A divided County Board of Supervisors moves ahead on community choice energy
- Sep 11, 2019 12:17 pm GMT
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Sep. 10--A divided San Diego County Board of Supervisors voted 3-2 Tuesday to pursue a community choice energy program that would offer an alternative to San Diego Gas & Electric when it comes to purchasing power contracts -- but the board also voted to come back on Oct. 15 to determine what kind of governance model it should operate under.
"We're moving forward and it's long overdue," said supervisor Dianne Jacob, who joined Nathan Fletcher and Greg Cox in voting to establish community choice aggregation, or CCA. "The bottom line is we're providing individuals and businesses choices where they buy their electricity."
The EES Consulting group from the Seattle area has estimated a CCA would lead to customers in the county's unincorporated areas seeing electricity rates about 2 percent lower than SDG&E's.
But Supervisors Kristin Gaspar and Jim Desmond questioned the wisdom of joining a growing number of CCAs that have sprung up across California.
"As a small business owner and fiscal steward of this country, I can't simply assume that this will all pan out like all these other jurisdictions are doing," Gaspar said. "We've seen big promises like this before." She cited the costly ticket guarantee the city of San Diego entered into with the Chargers back in 1997 and the California energy crisis of 2000-2001.
Despite voting in favor of the motion, Cox expressed reservations.
"I think we should make haste slowly, he said.
The supervisors directed county staff members to come back before the Oct. 15 hearing with more details about how the program would be implemented.
Under the CCA model, communities take on the responsibility of buying the source of electricity (solar, wind, natural gas, etc.) for a given jurisdiction. The incumbent utility still assumes all other duties, such as distributing the power and handling customer service and billing.
The state's first CCA was formed in Marin County, and in the space of nine years, 19 CCAs have come online, boasting they can supply cleaner sources of power at an equal or lower price than traditional power companies.
When it comes to their governance, CCAs commonly partner with jurisdictions in other cities and form a joint powers authority, or JPA, that oversees the energy choice program.
The city of San Diego has invited the county and eight other cities to join a regional JPA, with San Diego taking the lead. As an enticement, San Diego has offered to oversee initial startup costs for a CCA that would be up and running by 2021.
The city councils in La Mesa and Chula Vista have taken San Diego up on its offer, directing their staffs to take steps to finalize agreements with the city.
But the proposed San Diego plan would include a weighted vote option for the board that governs the CCA. Since San Diego's share of the electricity load is so large, it would have the largest percentage in cases when a weighted vote is called for.
San Diego has vowed to cap its weighted vote at 49 percent but the county Board of Supervisors balked, fearing San Diego would have too much influence.
"It's out because of the weighted vote," Jacob said. "That was a deal breaker. One jurisdiction, one vote is a counting that we feel is fair."
An equal vote structure is a feature of a fledgling JPA being pushed by Carlsbad and Solana Beach. By all indications, supervisors responded favorably to joining the more North County-centric JPA that also estimates it can be operational by 2021 and deliver a 2 percent savings on SDG&E's rates.
"I think it's a more equitable way going forward," Cox said.
Before Tuesday's vote, members of the Strategic Roundtable, a local business group critical of CCAs, called on the board to pause before moving forward. "The first question should be, does a $2-a-month reduction per household that is estimated by county staff justify rushing into a new, complex and volatile non-core business for the county," asked Julie Meier Wright, a former president of the San Diego Regional Economic Development Corp.
The county has put into place a Climate Action Plan that calls for 90 percent renewable sources by 2035. Supporters of CCAs said adopting community choice energy is critical to meeting that goal.
"Our planet is burning up, literally," said Joy Frew of the Fallbrook Climate Action Team. "It's because of the carbon we're putting in the air ... We don't have time to wait."
On Monday night, the Del Mar City Council also tackled the CCA question.
The council passed on joining the city of San Diego-led regional JPA and voted 5-0 to initiate negotiations to form a joint powers agreement with Carlsbad, Solana Beach and other potential jurisdictions.
Council members said they liked a number of elements of San Diego's proposal but, like the county supervisors, expressed reservations about San Diego's weighed vote option.
"I feel comfortable that our long-term interests are better aligned with Carlsbad and Solana Beach than with the city of San Diego," said council member Dwight Worden.
Solana Beach has already formed its own standalone CCA that has been up and running for one year but has expressed strong interest in partnering with some of its North County neighbors to form a multi-jurisdictional JPA.
Del Mar Councilwoman Terry Gaasterland described Solana Beach's experience in the CCA as "essential" for Del Mar to move forward. "If we partner with Solana Beach and Carlsbad, we are not too small and we have like-minded neighbors," she said.
Mayor David Druker said, "Any time anybody says we're going to save costs, I always hold my wallet. if we save costs, that's great. As long as we are not more expensive (than SDG&E's rates), I think that's gotta be the initial goal. The other goal is we need to be able to get back our return on investment. Whatever type money we put in, we need to be able to get that back."
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