California ‘community choice’ energy program takes a hit

The community choice aggregation (CCA) movement has built considerable momentum in California in recent years. In CCA programs, groups of local government agencies team up to take over decision-making on what sources of power to use in the local electric grid – with utilities continuing to hold responsibility for maintaining the grid. 

CCA advocates contend that not only will this lead to use of more environment-friendly types of energy, it will bring down rates for businesses and households by creating competition for utility companies that often have no rivals. Critics say decisions on what types of energy are used are already mostly dictated by state laws requiring a long-term shift to cleaner renewable energy sources. They also question whether local governments have the necessary expertise for the responsibilities they are taking on.

But since the state’s first CCA, Marin Clean Energy, was launched in Marin County in 2010, the programs have proven popular and kept expanding. Nineteen programs serving 10 million of the state’s 40 million residents have been established.

Last week, however, saw the first major bad news for CCAs in years. The Ventura County Star reported some of the local governments in California’s largest CCA – the Clean Power Alliance – were unhappy enough with the cost of power for street, highway and outdoor lighting that they had opted to return to Southern California Edison to provide that power.

The backlash is limited. The alliance includes Los Angeles County, Ventura County and 30 local cities. The cities of Ventura, Camarillo, Moorpark, Oxnard and Thousand Oaks have taken steps to limit their reliance on the alliance, and at least two other cities are considering the same step. They must give six months notice. 

Edison blamed for defections from Clean Power Alliance

Most member agencies are satisfied, with many choosing to use the 100 percent clean energy option provided by the alliance even if it carries a cost premium of 7 percent to 9 percent. 

Alliance leaders blame the defections on pricing decisions by Edison that they say were attempts to punish their CCA’s members. Edison said all its decisions had been ratified by the state Public Utilities Commission in a transparent process and challenged claims that the utility subsidized some customers at the expense of others.

But as cities are squeezed by the cost of pensions and look to save money wherever they can, the decisions made by Ventura, Camarillo, Moorpark, Oxnard and Thousand Oaks could be copied by other local governments. And while the cities are retaining use of the Ventura-L.A. CCA for most of their energy accounts, the street, highway and outdoor lighting accounts are among the biggest of all in terms of total bills, and thus most coveted by CCAs. 

Nevertheless, the news continues to be mostly bright for CCAs. In February, the San Diego City Council voted to begin negotiating on establishing a CCA with other local governments. San Diego would be the largest city in the nation with a CCA. The cities of Carlsbad, Chula Vista, Del Mar, Encinitas, La Mesa and Oceanside have expressed interest in joining the regional initiative.

Large utilities split on how to deal with CCAs

The decision was made easier by the surprising decision of the giant investor-owned San Diego Gas & Electric utility to welcome a new era in which it runs the regional grid but others choose energy sources. The utility disclosed in November that it hoped for state legislation “that would allow us to begin planning a glide path out the energy procurement space.” Edison and Pacific Gas & Electric have been far cooler to the CCA movement.

In another sign of CCAs’ acceptance as part of the California energy landscape, in May, Moody’s gave Peninsula Clean Energy aninvestment-grade credit rating. Peninsula serves 300,000 accounts in the Bay Area.

Only one other CCA has such a high rating from Moody’s: the Marin program that launched the movement in 2010. It has about 255,000 customers.

Green New Deal Would Cause a New Depression


Solar panelsThe legislation’s title is fitting. The original New Deal failed to create jobs and actually prolonged the Great Depression. This Green New Deal would be no different — it will destroy millions of jobs and push working-class Americans into poverty.

The bill seeks to transition America to nearly 100-percent renewable energy sources. Right now, those sources account for just 11 percent of America’s total energy consumption. To achieve this green future in just a decade, the proposed law would have to create huge subsidies for wind and solar power and place new restrictions on oil and natural gas drilling.

Such subsidies and restrictions have already been tried on much smaller, less ambitious, scales — yet they’ve still failed miserably.

Consider California. Back in 2015, the state passed a bill calling for a transition to 50 percent renewable energy by 2030. The Golden State required power plants to generate more electricity from green energy and lavished millions in subsidies on wind and solar companies.

California consumers are paying the price for those measures. From 2016 to 2017, electricity prices in California “rose three times more than they did in the rest of the United States,” according to policy group Environmental Progress. California now has the highest average electricity prices in the continental United States, according to my recent study from the Pacific Research Institute, a San Francisco-based think tank. The state also has the highest poverty rate and second-highest gas prices nationwide.

This big-government approach to fighting climate change isn’t merely expensive — it’s ineffective. States like West Virginia and Ohio, which haven’t enacted such policies, have actually seen greater emissions declines than the Golden State.

Germany’s renewable-energy push has similarly failed. “An average four-person household has to pay more than double for power in 2017 compared to 2000,” the head of a consumer lobbying group told German radio.

Despite spending billions to phase out fossil fuels and subsidize renewables, Germany is on track to miss both its European Union and national clean energy targets for 2020.

Ontario politicians’ green dreams have also turned into a nightmare for consumers. The Canadian province passed a law promoting green energy in 2009. From 2008 to 2016, electric prices spiked more than 70 percent — prices jumped 15 percent between 2015 and 2016 alone. The provincial legislature recently repealed the law.

The Green New Deal would replicate such failed schemes, but on a much grander scale.

If electricity prices surged here, working-class Americans would be clobbered. The poorest 20 percent of U.S. wage-earners spend nearly 10 percent of their income on electricity, while the richest 20 percent spend around 1 percent.

Fossil-fuels help keep energy bills affordable for working families. Natural gas production has surged roughly 50 percent in the past decade, causing electricity and cooking fuel prices to plummet. This production boom saved the average American family more than $1,300 in 2015.

The oil and gas sector also provides good jobs to working-class Americans. Oil and gas firms support over 10 million jobs across the country — the Green New Deal would eliminate nearly all these positions. By comparison, the Great Recession of 2007 to 2009 eliminated fewer than 9 million jobs.

The Green New Deal is an expensive exercise in futility. Its signature policies have already caused energy prices to soar from California to Canada. Scaling up these failed policies would wreck the U.S. economy and destroy millions of workers’ livelihoods.

This article was originally published by the Pacific Research Institute

Local Energy Programs Are Gaining Popularity


Power electricCommunity-choice energy programs – in which a local government or coalitions of local governments procure electricity and use the infrastructure of existing utilities to distribute it – are growing in popularity across California.

Proponents say government control will lead to cheaper utility rates and faster adoption of renewable energy.

This month, more than 950,000 homes and businesses in Los Angeles and Ventura will shift to a community-choice program – the Clean Power Alliance. It will be the state’s 20th and largest community-choice provider, which will then provide power to nearly 3.6 million customers in the Golden State.

Those numbers could drastically grow in coming years. Both San Diego Mayor Kevin Faulconer and Dianne Jacob, chair of the San Diego County Board of Supervisors, have endorsed community-choice programs. Many other local governments are watching how the programs work in places that have already adopted them.

SDG&E says it welcomes infrastructure-only role

To the surprise of many industry watchers, one of the state’s three giant investor-owned utilities isn’t fighting this development.

After San Diego began taking steps toward a community-choice program last year, San Diego Gas & Electric made clear its interest in getting out of energy procurement. Earlier this month, Kendall Helm, SDG&E’s vice president of energy supply, told the Los Angeles Times that the decision was straightforward.

“We don’t think we should be signing big, long-term contracts for customers that have made a conscious choice to be served by a different” provider, Helm said. “We think our primary role and our primary value is in the safe and reliable delivery of that power.”

Pacific Gas & Electric and Southern California Edison continue to defend the status quo and to work with the California Public Utilities Commission and SDG&E on “exit fees” assessed to departing customers to make sure they help pay for maintaining energy infrastructure. But PG&E, now in bankruptcy and facing possible dissolution by the CPUC because of repeated scandals, has dropped its once-aggressive opposition to the very idea of community-choice energy, including sponsoring a failed state ballot measure on the issue in 2010.

CPUC president fears programs could fail, cause havoc

But California’s most prominent regulator worries that adoption of community-choice’s programs could have huge unintended consequences.

CPUC President Michael Picker told the San Francisco Chronicle last spring that he worries about things going haywire.

“You’re going to have some failures,” Picker said. “Electric markets can be brutal. So what happens to the customers, midyear, if the company or the program goes away? Where do those customers go?”

In a May op-ed in the Sacramento Bee, Picker urged local officials pursuing community-choice to act with care.

“The last time California deregulated electricity, it did so with a plan, however flawed. Now, electricity is being deregulated de facto, through dozens of decisions and legislative actions, without a clear or coordinated plan,” he wrote. “If California policymakers are not careful, we could drift slowly back into another predicament like the energy crisis of 2001.”

Picker warns that managing California’s power grid requires expertise and will become increasingly difficult as new clean-energy mandates kick in and as new technologies come to the fore.

But these warnings so far don’t seem to resonate with the statewide business community, which so far has not taken a strong, consistent stand on community-choice.

Some local groups have, however. The San Diego Regional Chamber of Commerce, for example, questions the assumptions that community-choice will lead to cheaper utility rates and increased use of clean energy.

This article was originally published by CalWatchdog.com

Reduce Wildfire Damage and Lower Energy Bills by Freeing Up Markets

Power electricShortly before wildfires such as the Camp and Woolsey fires ravaged Northern and Southern California, respectively, Gov. Jerry Brown signed a contentious bill making it easier for the state’s investor-owned utilities — primarily, Pacific Gas & Electric, Southern California Edison and San Diego Gas and Electric — to recover wildfire costs from ratepayers, but don’t expect the flames to die down anytime soon.

The legislation arose out of the calamitous wildfires the state has experienced the past couple of years and utilities’ fears about their abilities to cover potentially billions of dollars in damages. PG&E faces a possible $15 billion liability for wildfires that wreaked havoc on Northern California’s wine country last year, and contends that it might be forced into bankruptcy if the California Public Utilities Commission does not allow it to cover the costs with rate increases on consumers. Senate Bill 901, authored by state Sen. Bill Dodd (D-Napa), largely sidestepped the broader reforms Gov. Brown had sought to reduce liability exposure for the utilities.

California law is unusual in that utilities may be held liable for fire damage caused by their equipment even if they were not negligent in maintaining it and followed all safety rules (such as wind blowing a tree down onto power lines and sparking a blaze). SB 901 did, however, direct the CPUC to consider PG&E’s financial status in deciding its liability for the 2017 fires, and may allow the company to pass along costs it cannot financially bear (however that is determined) in the form of bonds to be paid by ratepayers over time.

The legislation also requires utilities to beef up protections of their equipment, and provides some much-needed relaxing of logging restrictions on private land. A greater focus on wildfire prevention efforts such as removing excess fuel through vegetation clearing and controlled burns is also long overdue, and will be funded to the tune of $200 million a year for five years from the state’s cap-and-trade fund. Environmental policies preventing thinning to keep forests in a “natural” state, as well as drought conditions and a bark beetle infestation that have killed millions of trees, have created tinderbox conditions and significantly exacerbated wildfire damage. The money would go a lot farther, though, if the forest-thinning services were competitively bid instead of just doled out to Cal Fire.

In fact, privatization of wildfire services in general would likely substantially reduce costs. Approximately 40 percent of all wildfire services are already provided by the private sector, according to the National Wildfire Suppression Association, which represents more than 250 companies in 27 states employing about 10,000 private firefighters and support personnel.

The state should also stop interfering in insurance markets. An August study prepared for the California Natural Resources Agency by the RAND Corporation and Greenware Tech noted that insurers complain that the California Department of Insurance prevents them from using probabilistic wildfire models to project future losses and has not allowed them to raise homeowners insurance rates high enough to cover the full risk-based cost of policies in high-risk areas, which would discourage building in the most fire-prone locations.

Despite the significant risk to which it exposes investor-owned utilities in the state, strict liability is probably appropriate under the existing regulatory system. It is the same compensatory standard to which governmental agencies are held, and, as the state courts have noted, the eminent domain powers granted to electric utility companies under the Public Utilities Code and the government-protected monopolies under which they operate make them more akin to public agencies than unfettered private companies. Under such a system, where utilities face no competition and property owners cannot opt out if they are targeted for eminent domain action, it makes sense to spread the costs of wildfires among the utilities and their customers, who all share the benefits of the utilities’ electricity generation and transmission infrastructure.

That said, the existing regulatory system is at fault for creating “too big to fail” regional utility monopolies in the first place. A central planning commission that grants monopoly rights and dictates prices and “acceptable” profit levels sounds more characteristic of a socialist or totalitarian state like North Korea or the Soviet Union, but that is the state of energy markets in California.

A better solution would be to open up competition by eliminating regional government-granted energy monopolies with eminent domain powers and treating the provision of electricity like other goods and services. Fully privatizing the energy and insurance markets and eliminating government monopoly protections would do much more to reduce energy costs, increase innovation and reduce losses from wildfire damage than any measures currently being discussed in Sacramento.

esearch fellow at the Oakland based Independent Institute.

This article was originally published by Fox and Hounds Daily

California Becomes First in Nation Mandating Solar Power for New Homes


Solar panelsCalifornia officially became the first state in the nation on Wednesday, Dec. 5 to require homes built in 2020 and later be solar powered.

To a smattering of applause, the California Building Standards Commission voted unanimously to add energy standards approved last May by another panel to the state building code.

Two commissioners and several public speakers lauded the new code as “a historic undertaking” and a model for the nation.

“These provisions really are historic and will be a beacon of light for the rest of the country,” said Kent Sasaki, a structural engineer and one of six commissioners voting for the new energy code. “(It’s) the beginning of substantial improvement in how we produce energy and reduce the consumption of fossil fuels.”

The new provisions are expected to dramatically boost the number of rooftop solar panels in the Golden State. Last year, builders took out permits for more than 115,000 new homes — almost half of them for single-family homes. …

This article was originally published by the Orange County Register

California is following Germany’s Failed Climate Goals


Global WarmingGermany was the first major economy to make a big shift in its energy mix toward low carbon sources, but Germany is failing to meet its climate goals of reducing harmful carbon-dioxide emissions even after spending over $580 billion by 2025 to overhaul its energy systems. Germany’s emissions miss should be a “wake-up” call for governments everywhere.

Germany stepped us as a leader on climate change, by phasing out nuclear, and pioneered a system of subsidies for wind and solar that sparked a global boom in manufacturing those technologies.  

Like Germany, California’s renewables are becoming an increasing share in electricity generation, but at a HIGH COST. The emission reduction goals have increased the costs of electricity and transportation fuels and increased the already high cost of living in California and may be very contributory to California having the highest percentage of homelessness and poverty in the nation.

California households are paying about 40 percent more than the national average for electricity according to 2016 data from the U.S. Energy Information Administration.

Californians continue to pay almost $1.00 more per gallon of fuel than the rest of the country due to a) the state sales tax per gallon which are some of the highest in the country; b) refinery reformatting costs per gallon; c) cap and trade program compliance costs per gallon; d) low-carbon fuel standard program compliance costs per gallon; and e) renewable fuels standard program compliance costs per gallon.

California is an “energy island” to its almost 40 million citizens, bordered between the Pacific Ocean and the Sierra Nevada Mountains. The state’s daily need to support its 145 airports (inclusive of 33 military, 10 major, and more than 100 general aviation) is 13 million gallons a day of aviation fuels. In addition, for the 35 million registered vehicles of which 90 percent are NOT EV’s are consuming DAILY: 10 million gallons a day of diesel and 42 million gallons a day of gasoline.  All that “expensive” fuel is a heavy cost to consumers.

Despite higher energy bills, public opinion has remained supportive of the energy transition and the strategy to cut emissions. That support is apt to shift when politicians resolve the debate about how their targets match reality. Either they will have to abandon the goals and live with more pollution than they’ve promised, or they will have to force through painful and expensive measures that further limit emissions.

Germany, like California, is also trying to phase out nuclear reactors. California has already shutdown the 24/7 nuclear generating facility of SCE’s San Onofre (SONGS) which generated 2,200 megawatts of power that closed in 2013, and will be closing PG&E’s Diablo Canyon’s 2,160 megawatts of power in 2024.

Shutting down nuclear plants is leaving California, like Germany, short of 24/7 generation plants that can work on the breezeless and dark days when wind farms and solar plants won’t provide much to the grid—and demand is at its peak. Yet to be determined is the impact on rate payers? Will there be more reliance in California placed on fossil fuels for 24/7 power?

Germany’s economy, like California’s, is dominated by services that require less energy and produce less carbon than places tilted toward industry and manufacturing. Thus, less emissions to micromanage cost effectively reduce. California is a miniscule contributor to the world’s greenhouse gases. Statistically, the World is generating about 46,000 million metric tons of GHG’s, while California has been generating about 429 million metric tons, which is less than one percent of the world’s contributions. Germany’s contributions are about 905 million metric tons, which is about two percent of the world’s contributions.

Germany’s failed climate goals is an ominous wake-up call for California and governments everywhere struggling to reach their own targets. The result is a puzzle for politicians. Enacted legislation to make sure climate targets are hit, including stringent rules governing energy use, and new building codes to make buildings carbon neutral, and utility bill charges that subsidize investment in green energy, are all resulting in higher energy costs to consumers.

ounder of PTS Staffing Solutions, a technical staffing agency headquartered in Irvine.

This article was originally published by Fox and Hounds Daily

Trump officials open door to fracking in California


fracking oil gasThe Trump administration is starting the process of opening up large swaths of land in California to hydraulic fracturing.

In a notice issued Wednesday to the Federal Register, the Bureau of Land Management (BLM) said it intends to analyze the impact of hydraulic fracturing, known as fracking, on publicly owned land throughout the state.

The area in question spans 400,000 acres of public land and 1.2 million acres of federal mineral estates throughout a number of California counties including Fresno, San Luis Obispo and Santa Barbara.

The notice of intent says BLM will begin the scoping process for a supplemental Environmental Impact Statement, which will determine the effects of fracking on the environment. Fracking is a technology used to release oil and gas from land. The administration’s intent is to eventually open up public land to new lease sales.

The announcement follows a 2017 lawsuit brought by the Center for Biological Diversity. That lawsuit challenged a 2015 attempt by the federal government to finalize a resource management plan that acknowledged fracking. In its settlement, BLM promised that it would first provide an environmental impact statement before considering fracking. …

Click here to read the full article from The Hill

Californians Have Paid Dearly for the Micromanagement of Emissions and Renewable Energy


Wind Turbines Power EnergyLooking back, California’s flagship climate change policy Assembly Bill 32, the Global Warming Initiative was signed into law in 2006 when California was a minuscule contributor to the world’s greenhouse gases. Statistically, the World is generating about 46,000 million metric tons of GHG’s, while California has been generating about 440 million metric tons, which is less than one percent of the world’s contributions.

Today, we’re constantly being bombarded with reminders and progress reports toward achieving California’s plans to reduce greenhouse gas emissions 40% below 1990 levels by 2030, and an 80% reduction from 1990 levels by 2050.

Now, more than a decade since the passage of AB32, California remains as the most environmentally regulated location in the world, yet California still contributes a miniscule one percent, and has had little to no impact on the reduction of global greenhouse gas emissions.

Very often, when our political leaders are confronted with the facts that California is one of the most business unfriendly states in the union, our politicians often reply, “yes, but we’ve got great weather”.  Well, they’re right, California has the best year round weather in the nation and that has lead us to become the 6th largest economy in the world.

With a robust economy, the good news is that we can “afford” to micromanage almost anything, but the bad news is that the costs associated with micromanagement are being born by the rich and poor and has contributed to California having the largest homeless and poverty population percentages in the nation to compliment the robust economy.

California is an “energy island” to its almost 40 million citizens, bordered between the Pacific Ocean and the Sierra Nevada Mountains whose 35 million registered vehicles of which 90 percent are NOT EV’s are consuming DAILY: 10 million gallons a day of diesel and 42 million gallons a day of gasoline.  In addition, the state’s daily need to support its 145 airports (inclusive of 33 military, 10 major, and more than 100 general aviation) is 10 million gallons a day of aviation fuels.

No other State or Country has the stringent environmental regulations as California to keep greenhouse gas emissions in the world to a minimum, thus it’s imperative that California continue to promote in-state manufacturing of the chemicals and by-products, and aviation, diesel and gasoline fuels manufactured from crude oil on the California energy island. All those products from crude oil supports the military and all the California infrastructures, which are the basis of the prosperity of our growing population.

The renewable sectors of wind and solar, like every other infrastructure, are dependent on the products manufactured out of crude oil for all their components so they can produce emission free intermittent electricity.

With all the world’s efforts to protect life, United States wind farms are “legally” killing hundreds of thousands of birds, eagles, hawks, and bats every year, and it’s appalling that society has given the wind industry a FREE get-out-of-jail card!

Bald and golden eagles are not endangered species anymore but are protected under the Bald and Golden Eagle Protection Act and the Migratory Bird Treaty Act. The bald eagle population is growing, while the golden eagle populations is declining.

In 2017, the Obama administration finalized a rule that lets wind-energy companies operate high-speed turbines for up to 30 years — even if means killing or injuring thousands of federally protected bald and golden eagles. Under the new rule, wind farms may acquire an eagle “take” permit from the U.S. Fish and Wildlife Service (USFWS) that allows the site to participate in nationwide killing of up to 4,200 bald eagles annually, under incidental “take” permits without compensatory mitigation. If they exceed their eagle “take”, there are adaptive management measures designed for each project, that often include reducing operational hours if deemed necessary to reduce risk.

It’s appalling that wind farms can legally obtain permits from the USFWS to kill those majestic bald eagles.

The public, especially the homeless and poverty populations that have paid dearly for the micromanagement of our emissions and renewables, deserves to know the costs being incurred to reduce our minuscule contributions to the world’s greenhouse gases, and as a courtesy to provide emission free intermittent electricity, share with the public the total estimated impacts of all birds taken that are reported to the USFWS.

ounder of PTS Staffing Solutions, a technical staffing agency headquartered in Irvine.

California revives 100% carbon-free energy bill


California lawmakers revived a long-stalled proposal on Tuesday to set a goal of generating 100 percent of the state’s energy from carbon-free sources.

With other controversial and high-stakes energy legislation also moving forward, California lawmakers face an array of decisions with vast implications for the Western energy grid, the future of renewable power and consumers’ electric bills.

A state legislative committee sent the 100 percent clean energy bill to the full Assembly, setting up a vote later this year.

The bill’s revival is a tentative victory for its author, Democratic Sen. Kevin de Leon, who is waging an uphill battle to unseat Democratic U.S. Sen. Dianne Feinstein in the November election. …

Click here to read the full article from KCRA News

Solar Panel Mandate Displaces 150,000 Home Buyers


Solar panelsWhile Democrats in the state Legislature and Governor Jerry Brown debate how to spend our state’s budget surplus, they continue to push policies that bust the budgets of ordinary California families.

The California Energy Commission’s mandate that all new homes in California include a minimum $10,000 solar panel system is the latest such attack. With this mandate, the governor’s hand-picked commission has priced out 150,000 California homebuyers.

Why? Because the National Association of Home Builders says that for every $1,000 increase in the price of a home, 15,000 buyers are priced out of the market. So this one action by the Energy Commission will shut out 150,000 Californians from buying a home.

And even that $10,000 is a shameful government fiction. New solar arrays average more than $19,000 in California now, and larger homes could cost double that. California’s “solar tax” could be forcing hundreds of thousands of people into a permanent renter class and barring the door to the American Dream.

With the new gas-tax forcing prices up toward $4 a gallon, “cap-and-trade” taxes pushing electricity rates 50-percent higher than the national average, and the cost of renting or buying a home continuing to spiral out of control, the once Golden State now is home to a quarter of the nation’s homeless population – 134,000 people who can’t afford to have a roof over their heads – solar or not.

This isn’t how our government is supposed to work. Your state and local representative is supposed to figure out ways to make life better for their community, not come up with umpteen-hundred ways to see just how much more money they can pluck from your wallet.

The solar panel mandate is just one more example of the Democrats’ endless experiments in social engineering.

You deserve better than this.

State Senator Ted Gaines represents the people of the 1st Senate District, which includes all or parts of Alpine, El Dorado, Lassen, Modoc, Nevada, Placer, Plumas, Sacramento, Shasta, Sierra and Siskiyou counties. He currently serves as the vice chair of the Senate Insurance and Environmental Quality Committees. He is also a member of the Transportation and Housing and the Governmental Organization Committees.