How Leap is mitigating power price spikes for California Community Choice Aggregators

How Leap is mitigating power price spikes for California Community Choice Aggregators

August 1, 2022

Leap and other grid stakeholders at the state and regional level are working together to advance grid resiliency and renewable energy goals.

Community Choice Aggregation (CCA) enables local governments to purchase energy on behalf of their residents from different power suppliers than their utility providers. A powerful tool for meeting municipal decarbonization goals, CCAs allow communities to aggregate their purchasing power in order to negotiate better electricity rates and purchase energy from cleaner sources.

Leap works with CCAs in California to enable our network of demand-side flexible resources to help meet energy demand in their service territories. By purchasing flexible capacity from our marketplace of distributed energy resources (DERs), CCAs can reduce the amount of power they need to purchase from dirty sources when renewable energy is in short supply.

The California Choice Energy Authority (CalChoice) assists communities in CCA participation by providing a suite of experts versed in overcoming common roadblocks such as navigating state approval, managing the transition from traditional power companies and engaging with potential customers to distill the complicated process and communicate how they ultimately benefit from CCA participation.

With extreme weather events increasingly taking their toll, California is grappling with power supply shortfalls this summer. Heat, wildfires and drought strain the grid and lead to spikes in wholesale electricity prices that drive up energy bills for California residents.

To make it easier for DERs to help CCAs address these supply shortfalls, we’re now partnering with CalChoice to launch a seasonal program to establish fixed rates for the purchase of power from DERs during peak hours. This new solution will ensure adequate energy supply for CalChoice’s network of CCAs while mitigating against volatile prices in the wholesale energy market. Our technology partners across California who develop and operate DERs, such as EV chargers, smart building technologies and battery storage systems, are compensated for offering their flexible loads on set dates and hours during the week with access to locked-in energy payments. Establishing consistent prices for the flexible capacity sold into the market provides Leap’s partners with more predictable revenue streams for their grid contributions.

Our new program, which operates from June through October, supplements CalChoice’s services and protects its network of CCAs against costly price spikes due to high demand during unpredictable events such as heat waves. We’re excited to continue deploying innovative solutions to leverage distributed resources to bolster grid reliability, mitigate energy price volatility and lower carbon emissions on the California grid.

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