
San Diego Mayor Kevin Faulconer, shown speaking Sept. 7 at the California Republican convention, is backing a local |
San Diego is poised to join a regional community choice aggregator to take over power procurement responsibilities from San Diego Gas & Electric Co. after the City Council on Sept. 17 voted 7-2 in favor of forming a local government-run energy agency with several nearby cities.
The decision allows San Diego Mayor Kevin Faulconer to execute a joint-powers authority to govern and operate the community choice aggregator, or CCA, tentatively called the San Diego Regional Community Choice Energy Authority, scheduled to launch in 2021. The cities of Chula Vista, Encinitas and La Mesa voted in favor of joining the CCA last week. Another city, Imperial Beach, was scheduled to vote late Sept. 18.
"Community choice is really the culmination of our climate efforts," Faulconer, a Republican and proponent of the government takeover, said at the meeting. The mayor called the formation of a CCA the best way for San Diego to reach its goal of becoming entirely powered by renewable energy by 2035, a full decade ahead of the state's own target to eliminate carbon from its grid.
"We will be able to create our own destiny because we will have full control of where we purchase power from, and it will be clean energy," Faulconer said.
With the move, San Diego joins a sweeping restructuring of California's power sector that has seen cities across the state, primarily in the Pacific Gas and Electric Co. and Southern California Edison Co. service territories, create 19 operating CCAs that already purchase electricity for about 10 million residents.
"Today is the end of the beginning," Bill Baber, a La Mesa City Council member, said at the meeting. The likely formation of the five-city CCA, pending the result of the vote by the City Council of Imperial Beach, is "a monumental achievement," Baber added.
Ahead of its official launch, the CCA must submit an implementation plan to the California Public Utilities Commission. Under state law, electric service customers of investor-owned utilities are automatically enrolled in CCAs when they are formed in their cities or counties, though customers can opt out. Investor-owned utilities continue to bill customers and build and maintain the grid infrastructure that delivers the power CCAs procure.
'We must evolve'
Two San Diego city council members, Republicans Chris Cate and Scott Sherman, voted against the formation of a CCA, citing concerns over the ability of local government to manage the enterprise.
"I can't see a government-run monopoly doing any better than a regulated monopoly," Sherman said ahead of the vote.
Sempra Energy subsidiary San Diego Gas & Electric, which had already signaled its intent to transition to a wires-only utility, supported the city council's decision.
"SDG&E supports our customers' right to create an energy procurement program that best fits their needs," the utility said in an emailed statement, pledging to ensure a smooth transition. "SDG&E recognizes that the energy market in California is changing quickly and that we must evolve as well."
To ensure electric reliability as the CCA model spreads, the utility filed an agreement in late August with community choice aggregators, power plant operators Calpine Corp. and NRG Energy Inc., energy marketer Shell Energy North America (US) LP and other market participants calling for the creation of a new central buyer to plug any potential power gaps.
