Woodland Closer to Fusing with Valley Clean Energy Alliance

A little more energy — and a lot more money — by the city of Woodland could see a drop in energy costs.

The Woodland City Council is on the verge of finishing an arc of study on becoming a member of the Valley Clean Energy Alliance with Yolo County and the city of Davis, an effort of which could give power customers more choice in where their power originates.

Acting last Thursday, the council gave what could be its last informal blessing with preparing the paperwork and moving ahead with formal linkage to the Energy Alliance. All that’s needed now apparently is some paperwork and $500,000 toward startup costs, according to the city’s Environmental Sustainability Manager Roberta Childers.

The city has been studying the issue for the last six months or more and now seems ready to make the investment. About two weeks ago, the council received a report from Tom Flynn, chairman of the city’s Community Choice Energy Technical Advisory Committee, recommended onto the program after months of research and study.

If implemented, it is estimated city energy users could see rates drop between 4 percent and 8 percent compared to those of PG&E. For the city of Woodland — which also buys its power from PG&E — the savings could be reinvested back into additional energy conservation programs or used for other purposes.

Action is need now so Woodland could secure at least two seats on the board of the Energy Alliance in order to have a say where power is purchased and for how much. The switchover to the Energy Alliance might still not occur until February 2018.

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 City Council had some reservations on linking up with the Energy Alliance, based mainly on cost, but those fears seem to have subsided. The $500,000 initial investment, Childers told the council, 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.

“The financial projections by Yolo County and subsequent projections for Woodland’s efforts,” Childers explained, “showed the likelihood of substantial economic benefits that would benefit the entire community. Davis and Yolo County would not have decided to go forward with a VECA recommendation if there weren’t the expectation of good customer rate savings or at least competitiveness with PG&E rates and healthy rate savings.”

Childers said the $500,000 could be reimbursed within one or two years after the Energy Alliance was formed.

Council members were supportive with Skip Davies — who said he liked the concept about nine months ago although he had questions about cost — now “fully supports the project.” Davis in the past has noted that some businesses in town already purchase their power independently of PG&E.

One other risk is for customers, noted Childers and City Manager Paul Navazio. Those who did not want to participate in the Energy Alliance would have to “opt out” of the program and pay a fee of an as yet undetermined amount.

Childers said there is a “lot of discussion” underway between PG&E, Public Utilities Commission and other investor-owned utilities on how to “better calculate the exit costs of customers and how to make those fees more predictable.”

Nonetheless, Councilman Tom Stallard — a longtime supporter of renewable energy — said it was “important (to note) there’s no stated position from PG&E on this. I’ve read that many as 40 percent of customers and perhaps as many as 80 percent” are making this switch. “So this is a trend. PG&E will continue to provide power … they’ll still be installing lines and installing pipe … (but) we gain control of their sources of energy and we can continue to emphasize renewals which is important to meet our climate action plan.”

Childers said that typically power customers are given an option of deciding whether their want their power to be coming from 50 percent renewable energy sources, 75 percent or 100 percent, with rate structures reflected in their choices. The specific types of energy sources were not specified, although utilities have been moving more heavily toward solar, wind and other alternative methods rather than hydroelectric, for example.

Councilman Enrique Fernandez had a series of questions about the proposal, but also said he supported membership in the Energy Alliance “200 percent” for the both decreasing costs and cleaner energy production.

And Mayor Angel Barajas said he supported it as well, noting it would help small businesses and give them an opportunity to use their savings elsewhere.

Woodland Closer to Fusing with Valley Clean Energy Alliance, by Jim Smith, Woodland Daily Democrat, May 7, 2017.

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