Sunday, June 15, 2025

As Coronado Considers Clean Energy Switch, Concerns about CCAs Arise

Power lines in California. Photo: yhelfman / iStock

Before making a decision about whether Coronado should shift its energy procurement to a Community Choice Aggregation (CCA) program, the City Council wants to learn more about them.

Chief concerns include financial risks, potential costs to small businesses, capacity violations CCAs are facing, and staffing concerns.

“I don’t think we should move into CCA lightly, without a heck of a lot of research,” said Councilmember Mark Fleming during the June 3 meeting of the Coronado City Council.

Councilmember Amy Steward, who supports the transition, suggested that the city invite the two regional CCAs to present at an upcoming meeting to answer questions.

“We started this process back in 2022 asking for reports, and then we asked for another report,” Steward said. “And now here we are: It’s 2025. Three years have already gone by. We could have already been in a CCA, already reduced our carbon footprint.”

The city plans to form a subcommittee to investigate the matter at its June 17 meeting.

When using a CCA, public utilities continue to deliver power and handle billing, but a board determines energy procurement. These programs generally focus on choosing sustainable energy sources. Because they are non-profit entities, they must reinvest income after reserves into local energy programs, which is not the case with investor-owned utilities.

All municipalities in San Diego County have joined a CCA except for Coronado, El Cajon, Lemon Grove, Poway, and Santee. Coronado is evaluating two regional CCAs: San Diego Community Power (SDCP), and Clean Energy Alliance (CEA).

A staff report estimates that joining a CCA could reduce nearly 10,000 metric tons of carbon dioxide equivalent annually. For context, all the city’s combined local reduction strategies carry a 12,600 metric tons of carbon dioxide equivalent reduction.

However, as the council discussed the option, several concerns arose, and the council agreed that it needed more information before making a decision.

“I want to make sure we do this right,” Councilmember Carrie Downey said. “I want to make sure that we enter into something that we can support as community, not to just jump in because everybody else does.”

Financial risk

The council worried that joining a CCA could carry unintended financial risks through liabilities, exit costs, and staff time.

In 2021, the board of directors of Western Community Energy (WCE) declared bankruptcy, citing the COVID-19 pandemic and Aug. 2020 heat waves as reasons. Baldwin Park subsequently exited the CCA, and a city staff report lists losses of $9.7 million for the move.

In 2023, Huntington Beach left the Orange County Power Authority (OCPA), and Orange County pulled out of its contract with OCPA in 2022. Many customers were opting out of the CCA, the Orange County Register reports, which resulted in fewer CCA customers and gradually inflated rates. The agency’s CEO, Brian Probolsky, was fired in 2023 after failing four state audits. OCPA has since resolved state recommendations and its latest audit was favorable, said Jacquie Henderson, director of communications and external affairs for the OCPA.

During the meeting, several people cited $50 million in Huntington Beach’s taxpayer funds that were left in the CCA during its exit two years ago, but that figure seems to stem from this opinion article. It is difficult to determine where the number came from or exactly how much it cost the city to leave.

But that, Coronado’s council members say, is the point: It is hard to make a decision without addressing such unknowns.

“I do think there could be a financial burden that could hit us at some point,” Councilmember Kelly Purvis said. “I can’t believe everything is going to be free.”

California has 25 operational CCA programs, and not all of them are embroiled in drama or exits by member cities. Most municipalities in San Diego County are members of a CCA. The model is relatively new, and was introduced in California by the 2002 passage of Assembly Bill 117.

In addition to exit costs, the council also worried about administrative costs. Under a CCA model, the board of directors determines energy procurement, and Coronado would have a seat on that board. (Depending on the CCA, it could be a rotating seat.) The concern is that a CCA could strain staff time and resources, removing attention from its other projects.

The subcommittee will scrutinize potential CCA agreements to assess potential liabilities and financial implications of joining one.

Costs to small businesses

Residential energy prices are, on average, either similar to or slightly lower than rates for power procured from a traditional utility.

However, Mayor John Duncan honed in on a potential rate hike for small businesses under the CCA model. The city is considering two regional CCAs: San Diego Community Power (SDCP) and Clean Energy Alliance (CEA).

During a presentation, a slide showed 19.7 percent higher rate for “small commercial customers” from SDCP. The discussion did not foray much into why that rate might be so high, but it is one of the chief questions the subcommittee will explore.

“If it’s true that 90 percent of our businesses would have their power rates increased by approximately 20 percent, I wouldn’t support that,” Duncan said.

Resource adequacy violations

The state mandates capacity requirements for CCAs to ensure reliable electricity supply, and both CEA and SDCP have violated these requirements.

A 2022 report from the California Public Utilities Commission listed two citations for CEA, the smaller of the two CCAs, with fines of $616,627. That same year, SDCP received 4 citations for $5 million.

When under violation, the CCAs are not allowed to add new member cities. Both of the CCAs Coronado is considering are on pause from adding new member cities until they can address these concerns. Both CEA and SDCP are currently on a pause.

The subcommittee will investigate how the CCAs are addressing these issue and planning for future capacity needs.

Weighted votes

Of the two CCAs that Coronado is considering, SDCP serves southern San Diego County and has more customers. However, it also allows weighted voting, which could give San Diego a 49 percent vote share. The board has not called for a weighted vote before.

Two years ago, weighted voting caused a stir at the San Diego Association of Governments (SANDAG). At one point, leaders from smaller cities walked out of a board meeting, saying that small cities did not get fair representation on the board due to the weighted vote system.

In 2022, Coronado and three other one-vote cities lost a lawsuit against SANDAG, alleging that the weighted vote unfairly shouldered them with more of the Regional Housing Needs Allocation (RHNA) than they can handle.

That allocation began a years-long slog to rezone for 912 units of new housing (plus a 15 percent buffer). The plan was ultimately approved by the state in 2023.

Coronado’s leaders were critical of weighted votes then, and they remained skeptical now. Duncan, Purvis, and Downey specifically said they would be uncomfortable joining a CCA that allowed for weighted voting.

The council is expected to select membership on a CCA subcommittee and to outline a proposed work plan at its June 17 meeting.

 

 



2 COMMENTS

  1. Priority should be on the Tijuana turds in our ocean and all over our beaches rather than carbon dioxide.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Megan Kitt
Megan Kitt
Megan has worked as a reporter for more than 10 years, and her work in both print and digital journalism has been published in more than 25 publications worldwide. She is also an award-winning photographer. She holds BA degrees in journalism, English literature and creative writing and an MA degree in creative writing and literature. She believes a quality news publication's purpose is to strengthen a community through informative and connective reporting.Megan is also a mother of three and a Navy spouse. After living around the world both as a journalist and as a military spouse, she immediately fell in love with San Diego and Coronado for her family's long-term home.Have news to share? Send tips, story ideas or letters to the editor to: [email protected]

More Local News