A clearer picture has emerged for how many California businesses will soon have the ability to choose their electric company, and how businesses will be able to exercise this new right.

As we've previously noted, legislation has expanded the right of California business customers to choose their energy provider, but the law must still be implemented by state regulators.

Under a draft decision from the California Public Utilities Commission, the new expanded limits on electric choice (known as "direct access") would be phased in over a four-year period.  While the draft must still be approved by the full Commission, it represents a consensus of all parties on the major issues related to electric choice, and is not likely to change substantially.

The draft would set the maximum amount of annual direct access load as 11,710 gigawatt-hours (GWh) at Southern California Edison, 9,520 GWh at Pacific Gas & Electric, and 3,562 GWh at San Diego Gas & Electric.  However, there are numerous California business customers already shopping for electric companies due to grandfather clauses enacted in 2001.  These customers' load will be subtracted from the maximum caps listed above, leaving the following amounts of new direct access load available at each utility: 3,946 GWh at SCE, 3,946 GWh at PG&E, and 462 GWh at SDG&E.

Starting around this April, the utilities will commence an "open enrollment" window in which customers may declare their intent to choose their energy provider, and reserve space under these new caps.  Space will be allocated on a first come, first served basis.  Given the limited space available (especially at SDG&E), making a quick decision will be crucial for businesses wishing to choose their energy supplier.

Under the phase-in process, only 50% of the total available space will be made available for new direct access customers in 2010, and a "gold rush" has been predicted as business customers are eager to leave high utility electric rates in favor of cheaper electric prices available through choice.

Being among the first businesses to send a Notice of Intent to shop for your electric supply will be paramount in ensuring you will have the right to save money on your energy bill.  At the same time, making a quick decision can be difficult for many businesses who have never chosen their electric company before, as choice has been suspended in California for a decade.

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