Local Power Choice Hampered by New California Rule

Local communities have taken the incentive to procur their own electric and gas power, but the big power providers don’t like it, so they went to the state of California to do something about it.

To no one’s surprise, California complied with the request from the large power companies and created a rule change to help tilt the advantage back in the favor of the large power companies.  Maybe someday there will be a separation of corp and state, but not today, and certainly not in California.

California Sets New Rules for Community Choice Aggregators

Community-choice aggregators, or CCAs, have become a force that cannot be ignored.

In California, CCAs are cities or counties that have taken over key aspects of their own electricity and natural-gas procurement, distribution and sales from one of the state’s three big investor-owned utilities. From a slow start in 2010, the ranks of CCAs have grown to include eight operational entities with more than a dozen more being formed or expanded at present, representing 1.85 million customer accounts.

According to the advocacy group CalCCA, this growing trend can claim credit for saving tens of millions of dollars in customer energy costs, and nearly 1 million megatons of carbon emissions in renewable energy purchased, on an annual basis. These kinds of benefits have led to CCA legislation being passed in states including New York, Massachusetts, Illinois, New Jersey, New York, Ohio and Rhode Island.

But to the state’s investor-owned utilities, Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric, CCAs are an existential threat to their business models — a mechanism that takes away their customers, while leaving them with the burden of managing the power lines, maintenance crews, and the customer service platforms that keep the system running. How those costs are shared between CCAs and utilities has been a longstanding point of contention between the two, with the California Public Utilities Commission serving as the referee.

Last week, the CPUC adopted a resolution that will force future CCAs to take up at least one part of this common burden — resource adequacy, or the need to procure enough energy to meet the grid’s need when energy demand is peaking.


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Paul Gordon is the publisher and editor of iState.TV. He has published and edited newspapers, poetry magazines and online weekly magazines. He is the director of Social Cognito, an SEO/Web Marketing Company. You can reach Paul at pg@istate.tv