years ago, California was faced with rolling blackouts and a major
energy crisis. It may not seem like it, but another energy crisis
is brewing – this one caused by cities getting in the business of
buying and selling electricity.
was a lack of oversight and poor deregulation that led to those
blackouts, when bad actors such as Enron saw an opportunity to
game the system, manipulate energy markets and ultimately crash
government-run energy programs – also known as Community
Choice Aggregation – are unraveling the
centralized planning and service California needs to keep the
the former mayor of San Diego, I can see why CCAs
are attractive to some local lawmakers
since they’re billed as cheaper and greener alternatives. But they
aren’t delivering on their promises and it’s not a program I would
have introduced to
programs produce very little new renewable energy, instead buying
from existing sources, including out-of-state wind and solar
farms. They take credit for improving our environment but they’re
not actually reducing carbon emissions. For example, Marin Clean
Energy, California’s first CCA, was launched eight years ago and
is held up as a model. Yet it has not delivered more than 10
percent of its power from new clean energy sources in any year.
energy might one day deliver the benefits it promises, but the
current market was not designed to support CCAs. Their customers
can always return to utility companies. This risk, combined with a
lack of credit, means that CCAs are reluctant to purchase
long-term contracts for renewable energy, or build new facilities.
utility companies buy nearly all their renewable energy under
long-term contracts that lead to new renewable generation
development, this has all but stopped because of the uncertainty
caused by CCAs.
some labor leaders strongly oppose CCAs because they are not
creating more jobs. Worse, utility customers in neighboring cities
are forced to pay higher energy bills to subsidize them.
why is California seeing an acceleration of these programs, and
why is San Diego even considering forming what would be one of the
are under pressure to comply with their own Climate Action Plans,
even though all existing CCAs fall well short of achieving the
goal: 100 percent clean energy use.
only way for energy providers to meaningfully reduce emissions is
to build more wind, solar, and other green energy sources. CCAs
aren’t achieving that, but they do expose cities to significant
risks. In San Diego, a city study found that a CCA could require
annual revenues of as much as $961 million.
there are many reasons to be skeptical of government-controlled
energy. Local leaders should focus on building more housing near
job centers, conserving water and increasing energy efficiency
through numerous strategies that do not expose cities and their
residents to financial risks or power outages.