Trio of cities moves forward with North County CCE

REGION — San Diego’s Community Choice Energy (CCE) movement is in full swing, with cities across the region either exploring or moving forward with city-run energy procurement.

Community Choice is a way for cities and other governmental agencies to not only harness their own energy but dictate their energy portfolio. This often means providing access to cleaner and greener energy, depending on a city’s priorities or climate action goals.

Solana Beach is already there — providing 50% renewable energy and 75% carbon-free energy to its residents through San Diego County’s first CCE, Solana Energy Alliance. The city currently offers a 3% rate discount from San Diego Gas & Electric, the region’s investor-owned utility.

And now the rest of North County is following suit. Del Mar, Carlsbad and Solana Beach are all pursuing a multi-agency “Partner” CCE, referred to as a Joint Powers Authority (JPA).

JPAs allow cities to purchase their power supply wholesale and distribute overhead costs, particularly when it comes to call centers and billing services.

The trio of North County cities are aiming for the JPA middle ground, to help alleviate costs but also maintain local control and the element of “choice” so integral to the idea of community choice energy.

Many details are still up in the air, with a soon-to-be-formed governing board to come to terms with its precise renewable energy portfolio and the CCE’s long-term goals. The “Partner” JPA is aiming for a 2% rate discount from SDG&E, with at least 50% renewable energy.

Pre-launch costs are estimated at about $1.25 million, to be split between the partnering cities. Solana Beach City Manager Greg Wade reported that the three-party JPA could yield a “ballpark” net cumulative revenue of $20.5 million by 2023.

The county may be joining in as well, with the County Board of Supervisors voting 3-2 on Sept. 10 to negotiate a JPA with Carlsbad and the other participating cities.

Some have been hesitant about moving forward, citing potential risks. County Supervisors Jim Desmond and Kristin Gaspar voted against joining a CCE. Gaspar represents District 3, which encompasses a large swath of both coastal and inland North County.

“There are two important takeaways from our action,” said Gaspar in a statement to The Coast News. “First, we are not creating any new energy and second, the projected savings to customers is negligible. I have maintained an open mind, but the data simply isn’t there to support the county entering the energy business.”

Terry Sinnott, a former Del Mar city councilman, encouraged the City Council to pause before pursuing a novel enterprise, perhaps waiting three years to avoid “the early risks.”

Pending a formal JPA agreement, agencies are planning to submit their implementation plan to the state’s Public Utilities Commission for approval by the end of 2019. This would allow the JPA to be up and running in 2021.

Simultaneously, the city of San Diego may soon be exploring a Joint Powers Authority with the cities of Encinitas, La Mesa, and Chula Vista —  with others interested in joining in.

Encinitas was originally aligned to join the North County “Partner” JPA, after Del Mar, Encinitas, Carlsbad and Oceanside pursued a feasibility study to assess the potential costs and revenue associated with bringing a CCE to the region. However, Encinitas voted to partner with the city of San Diego.

In recent weeks, Del Mar and Solana Beach have weighed the merits of joining a CCE with the city of San Diego (“regional CCA”), versus a CCE with other North County cities (“partner CCA”).

Officials in both cities —  the two smallest in the county —  cited concerns over the city of San Diego’s weighted vote. In the regional CCE, San Diego would hold a greater sway on the CCE’s governing board than other member cities. A North County JPA would allow each city to have one vote —  regardless of size.

Carlsbad Councilwoman Cori Schumacher said the one-city/one-vote structure would help give ratepayers “the sense they’re going to be able to control their energy future, because their elected officials are going to be serving on the board.”

Officials in Del Mar were hesitant about linking up with the city of San Diego, the potential “gorilla in the room,” as Councilman Dwight Worden put it.

“I feel comfortable that most likely our long-term interests as a city in Del Mar are going to be better aligned with Solana Beach and Carlsbad than they are with San Diego,” Worden said.

With the region’s cities now taking different routes to government-run energy procurement, the big-picture outcome is still the same: more CCEs in the region and California at large. Area local Lane Sharman, who has been an ardent advocate of CCEs in San Diego for nearly a decade, said “any CCE is better than no CCE.”

“I think we have to support the different ways CCEs can come together in San Diego and ask ourselves how do we achieve our environmental objectives more rapidly as well as maintaining lower costs for our rate payers, and increasing jobs,” Sharman said.