Direct Access Background

Before the Energy Crisis

As a part of the deregulation of California’s electric industry in 1998, SDG&E implemented a program referred to as Direct Access (DA).  The DA program offered all customers the option to begin purchasing their electric commodity services from a third-party Energy Service Provider (ESP) instead of continuing to receive these services from SDG&E. 

After the Energy Crisis

Legislation enacted as a result of the 2000-2001 energy crises in California required the suspension of DA.  In a decision issued by the California Public Utilities Commission (CPUC) on September 20, 2001, the CPUC adopted rules that suspended the rights of new customers to purchase electricity from an ESP.  Although no new customers were permitted to switch to DA, customers with existing DA contracts could remain on DA.        

Limited Re-opening of Direct Access

On October 11, 2009, a new law, Senate Bill (SB) 695, was signed by Governor Schwarzenegger.  The relevant sections of SB 695 required the CPUC to develop a process and rules for a limited re-opening of DA to be phased in over a period of time, not less than three years, and not more than five years.

On March 11, 2010, the CPUC issued its decision setting forth the process and rules for the limited re-opening of DA.  As a result, all non-residential customers are now eligible to acquire electric commodity services from ESPs in each utility’s service area, up to a maximum allowable total kilo-watt hour (kWh) annual limit.  The maximum allowable annual limit was established based on the maximum total kWh supplied by ESPs during any sequential 12-month period between April 1, 1998 and October 11, 2009.  For SDG&E, the 12-month period when ESPs supplied the maximum kWh is from September 1999 through August 2000.

Direct Access is not available to residential customers that are not currently on DA, or that were previously classified as DA Eligible and had not submitted a 6-Month Notice to Transfer to Direct Access by March 10, 2010.

The CPUC adopted the implementation of the limited re-opening of DA under a 4-year phase-in schedule that became effective April 11, 2010.

Post-Phase-In Period for Direct Access

With the 4-year phase in schedule complete, authorization was needed for SDG&E to continue to accept customer requests to switch to Direct Access if future load should become available under the Overall Direct Access Load Allowance.  On December 12, 2012, the Switching Exemption rules were further modified by D.12-12-026 which adopted a lottery process in lieu of a first-come/first-serve process for customers to submit their Notice of Intent to Switch to Direct Access.   For a complete description of the adopted lottery process, see D.12-12-026, Appendix 1.