Municipal aggregation is a process by which some Massachusetts cities and towns aggregate the demand for electricity in their community and bulk purchase electricity from a supplier on behalf of their residents. Think of it as group purchasing: Municipalities buy electricity in bulk, and as a result, they can lock in cheaper, more stable electricity rates which they can then offer to their community members.
Aggregation programs are typically offered as alternatives to basic utility electricity plans. Thanks to energy deregulation, Massachusetts residents, businesses, and municipalities can now choose where they source their electricity. If a municipality has voted to initiate an aggregation program, then its community members will automatically be enrolled on that electricity plan unless they choose to opt out. Residents who opt out can either choose to remain on their local Massachusetts utility plan (likely from either Eversource, National Grid, or Unitil)—or they can shop around for their own electricity supplier.
Municipal aggregation is designed to provide residents and businesses with cheaper electricity rates, since your city or town is purchasing the plan in bulk and can negotiate with the supplier for a lower rate. In addition, aggregation also allows municipalities to have a say over how their electricity is being sourced. For example, many municipal aggregation programs opt to purchase their electricity from greener electricity suppliers to support renewable energy generation in their community.
Municipal aggregation is made possible by energy deregulation. In Massachusetts, energy users have the ability to choose where their electricity is sourced, rather than having to automatically receive electricity from their local utility. Cities and towns can take advantage of this option by voting to initiate a municipal aggregation program.
Once a municipality votes in favor of aggregation, the local governing body will work with the Massachusetts Department of Energy Resources to come up with a plan for how they will source their electricity. The process is fairly collaborative, and local community members are given the opportunity to review the aggregation plan before it is submitted to the Massachusetts Department of Public Utilities for approval.
Once approved, the municipality will start to procure its electricity from its chosen supplier. It’s important to note that the local utility will still provide transmission and distribution services. The only thing that changes is the source from which the utility receives its electricity. This is indicated as the “supply” charge on your electric bill.
One last thing to know is that municipal aggregation programs are always optional. When the program begins, residents and businesses will be given the option to opt out of the program and choose to either continue on their local utility’s electricity plan or search for a new plan with a third-party energy supplier. Energy users who do not initially opt out of the program will be automatically enrolled in the program but will have the option to opt out any time they like.
Community Choice Electricity (CCE), also referred to as Community Choice Aggregation (CCA), is another name for municipal energy aggregation. While they are sometimes referred to differently, they work the same way.
Communities can create a Community Choice Aggregation or CCA plan to purchase their electricity from a third-party supplier that meets the criteria set by the plan. CCAs are designed to give municipalities more agency over their energy sourcing. Many CCAs provide access to cheaper electricity rates for community members. Boston is one such notable Massachusetts city that recently implemented a CCA/CCE program.
Municipalities can also use CCA to green their electricity supply. This arrangement is often called a green aggregation.
Green aggregation is a type of municipal aggregation where a municipality decides to meet more than the state-mandated renewables target. This is often achieved through the purchasing of extra renewable energy credits (RECs) to offset their electricity usage. Municipal aggregation enables municipalities to purchase renewable energy at scale for more affordable rates. Like all municipal aggregation, green aggregation is an opt-out program, meaning you will automatically be enrolled in your green aggregation program unless you choose to opt out and go with your local utility or a third-party energy provider.
Municipal aggregation is intended to provide residents and businesses with cheaper, more stable, and potentially cleaner energy plans. By aggregating demand and making a large purchase, municipalities can negotiate cheaper rates and better long-term plans with energy suppliers.
The main benefits of municipal aggregation are:
Municipal aggregation is always optional–you will always have the opportunity to opt out of the program if you like. But whether you should opt out depends.
Energy aggregation programs are intended to provide residents with more affordable, consistent electricity rates than they would otherwise receive from their local utility. However, just because you’re receiving a “better” plan than you would from your utility doesn't mean you’re receiving the best plan on the market—or the plan that most closely matches your priorities (in terms of low price and environmental friendliness).
The number one way to ensure that you’re on the energy plan that best suits your preferences is to take some time to compare rates and quality of energy source between your local utility, your aggregation program, and third-party energy suppliers.
The quality of energy sources matters because, besides price, you might want to consider how clean your energy plan is. Municipalities often will choose energy suppliers that offer green energy plans. And while many utilities in Massachusetts have also adopted renewables as part of their supply, municipal aggregation programs can often secure even greener plans than the utility.
However, your aggregation program still may not be the greenest plan available. So if you’re an eco-conscious consumer looking to reduce your footprint as much as possible, you may want to opt out of your community aggregation program and explore the supplier marketplace.
That’s where Perch helps.
We’re here to do the hard work for you. Perch will compare plans and rates across the utility companies, the community aggregation program, and the supplier marketplace. You tell us if you want to stay on a standard “mixed” plan, meaning energy backed by part fossil fuels, part renewables (this is what basic utility electricity offers), or if you want a plan backed by 100% or more renewable sources like solar and wind.
Based on your desired energy preference, we’ll then match you with the right option and switch you without any interruptions to your service. The best part is, we try to find you the cheapest plan compared to similar options in the market, and cheaper than the average market rate. And Perch only makes money when we save you money, because our ultimate goal is to bring customers savings* compared to the prices available in the market.
Perch is here to offer eco-conscious and savings-conscious consumers an alternative option to municipal energy aggregation.
*While Perch will ensure you save money on an annualized basis, Perch cannot guarantee that on any particular day you will always be on the lowest plan available. When you choose 100% renewable, savings are based on a comparison to the Perch Green Index (PGI). Learn more about the PGI here.
Perch is on a mission to make cleaner energy more accessible, more affordable, and more equitable for all.
And we didn't stop with just our electricity supplier switching service. We also help Massachusetts residents get matched with local community solar farms.
Whether you rent an apartment, own a home, or run a business, community solar is a fantastic way to save money on your electricity bills and help the planet, too. For guaranteed savings on your annual electricity cost, join a community solar project in your city or town.
Perch will help match you to a local solar farm—you'll support the operations of that farm so that it can generate and contribute as much clean, solar energy to the overall grid. You don't directly receive electricity from the solar power you're supporting, but thanks to government incentives, you'll get credits toward your own utility bill. Essentially, you're being rewarded with discounts on your own electricity because you're enabling solar generation and development in your state.