After more than a dozen years of political wrangling, CleanPowerSF, also known as San Francisco Community Choice Aggregation, launched last spring, with a goal of enrolling all of Pacific Gas and Electric Company’s current San Francisco customers into the program.
According to San Francisco Public Utilities Commission (SFPUC) public relations officer Amy Sinclair, the initial signup phase focuses on roughly 7,400 commercial electricity users in Districts 5, 8, and 10, as well as about 400 residents throughout the City who’ve expressed interest in enrolling in the program. The “second phase” is slated to begin this fall; to register approximately 48,000 residential customers in Districts 5 and 8. The specifics of subsequent phases haven’t been determined.
“The Potrero Hill and Bayview neighborhoods are portions of the City that have disproportionately been affected by dirty energy from power plants,” said Charles Sheehan, another SFPUC spokesperson. “This is but one reason to launch CleanPowerSF, especially in Districts 5, 8, and 10.”
CleanPowerSF was authorized in 2002 under California Assembly Bill (AB) 117, which enables municipalities to directly sell electricity to their residents. The local utility, in this case PG&E, retains ownership over the distribution system.
According to Sheehan, 27 percent of PG&E’s power is generated through wind, solar, and hydro facilities. Under CleanPowerSF, “our default product, which we call Green, is 35 percent renewable and costs a little less,” he said. Customers can choose a 100 percent renewable energy option, SuperGreen, for about $6 more a month than PG&E power. Sheehan said SFPUC hoped to reduce SuperGreen’s price in the future.
CleanPowerSF charges will replace PG&E costs, excluding distribution and transmission. The utility will continue to send a bill and be responsible for responding to outages. “This year we set a basic default price that’s about 0.25 percent less than PG&E’s,” explained Sheehan. “Our goal is to be priced competitively.”
CleanPower programs are offered in Marin, Napa, Sonoma, and Lancaster. The Marin program has extended to parts of Contra Costa, Solano, and Napa counties. Another 80 California municipalities are considering launching similar initiatives, particularly along the state’s coast, which tend to be progressive and amenable to environmentally-friendly practices.
Under AB 117, customers can opt-out of CleanPowerSF. According to Sheehan, the opt-out rate is presently at one percent. It’s projected to increase, but not substantially.
Eric Brooks, campaign coordinator for grassroots organization Our City San Francisco, has been advocating for CleanPowerSF and other community choice energy programs in California for the last dozen years. He said that automatic enrollment is key to CleanPowerSF’s success, and was one of Mayor Ed Lee’s concerns about the program. Lee had previously protested that customers should be given the choice to opt-in or out of CleanPowerSF. Brooks and other activists insisted that all customers be automatically included from the outset; when people are given options to “change something with no clear benefit, they almost never do.”
Community aggregation was the brainchild of Paul Fenn, an Oakland native and energy consultant for Local Power. As director of the Massachusetts Senate Committee on Energy, he drafted the original “Community Choice” law, Senate 447, in 1994. After Fenn returned to the Bay Area, he wrote AB 117. “I did it without any funding or backing, as an individual, during the energy crisis of the late ‘90s,” Fenn explained. He found a sponsor, former state Assemblywoman Carole Migden, who helped get the bill enacted. Along with the 2001 passage of Proposition H, which permits the issuance of general revenue bonds to finance projects related to renewable energy, AB 117 enabled CleanPower’s launch.
“We decided to go to the Local Agency Formation Commission,” Brooks remembered. “From 2004 to present LAFCO has been key in moving things forward,” including members John Avalos, Cynthia Crews, and Eric Mar. “LAFCO advised the Board of Supervisors on clean energy. It had its own funding for CleanPowerSF, and would fund things we needed, such as when the SFPUC refused to do implementation.”
According to Brooks, Lee stalled implementation of CleanPower by insisting it be 100 percent renewable, thereby making it too expensive. Lee also refused to allow the program to proceed unless there were local hires. “Jobs was our soundbite,” complained Brooks. “We felt we had enough political momentum to hire locally. But Lee said the jobs case hadn’t been proven yet. Unfortunately, he was right; there was no concrete program at the time.”
In 2014, Lee successfully lobbied SFPUC to reject a plan in which Shell Energy North America would provide power to CleanPowerSF. “We went back to LAFCO,” said Brooks, “who conducted its own study, known as the ENERNEX report,” the official title of which was Local Build-out of Energy Resources of the Community Choice Aggregation Program. “This showed that we in fact did not need Shell because the SFPUC was qualified to run the program instead. So LAFCO spent money to do work that the SFPUC was refusing to do and also proved that the program would not be so expensive after all.”
The LAFCO report “showed that we could build out hundreds of megawatts, creating over 9,200 jobs within 10 years,” Brooks asserted, in contrast to previous estimates that suggested 8,100 jobs could be created. “When we saw this reported on the front page of the Chronicle we looked at each other and said ‘We just won!’ because Lee had been touted as the jobs mayor,” said Brooks. The Mayor finally “capitulated, did a 180, and started to support the program.”
While CleanPowerSF is off the ground, Brooks and Fenn are disappointed that the power being sold through the program is generated outside the City, resulting in minimal amounts of new jobs. “The number of jobs CleanPowerSF creates depends upon the scale of the buildout” in San Francisco “and the degree to which it is focused on job-creating components,” Fenn explained. “Compared to development of a wind farm, for example, which creates a jobs boom for a very short period of time – about a year – development of in-city renewables creates many more jobs for many more years. Energy efficiency measures offer by far the greatest number of jobs. In the model which Local Power prepared for SFPUC in 2013, a local buildout of about $1 billion would create 3,000 jobs per year. Another model, which looked at the physical potential for development of renewables on City-owned properties, projected some 10,000 jobs per year. These would be 99 percent private sector jobs.”
“The SFPUC is now claiming that, because of the economics of financing and bond ratings, they can’t build anything substantial until 2020,” said Brooks. “Our job is to push for building more and sooner. You can choose clean power now, but it is all bought somewhere else. We need to start building a lot of stuff right now in order to make for a more viable program. Building our own power would pay itself off after a decade. After that we’d basically have free energy because we wouldn’t have to buy fuel. Power would be 100 percent local and regional.”
Fenn called for “solar photovoltaics installations on about 750 rooftops of medium-scale commercial buildings, multi-residential buildings, and energy-critical buildings, like hospitals and grocery stores,” along with “micro-grids to enable power sharing between City-owned building systems and residents.” Over a ten year period he said 13,500 buildings could be retrofitted with energy efficient improvements, with heat waste capture; and 300 buildings could be subject to large boiler retrofits, all of it financed with no upfront capital costs. Fenn also advocated that “district heat” be installed to serve the Transbay Terminal and surrounding area, wind turbines be erected around the City – “we selected several suitable sites” – and energy storage in the form of electric vehicles and Hetch Hetchy pumped water storage be deployed. “We also looked at developing wave power, tidal power, and other emerging technologies.
“The local buildout Local Power Inc. prepared is a detailed business model for in-City renewables and energy efficiency,” Fenn explained. “The model we developed was based on off-the-shelf technologies. The buildout would result in 51 percent of the entire community’s power supply coming from City-built renewables and efficiency measures. The sites for building would be chosen to enhance energy resilience in San Francisco. Because there are so many renters in San Francisco who cannot currently access state and federal subsidies to own solar, Local Power Inc.’s program design provides for a ‘Community Renewable Shares’ program so any customer – even those without credit, low income, public housing – may sign up to own ‘Community Renewable Shares’ and receive monthly bill credits in solar installations in or near their neighborhoods.”
“I supported Lee’s killing the Shell deal, it was a bad deal,” Fenn continued. “But Lee explicitly said that he wanted a local buildout. I’m not pointing my finger. I’m just talking about holding people to what they say they want. Lee said ‘local buildout,’ and that’s not what this is. It’s not a radical thing. It’s been vetted for over a fifteen year period. Millions of dollars of research has been done on recent data sets. San Francisco ceases to be progressive if it allows any further ball dropping of this process. The whole thing becomes farcical. Then it’s all a sham, which is really subversive. If the board doesn’t do it, there should be a grassroots movement for an ordinance to be included on the ballot. The SFPUC is authorized. The board needs to govern. They’re talking about 2020, but there’s no reason to wait. Until the buildout starts, CleanPowerSF will create few to no jobs in San Francisco except a few dozen new government positions in SFPUC. Local Power’s program design has the City’s Office of Employment and Workforce Development managing job training and placement for residents. The real issue is the SFPUC, and especially the Mayor, need to give strong direction. They seem to suffer from a severe lack of imagination. Currently, the SFPUC has a utility mindset, not a community mindset.”
According to Fenn, proactive public outreach and grassroots support is essential. “A public hearing is needed so residents can understand the position before them. And someone on LAFCO needs to sponsor an ordinance. I was 28 when this started. I’m 50 now!” he laughed. “I feel like Rip Van Winkle, or the dog that won’t let go of the ankle. The phasing in has been too slow. I’ll die young if this doesn’t go through.”
“In San Francisco, our challenge is to build enough of our own power,” said Brooks. “Our goal is for half of our energy to be built locally and regionally.”