Most audio apps - including CEP - group plugins by function.

TBF default groupings are often based on the function baked into a VST/AU by the designer, and some of those groupings are more useful than others.

But given that Audacity's plugins are largely homebrewed, I don't there's a good reason not to get this right.

I find these kinds of problems baffling. And it's not that they're exclusive to open source, because they really aren't. (I'm looking at you, Adobe...)

Some designers just don't seem to get UI concepts like making common workflows as streamlined and effortless as possible, minimising clicks and scrolling, efficient presentation of options with useful grouping, and watching non-dev users interacting with the software to find out what feels clunky and excessively complex to them.

IMHO alphabetical is much better if you already know what you want to do. I want to do Noise Reduction, I open the Effects menu and click on Noise Reduction, which I can find very quickly because it's alphabetical and I know the name. If it were sorted by category then I would have to know beforehand not just the name of the effect but also the category it's in, and from experience with other programs it can be pretty arbitrary/subjective/confusing to have to remember the plugin -> category mapping for every plugin I ever use. Otherwise I have to parse a bunch of categories and think "hmm, I wonder if they would put Noise Reduction in here..". Either way it's slower and more of a hassle.