/Is ‘Community Choice’ Energy Really a Choice?

Is ‘Community Choice’ Energy Really a Choice?

When San Diego’s new publicly-run power agency first joined the local energy market, it made a big promise to customers: The energy it provided would be cleaner and cheaper than its competitor, San Diego Gas and Electric.

We now know that may not be the case, as MacKenzie Elmer explained this week.

Residents in five major San Diego cities will automatically begin buying their energy from San Diego Community Power in May. And although the agency wants its customers to only pay for the power their company buys, that’s not happening just yet.

That’s because of the Power Charge Indifference Adjustment, a so-called “exit fee” that SDG&E collects to pay for energy it bought for its customers back when it was a monopoly — before San Diego Community Power was a thing. 

The fee changes based on the cost of energy. It represented 31 percent of an average residential customer’s energy bill from San Diego Community Power in June 2021 and 18 percent in February 2022. 

Everybody pays this fee, both San Diego Community Power and SDG&E-only customers. It’s recently been added as a separate line item on SDG&E bills — called the “PCIA charge.”

The great debate now is, since public power agencies have no control over this extra charge, they want investor-owned utilities like SDG&E to explore how to reduce those costs for all customers. 

But the great debate over this story on Voice of San Diego’s website seemed to be whether customers joining the government-run alternative to SDG&E technically called a community-choice aggregator — is really a choice at all. 

Here’s what our readers had to say.

“…They forced customers to move to SDCP (I think because they couldn’t rely on people to switch to an unproven entity). I too will opt to stay with SDG&E,” wrote Julie Meier Wright. 

Steve Kurtzman responded, “…you are not ‘forced’ if you can say no and opt-out.”

Let’s clear that up. 

The 2002 state law that gave birth to government-run power purchasing companies made clear the “choice” in community choice aggregation is whether to leave it.

“Customers may aggregate their loads through a public process with community choice aggregators, if each customer is given an opportunity to opt out of their community’s aggregation program,” the law states.

Nicole Capretz, the executive director of Climate Action Campaign who was instrumental in San Diego’s adoption of a public power program, said public power advocates fought hard for that language.

“No community choice program would be successful if it was opt in,” Capretz said. “It’s human psychology; few people opt in to any program. Either people are too busy or don’t even look at their bills. In the program’s design, we knew it had to be opt out or else it would fail.”

By May, residential customers in Imperial Beach, La Mesa, Encinitas, San Diego and Chula Vista will all buy their power from San Diego Community Power unless customers choose not to. 

Some already have. 

So far San Diego Community Power has a 97 percent participation rate from the almost 90,000 accounts buying its power. About five percent of customers have chosen to opt-out already. The agency tracks those numbers and the reasons people give for leaving.  

Click here to view this chart in a new tab

About 23 percent of the “leavers” just don’t like being automatically enrolled, according to San Diego Community power documents. Another 18 percent are worried about rates or costs. About 5 percent are concerned about the government running their power. 

Back to the point of Elmer’s original story — San Diego Community Power’s Chief Operating Officer, Cody Hooven, said despite the “exit fee” their customers still have to pay for old SDG&E energy and the fact they’re automatically enrolled, she hopes customers recognize they’re getting “significantly cleaner power at a competitive price.”

What We’re Working On

  • The city of San Diego has been compiling a list of all its technical applications that meet the definition of surveillance and found a couple hundred so far. Jesse Marx got a peek at that list and found there’s tech across the city, including places you wouldn’t expect it.
  • Gov. Gavin Newsom this week moved California from the first to the second level of emergency actions taken during a drought. It likely won’t have much of an affect on San Diego. Here’s what it means.
  • San Diego County Board of Supervisors Chair Nathan Fletcher laid out plans to address homelessness, the region’s childcare shortage and more during the annual State of the County address on Tuesday. Read about his pledges here.

We’re nearing the end of our spring fundraising campaign and still have $44,000 left to raise. If you think our reporting is valuable, consider becoming a Voice of San Diego member today to help us reach our goal.