Apple Valley Adopts Plan to Become Electric Provider

APPLE VALLEY — The Town Council voted Tuesday to adopt the implementation plan for the Apple Valley Choice Energy Program, a move the leads the town a step closer to becoming residents’ default electricity provider.

A summary of the Community Choice Aggregation program startup and phase-in process projects total revenues for the town of nearly $13.2 million while total costs and operating reserves would stand at approximately $12.1 million upon implementation in 2017. Both amounts incrementally increase from there until 2026.

A nine-year surplus of just over $21 million is projected at that point, the summary shows.

Prior to the unanimous vote, Mayor Barb Stanton acknowledged that serving as the community’s electricity provider will be a revenue generator for the town, but she discussed overall benefits, as well.

“It’ll help our citizens and it will help the town,” Stanton said. “In Apple Valley we aren’t along the freeway corridor. We don’t have Restaurant Row or the hotels. We are looking and growing in a little and distinctively different way than our neighbors, and I applaud that growth. That’s what makes Apple Valley special … We all want (the program) to be everything that it’s positioned to be, and I also think we’re making the right move.”

More concretely, Mayor Pro Tem Scott Nassif and Councilman Art Bishop said local control of utility distribution will lower rates for customers within the town’s service area — compared to the rates of Southern California Edison — and provide an incentive to businesses weighing the pros and cons of moving into Apple Valley.

In addition, Public Services Manager Joseph Moon told the Daily Press the town is soliciting proposals from a variety of suppliers, which does not include SCE.

“By purchasing power directly through the market, we can pass it on at lower rates,” Moon said via email. “We are currently reviewing responses to our first request for bids.”

Bishop characterized the current state of utility costs in California as “going crazy.”

“I see this as a direct benefit not only today but tomorrow,” Bishop said. “Looking at what the CPUC is doing to the people in California, I think this is the way of the future for every local community in the state.”

Nassif discussed the additional benefit to residents of being able to address Council directly on electricity-related issues, which other Council members have previously stated would also be a benefit of local control of the water system currently owned by Liberty Utilities, Apple Valley.

“It brings back the opportunity for our residents to come to Council meetings and talk to us about rates, talk to us about programs,” Nassif said. “I think there is a benefit, both to our residents and, of course, to our businesses if we want to … structure it to attract businesses in our community moving forward.”

Town officials maintain in documents that the program will create jobs, as well.

Several residents, however, were skeptical of the Council’s move. Lawrence McCarthy asked for clarification on the inclusion of a deposit required prior to obtaining service.

Town Manager Frank Robinson then clarified — somewhat aggravatedly — that the deposit will not be required of all customers in the service area, but by some customers who were previously customers of SCE or AVCE and had their service discontinued within the last 12 months as a result of bill nonpayment.

“That is a standard process in utility services,” Robinson said. “We all know that. In fact, many of us who may be new to the state of California in the past, or have been new to living on your own for the first time and turning on a utility, are asked to put up a deposit until you establish your credit worthiness.”

Following McCarthy’s question, fellow resident Richard Rorex took exception to the opt out aspect of the program, which is allowed at no cost to customers during the rollout process.

“If this is such a great thing for us, why is it opt out instead of opt in?” Rorex asked. “Every contract that has opt out is usually bad for the customer. Really. They want to force you into it unless you decide not to … This opt out thing really rankles my soul because it’s never been to the advantage of the consumer. Now, if it’s such a great thing, it should be opt in and people should be flocking to it.”

Rorex added that the process for opting out of the program was too complicated and questioned whether AVCE would truly be beneficial to consumers.

Moon said Thursday that four notifications will be sent to customers during the program’s enrollment period, which will include information related to opt-out rights.

Documents show that all customers who do not opt out within 30 days of the fourth enrollment notice will have agreed to become full status program participants.

The town is now expected to submit its AVCE implementation plan to the California Public Utilities Commission for review. It’s then the CPUC’s responsibility to establish a cost-recovery mechanism that must be in place before customers receive service through AVCE, according to the California Public Utilities Code.

Apple Valley Adopts Plan to Become Electric Provider, by Matthew Cabe, Victorville Daily Press, August 12, 2016.

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