Comstock's magazine 1118 - November 2018 - Page 40

n ENERGY D avid Baker has noticed a change in his energy bill. The president of RobbJack, a Lincoln-based man- ufacturer of carbide cutting tools, used to get his electricity from Pacific Gas & Electric, until this past February when Pioneer Community Energy launched in Placer County. Baker says representatives from Pioneer worked closely with him on a plan to cut electricity costs. RobbJack runs air conditioning and power for indus- trial machines in a 42,500 square-foot space, so Baker says even small savings make a big dent. Pioneer’s entrance into the market has also been a win for Thunder Valley Casino Resort, another customer. It has seen rates drop by 2-3 percent, says Doug Elmets, a spokes- man for the United Auburn Indian Community, which owns the casino. For a facility that’s open all day and all night, and cycles through 16,000 people every 24 hours, that’s a significant savings, he says. (Pioneer customers save 5-7 percent compared with PG&E, according to Pioneer’s data.) “Currently, we know collectively we’re saving ratepayers here in Placer County $10 million a year,” says Placer Coun- ty treasurer and tax collector Jenine Windeshausen of the switch to Pioneer. “And it’s highly likely that money is going to be spent here.” Pioneer is just one of a large number of “community choice aggregators” — electric-power purchasing organi- zations run by a municipal or county government or some combination of the two — that have entered the state’s en- ergy market in recent years. Valley Clean Energy, which launched June 1, serves Woodland, Davis and unincorpo- rated Yolo County. CCAs are quickly taking over from investor-owned util- ities how electricity is bought in California. They’re the lat- est test of whether local, publicly run ventures can deliver cheaper and cleaner power. But electricity procurement can be a fickle industry, and time will tell how well they’ll navi- gate regulatory and market changes. GAINING GROUND The state’s electricity crisis in 2000 and 2001 helped pave the way for an influx of CCAs. The shortage of electrical power and resulting large-scale blackouts led policymak- ers to rethink the rules governing the industry. In 2001 and 2002, a package of bills was passed to ensure there wouldn’t be a repeat, including a 2002 law that authorized the forma- tion of CCAs. But setting up the technical and governance structures took time, and the first CCA — Marin Clean Energy — wasn’t launched until 2010. With MCE’s launch came a template for others to follow, and the number of CCAs is growing: To- day there are 18, nine of which started this year. If current trends hold, within 10 years, CCAs may serve the majority of 40 | November 2018 the state’s consumers now served by the big three investor- owned utilities, according to a July report from the UCLA Luskin Center for Innovation. Lower energy rates are a fundamental aspect of the CCA promise: Valley Clean Energy set its rates 2.5 percent below PG&E’s, and Pioneer’s have come in an average of 9 percent lower. Their boards are made up of local elected officials who regularly face voters and are therefore, proponents say, incentivized to negotiate harder on contracts. And as nonprofits, they don’t need to build in returns for private shareholders or pay federal taxes, says Pioneer spokesper- son Alexia Retallack. CCAs also say they’re more accessible to customers and able to adapt to their needs. “People can walk into our office [on Second Street in Davis] and talk to the executives,” says VCE spokesperson Jim Parks. As VCE was planning its launch, there was a small up- rising of rooftop-solar customers worried they’d pay more under VCE than PG&E. So VCE held public meetings that brought out standing-room-only crowds. The board took comments, and as of August was working on a new proposal. RepowerYolo, a Davis-based solar consulting company that runs an influential blog and was skeptical of the original plan, advised customers to stick with VCE after the hear- ings, writing on its blog that VCE “listened to our concerns, analyzed our recommended changes” and “is diligently do- ing the right thing.” The timing is also ripe for CCAs: Electricity prices are far lower now than when investor-owned utilities were re- quired under state law to invest millions in contracts for re- newable energy from 2002 to 2012. MORE RENEWABLE OPTIONS Electricity will make or break California’s ambitious cli- mate agenda. By 2030, state law requires greenhouse gas emissions to fall 40 percent below 1990 levels. Under a new law passed in September, 100 percent of the state’s electrici- ty generation must be carbon free by 2045. That means ever- rising demands on the grid: more electric vehicles plugging in, electric heat pumps replacing gas boilers, induction stoves taking over from their gas-fired relatives. The state’s electricity sector as a whole is getting cleaner: One-third of electricity procurement by all providers must be renewable by the end of 2020. The state’s investor-owned utilities are there already, generating 35 percent of their electricity from renewable sources on average. But the CCAs are doing even better, while increasing the overall share of renewables on the grid: A May 2017 Luskin Center analysis concluded that all five of the state’s CCAs then in operation sourced a larger share of renewable ener- gy than did their affiliated investor-owned utilities. Locally,