II. Background on AB 117
California's energy crisis motivated some local governments and communities to take a more active role in energy policy and planning on behalf of local residents and businesses. In some cases, local governments may be in a position to implement energy programs. Responding to the interest of local governments in energy policy and programs, AB 117 allows local governments "...to elect to combine the loads of its residents, businesses, and municipal facilities, in a community-wide electricity buyers' program." (Pub. Util. Code § 331.1(a).) The statute permits a local government board, or combination of governments to create an entity called a "Community Choice Aggregator" (CCA), which may procure electricity on behalf of local citizens, businesses, and itself.1 AB 1172 provides local governments greater discretion over the type and source of electric generation their communities use.
AB 117 involves Commission-jurisdictional utilities by requiring them to continue to provide distribution, metering and billing services to the CCA's energy customers. It requires those utilities to provide certain types of notice to CCA customers and to act as providers of last resort. AB 117 also directs the Commission to assure the utilities recover certain costs, including those associated with energy contracts signed by the state's Department of Water Resources (DWR) and the costs of providing ongoing services to CCAs and their customers.
AB 117 directs the CCA to provide the Commission with an "implementation plan" (Pub. Util. Code § 366.2(c)(5)) and a "statement of intent" as part of a registration procedure. (Pub. Util. Code § 366.2(c)(4).) AB 117 appears to make the CCA responsible for ratemaking, customer rights and obligations, customer protection, universal access, reliability, and equitable treatment of all customer classes.
This order proposes rules addressing the responsibilities of the electric utilities, the cost recovery mechanism and re-entry fees, notification requirements, transaction costs, and the process CCAs would use to register with the Commission. In general, we propose to adapt many existing procedures and rules to CCAs wherever possible in order to facilitate the initiation of the program and implement the statute. The rules and charges we have developed for "electric service providers" and "direct access" customers may be applicable in many cases, as we describe in subsequent sections. A copy of AB 117 is attached as Attachment B.
1 AB 117 allows local governments to procure and provide electricity to retail customers. It does not allow local governments to provide natural gas to customers. 2 AB 117 also enables local government to pursue demand side management programs to reduce their community's energy usage, including increased coordination with Public Goods Charge (PGC) energy efficiency and conservation program administrators and the ability to apply for PGC administration and funding for energy efficiency and conservation programs on behalf of their customers. We address this issue in Rulemaking (R.) 01-002-028.
