California’s Community Choice Aggregators Rising to the Occasion

Recently, in the middle of a record-breaking heatwave, hundreds of thousands of California consumers lost power for the first time in nearly two decades. The situation has, unfortunately, created unwarranted scrutiny of renewables and the state’s overall energy transition. 

But California's Independent System Operator, a nonprofit agency that manages the state's power supply, says that capacity shortfalls are the issue this time, as well as California's reliance on importing resources. So, this is clearly a management and planning problem; regulators admit that they need to do better with forecasting demand and production from all energy resources.

However, newer models of power delivery are proving to be an asset in dealing with such problems. Community Choice Aggregators (CCA) are public, nonprofit agencies created to offer local communities cleaner and more affordable options for consumer-facing energy generation. 

There are currently 21 CCAs in the state, serving more than 10 million ratepayers. Local governments run CCAs. Due to these agencies' flexibility, they are well-positioned to help communities increase their energy resilience to curb the likelihood of massive blackouts.

Every CCA is a reflection of the local community that forms the agency. Because CCAs work so closely with their consumers, they have a ground-level view of the difficulties their consumer deal with, and CCAs can use a mix of power generation to address those difficulties, including using solar and battery capabilities to boost energy resiliency in areas where homes are at risk for power shut-offs. 

MCE, California’s first CCA, has worked closely with the communities they serve to address these issues from the ground floor. MCE’s elected board consists of mayors, council members, and county supervisors, representing their communities’ energy needs. 

"Our elected officials tend to be very well-informed about what the local needs are and what the local resources are, so we can really combine efforts where feasible," said MCE CEO Dawn Weisz.

At the end of July, three California CCAs announced a new agreement with solar and battery company Sunrun to create an energy resiliency program. East Bay Community Energy (EBCE), Peninsula Clean Energy, and Silicon Valley Clean Energy (SVCE) are the CCAs who partnered with Sunrun. 

The “emissions-free resiliency agreements” will see the creation of up to 20 megawatts (MW) of emission-free solar and battery backup power that will help 6,000 households that are vulnerable to the power shut-offs occurring during peak wildfire season.

“The wildfires that disrupted our power and lives last fall have given us an opportunity to find ways to better protect our most vulnerable customers from losing essential supplies and comfort during emergency outages,” said Peninsula Clean Energy CEO Jan Pepper. “This innovative approach and partnership also establish a new model for a cleaner and more reliable electricity grid for all our residents.”

The partnership is focused on increasing power generation from renewables. The new power-generation capabilities aim to reduce the overall peak demand and improve the reliability of the grid. The increased capacity is expected to come online incrementally starting this year, with the completion date scheduled for 2022.

“In addition to providing needed resiliency to the members of our community most impacted by power shut-offs, this program is instrumental in shifting away from a centralized, fossil fuel-based grid to one that is distributed, decentralized and decarbonized,” SVCE CEO Girish Balachandran said. “Historically, reliability is provided by centralized gas plants. We are at a pivotal moment where it has tipped toward battery storage systems and local resources.”

Dealing with the multiple environmental challenges California must overcome requires carefully integrating and managing renewables, and that requires a power supplier who knows their community and is accountable to them. As CCAs gain more traction in the state and begin serving more customers, California’s energy landscape will start to shift with the people, allowing CCAs to rise to the occasion by providing clean, reliable power.

PG&E Monopoly is not Good for Customers or Forests

Last week was not a good week to live in California, especially for the astonishing 800,000 people who lost power. For the unlucky ones who had less than 24 hours’ notice, it was an exceptionally bad week. A blackout would be bad enough, but it was especially egregious given that the power outages were deliberately caused by the state’s biggest monopoly utility, Pacific Gas & Electric (PG&E), in an attempt to reduce the risk of its infrastructure sparking another wildfire.

Unsurprisingly, the sudden blackouts did not go down well with consumers. Without sufficient notice – PG&E even knocked out its own website making communicating with its customers all the more difficult – traffic lights went out; hospitals, police stations, and fire stations weren’t prepared; and up to $200 million dollars’ worth of food rotted. All because of bad planning and a misuse of funds. Just this morning, the CEO of PG&E said that the blackouts will have to occur for the next ten years.

The California fire season is getting worse every year, in part because of rising temperatures and shrinking rainfall, but also due to California’s refusal to actively manage its forests by thinning tree growth, ground brush and other fuels. Fires aren’t being fought the way they should be, and because of California’s housing crisis and high property values, more people are moving into fire-prone land.  

Fire is a natural part of the lifecycle of a healthy forest. As a forest matures, fuel sources build up on the forest floor and tree growth becomes denser making it more prone to fire caused by lightning or other causes. Naturally occurring wildfires regularly reduce the amount of fuel and keep it from building up. But in California and many other places, small wildfires have not been allowed to occur, nor has the local government gone in and cut trees and cleared brush. This has left our forests in an unnatural state and vulnerable to major fires because of the amount of available fuel.

PG&E knew this, and yet for years dragged its feet on updating aging infrastructure, preferring instead to line their investors’ pockets,  donate to political campaigns friendly to them, and cozy up with regulators. Rates went up for customers, ostensibly to update infrastructure, but very little was actually done. It was an outdated PG&E tower that caused last year’s deadly Camp Fire, prompting a class-action lawsuit that has pushed the monopoly utility into bankruptcy court.  

That wasn’t the first lawsuit either: the company was fined $3 million in 2010 for covering up a pipeline explosion,  and this year the courts said PG&E violated its probation. If PG&E were a politician instead of a government-created monopoly, the attack ads would write themselves.

A California bankruptcy judge has decided that PG&E – the state’s largest utility with 40 percent of ratepayers – cannot be trusted to write its own restructuring plan. What’s next for California electricity customers remains an open question. Will PG&E emerge from Chapter 11 bankruptcy as a vertically integrated utility?

One thing is for sure, more and more customers are saying they want greater local control over where they get their power. Municipal-run Community Choice Aggregation (CCAs) are popping up all over PG&E territory. We think California should go further by increasing competition in the retail sector.

California allows limited electricity choice for residential customers, but it should do more to increase direct access to competitively priced electricity for consumers. Competition will bring efficiency and innovation to the electricity market. Letting the private sector compete to generate electricity and provide ancillary services will free up incumbent utilities to focus on improving the distribution infrastructure. California’s crumbling power lines aren’t going to fix themselves.