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Carlsbad, Encinitas on board with Community Choice Energy

REGION — Community Choice Energy is on the doorstep for Carlsbad and Encinitas.

The two cities, along with Oceanside and Del Mar, agreed to a cost-share feasibility study in 2017. The draft study was released last week during the Encinitas City Council meeting, while Carlsbad received the report on Feb. 26.

Both city councils approved for their respective staffs to explore governance options, while the Carlsbad City Council charged its staff with drawing up a statement of intent to pursue a CCE.

The Oceanside and Del Mar city councils will hear their respective presentations next week.

The draft study, conducted by EES Consulting, reveals a total bill reduction of 2 percent compared to what ratepayers currently pay with San Diego Gas & Electric, should the four cities form a joint powers authority.

When considering a Joint Powers Agreement (JPA), Encinitas Mayor Catherine Blakespear proposed consideration of a weighted vote structure. Photo by James Wang

If each city were to stand alone, Carlsbad and Oceanside could still save 2 percent, while Encinitas would be at 1 percent, but a CCE would not be feasible for Del Mar.

The four cities are holding a public meeting from 6 to 8 p.m. on March 21 at the Senior Center Auditorium, 799 Pine Ave in Carlsbad. The final study will be released in April.

“We’re in the midst of an energy revolution. This is exactly where environmentalism and a strong, sustainable economy merge,” Councilwoman Cori Schumacher said. “We had a speaker … who talked about the San Diego Green New Deal and that is exactly where we need to go,”

Both councils are attempting to move quickly on creating a CCE, which is possible to do before the Jan. 1, 2020, deadline. The cities must have an implementation plan submitted to the California Public Utilities Commission before the deadline to launch a CCE by April or May 2021.

San Diego County also approved moving forward with looking into a CCE.

In addition, SDG&E is attempting to remove itself from buying and selling power, according to numerous reports, city officials and Gary Saleba of EES. Saleba, though, said one of the biggest concerns comes from exit fees and the action of the CPUC and politicians in San Francisco and Sacramento.

“My biggest concern with this, at the end of the day, is the cost,” Carlsbad Mayor Matt Hall said. “We need to be very cautious moving forward with this.”

There are three approaches for the cities for energy sources including SDG&E’s portfolio, 100 percent renewables by 2030 or starting with 100 percent renewables.

The governance options Carlsbad and Encinitas are researching include a stand-alone Joint Powers Agreement (JPA), a three or four-member JPA with Del Mar and Oceanside or join an existing JPA.

During the Feb. 20 Encinitas City Council meeting, Deputy Mayor Jody Hubbard asked whether they should consider three cities without Oceanside, since Oceanside may not be ready to move as fast.

Councilman Joe Mosca said there is not enough information and suggested waiting for the final report to be released before moving on potential JPA partners.

Mosca said the study on governance will also explore how JPAs with other cities, including San Diego, would be laid out with more details giving Encinitas options on how to move forward.

“By 2030, the cumulative surplus of the JPA for the four partner cities would be $111 million,” Mosca said. “That money would be here for us to build local projects in Encinitas, Carlsbad and any of the partner cities. I think there’s a huge incentive there as well.”

Regarding the governance of a JPA, Encinitas Mayor Catherine Blakespear said there are various methods throughout the state worth researching. In addition, she said a weighted vote structure should be considered.

“To me, it seems like the governance model that we will end up choosing is to go with the other cities in the county who are ready to go at the same time we are, which would include the city of San Diego” she added. “I think we do want to have a regional approach. If we can affect other cities and get them to join in and create a county culture, it will have a better effect on carbon reduction.”

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2 comments

Addie February 28, 2019 at 2:41 pm

Sure glad Cori is taking the lead on important issues like this. Also glad she now has support on City Council for forward-thinking ideas that have our future in mind.

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Gregg Ferry March 1, 2019 at 2:42 am

I ask myself, “With $111M, on what projects would the JPA, being formed to buy energy for its constituents, embark?” Why energy projects, of course. There already a lot of incentives for rooftop solar, so what other projects? I can only imagine electric energy storage.

Currently, SDG&E will buy excess solar energy at wholesale rates and sells it at retail rates. This is amazing, because the additional infrastructure costs to SDG&E are $0.00 and rooftop solar INCREASES system reliability while reducing the need for added infrastructure. This comes about because SDG&E is a monopoly. It is a monopoly because this company is to provide a beneficial service to the public, first, in exchange for a guaranteed profit.

In a free market for energy, though, all energy providers could sell their energy to buyers at any agreed price. The infrastructure, provided by an energy distribution company (SDG&E) would be nearly fixed, just as water delivery has a fixed charge. This charge would be about $16/mo (See TOU5 tarriff). Thus, a rooftop solar provider could sell to her neighbor at a competitive price, not 4¢, but $0.20 per kWhr.

Ah, but what happens when the sun goes down? Both the neighbor and the rooftop solar energy provider want energy. It would be a seller’s market. Non-solar providers could pretty much charge what they want, $0.50/kWhr? $1.00/kWhr? In this case, two things will happen.

First, some peole will change their energy usage habits.

Second, entrepreneurs will buy battery storage peaker plants to sell energy during non-solar times. (search “Solar + Storage Half The Cost Of Gas Peaker Plants — 8MinuteEnergy”) Right now, SDG&E buys gas peaker plants for the times when energy is at its highest demand (4PM to 9PM) and charges greater than $0.50/kWhr! Trust me, they make a lot of money doing this; one reason for the decommissioning of the Encina plant and replacing it with peaker plants.

These entrepreneurs would buy energy, even at $0.22/kWhr and sell it back at $0.50/kWhr. You know, “buy low, sell high”. They are quiet (compare an electric car to diesel car). They are relatively small, about the size of a container, so you could put them anywhere. In fact you’d want to put them everywhere, because distributed systems are more robust than point source (power plant) systems.

The challenge is setting up this free market. It would be just like the commodities market. A seller and buyer would contract for a product (electric energy) to be delivered at a certain time for a certain price. If the seller doesn’t have enough, the seller has to buy on the spot market, if the buyer buys too much, the excess is sold on the spot market. Yes, it is complicated, in fact, a little more complicated than I have described. This is where a new job is created, the Energy Advisor, one of the jobs promised in The Green New Deal.

Oh, and everyone can be a stored energy provider, just like everyone can have rooftop solar. Buy a Tesla power wall for $7,000, though, with market incentives like this, cheaper versions will quickly pop up! (see http://www.yiyen.com)

All of the hardware is in place because the buyers already have smart meters. I can guarantee that on the first day the market is open there will be sellers with their energy ready to sell. And just like the New York Stock Exchange is a for profit company, other entrepreneurs will create the San Diego County Energy Exchange. And what a first day that will be!

You will see all of the utility companies and energy giants unleash their most horrific fear mongers because for them, “competition” is the most foul of words. As soon as this proposal is seriously considered, corrupt politicians will be buying up all of the beach front property.

So for what is the need for $111M when Adam Smith will do all the work? For that matter, there wouldn’t be a need for JPA or CCA? Let’s have our council persons, mayors, county supervisors, representatives and governor create the legal framework to ALLOW this to happen.

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