Jude Iam
12-22-2009, 06:35 PM
https://www.nytimes.com/2009/12/20/business/energy-environment/20sfpower.html?_r=1&ref=us&pagewanted=all <o:p></o:p>
<o:p> </o:p>
December 20, 2009<o:p></o:p>
New Group Seeks to Bring Greener Power to Marin <o:p></o:p>
By KATHARINE MIESZKOWSKI<o:p></o:p>
<o:p> </o:p>
With holiday lights glowing around Marin County, a debate is heating up from<o:p></o:p>
Belvedere to Novato about who should procure the electricity that keeps them<o:p></o:p>
lighted. <o:p></o:p>
<o:p> </o:p>
A newly formed group, the Marin Energy Authority - whose members include the<o:p></o:p>
county and eight of its cities and towns - plans to approve its first<o:p></o:p>
contract with Shell Energy North America in February and to bring more<o:p></o:p>
renewable power to the county. <o:p></o:p>
<o:p> </o:p>
The Marin group is the leading edge of a movement tailored to this<o:p></o:p>
environmentally conscious age and this environmentally conscious region.<o:p></o:p>
Through a form of public collective purchasing it plans to provide a greener<o:p></o:p>
alternative to the power from the Pacific Gas & Electric Company, Northern<o:p></o:p>
California's dominant utility. <o:p></o:p>
<o:p> </o:p>
The majority of P.G. & E.'s electricity comes from natural gas and nuclear<o:p></o:p>
plants; 14 percent comes from renewable sources like solar and wind power.<o:p></o:p>
The Marin authority has pledged that 25 percent of its electricity would be<o:p></o:p>
derived from renewable sources.<o:p></o:p>
<o:p> </o:p>
It would use lines built, owned and maintained by P.G. & E., which would<o:p></o:p>
also handle the billing.<o:p></o:p>
<o:p> </o:p>
Unless, that is, P.G. & E., which is investor-owned, stops it. At the<o:p></o:p>
moment, it is making every effort to that end, jawboning participants,<o:p></o:p>
hinting at legal action and, most importantly, backing a voter referendum to<o:p></o:p>
nip such plans anywhere in the state. <o:p></o:p>
<o:p> </o:p>
For the utility, efforts like Marin's could hinder a long-term strategic<o:p></o:p>
plan for sustained revenue growth, said William Marcus, an economist with<o:p></o:p>
JBS Energy in West Sacramento who reviewed the group's business plan.<o:p></o:p>
<o:p> </o:p>
Mr. Marcus said that every local effort to buy power independently or to<o:p></o:p>
build local generating capacity eliminated an opportunity for P.G. & E. to<o:p></o:p>
make its own investments in new power generation. Getting financial returns<o:p></o:p>
from new generating capacity is central to the big utility's financial<o:p></o:p>
strategy, he said.<o:p></o:p>
<o:p> </o:p>
Speaking of the Marin effort, Mr. Marcus said: "If these things can be shown<o:p></o:p>
to work and either get cheaper or greener power, then P.G. & E.'s<o:p></o:p>
shareholders are in worse position in terms of building new generating<o:p></o:p>
plants. They make money by owning things." <o:p></o:p>
<o:p> </o:p>
For the backers of the Marin proposal, the fight is about how quickly local<o:p></o:p>
efforts to address climate change can take off. <o:p></o:p>
<o:p> </o:p>
"If successful, these programs will be world leaders in climate action and<o:p></o:p>
green-power development," said Paul Fenn, the chief executive of a San<o:p></o:p>
Francisco-based company, Local Power Inc., who wrote the original 2002<o:p></o:p>
legislation that opened the door for local communities to procure their own<o:p></o:p>
power.<o:p></o:p>
<o:p> </o:p>
"We are the tip of an iceberg," said Dawn Weisz, the interim executive<o:p></o:p>
director of the new group, speaking of the larger movement for<o:p></o:p>
community-controlled power.<o:p></o:p>
<o:p> </o:p>
Being small when looking to buy renewable power, Ms. Weisz said, has<o:p></o:p>
advantages. "We're more nimble," she said. "We're able to enter into new<o:p></o:p>
contracts right now. It's actually a very good time to buy power, because<o:p></o:p>
prices are low."<o:p></o:p>
<o:p> </o:p>
Marin, closely followed by San Francisco, is racing to get its program<o:p></o:p>
established because a statewide initiative, backed by P.G. & E. and likely<o:p></o:p>
to be on the ballot next June could make it much harder to do so.<o:p></o:p>
<o:p> </o:p>
On the national stage, P.G. & E. has developed and nurtured a reputation for<o:p></o:p>
taking a progressive approach to issues involving climate change and<o:p></o:p>
reduction of heat-trapping gases. Peter Darbee, the chief executive,<o:p></o:p>
publicly applauded the signing of California's landmark 2006 legislation to<o:p></o:p>
curb emissions and has been among the corporate executives pushing for some<o:p></o:p>
kind of national cap on emissions. <o:p></o:p>
<o:p> </o:p>
But that is not the same as supporting a proliferation of small local<o:p></o:p>
competitors. In recent years, P.G. & E. has successfully battled local<o:p></o:p>
public power initiatives from San Francisco to Sacramento to Yolo County.<o:p></o:p>
The utility has 2.9 million customers in the nine Bay Area counties,<o:p></o:p>
including 123,405 in Marin. Backers of the Marin authority think they could<o:p></o:p>
attract 100,000 of those.<o:p></o:p>
<o:p> </o:p>
While it is not unusual for investor-owned utilities to fight, case by case,<o:p></o:p>
to keep from losing customers to public competitors, California's initiative<o:p></o:p>
system is a bigger battleground. <o:p></o:p>
<o:p> </o:p>
"This is a very complex business," said Andrew Souvall, a spokesman for P.G.<o:p></o:p>
& E., "and there are a lot of risks associated with being an energy<o:p></o:p>
provider. We believe that taxpayers should have a voice in determining<o:p></o:p>
whether local governments take on that risk."<o:p></o:p>
<o:p> </o:p>
The initiative, known as New Two-Thirds Requirement for Local Public<o:p></o:p>
Electricity Providers, would amend the state's Constitution to require local<o:p></o:p>
governments to win the approval of two-thirds of voters before pursuing<o:p></o:p>
community choice with any public money or bonds. <o:p></o:p>
<o:p> </o:p>
It would also require two-thirds of voters to approve a local government's<o:p></o:p>
use of public money or bonds to start or expand municipal electricity<o:p></o:p>
services.<o:p></o:p>
<o:p> </o:p>
Municipal utilities serve about 22 percent of electricity customers in<o:p></o:p>
California - including in Sacramento, Los Angeles and Santa Clara - for<o:p></o:p>
rates that are, on average, lower than investor-owned utilities.<o:p></o:p>
<o:p> </o:p>
Two weeks ago, a Marin County civil grand jury gave P.G. & E. ammunition in<o:p></o:p>
its fight against the Marin project by issuing a report entitled "Marin<o:p></o:p>
Clean Energy: Pull the Plug." It argued that the proposal was too risky and<o:p></o:p>
should be abandoned. P.G. & E. employees circulated the report by e-mail<o:p></o:p>
days before its official release. <o:p></o:p>
<o:p> </o:p>
On Dec. 15, representatives from the Marin Energy Authority met with<o:p></o:p>
officials in the energy division of the California Public Utilities<o:p></o:p>
Commission. "We talked with the C.P.U.C. to discuss P.G. & E.'s interference<o:p></o:p>
with our power supply contract," Ms. Weisz said, "and general interference<o:p></o:p>
with our process over all." <o:p></o:p>
<o:p> </o:p>
A spokeswoman for the utilities commission confirmed that officials were<o:p></o:p>
evaluating the energy authority's claims.<o:p></o:p>
<o:p> </o:p>
In the meantime, Marin is rushing to get its contract signed and hoping to<o:p></o:p>
avoid a legal challenge. But P.G. & E. is arguing that the contract should<o:p></o:p>
be reviewed under the California Environmental Quality Act, which could<o:p></o:p>
delay it. A lawsuit to force such a review is possible.<o:p></o:p>
<o:p> </o:p>
The Marin proposal offers power customers a choice. Under it, households and<o:p></o:p>
businesses in Marin County - including the cities and towns of Belvedere,<o:p></o:p>
Fairfax, Mill Valley, Ross, San Anselmo, San Rafael, Sausalito and Tiburon -<o:p></o:p>
would automatically receive electricity procured by the Marin Energy<o:p></o:p>
Authority, unless the customers individually opted to stay with P.G. & E. <o:p></o:p>
<o:p> </o:p>
Novato, Larkspur and Corte Madera are not participating in the Marin Energy<o:p></o:p>
Authority, although in Novato local environmental groups and former Mayor<o:p></o:p>
Jim Leland held a public forum on Wednesday to persuade the City Council to<o:p></o:p>
reconsider. <o:p></o:p>
<o:p> </o:p>
Financed with a $540,000 start-up loan from Marin County, the Marin Energy<o:p></o:p>
Authority is trying to raise $1.6 million from foundations and financial<o:p></o:p>
institutions to finance operations from February to July 2010. If the<o:p></o:p>
program gets traction, Marin Clean Energy expects to deliver 170 megawatts<o:p></o:p>
of electricity, for which ratepayers would be charged about $94 million. The<o:p></o:p>
ultimate goal is to develop renewable resources locally.<o:p></o:p>
<o:p> </o:p>
The San Francisco Public Utilities Commission has begun a similar program,<o:p></o:p>
CleanPowerSF. <o:p></o:p>
<o:p> </o:p>
The idea that the Marin Energy Authority's power will be more<o:p></o:p>
environmentally friendly than P.G. & E.'s is challenged by the utility,<o:p></o:p>
which has a national reputation for progressive attitudes on environmental<o:p></o:p>
issues. Speaking of the authority's proposal, Joe Nation, a P.G. & E.<o:p></o:p>
consultant, told the Belvedere City Council last week that "this plan as it<o:p></o:p>
is laid out right now actually increases greenhouse gases." <o:p></o:p>
<o:p> </o:p>
"That's utter nonsense," Supervisor Charles McGlashan, the chairman of the<o:p></o:p>
authority, said in a telephone interview. "It's based on completely flawed<o:p></o:p>
analysis."<o:p></o:p>
<o:p> </o:p>
Meanwhile, the San Francisco Public Utilities Commission requested proposals<o:p></o:p>
from power generators, seeking to buy power - at prices at or below P.G. &<o:p></o:p>
E.'s - for 365,000 customers, with the stipulation that 51 percent come from<o:p></o:p>
renewable energy and energy-efficiency measures at prices at or below P.G. &<o:p></o:p>
E.'s. The deadline for proposals is Dec. 29, and San Francisco hopes<o:p></o:p>
customers can start receiving power from the program by June 30. <o:p></o:p>
<o:p> </o:p>
That assumes that the ballot initiative does not get in the way. Barbara<o:p></o:p>
Hale, assistant general manager for the power enterprise division at the San<o:p></o:p>
Francisco Public Utilities Commission said, "Depending on the outcome of<o:p></o:p>
P.G. & E.'s signature efforts, and any vote that may occur, and where we are<o:p></o:p>
in our implementation of the program, it could have a big impact on us."
<o:p> </o:p>
December 20, 2009<o:p></o:p>
New Group Seeks to Bring Greener Power to Marin <o:p></o:p>
By KATHARINE MIESZKOWSKI<o:p></o:p>
<o:p> </o:p>
With holiday lights glowing around Marin County, a debate is heating up from<o:p></o:p>
Belvedere to Novato about who should procure the electricity that keeps them<o:p></o:p>
lighted. <o:p></o:p>
<o:p> </o:p>
A newly formed group, the Marin Energy Authority - whose members include the<o:p></o:p>
county and eight of its cities and towns - plans to approve its first<o:p></o:p>
contract with Shell Energy North America in February and to bring more<o:p></o:p>
renewable power to the county. <o:p></o:p>
<o:p> </o:p>
The Marin group is the leading edge of a movement tailored to this<o:p></o:p>
environmentally conscious age and this environmentally conscious region.<o:p></o:p>
Through a form of public collective purchasing it plans to provide a greener<o:p></o:p>
alternative to the power from the Pacific Gas & Electric Company, Northern<o:p></o:p>
California's dominant utility. <o:p></o:p>
<o:p> </o:p>
The majority of P.G. & E.'s electricity comes from natural gas and nuclear<o:p></o:p>
plants; 14 percent comes from renewable sources like solar and wind power.<o:p></o:p>
The Marin authority has pledged that 25 percent of its electricity would be<o:p></o:p>
derived from renewable sources.<o:p></o:p>
<o:p> </o:p>
It would use lines built, owned and maintained by P.G. & E., which would<o:p></o:p>
also handle the billing.<o:p></o:p>
<o:p> </o:p>
Unless, that is, P.G. & E., which is investor-owned, stops it. At the<o:p></o:p>
moment, it is making every effort to that end, jawboning participants,<o:p></o:p>
hinting at legal action and, most importantly, backing a voter referendum to<o:p></o:p>
nip such plans anywhere in the state. <o:p></o:p>
<o:p> </o:p>
For the utility, efforts like Marin's could hinder a long-term strategic<o:p></o:p>
plan for sustained revenue growth, said William Marcus, an economist with<o:p></o:p>
JBS Energy in West Sacramento who reviewed the group's business plan.<o:p></o:p>
<o:p> </o:p>
Mr. Marcus said that every local effort to buy power independently or to<o:p></o:p>
build local generating capacity eliminated an opportunity for P.G. & E. to<o:p></o:p>
make its own investments in new power generation. Getting financial returns<o:p></o:p>
from new generating capacity is central to the big utility's financial<o:p></o:p>
strategy, he said.<o:p></o:p>
<o:p> </o:p>
Speaking of the Marin effort, Mr. Marcus said: "If these things can be shown<o:p></o:p>
to work and either get cheaper or greener power, then P.G. & E.'s<o:p></o:p>
shareholders are in worse position in terms of building new generating<o:p></o:p>
plants. They make money by owning things." <o:p></o:p>
<o:p> </o:p>
For the backers of the Marin proposal, the fight is about how quickly local<o:p></o:p>
efforts to address climate change can take off. <o:p></o:p>
<o:p> </o:p>
"If successful, these programs will be world leaders in climate action and<o:p></o:p>
green-power development," said Paul Fenn, the chief executive of a San<o:p></o:p>
Francisco-based company, Local Power Inc., who wrote the original 2002<o:p></o:p>
legislation that opened the door for local communities to procure their own<o:p></o:p>
power.<o:p></o:p>
<o:p> </o:p>
"We are the tip of an iceberg," said Dawn Weisz, the interim executive<o:p></o:p>
director of the new group, speaking of the larger movement for<o:p></o:p>
community-controlled power.<o:p></o:p>
<o:p> </o:p>
Being small when looking to buy renewable power, Ms. Weisz said, has<o:p></o:p>
advantages. "We're more nimble," she said. "We're able to enter into new<o:p></o:p>
contracts right now. It's actually a very good time to buy power, because<o:p></o:p>
prices are low."<o:p></o:p>
<o:p> </o:p>
Marin, closely followed by San Francisco, is racing to get its program<o:p></o:p>
established because a statewide initiative, backed by P.G. & E. and likely<o:p></o:p>
to be on the ballot next June could make it much harder to do so.<o:p></o:p>
<o:p> </o:p>
On the national stage, P.G. & E. has developed and nurtured a reputation for<o:p></o:p>
taking a progressive approach to issues involving climate change and<o:p></o:p>
reduction of heat-trapping gases. Peter Darbee, the chief executive,<o:p></o:p>
publicly applauded the signing of California's landmark 2006 legislation to<o:p></o:p>
curb emissions and has been among the corporate executives pushing for some<o:p></o:p>
kind of national cap on emissions. <o:p></o:p>
<o:p> </o:p>
But that is not the same as supporting a proliferation of small local<o:p></o:p>
competitors. In recent years, P.G. & E. has successfully battled local<o:p></o:p>
public power initiatives from San Francisco to Sacramento to Yolo County.<o:p></o:p>
The utility has 2.9 million customers in the nine Bay Area counties,<o:p></o:p>
including 123,405 in Marin. Backers of the Marin authority think they could<o:p></o:p>
attract 100,000 of those.<o:p></o:p>
<o:p> </o:p>
While it is not unusual for investor-owned utilities to fight, case by case,<o:p></o:p>
to keep from losing customers to public competitors, California's initiative<o:p></o:p>
system is a bigger battleground. <o:p></o:p>
<o:p> </o:p>
"This is a very complex business," said Andrew Souvall, a spokesman for P.G.<o:p></o:p>
& E., "and there are a lot of risks associated with being an energy<o:p></o:p>
provider. We believe that taxpayers should have a voice in determining<o:p></o:p>
whether local governments take on that risk."<o:p></o:p>
<o:p> </o:p>
The initiative, known as New Two-Thirds Requirement for Local Public<o:p></o:p>
Electricity Providers, would amend the state's Constitution to require local<o:p></o:p>
governments to win the approval of two-thirds of voters before pursuing<o:p></o:p>
community choice with any public money or bonds. <o:p></o:p>
<o:p> </o:p>
It would also require two-thirds of voters to approve a local government's<o:p></o:p>
use of public money or bonds to start or expand municipal electricity<o:p></o:p>
services.<o:p></o:p>
<o:p> </o:p>
Municipal utilities serve about 22 percent of electricity customers in<o:p></o:p>
California - including in Sacramento, Los Angeles and Santa Clara - for<o:p></o:p>
rates that are, on average, lower than investor-owned utilities.<o:p></o:p>
<o:p> </o:p>
Two weeks ago, a Marin County civil grand jury gave P.G. & E. ammunition in<o:p></o:p>
its fight against the Marin project by issuing a report entitled "Marin<o:p></o:p>
Clean Energy: Pull the Plug." It argued that the proposal was too risky and<o:p></o:p>
should be abandoned. P.G. & E. employees circulated the report by e-mail<o:p></o:p>
days before its official release. <o:p></o:p>
<o:p> </o:p>
On Dec. 15, representatives from the Marin Energy Authority met with<o:p></o:p>
officials in the energy division of the California Public Utilities<o:p></o:p>
Commission. "We talked with the C.P.U.C. to discuss P.G. & E.'s interference<o:p></o:p>
with our power supply contract," Ms. Weisz said, "and general interference<o:p></o:p>
with our process over all." <o:p></o:p>
<o:p> </o:p>
A spokeswoman for the utilities commission confirmed that officials were<o:p></o:p>
evaluating the energy authority's claims.<o:p></o:p>
<o:p> </o:p>
In the meantime, Marin is rushing to get its contract signed and hoping to<o:p></o:p>
avoid a legal challenge. But P.G. & E. is arguing that the contract should<o:p></o:p>
be reviewed under the California Environmental Quality Act, which could<o:p></o:p>
delay it. A lawsuit to force such a review is possible.<o:p></o:p>
<o:p> </o:p>
The Marin proposal offers power customers a choice. Under it, households and<o:p></o:p>
businesses in Marin County - including the cities and towns of Belvedere,<o:p></o:p>
Fairfax, Mill Valley, Ross, San Anselmo, San Rafael, Sausalito and Tiburon -<o:p></o:p>
would automatically receive electricity procured by the Marin Energy<o:p></o:p>
Authority, unless the customers individually opted to stay with P.G. & E. <o:p></o:p>
<o:p> </o:p>
Novato, Larkspur and Corte Madera are not participating in the Marin Energy<o:p></o:p>
Authority, although in Novato local environmental groups and former Mayor<o:p></o:p>
Jim Leland held a public forum on Wednesday to persuade the City Council to<o:p></o:p>
reconsider. <o:p></o:p>
<o:p> </o:p>
Financed with a $540,000 start-up loan from Marin County, the Marin Energy<o:p></o:p>
Authority is trying to raise $1.6 million from foundations and financial<o:p></o:p>
institutions to finance operations from February to July 2010. If the<o:p></o:p>
program gets traction, Marin Clean Energy expects to deliver 170 megawatts<o:p></o:p>
of electricity, for which ratepayers would be charged about $94 million. The<o:p></o:p>
ultimate goal is to develop renewable resources locally.<o:p></o:p>
<o:p> </o:p>
The San Francisco Public Utilities Commission has begun a similar program,<o:p></o:p>
CleanPowerSF. <o:p></o:p>
<o:p> </o:p>
The idea that the Marin Energy Authority's power will be more<o:p></o:p>
environmentally friendly than P.G. & E.'s is challenged by the utility,<o:p></o:p>
which has a national reputation for progressive attitudes on environmental<o:p></o:p>
issues. Speaking of the authority's proposal, Joe Nation, a P.G. & E.<o:p></o:p>
consultant, told the Belvedere City Council last week that "this plan as it<o:p></o:p>
is laid out right now actually increases greenhouse gases." <o:p></o:p>
<o:p> </o:p>
"That's utter nonsense," Supervisor Charles McGlashan, the chairman of the<o:p></o:p>
authority, said in a telephone interview. "It's based on completely flawed<o:p></o:p>
analysis."<o:p></o:p>
<o:p> </o:p>
Meanwhile, the San Francisco Public Utilities Commission requested proposals<o:p></o:p>
from power generators, seeking to buy power - at prices at or below P.G. &<o:p></o:p>
E.'s - for 365,000 customers, with the stipulation that 51 percent come from<o:p></o:p>
renewable energy and energy-efficiency measures at prices at or below P.G. &<o:p></o:p>
E.'s. The deadline for proposals is Dec. 29, and San Francisco hopes<o:p></o:p>
customers can start receiving power from the program by June 30. <o:p></o:p>
<o:p> </o:p>
That assumes that the ballot initiative does not get in the way. Barbara<o:p></o:p>
Hale, assistant general manager for the power enterprise division at the San<o:p></o:p>
Francisco Public Utilities Commission said, "Depending on the outcome of<o:p></o:p>
P.G. & E.'s signature efforts, and any vote that may occur, and where we are<o:p></o:p>
in our implementation of the program, it could have a big impact on us."