New Study Finds Use Of Community Choice Energy Feasible
Switching to an alternative energy program called community choice will help the city of San Diego use more renewable sources of energy and could lower electricity costs, according to a study published this week.
The long-anticipated study—paid for by the city and conducted by the firm Willdan Financial Services—will likely serve as a jumping-off point for arguments in support of and against community choice. The City Council is expected to vote in January on adopting the program.
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San Diego's Climate Action Plan lays out the goal of using 100 percent renewable energy by 2035. The final draft of the feasibility study released Thursday found community choice is one pathway to get there.
Community choice would take the purchasing power away from SDG&E and give it to the city. If the city goes with community choice, the city would still use SDG&E's power grid and electric bills would still come from SDG&E, but the city would decide what energy sources to buy.
The idea is the city could then buy more renewable sources of energy, such as wind and solar power, and less natural gas.
The study found community choice would not only get the city to 100 percent renewable energy by 2035, but also would generally lower electricity costs.
It presented multiple scenarios to show a range of outcomes if the city switches to using community choice:
• At 50 percent renewable energy, community choice's rates would be on average cheaper than SDG&E's by 2024.
• At 80 percent renewable energy, community choice's rates would be on average cheaper than SDG&E's by 2027.
• At 100 percent renewable energy, community choice's rates would not be cheaper than SDG&E's, but the utility has also not outlined a pathway for only using renewable sources of energy.
"The prices are competitive with SDG&E's current prices, which is a good sign," said Cody Hooven, the city's sustainability manager. "It's too early to say yet if people will notice a difference on their bills, but they surely shouldn't see an increase."
She said she's pleased to see the study shows community choice is one option the city can use to reach its renewable energy goals.
But the lobbying arm of SDG&E, called Sempra Services, said conclusions based on the study are too hasty. A spokesperson did not respond to a request for an interview, but said in a statement, "The city’s study is incomplete because it is not possible to determine what a government-controlled energy model will cost customers. Until the true costs and benefits of such a program are transparent and shared with the public, we believe it is premature to move forward."
Haney Hong, the president of the San Diego County Taxpayers Association, also said the study does not examine all the risks of switching to community choice.
"What is the cost of creating another agency, another bureaucracy to implement such a program?" he said. "What protections are there for taxpayers? Could this become an agency where energy bills are used to pay off a burgeoning public pension debt at the city?"
While two members of the Taxpayers Association's board are from SDG&E and its parent company Sempra Energy, Hong said they do not have influence over the association's positions.
"We have a board of about 50, so the last time I checked, two of 50 is a pretty small percentage," he said.
He also said his association is not saying community choice "is good or bad," it just wants to examine the alternatives.
In a statement sent when the study was released, Mayor Kevin Faulconer cheered the results.
"We're moving full speed ahead to reach our ultimate goal of using 100 percent renewable energy citywide, and this study shows we have the ability to get there," he said. "This analysis underscores that San Diego's Climate Action Plan is not only ambitious, it's achievable."
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Environmental groups also celebrated the findings of the study in a press conference Thursday morning.
"Community choice energy is a win for San Diego families," said Alicia Race with the advocacy group Climate Action Campaign. "Community choice will give us lower bills, cleaner air, and the freedom of choice."
At the same time, the city is considering other options for how to reach the 100 percent renewable energy goal. To gather those options, the city recently put out a request for quotes from businesses and organizations to propose how they could help the city use more renewable energy. Eleven entities — including SDG&E — responded to the city's initial request for information, according to a public records act request.
The city will get final proposals from businesses and organizations in July and then review them, along with the community choice feasibility study. It will hold a series of workshops to inform residents about potential energy program changes this fall and then the City Council will vote on whether to go with community choice in January.