Santa Monica joins the push for public control of renewable energy

By Bonnie Eslinger

Santa Monica and other cities want to take charge of supplying green energy for residents.  Photo illustration by Michael Kraxenberger, using a photograph  by Jorge M. Vargas Jr. and a painting by Charlotte Vanhaecke.

Santa Monica and other cities want to take charge of supplying green energy for residents.
Photo illustration by Michael Kraxenberger, using a photograph
by Jorge M. Vargas Jr. and a painting by Charlotte Vanhaecke.

Residents of Santa Monica and other Los Angeles County cities may soon be able to bypass private power suppliers and plug into a publicly managed renewable energy network.

Under a public power program currently being explored by local officials, cities would contract with wind, solar, geothermal, hydropower and other green energy producers to provide electricity directly to local homes and businesses.

Called Community Choice Aggregation (CCA), it’s a framework that would largely replace electricity generated by private utilities with renewable energy delivered over the same transmission lines — and possibly at lower prices.

“Typically, it’s an opt-out system. Everybody would be in unless you say, ‘I want to stay with Southern California Edison,’” said Dean Kubani, who heads up the city of Santa Monica’s Office of Sustainability and the Environment.

A state law enabling Community Choice Aggregation was adopted by California lawmakers in 2002, and in the years since a movement toward public power has picked up steam. The Northern California counties of Marin and Sonoma and the city of Lancaster already have programs up and running, and several other counties — including Alameda, Santa Clara and San Mateo — have announced plans to pursue Community Choice Aggregation.

Locally, Santa Monica has aligned itself with a group of South Bay residents and community leaders that began organizing last year around the idea of creating a regional public green power partnership.

Santa Monica Mayor Kevin McKeown said if city staff returns with information confirming that a public power program would be financially feasible and help the city reach its carbon emission reduction goals, he sees nothing preventing his council colleagues from joining him in backing Community Choice Aggregation.

“I suspect it’s going to be unanimous,” McKeown said. “We’ve always been united in matters of sustainability.”

To date, the city councils of Santa Monica, Torrance, Beverly Hills, Carson, Hermosa Beach, Inglewood, Manhattan Beach, Palos Verdes Estates and Redondo Beach have adopted resolutions in support of doing a feasibility study on Community Choice Aggregation — although none were asked to commit funding at this initial stage.

That’s where the Los Angeles County might step in. In March, the county Board of Supervisors passed a motion to explore the potential benefits of Community Choice Aggregation for cities within the county and asked staff to identify up to $150,000 in funding for conducting a feasibility study.

Supervisor Sheila Kuehl, who co-authored the motion with Supervisor Don Knabe, called Community Choice Aggregation a “win-win for rate payers and for our environment.”

“The monthly cost savings and increased use of renewable energy we’re seeing from other counties that have implemented CCA is encouraging, and I’m excited to see how the program can benefit L.A. County,” Kuehl, said.

Howard Choy, the general manager for the Los Angeles County Office of Sustainability, said the cities that passed resolutions in favor of the Community Choice Aggregation “obviously got the board’s attention.”

“This could be a really good program,” he said.

But the Board of Supervisors has not officially greenlighted the study, Choy emphasized. Staff was asked to come back in June with more information on the idea, including a look at other jurisdictions’ experiences in implementing CCA programs and the impact on consumers’ electricity costs.

Nonetheless, growing interest in the potential benefits of renewable energy is propelling Community Choice Aggregation forward.

Last week, local government representatives from across the state met in Los Angeles at the Biltmore Hotel for a CCA forum. The gathering of 200-plus people aimed to provide “the necessary political, energy market, regulatory and technical information,” to consider Community Choice Aggregation and connect local participants with officials from Marin’s and Sonoma’s new power agencies, consultants, wholesale power providers and energy economists.

The event was organized by the state’s Local Government Sustainable Energy Coalition, of which Choy is board chair, and LEAN Energy US, a nonprofit created to support the expansion of CCAs. LEAN Energy US was founded by Shawn Marshall, a former Mill Valley mayor who served on the task force that helped bring about Marin County’s renewable energy program.

Among attendees at the May 18 event was Joe Galliani, the founder of the South Bay group that’s lobbying for a regional public power agency.

Throughout the forum, speakers “repeated the same mantra: ‘There’s never been a better time to start a CCA then right now,’” Galliani said.

The successes in Marin and Sonoma counties, combined with current low costs for renewable energy that can be locked in with wholesale contracts, makes the timing right, said Galliani, a former marketing specialist turned full-time environmental activist.

“Prices are at the sweet spot right now,” Galliani said. “There isn’t a road block here other than having people get up to speed on what a CCA is.”

At this stage, not even Southern California Edison is standing in the way.

California’s law and accompanying regulations from the state’s Public Utilities Commission prevents private utilities from working against any move by municipalities to create a public power program — restrictions created, in part, in response to aggressive lobbying efforts by Pacific Gas & Electric against Community Choice Aggregation in the past.

State law also requires private utilities to deliver the CCA electricity through their transmission and distribution system.

In response to an inquiry about the possible formation of a CCA in Los Angeles County, a Southern California Edison spokesman forwarded a two-sentence company statement: “California law permits cities, counties, or a Joint Powers Authority (JPA) whose governing boards have elected to act as CCAs to purchase and sell electricity on behalf of utility customers within their jurisdictional area(s). SCE’s position is NEUTRAL on CCA programs.”

A municipality or regional coalition in Los Angeles County could have a renewable energy agency ready to provide power to its residents by 2017, proponents say.

“Two years sounds reasonable,” Choy said. “It could be faster.”

There are some potential challenges ahead, he acknowledges, including building the “political will” needed among elected officials and the public to make Community Choice Aggregation happen.

“This is not a no-risk scenario,” Choy said. “You’re an organization that will be in the renewable wholesale power business. But risk can be managed.”

For now, the county’s South Bay and Westside CCA proponents are continuing their efforts to get other cities to sign on to the idea — or at least agree to participate in a feasibility study. They’re pinning their hopes for funding the analysis on the Board of Supervisors vote in June. There’s also grant money that could be chased and the possibility of paying for a study upfront and then wrapping the reimbursement costs into future utility rates.

“Right now we’re looking to the county,” Kubani said.

If the analysis shows a favorable outcome and elected officials with participating cities vote to start a CCA, follow-up steps would include forming a joint powers authority, hiring staff, issuing requests for proposals and negotiating contracts for energy services.

In the end it would be worth it, Kubani said. The Marin and Sonoma county agencies are offering rates that are cheaper than PG&E.

Those prices are based on formulas that include a mix of traditional energy sources and renewable energy sources, according to rates posted on the websites for both agencies.

Marin Clean Energy states that a typical household using PG&E’s current 22% renewable energy plan will pay an average monthly rate of $82.42, but under Marin’s 50% renewable energy plan, that monthly cost drops to $80.98.

Similarly, Sonoma Clean Power states that the monthly residential charge for PG&E’s 28% renewable plan averages about $107.57, but Sonoma’s 33% renewable energy plan costs about $100.52 per month.

But for both Marin and Sonoma counties, the rates for 100% renewable energy would come at a higher cost for residents each month, about $85.61 and $118.02, respectively.

Kubani believes Santa Monica’s residents would be willing to pay extra for energy that came at a lower cost to the planet.

“I think there are lots of people here in Santa Monica that are very environmentally aware and support sustainability,” Kubani said. “I’d certainly pay extra to get 100% green power.”

On Saturday, May 31, Climate Action Santa Monica is hosting a community forum on Community Choice Aggregation from 1:30 to 3:30 p.m. at the Church in Ocean Park, 235 Hill St., Santa Monica. The free event will include presentations from South Bay Clean Power founder Joe Galliani and Lean Energy US founder Shawn Marshall.