Santa Monica calls out state board’s ‘stealth attempt’ to delay renewable energy choices

By Bonnie Eslinger

Santa Monica has been building momentum on a plan to shift the city’s electricity use to renewable energy sources — an effort that picked up speed last month when City Council members voted to plug into Los Angeles County’s new, government-run alternative energy utility.

Called Community Choice Aggregation (CCA), the framework allows consumers to switch from electricity generated by private utilities for renewable energy delivered over the same transmission lines.

But just days after Santa Monica signed on to CCA, the California Public Utilities Commission began pumping the brakes, proposing new rules to slow the rapid defection of electric consumers statewide from investor-owned utilities to public power programs.

Santa Monica cried foul, with Councilman Kevin McKeown blasting the CPUC for releasing its draft resolution for public comment over the holidays. In a written statement days before Christmas, McKeown said the agency’s move appeared to be a “stealth attempt by investor-owned utilities” to hold up the public power movement.

“Santa Monica will oppose this, fighting for cleaner and cheaper electricity for our residents and businesses by all means possible. We call on our state legislators in Sacramento to join us in demanding the CPUC pull this regressive item off its January agenda,” said McKeown, who is also the board director for the county program, called Los Angeles Community Choice Energy.

This pushback has at least bought some time, with a CPUC spokesperson confirming late Monday that a Jan. 11 vote on the rules has been postponed until February. Nonetheless, Santa Monica and the county are still facing the possibility that their CCA program could be stalled if the CPUC rules are adopted, which would impose a new process and a fixed timeline for the agency’s review of CCA implementation plans. Santa Monica, which expected to roll out its program in June 2018, along with other LACCE cities, said the change would push out that start for another year or more.

According to the CPUC, the new registration process and timelines are needed because the launch and operation of a CCA program will affect both electricity users and the utilities, particularly with respect to the impact the customer shifts will have on the companies’ already-set annual energy procurement plans.

CPUC spokesman Christopher Chow told The Argonaut the rules will ensure that the utilities, CCAs and other energy service providers have sufficient energy supply to meet customer demand.

“This helps prevent over-procurement or under-procurement and cost-shifting,” Chow wrote in an email.

Garrett Wong, an analyst in Santa Monica’s Office of Sustainability and the Environment, said blindsiding local governments with the new rules and discouraging public input with a “rushed” approval process worked against the growth of renewable energy service delivery.

“The solution is not appropriate. It’s a bit of an overreaction,” Wong said during a phone interview. “And the process by which they’re doing it is also one we’re not comfortable with.”

In the background information provided with the CPUC’s proposed resolution, E-4907, the agency notes that the law authorizing the creation of CCAs includes a directive to establish a process for their implementation. Although state legislators passed the law in 2002, the first CCA was formed in 2010, in Marin County, and only one other between then and 2015, the agency said. But the number of municipalities moving to public power has ramped up in recent years, with 12 communities since 2016 launching a CCA or submitting a plan to the commission to do so, making the timing right to put more structure in place as to when they can get started, according to the CPUC.

Under the new rules, a new or expanding CCA must submit its implementation plan no later than Jan. 1 of the year before it intends to start serving new customers.

Wong said concerns about procurement and the impacts of customer shifts could be addressed with short-term contracts in which the CCAs would essentially offtake capacity from the utilities during the transition period and pay them for it.

“That would be a more elegant solution than just saying, ‘Well, now you just have to all enroll in chunks, regardless of whether the market terms are favorable or your climate goals,” Wong said. “Jan. 1, that’s all you get.”

Joining LACCE would allow Santa Monica to offer up to 100% renewable energy to customers as an alternative to Southern California Edison. Renewables account for 30% of Edison’s overall power portfolio, but the company offers 50% and 100% renewable energy plans for homes and businesses.

In addition to Santa Monica, the cities of Alhambra, Calabasas, Downey, Rolling Hills Estates, South Pasadena and West Hollywood have also signed onto the LACCE program, which is expected to be available to residents of unincorporated areas starting this year, according to L.A. County officials.

While the CCA will utilize solar, wind and other green sources for its energy supply, the delivery, metering and billing for that power will still be carried out by Edison.

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Editor’s Note: Information about Southern California Edison’s renewable power portfolio and offerings has been corrected from an earlier draft.

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