Ava Returns Funds Through Bill Credits and Programs

A solid financial picture for the agency results in a new round of bill credits to customers, as well as a new solar and storage program, and stronger operating reserves.

As the cost of living in California continues to rise,  Ava is doing its part to cut utility costs for its customers. Another round of bill credits will add to the substantial savings already delivered by rates that are lower than PG&E’s for most customers.

Between lower rates and bill credits, Ava has saved customers over $140 million on their bills since 2018. Those funds would have gone to PG&E otherwise.

In the most recent annual true-up, Ava’s careful budgeting, combined with California’s constantly fluctuating energy markets, has led to revenues exceeding operating expenses for fiscal year 2023-24, about 4.4% higher than previously forecast.

At its November meeting, Ava’s Board allocated those excess funds to cut customer bills through a bill credit, build up operating reserves, and to boost local resilience programs. A strong operating reserve boosts Ava’s credit rating, lowers borrowing costs, and helps the agency get through any operating shortfalls.

“Our operating financials are looking very healthy, so we are able to return some funds to customers to help with energy affordability, as well as invest in our community programs while working towards our operating reserve goals. It’s a win-win-win for customers, the community, and Ava,” says Howard Chang, CEO of Ava Community Energy.

Last year, Ava’s Board approved allocating a portion of the expected budget surplus for working capital needs and reserve funds, and the remaining balance split 60/40 between a one-time on-bill credit to customers and incentives for an Ava Solar and Storage Program.

Now with year-end numbers in, revenues were above operating and reserve expenses, leaving Ava with an additional $37.4 million to allocate back to the community. 

At the November 20, 2024 meeting, the Board agreed to use $22.4 million to fund a one-time bill credit of $100 for the 108,000 customers on the California Alternate Rates for Energy (CARE) and Family Electric Rate Assistance (FERA) rate discount plans, $8.82 for all other residential customers, and 0.21 cents per kilowatt-hour used over the past year for non-residential customers. 

“As a not-for-profit public agency, Ava is proud to return excess revenue to our customers,” said Chang. “Our credits and savings program enables us to continue bringing clean, reliable and affordable energy to the communities we serve.”

This year’s bill credit is larger than was paid out in December 2023, when Ava returned $10.5 million to customers ” All residential customers got $7.27 each, CARE and FERA customers got an additional $50 credit, and commercial customers got 0.2 cents per kWh.

To ensure Ava is meeting customer needs, the staff surveyed 700 CARE customers about how they would like to receive the credit. CARE customers agreed they liked getting it in one lump sum, especially during the winter months when utility bills are highest.

The rest of this year’s surplus, about $15 million, will provide funding for a new Solar and Storage Incentive Program to be rolled out in 2025.

Part of those funds will go toward building “resilience hubs,” which are facilities that provide community support during emergencies. Ava is working in consultation with community members to identify potential locations, provide technical assistance, and provide incentives for solar and storage equipment. 

The Ava bill credit is on top of other savings and discounts Ava is providing. First and foremost is that Ava’s basic product, Bright Choice, is priced at 5% lower than PG&E’s rates.  Last year alone Bright Choice delivered $33.1 million in savings to Ava customers. 

Combined with periodic bill credits, Ava has saved customers over $140 million on their bills since 2018.

For low-income households, Ava has helped eligible customers sign up for the CARE, FERA, and Medical Baseline discount programs. CARE offers a 30-35% discount on electric bills and a 20% discount on natural gas bills. FERA offers an 18% discount on electricity bills for qualified households of three or more people. Medical Baseline offers a discount for a set amount of gas and electricity each month charged to customers with serious medical conditions and/or powered medical equipment.

In addition, Ava has enrolled about 3,000 customers in the Ava Auto-Enrolled Solar Discount program under the state’s Disadvantaged Communities Green Tariff (DAC-GT) program, which provides customers with a 20% bill discount. Ava has contracted for five community solar projects on the roofs of Prologis warehouses. The projects are slated to come online in 2026, and will supply enough energy to support about 3,900 households.

Lastly, all Ava customers get the California Climate Credit twice a year via PG&E. Funds for the Climate Credit come from the state’s Cap-and-Trade Program that requires polluters to pay for climate pollution.

The Climate Credit amount is fixed per customer, regardless of consumption and household income. Residential electric customers got $110.34 while natural gas accounts got $85.46 in 2024 (or $195.80 total), while small business customers got $110.34. This is a significant jump from a total credit value of $131 in 2023, due to higher cap and trade prices.