The Bay Area's economy has the potential to undergo a radical transformation. In fact, some communities are already creating their own public-power networks, buying renewable energy, and trying to build their own green-energy economies. But East Bay cities have been slow to embrace this new economic model, even though it would not only shift the literal sources of power for homes and businesses, but also potentially shift political power away from large energy corporations and into the hands of local governments, residents, and small businesses.
Since 2002, a little-known but potentially revolutionary law has been on the books in California. The passage of Assembly Bill 117 came in response to the energy crisis and the ensuing bankruptcy of Pacific Gas and Electric Company, which darkened much of the state and sucked billions of dollars from the economy into the coffers of Texas energy corporations. AB 117 was a strategic shift in a decades-old campaign to wrest economic power away from giant corporate utilities like PG&E and Southern California Edison and the big energy companies that supply them with electricity. AB 117 enabled a new model of energy provisioning, called Community Choice Aggregation, or CCA. Many have never heard of CCA, but few existing laws have as much potential to completely transform our economy from the bottom up.
Don't let the boring acronym fool you. In theory, CCA allows local communities to take control of their power-purchasing needs, while still using the distribution networks owned and operated by corporate utilities. The old model of obtaining community control over energy, whereby cities bought the entire system — poles, lines, transformers, and all — from the corporate utility and staffed a new public agency from scratch, had, by the 1990s, become an impossible task for numerous political and financial reasons. At the top of the list were the fiscal problems of local governments, devastated by decades of corporate tax cuts.
AB 117 eliminated the need to own the energy grid. It was a game-changing idea. Under the new rules, once a local government decides to become an aggregator (by automatically pooling the accounts of ratepayers within its jurisdiction to create a kind of energy-purchasing cooperative), or joins an existing CCA provider, it can choose what energy it will buy for its residential and commercial ratepayers. Communities can then decide to purchase renewable energy like geothermal, solar, small hydroelectric, and biogas — and no longer have to hope that the executives of their corporate utility, or state bureaucrats, will make the right choices for the environment and local economy.
Not only does CCA put decision-making power in the hands of local governments, but communities can theoretically go one step further by supporting the development of renewable energy sources either through the stimulation of private development (for where there is a demand there will arise a supplier) or by building publicly owned resources.
Most importantly, CCA also shifts the all-important financial power away from corporate utilities and the California Public Utilities Commission (which many activists characterize as suffering from "regulatory capture" by the companies it is tasked with overseeing) and places the power of the purse in the hands of local officials. With this ability comes the potential for reinvesting in conservation and efficiency programs, which according to most experts is the real opportunity for greening the grid, creating thousands of new local jobs, and lowering consumers' energy bills. If done right, many advocates say, Community Choice Aggregation would be nothing less than a revolution in power, both in the energy sense and the political sense.
But change is hard to make. Those Bay Area governments that have moved ahead with aggregation have been criticized by many activists and energy experts as pursuing CCA in name only, abandoning the three goals of cheaper bills, new jobs, and truly green energy. Worse still are the governments that have done little to nothing to explore and advance CCA, a long list that includes the East Bay's biggest energy user, Oakland.
But in spite of several years of lost opportunity, big changes may be on the horizon.
Hopes were high in the early 2000s for creating an East Bay CCA. Oakland, Berkeley, and Emeryville were part of a joint demonstration project funded by the California Energy Commission to explore aggregation. Each city committed tens of thousands of dollars to the effort and hired Navigant Consulting, an independent firm, to conduct a feasibility study and prepare an implementation plan. Fittingly, Oakland's money for the feasibility study came from a settlement reached with Williams Energy, and funds for the implementation plan from Duke Energy, two of the companies that gamed the energy crisis to gouge Oakland residents.
However, by 2008 this investment of time and hard-won money hit a wall. Navigant's studies came back with bad news for Oakland's leaders. Citing energy bills that could jump by more than 6 percent, potential city liability for CCA debts, and uncertain and possibly expensive regulations, the city administrator reported to the city council that, "although CCA appeared promising in the preliminary analyses, after a comprehensive review, the Business Plan does not support a recommendation to move forward at this time."
Oakland Councilwoman Nancy Nadel briefly put up a fight to save CCA. "Emeryville dropped their interest. Berkeley had some remaining interest," she said in an interview. "I wanted to call a joint meeting with Berkeley to educate ourselves about how well Marin was doing, and other efforts from other cities and counties doing CCA, but couldn't get the votes on the council to schedule it." According to Nadel, the Great Recession and the avalanche of problems it dumped upon Oakland quickly extinguished the council's ability to focus on CCA — an irony, given aggregation's potential to spur the local economy and build resiliency. Instead the city council was sucked into a vicious cycle of budget cuts, layoffs, and program eliminations, further dampening the region's economic outlook.