Sonoma Clean Power
The Board of Supervisors have created a Joint Powers Authority that will automatically enroll residents into the program unless they opt-out and replace PG&E as their electricity provider. However, that could change if a new bill in the assembly changes the program to an opt-in program.
New Sonoma is concerned about the risks that come with the new Power Authority and with the County's dismal track record of managing its own finances and risk.
The potential benefits from this Power Authority called Sonoma Clean Power (SCP) are as follows:
- It may encourage self-generation of renewable energy by purchasing energy from local producers
- It may result in economic development resulting in more jobs, assuming renewable energy projects are constructed
- It may provide rebates greater than PG&E to encourage investment in energy efficiency improvements
These potential benefits are minimized by the fact that PG&E is under a state mandate to obtain 33% of its energy from renewable sources by 2020 and PG&E has a new program called the "Green Option" for people who want to purchase all their energy from renewable energy sources.
Sonoma Clean Power Greenwashes Dirty Energy with Energy Certificates, not Real Renewables
Sonoma Clean Power was sold as a way to reduce green-house gas emissions, but they use a feel good scam called renewable energy certificates, pieces of paper that for only one tenth of a cent can magically turn a kilowatt hour of dirty energy into clean energy.
How much do they cost? The average household that uses 500 kilowatt hours of electricity a month can purchase enough renewable energy credits and tell their friends they are 100% renewable and GHG free for a total cost of $.50 per month or $6.00 per year.
Sonoma Clean Power needs to provide residents with the true GHG emissions of their product and advertise itself as greener when and if it becomes greener.
Read our Full Report: Sonoma Clean Power's Green-washing.pdf
Sonoma Clean Power also comes with significant risks:
Procurement Risks: Purchasing the correct amount of energy will be difficult due to the uncertainty in the amount of energy that will be needed and mistakes will be very costly. There is also a future price risk for SCP if it cannot procure power at costs competative with PG&E. Finally, there is uncertainty as to whether SCP can procure energy competative with PG&E rates at the end of the first 3 years of service when they will need to renegotiate contracts with power suppliers.
Customer Cost Risks: There is the potential for SCP rates to become much higher than PG&E rates. And if that happens and SCP customers switch back to PG&E, it could create higher energy costs for SCP's remaining customers.
Customers who opt out of the program will be charged exit fees for leaving SCP and unlike PG&E who can only raise rates after receiving approval from the CPUC, SCP can raise rates at any time.
Assembly Bill 2145, a bill that has been introduced my have a dramatic affect on the number of people who become SCP customers. The bill would change SCP from a program customers are automatically enrolled in to a program they need to opt-in to.
Current financial projections for SCP assume that 80% of customers will become SCP customers but that depends upon SCP being a mandatory opt-out program. If AB 2145 is enacted the opt-in rate will probably be considerably less than 80%. New Sonoma believes the Power Authority should perform an independent survey to determine the number of people that will opt-in to the program and prepare new financial projections using that opt-in rate to determine if SCP is financially viable as an opt-in program.
Lack of Experience Running a Risk-based Business: County personnel have no experience in procuring energy and running a risk-based businesses and if power plants are built, acting as venture capitalists that must select projects from the many seemingly capable promoters. The political influence of local entrenched interests and new outside interests with personal agendas will be enormous and decisions may not be made in the best interest of the ratepayers.
More information on Sonoma Clean Power is available on the White Papers and Articles page.