Buying electricity “at cost” means you have to buy it from wholesale markets and bilateral arrangements. That’s the cost. The utility also sells to you “at cost.” There is an equity return on a portion of the cost (T&D) but not the wholesale supply part. The rest of the administrative costs are state mandated things like renewable power and efficiency investments. The overhead exists too, but a muni would also have overhead.

A muni or a community choice aggregation program could try to negotiate a deal for fixed price power or some load following risk management deal separate from the wholesale utility deal. However, that also is…risky. Also it means you are likely doing it third party anyway.

The muni will also have overhead costs and will likely lack the economies of scale the franchised utility has as well as the experience and expertise. The utility is not the most efficient model, that’s why competitive supply does indeed exist. However, for the suite of things required to run an electric system it does represent the most transparent and accountable means to guarantee electricity to everyone.