Tag Archives: Cca Program

California’s Distributed Energy Future

GTM Research has established itself as the premier source of information on solar industry trends and developments in the United States. It’s instructive that from that perspective, they chose to organize a conference focusing on a single state, California.

We who participate in the solar industry here have recognized the state as a leader, but the less patronizing among us also recognize that the magnitude of this lead is only temporary. If solar is to realize its potential as one means of reducing environmental damage while reducing future customer utility costs, then other parts of the United States need to catch up (and as GTM’s latest data for 2015 shows, they are).

Nonetheless, as GTM Research Senior Vice President Shayle Kann observed in his opening keynote at GTM’s California Distributed Energy Future conference in San Francisco, California remains the epicenter of next generation distributed energy (DE) regulation and is at the forefront of the shift toward distributed energy in the U.S. And (I would add) what happens in California doesn’t always stay in California. Hence the conference to examine California’s transition to a distributed energy future and consider what’s working and what isn’t.

The discussions at the conference covered a variety of issues confronting the state. Here is an overview of the key themes coming out of the discussions, and the insights shared by the different speakers:

The strongest and most frequently recurring theme was that of the interaction of Distributed Energy Resources (DERs, essentially distributed solar PV) and the electrical grid. This issue has numerous dimensions, and subsequent “fireside chats” helped highlight some of these.

Appropriately the first discussion was with a Senior Vice President from Pacific Gas & Electric (PG&E), California’s largest investor-owned utility (IOU) and the utility with more connected PV capacity than any other in the United States. Issues were fairly raised: e.g., how should rates be structured to fairly compensate the value of Grid access received by the customer, how does PG&E envision an environment of growing Community Choice Aggregation (CCA) systems and how is the Grid managed for reliability. Unfortunately, the moderator for this session let the PG&E representative off with the stock, PR answers: “we have to make changes in our rate structures”, “they can work, note how long Marin (Clean Energy, 2010) and Sonoma (Clean Power, 2014) have been in service”, and “we need to build in robustness.”

Ah well, at least subsequent chats returned to DER issues in more depth. DERs can lower costs for Grid operators / managers; experiments were cited by both Southern California Edison (SCE) and San Diego Gas & Electric (SDG&E) involving combinations of storage and DERs. Time of Use (TOU) pricing is coming, and 150 studies worldwide on this issue indicate that customers like this. But there is just too little experience with California’s residential customers while the customers themselves have too little information on which to make decisions as to costs versus savings.

Questions were also raised about Grid planning, to which respondents appeared to agree that too much is moving to identify a “right” strategy, especially as there isn’t even agreement on how to weigh technical issues such as reliability against other social goals we “should” be pursuing. The underlying complexity raised by these superficially straightforward questions was well-highlighted.

Michael Picker, President of the California Public Utility Commission (CPUC) noted that despite all the issues the CPUC addresses, DE issues are of significant importance. CPUC needs to consider even the framework for its decision making processes going forward. A system designed to regulate railroads in the 1890’s may not provide the responsiveness and flexibility for regulating changes to utilities in a rapidly evolving technological, economic and social environment. The “adversarial” approach used in CPUC proceedings may not be the best approach—why is the current process more dependent on legal skills than on engineering skills? The desire is to move forward not too fast, not too slow in opening the market to competition while allowing utilities to remain viable business entities. These are issues that could keep one up at night.

Michael Picker (CPUC, left) and Shayle Kann (GTM, right) during their “Fireside Chat”

GTM California's Distributed Energy Future Conference

The second, albeit lesser, recurring theme I heard at the conference was that of CCA developments. Until this year, there have been only three of these organized in California: Marin (with subsequent geographic extensions) and Sonoma were cited above, and Lancaster Choice Energy was launched in 2015. San Francisco’s Clean Power SF, Silicon Valley Clean Energy and Peninsula Clean Energy (San Mateo County) are in the process of launching this year.

As Mark Ferron, CAISO Board of Governors, cited, in 5 years 60% of the state’s eligible population could potentially be served by CCA’s if all programs now in discussion came to completion in that time. He provided a link in later discussion which I repeat here for those who want to follow up on the tally he reported: climateprotection.tumblr.com/tagged/Community-Choice

CCA’s make solar available to those in multi-family dwellings or who own a home not situated with a solar-favorable orientation or location. Expansion of solar power to these customers is required if solar-based power is to expand. Yet as Michael Picker observed, CCA “forced collectivization is a coup against the traditional utility model, challenging utilities and eroding the role of the PUC.” We don’t know yet where this takes existing suppliers and industry participants.

The challenges of the new, evolving energy infrastructure are actively being addressed by the states of California and New York. Conferences such as this provide an excellent opportunity to reflect on the issues and the difficulty this transition poses for firms competing in the market, regulators and the state legislatures who will eventually need to rewrite the rules for structuring state energy markets.

PG&E wants Marin Clean Energy customers to pay more for exit ticket

By Richard Halstead, Marin Independent Journal

The California Public Utilities Commission will rule this month on requests from Pacific Gas and Electric Co. that some say if granted could hinder the effort to boost renewable energy use in the state. PG&E is seeking permission to nearly double the monthly fee it levies on customers of Marin Clean Energy and other community choice electricity suppliers. The investor-owned utility is also proposing a change in net metering policy that would substantially reduce the financial incentive for installing residential solar power systems.

When a PG&E customer opts to buy electricity from another energy supplier, such as Marin Clean Energy or Sonoma Clean Power, the company is permitted to charge that customer an exit fee to compensate it for the power contracts it previously entered into to supply that customer’s electricity. The average Marin Clean Energy customer pays an exit fee of $6.70 per month. PG&E is requesting permission to nearly double the exit fee to about $13 for an average Marin Clean Energy customer. The increase would mean that, for the first time in several years, Marin Clean Energy customers would be paying more for their electricity than PG&E customers.

When PG&E loses a customer to another energy supplier, it sells the excess electricity that it purchased for that customer. The company might earn or lose money, depending on market conditions. So far, PG&E has stockpiled more than $1 billion from transactions in which it earned money. In conjunction with its request for a hike in the exit fee, PG&E initially asked the CPUC’s permission to absorb this money. Marin Clean Energy objected. The CPUC rejected Marin Clean Energy’s request that the money be used to offset the need for additional exit fee revenue and directed PG&E to submit an alternative proposal outlining its plans for the $1 billion next year.

Read full article in the Marin Independent Journal

Clean energy joint venture gains support: San Mateo County joint powers authority formed to buy renewable energy in bulk

By Bill Silverfarb, The San Mateo Daily Journal

About 297,000 PG&E customers in San Mateo County could get their energy from renewable sources in less than a year under a joint powers authority being formed called Peninsula Clean Energy.

The Office of Sustainability has been granted $1.5 million to form the joint venture known as Community Choice Aggregation that is already in place in Marin and Sonoma counties. The county will need at least three of 20 cities to join the JPA to get it off the ground. The hope, however, is that all cities will partner with the county to buy clean energy.

The JPA would allow its customers to buy renewable energy at competitive rates. In fact, customers who purchase 100 percent renewable energy from sources such as wind or solar will see their monthly electric bills rise by a modest $2, according to a technical study the Board of Supervisors heard Tuesday. A JPA agreement is expected to be in place by the end of winter 2016 and the tentative plan is to start purchasing renewable energy next summer.

Supervisor Dave Pine brought the proposal to the board in December and the newly-formed Office of Sustainability, directed by Jim Eggemeyer, has been working on the first phase of the proposal since. The second phase includes forming the JPA, which would be a nonprofit with a board made up of either elected city officials or appointees. The goal is to have it formed by March or April.

Read full article in the San Mateo Daily Journal

Related Article: Op-ed: Greener, cheaper electricity with community choice (The San Francisco Chronicle)

Critics: Marin Clean Energy not so clean and green

By Richard Halstead, Marin Independent Journal

A union representing Pacific Gas and Electric Co. workers and a San Francisco consumer group are taking aim at the common use of energy credits by groups including Marin Clean Energy. They’re pushing an initiative in San Francisco and new state legislation designed to curb such practices. Their contention: Marin Clean Energy and other purchasers of those credits, such as the city of Palo Alto, and the Sacramento Municipal Utility District, are using paper certificates to “greenwash” their energy. At issue is something known as an “unbundled, renewable energy certificate”—a credit that, when purchased, allows the buyer to legally claim ownership of 1 Mwh of renewable electricity. It has been “unbundled” from the actual renewable electricity that was generated.

The International Brotherhood of Electrical Workers, Local 1245, which represents PG&E’s electrical workers, is collecting signatures for a ballot measure that would bar San Francisco from promoting its electricity as clean or green if it uses unbundled RECs.  A second offensive is being mounted against the use of unbundled RECs in the state Legislature. Assemblyman Phil Ting, D-San Francisco, has introduced AB 1110, which would prohibit an adjustment in the calculation of emissions of greenhouse gases through the application of unbundled RECs. The legislation is sponsored by The Utility Reform Network, a consumer advocacy organization based in San Francisco.

Read full article in the Marin Independent Journal

Move Over PG&E? Community choice aggregation could be electrical balancing act

By J.A. Savage, The North Coast Journal

Humboldt County and the city of Arcata now have proposals from two private companies that are offering to whisk the agencies and their thousands of ratepayers away from PG&E. If either is hired, it would be the first community choice aggregation program in the state to hand the reins to a private company. The only municipalities in the state operating community choice — Marin County and most of Sonoma County — have done so through their own governments.

Arcata and Humboldt County are considering a more hands-off method through for-profit companies. Neither company with proposals for the governmental agencies has operated a program for non-PG&E alternatives before. Although Arcata could proceed on its own, it’s possible for the entire county to switch away from PG&E. Unlike most California municipalities, Humboldt already has a joint powers agreement among governments through the Redwood Coast Energy Authority, which has been in preliminary discussions to implement community choice aggregation for more than a year.

State laws governing electricity production say community choice aggregation has to be a mix of energy sources, and consumers have a say in what energy sources are included in their power mix. While you could save a few cents on your monthly bill with community choice, more important, say proponents, is that — unlike your dealings with PG&E —your elected representatives could increase or decrease how much renewable and Humboldt-grown electricity is in the mix. Local governments could require more biomass fuel for electricity from Humboldt’s forests, or require building new solar installations. By playing with the mix, consumers/voters can determine the cost of their electricity, to a certain extent.

Read full article in the North Coast Journal

California Utilities Ready Plans For Community Solar Programs

By Herman K. Trabish, Utility Drive

As mandated by Senate Bill 43, California is about to initiate a community shared solar program requiring its three dominant investor-owned utilities — Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric — to obtain 600 megawatts of new capacity by 2019. Solar advocates question the affordability of the utility programs.

Rooftop solar installers do not expect the community shared solar arrays to interfere with their business opportunities because subscribers are expected to be from the 48% of businesses and 49% of residences that do not have solar-suitable roofs. It could compete with municipal governments’ community-choice aggregation programs.

Read full article from Utility Drive