Below you will find the press release from Western Community Energy, and then if image isn't easy to read, below will be the text of the release.
POWERED BY THE COMMUNITY
3390 UNIVERSITY AVENUE, SUITE 200 | RIVERSIDE, CA 92501
FOR IMMEDIATE RELEASE: May 24, 2021
Media Contact:
Elisa Laurel
951-206-4498
elaurel@wrcog.us
www.westerncommunityenergy.com
WESTERN COMMUNITY ENERGY FILES FOR CHAPTER 9 BANKRUPTCY PROTECTION TO RESTRUCTURE ORGANIZATION’S FINANCIAL OBLIGATIONS
State mandates related to COVID-19 and increasing power costs due to state renewable energy requirements cause WCE to seek Chapter 9 Bankruptcy protection and reorganize finances.
RIVERSIDE, CA – On Monday, the Western Community Energy (WCE) Board of Directors approved a resolution declaring a fiscal emergency and authorized its legal counsel to move forward with the filing of a Chapter 9 Bankruptcy petition to allow for the restructuring of WCE’s financial obligations.
Several external contributing factors have impacted WCE’s financial situation since the program was implemented at the beginning of the COVID-19 Pandemic in April 2020.
In August 2020, California experienced an unprecedented heat event, which resulted in substantially higher power needs and a spike in the cost of energy.
Although WCE had secured 90% of its electricity needs for the summer of 2020, the heat storm exhausted the projected supplies prematurely.
An additional $12 million in energy costs were incurred throughout the 2020 summer season due to the unanticipated warm weather. Additionally, a tightening of the requirements of the State of California for Resource Adequacy (RA) created a shortage in the market, significantly increasing the cost of regulatory compliance.
Additionally, the Governor of California issued an order during the COVID-19 pandemic, implemented by the California Public Utilities Commission, mandating that no customers could be disconnected due to non-payment of their utility bills. Over the last year, delinquencies averaged ten times higher than pre-Pandemic industry standards and have cost WCE millions of dollars in added cost burden.
“The ongoing impacts of COVID-19 severely limited the organization’s options moving forward and
forced today’s action,” said Todd Rigby, Chairperson of WCE.
“Chapter 9 protection gives us the opportunity to restructure the organization and reorganize our finances. We look forward to working with our legislators, the Governor, and other parties to identify a pathway forward for WCE.”
Customers of WCE will not experience any service disruptions as a result of today’s actions and WCE will continue to keep customers updated as more information becomes available.
POWERED BY THE COMMUNITY
3390 UNIVERSITY AVENUE, SUITE 200 | RIVERSIDE, CA 92501
WCE has engaged the law firm of Weiland Golden Goodrich, LLP, to help the organization through the Chapter 9 process. Goodrich specializes in bankruptcy proceedings and has a combined 135 years of experience in managing Chapter 9 petitions.
The Chapter 9 petition has been filed with the Federal Bankruptcy Court for the Central District of California. Following the filing, WCE will proceed through the bankruptcy process to work with potential lenders, creditors and regulators to adjust WCE debt and operations and protect the interests of its customers. The process is estimated to take approximately six months.
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About Western Community Energy
Western Community Energy (WCE) is a joint powers authority, consisting of the Cities of Eastvale, Hemet, Jurupa Valley, Norco, Perris, and Wildomar, and was formed for the purpose of developing a Community Choice Aggregation (CCA) Program that purchases energy on behalf of its residents and businesses to offer a cost competitive alternative to electricity rates. A CCA provides the community choices when it comes to energy mixes and programs, while providing local control over rate setting.
Work to form WCE began in 2016, with the development of a Feasibility Study that examined the viability of moving forward with a CCA by looking at the energy markets and the costs associated with purchasing power on behalf of its customers. As a result of the findings that a CCA would be feasible, WCE was formed as a new program.
WCE aims to provide its customers:
Competitive, often lower, electricity rates
A cleaner, more efficient energy supply
Consumer choice, consumer protection, and local control over rate setting and programs
Local jobs creation and local power resiliency
Opportunities to develop future complementary energy programs such as net energy metering, energy efficiency retrofits, distributed rooftop and community solar, electric vehicle incentives and demand response technologies
New renewable power development
About Community Choice Aggregation (CCA) Programs A CCA is a model that allows communities to aggregate its power and then purchase to meet the needs of its community, offering an alternative choice in the market—often the only alternative to sourcing power from the investor owned utility (IOU). CCAs can provide the communities they serve with competitively priced, clean energy choices while reinvesting revenues into projects and programs that support the local economy.
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OPINION
Note: When I went to the WCE website at 6pm Monday, May 24th, I saw no mention of the press release.
This was first on my radar in February of 2018. Here were my take away quotes about it.
"Since there seems to be savings to the rate payers, and an easy way to opt out if things change, I can't image the point of not exploring this further."
"The thing I want to know is, if this is better than peaches and cream like it's described, then why aren't all the local cities beating a path to their door? Why the deliberation? Why does it sound like WRCOG would be sanguine if they could "amass five to six cities" when their organization has eighteen?"
It was next mentioned in February 2020. by this time, 15 months later, it's of little consequence to point out that I was less than sanguine about WCE, but there is a link to the video of the 50 minute item, plus opinions of the time at this link.
Blog Link
I don't have anymore info than you read above.
I'm not sure what to make of it at this point, but I'm a firm believer in transparency and I wanted to get this press release to the people, in an easy to read form, at the earliest point possible.
If you have questions, please use one of these options.
E: info@WesternCommunityEnergy.com
P: (866) 356-4175
• • •
An ounce of prevention is worth more than a pound of cure.
– Benjamin Franklin
Wildomar Rap hears that menudo is a great cure if you forgot to take your ounce of prevention the night before.
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