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Environment Report: The Future of CCAs Is Being Hashed Out in a Flood of Private Meetings

The governor has signed another big clean energy law, concerns over heat deaths aren’t going anywhere and more in our biweekly roundup of the region’s environmental news.

Community choice aggregation supporters rally in downtown San Diego. / Photo by Adriana Heldiz

Over the last month, regulators from the California Public Utilities Commission have had a deluge of private meetings with utility company officials and officials representing government-run power agencies known as community choice aggregators, or CCAs.

These “ex parte” meetings are legal but have been the subject of controversy. A widely panned deal to leave ratepayers on the hook for problems with the nuclear power plant at San Onofre was hashed out, in part, during an undisclosed ex parte meeting in Poland.

Typically, the meetings are not so much like something out of a James Bond movie. Instead, according to regulatory filings that disclose some of what happened, they are meetings between people with business before the commission and aides to the five CPUC commissioners.

The meetings generally last about a half hour, in person or by phone. The parties lobbying the CPUC staffers typically leave behind a short handout or PowerPoint presentation. Afterward, participants file a document that talks about what was discussed and a copy of any written material used during the meeting.

The current case is contentious because it could decide the fate of the CCA movement.

In early August, state utility regulators unveiled a draft plan for dealing with power companies’ stranded costs as an increasing number of Californians switch to buying power from CCAs.

Existing power companies – San Diego Gas & Electric, Southern California Edison and Pacific Gas & Electric – already built power plants or signed long-term contracts to buy power on the assumption that their existing monopolies would never end. Now, though, millions of California customers are leaving for CCAs. For years, companies have been able to charge departing customers an “exit fee” to recoup those stranded costs, but nobody has been able to agree on whether the fee is too high or too low. If it’s too high, few governments would be able to provide cheaper power, destroying the community choice movement. Too low, and customers stuck in places without any choices will be paying too much.

The number of private meetings in this exit fee proceeding is unprecedented, said Matthew Freedman, a staff attorney for The Utility Reform Network.

“The CCAs have been doing everything possible to engage in private conversations to persuade CPUC Commissioners and staff to adopt a methodology that minimizes the responsibility of CCA customers for stranded costs,” he said in an email. “I don’t recall any recent proceeding that generated this volume of ex parte contacts.”

Beth Vaughan, the head of a community choice trade group, said nothing unusual was afoot – the reason CCAs are appearing in these private meetings so frequently is simply because there are a lot of them.

“There are now 19 operational CCAs in California, with 10 launched in 2018 alone, so it’s a big group,” she said in a statement. “The commission designated each operational CCA as a party to the [exit fee] proceeding and consequently they have an obligation to actively contribute and ex partes are one avenue. Under the rules, each party is allocated equal time.”

Ironically, one of the main reasons CCAs argue they are better than existing power companies is that they are locally governed, while the CPUC, which meets in San Francisco, has to clear most major power company decisions. In this instance, the CCAs remain at the mercy of the CPUC.

Power companies have also arranged meetings, too: For example, on Aug. 3, just two days after the proposed decision was released – and it became clear that things might not be going the power companies’ way – the state’s three major utilities had arranged meetings with four of the five commissioners.

Governor Signs Clean Energy Law

On Monday, Gov. Jerry Brown signed a law that forces utilities to get 60 percent of their power from renewable sources by 2030, up from a 50 percent target in current law.

The bill, backed by state Sen. Kevin De León, made it out of the Assembly in the final days of the legislative session, thanks to vote-whipping by Assemblywoman Lorena Gonzalez.

The bill, known as SB 100, also sets a goal for utilities to get 100 percent of their power from renewable sources by 2045, though that part isn’t binding.

While Brown has forcefully backed some plans to fight climate change, it wasn’t always clear he would sign this bill.

After he did, Michael Brune, head of the Sierra Club, said, “California has long been a leader. Now, its commitment to 100 percent clean energy will serve to inspire even more leadership throughout the country and around the globe in the transition away from fossil fuels.”

Heat Deaths

One issue that will not go away in coming years: people dying from extreme heat.

Last year, 172 people died from heat in and around Phoenix in Arizona’s Maricopa County. Urban Arizona, in particular, has struggled with heat deaths, something the Arizona Republic has spent time investigating. Such deaths are more likely in poorer neighborhoods, in part because those areas also don’t have cool tree-lined streets, which are more common in richer areas.

California, of course, has similar problems – just look around the neighborhoods with trees and those without to spot the inequality.

Perhaps the most notable recent wave of heat-related deaths here occurred in 2006, when over 100 and perhaps as many as 450 people died because of heat.

It’s an issue to keep an eye on, particularly in the context of energy prices. Many homes in coastal California lack air conditioning, but a recent heat wave came with humidity and was unrelenting at night.

During a recent speech to the Assembly, Gonzalez talked about this new problem for San Diegans.

“It wasn’t even imagined that if you live in coastal San Diego you’d need air conditioning, but now you can’t live without it,” she said.

In Other News

  • The Metropolitan Water District of Southern California won’t release to the public the formula it uses to calculate rates paid by us all. The San Diego County Water Authority is suing to make that formula public, but so far lower courts have sided with Metropolitan. (Union-Tribune)
  • A pair of environmental groups is suing Metropolitan over its plans to pay for a pair of underground tunnels to bring water south from Northern California. (Food & Water Watch)
  • In other end-of-legislative-session environmental matters: A plan to “regionalize” the electric grid failed, a plan to spare utilities some wildfire-related liabilities passed and a plan to make it harder for a company to bring water into Southern California from the Mojave Desert died. (Greentech Media, Desert Sun)
  • Even if the County Board of Supervisors approves a major new housing development near San Marcos, construction could be delayed because of a ballot measure that would seek to kill the project, known as Newland Sierra.

Disclosure:  Mitch Mitchell, SDG&E’s vice president for government affairs, sits on Voice of San Diego’s board of directors.

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