California public power utility SMUD on Sept. 1 said that it has been selected to negotiate a services agreement to provide Valley Clean Energy Alliance, a new community choice aggregation joint powers agency, with technical and energy services, data management/call center services, wholesale energy services, credit support services and up to five years of business operations support.
SMUD noted that this is its first services agreement in the fast-growing CCA market.
Valley Clean Energy Alliance, or VCEA, is set to begin serving electricity customers located within the California cities of Davis and Woodland and unincorporated areas of Yolo County in the summer of 2018. VCEA’s mission “is to deliver cost-competitive clean electricity, price stability, energy efficiency and greenhouse gas reductions,” SMUD said in a news release.
“We’re excited that VCEA has chosen SMUD to help launch and operate the first CCA in our region,” said SMUD CEO and General Manager Arlen Orchard. “We have the operational knowledge and technical expertise to help VCEA hit the ground running on day one and be successful over the long term.”
Don Saylor, Yolo County Supervisor and VCEA board chair, said that while VCEA had a number of service providers to choose from, with SMUD’s “depth of expertise, cost competitive proposal, and close alignment with VCEA’s mission, the exceptional value of SMUD’s proposal was clear.”
SMUD said it is entering the CCA services market because it wants to support organizations with values closely aligned with its own. “These values include local decision making, affordable rates, greenhouse gas reduction, energy efficiency and a not-for-profit, public-power business model, among others,” the utility noted.
The revenue that SMUD earns from providing services to VCEA will help SMUD invest in building out a modern energy grid that can successfully integrate more distributed and renewable energy sources and meet evolving customer needs, as well as improve the technology that SMUD customers use to monitor and manage their energy use, SMUD said.
SMUD noted that CCAs are a means for cities, counties and some special districts to buy power for their communities.
Also known as community choice energy, the ability to form them was created with legislation in California in 2002. CCAs can only be formed in the service territories of investor-owned utilities such as Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric, SMUD said.
By the end of 2017, approximately 13 CCAs will be operating in California and more than 20 additional communities are considering CCAs, SMUD noted.
All customers are enrolled in their CCA unless they opt-out. The CCA purchases the power for their customers and typically offers renewable energy choices such as solar and wind power. The IOU still delivers the power over its transmission and distribution systems and is responsible for providing customers with a single electric bill, SMUD said.
CCAs typically contract with third parties to handle most of the activities required to launch and operate.
Calabasas city council takes step to join CCA program
The city council in Calabasas, Calif., in May approved a joint powers agreement with Los Angeles County — the first step to joining a new CCA program offered by the county.
The new county energy aggregation program, approved unanimously by the Los Angeles County Board of Supervisors on April 18, is called the Los Angeles Community Choice Energy Program.
Other states have enacted CCA legislation
Several other states have enacted legislation that allows for CCAs including Ohio, New Jersey and Massachusetts.
