California's Community Choice Aggregation Act [AB 117] looks like it may have been TOO good an idea.  Following on the heels of San Francisco and Marin issuing RFP's for community power, there is now a proposed ballot initiative that would change the power customer opt-out provision to basically an opt-in provision.  This makes quantifying the rate base asset much more difficult.  And if you ain't got the rate base, you got nothin'.

No word yet about how the SFPUC and the Marin Energy Authority are planning to handle this initiative--called the Taxpayer Right to Vote initiative but what should really be called the CCA Killer ballot initiative.

Follow the math, and you can understand how much this means to California's investor owned utilities.  PG&E, as one example, has about $1B in annual ratebase revenue.  San Francisco's CCA would have ripped about $200M in ratebase, and Marin would have pulled another $80M.  This represents a 30% reduction in PG&E revenues in 2010--a change from forecasts in 2006:

"In its medium case, PG&E assumed that 3% of its customers would begin to migrate to community choice aggregation in 2006 and the rate of loss to this market will increase by 1% annually, reaching 10% in 2013."[p 26]

A $240M delta in 2010.  So you can see why the money spent putting together the Taxpayer Right to Vote Act looks like a really good investment.  Efforts to defeat this initiative look insufficient at this point.

As a solar developer, a CCA is a great customer, typically with higher demand for renewables--Marin is planning on offering a 100% renewable program for customers.  More customers means more demand for clean renewable power.  Is this initiative bad news?  There is an interesting carveout in the initiative:

"This section shall not apply to any bonded or other indebtedness or liability or use of public funds that...is solely for the purpose of purchasing, providing, or supplying renewable electricity from...photovoltaic...[or other renewables].

This carveout sounds like it preserves the property assessed energy district financing that is a real innovation, but will it save a CCA if it is sourcing 100% renewable power?  Does this work if you are on the utility side of the meter? Looks like we stay on the customer side of the meter, and compete against retail power rates.  Or we focus on the feed in tariffs working their way through the CPUC and the legislature.

I will vote against this initiative if it makes it to the ballot this fall--the issue is about communities having the right to "own" their ratebase assets instead of the investor owned utility, not about taxpayers and right to vote. 

A close reading also leads me to conclude that it stops any municipally owned utility [MOU] from raising any additional capital or expanding their service territory without a 2/3 majority vote at the ballot box--a very tough restriction in a capital intensive industry.  No capital to establish or expand electric delivery service without first winning a 2/3 majority at the ballot box--this is going to slowly strangle a lot of MOU's. 

Competition in power is a good thing--and this initiative cripples competition because it locks in the rate base with the IOU.