Honolulu Watches As California Cities Challenge Utility, Push Renewable Electricity
Residents of 31 cities in Southern California now have the option of getting 100 percent of their electricity from renewable sources. That feat was made possible by a California state law allowing municipalities to compete with public utilities.
It’s a concept called Community Choice Energy or Community Choice Aggregation. Both Hawaii and California share a goal of generating 100 percent renewable electricity by 2045, and the success of some California cities in meeting that goal ahead of schedule via CCA has generated some interest in Hawaii.
But Hawaii lawmakers have not provided local leaders with the same degree of flexibility as their California counterparts.
Following the 2001 bankruptcy and subsequent collapse of the energy conglomerate Enron, the California state legislature passed Bill 117, which empowered municipalities to enter into contracts for electricity, external to their publicly regulated utility company.
It took more than a decade to fully implement CCE, but as of May, residents of 31 municipalities in Los Angeles and Ventura Counties now have the option to get 100 percent of their electricity from renewable sources, predominantly solar.
Of those 31 towns and cities, 10 have set 100 percent renewable as the default option for customers.
Those local governments joined together to create the Clean Power Alliance, which now serves more than 3 million customers according to its website.
CPA independently enters into purchase agreements with electricity providers on behalf of its customers. It then distributes that electricity to area residents via the transmission lines of Southern California Edison, the region’s publicly regulated utility.
One of the CPA members is Culver City, a jurisdiction of around 40,000 people in the greater Los Angeles metro area. Culver City’s mayor, Meghan Sahli-Wells, proudly announced that as of May, her town was one of the 10 with 100 percent renewable as its default option.
Mayor Sahli-Wells believes that the creation of the Clean Power Authority has accelerated Southern California’s transition to carbon free energy by decades. Millions of residents receiving their electricity through CPA already have the option to go 100 percent renewable a full 25 years ahead of California’s statewide goal.
According to Mayor Sahli-Wells, the secret was every neoclassical economist’s favorite virtue: competition.
“What we’ve done is broken a monopoly and we’ve introduced choice where choice hasn’t existed before.”
Most public utilities are recognized as so-called “natural monopolies” and agree to strict regulation by public officials in return for market dominance. This is meant to reduce costs for the utility and prices for consumers, but the lack of competition often leads to reduced focus and investment in innovation.
Community Choice Energy aims to upend that trend by introducing a form of competitive pressure to the electricity market.
But the incumbent utility can still benefit. Southern California Edison is able to charge Clean Power Alliance for the use of its transmission lines, still generating revenue without having to produce as much power.
Culver City’s mayor predicts a future in which utilities exist as distributors of power, rather than producers.
Such a future is unlikely in Hawaii, where each county’s public utility still maintains hegemony.
But so-called Community Based Renewable Energy projects are currently in development. These utility solar projects would allow island residents who cannot install panels on their own homes, because they either rent or live in a condominium, to purchase solar-generated power.
CBRE is currently planned for all islands, with the ultimate goal of utility-scale generation.
Joshua Stanbro, head of the Honolulu Office of Climate Change, Sustainability and Resiliency, supports the idea of bringing Community Choice Energy to Hawaii. "I think this idea of community solar and the potency of community solar, allowing communities to choose 100 percent renewable if they can get those projects located on the grid, is really powerful as well."
He said Hawaii has a program like Community Choice Energy that is in its initial stages, but Stanbro said it needs to be expedited.
Hawaii public utilities are also developing projects on all islands that would allow some residents who can't install their own panels to access solar-generated power.