phasing out fossil gasoline energy vegetation. Forming a coalition with different native governments might help amplify a metropolis’s message to its state legislators. For instance, Colorado Communities for Local weather Motion (CC4CA), a coalition that consists of 33 Colorado counties and municipalities, commonly advocates for state local weather coverage. Members of the coalition meet with legislators, present testimony at state legislative periods, write op-eds and coordinate technique for native governments. CC4CA’s collective voice was a robust lever that helped move one of many strongest state local weather payments to this point, which incorporates each short-term and long-term clear power targets for Colorado.
Enabling or increasing neighborhood alternative aggregation
Group alternative aggregation (CCA) permits native governments to have full management over their electrical energy provide, offering the flexibility to acquire renewable power for his or her municipal operations, residents and in some circumstances, small companies. To make progress towards community-wide renewable power targets, cities are beginning to push for laws to allow CCA or to broaden renewable procurement by way of an current CCA. CCA could be a key mechanism for reaching community-wide clear power targets if a metropolis’s electrical utility doesn’t supply the procurement pathways wanted to realize its renewable power goal. Cincinnati has signed the most important municipal renewable power deal in U.S. historical past, partly due to the management the town had by way of its CCA program.
Forming a coalition with different native governments might help amplify a metropolis’s message to its state legislators. For instance, Colorado Communities for Local weather Motion (CC4CA), a coalition that consists of 33 Colorado counties and municipalities, commonly advocates for state local weather coverage. Members of the coalition meet with legislators, present testimony at state legislative periods, write op-eds and coordinate technique for native governments. CC4CA’s collective voice was a robust lever that helped move one of many strongest state local weather payments to this point, which incorporates each short-term and long-term clear power targets for Colorado.
four. Getting concerned in wholesale power markets
Guidelines made in wholesale markets can affect native authorities clear power targets and current obstacles for clear power procurement. Participation in market-level choices and stakeholder processes historically has been dominated by utilities and mills, however that’s beginning to change.
One current determination by the Federal Vitality Regulatory Fee might hamper the event of renewables in states that take part within the PJM wholesale electrical energy market. The choice directs PJM to implement a minimal supply value rule for renewable era assets supported by state insurance policies similar to renewable portfolio requirements and nil emissions credit. This rule successfully would increase the minimal value of renewables and, finally, ratepayer prices throughout the board. Some states, together with New Jersey and Virginia, are contemplating leaving the PJM capability market to protect their capability to supply incentives to develop renewable power.
The PJM Cities and Communities Coalition is the primary ongoing collaborative effort for cities to deal with limitations within the PJM wholesale power market. As a part of the coalition, cities similar to Washington, D.C., Philadelphia and Chicago are becoming a member of collectively to supply training to members on market points, contemplating changing into formal voting members and figuring out precedence points the place cities can interact. One of many coalition’s early efforts was a public letter o the PJM Board of Managers throughout its seek for a brand new CEO, urging the search committee to rent a candidate who might transfer the PJM market towards a clear power future.
Cities and counties have struggled to know their power coverage context and alternatives; how and when to interact with utilities, regulators and legislative employees; and whether or not to contain different stakeholders.
Figuring out and replicating native clear power successes
Partaking with utilities, commissions, state policymakers and wholesale market governing our bodies is new and unfamiliar territory for a lot of native governments. Cities and counties have struggled to know their power coverage context and alternatives; how and when to interact with utilities, regulators and legislative employees; and whether or not to contain different stakeholders. As soon as they determine to interact, native governments usually battle to dedicate the assets and funding essential to take part in ongoing efforts.
Whatever the strategy, collaborative efforts are key to overcoming these challenges and enabling more practical participation. This enables native governments to leverage restricted native assets, scale back political dangers and develop a powerful collective voice. This collective voice, specifically, usually may be extra highly effective than one native authorities performing alone.
The Native Authorities Renewables Motion Tracker is a crucial new useful resource cities and counties can use to see how different native governments are partaking with stakeholders and consider the choices obtainable for advancing their very own clear power initiatives and targets.
As cities and counties proceed to develop their voices as giant power customers, we must always count on to see them get extra concerned in state regulatory proceedings and legislative hearings, modern city-utility partnerships and market decision-making processes. Native authorities engagement similar to this has vital potential to speed up decarbonization in the USA by dramatically increasing native entry to renewables for metropolis operations and communities alike.