“San Diego and its community choice energy district would be able to offer a diverse energy mix with all of the solar, biodiesel, biogas, and energy storage resources that we have in San Diego. A product that is price competitive and yet at the same time would strive for and achieve a higher level of renewable content.”
See how this southern California city is striving for more clean energy and more local control in this interview with Lane Sharman, co-founder and chair of the San Diego Energy District Foundation.
A Fight Against ‘Solar Taxes’
The rise of the San Diego Energy District Foundation was in response to fees proposed on solar customers by San Diego Gas and Electric in October 2011. Thanks to the efforts of Lane, Bill Powers, and others in and outside of the foundation, the solar-crushing “Network Usage Fees” were not adopted. It was a particularly important win, because the fees would have applied to those customers who had already installed solar, with the expectation that they wouldn’t pay extra for going solar.
Pursuing More Local Energy Control
The Energy District Foundation wasn’t satisfied with stopping their monopoly utility from implementing bad policy, it wanted to create an energy system that put the community in charge of implementing policy that was positive for the economy and the environment. In 2012, members of the Foundation worked with Protect Our Communities, a nonprofit organization focused on using California’s community choice aggregation law, to create a local entity in charge of greening up the city’s energy supply with local power. They hope to follow in the footsteps of Marin County and Sonoma County in prioritizing local control of a cleaner energy system, at competitive prices.
Why Public Power?
The interest in local control over energy purchases is rooted in the inherent conflict of interest between ratepayers and their existing for-profit utility. Utilities in California make money by investing in hardware (power plants, power lines, and the like) and not finding the cleanest, lowest cost power for their ratepayers. In part, this is because taxpayers pick up the tab for pollution from fossil fuels. A public entity is more likely to incorporate those externalities. Water, sewage, and education all provide examples of where the public sector provides excellent local service.
How Renewable Can San Diego Be?
A 2010 study called the San Diego Regional Plan for 100 percent Renewable Energy outlines the technical potential for clean energy in the region. But it’s the market prices for clean power than are most encouraging. Open bids for new energy in Texas, for example, had solar bidding in at 5¢ per kilowatt-hour compared to retail energy prices of 15¢ or more. The county has approved (in 2013) a comprehensive energy plan that will include an investigation of a local energy aggregation.
A ‘Monopoly Protection Act’
Incumbent utilities don’t much like the San Diego Energy District Foundation and its plan for local control of the energy system. The big three corporate monopoly utilities in California are behind a new bill (AB 2145) that would completely undermine community choice aggregation by changing a key provision of implementation. Currently, when a local government establishes a local aggregation to purchase power on behalf of its residents and small businesses, these individuals may opt out. If AB 2145 passes, all potential participants would have to opt in. It effectively shields the monopoly utilities from competition, requiring a yet-to-be-operational local utility to spend thousands of dollars to attract customers before it sells a single kilowatt-hour. Furthermore, it would make energy procurement nearly impossible for the local utility, which would be unable to effectively plan and purchase power without a reasonable estimate of their market share.
This is the 23rd edition of Local Energy Rules, an ILSR podcast with Senior Researcher John Farrell that shares powerful stories of successful local renewable energy and exposes the policy and practical barriers to its expansion. Other than his immediate family, the audience is primarily researchers, grassroots organizers, and grasstops policy wonks who want vivid examples of how local renewable energy can power local economies. It is published twice monthly, on 1st and 3rd Thursday. Click to subscribe to the podcast: iTunes or RSS/XML
Thanks to ILSR intern Jake Rounds for his audio editing of this podcast.