Just as Uber and Airbnb have given people choices in transportation and lodging, community choice aggregation programs give people choices in their electricity supply. A CCA means the government, rather than a company, will be in charge of buying power.

But community choice aggregation programs offer much more than just choice. As its name implies, CCA is community-oriented. All aspects of the program’s operation are determined by the community, and its primary goal is to benefit that community.

Arguments about these government energy programs are often dominated by price, because it is one simple number. But just as there are many factors to consider besides price when paying for transportation or lodging, there are many benefits of a community choice aggregation program besides price that are important.

A CCA makes decisions in open, public meetings, and residents are welcome to contribute to the decision-making process. Typical issues that come up at these meetings include the energy options the CCA should provide, setting rates and choosing incentive programs. Rarely will utility companies provide this information, even to shareholders.

A CCA board is elected by the public, and so the decisions made must reflect public sentiment. For example, California CCA programs in other parts of the state all offer multiple options for clean power. Although these programs are often criticized as “government-controlled,” they actually give residents much more influence over decisions than a corporation does.

A utility may change its rates several times a year without warning, but a government-run power program can only change its rates once per year. CCA rates are changed in public meetings, so not only are there are no surprise changes, but residents have a voice in the changes.

We Stand Up for You. Will You Stand Up for Us?

As in any business, price settings are subject to many pressures. A CCA, though, has an advantage in that it is a nonprofit and has no shareholders to pay.

Like any business, a CCA must be financially prudent and set its rates to build a comfortable operating reserve. Once this reserve is built, disposition of extra CCA revenue is ultimately a community decision. For example, some existing CCAs have offered rebates for electric vehicles, while others have discounted home-efficiency improvements. While utilities are beholden to their stockholders, a government-run energy program is beholden to its residents.

CCA revenues stay within the community – they are not distributed to shareholders.

Since it’s an advantage to have elected officials backing your business, utilities are not reticent about contributing both directly and indirectly to politicians. This is not an issue with a CCA, since it’s a government program.

Utilities have a sweetheart deal: For any investment in infrastructure, they are guaranteed a handsome return of 10.5 percent a year. So of course they like to build big projects like power plants or gas pipelines – whether we need them or not. Ratepayers are stuck footing those bills. A CCA, meanwhile, will have little infrastructure.

CCA finances are completely isolated from city finances, which means that its expenses do not compete with fixing that pothole on your street.

While a CCA program provides many community benefits, the path to building one is far from easy. Perhaps the biggest impediment is opposition from vested interests.

Just as the taxi and hotel lobbies oppose competition from Uber and Airbnb, utilities oppose competition from CCAs. After all, when you are a monopoly, the appearance of even a single competitor is a big disruption.

So utilities have a well-worn playbook on how to fight attempts to form alternative energy suppliers.

The one thing San Diegans will hear during the utility company’s campaign against CCAs is that it’s too risky and costly. Then there is the commissioning of “independent” reports.

As cities in Sempra’s territory get closer to making firm CCA decisions, expect considerable escalation of efforts on both sides. Be critical. Be skeptical. Don’t let the well-heeled utility company’s campaign dissuade you from learning more about the benefits of CCA programs yourself.

Jim Wang is an environmental commissioner with the city of Encinitas, and serves on that city’s CCA subcommittee.

    This article relates to: Climate Change, Environmental Regulation, Opinion

    Written by Opinion

    Op-eds and Letters to the Editor on the issues that matter in San Diego. Have something to say? Submit a commentary.

    craig Nelson
    craig Nelson

    Mr. Wang , I am skeptical and critical - what makes you think a city that can't fill its potholes or produce enough housing is sophisticated enough to run an energy monopoly?  Why are you forcing this on the ratepayers instead of allowing those who believe in this nonsense to simply opt in ?  (we both know the reason is there are not enough people who would willingly join so you must do it to them at gunpoint). 

    When this backfires and the city loses millions facing bankruptcy I will open the bidding to re-name Encinitas...I'm leaning toward Enron-by-the-sea.

    Sean M
    Sean M subscriber

    Note how the author deceptively refers to price,not to cost. Renewable advocates never want to talk about cost. It cost $billions to build the grid that works just fine today and it will cost billions to replace it with intermittent and unreliable power sources. Folks hate their electric bill increases in Germany and in Australia and they will hit harder in SD.

    I think the true motivation behind CCA is the pricing power it gives to the government: they can raise your rates to pay for the discount they give to your neighbor for buying a Tesla.

    The one part of the piece I agree with is to be skeptical. Most of the utility scale renewble energy will not be built in CA, it will be built elsewhere. Sending CA ratepayers dollars to Montana to build wind farms subsidizes coal use in that state, which, gets 63% of their electric power from coal. Renewable advocates use accounting tricks to claim x% of electricity is from renewable sources but that is a lie, there is no way to segregate the electrons from coal from the electrons from wind, solar, etc.

    Joe O'Keefe
    Joe O'Keefe subscriber

    I have just one simple question: What government run enterprise has ever proven to save money? I don't know any that are run more efficiently than a for profit business. Let's look at a few factors:

    1. Is it cheaper to purchase power for 6+ Million customers or 50-100 thousand?

    2. Would you like to have another layer of government interacting in your daily life?

    3. Are you willing to pay more for your energy because your neighbors want to use solar vs cheaper produced electricity?

    All of the infrastructure that is needed to deliver energy to your home is owned by SDG&E. If you remove this profit center from their bottom line then they will simply charge you more to use their grid to deliver the power to you. You will continue to be charged for the use and maintenance of the grid no matter who you purchase energy from. Lastly, you will need to employ people whose job will be to purchase the power you use. These people will not be cheap. So think about the salaries and pension costs for these folks. Does having a CCA look so beneficial now?

    Chris Brewster
    Chris Brewster subscribermember

    Mr. O'Keefe: One option here is a utility regulated by a state commission (SDG&E). The other is a local nonprofit regulated by locally elected officials. They would both, essentially, be utilities regulated by government. Under the current system we have one and only one choice. Under the proposed system we would have two choices (i.e. competition). Do you prefer having no choice of energy providers?

    craig Nelson
    craig Nelson

    @Chris Brewster Except it is , of course, not a choice at all. The CCA will FORCE taxpayers (most unwillingly I might add) into their own little monopoly. They will tell you that you can opt out - but of course its the government so you can't opt out- I tried and they replied we dont know how to do that yet. I also asked how much the fee will be to opt out ( there is a fee in the Marin CCA ) of course they don't know that either. 

    Chris Brewster
    Chris Brewster subscribermember

    Mr. Nelson: You state above, "I tried." How can you try to opt out of a system that doesn't yet exist? As for the fee, what if it is $0? 

    Bill Stoops
    Bill Stoops

    If a CCA is such a good deal, why are existing utility customers initially forced to become CCA customers should the local government entity establish a CCA?  Sure, you can opt out after being forced to initially opt in, but why the use of force in the first place?  If the CCA is such a good deal, customers will flock to it, as people do for good deals.  Any enterprise that requires the use of force to create a customer base is wrong.

    Chris Brewster
    Chris Brewster subscribermember

    Mr. Stoops: With respect to your suggestion that, "Any enterprise that requires the use of force to create a customer base is wrong," I would provide to you as exhibit A SDG&E. It's entire customer base is forced to use it. I presume that the reason behind the opt-out model for a CCA is to create an adequate customer base from the start to make the system feasible, but clearly the system would give everyone a choice of going with the CCA or SDG&E. Thus San Diegans would all have a choice going forward that don't have now: between two energy providers. Would you prefer to be locked into one choice (SDG&E) in perpetuity? My experience and observation, having represented homeowners on an SDG&E sponsored working group related to home solar is that the utility is opaque, domineering, manipulative, and driven primarily by a profit motive, rather than the best interests of its customers. There's nothing wrong with a profit motive except, as you allude, when the profiting entity is a monopoly over which the customers have no real control. I'd prefer to have the ultimate choice to go with the CCA or SDG&E. In that scenario, both would have to compete for my business. There is no competition now.