FAQ: Community Choice Energy and Orange County Power Authority
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- What is Community Choice Energy?
- What are the risks and benefits of CCEs?
- How do I enroll in a CCE?
- What is the Orange County Power Authority (OCPA)?
- What is Huntington Beach’s fiscal impact to join OCPA?
- How does OCPA operate and how will it be administered?
- Will OCPA displace SCE in Huntington Beach?
- So, what's next?
- How will my OCPA rate compare with my SCE rate?
- Will customers directly receive the renewable energy purchased by the OCPA?
- Will low-income support programs still be available through OCPA?
- Which jurisdictions in California have a CCE?
- To learn more, who should I contact?
1. What is Community Choice Energy?
In 2002, Assembly Bill 117 opened the door for Community Choice Energy (CCE), also known as Community Choice Aggregation, which permits California cities and counties to purchase electricity on behalf of their communities. For many decades, Southern California Edison has been the sole entity that has acquired power for Huntington Beach. However, the CCE’s purchasing power introduces competition into the energy market, providing customers with a choice, where none currently exists. It is important to note that the CCE’s role is limited to the purchasing of power, not its delivery. Southern California Edison remains in control of remaining steps in the energy cycle: transmission, distribution, metering, and billing.
2. What are the risks and benefits of CCEs?
CCEs may be an attractive option for communities that want greater local control over how their power is generated. Historically, CCEs have been established with environmental goals in mind and often procure power from renewable energy sources (i.e. wind, solar) to more rapidly shift away from sources that emit greenhouse gases. According to the Luskin Center for Innovation at UCLA, California CCEs offer an average of 52 percent of electricity from renewable sources.
3. How do I enroll in a CCE?
Per Assembly Bill 117, all customers in a CCE jurisdiction are automatically enrolled. During the transition, customers should not experience any disruptions to their service, since transmission, delivery, maintainance and billing would continue to be provided by the local utility (which is Southern California Edison in Huntington Beach). However, customers who prefer to stay with the local provider may opt out for free, during a designated period of time.
4. What is the Orange County Power Authority (OCPA)?
The City of Irvine spearheaded an effort to create a regional CCE known as the Orange County Power Authority (OCPA) and invited all Orange County cities to join. While Irvine may be able to operate the OCPA on its own, adding member cities increases OCPA's overall energy demand, which helps it negotiate more competitive rates for residents. In February 2021, the Huntington Beach City Council voted to join OCPA as a founding member, following a full financial risk assessment and discussion of the findings.
5. What is Huntington Beach’s fiscal impact to join OCPA?
Member agencies are not required to make any financial contributions when joining the OCPA. In lieu, the City of Irvine will finance all initial start-up costs which include:
- OCPA agency start-up costs of ~$2.5 M.
- Initial working capital cash, which is estimated to be $8 - $17 M, depending on the participation level in the initial JPA agency.
During the first 5-7 years of operation, OCPA will repay Irvine’s investments and build up proper financial reserves. After initial debt service costs are repaid, it is estimated that a significant amount of net income will be available to OCPA for use towards customer program or additional electrical rate discounts.
6. How does OCPA operate, and how will be it administered?
At build out in 2023, OCPA is expected to have sufficient employees and energy contractors who will provide the expertise to successfully operate OCPA, purchase power, and follow all regulations per Assembly Bill 117. Personnel and staff costs are paid by OCPA, using rates charged to its customers.
The governing body of OCPA is a Board of Directors consisting of one director from each member agency, with the exception of Irvine which will have two directors until its capital loan is repaid in full. The Board has also appointed a Chief Executive Officer and set policy and energy rates, following careful discussion, evaluation, and approvals made during public meetings. It is important for the City of Huntington Beach to join as a founding member and receive a place on the Board of Directors, where major policy decisions about the OCPA are made.
7. Will OCPA displace Southern California Edison (SCE) in Huntington Beach?
Establishing a CCE does not sever the community’s ties with SCE. SCE still owns and manages the transmission lines that are necessary to deliver power to customers - whether they join OCPA or stay with SCE.
OCPA customers will continue to receive the same delivery, maintenance and emergency services from SCE, as well as the same bill from SCE. The only change they'll see is a new line item on their SCE bill, indicating what share of their utility payment will be delivered to OCPA for the amount of energy they've used. They'll make just one payment to SCE - as usual - and SCE will ensure that OCPA's share of the payment is received.
8. So, what's next?
All SCE customers will automatically be enrolled in the OCPA when it launches. However, customers can make a few choices. The first choice is to decide to (1) remain an OCPA customer which requires no action on the customer's part or (2) opt out of the OCPA and return to SCE.
Please note: commercial customers have already transitioned in Spring 2022, and residential customers will transition in October 2022. Please refer to any OCPA mailers and their website at www.ocpower.org for details on time frames to opt out, if needed.
9. How will my OCPA rate compare with my SCE rate?
Customers who stay with OCPA will have an additionl choice - this time regarding their electricity rate:
(1) Keep the 100% Renewable Choice default rate sourced from 100% renewable energy sources. This requires no action on the customer's part. This default rate is ~1.5 cents per kWh higher than the default SCE rate which comes from ~34% renewable energy sources, or
(2) Select the 69% Renewable Smart Choice which is approximately 1 cent per kWh higher than SCE's rate, or
(3) Select the 38% Renewable Basic Choice, which is the same as SCE's rate
To obtain an estimate of the potential cost difference between your SCE and OCPA bill, please gather your latest SCE bill and enter required information in this comparison calculator on OCPA's website.
If you feel that OCPA rate options are not for you, you may opt out of the OCPA within their opt out timeframe and return to SCE. For details visit OCPA's opt out page.
10. Will customers directly receive the renewable energy purchased by the OCPA?
Not necessarily. The OCPA puts the same amount of electricity in the grid that its customers use. When the individual electrons from all power sources enter the grid, no agency can determine or apportion those electrons directly towards OCPA. However, OCPA would have the advantage of deciding where to purchase its energy and would know that it is contributing towards a greater reliance on more renewable energy sources.
11. Will low-income support programs still be available through OCPA?
Yes. OCPA will use revenues from the sale of power towards programs to support low-income customers, in addition to other energy-related projects and programs that benefit all customers.
12. Which jurisdictions in California have a CCE?
There are 23 CCE programs serving more than 10 million customers in California. Dozens of communities are either engaged in or currently considering a CCE. In addition, other states such as Illinois, Ohio, Massachusetts, New Jersey, Rhode Island, and New York have developed their own community choice programs.
13. To learn more, who should I contact?
For more information, please contact the Orange County Power Authority at ocpower.org or 866-262-7693. To connect with the City of Huntington Beach, please send an email to [email protected] or call 714-536-5579.
Did you know?
The City maintains 124 traffic signals. Report malfunctions to (714) 960-8861(City) or Caltrans (PCH & Beach Blvd) (949) 936-3600. You can also report a malfunction online.
