Staff Report Item 9
Staff Report Item 9:
To: Ava Community Energy Authority Executive Committee
From: Alex DiGiorgio, Sr. Manager, Public Engagement
Subject: Seeking feedback from the Executive Committee regarding the 2026 enrollment process for customers in unincorporated San Joaquin County Date: May 7, 2025
__________________________________________________________________ Summary/Recommendation
This memo proposes to inform the Executive Committee about the start of Ava service to unincorporated San Joaquin County in March of 2026 and to highlight key considerations supporting this enrollment timeline.
Analysis and Context
On December 20, 2024, the California Public Utilities Commission (CPUC) certified Ava’s Implementation Plan Addendum #4 (IPA4) to begin service to unincorporated San Joaquin County (SJC) in 2026. Per the CPUC’s certification, the earliest Ava may begin serving SJC customers is January of that year. Apart from this condition, CPUC precedent allows community choice aggregators (CCAs), like Ava, broad discretion when it comes to the timing and implementation of service to a new jurisdiction.
For example, Ava’s initial launch of service to Alameda County jurisdictions occurred in phases by customer type (e.g., residential vs commercial) over the course of 2018. Subsequent enrollments (i.e., those for the cities of Tracy, Pleasanton, and Newark in 2021; and for Stockton and Lathrop in 2025) all occurred during April of the year corresponding to the CPUC’s certification of Ava’s previous Implementation Plan addendums.
As discussed in more detail below, Ava staff have identified March as the optimal 2026 enrollment month for customers in SJC.
Staff Report Item 9
When determining the timing, sequence, and implementation of an initial customer enrollment, Ava staff primarily evaluate three criteria: 1) financial impacts; 2) operational efficiency; and 3) overall customer experience. These are discussed in more detail below.
Financial Impacts
To help ensure Ava provides competitive rates to both new and existing customers, staff continuously analyzes the dynamics between retail rates and wholesale power prices.
Consequently, staff aims to enroll new communities during historically lower cost months of the year. This allows Ava to maximize net revenues while minimizing costs to customers.
Based on historical usage data, electricity costs are typically the lowest from February to April.
While energy prices are generally higher during winter months, by March solar and hydroelectric resources are usually abundant, which helps to reduce costs. By late Spring and early Summer, however, customer usage tends to increase as temperatures rise (e.g., due to increased air conditioning); and increased solar output does not align with peak demand, which typically occurs in the early evening hours. As such, staff has identified March as the optimal month for SJC’s enrollment, particularly given the additional considerations discussed below regarding Ava operations and overall customer experience.
Regarding Ava's separate energy capacity obligations (i.e., compliance with the CPUC’s Resource Adequacy/“RA” requirements), March also works well for SJC’s enrollment. This is largely due to the timing of the RA procurement cycle, which occurs on a calendar year basis.
As such, increasing load during the first half of the calendar year does not increase RA costs; it utilizes the RA that has already been procured.
In short, a March enrollment capitalizes on historically lower energy costs without increasing Ava’s near-term RA obligations.
Operational Efficiency
Operational considerations related to Ava’s new community enrollments primarily involve 1) the development and sequencing of required customer notifications; 2) call center coordination and web-based functionality for customer options (i.e., ‘opt outs’ and voluntary Renewable 100 enrollments); and 3) community outreach planning.
Per CPUC rules, Ava is required to send at least two enrollment notices to all eligible customers before their transition to Ava service (as well as two more afterwards). The first two notices are sent to customers during the immediate two months prior to enrollment according to each customer’s billing date. By enrolling in March, Ava will send these notices in January and February of 2026—avoiding the holiday season. This timing would help ensure more customers see their notices, rather than lose track of them during the holidays.
Staff Report Item 9
Similarly, Ava’s marketing and community outreach activities would largely occur after the holidays (i.e., ramping up in January 2026), which would likewise help ensure they meaningfully inform customers about the transition to Ava service. This outreach typically involves a multi-media advertising campaign, as well as participation with local community groups and events.
By focusing on these activities after the holidays (i.e., Jan-April 2026), Ava staff will more effectively engage members of the public and inform them of their new energy options.
Customer Experience
In addition to maintaining competitive rates and increasing the likelihood of successful community outreach, March also provides optimal enrollment timing from a customer-oriented perspective.
Unsurprisingly, Ava’s ‘value proposition’ to customers (i.e., Bright Choice rates that are lower than PG&E’s rates, and Renewable 100 rates that are only slightly higher) is one of the primary reasons communities pursue Ava service in the first place. By enrolling earlier in the year, Ava’s new customers will be able to reap the benefits of Ava’s service sooner. This also includes access to Ava’s customer programs, such as Ava SmartHome Charging for electric vehicles and Ava Bike Electric, an e-bike discount program.
Additionally, by enrolling in March when weather tends to be milder and energy usage tends to be lower, customers are less likely to experience high energy bills and attribute these to Ava service.
South San Joaquin Irrigation District (SSJID): Recommendation to defer enrolling customers within SSJID’s service area to provide time for inter-agency negotiations As Ava prepares to begin service to SJC in 2026, a novel issue has surfaced which will require direction from the Board regarding the enrollment status of approximately 7,000 customers, roughly 10-12% of all eligible SJC accounts located within the overlapping service areas of Ava and SSJID.
For context, SSJID has been seeking to expand its services to include municipal electric service (e.g., similar to Alameda Municipal Power or Sacramento Municipal Utility District) via an eminent domain proceeding of PG&E's local infrastructure. This effort has been twenty years in the making and has slowly made progress—although the timeline and ultimate outcome remain uncertain.
The vast majority of SSJID's service area, customer base, and prospective electric load are located within the cities of Manteca, Ripon, and Escalon—none of which are included within Ava's expanding service area. However, SSJID also serves a swath of unincorporated San Joaquin County which is now preparing to begin service with Ava in 2026. As noted above, this overlap involves approximately 7,000 customers with a corresponding load of about 100 Gigawatt-hours per year (roughly 1.3% of Ava's total, forecasted load for 2026).
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Figure 1: SSJID territory
The question for Ava’s Board to consider: How should Ava proceed with the enrollment of unincorporated SJC, while mitigating the potential cost of SSJID customers departing Ava service if/when SSJID acquires PG&E's infrastructure and begins its electric utility service?
According to SSJID staff and related CPUC filings, SSJID is scheduled to begin litigating the acquisition of PG&E’s infrastructure via eminent domain in June 2025. It is unknown how long this process will take or what the final outcome of it will be. Ava staff have been unable to find any recent examples (i.e., within the last fifty years) of a successful eminent domain proceeding against PG&E to create a municipal utility.
To be clear, Ava’s goal is not to interfere with SSJID's municipalization endeavor; it is simply to serve eligible SJC customers, while exploring risk mitigation strategies that best serve all of Ava's customers and communities. Accordingly, Ava has no intention of retaining customers within SSJID’s service area if/when SSJID acquires PG&E’s infrastructure and launches its municipal utility service.
As such, Ava staff recommends the Board approve the following action: Defer the enrollment of eligible, overlapping Ava/SSJID customers, while Ava and SSJID negotiate risk mitigation strategies for temporary-but-indefinite Ava service and to allow the June Staff Report Item 9
2025 eminent domain proceeding to begin.
To date, Ava staff have held several meetings with SSJID staff and have broadly discussed how Ava might temporarily serve SSJID customers. While Ava and SSJID staff have been unable to resolve how the two agencies would share and mitigate financial risks associated with temporary-but-indefinite Ava service, they will continue to hold more meetings to explore such possibilities.
Ava staff members have also met with San Joaquin County’s Chief Administrator and staff. All parties have expressed a shared desire to avoid undermining SSJID municipalization efforts, while acknowledging Ava’s need to mitigate any financial risks created by temporarily serving customers who may eventually depart when SSJID launches municipal utility service.
Staff recommends Ava defer the enrollment of SSJID customers. Staff and SSJID will attempt to develop a risk-mitigation strategy to allow for temporary Ava service; a deferral will also provide time to understand how and when the eminent domain proceeding may conclude.
Risks vs. benefits of deferring the enrollment of SSJID customers There are risks and benefits associated with deferring the enrollment of overlapping Ava/SSJID customers. These are summarized in the table below:
Risks Benefits
• Equity: These ~7,000 customers
would not have access to Ava’s Bright
Choice rate discount, bill credits,
programs, Solar Billing Plan adders,
etc., unless or until Ava enrolls them
at a later, undetermined time.
• Financial: Ava would forfeit revenues
generated by serving these
customers; and would be doing so
indefinitely unless the Board sets a
deadline for an agreement and/or
future date for enrollment regardless
of the progress made negotiating with
SSJID. Meanwhile, there would be
new operational costs involved with
developing and implementing novel
electronic and administrative
processes to defer SSJID customer
enrollments.
• Equity: If/when SSJID customers
begin municipal utility service
w/SSJID, they could ultimately benefit
from a larger rate discount than what
Ava currently offers through its Bright
Choice option. SSJID estimates a
15% savings on the overall PG&E
electric bill.
• Financial: Ava could avoid the risk of
over procuring power if/when SSJID
customers depart for municipal utility
service following SSJID’s successful
eminent domain proceeding to
purchase PG&E’s infrastructure.
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• Political: Customers within SSJID’s
service area may express frustration
at not having access to Ava service.
• Operations: Ava has not managed a
deferred enrollment based on
geography within municipal
boundaries; there may be fees and
complications associated with
managing a separate customer group
within the County.
Financial Impact
As discussed above, the financial impact of Ava enrolling SJC customers in March 2026 will optimize revenue generation relative to the cost of service, while also considering non-financial factors.
Regarding SSJID’s service area: There is financial risk involved with serving customers that may ultimately depart Ava’s service area for separate municipal utility service. This risk is largely due to the potential over-procurement of wholesale power when temporarily serving a subset of customers. While it is possible Ava could sell any excess power on the market for a profit, it is also possible this power would have to be sold at a loss compared to its purchase price. This would depend on the market environment at the time these transactions occur.
Due to the uncertainty around SSJID’s municipalization effort (i.e., its likelihood of success and timing of service, if successful), it is difficult to quantify the specific financial risk. The scope of the risk, however, would be limited to the size of the departing load.
As referenced above, based on PG&E’s 2023 load data, the amount of departing load SSJID represents is approximately 100 GWh annually. Meanwhile, Ava’s current 2025 load forecast is approximately 7,600 GWh (including service to the cities of Stockton and Lathrop); and Ava’s 2026 load forecast is approximately 8,800 GWh (including service to unincorporated San Joaquin County). As such, SSJID’s potential departing load amounts to roughly 1.1% to 1.3% of Ava total projected load. While this is a relatively small amount, it could still represent millions of dollars in surplus wholesale energy costs. Actual costs, of course, will depend on market conditions at the time of any future transactions that result from SSJID’s departing load—the timing of which remains uncertain.
Should the Board direct Ava to defer service to the overlapping Ava/SSJID customers, staff anticipates some ongoing expenses associated with correctly dispositioning the Ava enrollment status of meters within SSJID’s portion of San Joaquin County. Similarly, Ava would not collect revenue from these customers for the duration of their deferral. Meanwhile, as Ava proceeds with launching service to SJC customers in March of 2026, Ava staff would continue to engage Staff Report Item 9
with SSJID staff to negotiate risk mitigation strategies that would allow Ava to eventually enroll SSJID customers and serve them until SSJID begins its municipal utility service.
Recommendation
Ava staff proposes the Executive Committee receive staff’s recommendation to enroll SJC customers in March of 2026 and consider deferring service to customers within SSJID service area pending the outcome of SSJID’s eminent domain proceeding before the CPUC on June 23, 2025.
Attachments
A. Power Point Presentation (PPT)
Ava Executive Committee:
2026 Unincorporated San
Joaquin County enrollment
Attachment Staff Report Item 9A
1. Update: 2026 unincorporated SJC
enrollment
2 2. South San Joaquin Irrigation
District (SSJID) enrollment status
recommendation
Attachment Staff Report Item 9A
1. Update: 2026 unincorporated SJC
enrollment
3 Attachment Staff Report Item 9A
Unincorporated SJC enrollment: March 2026
Key considerations re enrollment month:
1. Financial impact
2. Operational efficiency
3. Overall customer experience
4 Attachment Staff Report Item 9A
Unincorporated SJC enrollment: March 2026
Key considerations re enrollment month:
1. Financial impact
o Historically, wholesale energy costs are relatively
lower (e.g., solar and hydro resources are
becoming more abundant)
o Customer usage is relatively low due to seasonally
temperate climate
o Enrolling earlier in year (Q1 or Q2) = more revenue
o Resource Adequacy (RA) already procured
5 Attachment Staff Report Item 9A
Unincorporated SJC enrollment: March 2026
Key considerations re enrollment month:
2. Operational efficiency
o Legally required customer notification begin in
January/New Year (two months prior to
enrollment)
o Call center coordination avoids holidays
o Community outreach events/activities ramp up
after holiday season
6 Attachment Staff Report Item 9A
Unincorporated SJC enrollment: March 2026
Key considerations re enrollment month:
3. Overall customer experience
o Earlier access to Ava service options (Bright
Choice & Renewable 100) and programs
o Historically temperate weather month + lower
usage = less likely to experience high bills
o Ava outreach activities more likely to reach
customers/communities
7 Attachment Staff Report Item 9A
8 2. South San Joaquin Irrigation
District (SSJID) enrollment status
recommendation
Attachment Staff Report Item 9A
SSJID: Background
9 o Began pursuing municipal utility (electric) service 20+ years ago o Scheduled to begin litigating eminent domain acquisition of local PG&E infrastructure in June 2025
o Includes 7,000 customers/100 GWh/year in unincorporated SJC (approx 10-12% of all eligible accounts/load in unincorporated SJC) o Represents ~1.3% of Ava's forecasted 2026 load
Attachment Staff Report Item 9A
SSJID: Recommend deferring customer enrollment
10 Recommendation to Ava Board:
Defer enrollment of SSJID
customers to allow:
▪ Ava/SSJID staff explore
risk mitigation strategy for
temporary-but-indefinite
Ava service, and
▪ Time to understand how
and when the eminent
domain proceeding may
conclude
Attachment Staff Report Item 9A
Attachment Staff Report Item 9A