Consent Item 6
Consent Item 6
To: Ava Community Energy Authority
From: Kelly Brezovec, Sr Director of Account Services
Subject:
Adopting a Resolution to Remove Customer Opt-out Fees
Date: December 17, 2025
__________________________________________________________________ Summary/Recommendation
Adopt a Resolution eliminating the customer opt-out fee of $5 for residential customer accounts and $25 for non-residential customer accounts. The opt-out fee does not appear to deter customers from opting out of Ava service and may create customer confusion or distrust in the Agency.
Financial Impact
Removing the opt-out fee will have a negligible impact on Ava’s finances.
Ava has a 95% participation rate, meaning few customers opt out of Ava service. Cumulatively, 60,000 customers have opted out. Of these customers that do depart, we have only collected opt out fees from 15,500 residential customers and 640 non-residential customers. The majority of opt outs happen during the first year of service to a new community, when Ava has historically waived the opt-out fee.
In the past seven years of service, Ava has collected less than $95,000 in opt-out fees, about $14,000 annually. Ava has waived approximately $5,000 in opt out fees.
Consent Item 6
If the Board adopts the Resolution to remove the opt-out fee, staff will work with Ava’s billing agent, Sacramento Municipal Utility District (“SMUD”), to update the automated billing operations, which will cost less than $8,000. Staff will also remove references to the opt out fee from webforms, emails, and interactive voice recordings, as part of regular work to maintain these services.
Analysis and Context
The opt-out fee was adopted at the February 21, 2018 Board of Directors meeting, as part of the Item - Approval of the Terms and Conditions of Service. The customer Terms and Conditions of Service have been subsequently updated to reflect changes in the service plans, value proposition, and communities served by the Agency. Should the Board adopt this Resolution, staff will make appropriate edits to the Terms and Conditions of Service and the Service Terms and Conditions section of the website to remove references to opt-out fees.
Ava implemented the opt-out fee starting in 2019. The fee is clearly stated in all methods of customer interaction (phone, automated voice, and webform) and in our Service Terms and Conditions on our website. When a customer opts out of Ava service, the fee is applied to their final bill. Ava waives the opt-out fee for customers who opt-out of Ava service within the first 60- days of service or within the first 12-months of service to a new community.
Based on customer interactions with Ava’s customer support center, there is no clear evidence that an opt out fee of $5 to residential customers or $25 to non-residential customers (per meter) helps deter opt outs nor aids customer retention. On the contrary, staff believes that customers’ distrust and frustration over opt-out fees may be harming customers’ perception of the agency and, in some cases, may encourage opt-outs.
During the April 2025 enrollment of Stockton and Lathrop, staff found multiple social media posts from residents that encouraged their peers to opt-out of Ava service, citing the opt-out fee both as a reason to leave Ava service early and as an indicator that Ava is a “scam.” Removing the opt out fee may help alleviate these customer concerns.
Moreover, there are more effective and meaningful ways to retain customers than through an opt-out fee. Ava’s customer service representatives provide the best means of deterring opt-outs. In 2021, staff began tracking how many customers opt-out after speaking with a customer service representative and found that over 7,640 customers who had planned to opt-out chose to stay with Ava after having a conversation with a representative.
While staff does not have a means of verifying if the opt-out fee is a key factor in the decision to opt out of Ava service, it is possible that removing the fee entirely may encourage customers to try Ava service for a number of months, during which time the customer may learn about Ava’s benefits and choose to stay.
Consent Item 6
Comparison to other CCAs
When Ava implemented its opt-out fee assessment in 2019, it was a common practice among Community Choice Aggregators (“CCA”). Today, CCA policy is split. Six CCAs do not assess an opt-out fee. Five CCAs follow the same policy as Ava. One Bay Area CCA does not assess a fee for the entire first year of service. Of the CCAs that do assess fees, the amounts are consistent with Ava’s current policy of $5 for residential and $25 per meter for non-residential customers.
Committee Recommendation
The Executive Committee reviewed this item at their meeting on Wednesday, December 3, 2025. The Executive Committee supported the staff recommendation to remove the customer opt-out fee provision, citing the potential harm to the Ava Brand and minimal impact on finances.
The Executive Committee supported Staff’s proposal to update both operations and the customer Terms and Conditions in advance of enrolling customers in unincorporated San Joaquin County to facilitate a positive customer experience.
Attachment Consent Item 6A
RESOLUTION NO.
A RESOLUTION OF THE BOARD OF DIRECTORS
OF AVA COMMUNITY ENERGY AUTHORITY ON REMOVING CUSTOMER
OPT-OUT FEES FOR AVA SERVICE
WHEREAS, Ava Community Energy Authority (“Ava”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, under the Joint Exercise of Powers Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of Ava and parties to the Joint Powers Agreement (“JPA”) in March of 2020. The city of Stockton was added as a member to Ava in September of 2022. The city of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024. On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception; and WHEREAS, on February 21, 2018, the Board of Directors (the “Board”) approved Ava’s initial set of customer Terms and Conditions of Service that included an opt-out fee; and
WHEREAS, the customer Terms and Conditions of Service have been subsequently updated to include changes to the value proposition, jurisdictions served, and service plans; and
WHEREAS, staff has identified that the opt-out fee is no longer beneficial to the agency and may encourage early opt-outs.
NOW, THEREFORE, THE BOARD OF DIRECTORS OF AVA COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:
Section 1. The Board hereby directs staff to discontinue the practice of assessing an opt-out fee, effective with this Resolution.
Section 2. Staff is hereby authorized, in consultation with Ava legal counsel, to update Ava’s Terms and Conditions of Service and take all other actions necessary to effect this revision.
ADOPTED AND APPROVED this 17th day of December 2025.
Attachment Consent Item 6A
Betsy Andersen, Chair
ATTEST:
Adrian Bankhead, Clerk of the Board