Federal solar tariffs not a disincentive for Davis

On Jan. 22, President Trump issued his long-awaited ruling on the penalties to be imposed on the world’s solar module manufacturers who sell their equipment into the U.S. market. Effective Feb. 7, there is a 30-percent solar import tariff for crystalline-silicon solar cells and modules.

The decision has left many solar hopefuls wondering whether their plans for a rooftop solar system will need to be delayed or dashed entirely.

Others may wonder what the decision means for Davis’s burgeoning solar businesses. And, what does it mean for the city of Davis’ aspirations to encourage 50 percent of its households to install solar systems by 2020?

What about Davis?

Davisites shouldn’t see a significant change in system economics of solar. While pricing may increase slightly, the economics for going solar will continue to far outweigh the opportunity cost of not doing it.

Local energy experts report that in states and localities where energy prices are already high, like California and Massachusetts, the tariff on solar modules is expected to increase prices by only 3 to 4 percent for an average residential system.

More silver lining? Some industry analysts predict that this price increase won’t be long lived and will stabilize in the second half of 2018.

Richard McCann, energy economist at M.Cubed and chair of the Cool Davis Energy Steering Committee is sanguine about the impacts of the tariffs on the residential market. “Most of the costs in home installation are in the labor and other hardware; the panels are only a quarter of the cost. Panel costs have been dropping rapidly for a lot of reasons, and the installers are becoming more efficient. Combining that with falling prices for battery storage, we will continue to see improving economics for home energy systems.”

Kerry Daane Loux, city of Davis sustainability coordinator, agrees the tariff won’t be a disincentive for locals. “The City has set clear goals and benchmarks for Solar PV to Double Up on Solar in our community by 2020. We continue to move forward working with Cool Davis to encourage and support households choosing to power themselves with renewable energy. This year we saw a slowdown in adoption locally which may have been due to the uncertainty created by the threat of this tariff decision. In the coming year we expect that we will see a robust response from Davis residents making smart decisions for their families and their community.”

The tariff

The tariff level steps down by 5 percent each year until it hits 15 percent by the fourth year. Currently, there are just a handful of countries exempt from this tariff, including India, Turkey and Brazil. NAFTA partners Canada and Mexico are not exempt from this tariff. (Note: The first 2.6 gigawatts of cells are exempt from the tariffs each year.)

Mitch Sears, Interim general manager for Valley Clean Energy, the local community-choice aggregation program set to begin serving electricity customers in Woodland, Davis and unincorporated Yolo County in June 2018, shares the same general outlook as other local experts.

“The Valley Clean Energy Board will be setting net energy metering rates for roof-top solar in February. Like our general discount of 2 percent below PG&E generation rates, we expect that the Board will set more favorable NEM rates compared to PG&E. This could be one additional small factor within the communities served by Valley Clean Energy that helps off-set the anticipated costs associated with the tariff.”

Foreign-owned companies drove decision

The tariff push was driven by Section 201 of the 1974 Trade Act, which is the United States’s “global safeguard” law. A petition filed under Section 201 with the International Trade Council allows for temporary relief when surging imports are causing “serious injury” to a U.S. industry.

Two U.S. module manufacturers petitioned the ITC: one that is majority-owned by a German company, whose parent is undergoing bankruptcy proceedings in Germany, and one that is no longer in business but was majority-owned by a Hong Kong based company.

The presented evidence showed that the market share for U.S. companies had actually remained about the same through the explosive growth in panel manufacturing. The complaint appeared to be centered on the presumption that U.S. companies should have had a disproportionate share of the market growth. The Solar Energy Industry Association opposed the tariff as did almost all other American solar companies.

The ITC found that there was injury caused by imports back in September, paving the way for the president to unilaterally determine whether tariffs should be imposed, and if so, to determine the amount of such tariffs.

SEIA estimates that the new tariffs will cause the solar industry to lose 23,000 solar jobs, many of which are localized jobs, spread out in communities throughout the country. According to SEIA, of the industry’s 260,000 solar jobs, less than 2,000 are directly tied to manufacturing solar cells or modules — processes which are largely automated. Most solar industry jobs are in the areas of sales, installation, distribution, technical support, and customer service.

Emerging markets hit hardest

The impact of the solar tariffs will be felt differently across the country. In markets where traditional electricity rates are high, such as California and Massachusetts, solar will continue to be economically advantageous, bringing solar pricing back to where it was about two years ago.

In other markets, such as Florida and Texas where electricity rates are significantly lower and solar is on the cusp of getting market traction, this tariff is going to be a major setback on the advancement of solar penetration.

 

Federal solar tariffs not a disincentive for Davis, by Aaron Nitzkin, Davis Enterprise, February 8, 2018.

Goodbye, diesel: California school buses drive toward electric age

The classic American school bus — yellow, loud and trailing diesel exhaust — may soon get an electric upgrade.

Each weekday morning, buses running on nothing but battery packs shuttle students to schools in northern Sacramento and the neighboring suburbs. The vehicles — made by Lion Bus of Quebec, Trans Tech Bus of New York state and Motiv Power Systems of Hayward — are cleaner and quieter than their diesel-burning brethren. Since they spend most of the day idle, recharging isn’t a problem.

“It really fits for school districts, with the way we operate,” said Timothy Shannon, director of transportation for the Twin Rivers Unified School District. “The kids are excited about riding them, because they’re electric and they’re new.”

School districts across California are experimenting with electric buses, drawn by the appeal of exhaust-free driving. They are partnering with state and local government agencies to share the high up-front cost — anywhere from $225,000 to $340,000 for an electric bus, versus $100,000 for the fossil-fuel version — while hoping to recoup some of the money through lower maintenance and fuel bills.

“We want to make sure the (environmental) footprint we leave out there is as minimal as possible,” said Terry Guzman, director of transportation for the Napa Valley Unified School District, which had two of its diesel buses converted to electric. “And with the kids, their respiratory systems aren’t fully formed yet. Diesel’s something we want to move away from.”

All of the country’s major school bus manufacturers, including Blue Bird and Thomas Built Buses, are introducing electric models.

California officials, who view electric vehicles as weapons against global warming, are starting to funnel money to school districts willing to give buses a try. The Legislature last year approved spending $180 million of the proceeds from the state’s climate change cap-and-trade system on vouchers for hybrid or zero-emission trucks and buses. Another $100 million will go to a program that, among other things, pays to replace old school buses.

In addition, California utility regulators last week approved a $2.2 million Pacific Gas and Electric Co. proposal to study using electric school buses as, in essence, big batteries that can send energy back to the state’s electric grid when needed. School districts could one day get paid by utilities to use their buses for energy storage.

Many districts have been pursuing cleaner buses for years, and they already have alternatives. The majority of the Napa district’s 56 buses, for example, run on compressed natural gas, which puts out almost none of the tiny soot particles that come from burning diesel. Other buses run on propane. Even diesel buses are much cleaner than they once were: Since 2014, California has required large school buses to have filters to trap most of the soot, although the vehicles still emit smog-forming nitrogen oxide as well as the greenhouse gas carbon dioxide.

The idea of a plug-in bus for students isn’t new. Blue Bird built an early version in 1994, with lead-acid batteries. Napa tried those as well, Guzman said, but they took too long to recharge between runs.

“They wouldn’t always accept enough of a charge for us to know we could safely get to American Canyon and back,” he said. “But the technology with batteries has changed so much, that’s not necessarily going to be a problem now.”

Guzman recently drove one of the district’s newly converted buses — switched from diesel to electric by TransPower of Escondido (San Diego County) — to Lake Berryessa as a test, and found that the bus used less electricity on the trip than he expected, despite the hills. But the two converted buses, which use lithium-ion batteries, have been plagued with electronic glitches that appear to be tied to the vehicles’ motherboards, prompting the district to send them back to TransPower for repair.

“I’m not going to risk having a breakdown with kids,” said Guzman, whose district transports 1,100 to 1,300 students per day. “And I don’t want an $800 tow bill, either.”

With a typical range of about 80 to 100 miles per charge, the current crop of electric buses works well on most twice-daily routes. Longer field trips, however, aren’t a good fit, said Mark Plumb, transportation manager for the Torrance Unified School District in Los Angeles County, whose district also has two buses converted from diesel to electric by TransPower.

“They don’t go far enough for us to use them on athletics, after they’ve run a full day,” Plumb said. “They wouldn’t have the range to take a team out to someplace in L.A. and bring them back.”

Joshua Goldman, TransPower’s vice president of business development, said buses with longer ranges will come, as the technology improves. And he acknowledged that Napa’s converted buses have had bugs. Torrance’s, too.

“We recognize that they’re early adopters of new technologies on hand-built buses,” Goldman said. “And a lot of lessons have been learned on those buses, but we’ve still got a ways to go. … I’ve been working on heavy-duty (vehicles) for 20 years, and the first ones are always the hardest.”

As battery costs drop, and production of electric buses cranks up, Goldman expects the vehicles to reach cost parity with conventional buses sometime between 2025 and 2030. Jim Castelaz, chief executive officer of Motiv Power Systems, which makes electric power trains that manufacturers can integrate into their buses and trucks, also expects prices to drop. But he isn’t sure parity is necessary for the technology to take off.

Like other electric vehicles, plug-in buses should require less maintenance over time than those with internal combustion engines, he said. And the electricity to fuel them will cost substantially less than diesel.

“It costs one-sixth to one-eighth as much to operate as a diesel bus,” Castelaz said. “I don’t think electric buses need to be the same price as diesel buses. It’s a much better product.”

 

Goodbye, diesel: California school buses drive toward electric age by David R. Baker, The San Francisco Chronicle, January 15, 2018.

SMUD removes ‘solar surcharge’ from customer bills

The Sacramento Municipal Utility District said Wednesday that it has removed the state-mandated “SB-1 solar surcharge” from all customer bills.

The surcharge dates back to former Gov. Arnold Schwarzenegger’s “Million Solar Roofs Initiative,” a surcharge SMUD said is currently equal to $0.0016 per kilowatt-hour of electricity usage, or about $1.20 on an “average” SMUD customer monthly bill. The surcharge was initiated in 2008.

Effective Jan. 1, SMUD initiated a previously approved rate increase of 1.5 percent for all residential customers in 2018 and a 1 percent increase in both 2018 and 2019 for all commercial customers. SMUD said the current average monthly bill for a customer using 750 kilowatt-hours of electricity is $109.88. The 1.5 percent increase will boost that by $1.62 a month.

With the removal of the SB-1 solar surcharge, SMUD said the average residential customer using 750 kilowatt-hours per month of electricity will now see an average net increase of about 42 cents a month (the $1.62 average increase minus the average $1.20 SB-1 solar surcharge). Removing the surcharge from business customer bills will, on average, offset the entire 1 percent rate increase, SMUD said.

The utility said the recently initiated rate increases will be used for upgrades for a modern energy grid and to meet customer needs. The increases also will go to improve technology that SMUD customers use to monitor and manage their energy use.

Funds from the solar surcharge were used to help develop residential and commercial solar capacity throughout SMUD’s service area.

The utility said the funds helped build approximately 125 megawatts of solar generation over the past 10 years. That includes incentives for residential and commercial customer solar installations, Smart Home developments and SolarShares developments.

Recent fund use included $1.4 million awarded to the Sacramento International Airport to support its installation of two new solar arrays with 6.8 megawatts of capacity. The arrays produce enough electricity to handle approximately one-third of the airport’s power needs, saving the airport approximately $850,000 in energy costs each year, SMUD said.

Per the state mandate, SMUD said the SB-1 solar surcharge was in effect until SMUD had collected $130 million. SMUD said it reached that cap in late December and immediately removed the surcharge from billings.

SMUD said it has disbursed approximately $125 million of solar funds to date and will disburse the remaining funds by the end of 2020.

 

SMUD removes ‘solar surcharge’ from customer bills, by Mark Glover, The Sacramento Bee, January 10, 2018

Solar farm opens at Sacramento International Airport

Sacramento International Airport will now use more than 30 per cent solar power with the opening of a new facility.

The 7.9-megawatt solar farm consists of a 15-acre east site on Aviation Drive and a 20-acre site north of the runway. The facility is comprised of more than 23,000 LG solar panels mounted on NEXTracker racking that tracks the sun’s path from east to west over the course of the day, maximising efficiency and energy production.

The electricity generated by the facility is enough to power 1,600 homes a year.

In mid-December, airport officials and community representatives gathered at the site to celebrate months of hard work and collaboration.

The airport had no costs for construction. The capital investment was provided by NRG, which financed construction by Borrego Solar. NRG owns and operates the facility and will sell electricity to Sacramento International Airport at a reduced rate under a Power Purchase Agreement (PPA).

Projected cost savings from the project are an average of $850,000 annually throughout the 25-year term of the agreement.

“This is an exciting development for the Sacramento International Airport. By partnering with a private company, we have a source of clean, renewable energy that will save money and furthers our commitment to sustainable practices,” said John Wheat, Director of Airports for the Sacramento County Department of Airports. “It’s truly a win-win scenario.”

“Over 10 million travellers fly in and out of Sacramento Airport each year who will now be able to see the value of solar at work and witness the airport’s commitment to clean, reliable, renewable energy,” said Kevin Prince, Sr. Director of Business Development, NRG Renewables. “The airport and county had the vision to embrace solar technology. With this system now operational, we can offset one-third of the airport’s annual load and, on certain days like today, offset the entire electricity needs of the airport.”

Borrego Solar Systems, a leading national developer, designer, installer and operator of commercial solar and energy storage systems developed and built the arrays.

“By adopting solar, Sacramento Airport has not only made a prudent financial decision, but has also taken action to reduce its environmental impact. The solar energy produced over the life of the system will offset nearly 289,000 metric tons of harmful carbon dioxide equivalents – this is the same amount that would be offset by taking nearly 62,000 cars off the road,” said Jackie Pitera, a senior member of Borrego Solar’s project development team.

“I want to congratulate airport leadership on a successful project and working with our operations team and NRG to get a solar project up and running in just six months of construction.”

 

Solar farm opens at Sacramento International Airport, by Editorial Staff, International Airport Review, January 9, 2018.

Transforming the UC’s Energy Portfolio

Solar development has contributed significantly to the UC system’s goal of carbon neutrality by 2025, and UC Davis has played a major role in this progress. However, more challenges still lie ahead to achieve a balance between environmental and economic sustainability.

According to its website, the South Campus Large Solar Power Plant, which became active in 2015 and is located south of I-80 near the Raptor Center, produces 16.3 megawatts (MW) of power, which helps to offset UC Davis’s carbon footprint by about 14 percent annually.

“[This 14 percent] will vary from year to year, depending on total generation, total consumption and other sources of greenhouse gas emissions,” said Camille Kirk, the director of sustainability and a campus sustainability planner.

The 16.3 megawatts represent almost half of the 36 megawatts of on-campus solar power generation in the entire UC system, showing that UC Davis is leading the way when it comes to solar energy.
At the Environmental Protection Agency’s Green Power Leadership Awards in late October, David Phillips accepted an award on behalf of the University of California. Phillips was a key figure in the development of the South Campus project while he held the director of utilities position at UC Davis.

In addition to the South Campus project, UC Davis also has rights to 24 percent of the power from the 60 MW Five Points Solar Park in Fresno County and the 20 MW Giffen Solar Park, helping UC Davis provide about 36 percent of solar power generated in the UC system.

While the solar investments are proving to generate adequate amounts of power to chip away at the reliance on carbon, costs remain a question for skeptics.

“Due to lower than expected electricity pricing over the last couple of years, the solar projects are currently costing more per kWh than wholesale electricity,” said David Trombly, a utilities engineering supervisor. “If electricity costs go up as projected, the solar energy pricing will become favorable.”

Even with the likelihood that solar and other renewables will become favorable in the future, it still remains important to proceed intelligently in the development of renewable energy with one eye on sustainability and the other on economic realities. James Bushnell, a professor of economics at UC Davis who has done research on energy policy and environmental economics, expressed concern about how rapid solar development can cause excess supply at certain times of day and alter prices.

“While the costs of solar continue to decline, the value of solar output in California is declining even faster,” Bushnell said. “This is because there is already so much solar output on our system that we have a glut of energy during the middle of the day. In April 2017, electricity produced in the middle of the day was almost worthless because we already had more than we could use.”

Storing solar electricity has long been a concern if there is excess production, an issue that Kirk also discussed.

“We could have installed more solar if we had sufficient storage to avoid exporting,” Kirk said. “When we installed our Large Solar Power Plant, analysis showed that storage did not make financial sense, and probably still wouldn’t, though we do continue to explore storage options, especially as part of class projects.”

Despite these challenges, Kirk remains optimistic that these investments will prove to be worth it in the long run.

“We expect electricity prices to rise from other providers, so our on- and off-site solar through the power purchase agreement model of delivery should prove to be cheaper in the long run because we have a fixed price for electricity for the duration of our contracts,” Kirk said.

Kirk and Trombly agreed that the UC’s goal of carbon neutrality by 2025 is highly ambitious, but they think that UC Davis is on the right track.

“UC Davis is very well-positioned and has already demonstrated major progress in reducing emissions,” Kirk said. “Carbon neutrality is an ambitious goal, but we think we can achieve it through many different steps.”

Trombly echoed these sentiments, adding that after these major investments in solar power, it may be prudent to explore other types of clean energy to supplement UC Davis’ solar and hydroelectric power and its biodigester, each of which contribute to an energy portfolio that is currently about 60 percent carbon-free.

“We would probably benefit from diversifying our investment in renewables to some other production type, but these decisions will be hashed out as part of the climate action planning process,” Trombly said.

While engineers and project managers work to design, develop and fund new renewable energy efforts across the UC system, students are also engaging in the process by spreading crucial information with their classmates and working to bring change to campuses.

CALPIRG, a group that is active on campus on the issue of getting UC Davis to commit to an entirely renewable energy portfolio, is pleased with the progress that has been made in the last several years to reduce the entire UC system’s reliance on fossil fuels.

“The UC system is doing great work for the environment with a commitment to carbon neutrality,” said Jillian Patrick, a fourth-year environmental science and management major and UC Davis’ CALPIRG chapter chair. “Solar and other clean energy sources are becoming increasingly more affordable and accessible — renewable energy is the future.”

While the UC as a whole has an additional 13 megawatts of solar power in development, UC Davis currently does not have any pending plans for more solar projects, given the dent that its solar investments have already put in the carbon neutrality goal. However, with CALPIRG’s activism, UC Davis may develop more renewable projects in the coming years to continue transforming and diversifying the school’s energy sources.

“So far this quarter we have collected over 1,000 petitions through outreach and engagement with the campus community to show our Chancellor there is ample support for 100 percent clean energy here at UC Davis,” Patrick said.

Transforming the UC’s Energy Portfolio, by  Benjamin Porter, The California Aggie,

Pioneer Community Energy Goes Live February 2018

Pioneer Community Energy is a Community Choice Aggregation (CCA) Program that was formed by the jurisdictions of Auburn, Colfax, Lincoln, Loomis, Rocklin and Placer County through a joint powers authority. The Lincoln City Council issued a resolution adopting Ordinance 947B on June 27, 2017 following a public hearing.  The ordinance authorized the City to join the Sierra Valley Energy Authority JPA and to implement a CCA program in Lincoln.

Pioneer will begin providing energy in February 2018; at this time, all ratepayers who have not completed an opt-out form will be automatically transitioned to Pioneer. The main benefits of Pioneer are competitive rates lower than PG&E, as well as local control over electricity and community investments. PG&E will continue to provide the distribution of energy, as well as all gas services.

Pioneer Community Energy is a separate agency that is not managed by City. City staff has reached out to Pioneer Community Energy to obtain answers to many of your questions.

Read full article on the City of Lincoln webpage.

Pioneer Community Energy Goes Live February 2018, City of Lincoln, December 5, 2017.

Valley Clean Energy Alliance Gives SMUD the Green Light

For the record…

The Valley Clean Energy Alliance has plugged into Sacramento Municipal Utility District, which will provide power for Davis, Woodland and much of unincorporated Yolo County.

The decision means that the Sacramento-based energy provider will source power for the VCEA’s portions of Yolo County, while also offering technical service, data management, customer support and more.

According to the alliance’s press release, the board of directors had several options.

“VCEA was fortunate to have a number of very capable service providers to choose from,” said Don Saylor, Yolo County Supervisor and VCEA board chairman. “With their depth of expertise, cost competitive proposal, and close alignment with (our) mission, the exceptional value of SMUD’s proposal was clear. We’re eager to get started.”

Saylor heads the alliance with five other representatives, who receive local voice from nine appointed community members.

The VCEA originally derived from the city of Davis and Yolo County in December 2016. Woodland joined the organization in June, adding mayor Angel Barajas and Councilman Tom Stallard to the board.

“We look forward to reaching an agreement with SMUD that will allow us to effectively stay on track to launch clean renewable energy to our customers by June 2018,” Barajas said in response to the news. “We are excited to have expertise and experience on our side with SMUD.”

Since its inception, the joint-powered authority has worked to plug locals into Community Choice Energy. Under that system, involved customers — homeowners and business — may choose to opt “in” or “out” of sourcing electricity from a variety of companies, including wind and solar providers. The county would continue to use Pacific Gas & Electric infrastructure for transmission and billing services, but the power running through the lines to each individual home could be sourced from more renewable sources.

Individual customers would be able choose where their power derives from, and that choice will be considered by the VCEA should they decide to expand certain power providers.

In recent months, the VCEA has powered through an aggressive schedule, and should they adhere to it, Woodland, Davis and unincorporated Yolo should have SMUD-sourced power in the summer of 2018.

Though SMUD will provide power, PG&E will continue to provide the infrastructure — wires, poles, grid — for Yolo County.

As stated, the board’s choice would wean the affected cities from PG&E, continuing a turf-war between the two companies over areas near Sacramento. In 2006, PG&E successfully won Yolo over from SMUD following a contentious public vote and has since provided power to the majority of the county, including West Sacramento. Now, however, SMUD has convinced Woodland, Davis and other rural Yolo areas to switch over.

The two companies have competed over the Sacramento Valley since SMUD formed in 1923.

According to West Sacramento’s website, the city continues to source power from PG&E.

Based on a meeting in late July, the VCEA will soon conduct community outreach programs to inform the public about the flip of the switch.

Four mailers will be sent to residents notifying them and educating them on the VCEA’s mission. Recipients can mail back to opt out of the program and instead source their power through their current provider, PG&E. Without doing so, Woodlanders, Davisites and Yoloans will automatically be placed within the CCE.

Valley Clean Energy Alliance Gives SMUD the Green Light, by Hans Peter, Woodland Daily Democrat, September 1, 2017.

Valley Clean Energy Alliance Submits Implementation Plan to CPUC and Approves Contract with SMUD

(From Press Release)– The Valley Clean Energy Alliance (VCEA) Board of Directors unanimously adopted a resolution to approve its Implementation Plan and Statement of Intent (Plan) and authorize its submission to the California Public Utilities Commission (CPUC) for certification. The CPUC has 90 days to complete its review and certify the Plan.

“Delivering the Implementation Plan to CPUC is an essential step and important milestone for VCEA,” says Lucas Frerichs, City of Davis Councilmember and VCEA Vice-Chair. “We are that much closer to achieving our goal of delivering competitive rates, cleaner energy, and better electricity options for the local communities that will be served by VCEA.”

The Plan is a legal requirement of all Community Choice Energy (CCE) programs. By adopting the draft Implementation Plan, the VCEA Board is establishing the initial design of the program. Consistent with other operational CCEs across California, the plan maintains flexibility to accommodate shifts in wholesale energy markets, the legislative and regulatory landscape, and other factors that may impact operations over time.

Simultaneously, the VCEA Board unanimously approved its contract with SMUD for program launch and operations.

“The partnership between VCEA and SMUD is a testament to a movement that supports local decision making, affordable energy costs, and greenhouse gas reduction. All at a not-for-profit level,” says Angel Barajas, Mayor of the City of Woodland and VCEA Board Member.

The approved Master Services Agreement is a contract for the services required by VCEA to launch the program and begin serving customers in June of 2018. VCEA staff, legal counsel, and consultants negotiated with SMUD’s executive and legal team to finalize the approved Agreement and first two Task Orders that address technical energy services, data management and the establishment of a call center to provide customer support. Additional Task Orders addressing wholesale energy services and operational services will be brought to the Board for consideration in November.

SMUD is the nation’s sixth-largest community-owned electric service provider, serving approx. 1.5 million people across  900 square miles. SMUD has been providing low-cost, reliable electricity for more than 70 years to Sacramento County and small adjoining portions of Placer and Yolo Counties.

Valley Clean Energy Alliance Submits Implementation Plan to CPUC and Approves Contract with SMUD, by Staff, The Davis Vanguard, October 19, 2017.

Yolo County Partners with SMUD – A New Model of Community Choice Development?

As Community Choice agencies spring up around the state, they are experimenting with various new business models. As they do, they are functioning as innovation incubators.

Valley Clean Energy Alliance (VCEA), a new Community Choice agency comprised of the Cities of Davis and Woodland and unincorporated Yolo County, is using an approach not previously tried in California. Rather that contracting with a private electric service provider, VCEA is contracting with their neighbor SMUD (Sacramento Municipal Utility District) to provide these and other services.

According to VCEA board member and Yolo Supervisor Don Saylor, the relationship with SMUD began ten years ago when Yolo County tried through a ballot measure to be served by SMUD. The measure, fiercely opposed by PG&E to the tune of over $9M, was defeated. Even so, through the campaign SMUD professionals and Yolo County elected officials and staff developed a healthy appreciation for each other.

Saylor said that VCEA did not start out with a plan to partner with SMUD. VCEA put out a request for proposals (RFP) for an array of services including energy procurement, technical service, a call center, and community outreach. At the same time, they started conversations with SMUD and encouraged them to respond to the RFP.

The costs of going with SMUD versus other private contractors that bid on the RFP were comparable. But Saylor said that the comprehensive nature of the services that SMUD provided created efficiencies that were attractive to the board. SMUD’s work in the public interest and their transparency and accountability were also seen as beneficial by VCEA’s board. The vote to move forward with SMUD was unanimous among the 15 voting elected officials. On October 12, VCEA approved the implementation plan and the master service agreement with SMUD. VCEA’s proposed launch date is June 2018.

Saylor foresees that the partnership with SMUD will give VCEA on day one capacities in energy procurement and related services that other Community Choice agencies must develop over time. VCEA plans to hire a general manager and three to five staff, mostly for contract management. The staffing plan is still under development. He emphasized that VCEA would retain governance, rate setting and policy functions, as well as accountability to customers. VCEA has also contracted with Circlepoint to handle community outreach and maintain some independence from SMUD.

When asked how the relationship with SMUD and VCEA’s staff would impact the development of local resources, Saylor responded that the relationship would actually accelerate their deployment. He pointed out that Yolo County already has a strong track record of developing local resources, and argued that if VCEA has a solid administrative and operational foundation with SMUD, it will free up board and staff time to develop local projects.

Saylor noted that VCEA has participated as an affiliate member of CalCCA, the Community Choice trade association, and that he anticipates they will be a full member after launch.  Having SMUD as a contract partner should enhance Community Choice agencies’ standing in Sacramento with the legislature because of the respect SMUD enjoys with state policymakers. This could prove important going forward. Proposed state legislation this year would have severely harmed Community Choice. This legislation didn’t pass, but will likely return in 2018.

Mitch Sears, interim General Manager for VCEA, agrees that SMUD’s experience, capabilities, and orientation toward advanced energy solutions will “give them a jump start” in local resource deployment. Sears felt that “this kind of partnership with a public utility seems like a natural fit, because of the alignment around public service. It might be a useful approach for others to consider.” He also sees potential not only in partnering with SMUD, but also with the UC Davis Energy Efficiency Center and other municipal partners.

Gerry Braun, a member of the VCEA Advisory Committee and founder of the nonprofit Integrated Renewable Energy Systems Network that supports the development of local clean energy resources, was more measured in his assessment of the potential for SMUD to accelerate the development of local energy resources. He said that although SMUD has done quite a bit of research and development regarding local energy resources, they have actually implemented less per capita than Davis and Woodland have.

Braun explained that strong local energy management capacity is the key ingredient for developing local energy resources. He is skeptical that a vertically integrated utility like SMUD has both experience and motivation to perform well on local resource development. He said the partnership was “an opportunity to do really well and stay focused on the core CCA business, but maybe not develop the full transformative potential of the enterprise.”

Although SMUD has tremendous capacity as an electric service provider, they may not be as experienced as other contractors in dealing with PG&E and particularly that utility’s complicated rate setting and billing system.

The future will show whether VCEA’s partnership with SMUD enhances their capacity to develop local programs and resources, and is a model to emulate.

Yolo County Partners with SMUD – A New Model of Community Choice Development?, by Barry Vesser, Center for Climate Protection, October 18, 2017.

 

 

Nonprofit Moves Forward on New ‘Net Energy’ Housing in Woodland

For local nonprofit Mutual Housing California, the recent allocation of nearly $10.8 million in tax credits means that the organization can move forward on the positive net energy phase of Mutual Housing at Spring Lake in Woodland.

Like the first phase, the second phase of the community on Farmers Central Road will be built as year-round affordable housing for agricultural workers and their families, according to Dell Richards of Dell Richards Publicity.

The recent funding from California State Treasurer John Chiang’s office is the last piece of the financing puzzle that the Sacramento-based developer has been waiting for.

“Securing funding for affordable housing is extremely challenging,” said Rachel Iskow, Mutual Housing California chief executive officer. “We are relieved that funding has come through and that we can start construction on the positive net energy phase of the community.”

Mutual Housing received $3 million from the U.S. Department of Agriculture and $1.5 million from the city of Woodland for the development.

“Financial commitments from the City of Woodland and the USDA made it possible for us to obtain tax credits in this highly competitive program,” stated Iskow.

Few other rental developments nationwide use solar and achieve zero-net energy, much less positive net energy.

“Positive Net Energy” means that the community will create more energy than it uses through high-efficiency building methods and materials, solar panels, energy-saving appliances and technology in each home as well as resident participation in an energy-saving lifestyle, stated Richards.

Known as Mutual Housing at Spring Lake, the initial 61 apartments and town homes were the first multifamily rental development certified as zero-net energy in the nation by the U.S. Department of Energy.

The development also was the first LEED Platinum-certified homes for multifamily housing in Woodland.

In 2002, Mutual Housing became the first developer to install solar photovoltaic systems at a multi-family rental development in Sacramento County. All of its new developments produce solar energy.

Mutual Housing currently has solar energy on 12 of its 19 communities in Woodland, Sacramento and Davis.

The nonprofit also has used green building techniques while designing and constructing new developments and renovating all older ones.

In the process, they have tested and worked with new technology as part of the sustainable vision that is the core of its mission, Richards stated.

Construction on the second phase of Mutual Housing at Spring Lake should start early next year and be completed by early 2019.

Founded in 1988, Mutual Housing California develops, operates and advocates for sustainable housing for the diversity of the region’s households.

A member of NeighborWorks America — a congressionally chartered nonprofit organization that supports community development nationwide — Mutual Housing has more than 3,200 residents, nearly half of whom are children.

Nonprofit Moves Forward on New ‘Net Energy’ Housing in Woodland, by Democrat staff, Woodland Daily Democrat, October 5, 2017.