RSF School District Board Tackles Energy Storage

RANCHO SANTA FE — As power rates continue to climb, the Rancho Santa Fe School District continues to discuss alternative ways to save money. During the Oct. 5 monthly school board meeting, Superintendent David Jaffe introduced Bradley Johnson, director of finance, to present his research on battery storage solutions.   

The topic was not a new one for him, Johnson said. At a former school district, he helped bring on a battery storage company to mitigate the high costs of electricity usage.

“I thought it would be nice to check and see if this would be an opportunity for a company to come in and look at our utility usage,” Johnson said, “and to see if there’s an opportunity for implementing some type of intra-storage system to reduce costs.” 

Johnson pointed some of the components to a utility bill including the specific charges that take place during the higher peak times during the day, particularly in the mid- to late afternoon hours. During this timeframe, more electricity is being used, mainly if air conditioning units are on.

The theory behind the storage is that batteries, which are usually lithium-ion batteries, get their power in the evening when the rates are lower. After the energy is stored, it can be used during the day. 

Energy usage during peak times means customers are paying more to use energy. However, a customer could shave those high-peak costs if there was an energy storage solution in place. Johnson said there are potential opportunities for the district to save money.

Two energy battery storage solutions are a direct purchase option as is a power efficiency agreement. 

In the first scenario, the district would pay money up front to procure the battery storage units.

“Each year, you have ongoing operations and a software maintenance fee that you wind up paying on,” Johnson said.

Johnson also wanted the board to know about incentives that the state of California provides some school districts and government entities. It offers some funding to reduce a portion of those initial up-front costs.

A power efficiency agreement is when a company comes in at no cost to the district.

“Essentially, we are allowing them space to provide batteries to the district, and they essentially get a shared savings of whatever we wind up saving,” he said. “So, the overall savings to the district is less, but again we have nothing out of pocket.”

Board member Sarah Neal said that while one of the priorities of the district is to be more energy efficient, she’d like to see more of a strategic planning process by way of having a more in-depth conversation about district goals.

She did say how it was good to learn about technology as it evolves.

Board member Scott Kahn asked Johnson to look at the new SDG&E rate schedule. His concern was that any numbers Johnson had were based upon the current rate schedule and the new rates could very well be less favorable.

The school board thanked Johnson and asked that he continue his research on the matter.

RSF School District Board Tackles Energy Storage, by Christina Macone-Greene, The Coast News Group, November 10, 2017.

San Diego’s Community Choice Energy Technical Study Stands up Under Scrutiny

San Diego struggles under the yoke of the highest electricity prices in the state. Meanwhile, thousands of cities across the United Stateshave executed a plan to reduce their electricity prices, called Community Choice Energy. City officials hired an expert to determine if Community Choice would work here too. The technical study, also known as the feasibility study, found that San Diego would benefit from Community Choice, just like thousands of cities before it.

In July, when the City released the technical study, several publications such as the San Diego Union-Tribune and the Voice of San Diego highlighted the main finding of the study: “San Diego could provide cheaper, greener energy than SDG&E.” Now, having had several months to digest the findings and compare them to Community Choice Energy programs across the state, additional conclusions can be teased out of the study.

SDG&E provides high-cost energy with average clean energy content

To understand the technical study better, one needs context. Stating that CCE can provide “cheaper, cleaner” energy does not allow us to adequately judge the program. How much cheaper? How much cleaner? The following table lists the percentages of *pollution-free electricity from various providers in California.

Community Choice Energy vs. SDG&E
(
lowest cost clean energy percentage available)
Electricity Provider *Pollution-Free Percentage
Silicon Valley Clean Energy (CCE) 100%
Sonoma Clean Power (CCE) 90%
California Average Utility 44%
SDG&E 43%
*Pollution-Free includes all greenhouse-gas-free sources. The “California Average Utility” energy percentage includes nuclear and large hydro. The CCE programs listed include large hydro, but no nuclear energy. Large hydro and nuclear are not considered renewable energy in California.
Source: SVCE website and Power Content Labels for SCP and SDG&E

The first two providers in the table, Silicon Valley Clean Energy and Sonoma Clean Power are both California Community Choice Energy Programs. The least expensive electricity rate offered by those programs are 100% and 90% pollution free respectively. Each of those options is also less expensive than SDG&E electricity which is only 43% pollution free. Those numbers are not outliers either. All six Community Choice programs operating in PG&E’s service area offer a 100% renewable energy option for a lower cost than SDG&E charges its customers.

The third entry in the table allows another type of comparison: SDG&E versus average pollution-free energy. Not only does SDG&E not compare well to high performing energy providers, it does not even beat the average utility in the state when comparing pollution-free energy.

CCEs provide high amounts of pollution-free content and they provide cheaper energy too. All of the active CCEs in California provide lower cost electricity than the Investor Owned Utility against which they compete. A Community Choice program in San Diego should have an easier time outperforming the utility since SDG&E charges the highest electricity rates in the state.

Understanding how high SDG&E prices are is important. The following is an apples-to-apples comparison. Sacramento’s Municipal Utility provides its customers with exactly the same percentage of pollution-free energy as SDG&E. The California Energy Commission requires each electricity provider in the state to disclose how their electricity is generated in a standard form called the “Power Content Label.” The content labels below list the 2016 generation sources for Sacramento’s utility and SDG&E.

California Energy Commission chart showing Power Content Labels for Sacramento Municipal Utility District and San Diego Gas & Electric

The California Energy Commision published electricity generation sources for 2016 Source: California Energy Commission, Power Content Labels

Both utilities use 43 percent pollution-free energy and a nearly identical percentage of natural gas. Thus Sacramento provides a particularly useful comparison when reviewing how expensive SDG&E electricity should be. According to Sacramento’s 2016 annual report, SDG&E charges its customers 77% more than Sacramento’s rates pointing out that SDG&E rates should be much lower.

Graphic showing typical monthly residential bills

SDG&E charges the highest rates for electricity in the state of California Source: Sacramento Municipal Utility District, 2016 Annual Report, page 5

Feasibility study conclusions

 Armed with some insight into how cheap and clean electricity can be, the conclusions of the City of San Diego’s feasibility study appear obvious. San Diego could use Community Choice to achieve cleaner, cheaper energy. That simple statement belies the strength of the conclusion though. Page 122 of the feasibility study highlights that every criteria of the City’s Sustainable Energy Advisory Board the authors reviewed was found to be feasible.

Chart showing results of San Diego Community Choice Energy Feasability Study results

All the Sustainable Energy Advisory Board minimum performance criteria that were studied were found to be feasible Source: San Diego Community Choice Energy Feasibility Study, Table 35, page 122 (pdf page 160)

CCE works in San Diego even with conservative assumptions

The general findings from page 122 (pdf page 160) lead to the conclusion that the city should support community choice. However, the most powerful piece of information in the study might be the least obvious. It does not reside on any of the splashy tables or charts. The most powerful data in the study is the extremely conservative price point used for the cost of renewable energy. The authors initially state the wholesale market price of renewable energy… and then use a different dollar amount entirely for their calculations.

Page 33 of the study lists that solar power costs 4 to 6 cents per kWh. Without a careful reading of the study, one would have every reason to assume that the study authors use the average of those numbers, 5 cents/kWh, for the cost of renewable energy in the study. They did not.

Graph showing cost of power over period 2020 - 2035

Feasibility study, figure 29 listing the cost of renewable energy assumed by the study authors starting in 2020 at 10.1 cents/kWh. Source: San Diego Community Choice Energy Feasibility Study, Figure 29, page 122

Instead of 5 cents, the cost of renewable energy used in the pro forma (the financial calculations found in the appendix) opted to apply the cost of 10.1 cents/kWh for renewable energy in their 2020 scenarios, as seen in figure 29 above. The city’s consultant assumes that Community Choice Energy in San Diego would buy electricity for double the amount that their own expert said was available on the open market. Not only that, their expert had already built in a 25% or more margin in that number. The chart below compares the current cost of utility-scale solar to the figure used by the city’s consultant.

Chart showing Market prices for renewable energy in California versus feasibility study assumption

Market prices for renewable energy in California versus feasibility study assumption. Sources: Modesto Irrigation District Solar, City of Palo Alto Solar; the Q1 2017 SEIA national average solar was $0.99/watt which was defined on page 33 of the feasibility study as 4 cents per kWh ($40/MWh); LA County CCA Business Plan page 42; 2016 IOU renewable energy costs from 2017 Padilla Report page 2; San Diego Feasibility Study fig 29

The price for renewable energy used in the San Diego Community Choice Energy technical study was set two and a half times higher than the 2017 market price for utility-scale solar. According to the study, the purchase price of wholesale power makes up approximately 80 percent of the CCE program costs. If the consultant had used market price energy instead of a price 2.5 times higher, the assumed expenses incurred by the Community Choice program would have been between $100-150 million dollars less per year.

San Diego needs an option other than SDG&E

SDG&E charges customers up to 77% more than other utilities while providing below-average percentages of clean energy. The City’s Community Choice Energy technical study found every criteria studied resulted in a feasible outcome. The study authors used assumptions conservative enough to lead to a built-in margin of safety of over $100 million dollars per year.

One might assume that all of these findings would have led our city officials to the conclusion that Community Choice Energy makes sense for San Diego, that we should join the more than 70 cities in California that have already adopted CCE programs. Strangely, fewer than half of the City Councilmembers have publicly voiced their support for this form of cleaner cheaper energy, and Mayor Faulconer fritters away our money and air quality while waiting for a clean energy proposal from SDG&E, the very company demanding extortionary prices for electricity, to begin with.

Call to Action:

San Diego ratepayers can do two things to support Community Choice Energy.

  1. Go to the Sustainable Energy Advisory Board meeting this Thursday, November 16th (see link for time and location) and voice your support for Community Choice during the time allotted for public comments. The Board will be voting to approve a recommendation on the Community Choice feasibility study.
  2. Give your city representatives a call or send a quick email. Let them know you would like Community Choice Energy. Let them know you would like cleaner, cheaper energy. Tell them you do not understand why San Diego is nearly the only major population center in California to have neither a municipal utility nor Community Choice Energy.

Community Choice Energy is more than just feasible. It is a necessity.

City of San Diego Contact Information:

Mayor:
Kevin Faulconer, Mayor (619) 236-6330 kevinfaulconer@sandiego.gov

Councilmembers:
Myrtle Cole, Council President (619) 236-6644 myrtlecole@sandiego.gov
Mark Kersey, Council President Pro Tem (619) 236-6655 markkersey@sandiego.gov
Barbara Bry, Councilmember (619) 236-6611 barbarabry@sandiego.gov
Lorie Zapf, Councilmember (619) 236-6622 loriezapf@sandiego.gov
Christopher Ward, Councilmember (619) 236-6633 christopherward@sandiego.gov
Chris Cate, Councilmember (619) 236-6616 chriscate@sandiego.gov
Scott Sherman, Councilmember (619) 236-6677 scottsherman@sandiego.gov
David Alvarez, Councilmember (619) 236-6688 davidalvarez@sandiego.gov
Georgette Gomez, Councilmember (619) 236-6699 georgettegomez@sandiego.gov

 

Tyson Siegele, a SanDiego350 member, is an architect who works to promote sustainable design and clean energy. He is the creator of ButItJustMightWork.com, a residential clean energy handbook chronicling things to do as well as things to avoid on one’s path to zero emissions.

San Diego’s Community Choice Energy Technical Study Stands up Under Scrutiny, by Tyson Siegele, San Diego Free Press, November 14, 2017.

Solana Pacific Snips Ribbon on New Solar Panels

The Solana Beach School District flipped the switch on its new solar panel system on the Solana Pacific Elementary School campus Nov. 3, the first renewable energy project in the school district.

The ceremony for the new solar project was the first ribbon-cutting event for one of the district’s Measure JJ projects.

Solana Beach School District Superintendent Terry Decker said the district was very fortunate that Measure JJ passed with almost 66 percent of the vote, allowing improvements to touch all schools throughout the district. The summer was a very busy time as they completed the solar panel project, are nearly done with the renovation at Solana Highlands Elementary School, and are in the process of rebuilding Skyline School from the ground up.

“Our district mission is centered on developing compassionate students who ‘think globally and act locally’,” Decker said. “Our new solar program, an extension of our tax-payer supported Measure JJ infrastructure upgrades, will not only help save $50,000 in energy costs every year, but act as a living lab for students to learn about STREAM (science, technology, research, engineering, arts and mathematics) and sustainability as they prepare for careers of tomorrow.”

Members of the community were there to celebrate the first ribbon-cutting event as well as Solana Beach School District (SBSD) board members and staff, Solana Pacific Principal Elisa Fregoso, San Diego City Councilmember Barbara Bry, San Diego Deputy Director of Energy and Sustainability Jack Clark and the district’s partner on the panels, OpTerra Energy Services.

The Solana Beach Band provided the musical entertainment for the groundbreaking and Solana Pacific students shared “fun facts” about the system, including that the system will generate enough electricity to power 21.5 homes in Solana Beach for one whole year and with the same amount of clean energy they produce, they could power nine Teslas a day or 3,350 electric vehicles a year.

In addition to energy cost savings, the panels will offset 199 metric tons of greenhouse gas emissions annually, the same as taking 42 cars off the road every year.

“The sun shines bright on the Solana Beach School District and we embrace the opportunity to take advantage of this energy for our school,” said SBSD President Debra Schade. “Solana Pacific students will be the generation that understands the importance of solutions to real-world problems such as climate change and global warming. They will be the generation to fully embrace clean energy and transportation and the leaders in efficient use of our planet’s resources. This project confirms we have the power to make the change.”

Councilmember Bry said the district’s solar project was a great example of a public agency doing their part to conserve, particularly as the city of San Diego moves toward reaching the “ambitious” goals in its Climate Action Plan.

“We are committed in the city of San Diego to eliminate half of all greenhouse gas emissions in the city and to aim for all electricity needs of the city to be from renewable sources by 2035,” Bry said. “Thank you for this great representation of walking the walk on fiscal stewardship and environmental action.”

Crista Curtis, regional business development manager for OpTerra, said she has the fun job of partnering with cities and school districts on projects that embrace clean energy and support local innovation.

Locally, OpTerra has worked with the city of Solana Beach and the San Dieguito Union High School District in their sustainability efforts. From solar carports to rooftop mounted panels and a battery storage system at the new Earl Warren Middle School, San Dieguito is expected to save over $10 million in energy costs over 15 years and about 50 percent of the district’s electricity needs are now met by solar.

“It is with great pride that the San Diego-based OpTerra team has been able to help Solana Beach School District’s vision for sustainability come to life on campus at Solana Pacific Elementary,”Curtis said. “Over our short, three-month construction period, we have helped transform an idea for clean energy production into a reality – we helped create 50 local construction jobs in the process and a foundation for students to learn from for years to come.”

Solana Pacific Snips Ribbon on New Solar Panels, by Karen Billing, Del Mar Times, November 8, 2017.

Kilroy Celebrates New Solar Project in Carmel Valley

Kilroy Realty celebrated its new solar project with a ribbon-cutting event on Nov. 2 at Kilroy Centre Del Mar in Carmel Valley. The project is part of Kilroy’s commitment to sustainability as well as a contribution to San Diego’s Climate Action Plan that seeks to achieve 100 percent citywide renewable energy usage by 2035.

Working in partnership with Nautilus Solar, the Carmel Valley project on Valley Center Drive is one of nine Kilroy Realty properties in California to undergo a solar project to collect and convert solar rays into useable, clean energy. The solar panels provide shaded canopy parking, source clean and renewable energy, reduce the community’s dependence on non-renewable fuels and strengthen the resiliency of the energy grid.

“We’re marching toward our goal of using 100 percent renewable energy citywide and it’s great to have innovative companies like Kilroy Realty stepping forward to do their part to help us get there,” said Mayor Kevin Faulconer. “San Diego is the number one city in the country for solar installations and it’s in no small part to builders who make sustainability a priority in their projects.”

Kilroy’s six San Diego projects will offset energy usage by 65 percent and generate six million kilowatts annually, power 558 residential homes, and create 138 green jobs in the local economy.

“We celebrate not just our solar project but the city-wide efforts towards sourcing renewable energy, and are extremely fortunate to be led by Mayor Kevin Faulconer who has been active in fostering a supportive environment for sustainable practices,” said Nelson Ackerly, senior vice president of Kilroy Realty. “These solar installations represent one more step in our journey to be the greenest real estate investment trust in the world.”

Jeffrey Cheng, chief operations officer of Nautilus Energy, said the company was pleased to partner with Kilroy and Black Bear Energy to support Kilroy’s award-winning sustainability initiatives.

“This multi-site solar portfolio exemplifies how businesses can successfully partner together to achieve renewable energy goals,” Chang said.

Sara Neff, senior vice president of sustainability of Kilroy Realty, said it was “amazing” to cut the ribbon on their solar project but they are far from done. Ackerly said Kilroy thinks about sustainability in everything they do, from design to construction, leasing to accounting and beyond. He said they will continue to work at upgrading their buildings and pushing themselves and the market to do more on sustainability.

“We look forward to pursuing even more aggressive sustainability initiatives in the future,” Neff said. “We thank all of our partners, and especially Nautilus Solar and Black Bear Energy, for all the work they put into making this day possible.”

Kilroy Celebrates New Solar Project in Carmel Valley, by Karen Billing, Del Mar Times, November 9, 2017.

San Diego School District Backs Public Energy Program as Alternative to SDG&E

The San Diego Unified School District Board of Education called on the city of San Diego this week to adopt a government-run alternative to San Diego Gas & Electric.

The board adopted a resolution on Tuesday urging to the city to implement community choice aggregation, a program that allows elected officials to buy and sell power for ratepayers in their jurisdiction. Local investor-owned utilities continue to maintain the poles and wires that deliver electricity.

Customers paying for electricity through a city-run community choice program have the option of opting out and paying the utility rates, potentially creating competition between the two entities.

An independent study contracted by the city found in July that community choice would provide more green energy at a cheaper rate over time.

Mayor Kevin Faulconer has yet to take a position on community choice.

The district hopes to work with local elected officials through the program to boost the use of solar power in the region, said board President Richard Barrera.

“We believe that if the city adopted (community choice) it would advance the push in San Diego towards reusable energy and that he San Diego Unified School District would benefit form that,” he said.

The district has so far invested in solar panels at eight schools and expects to install systems at another 12 sites by 2019.

The district is also considering a number of other strategies to dramatically reduce its greenhouse emissions, from encouraging more students to take the bus to school to improving water and energy efficiency in buildings.

“The district is moving towards of goal of zero carbon emissions, and we believe we can be a net producer of sustainable energy,” Barrera said.

The City Council will face a number of votes in coming months on whether to move forward with community choice.

The shareholders of SDG&E parent company Sempra Energy, along with the San Diego Regional Chamber of Commerce and the San Diego County Taxpayers Association, have asked the city to put the program on hold.

The county Board of Supervisors declined to study the program earlier this year after lobbying by Sempra’s shareholders.

San Diego School District Backs Public Energy Program as Alternative to SDG&E, by Joshua Emerson Smith, The San Diego Union-Tribune, October 26, 2017.

San Diego Climate Report Shows Progress — Thanks To Whom?

San Diego remains ahead of schedule in meeting the goals of its landmark Climate Action Plan, according to a progress report released by city officials Wednesday.

The annual report found greenhouse gas emissions in 2016 were about two percent lower than 2015, and 19 percent lower than the climate plan’s baseline year of 2010. Mayor Kevin Faulconer praised San Diegans for their efforts to conserve water and energy, and for leading the nation in the installation of rooftop solar panels.

“This is steady progress that shows the actions that we are taking collectively as a city are making a difference,” he said at a news conference announcing the report.

The report attributed most of the reductions in greenhouse gas emissions to state and federal programs — something that was true for last year’s progress report as well. Nicole Capretz, executive director of the nonprofit Climate Action Campaign, said there is more officials could be doing to reduce the city’s carbon footprint.

“We’re grateful that the mayor has taken some steps in the right direction,” Capretz said. “But given the scope and scale of the climate crisis, and what kind of future we are confronting, we need bolder, quicker action.”

San Diego is facing several major decisions in the coming months and years that could pave the way for the climate plan’s success or failure. One is the decision on whether to adopt community choice aggregation (CCA), a program that would allow city officials to choose where San Diegans get their energy.

A peer-reviewed study released this summer found a CCA program could offer cheaper and greener electricity than SDG&E. The City Council is scheduled to decide whether to move forward with community choice in January.

Another factor that could influence the city’s climate action success is the development of the 2019 Regional Transportation Plan. The plan, crafted by the San Diego Association of Governments, determines how much the county will invest in low-carbon transportation options like public transit and bicycling versus car-focused infrastructure like freeways and roads.

Transportation, which accounts for 54 percent of San Diego’s greenhouse gas emissions, is one area where the city faces extreme challenges in reducing its carbon footprint.

The climate plan envisions half of all San Diegans who live in so-called “transit priority areas” getting to work via biking, walking or riding public transit by 2035. But transit ridership has been on the decline for the past two years, and city officials have no good data on how many commuters are biking or walking to work.

The challenges San Diego faces in reducing car dependence were in plain sight at the city operations yard where the mayor held his press conference: The employee parking lot was full of cars.

Cars fill a city employee parking lot at the Chollas Operations Yard, Oct. 25, 2017. (PHOTO BY KRIS ARCIAGA/KPBS)

San Diego Climate Report Shows Progress — Thanks To Whom?, by Andrew Bowen, KPBS, October 25, 2017.

Solana Beach Votes on Next Step Toward Community Choice Energy

The Solana Beach City Council is scheduled to vote Wednesday night on whether to move into the next phase of preparing for Community Choice Energy. The city of 13,000 residents is at the forefront of a growing trend in San Diego County to take more local control of where residents get their energy.

The city has been considering Community Choice Energy, or CCE, since 2011, and is beyond the stage of doing feasibility studies; technical studies of Community Choice and peer reviews have come out positive. They conclude that providing more sustainable energy at potentially lower rates is possible for the city.

Now the question is, will the council decide to go ahead with the next phase, which includes community engagement, exploring contracts and creating rate structures. This is the point at which the city would begin to invest money, not just staff time, in implementing the plan.

RELATED: 7 Things To Understand About Community Choice In San Diego

City Manager Greg Wade said if the council moves forward, there’s a possibility Solana Beach could be launching the program next year.

A staff report shows 13 Community Choice programs already operate in California, but Wade said the Solana Beach City Council needs to know if the local community is behind the idea.

“We’d be the first, potentially, in the SDG&E area,” he said. “It’s important to have all that information before they decide whether to move forward.”

Community Choice programs rely on only a limited percentage of residents opting out of the program to be economically feasible.

RELATED: Following The Money In San Diego’s Community Choice Debate

Wade said about 120 people responded to a community outreach poll and 88 percent of them said they were interested in having a CCE program in Solana Beach.

Interestingly, when asked which was most important to them: lower rates or increased renewable energy, more people — over 90 percent — chose increased renewable energy.

Wade said the city recently passed its Climate Action Plan, and adopting Community Choice Energy is essential to meet the plan’s goals.

The City of San Diego is also considering Community Choice Energy. Several North County cities are also considering the option, but have yet to commit.

Solana Beach Votes on Next Step Toward Community Choice Energy, by Alison St John, KPBS, October 11, 2017.

San Marcos Pairs up With Tesla to Bring Solar Power to Schools

Tesla Motors Inc., known for building high-end electric cars, will be powering San Marcos schools, as well.

Last December, the district inked a deal with the Silicon Valley energy company to introduce solar arrays at most of its campuses. Construction on that project starts today at Paloma Elementary School, and will be rolled out in phases to San Marcos campuses.

Tesla will install, operate and maintain the equipment, and the district will purchase power at reduced rates, saving an estimated $30 million over the 20-year contract.

“That will assist us in maximizing our financial resources, protecting taxpayer dollars, and ensuring that the maximum amount of money is spent supporting the classroom and instruction,” said Mark Schiel, assistant superintendent of business services.

In addition to stretching its budget, Schiel said, the panels will provide shade, reduce the district’s carbon footprint and potentially provide instructional material and data for classroom lessons on alternative energy.

“You’re pulling yourself off the grid, and reducing your footprint on the electricity grid, and converting the sun that’s already coming down into a viable energy source,” Schiel said. “While they produce solar for the district, they produce shade. We’re able to put carports in our parking lots. It’s creating shade structures that students can play under, study under, or eat lunch under.”

Today, crews are putting up construction fencing at Paloma Elementary in preparation to install the solar arrays, Schiel said, and shortly afterward they’ll start solar installation at San Elijo Elementary School, Woodland Park Middle School, and Mission Hills High School.

In the second phase, the district will add solar at Twin Oaks, Joli Ann, San Marcos, and Knob Hill Elementary Schools. And in a third round, solar installation will take place at Discovery Elementary and Carillo Elementary Schools, San Elijo Middle School, Double Peak, and San Marcos High School. The remaining five sites, several of which are under general construction, would come on board in a final phase.

Once the solar facilities are installed district-wide, they will produce an estimated 10.1 million kilowatt hours – more than 80 percent of the schools’ annual usage of 11.4 million kilowatt hours, Schiel said. The average American home used 10,812 kilowatt hours in 2015, according to statistics from the U.S. Department of Energy.

At Mission Hills High School alone, he said, solar arrays will generate 1.6 million kilowatt hours in the first year, supplying 83 percent of the school’s projected use. The district will pay about 14 cents per kilowatt hour for that power – less than half of what it currently pays to San Diego Gas & Electric Co., Schiel said.

This is not Tesla’s first foray into San Diego-area schools. In 2015, the company contracted to build stationary battery storage systems for Escondido high schools. The batteries charge at night when power is cheaper, and then emit the stored energy during daytime hours, saving the district about $300,000 per year.

Last year, Tesla expanded its scope when it purchased SolarCity, the nation’s largest rooftop solar provider, in a bid to create a one-stop shop for cleaner energy.

The San Marcos project is part of a shift toward solar by San Diego area schools smarting from rate hikes by San Diego Gas & Electric Co. that raised their power bills by a collective $30 million starting in the 2014-15 school year.

Last year, Escondido Union High School District installed solar arrays at its campuses through a power purchase agreement with San Jose-based SunPower, which owns the panels and sells electricity to the district at reduced cost. Also in 2016, Encinitas Union School District contracted added solar projects at several schools, contracting with Sullivan Solar Power to install the $5 million systems, which are expected to recoup $21 million over 25 years.

San Marcos Pairs up With Tesla to Bring Solar Power to Schools, by Deborah Sullivan Brennan, The San Diego Union-Tribune, October 12, 2017.

Sempra, Chamber Lobbying Asks San Diego to Put Government-Run Electricity Program on Ice

A debate is nearing a boiling point over whether the city of San Diego should form a government-run alternative to San Diego Gas & Electric — a move that could foreshadow a massive overhaul of electrical markets across California.

The city is facing several votes in the coming months that could either shelve the program indefinitely or put it on a path to form what could be the state’s largest such program, known as a community choice aggregation.

While backers of community choice in San Diego have been vigorously lobbying for the program around the county, a new group has emerged to raise questions about the program — asking city officials to freeze it, at least temporarily.

Dubbed the Clear the Air Coalition, it pairs lobbyists paid by the shareholders of SDG&E’s parent company Sempra Energy with some of the region’s most powerful groups — from the San Diego Regional Chamber of Commerce to the Downtown San Diego Partnership to the San Diego County Taxpayers Association.

“The city is going to have to make a very important decisions, and we’re seeing that they’re going to be making that on incomplete information,” said Jerry Sanders, head of the chamber and former mayor of San Diego. “All I think is they need to wait.”

What is community choice?

Under community choice, SDG&E would continue to operate and charge for the poles and wires that deliver power, but elected officials would assume control of the buying and selling of that electricity for city customers.

Ratepayers can opt out of the community choice program if they prefer the utility’s rates, potentially creating competition between the two entities.

Supporters of the publicly controlled alternative to SDG&E have also been pushing elected officials throughout the county to adopt Climate Action Plans to reduce greenhouse gases. Part of that campaign has included pressuring cities to commit to using of 100 percent renewable energy in coming decades — and then adopting community choice as a way to realize that goal.

The city of San Diego has pledged to use all renewable power by 2035 but has yet to decide how it will try to get there.

“There doesn’t exist another viable way for the city of San Diego to get to 100 percent other than to be in control, and community choice offers this proven model,” said Nicole Capretz with the Climate Action Campaign and the leading advocate for community choice in the region.

A feasibility study contracted by the city of San Diego completed this summer found that the program has the potential to deliver cheaper rates than SDG&E over time, while providing as much as 50 percent renewable energy by 2023 and 80 percent by 2027.

However, Sempra and its backers argue that those numbers are not reliable because state energy regulators are expected next year to overhaul a technical but key factor in the rates charged by community choice programs.

They argue that the city should not vote to move forward with the program until the hearings are complete. Those steps would include releasing a request for proposals for a third party to draft a business plan and eventually city officials adopting that implementation blueprint. The process would likely take more than two years before a community choice program could officially launch.

“What we want is cost-effective approaches to greenhouse-gas reduction,” said Haney Hong, president and CEO of the Taxpayers Association. “When you have so many different unknowns about what it might potentially cost … how can you make a decision without the information?”

The exit fee debate

The California Public Utilities Commission has announced that in 2018 it will overhaul the formula it uses to calculate an exit fee, which community choice programs pay to investor-owned utilities to ensure those companies are adequately compensated for the energy contracts they have signed on behalf of ratepayers who have subsequently left for the government-run alternative.

Those costs includes everything from long-term contracts for natural gas projects to renewable power deals that utilities entered into before the cost of solar and wind power dropped.

Neither side disputes the need for the fee, which is intended to protect ratepayers that remain with an investor-owned utility from seeing sharp increases in their electrical bills.

However, utility officials and community choice advocates vociferously dispute how it’s calculated.

If the commission’s new formula increases the fee, it could mean community choice programs have less revenue to compete with investor-owned utilities.

The fee, which could eventually be phased out in coming decades, has steadily increased in the past and could do so again.

“We believe it’s going to go up significantly more,” said Frank Urtasun, a former SDG&E official who is now the sole employee of Sempra’s shareholder marketing group, known as Sempra Services.

Urtasun is quick to explain that SDG&E doesn’t make a profit off buying and selling electricity, but losing a large percentage of its customers to a community choice program means the exit fee needs to be very carefully calculated.

“We can support community choice aggregation so long as it’s equitable for all customers, so that if a city leaves it doesn’t have upward pressure on rates to some other cities,” he said.

Sempra shareholders this year became the first in the state cleared by regulators to pay for lobbyists on the issue of community choice, after SDG&E requested approval for the marketing division at the California Public Utilities Commission. This arrangement has been required by the Legislature since lawmakers banned several years ago utilities from tapping ratepayer money to influence the local adoption of community choice programs.

Advocates of community choice have said they care deeply about the outcome of the commission’s decision on the exit fee, but they expect the results of the proceedings will bring consistency for ratepayers.

“Stability in the market place is in the state’s interest,” said Barbara Hale, who heads San Francisco’s community choice program, CleanPowerSF. “It’s in our interest. It’s in the utility’s interest — not a decision that destabilizes the market and the experience of customers.”

In San Diego, supporters of community choice have pointed out that the city’s program wouldn’t likely be operational until at least 2020, well after the commission rules on the fee. If community choice becomes financial nonviable, they argue, the city will have plenty of time to back out.

“All the city would be doing is moving from a feasibility study to a business plan,” Capretz said.

“There is no one statewide who is stopping their forward-moving progress” on community choice because of the proceedings on the exit fee, she added.

What’s at stake?

Matthew Freedman, staff attorney with The Utility Reform Network, who closely tracks community choice issues at the state Public Utilities Commission, said that it’s not clear whether the changes to the exit fee will benefit community choice programs or utilities.

“At this point, no one can predict what the outcome of that preceding would be,” he said. “You could guess, but nobody has an inside line on what’s really going to happen there.”

But, he added, it’s the investor-owned utilities that have the most to lose, not the local governments that launch community choice programs. Cities and counties insulate themselves from debt incurred under the alternative-energy program often using a joint powers authority or an enterprise fund.

Investor owned utilities, on the other hand, rely on the exit fee to be made whole for their investments.

The precise nature of the fee might not be significant for utilities if only a small percentage of their customers leave for a community choice program, but in the case of SDG&E, the city of San Diego represents 40 percent of all electrical sales in the utility’s service territory.

If the exit fee doesn’t accurately compensate SDG&E for its stranded costs, it could mean that ratepayers in other areas bear the burden through increased rates, further motivating the formation of more community choice programs, Freedman said.

“Their number one motivation is they don’t want to get stuck eating any of the costs associated with customer departures,” he said. “And at some point, we could all fight about ‘Well, shouldn’t the utility shareholders eat those costs?’ That’s their nightmare scenario.”

It’s not just SDG&E that could lose a huge percentage of its customers to community choice aggregation, raising major questions about who will pay for their expensive legacy contracts.

The state’s first community-choice program started in Marin County nearly a decade ago, and in recent years, adoption and interest in such programs have spread like wildfire.

Energy regulators said this summer that the state must prepare for community choice to expand from representing about 5 percent of all electrical sales today to nearly 70 percent by 2020.

In San Diego County, Solana Beach appears close to formally adopting community choice, while Encinitas, Del Mar, Oceanside and Carlsbad are weighing the option.

However, following lobbying efforts by Sempra, the county Board of Supervisors in February shelved a community-choice proposal.

Sempra, Chamber Lobbying Asks San Diego to Put Government-Run Electricity Program on Ice, by Joshua Emerson Smith, The San Diego Union-Tribune, October 7, 2017.

RE:FOCUS San Diego Community Choice

As California’s energy grid seeks to become more green, advocates are calling for a new plan to make SDG&E owned by the government. The process is called Community Choice Aggregation. The U-T’s Daniel Wheaton interviews environmental reporter Joshua Emerson Smith on the subject.

Community Choice Aggregation, by Daniel Wheaton, RE:FOCUS, October 16, 2017.