Three times in the past 30 years, local governments in San Diego have tried to unseat San Diego Gas & Electric as the region’s power monopoly. Three times, SDG&E has outmaneuvered local politicians with a combination of political spending, lobbying and savvy negotiating.
Now, SDG&E faces another round of competition from local governments across the county. The city of San Diego is looking to buy power for its 1.4 million residents from someone else. A handful of other San Diego County cities, including Solana Beach and Carlsbad, are looking to do the same.
The cities suspect they can provide greener energy at a lower cost than a for-profit company like SDG&E.
The question is whether tactics SDG&E used to preserve its monopoly in the past can work again today.
“Can we unlock the monopolistic grip, like we did with AT&T?” said Lane Sharman, founder of a nonprofit that advocates for communities to have energy choices.
If history is any indicator, the answer is no.
We Stand Up for You. Will You Stand Up for Us?
no doubt sdge will increase the "delivery" ( or make up more bogus fees) to compensate and keep their income level the same for those that go with the plan.
There is a finite amount of renewable energy. The state law requires that it be used. So a CCA getting Customer A more renewables means customer B will get fewer. Rearranging deck chairs on the Titanic ? Oh yes, creating a new highly efficient government (read politician) run bureaucracy is always good.
Community Choice Energy gives us local control, competition, and cleaner energy. That leads to more local jobs, less pollution, and competitive pricing. There is a lot to like about CCE!
What's not to like about competition? Choice encourages innovation and lower costs. Under Community Choice Energy, if customers wish to stick with SDG&E, they can do it. But if they are looking for a faster transition to 100% clean energy, they can opt for the low risk cost savings of CCE. What's not to like? And thanks for your article.
I want the freedom of Community Choice Energy, CCE, also what is called in the article, CCA. The CCE will be a local company, not a monopoly like SDGE, and will be renewable energy. The bills have historically been the same or less than the bills from SDGE. Also, with it being local, they will be much more responsive (try getting SDGE to respond quickly to a problem other than an absolute crisis!) and they will be hiring local people. SDGE has locals, sure, but also plenty who live elsewhere. All of the people in a CCE would likely live right here in San Diego City, or nearby. The CCE would be more energy efficient, good for the local economy, and responsive to people as well as the same price and likely cheaper. Lets get Community Choice Energy!
There are three C's to a community choice program: Competition, Clean, and Control. The program brings competition to the production and procurement of our electricity, a function that is now a monopoly. Would the Post Office have Express Mail if FedEx hadn't come along? Would long distance calls be free if Ma Bell hadn't been broken up? What would Apple charge for the iPhone if they were the only game in town? Can you name one sector of the economy that would serve us better as a monopoly (other than the natural ones)? Walmart the world's only retailer, anyone? Amazon?
So, just in terms of competition alone, CCA is a major step forward. Next: Clean. The city, in response to the climate crisis, put together a Climate Action Plan, as mentioned in the article. The city is working in our interest and will use the CCA vehicle to drive toward 100% renewable energy by 2035. Is it a slam dunk? Was going to the moon? We take it one step at a time. The point is, SDG&E is, by it's nature, neutral on power generation source, not beholden to the city or it citizens, only to the CPUC.
And that brings us to the last C - Control: if we don't have CCA, then we hand over control of our destiny to the CPUC and our only strategy is hope. Which is not a strategy.
Bottom line: a CCA program will work toward our benefit by introducing competition, striving toward a low-carbon future, and putting us in the driver's seat, not the back seat. SDG&E officials are doing exactly what they should, which is to look out for the company's best interests. They don't need our help doing that.
First principles: 1. Monopolies don't respond to customer needs, nor non-bottom line imperatives, like the committment we've made to be 100% renewable. 2. The only progress made by power monopolies like SDG&E is when they've had the prospect of competition in front of them. 3. Community Choice merely means the city gets to select it's power sources to meet its committment to eliminate carbon based fuel for electricity. It's working well elsewhere, with lower costs and better mix of renewables, and fosters the growth of more sources. Yes, SDG&E would still maintain and charge for the physical infrastucture of delivery. 5. Community Choice sourcing would increase local job growth in clean energy, increase local sourcing, and provide competition in an otherwise unresponsive monopolistic system. What's wrong with it? SDG&E dosn't like it...
Great article! I love what Community Choice has done to reduce rates and improve the environment for other parts of California. It's high time we get Choice in Southern CA. I've taken a deep look at my electric bill and it's not good. Two-thirds of my bill is just for "transmission" and "distribution". Electricity usage has gone down, while the number of gas power plants has gone up, and still SDG&E threatens we will have blackouts and brownouts. We have some of the highest rates, and we're not even getting reliable power. Like most of California, we can do better. Thanks for this article.
I find the repeated use of the term "competition"incorrect, and in truth, offensive. Sempra/SDG&E is a private capital funded company, who operates as a government authorized service area monopoly. I have no use for ANY government created monopoly. However, to somehow call a government created CCA competition for a privately funded company, is obscene. Government created CCA's have legislation in place, AB117, that requires SDG&E customers to initially buy from the CCA, should it be established through government action. Once being g forced to join, a customer can then opt out, at some procedural process, and perhaps cost, that I do not yet know about. The CCA will have regulatory authority different from a privately funded company, different auditing standards no doubt, and of course the ever deep pockets of taxpayers should the CCA make errors in contracting or operations. SDG&E has stockholders and bondholders to absorb performance issues. Not so with a a CCA, the taxpayer will be the funding mechanism. And of course the force used to create a customer base should a CCA become established is curious. If a CCA is such a benefit to a customer, why the need for force? If a CCA is a good deal, customers will flock to it, no force needed. Proponents of CCA's know that without force, the establishing of a CCA is dead on arrival. The Solana Beach "technical study" purporting to analyze and determine that Solana Beach can make use of a a CCA so states on about page 65, or 68, somewhere in there. This "study", which is really a marketing plan is available to review on the city website.
California, Connecticut, Hawaii and New York already have among the worst unfunded pension liabilities. Their residential electricity prices are already outrageous: 17 cents a kilowatt-hour in NY, 19 in CA, 20 in CT and 29 in HI – versus 9 cents in North Dakota. Honoring “Paris commitments” would send rates skyrocketing to German and Danish levels: 37 cents per kWh. Expensive energy will hurt poor and minority families the most and send jobs to countries where energy costs less.
If you're against SDGE, then they try to kill you.
If you lobby for SDGE, then they buy you prostitutes.
Gettin' laid in Sacramento
@creekt creekti see how they keep you from operating off the grid
A truly horrible idea, replace a monopoly (SDGE) by adding a 2nd monopoly (CCA) with duplicative overhead, absurd executive pay etc. Rivard left out the part that explains SDGE will still be paid to do all the actual work...deliver the energy, send out and collect the bills etc. so the existing monopoly will remain in place - this just adds a second one. CCA also transfers the risk of bad energy contracts onto the little cities (Enron by the sea?) which sent the NoCal town of Hercules into bankruptcy. Don't we have enough monopolies, waste & bureaucrats already?
@craig Nelson Very good points. CCA is a poor choice of terms. Politician choice is likely the better name for this. I would love to see a move to a true market mechanism for choosing power suppliers. Politicians choosing is potentially worse than the SDG&E monopoly.
@craig Nelson Duplicate overhead is true - but then consider that Lowe's and Home Depot have duplicate overhead. FedEx and the US Post Office. General Motors and Ford. The question to ask is - what sector of the economy do you NOT want to see competitive? In Illinois, 80% of the utility customers are served by a CCA program. The largest CCE is in Ohio, and the oldest is in Massachusetts - it started in 1997. So this is a proven method of replacing a monopoly with competition.
Feelin' the pain of SDGE's latest rate hike. Just got my bill - used less power last month, but the bill went up $10 anyway. I have a pretty low "power footprint" so I'm guessing this increase is not about what I use, but what SDGE wants me to pay for.