Originally published at Green Energy Times.
All the customers of Cape Light Compact, in the 21 communities on Cape Cod and the island of Martha’s Vineyard, will get 100% of their electric power from renewable sources by the end of January 2017.
At Green Energy Times, we have been watching with a bit of awe as countries, states, and cities throughout the world have turned to 100% renewable electric power. Of course, some places had been that way all along. Paraguay, for example, has produced about 10 times as much electricity as it needs from hydropower, and Iceland uses both hydropower and geothermal sources.
New places have been joining that short list, however. A few years ago, we found that the Pacific island nation of Tokelau had claimed a place as the first 100% solar-powered country. With passing time, other islands and towns with names we did not recognize turned to 100% renewable power. Güssing, in Austria; Wildpoldsried, in Germany; Samsø, in Denmark, have all been mentioned in Green Energy Times.
We have watched as states and countries have become 100% renewably powered. The German states of Mecklenburg-Vorpommern and Schleswig-Holstein produce more renewable power than they consume. Paraguay is entirely renewably powered. Most recently, Costa Rica has gone for about a year without using fossil fuels for electric power and continues to install renewably powered infrastructure.
Only a few cities and towns in the United States have achieved this same exalted status. Greensburg, Kansas, was the first city, though its size is small. Burlington, Vermont; Aspen, Colorado; and Palo Alto, California, make up the rest of a short list of our cities that claim to be 100% renewably powered.
Recently, however, we woke up to the news that the Cape Light Compact (the Compact), an energy services organization operated by 21 towns and two counties on Cape Cod and Martha’s Vineyard, is signing onto 100% renewable power. The Compact is a community aggregation system that combines purchasing power of all ratepayers in their area.
Community aggregation is used to leverage the purchasing power of large groups of electric customers in an effort to negotiate favorable rates, terms, and conditions. This helps ensure that electric customers do not become disenfranchised in de-regulated electricity markets. It has also been used to ensure that sustainable power supplies are used. The June 2015 edition of Green Energy Times carried an article, “Greenfield is Green,” on community aggregation in Massachusetts.
The Compact’s sudden switch to renewable power was not as sudden as it appears. The Compact selected NextEra through a competitive process in 2014. The relationship turned out to be good enough that the Compact chose to extend their agreement through 2018. It happens that while NextEra still owns fossil fuel and nuclear generating facilities, it has been acting aggressively to switch to sustainable energy. NextEra Energy Resources’ portfolio of renewable generating infrastructure is very impressive, and has more wind power capacity than any other North American company.
Impressively, NextEra started a fund, EarthEra Renewable Energy Trust (EarthEra), to manage revenue from renewable energy credits (RECs). Separately, Massachusetts has produced its own structure for dealing with RECs within its Renewable Portfolio Standard (RPS). Add to these some very interesting policy by the Compact, and RECs take on a very different meaning than some people might imagine.
EarthEra is operated by an independent trustee and is funded through RECs produced by NextEra and its subsidiaries. The trust is dedicated 100% to developing new renewable energy facilities, ensuring that the original purpose of RECs, incentivizing renewable energy, is honored. Working with NextEra and the Compact, EarthEra preferentially funds renewable energy in New England, near where Compact customers use it.
Massachusetts specifies a portion of the power utilities buy to be generated renewably, and the portion increases annually. The details of the RPS require that a portion of the RECs be from facilities that are approved by the state, preferring local facilities and those considered new, as defined by the program. RPS-approved RECs must be retired, and may not be resold, to ensure the purpose of the RPS standard is upheld.
The Compact has done this one better, by insisting that NextEra exceed the state’s specified percentage of renewable energy sold, using local renewable energy resources for some of the extra renewable energy. This has resulted in REC purchases from the New Bedford Landfill and a set of large solar arrays on rooftops within the Compact’s service area.
While it may appear confusing, the agreement means 100% of the electric power used by ratepayers on Cape Cod and Martha’s Vineyard is from renewable sources. Some of those resources are on Cape Cod and Martha’s Vineyard, and the RECs involved are used to develop renewable power, preferentially in Massachusetts and New England. This provides local incentives for local power.
Not only has a significant area of Massachusetts turned powerfully to renewable energy, setting a new standard for the Northeast and the country, it appears that this has been done thoughtfully, with an honest effort to reduce our carbon emissions and the pollution from fossil fuels.
Well done, Cape Light Compact, NextEra, and Massachusetts!