ORIGINAL REPORTING: As California customer choice expands, are reliability and affordability at risk?
As California customer choice expands, are reliability and affordability at risk? Many say the disruption from multiplying power providers in California could also put the state's decarbonization achievements at risk.
Herman K. Trabish, July 9, 2018 (Utility Dive)
The customer choice movement is exploding in California. There are now 44 load serving entities (LSEs), including community choice aggregations (CCAs) serving residential and smaller business customers and energy service providers (ESPs) providing direct access (DA) to power for larger commercial-industrial consumers. Between the two, California's investor-owned utilities (IOUs) could have less than 20% of their retail sales left by the mid-2020s, according to a 2017 CPUC white paper, if regulatory challenges and legislative votes go in favor of customer choice. Until those challenges and votes are resolved, energy procurement is nearly at a standstill and questions about enforcement of California energy policy are growing. Many say this disruption from multiplying power providers in California could put the state's nation-leading achievements in decarbonization, affordability and reliability at risk.
The disruption and risks from proliferating energy providers were the key focus of a June 22 forum on customer choice with members of the California Public Utilities Commission (CPUC) and the California Energy Commission (CEC) alongside representatives of CCAs and ESPs. To get at the question about impacts on California's environmental and reliability progress, regulators at the meeting asked two specific questions about the growing disruption's risks. The first focused on California's resource adequacy (RA) needs. It is not clear if the fast-multiplying but disaggregated CCA, ESP, and incumbent utility LSEs can take on the extra burden and cost of underserved regions. The other question was how to manage customers moving between LSEs in search of the best deal. Until now, IOUs acted as providers of last resort (POLRs). But they are losing revenues to new competitors. The CPUC raised these and other concerns in the May 7 Green Book. Advocates for customer choice do not believe their movement represents a threat… click here for more