Community Choice Aggregation Update

The California Public Utilities Commission (CPUC) is actively working to implement AB 117, Community Choice Aggregation (CCA). The CPUC has scheduled workshop, comments, testimony and hearing dates on the issues to be resolved to allow cities, counties, or combinations of them, to aggregate the electric load of their residents, businesses and institutions. See the current CPUC schedule for this Rulemaking (R.03-10-003) at the end of this article.

One of the first things Administrative Law Judge (ALJ) Kim Malcolm did was issue a ruling to split the Community Choice Aggregation proceeding into two parts. The first will deal with cost and information issues, the second with the rest of the proceeding.

Phase I will address the following issues:

1. The cost responsibility surcharge — cost elements that should be included in this surcharge in fulfillment of AB 117; allocation of responsibility for the costs and whether they are non-bypassable;
2. CRS exemption for baseline residential customers — whether the utilities should pass along these subsidies to CCA customers and, if so, how to accomplish that;
3. Utility transition and transaction costs — keeping utilities and their customers indifferent to the costs of implementing the CCA portions of AB 117;
4. Meter, billing and distribution costs;
5. Utility customer information — information CCAs and prospective CCAs need to determine viability of CCA service and promote good customer service and reliability costs.

Phase II in this proceeding will address the following issues:

1. Customer notices required of utilities and CCAs;
2. Customer protections and switching protocols;
3. Operational protocols and load balancing;
4. Billing, metering and distribution services;
5. Reentry fees and switching fees;
6. CARE — discounts to low-income customers;
7. Other unresolved issues.

The CPUC will hopefully resolve these cost issues in a manner that the remaining bundled customers (those who stay with their current utilities and are not customers of a CCA) remain indifferent to CCA formation (that is they will not have to pay higher rates) and the costs are not so high that communities interested in CCA formation will abandon their efforts. LGC has created a discusion board on our website for local governments and others to keep up on these proceedings.

Two other CPUC rulemakings will impact CCAs. R.01-08-028 is the rulemaking that currently is working through the process for deciding how future energy efficiency public good charge funds will be administered and spent. One part of AB 117 allows CCAs to compete for a portion of these funds to develop and implement their own energy efficiency programs rather than relying on statewide and third party programs. Decisions about program administration, performance incentives, energy savings goals are upcoming.

The other rulemaking, R.01-10-024, deals with investor owned utilities' (IOUs) future electricity procurement. Its relevance to CCAs relates to the cost responsibility surcharge (CRS) that CCA customers will pay to leave their current utility. The more contracts for electricity the IOUs commit to now to provide power to potential CCA customers, the more costs will need to be covered to leave the bundled customers indifferent.

Anyone interested in receiving the notices and filings for these rulemakings can join the email service lists for them by contacting the Process Office at (415) 703-2021 or process_office@cpuc.ca.gov. You will need to reference the proceeding number for the service list you wish to join.

Below is the schedule for the Community Choice Aggregation rulemaking (R.03-10-003):

1/30/04
Utility reports to Commission on informational requirements of CCAs and prospective CCAs

2/13/04
Comments on Utility reports regarding information requirements

3/1/04
Utility distribution of service proposals and exemplary tariffs corresponding to Rules 22 or Rule 25

3/2/04
Workshop on CRS costing issues

3/12/04
Workshop on implementation and transaction cost issues

4/15/04
Opening testimony on CRS and other Cost Issues

4/30/04
Reply testimony on CRS and other Cost Issues

5/10/04
Rebuttal Testimony on CRS and other cost issues

5/24-27/04
Evidentiary hearings on costing issues

6/1/ 04
Opening briefs for costing issues and impacts of AB 1x baseline rate cap on CCA program

6/30/2004
Reply briefs for costing issues (submittal of Phase 1)

August 04
ALJ draft decision in Phase 1

September 04
Final Commission order in Phase 1

October 04
Pre-hearing Conference on Phase 2 issues

The schedule for Phase 2 will be determined after the second pre-hearing conference and following issuance of a Phase 1 decision.

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