When one thinks of Illinois, a couple things usually come to mind. First, there is Abe Lincoln, who made his political career in the state. Then, of course, there is Chicago with its sports teams and deep-dish pizza. Downstate, there is all that corn and soybeans. Oh, and don’t forget political corruption — Illinois has sent two of its last four governors to prison.
Soon, however, Illinois might bring to mind images besides Lincoln memorials and Windy City corruption scandals, like solar panels and wind turbines. A new report issued by a coalition of environmental groups shows how Illinois communities have tapped into the renewable power market in a big way. It’s good news for a state long dependent upon coal and nuclear power for its energy needs.
The story of renewable energy in Illinois begins in 2009, when the state passed into law legislation allowing for Community Choice Aggregation in the state’s retail electricity markets. Put simply, the CCA model allows communities to bundle together the electricity demands of a city or town’s residents and businesses, thereby giving greater market power to consumers when they go to negotiate electricity contracts with utility companies. By negotiating as a group, consumers can collectively negotiate better deals and, more importantly, they can demand that renewable energy production be part of any final agreement.
Communities across the state of Illinois have, in turn, taken to the new model in droves to push through greater production of renewable power — something that consumers have demanded for a long time, but for technical and economic reasons, has been ignored by the vested interests of the state’s utilities and electricity providers. With market power now in the hands of consumers, however, utility resistance to renewables is beginning to crumble. Already, over 90 Illinois towns and cities representing nearly 1.7 million people across the state have used CCA bundling to go totally renewable.
In fact, Illinois’ adoption of CCA bundling is higher than any other state, and it’s clear that this is just the tip of the iceberg. So far, nearly 75 percent of communities in the state have voted in referenda to implement some sort of CCA bundling for their area, and of the 600 that have chosen to organize their procurement of power in this way, nearly 1 in 6 — the 90 towns mentioned above — have chosen the 100-percent renewable path. Many of the remaining 500 or so CCA communities in Illinois also have renewable power production mandated as part of their collective electricity portfolio or otherwise allow consumers to purchase renewables on their own.
This is important because the potential for more communities to go totally renewable is there. So long as technology continues to improve and prices continue to fall, one can expect that the percentage of CCA communities choosing renewable power will only increase. This is especially true because CCA contracts with power producers typically only last a couple of years, allowing consumers to quickly take advantage of changing long-term prices in the state’s energy markets.
Communities, in other words, are not stuck with coal-fired or nuclear energy plants simply because their local utility built them. Instead, they can shop around for cheaper, cleaner providers, thus prompting intense competition in what has historically been a staid power market dominated by monopolistic utility companies. By giving power to consumers, CCA bundling increases choice by forcing utilities to compete for consumers’ electricity dollars by producing what they want, whether what they want is cheaper power, cleaner power or both. What we have, then, is an Illinois version of Germany’s energy transition, but one that is arguably much more market based, as it is driven by consumer demand and is being built, community by community, from the ground up rather than being mandated from the top down.
Furthermore, this is not just a scheme for small towns. The city of Chicago, for instance, has used the power of its 900,000 bundled electricity consumers to force a fundamental change in the way utilities provide power to this vast urban market.
Prior to the use of CCA bundling, over 40 percent of Chicago’s power came from coal. After soliciting bids from energy suppliers after Chicago bundled consumer demand, coal use was eliminated by a shift to cleaner natural gas, and 5 percent of the city’s energy was given over to in-state wind power.
As a result, Chicago’s carbon footprint shrank by 16 percent, consumers got lower rates and a huge amount of air pollution was eliminated. This seemed an impossible feat at the beginning, with power companies scoffing that it could not be done. As Chicago’s sustainability chief, Karen Weigert, has since pointed out, however, “electricity is a market and when you ask a market for something they can provide it.” This is especially true, it would seem, if there is a huge block of consumers capable of negotiating as a group — something power companies can’t afford to ignore if they want to remain profitable.
Going forward, one can imagine that slowly but surely, CCA bundling will allow communities to have the best of both worlds: cheaper power and cleaner power. So far, Illinois has gone the furthest down this road, but others are following. Five other states — California, Massachusetts, New Jersey, Ohio, and Rhode Island — also have versions of community power bundling laws that have proven quite popular.
In Ohio, for instance, both Cleveland and Cincinnati have used consumer bundling to demand and receive 100 percent renewable power for their citizens through the use of renewable energy credits. In the process, they’ve also saved 20 percent in costs.
What all this means is that the lock on our dollars by entrenched fossil fuel interests is not something that is foreordained. With just a few small changes in public policy, citizen consumers can force immense change in economic sectors long thought immutable to outside forces.
Communities in Illinois and other pioneering states across the country have shown that when people organize using both the ballot box and their pocketbooks, immense good can come of it. That, more than any energy conservation or environmental preservation, is good news worth celebrating.