Dive Brief:

• The San Jose City Council this week voted unanimously to form the largest community choice energy program in California, ensuring residents will have more supply options than simply taking service from Pacific Gas & Electric.
• The vote requires San Jose Clean Energy to provide at least one option with 10% more renewable energy than PG&E’s power mix, as well as a 100% greenhouse gas-free option.
• Community choice aggregation (CCA) is growing in popularity in California, as the state's utility sector embraces more forms of customer choice. A recent report estimated that by the mid-2020s, up to 85% of retail load could be supplied through CCAs, rooftop solar and direct access providers.

Dive Insight:

While some concerns lingered about possible budget impacts, San Jose City Council's unanimous decision reflects California's growing embrace of community choice programs.

“While leaders in Washington continue to languish in a petroleum-fueled past, cities like San Jose will chart the path to a more sustainable future,” Mayor Sam Liccardo said in a statement. The program aims to lower San Jose's greenhouse gas emissions and boost renewable energy supply, at a cost-competitive rate, he added.

After several notifications, residents will be automatically enrolled in the new program, though they can choose to re-enter PG&E's service. The program will "spur local green energy production and boost the San Jose economy," according to Kerrie Romanow, environmental services director with the city.

Studies performed for the city concluded that if all consumers chose an electricity option with 10% more
renewables than PG&E, San Jose could see greenhouse gas emissions reductions from 10% to 18%. The program is expected to launch in 2018 and will serve 300,000 customers by 2019.

The growth of community choice aggregation has been a major contributor to customer choice in California. A new report from the California Public Utilities Commission and the California Energy Commission estimated more than 900,000 customers take service from a CCA.

Since Marin Clean Energy formed the state's first CCA in 2010, the CCA trend has been accelerating. Marin's program now serves more than a quarter million customers, and Los Angeles County is moving forward with a CCA that could eventually serve a million customers. 

The Mercury News reports San Jose City Councilman Johnny Khamis has some concerns about the CCA's possible budgetary impacts on the city, but he ultimately voted in favor of it anyway.

“Our residents are owed this security as we enter a new line of business and experience the risks and unknowns that naturally attend any new venture,” Khamis told the paper. He wants to ensure the program is separated from the city's general fund, so the cost of renewable energy does not impact critical services.