Tuesday, July 29, 2014

Will city move forward on public power review?

From page A1 | April 24, 2014 |

One step forward, one step back. Repeat.

The city’s effort to get information necessary to forge ahead with a plan to provide electricity to Davis residents through a public utility instead of Pacific Gas and Electric Co. has been beset by bouts of caution. Now, the attempt is in limbo — at least for now — after the City Council voted not to hear an update on the issue Tuesday night.

It wasn’t that the council was shy about discussing the topic. The meeting had run long, past 11:30 p.m., and a rule about taking on new business went into effect: Four of five council members had to approve any new topics. Public power didn’t get enough votes, but another, less controversial issue did.

A high-level city meeting on public power involving department heads took place Wednesday afternoon, and a PG&E representative was present. The matter will be discussed at the council’s next meeting on May 13.

What will be discussed is a presentation of municipal utilities and their situations, plus a question posed to the council if it wants to move ahead with the formal information-gathering process.

The city already has spent $400,000 to explore breaking away from PG&E and creating a public power entity. It authorized up to $600,000 more for the study in February, a commitment that is drawing fire from residents who are being asked to approve a half-percent sales tax increase on the June 3 ballot.

The $3.6 million generated annually by that tax would be used to help plug a $4.99 million “structural deficit” in the city budget.

A sprinkling of supporters Tuesday night spoke of the city’s effort to get the information it needs to follow a path to public power. PG&E representatives at the meeting did not do what is by now custom: imply that the effort for public power will be fraught with expense, and that PG&E will fight it every step of the way.

Comments like Davis resident Dean Newberry’s call to the council, “We will win,” go up against a lack of historical evidence for the claim, however.

An Enterprise survey of California municipal utilities using information from the American Public Power Association — a public utility lobbying group in Washington, D.C. — indicates that there is no situation in California that is an accurate comparison to what Davis faces.

Municipal electric utilities that serve entire cities in California are usually much like Palo Alto, Alameda, Burbank and Glendale: long-serving utilities incorporated in the late 1800s or the early 20th century without the court fight or regulatory battle with an investor-owned utility like PG&E.

The South San Joaquin Irrigation District offers a cautionary tale in the modern era. In 2005, it began an effort to purchase PG&E facilities to offer electricity to customers at a projected 15 percent discount. PG&E proved hostile to the effort and still maintains control of its facilities.

The irrigation district’s attempts were rejected by a county agency formation commission in 2006. The district reapplied for another hearing in 2009, but hasn’t heard anything.

A staff report by Herb Niederberger, general manager of utilities, development and operations for the city of Davis, quoted information from the American Public Power Association that seems in contrast to information the association provided the Enterprise.

In a list of 17 public agencies that formed a public electric utility between 2003 and 2013, seven agencies are listed that broke away in California. However, a closer look reveals that none appear similar to Davis.

* Pittsburg Power Company, which does business on former military bases in that city and in Vallejo as Island Power Company, gained its franchise agreement from the military.

* Moreno Valley Electric Utility, which serves just a fraction of its own and Davis’ populations at 4,300 customers, broke away from Southern California Edison in 2004. Interim Davis City Manager Gene Rogers, who started work in Davis on Tuesday, was the city manager of Moreno Valley when he led the push for that utility, according to the Davis city manager’s office.

The Moreno Valley Electric contracts with Enco Utility Services to manage the operations. Of the entire list, Moreno Valley comes closest to Davis’ situation.

* McAllister Ranch Irrigation District, which is listed as breaking away from PG&E in 2003, is listed as being located near Bakersfield. It maintains no website and its number given by several directory websites is disconnected. A different number given by directory assistance rang off the hook, with no message.

* Rancho Cucamonga Municipal Electric Utility broke away from Southern California Edison in 2001 and served its first customers in 2004. The American Public Power Association lists the number of current customers at 400. Its website lists the population of its combined residential and commercial service area in the daytime as 15,000.

* Industry, this industrial-based Southern California city, has an electric utility that broke away from Southern California Edison in 2004, serving 23 industrial customers.

* Port of Stockton Electric is an electric utility serving the Port of Stockton created in 2003. It provides power to an industrial wharf in Stockton. It is listed as having 3,208 customers.

* Victorville, which is listed as breaking away from Southern California Edison in 2003, does not provide electric service to residential customers, according to its website.

— Reach Dave Ryan at dryan@davisenterprise.net or 530-747-8057. Follow him on Twitter at @davewritesnews






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