Board Opens Bidding on Project to Establish Countywide Energy Co-op

RIVERSIDE COUNTY, CA – Riverside County supervisors Tuesday authorized the solicitation of bids from firms qualified to draft plans for an energy purchasing cooperative that could lower electricity costs for residents countywide.

"I think this is a great thing we're doing," Supervisor Marion Ashley said just before the 5-0 vote. "We can save people in the unincorporated areas and elsewhere a lot of money.

"The energy industry is rapidly evolving, and it's important to position the county to take advantage of this new endeavor," Ashley said. "I hope this bears fruit. I think it will if we work hard at it."

The Board of Supervisors in June approved general provisions for the establishment of a Community Choice Aggregation program. Now the county needs to find a company with the necessary expertise to write a proposal for the CCA that will pass muster with the California Public Utilities Commission.

According to documents posted to the board's policy agenda, the qualifying firm must be able to create an implementation plan that details "organizational structure of the (CCA) program," "rate design," "due process in setting rates," "rights and responsibilities of program participants," and addresses a variety of contingencies.

All bids will go through the Department of Purchasing and Fleet Services, which typically accepts bid proposals over a three-month span, seeking the most "responsive and responsible bidder" offering the best price to do the work.

County Legislative Affairs Director Brian Nestande introduced the CCA concept in January, which culminated in the hiring of retail commodity firm Good Energy, based in New York City, to conduct a feasibility study on a countywide CCA.

Research suggested that by converting to a co-op, county residents could net a total $7.75 million in annual savings on electricity costs -- or about 9 percent off each resident's power bill in the unincorporated communities. The study also indicated that commercial customers could shave up to 10 percent off their bills, though figures tended to fluctuate depending on the nature of the enterprise.

According to the study, the co-op functions similar to a municipally owned-and-operated utility, giving the front-end buyer, in this case the county, the opportunity to tap a variety of energy sources for delivery to customers. The idea is for communities to form partnerships, making block purchases at preferred rates.

CCAs have been formed in five locations statewide, the largest coming online in San Francisco, according to Good Energy. Cooperatives are also in use in parts of Illinois, Massachusetts, New York and Ohio.

In Riverside County, Good Energy mainly examined the service delivery and costs borne by Southern California Edison customers.

Households consumed the highest volume of electricity -- 34 percent -- followed by large industrial operations at 28 percent. The cumulative total electricity used in the unincorporated areas came to 2.1 billion kilowatt-hours in 2015, according to Good Energy.

The study found that shifting to a market-driven purchasing plan under a CCA would result in "clear savings" to a high number of customers. However, utility rate structures that rely on "load factor" to determine a customer's monthly bill might be more beneficial to some electricity consumers who tend to need greater wattage.

SCE currently uses "load profile" to calculate rates, though the investor-owned utility is migrating to "smart meters," according to Good Energy.

If the CCA were to go live in Riverside County, all customers would still have the freedom to "opt-out" and remain with their current provider, according to Nestande.

He noted that ratepayers currently served by municipalities with their own utility companies, like the city of Riverside, would not be able to participate in the CCA.

CCAs received legislative approval in 2002 and were partly a response to energy market disruptions two years earlier.

Ashley and board Chairman John Benoit agreed today to serve as members of a subcommittee that will monitor developments of the county CCA.

– By PAUL YOUNG, City News Service / Image via Shutterstock.