Jim Parks, director of customer care and marketing at Valley Clean Energy offers his insight into community choice aggregators. For more from Parks, check out “Power Politics” in our November issue. Sign up for our newsletter and we’ll email you when it’s available online.
What’s the biggest change for community choice aggregators in the past year?
The biggest change is the sheer number of new community choice aggregator participants. Of the 19 active CCAs in California [according to CalCCA], at least 14 started service in 2017 or 2018. In addition, several local governments are looking at the possibility of either joining an existing CCA or starting a new one. The CCA market is booming with new entries.
What do you foresee as the biggest challenge on the horizon in the year to come?
The biggest challenge for CCAs is regulatory uncertainty. In a disappointing decision, the California Public Utilities Commission voted to increase the exit fees charged to CCAs by investor-owned utilities. The exit fee is called the Power Charge Indifference Adjustment and is designed to compensate the IOUs for electricity generation built or contracted in the past. When the PCIA goes up, CCAs must reduce their generation rates in order to maintain rates that are competitive with PG&E. The CCAs understand and support the need for a fair exit fee, but believe the current CPUC decision favors IOUs at the expense of CCAs.
In the coming year, there will be a number of regulatory or legislative decisions that will impact CCAs and it is not always clear whether the decisions will have a positive or negative impact. Having said that, CCAs are growing, and are a resilient group with hard-working, experienced staff. CCAs are up to the challenges and will continue to grow and provide benefits to the communities they serve.
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