Trystan Casey
If you live in a municipality that participates in a CCE program (Community Choice Energy), then all energy customers are automatically opted into the program. In this case, the 3rd Party is your actual electric power used, as generated by another company, and the PG&E charge is for distribution only. You can choose to have your power generated by PG&E, but it’s not always going to be cheaper. More than 50% of PG&E’s customers buy their electricity from a third party called a CCA. PG&E also offers demand response programs designed to enable customers to contribute to energy load reduction during times of peak demand. Contracted third parties offer programs for customers to save or earn money by adjusting energy usage.
| Characteristics | Values |
|---|---|
| What is 3rd-party electric in PGE? | The 3rd Party is the actual electric power used, as generated by another company. For example, East Bay Community Energy. PG&E's charge is for distribution only. |
| Who does it apply to? | More than 50% of PG&E's customers buy their electricity from a third party called a CCA. |
| How does it work? | Customers on a Community Choice Energy Aggregator (CCA) service like East Bay Community Energy (EBCE) will see the charge and also receive a monthly bill credit from PG&E (called the Generation Credit) that offsets the EBCE charges. |
| How does it compare to PG&E's rates? | EBCE rates for Bright Choice service (what most customers receive) are 1% below PG&E rates, but the EBCE Board voted to make the discount 3%. |
| Are there other benefits? | Third-party providers may provide incentives at their discretion. For example, the SmartAC switch remotely shifts energy use to off-peak hours. |
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What You'll Learn
PG&E customers can buy electricity from third parties
For example, East Bay Community Energy (EBCE) is a CCA that offers rates 1% below PG&E's, but the EBCE Board recently voted to increase this discount to 3% below PG&E rates. Customers can opt-out of their CCA and choose to have their power generated by PG&E, though this may not be cheaper.
CCAs allow cities and counties to provide other energy options to their residents and businesses. They are particularly popular among those who want to support more environmentally-friendly sources of power generation.
PG&E also offers third-party demand response programs, where customers can earn incentives by reducing their electricity use during peak demand periods. These programs help to balance the electric grid without producing emissions and are offered by third-party demand response providers.
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Third parties generate electricity, PG&E distributes it
In California, more than 50% of PG&E’s customers buy their electricity from a third party called a CCA (Community Choice Energy Aggregator). This means that while the electricity is generated by another company, PG&E is still responsible for distributing it to customers' homes.
If you live in a municipality that participates in a CCE program, all energy customers are automatically opted into the program. However, as a consumer, you can choose to opt out and have PG&E generate your electricity instead. The cost difference between the two options is usually negligible, with the primary difference being that CCAs support more environmentally-friendly sources of power generation.
Customers on a CCA service will receive a monthly bill credit from PG&E (called the Generation Credit) that offsets the CCA charges. For example, East Bay Community Energy (EBCE) rates for Bright Choice service are 1% below PG&E rates, but the EBCE Board recently voted to increase this discount to 3%.
PG&E also offers various demand response programs designed to enable customers to contribute to energy load reduction during times of peak demand. These programs are often provided by third-party providers and offer financial incentives for customers who adjust their energy usage. For instance, the SmartAC switch remotely shifts energy use to off-peak hours, and the WaterSaver program heats water at the least expensive times of the day.
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Customers can opt-out of third-party electricity
Customers can opt out of third-party electricity. If you live in a municipality that participates in a Community Choice Energy (CCE) program, all energy customers are automatically opted into the program. However, you can choose to opt out and have PG&E generate your electricity. The cost difference between the two options is negligible, with the CCE option being about 1-3% cheaper, but it supports more environmentally friendly sources of power generation.
When power was deregulated in California, the big three utilities were required to sell off their generating stations, and now more than 50% of PG&E's customers buy their electricity from a third party called a CCA. If you see another company's name on your bill, you are buying electricity from them and paying PG&E to transport it to your home. PG&E sends one combined bill.
If you are enrolled in a CCA service, you will also receive a monthly bill credit from PG&E (called the Generation Credit) that completely offsets the CCA charges. For example, East Bay Community Energy (EBCE) rates for Bright Choice service are 1% below PG&E rates, but the discount will increase to 3%.
PG&E also offers various demand response programs that provide incentives for customers to reduce their electricity usage during peak demand periods. These programs are designed to help balance the electric grid and conserve energy. Customers can participate in these programs through third-party providers, who may offer additional incentives at their discretion.
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Third parties offer demand response programs
PG&E customers can choose to receive their electricity from third-party providers, rather than from PG&E. These third-party providers are independent or contract with PG&E.
Third-party demand response programs offer incentives for customers to reduce their electricity use during times of high demand. For example, businesses can opt for Peak Day Pricing, which offers a discount on regular summer electricity rates in exchange for higher prices on Peak Day Pricing Event Days. There are typically 9-15 of these days each year, during the hottest days of summer. By reducing electricity use on these days, businesses can save money and help keep California's energy supply reliable for everyone.
Another example of a third-party demand response program is the Emergency Load Reduction Program (ELRP). This is a seven-year pilot program that offers financial incentives for participating businesses to reduce their energy use during times of high grid stress and emergencies. The goal is to avoid rotating outages while minimizing costs to customers.
Customers can also enroll with a third-party aggregator directly. An aggregator is an entity appointed by a customer to act on their behalf with respect to all aspects of CBP, including the receipt of incentive payments and payment of penalties.
Third-party demand response programs are a fiscally and environmentally responsible way to respond to peak demand periods. By participating in these programs, customers can help enhance electricity reliability in California.
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Third parties may provide incentives for demand response programs
In the context of PGE (Pacific Gas and Electric), 3rd-party electric refers to electricity generated by a company other than PGE. For instance, East Bay Community Energy is a 3rd-party electric company. Customers on a Community Choice Energy Aggregator (CCA) service are charged for their electricity usage by the 3rd-party company, but they also receive a monthly bill credit from PGE (called the Generation Credit) that offsets the charges from the 3rd-party company.
Demand response refers to balancing the demand on power grids by encouraging customers to shift electricity demand to times when electricity is more plentiful or demand is lower. This is typically achieved through price-based programs or incentive-based programs. Demand response programs are important for managing the impact of variable renewables and growing electricity demand on the stability and reliability of electricity grids.
In addition to monetary incentives, clear communication and education can also promote the active participation of consumers in demand response programs. Governments should also provide incentives to consumers in the form of rewards or clear guidelines and information. For instance, smart metering can provide real-time pricing for all types of users, giving them a direct incentive to reduce their electricity use during high-demand, high-price periods.
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Frequently asked questions
Third-party electric in PGE refers to when customers buy their electricity from a company other than PGE, known as a CCA. However, they still pay PG&E to distribute that electricity to their homes.
If you see another company's name on your bill, you are buying electricity from them.
Customers who buy electricity from a CCA often do so to support more environmentally-friendly sources of power generation.
You can opt out of your municipality's CCE program and choose to have your power generated by PG&E.
There are third-party demand response programs that offer incentives to customers for reducing their electricity use when demand is greater than supply.
