What is Community Choice Energy?

What is Community Choice Energy? Community Choice Energy, sometimes referred to as “Community Choice Aggregation” or “CCA”, is a program that brings local control and freedom of choice and competition into the electricity marketplace. Currently, San Diego has only one electricity provider San Diego Gas & Electric (SDG&E)– a de-facto monopoly. Community Choice allows cities and counties to purchase power on behalf of their residents and businesses to provide cleaner power options at a competitive price.

SDG&E would continue to deliver the power over their power lines, provide customer service and handle the billing. It is an agile public-private partnership. SDG&E, like almost all utility companies, publicly states they support a customer’s right to choose an alternate energy provider, but they fight it with their lobbying and political spending. Whether San Diego moves forward to provide this option is where CAC steps in.

CCA-MonopolyvsChoice

How will Community Choice Benefit San Diegans?

Choice. In the past, there was only one electricity provider.  A local community choice program offers you a choice of providers and creates competition that encourages innovation and improved pricing.

More clean energy. The local community choice provider can reduce the region’s carbon footprint by providing a higher mix of clean energy sources than the existing monopoly utility. In Sonoma County, for example, the default electricity service of their community choice energy program (Sonoma Clean Energy) provides 1.5 times more renewable energy than the area’s traditional utility, Pacific Gas & Electric, and creates 30 percent less greenhouse gas emissions. In addition, Sonoma Clean Energy’s optional EverGreen service is 100 percent local, clean and renewable – the first service of its kind in California!

Local control. In the past, electric rates were set without any input from San Diego customers. A local community choice program gives us local control and accountability of our rates.

New markets. Today, millions of dollars leave San Diego to pay for electric generation. Over time, a local community choice program can buy increasing amounts of power from local sources, helping support local jobs and local economic development.solar_square

Local programs. Today, millions of dollars are collected from San Diegans every year to use for energy efficiency and clean energy programs, but we have little say about what those programs entail and how and if they will benefit our region.  A local community choice program can apply to use some of that money to develop new programs and incentives better targeted to our needs.

Cost. Community choice energy programs offer competition in the marketplace that allows the transition to 100% clean energy to be achieved at reasonable, competitive rates for cities, families, and businesses.

What are the costs like for other Community Choice Programs?

Costs for other CCAs for their standard options have been able to beat the rates of the competing utility. Check out the commercial and residential rates for Sonoma’s community choice program compared to the old utility, PG&E

Offering competition in the marketplace allows the transition to 100 percent clean energy to be achieved at reasonable, competitive costs for cities, families, and businesses. For example, Sonoma Clean Power provides customers with a standard option that has more clean energy at cheaper rates than the local utility, PG&E. In addition, customers can chose to power their businesses with 100 percent renewable energy by paying only 10 percent more per month than they would have paid to PG&E to receive less than one-third the amount of clean energy. For more details, check out the bill comparisons for business customers and residential customers

How Do You Pay for It?

Community Choice Energy programs are revenue-based, not government subsidized. That means they’re self-supporting from an existing revenue stream (electricity bills). The electricity rates consumers pay to a retail electric supplier or an investor-owned utility are bundled and redirected to support the group purchase of electricity through a local CCA program.

Where is Community Choice successful?

Source: Clean Power Exchange. Click on the map for an interactive version of this map at CPX’s.

Operational Community Choice Programs in California:

Emerging Community Choice Programs:

Exploring Community Choice:

  • City of San Diego
  • County of San Diego
  • Cities of Del Mar, Encinitas, Oceanside, and Carlsbad
  • Riverside County
    • Taking steps to buy its own electricity (8/22/16): READ MORE
  • City of Solana Beach
    • This tiny town has found a new way to cut GHG emissions (8/10/16) READ MORE
    • Solana Beach seeks electricity options (7/15/16): READ MORE
  • Alameda County:
    • Doing CCA Study, August 2015 – READ MORE
  • City of Davis
    • City of Davis Considers Joining Marin CCA (May 21, 2015) READ MORE
  • LA County
    • Votes to Explore CCA (3/12/15): READ MORE
    • Los Angeles Community Choice on the Move (7/5/16): READ MORE

What’s the difference between Community Choice Energy, Municipal Utilities, and Investor Owned Utilities?

Unlike non-profit municipal utilities, or “munis”, CCE programs do not face the capital-intensive and open-ended challenge of valuing, purchasing, and maintaining expensive utility infrastructure. The CCE model offers a hybrid approach that exists between the investor-owned utility (e.g. SDG&E) and a municipal utility. Community Choice Energy programs reap the benefits of controlling power supply and generation without the financial drag of purchasing and maintaining sometimes antiquated utility infrastructure. In this way, it is a great option for municipalities who want control over their power supply, cost efficiency, and flexibility, but don’t want the financial and operational burdens of owning their own utility.  Here’s a great graphic from LEAN Energy explaining the difference between CCE, Munis, and IOUs:

CCA-Utility-Chart-LEANenergy

 

What do I need to get started? Where can I find more informational resources?

Community Choice Energy exploration begins with education and engagement of government officials and the community. A typical official first step is to identify funding and obtain the energy load data from the local utility to conduct a technical feasibility study.

Sample “declarations to pursue”, resolutions and ordinances, Join Powers Authority Agreements, Technical Study examples, and Implementation Plans can be found on Clean Power Exchange’s Resources page.

Additional informational resources, sample documents, and FAQ can be found at Marin Clean Energy’s resources page.

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