By Pilar Pinel
Working families struggling with the high cost of living in California have enough to worry about. The last thing they should have to put up with is paying extra on their electric bills to cover the cost of energy purchased for other customers. Especially when the law is supposed to prevent that from happening.
Unfortunately, the prospect of paying extra for power that was initially purchased for others is a legitimate concern for millions of electricity customers in California. As an advocate for Latina leadership and advancement, I am particularly concerned about how this may pose financial hardship for Latinas who are just starting out in the working world and are struggling to make ends meet while pursuing higher education. In some parts of the state, some customers are already paying roughly $150 per year more than they should. And that amount is expected to grow.
As alternative energy providers, including Community Choice Aggregators, have grown, regulations have failed to protect electricity customers who continue to be served by utilities like Southern California Edison. CCAs are government entities that take over the role of buying power for their residents while investor-owned utilities like SCE continue to be responsible for the delivery infrastructure that makes up the power grid and customer service.
I learned more about the urgency of this problem while attending a hearing in Sacramento toward the end of the last legislative session. It was disturbing to hear so many energy experts and other stakeholders representing consumer, senior, ethnic, labor and business all express concern that the current regulation intended to protect electricity customers is not working right and if not fixed soon, millions of customers will be paying more than we should.
At issue is the long-term clean energy contract utilities were mandated to purchase years ago to help the state achieve its clean energy goals and ensure reliability. The investments by utilities on behalf of their customers have improved our air quality, reaffirmed California’s environmental leadership role, helped jump start the renewable energy industry and make it more affordable today.
There is no question that everyone has benefited from these investments, and the intention was that everyone would contribute their fair share of the costs. That’s why when the legislature authorized the establishment of CCAs in 2002, it simultaneously took steps to ensure that, when CCAs are formed, there is no negative economic impact to customers who continue to receive power from their utility.
However, the regulation that is supposed to protect customers is not doing what it is supposed to do. In some parts of the state where CCAs have grown rapidly, customers of CCAs are only paying about 65 percent of the costs of the clean power contracts and other resources that were purchased on their behalf. Customers who still receive their power from their utility are currently making up the difference.
The problem hasn’t been as visible in Southern California, but since Los Angeles County recently voted to form a CCA, customers in other parts of Southern California may be paying more than they should if the regulation isn’t fixed soon.
Fortunately, the California Public Utilities Commission recognizes the problem and has opened a formal proceeding. According to the Commission’s timetable, the soonest a proposed solution would be released is July of next year. Actual implementation will likely take longer.
No hard-working Californian, especially young Latinas (particularly when Latinas are increasingly becoming head of household figures) and Latinos who are just starting out on a path toward a career, should pay more than their fair share for investments that were mandated and made to improve our environment.
Let’s hope the CPUC acts before more electricity customers are forced to pay more than they should.