California Sets New Rules for Community Choice Aggregators

In California, Community-choice aggregators, or CCAs, are cities or counties that have taken over key aspects of their own electricity and natural-gas procurement, distribution and sales from one of the state’s three big investor-owned utilities. From a slow start in 2010, the ranks of CCAs have grown to include eight operational entities with more than a dozen more being formed or expanded at present. Their benefits have led to CCA legislation being passed in states including New York, Massachusetts, Illinois, New Jersey, New York, Ohio and Rhode Island.

But to the state’s investor-owned utilities, CCAs are an existential threat to their business models — a mechanism that takes away their customers, while leaving them with the burden of managing the power lines, maintenance crews, and the customer service platforms that keep the system running. How those costs are shared between CCAs and utilities has been a longstanding point of contention between the two.  Last week, the California Public Utilities Commission adopted a resolution that will force future CCAs to take up at least one part of this common burden — resource adequacy.

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