In the era of global warming, being able to purchase clean energy in a simple manner is incredibly important. Enter Arcadia Power with their easy to use REC, solar, and price alert programs that could save you money while creating demand for clean energy! Check out our review of this digital electricity startup.
In 2017, renewable energy surged to 18 percent, way up from 15 percent in 2016. Companies like Arcadia Power are helping that renewable energy percentage go up. Since 2008, the share of energy from coal has gone from 48 percent to 30 percent in 2017.
- 1 What Is Arcadia Power?
- 2 How Does Arcadia Power Work?
- 3 How to Sign Up For Arcadia Power
- 4 What Plans Does Arcadia Power Offer?
- 5 Arcadia Power Price Alerts
- 6 Arcadia Dashboard Analytics
- 7 Community Solar Program With Arcadia Power
- 8 Amazon Home Efficiency Bundle
- 9 How Much Does Arcadia Save Or Cost You?
- 10 How does Arcadia Power Make Money?
- 11 The Power Of Numbers With Arcadia Power
- 12 Could You Just Buy Your Own RECs? Do We Even Need Them?
- 13 Will I get Clean Energy Electrons?
- 14 Arcadia Power Pros And Cons
What Is Arcadia Power?
Arcadia Power is a company that buys Renewable Energy Certificates (RECs) to allow consumers to back electricity from renewable resources. It’s the first of its kind — a company that sets to create more green energy on the electrical grid and save you money on electricity through data.
Arcadia Power was created in 2014 by Kiran Bhatraju and Ryan Nesbitt in Washington DC. To date, they’ve received $40.5 Million in funding from venture capitalists including Energy Impact Partners, BoxGroup, and Wonder Ventures. They’ve come a long way in 5 years and now have over 175,000 accounts across 50 states.
Arcadia Power doesn’t force you into long contracts and there are no cancellation fees.
Arcadia Power aims to make buying clean energy much easier. Instead of going out and finding a wind or solar farm and negotiating a rate with them, all you have to do is pay a bill at the end of the month that charges you a set extra cost per KWh.
How Does Arcadia Power Work?
In the United States, energy is generated from different sources: gas, coal, wind, solar, nuclear, hydro, etc. Once energy is generated, it goes onto the electrical grid and it all looks the same, no how it was generated.
So how do Arcadia Power users get clean energy? The main concept Arcadia Power hinges on is RECs.
RECs verify that your energy actually came from a renewable resource. When you buy them, they act as proof. When people look at how much clean energy there was in a year, they look at the number of RECs issued to verify renewable energy data. The more RECs that get bought, the easier it is to show companies that they should invest in renewable energy because that is what people are demanding and willing to pay for.
Arcadia Power also has two other programs; one that offers the option to buy solar panels on a solar farm and get the dollar credit for that electricity. The other is a price alert system that shows you the cheapest electricity option and switches you to it. Both of these programs only exist in certain states due to the fact that electricity is extremely regulated, both intrastate and interstate.
How to Sign Up For Arcadia Power
Step 1: Sign Up And Choose A Base Plan: Evergreen or Premium
When you sign up, all you have to do is enroll in the plan that you like. The 50 percent Evergreen renewable energy plan is free and you even get $5 when you sign up.
The 100 percent renewable energy premium plan gives charges 1.5 cents per KWh. The average household uses about 900 kWh per month, so that’s a $9 increase per month for 100 percent clean energy. It also gives you discounts on home efficiency products and special rates on community solar.
Step 2: Choose If You Want Special Programs (Solar, Price Alerts)
Solar panels costs depend on which state’s programs your zip code qualifies for. Since you’re buying the solar panel up front, that’s a large chunk of change, but might save you money in the long run.
Lastly, you can sign up for price alerts if you live in a deregulated energy market. Some states have only one energy provider so this won’t benefit you, but for states with deregulated energy markets and multiple providers, Arcadia Power can alert you to better prices so you may be able to switch. Here in NYC, we only have ConEd, so I didn’t realize in some states you got a fixed rate for electricity depending on a long-term contract! Since we can’t negotiate our electricity bill as there is no other energy provider, I believe we get billed at the market rate of electricity plus some premium.
Step 3: Link Your Utility & Set Up AutoPay
When you finish picking your Arcadia Power plan and special programs, you’ll be asked to link your electricity provider and choose a payment plan. You’re able to pay Arcadia Power by bank transfer, just like your normal electrical bill, but we recommend paying with credit card. Unlike other utility providers who charge a 3 percent fee for paying with credit card, Arcadia Power doesn’t charge anything. It’s a great way to rack up extra credit card rewards!
You pay Arcadia Power every month, and Arcadia Power pays your electricity company. You’re not being charged a middleman fee if you’re on the free plan. It’s the exact same price. For the premium plan, you’re charged a 1.5 cents per KWh for the cost of purchasing a REC.
What Plans Does Arcadia Power Offer?
Arcadia Power offers two plans:
- 50 percent of your energy comes from renewable energy for FREE
- 100 percent of your energy comes from renewable energy for a small surcharge
The 2nd plan is available in all markets, but the 1st one isn’t. For example, they are still working with Con Edison in New York to make the 1st plan available.
If you’re into travel hacking, the great thing about Arcadia Power is you get to pay your electricity bill with your credit card. If you’re confused about the billing process, here’s a quick video from Arcadia Power.
ost electrical companies only allow you to pay with a debit or checking account, so you can’t get rewards from your credit card via them.
Arcadia Power Price Alerts
Arcadia Power has a special Price Alert program available in deregulated energy markets. This means they basically check the price of electricity across different providers and give you savings if they can find one lower than your current provider. Your utility bill is still through your provider, so nothing changes on your end, you just save money on the back end, which is great!
This is a map of energy markets by state. The navy states are deregulated electricity markets, the lighter blue ones are deregulated gas markets, and the striped states are deregulated gas and electricity markets. Who knew the electrical grid was so complex? Each state has its own rules, so Arcadia Power does a good job of parsing all these different regulations.
Arcadia Dashboard Analytics
The interesting thing about electricity is that it costs a different price throughout the day. The market price changes due to supply and demand.
For example, it might be more expensive to use energy at night and during the weekend. This is because everyone is at home and using appliances, air conditioning, etc. The more electricity the grid needs, the more costly it is per KWh. You can see the price per kWh by hour, so if you notice prices going through the roof from 5-9PM, you might want to put your dishwasher and laundry on a timer for 3 AM where electricity costs are much cheaper when everyone else is sleeping.
The same concept applies to gas in times of winter. Gas prices go up when temperatures get colder, and if the grid is overpowered, it could cause an outage. There are tons of ways to save money on electricity and Arcadia Power shows you when electricity is most expensive.
You’ll also be able to see how many KWh you’ve contributed to clean energy and the number of trees equivalent to that clean energy.
Community Solar Program With Arcadia Power
The community solar program is only available in certain states. You can check if you are eligible through the site by entering your zip code and electricity provider.
The community solar program allows you to buy solar panels in a solar farm. Instead of having to install an actual solar panel on your home, which is near impossible in NYC and other large metropolitan cities, you buy a solar panel on a farm and get to net your electricity usage with the production of that solar panel. Depending on where you buy your solar panel, you’ll get different amounts of electricity per month. This is because solar panels produce more electricity in the summer months than in winter months due to the number of hours and intensity at which the sun shines.
Arcadia Power solar will only save you more money if you’re not able to put a solar panel directly on your roof, you don’t live in a state that is sunny all year long, or your panel can’t face south (where the sun shines most). But if you were planning on paying for installation, it might have been cheaper to just buy a solar panel from a solar farm. You can run the numbers yourself, but this is a nice option for people who don’t have the ability to install a solar panel on their home.
Think of it like crowdfunding for real estate but for solar panels. Many small investments can get a solar farm built or grown and leave you with economies of scale so you can enjoy wholesale prices on your solar panels.
The one plan we saw was a $75 upfront purchase stake of a solar panel to get a $1/month credit for 10 years. That means you get $120 back, which means you profit $45 by the end of the program. Of course, you might have ended up with more money if you had put it in the stock market, but this is voting with your dollars for green energy. The plan price depends on where you are in the country and which solar farm you choose to buy your panel.
Keep in mind you don’t have to pay for maintenance costs, labor, etc, the $75 covers it all.
You’ll be able to see your solar panel and how many KWh of electricity it has produced.
For those in NY, MD, RI, and DC, you can still take advantage of the community solar program even if you’re enrolled in LIHEAP. Take a look at the specifics on the site to see if this applies to you.
Amazon Home Efficiency Bundle
Arcadia Power partnered with Amazon to offer a home efficiency bundle for cheaper than market price so you can get started on using less energy. There are 3 plans to choose from. Arcadia Power includes the installation in the package (Amazon charges $135 normally)!
Currently, these are the only cities that participate in the program:
- Orange County, CA
- San Diego
- (SF) San Francisco
- San Jose
- Los Angeles
The Home Efficiency Bundle is pretty cool because you get to pay for it over 36 months with $0 upfront.
There are 6 items the Amazon Home Efficiency Bundle offers:
- Echo Dot (ask it to turn off smart lights, smart plugs, adjust thermostat)
- Ecobee (Amazon’s version of the Nest Smart Thermostat)
- Smart Plug (prevents phantom electricity, control on/off from the phone, set schedules)
- Smart Bulb
- Echo Show (same as Echo Dot, but with a touchscreen, controls Ring Doorbell)
- Ring Doorbell (Smart Doorbell, records door for package delivery, 2-way audio with people at the door, motion-sensor security alerts)
There are 3 plans you can choose from. All are 36-month long payment plans with nothing upfront:
- Starter ($12/month) – Ecobee, Echo Dot
- Basic ($20/month) – Ecobee, 3x Kasa Smart Wi-Fi bulbs, Echo Dot, 4x TP-Link Smart Plugs
- Plus ($36/month) – Ring Doorbell, along with everything in the Basic Package
We priced out the packages individually, and if you’re a DIY installer and can afford to buy the products outright, you might be better off just buying the products and installing them yourselves.
How Much Does Arcadia Save Or Cost You?
Arcadia Power offers a free tier at 50 percent renewable energy usage, so if you want to help the earth by creating more demand for renewable energy, but still pay the same price for electricity, this option is perfect for you! This Tier is free, so that’s the best reason to join.
The premium plan charges you 1.5 cents per KWh. Electricity costs range from $.10 to $.30 per KWh in the United States, with $.13 KWh on average, so the premium is a small percentage of that if you want to support clean energy.
Arcadia Power is betting that consumers care about the source of energy that electricity is generated from. In the age of global warming, Arcadia Power knows there are some consumers who want to vote with their dollars — paying extra for a 100 percent renewable energy plan is one way to increase demand for renewable energy.
If you’re interested in understanding RECs better, check out this video from the US Department of Energy.
How does Arcadia Power Make Money?
I always wonder how companies I use make money. This is because of the famous Facebook debacle. I don’t want my data to be the reason a company makes money. Plus, I’d like to sign up for companies that I know will exist in the future. This means I don’t have to move all my accounts in case they go down after a few months (as is what happens to some startups). Remember MoviePass that everyone loved? Well, it got delisted in the NASDAQ after it became a penny stock, even after a 250-1 reverse split. I’d rather not pay for a service, then not get that service if a company ceases to exist.
Arcadia Power is a new startup, so it’s entirely possible they are still running on venture capital runway. At $40.5 Million in funding, that’s a lot of cash to go through.
However, when taking a look at the REC market, I can see them making money one way — REC arb. If the cost of bundled RECs was $40-$50 in 2015 and unbundled RECs were $1, I’m going to take a wild guess. They are probably buying unbundled RECs. I don’t have current numbers, but please let me know if you find them so I can update this! Considering the average US household uses 11 MegaWatt hours of electricity per year, that’s $300-$420 that Arcadia Power would be subsidizing per person if they were buying bundled credits.
Since Arcadia Power has $40 Million in funding, it would only fund 96,500-135,000 households for a single year if they were buying bundled credits. Arcadia Power has 175,000 accounts and each account must at least get 50 percent of clean energy. Because of this, I’m going to say this analysis shows they’re probably buying unbundled credits.
If Arcadia Power is selling RECs to you at $15 (this is what their 1.5 cents per kWh surcharge implies), and buying unbundled credits at $1, this is a ~$13/month in what they might net per average premium user. Since we’re assuming there are also free users who get 50 percent of their plan from clean energy, there needs to be at least 1 premium user for every 28 free users, which is not a bad ratio at all! Essentially, the premium users are heavily subsidizing the free users. We’re not counting labor, rent, and other expenses here so I’m sure the number of free users has to be fewer than 28.
In terms of solar panels, it’s possible they take a small cut for each solar panel you buy or they get a commission from the solar farm. Lastly, all their home energy saving devices are from Amazon. It’s possible they’ve partnered with them on that by buying in bulk and selling to you at a small discount from the market price.
Of course, it’s possible they are not making any money right now. They could be just waiting to build more market share so they can negotiate better energy prices for everyone and get a small cut from that.
In any case, Arcadia Power seems to be a quickly growing startup, and I’m hopeful they’ll stay in the game and revolutionize our electrical grid’s energy sources. After all, we want the air to be fresh, the water to be clean, and food to be plenty for our future generations, right? Paying a little more in the short term for clean energy is a price I’m willing to pay.
The Power Of Numbers With Arcadia Power
There is always power in large numbers when it comes to negotiating and Arcadia Power is no different. Due to the support of the 100,000s of customers, Arcadia Power now gets clean energy 10 to 25 percent off the market rate. The reason this happens is because of higher competition for Arcadia Power users.
The more users Arcadia Power has, the bigger the market signal that people do care about clean energy. This means more companies are likely to invest in new wind and solar farms. More engineers will work on better wind turbine and solar panel technology. This creates a viral feedback loop to further incentivize companies to work on renewable energy technology.
You’ve no doubt experienced climate change these past few years with the polar vortex. Scorching hot summers and incredibly freezing winters are just a few of the byproducts of climate change. With Arcadia Power, you can contribute to a greener and cleaner future while saving money as well.
Could You Just Buy Your Own RECs? Do We Even Need Them?
To recap, one REC is the equivalent of 1 MegaWatt hours of clean energy. The average household in the United States consumes .867 MegaWatts hours per month.
While it looks like you could buy your own RECs, I still couldn’t figure out how to do it online. Also, it’s likely Arcadia Power gets a discount on their REC costs due to their bulk volume. In any case, if you are pinching pennies, you can try and purchase your own.
Arcadia Power’s REC cost to you is $15 per REC if you are on the premium plan. Depending on if Arcadia Power is buying bundled RECs ($40 to $50 in 2015) or unbundled RECs (very cheap at $1), you should take this cost into consideration before trying to buy your own. Bundled RECs are from your local energy provider, so you’re providing more clean energy to your local city or state (or however far your energy provider extends). This means you’ll reap the benefits of cleaner air and other benefits if you’re getting bundled RECs. However, this is 3-4x as expensive as simply going through Arcadia Power, so if you’re attempting to buy bundled RECs, I’d just go with Arcadia Power.
Unbundled RECs are from a provider that you do not pay for energy. For example, our NYC energy provider is ConEdison. Any REC we buy that is not from ConEdison is considered to be an unbundled REC for us.
Another thing to consider in supporting RECs is that some energy projects pre-sell RECs for the future. This means people pay them for the potential of future RECs. If the project fails, people might not get their RECs.
Will I get Clean Energy Electrons?
Just to reiterate how RECs work, being a part of Arcadia Power’s plan doesn’t mean there’s a separate delivery system for dirty vs clean energy.
It just means the equivalent amount of RECs in your plan was used to purchase clean wind energy. This doesn’t mean the electricity in your house now comes from clean energy — you’ve just paid a clean energy company to create the energy and put it on the grid for you in the US.
Arcadia Power has a network of over 100 clean energy producers in the US that do this. Every KWh you purchase of clean energy means one less non-renewable resources we use overall. The more RECs purchased, the dirty energy can fade. This allows us to make the word one step greener at a time. Here are some of their partners:
- New Columbia Solar
- Forefront Power
This is awesome because even if you aren’t located directly need to a clean energy producer, you can still help the environment by making sure clean energy gets onto the electrical grid with Arcadia Power.
Arcadia Power Pros And Cons
Arcadia Power Pros
The free plan where you get 50 percent clean energy is a no-brainer. You get to create demand for clean energy for 50 percent of your electricity usage
The 50 percent clean energy plan is free. FREE! There’s even a $5 bonus for signing up.
You get to get credit card rewards since Arcadia Power lets you pay with credit card and doesn’t charge you a fee.
The dashboard is very intuitive to use and support is easy to contact.
You can buy solar panels on a solar farm and a discount on home efficiency goods through Amazon.
Arcadia Power Cons
They don’t have the free plan everywhere, so check if they are available in your zip code. The premium plan charges $14 more per month for average electrical household usage, which you can estimate in your dashboard.
Arcadia Power is a 5-year old startup, and is probably the only startup I can think of that is trying to revolutionize putting more renewable energy on the grid. Startups sometimes fail so if this happens, you’ll have to migrate back to your old way of getting electricity.
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