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By Will Fritz
Writer 

Lake Elsinore takes no immediate action on joining power-buying authority

 

Last updated 7/18/2018 at 9:49pm



Lake Elsinore’s city council at their July 10 meeting heard a proposal from the Western Riverside Council of Governments to join a new power-buying authority called Western Community Energy.

Perris has already signed on to the authority, known as a community choice aggregator or CCA, which WRCOG said could yield cost savings to electricity customers in the region.

Residents of a city that joins the CCA are automatically enrolled, but can opt out if they choose.

Other cities being asked to join the CCA include Temecula and Murrieta.

However, councilmembers in Lake Elsinore expressed skepticism at what kind of savings the CCA could actually yield and elected to withhold final decision.

“No one can guarantee savings,” WRCOG CCA Director Barbara Spoonhour told councilmembers. But she said projections show that electrical customers could save as much as 4.4 percent on their bills. Even with 2 percent savings, city customers could save $1 million annually as a collective, she said. City facilities could save $14,000 annually.

But Jeremy Goldman, government relations manager for Southern California Edison, told the council that joining the CCA would simply pass on costs to other ratepayers who don’t join.

“(Electrical) generation is a passthrough cost. There is zero profit on the generation of electricity to Edison. So if the Yates family was charged $25 for generation, the Edison company was charged $25,” Goldman said. “The best analogy I could give you is we’re at dinner, we order all kinds of food and then all of a sudden Councilmember Manos decides to get up and leave. Well, who’s left paying the bill?”

Shifting costs to existing customers is illegal under state law and is supposed to be fixed by exit fees that Edison and other utility companies can charge to customers who join a CCA. But no one can agree on how to calculate those fees, and the California Public Utilities Commission is set to have a solution by the end of the month. Depending on how high that fee is, customers may see a decreased payoff in joining the CCA.

Spoonhour said once the exit fees are decided on, they’ll be included in the projections.

She said WRCOG is asking cities to opt in to the CCA by Aug. 15 for the it to go online by 2020.

Goldman also said Southern California Edison paid the city of Lake Elsinore about $400,000 in franchise fees based on the number of electrical customers last year. It’s unclear how that would change under a CCA, and the council asked staff to prepare a report on that matter.

Councilman Steve Manos said he has a “philosophical” issue with the idea of joining the CCA.

“Power generation is a complicated issue, and that’s why the government should probably stay out of it,” he said. “Great opportunity, but I would probably put it off, and essentially with all of the items that are in flux, I couldn’t support that.”

But Councilman Brian Tisdale, who sits on the executive committee of WRCOG, didn’t see it as government intrusion in quite the same way.

“Everything that WRCOG has done is because member cities have asked them to do something,” he said. “This is not an organization that has taken it upon itself to be a big government.”

Tisdale urged his fellow councilmembers to try to have a decision by the August deadline, and said there were definite benefits to at least consider it.

“If we can’t save folks money and it’s not beneficial, then we’re not gonna move forward,” he said.

Will Frtiz can be reached by email at [email protected]

 

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