Irvine is considering switching from Southern California Edison to a greener source of power for its residents, ideally at a lower cost.
Edison still would deliver the energy and bill its Irvine customers.
In September, the Irvine City Council commissioned a feasibility study on this approach, called Community Choice Aggregation (CCA) or Community Choice Energy, which already is serving eight million customers statewide.
But Community Choice still is in its early days, giving rise to questions about what it will cost customers to retain or leave their legacy energy systems.
One of the local catalysts for Community Choice is Robin Ganahl, Orange County organizer for the Climate Action Campaign, a Southern California nonprofit which advocates for local policies to halt climate change.
Ganahl recently sat down with Voice of OC to answer questions about how Community Choice might work in Irvine and other Orange County cities. The interview was edited minimally for space, clarity and continuity.
Q: If I am a resident of a city that decided to set up Community Choice, what is going to change for me? What are the benefits?
It’s already working out very well in over 160 cities in California. Most people won’t notice any difference in their service and there’s nothing they have to do, but the goal is to stabilize our electricity rates and eventually lower them while providing a greener mix of electricity for an entire city. That’s a much faster way than hoping everyone would install solar panels on their house – not everybody can do that.
Q: Irvine started a feasibility study in September to consider Community Choice in the city. The result should be released in April. Then what happens?
The feasibility study should tell us if the city council can purchase electricity and provide it to residents and businesses of Irvine at the rate that is competitive with SoCal Edison, and how they would do that, and where there would be cost savings for the residents and businesses.
So they’ll get the results of the study back, and then we’ll know if it is financially viable. The City Council will then have to vote to pursue an implementation plan that they would then file with the state regulator, the California Public Utilities Commission (CPUC).
Once they do that, they get on a path; the CPUC sort of puts them in a queue and gives them a date for when they can launch. There is a waiting period because the utility needs to know [how many customers they will lose] to not purchase electricity on behalf of those residents any more….So, if they were to file a plan by the end of this year, they would launch it in 2021.
Q: Right, because customers have the right to opt out [of CCA] if they want to.
Yes. Customers, I believe, in all the programs can always chose to opt out, and there is not a deadline for that. They might have to pay a small fee if they don’t do it within two months or something…Most of the time the fee is very small, like $5.
Q: That’s what happened in other programs?
Yes.
Q: What are the consumer costs associated with leaving a legacy power system?
The costs are called “exit fees” and the idea behind it is that utilities have already entered into long-term contracts, sometimes up to 20 years to buy power, so if all of sudden a big portion of their customers…leave for a CCA program, the state doesn’t want those remaining customers to have to pay for the departed customers. The utilities can make the CCA customers continue to pay [fees toward utilities]… There was a decision made by the state regulator back in October, this past fall, to increase the amount of those fees for CCA’s customers. We are just kind of waiting to see how the feasibility study comes out and how Irvine’s rate could compare to SoCal Edison.
Q: So if I want to be a Community Choice customer, I have to pay exit fees to SoCal Edison to be part of the CCA, is that right?
If Irvine sets up a CCA, everyone is automatically updated into it and those fees are built into your rates. You wouldn’t have to do anything but yes, you would be paying these fees.
Q: Would I pay more than I do currently?
Generally, no. So far, every Community Choice program has been able to still offer a lower rate even with those fees included in them. So the hope for Irvine is that…they would still be able to offer residents and businesses a lower rate even with these added fees included in them. That’s what we are waiting to find out in the feasibility study.
Q: What are the biggest challenges to set up a CCA in Orange County?
So far, I think it’s just been cities grappling with other issues that take priority. A lot of cities are really trying to address the homeless problem and they don’t have the staff to dedicate looking into a feasibility study or even partnering with other cities on a feasibility study. I would say that’s the biggest challenge. The other challenge is that there’s not enough public demand for it. We’re trying to change it. It’s always taken grassroots movements to bring in a Community Choice Energy program. That’s how we’ve gotten the study in Irvine, by community members asking for it.
Q: Are there any other cities interested in the study launched by Irvine?
The study is just for Irvine, but they have invited other cities to piggyback on their solicitation process, so they don’t have to go through the steps of releasing a request for proposal (RFP), soliciting and reviewing all the bids. There are other cities interested. San Clemente is talking with the North San Diego cities right now. Oceanside, Carlsbad, Del Mar and Encinitas all partnered on a study that’s finishing up this month, if it’s not already finished. San Clemente would eventually join up with their Community Choice program if it launches. There are other cities like Lake Forest that are looking for partners. Tustin wants to do a study, but they have put that on the back burner for now; Costa Mesa might pursue one too. But for all these cities it’s getting them to make it a priority over other issues that are taking time.
Q: You said that the idea of the study in Irvine came from the grassroots. Who were the people involved?
There were a few groups that really kind of kicked off the process….The organization that I work for, Climate Action Campaign, gave a couple presentations about it about two years ago. That helped educate some community members and inspire them to go to city council meetings and ask for it. But there’s other people like scientists who have also been involved organizing people and meeting with city council members. There’s a group called Imagine Action OC that has been a big supporter to move forward with the Community Choice study. University High School’s Eco Club also came out in support of at a city council meeting. Major employers in Irvine sent letters of support such as Hoag and Edwards Lifesciences Corp. which has 5,000 employees and Irvine, so there’s been some business support also.
Q: What’s the role of your organization in this process?
Climate Action Campaign is providing the leadership for OC Clean Power. It is based in San Diego and was founded four years ago. We have meetings once a month to just check in with people from other cities that want to advocate for this program in their city. I am the advocate of the Climate Action Campaign in Orange County. My role is to do outreach in Irvine and to educate the city council members, city staff and community members about community choice program and to guide them about policy. I am trying to be a source of reliable information.
Q: Who is involved in that organization? Are they activists or green energy entrepreneurs?
Well, our founder, Nicole Capretz, worked for the city of San Diego for 20 years, and she’s an environmental lawyer… I wouldn’t say the other employees are green energy entrepreneurs. They are more passionate about climate, justice, social equity. We are kind from all over the place. We have one former navy veteran who sees climate change as a national security issue. I’m a former engineer and I am doing this because I had a realization, back in 2015, that I have two children aged seven and nine and that everything I was doing as a mom was going to be for nothing if we really didn’t address this crisis and do more to reduce our greenhouse gas emissions quickly. So, I started volunteering for local organizations and educating myself about what could we ask our cities to do. I started trying to figure what’s practical but doable with has a big impact. And that’s how I learned about choice energy. It’s really the biggest tool a city has to cut greenhouse gas emissions.
MZ Charlet is a free-lance journalist.