City Files Papers to Join Valley Clean Energy Alliance

Believing it’s the “right thing to do,” Woodland’s City Council is taking steps to link up with the Valley Clean Energy Alliance as a way of not only using more renewable energy but cutting costs as well.

Following a presentation last week, the council took formal action to join the Energy Alliance in hopes they can over the next several years see rate reductions of more than 3 percent.

The Yolo County supervisors are scheduled to hear the application and most likely accept it when they meet on Tuesday. The Davis City Council — the other participant in the Energy Alliance — accepted the application during a meeting last week.

Serving as the city’s representative on the governing board of the Energy Alliance will be Mayor Angel Barajas and Councilman Tom Stallard.

The action took place last Tuesday following a presentation by Roberta Childers, the city’s environmental sustainability manager, and Public Works Director Greg Meyer. A formal request to join the alliance had been expected after weeks of research and discussion by city staff and the council.

“I think it’s the right thing to do,” said Councilman Skip Davies, who argued six months ago that the city should take a cautious approach to any type of merger.

Davies has noted some companies already purchase their power independently of PG&E and that having other businesses and residents in the community doing the same made sense, but also posed problems if not done correctly.

Davies was primarily concerned about whether the estimated savings could be obtained and on Tuesday he said it would be hard to reach the projected cost savings of 2 percent to 3 percent “initially” because it would take time to set up the agency. Other projections have seen a rate drop of between 4 percent and eight percent, showing how much the estimates vary.

The Energy Alliance was developed under a statewide Community Choice system, which allows local governments to buy develop power on behalf of their public facilities, residents, and businesses. The aims are to increase local choice in energy supply and provide electricity with high renewable energy content at electric rates that are competitive with those of the incumbent investor-owned utility, such as PG&E.

PG&E would still continue to provide power as well as maintain power-transmission systems, but the decision on where the power comes from falls to individual entities. Some county’s, such as Marin, already have Community Power systems in place.

Initially, the council had some reservations on linking up with the Energy Alliance, based mainly on cost, but those fears seem to have eased. The $500,000 initial investment, Childers told the council earlier, does represent a financial risk. But it could also easily be made up in terms of overall energy savings by both the city itself and PG&E customers.

Councilwoman Xochitl Rodriguez said she was excited to be joining the Alliance while Councilman Enrique Fernandez thought it would not only be “great for the county but for California.

“The environmental and financial savings are clear,” he said.

“I hope our community understands we really want to do this but to some extent we’re compelled to do this,” said Councilman Tom Stallard. “It’s important for use to remain competitive. It’s also a trend of what’s going on around the stgate. It will give us more control over our ‘energy destiny.’”

The switch-over to the Energy Alliance may not occur until February 2018.

Earlier, Childers told the council that typically customers are given an option of deciding whether their want their power to come from 50 percent, 75 percent or 100 percent renewable energy sources, with rate structures reflected in their picks.

The specific types of energy sources have not specified, although utilities have been moving more heavily toward solar, wind and other alternative methods rather than hydroelectric within in California.

The steps being taken toward reducing the carbon footprints of California cities has been underway since 2015 when a “people’s power” movement began.

From a local viewpoint, people can see the effects everywhere. Private homeowners are being besieged by calls from solar-power companies promising access to cheap — or no cost — energy. Meanwhile, cities, school districts and even private individuals are installing solar-power collectors in parking lots that also serve as sunscreens or on rooftops.

To its proponents, installing solar-energy panels is a no-brainer. But to its critics, it’s just a lot of hype — a feel-good solution that will lead to unstable prices, empty promises and — at least for the time being — no additional green energy and no reduction in global warming.

Overseen by a team of energy experts and a board of elected officials, new community-run utilities are buying power from the grid, procuring a higher percentage of renewable energy — think solar and wind, as well as methane from dairy cows — than PG&E, while aiming for a price around or even below the giant utility’s rates. The new power systems also are charged with developing more local renewable energy.

California’s pioneer of “community choice” utilities was Marin County, which launched Marin Clean Energy in 2010. Sonoma County followed in 2014.

From 2010-13, Marin Clean Energy claims, its customers reduced cumulative greenhouse gas by 63,482 metric tons, equivalent to removing 13,365 cars from the roads each year.

Critics, however, have said the figures are misleading because the new companies are simply buying power from the grid that would have been purchased by giant utilities like PG&E anyway. And until the new utilities begin generating their own power, critics say, “community choice” power is essentially a paper transaction.

The groundwork for the California movement began two decades ago, largely related to the failure of energy deregulation that led to rolling blackouts several years later. That prompted the 2002 passage of state legislation, Assembly Bill117, directing California’s Public Utilities Commission to facilitate the creation of “community choice” power.

California’s landmark 2006 climate legislation — which requires utilities to buy 33 percent of their electricity from renewable sources by 2020 — further spurred the trend. That led to cities and counties developing “climate action plans,” which included exploring “community choice” systems.

Woodland passed its own Climate Action Plan as part of the 2035 General Plan this last week. That plan calls for eventually making the city a “zero net energy user,” meaning all of its power will come from renewable sources.

And i 2015, the Legislature dialed up the number with Senate Bill 350, which requires utilities to buy 50 percent of their electricity from renewable energy resources by 2030.

As of 2016, 27 percent of PG&E’s power comes from renewable energy. By comparison, Marin Clean Energy’s renewable energy portfolio is at least 50 percent, and Sonoma’s is 36 percent.

Even with the creation of the new utilities, PG&E continues to deliver the electricity, maintain power lines, send bills and provide customer services. But since these new local utilities are able to buy electricity now — with wholesale energy prices historically low — they are able to sell it to their customers at lower rates than PG&E, which locked up its energy contracts years ago when prices were higher.

That’s why PG&E also gets to charge customers who bolt a monthly exit fee, which helps PG&E make up for the energy contracts it purchased years ago to cover areas such as Marin and Sonoma that now have their own power systems.

While energy experts say the exit fee will disappear over time, until that happens the cost of the fee will fluctuate, reflecting the difference between the market price of energy when PG&E signed its contracts compared with the price of energy today.

Marin Clean Energy is also committing more than $500 million in new projects, including $24 million to build a 10.5-megawatt solar project in Richmond. And Sonoma Clean Power has contracted to develop 86 megawatts of new solar power.

It’s hoped that any energy savings achieved by the local Energy Alliance will eventually do the same thing in Yolo County, meaning that even more renewable energy will be available for purchase in the future.

The Bay Area News Group contributed to this story.

City Files Papers to Join Valley Clean Energy Alliance, by Jim Smith, Woodland Daily Democrat, May 21, 2017.

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