I strongly believe that Community Choice is the wave of the future and that each city and county in the State is likely to adopt at some point. The primary purpose of the process we pursued was to provide a price reduction in your electric bill. Historically MCE rates have been lower than PG&E. However, with new information that we received late last week that the CURRENT MCE rates are higher than PG&E, I believe it makes it more difficult to take action at this point. At the Tuesday, February 23 Council meeting, I suggested to the Council that we take the next 6-9 months and see what other cities are doing, what adjustments to rates are made by PG&E and others and see if the State Legislature might change the law to not require the full “opt-in” that it does now – which frustrates us all. Then after the first of the year we can reanalyze and reevaluate with new and additional information. The Council supported my motion unanimously. No action was taken last night and Staff was directed to bring this back to us at a later date. Your PG&E bill has been left alone.
PG&E raising rates in March – http://www.contracostatimes.com/breaking-news/ci_29552487/pg-e-bills-headed-higher-march-and-2017
California State Assembly Bill 117 (AB 117) was passed and signed into law in 2002, to enable Community Choice Aggregation (CCA). Community Choice Aggregation allows cities and counties in California to pool (or aggregate) their electricity load in order to purchase and/or develop power on behalf of their residents, businesses, and municipal accounts.
Hundreds of CCAs exist nationwide in California, Illinois, Massachusetts, New Jersey, Ohio, and Rhode Island. CCAs serve approximately 5-percent of customers in America. In California, there are currently four CCA’s serving customers: MCE Clean Energy, Sonoma Clean Power Authority, Lancaster Community Choice, and CleanPowerSF.
Currently, electricity used in Oakley’s homes, business, and municipal buildings is provided by PG&E. Oakley residents do not presently have an alternative electricity provider beyond PG&E. The City is interested in offering Oakley residents and businesses another option when it comes to energy providers.
Within PG&E’s service territory there are two active CCAs. These include Marin Clean Energy (MCE) and Sonoma Clean Power (SCP). At this time, Sonoma is not accepting new members outside of their existing service area. MCE Clean Energy has expressed interest in expanding and is accepting letters of intent from jurisdictions outside of its current service area. Three Contra Costa cities have already joined MCE Clean Energy: Richmond, El Cerrito, and San Pablo. Lafayette, Walnut Creek and Oakley are in or near the membership process. Offering this option has no fiscal impact on the city. By going with MCE, residents of Oakley will have a choice of electricity; stay with PG&E or pick from MCE’s power options.
Under California law all residents within a CCA service area must be offered CCA service. Once again, under state law the CCA program operates on an “opt out” basis. Thus, customers who have been offered service by a CCA and who do not affirmatively decline such service (i.e., opt-out of the program) will be automatically enrolled in the program and will be served thereafter by the CCA.
PG&E will continue to deliver the electricity, maintain power lines, send bills and provide customer services. If you decide not to opt-out, a line on your PG&E bill will state that your electricity is coming from MCE. You will continue to pay PG&E delivery and gas charges. Customers using low-income/CARE programs will continue to receive the CARE rates if they join the MCE or stay with PG&E.
MCE will procure a different mix of energy resources than that offered by PG&E that include a range of renewable energy sources: solar, wind and waste-to-energy, providing 50 to 100 percent of their. Your power options provided through MCE include: “light green” with 56 percent renewable energy, “deep green” 100 percent renewable, or “Local Sol” with 100 percent local solar. All customers will initially be provided with the light green option.
MCE may charge different rates for electricity than PG&E, resulting in a change in charges on your overall electricity bill. Historically MCE has been able to buy electricity at lower prices or produce their own electricity and then resell it to their customers at lower rates than PG&E, which locked up its energy contracts years ago when prices were higher. If you decide to stay with MCE, PG&E is permitted to charge you an exit fee to compensate it for the power contracts it previously entered into to supply electricity. In December of last year the California Public Utilities Commission (CPUC) raised the exit fee from $6.70 to $13 a month. This exit fee will disappear over time, until that happens the cost of the fee will fluctuate, reflecting the difference between the market price of energy when PG&E signed its contracts compared with the price of energy today. This means that at some point you may pay more for MCE then you do with PG&E. Once again the choice is yours.
The second reading of the ordinance will happen at the February 23 City Council meeting. If approved, Oakley residents will see an aggressive informational campaign by MCE over the next several months to help residents make an informed energy choice later this year. This outreach may include: up to 4 possibly 5mailings to each household, MCE participation at local events and workshops, as well as presentations to clubs and organizations. At any time during this outreach process Oakley residents may elect to opt-out of the program. Once again the choice is yours.
Actual electricity service will probably start in late summer or fall 2016 and will be phased in. PG&E and MCE will work together to reach agreement on a mutually acceptable implementation plan and schedule. Again you can opt-out anytime during this phase, however; If a customer chooses to opt out after the first 60 days (two months) of service, s/he will have to pay a one-time administrative fee ($5 for residential customers; $25 for commercial customers) and would then be subject to PG&E’s terms and conditions. Presently, if customers chose to opt out of MCE after 60 days, PG&E will require a one year waiting period before customers can return to MCE.
In an industry dominated by one player – providing competition and choices is the necessary first step for change. This change will be accelerated when third parties are allowed to participate in rate determination. A well-structured competitive electricity market can help keep prices low for customers, even if they don’t shop for an alternative supplier.
Competitive electricity markets — rather than monopolies — are the best way to keep energy prices affordable, allow for customer choice and spur the kind of innovation that results in new products and services.