Sourcing Renewables  -  October 26, 2018

San Diego offers alternative to traditional power utility

Residents of the city of San Diego may soon have an alternative option to their power utility, San Diego Gas & Electric, when it comes to sourcing their electricity. 

The southern California city announced plans for a government-run power program, which would allow smaller public-owned utilities to take over the buying power of private utility companies on behalf of consumers. Under the plan, SDG&E will still be in charge of energy delivery, grid maintenance and customer billing.

Mayor Kevin Faulconer announced the city's intention to form a new joint powers authority to take over purchasing power for San Diego residents in attempts to increase the amount of clean energy being used to power the city.

"I want San Diego to lead this region into a cleaner future," he said in a statement. "This gives consumers a real choice, lowers energy costs for all San Diegans and keeps our city on the cutting edge of environmental protection. We are a city where our environment is central to our quality of life, and community choice will ensure we leave behind a better and cleaner San Diego than the one we inherited."

The plan is meant to reduce monopolies within the energy industry and introduce competition into the market. The city expects the program to be operational by 2022 and to lower electricity rates by up to 5%.

The community choice aggregation alternative was first proposed in 2014 in the city's Climate Action Plan, which states that San Diego must achieve 100% renewable energy by 2035.

Electricity customers will still have the option to continue receiving their power from SDG&E. Under the model, the local government will decide what kind of power the local utilities provide to customers.

"Moreover, the California Public Utilities Commission's recent decision to modify the current exit fee cost allocation mechanisms (PCIA) is designed to minimize the potential for unlawful cost shifts related to past clean energy and systemwide reliability investments that have benefited and continue to support everyone," SDG&E said in a statement in response to the CCA announcement. "State law prohibits the shifting of costs from departing customers (those joining alternative energy programs, such as CCAs) to customers who remain with their traditional utility."

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