Community choice aggregation (CCA) is a policy wherein decision-making power over energy procurement is shifted from investor-owned utilities (IOUs) like Southern California Edison or Pacific Gas and Electric to locally-controlled public agencies.
CCA is a policy hold-over from the electricity crisis of 2000-2001, and thus emerges as a possible way to “deregulate smarter” by giving communities, rather than individuals, the right to aggregate their energy demand and procure energy as communities. Communities may be defined as cities, or assemblages of cities, or counties, or assemblages of counties. CCAs are a rare opportunity to shift power, since the policy carve-out predates the social movement associated with it.
The promise of CCA is to be able to use local control as a mechanism that enables us to make good on substantive commitments to local generation, local jobs, and higher renewable content in our energy. One of the most important problems with our current energy system is that it is centralized and corporate-owned. As such, communities have no chance of directly guiding our energy choices, and because energy is generated far from users, communities are precarious in the event of natural disasters. CCA speaks to energy democracy goals because it articulares a structural change that puts us in power.
Right now, there are three major threats standing in the way of successful CCA operation. The first comes from IOUs and relates to cost. CCA policy does not necessarily change distribution and transmission of energy, which is still managed by IOUs. This makes CCAs more financially feasible, since they need not develop their own infrastructure from day one, but it also makes CCAs more vulnerable to IOU machinations. Because IOUs have convinced legislatures and regulatory bodies that the IOUs must remain solvent to maintain their transmission lines, as well as to remain providers of last resort, exit fees are levied against ratepayers whose load departs to CCAs, which drives the cost of CCAs up. That means that, in order to remain cost competitive and keep their customers, CCAs must procure energy at a much lower rate than IOUs. This in turn can cause CCAs to pursue cheap energy from out of state, rather than more expensive energy generated close to home. A possible, though unpopular, solution to this problem could be to seize public infrastructure for the public, refuse to pay exit fees, curve the payment structure so that wealthy residents pay the increased cost of energy for the poor, and interrogate the ideology that ratepayers will necessarily refuse to pay higher prices for clean energy that is sourced close to home.
The second threat comes from the California State Government, especially in the form of the California Public Utilities Commission (CPUC). The CPUC is an unelected agency that was designed to regulate privately-owned public utilities in California. The CPUC and IOUs have a history of incestuous relations, and the current president of the CPUC, Michael Picker, has this month declared that the mission of the CPUC is to protect IOUs. In addition to injecting regulatory risk into conversations surrounding CCAs, the CPUC has recently dramatically increased exit fees that CCAs must pay to IOUs as their customers leave. This move will have dire consequences for CCAs, and is expected to shift $300 million onto Alameda County’s CCA. These costs could mean either higher costs for customers, which could trigger opt-outs and render programs infeasible, or they could simply squeeze CCAs and prevent them from engaging in local renewable generation and distribution projects that threaten IOUs.
The CPUC has justified its decision to increase exit fees by claiming that the increased rates “level the playing field” between generations-old IOUs and fledgling CCAs, and by calling the current rate of CCA increase “unsustainable” without reforms. We must fight against these decisions in every way possible.
The third threat is connected to the political gulf that exists between North and South County. Santa Barbara County has done an excellent job putting together a CCA plan and running a feasibility study that shows that the CCA can be economically feasible in the County. To make it work, we’ll need to convince cities in North County to get on board. This is a challenge because of the relative dearth, with some notable exceptions, of environmental activism in North County to push the issue. CCAs are largely seen as potentially costly and unnecessary in the North, and this is likely to be even more the case with the recent decision regarding exit fees at the CPUC. Attempts to communicate the importance of the structural shift of CCAs, as well as the social and environmental benefits of local renewable generation, to populations and politicians in the North have been difficult. One of the best ways to communicate the importance of CCAs in conservative areas is to demonstrate that CCA has benefits for community economic and environmental resilience, that it can mean cost-savings to customers and economic development, that it could mean less bureaucracy, and that it could mean more power for local actors over where they source energy. As the success of the CCA in Lancaster has shown, when energy programs can be successful in conservative areas when those programs first satisfy calls for local control and other conservative values.
Right now, there are some important things we can do to help.
First, we’ll need community steering to keep us on track for our goals. This will require engagement from the community whenever CCA is up for discussion at the County and City levels. A lack of community steering could mean that we end up procuring out energy from out of state, it could mean that we don’t try to build local renewable generation, it could mean that procurement duties are foisted onto other companies that surely would not have our best interests at heart.
Second, we can keep the pressure on IOUs for other nefarious behaviors. SCE and PG&E have been responsible for wildfires in the state, and they have pushed through policy to shield themselves from liability. Now is a great time to undermine their legitimacy, which could later help us free ourselves from their clutches.
Third, we can support those County and City representatives who have supported CCA, and demand that statements against the CPUC be issued by local, environmentally-inclined governments. CCAs are an important way for us to meet our 100% Renewable goals in Santa Barbara, so that too can be leveraged in favor of the CCA.
Fourth, and most importantly, we can reach out to North County and help mobilize pro-CCA campaigns there. SBCan is one of the most important groups working in North County to advocate for CCAs. Community Environmental Council has led the charge from day one, and they too have reached out to North County.
Community Environmental Council has been the incubator for CCAs in the South Coast for years.
CAUSE is involved with strategic energy planning, though less attention has been paid to CCAs.
World Business Academy has been working on local renewable generation plans and strategies for how to meet our energy needs here at home, and they have supported CCA.
Sierra Club has supported CCAs and importantly connected the CCA to Santa Barbara’s City 100% Renewable goals.
350SB has had a number of important discussions about how to help the CCA movement.
SBCan is leading talk up North on CCAs.
IBEW #413 has expressed strong support for the CCA, as long as the CCA prioritizes local renewable generation and union labor.
California Alliance for Community Energy has helped strategize for community energy California-wide and has provided assistance working through regulatory problems.
…and many more!