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Community Choice Energy

The City of Carlsbad is partnering with the cities of Del Mar and Solana Beach to create a new community choice energy joint powers authority that will provide an option for local customers to purchase power from more renewable sources.

The Clean Energy Alliance will hold its first meeting Tuesday, Nov. 5, 2019.

Next Steps

  • The Clean Energy Alliance will meet over the coming weeks to complete the implementation plan by the end of the year. This includes hiring key vendors and staff, setting operational policies, and establishing the energy supply mix, rates and programs. The implementation plan needs to be submitted to the California Public Utilities Commission by Dec. 31, 2019.
  • The Clean Energy Alliance plans to provide power to its customers and launch the Community Choice Energy program in 2021.

Background

State law allows local governments to form Community Choice Energy programs that offer an alternative to investor-owned utilities, such as SDG&E. Under this model, local governments purchase and manage their community's electric power supply, and the existing utility continues to distribute the energy to customers. 

Marin County was the first to create a California Community Choice Energy utility in 2008. Today there are 19 Community Choice Energy programs operating throughout California. In San Diego County, Solana Beach began using this model last year, and other cities and the county are exploring it currently. 

Feasibility study

An April 16, 2019, study shows the Community Choice Energy model is technically feasible and would save Carlsbad ratepayers 2% a year compared to SDG&E. The study is available for review on the city’s website. 

The study describes some of the potential risks and concerns associated with Community Choice Energy, which include power supply costs, financial risks, customer participation and the availability of renewable power. The study shows that even when taking these variables into account, costs projected under most combinations of variables and potential market conditions will not negatively affect Community Choice Energy rates compared to SDG&E rates, and where negative impacts may exist, those risks can be mitigated. 

Questions and answers

What is Community Choice Energy? 

Community Choice Energy is a model that allows communities to purchase power to meet their electricity needs, offering an alternative to the traditional SDG&E model. Community Choice Energy can provide the communities they serve with competitively priced, clean energy choices while reinvesting revenues into projects and programs, supporting the local economy. 

How does Community Choice Energy Work? 

Community Choice Energy models are established by local communities, either through the creation of a multiple agency partnership or new city or county department. While Community Choice Energy programs are locally operated, they work in partnership with the region’s existing investor owned utility, SDG&E. Through this partnership, Community Choice Energy programs determine the source and procure the electricity while the existing utility company, SDG&E, continues delivering the energy, maintaining the grid and providing billing services. 

Who’s in Charge? 

Community Choice Energy programs are governed by a board or council of local elected officials who oversee decisions regarding power purchasing, programs, and rate setting, and are directly accountable to the people who elected them. Meetings are conducted in an open, transparent manner, ensuring the public has a voice in the Community Choice Energy decision-making process. 

What Happens to the Revenues?

Because Community Choice Energy programs are locally managed, not-for-profit entities, any excess revenue is reinvested into the community through on-bill savings and innovative energy projects and programs, including rebates and other incentives, low-cost energy programs, job training and more.

What Are Some Benefits to Community Choice Energy?

Community Choice Energy programs are committed to providing clean, renewable energy choices at competitive rates and creating innovative programs that benefit people, the environment and the economy. 

Here are some of the ways they empower local communities: 

  • Cost-saving or competitive rates 
  • Local control and increased transparency
  • Cleaner power supply – reduced greenhouse gas emissions 
  • Local power, local jobs – revenues stay local
  • More competition, better service

More Information

Contact

Contact Jason Haber, assistant to the city manager, 760-434-2958 or jason.haber@carlsbadca.gov