“I have known Roy Phillips, founder of REP Energy, Inc., for over eight years. Roy demonstrates a consistent and excellent knowledge of the solar and construction industries, and always operates with integrity and quality on every project.”
– Dave Metcalf, Regional Manager, Kyocera Solar, Inc.
A Message from LEAN’s Executive DirectorHappy Summer Everyone!
We continue to monitor and support City and County investigations of CCA programs which are moving forward all over the state. Some of the big issues right now are management models, sources of upfront financing, and some regulatory nit picks that are, as always, hard to explain but could be important to CCA sustainability. See below for more information on happenings at the CPUC.
The CCA conference in Los Angeles sponsored by LEAN Energy and the Local Government Commission on May 18 was a huge success! Dozens of California communities were represented and we all got a lot of good information and ideas about CCA opportunities and risks. We hope to plan something similar in northern CA so stay tuned for later this fall.
Thanks to those of you who were able to join us for the June 12 LEAN Energy market call! This digest summarizes the topics from that call plus a few other announcements. If you are a LEAN member or considering membership, please join us for our next market call on Friday, July 10th. Please see webinar link on the right to register.
Highlights of CCA Program Developments in California
An increasingly prominent part of the CCA discussion these days is how CCA programs should be managed and by whom. A central part of the conversation focuses on proposals by California Clean Power (CCP), which has been meeting with elected officials in many jurisdictions. In the proposals that have been public, CCP agrees to manage all aspects of the program, assume market risk and provide fixed payments in trade for all program revenues. These terms are appealing to some jurisdictions, especially those that do not have expertise or easy access to capital.
LEAN Energy and others have urged local officials to make sure they get good analysis before they make any decisions to assure program sustainability and head off misunderstandings about risks, costs and relative responsibilities of this new, fully outsourced model. The County of San Mateo recently commissioned an analyses of the model as part of their technical study; the analysis points out both benefits and potential risks of the model. In addition, students at Stanford University recently studied the issue, using the city of Los Altos as a test subject. The presentation slides provide an overview of their presentation.
Many communities in California find it difficult to handle the start-up costs of CCA implementation, even though these costs are recoverable soon after program launch. LEAN has re-engaged the California Infrastructure Bank and help may be on the way!
The California Infrastructure and Economic Development Bank (iBank), a state agency, is eager to work with local communities–especially those with struggling economies–to determine whether they qualify for subsidized loans or credit guarantees for CCA start-up costs.
This is great news for municipalities concerned about financing. Contact Kim Malcolm at LEAN Energy for more information.
Wastewater Utility Finding
A California Appellate Court has just found that a city’s wastewater utility payments to the city for shared infrastructure and employee time was not an improper transfer of funds and did not violate Proposition 218. This has implications for CCAs that may share infrastructure with cities or counties (such as the model underway in Lancaster, CA), or purchase goods and services from them. Read more here.
San Francisco CCA Referendum
The IBEW Local 1245 is sponsoring legislation in San Francisco that would prohibit CCAs from referring to any energy resources as “green” unless they are “Bucket 1″ renewables products or power from the City’s Hetch Hetchy hydro-electric project. The initiative has until July 6th to garner enough signatures for the ballot.
The IBEW’s press release states a concern over the proposed contract with Shell Energy North America (SENA) and the use of unbundled RECs to improve the green attributes of portfolios. Unsurprisingly, the measure does not require similar disclosures by Pacific Gas and Electric Company, although PG&E also purchases RECs and energy supplies from SENA. Because of historic purchases, PG&E is also able to classify some of its unbundled RECs as satisfying “Bucket 1″ resource requirements, when by today’s standards they would be “Bucket 3.”
Some are predicting this local initiative is a warm-up for a statewide ballot measure.
At the CPUC… LEAN Energy, along with CCAs from Marin, Sonoma and Lancaster met in recent weeks with CPUC Commissioners Michael Picker, Liane Randolph and Michael Florio; the meetings with Commissioners Peterman and Sandoval are upcoming. We provided an overview of CCA activity around the state with a message that CCA is no longer a “local experiment” but a valuable — and so far very successful -tool for local governments to meet Climate Action Plan goals without subsidies from local taxes, all of which serve the Governor’s energy policy objectives. A similar meeting with key staff at the Governors Office was also productive in sharing that message and yielded several good ideas and follow up opportunities. We plan to meet with other public officials in the coming month with this important message.
Things move slowly at the CPUC but here are some updates:
Carlsbad Power Purchase Agreement — The CPUC approved SDG&E’s PPA for power from a new gas-fired plant to be built in the San Diego area. It is unclear how this decision may affect the prospects for CCA competitiveness, although many local groups, including the ALJ, argued that the plant is not needed and that the utility should solicit renewable resources instead.
PCIA Vintaging/ERRA(R 14-04-024) — Marin Clean Energy (MCE) and Lancaster Choice Energy (LCE) have opposed PG&E’s proposal to calculate a new “PCIA” exit fee for individual CCA customers as inconsistent with Commission CCA rules.
Residential Rate Design (R 12-06-013) — As we reported in last month’s digest, the CPUC is considering rate design changes that may reduce conservation incentives and impose hardship on customers with inelastic demand. Commissioner Florio has proposed an alternate decision that would soften the blow by developing a time-of-use pilot (rather than a wholesale change immediately) and “flatter” rate tiers than the ALJ proposes.
SCE CARE Rates/PCIA — LEAN, LCE and MCE filed protest letters to SCE’s proposal to impose the PCIA exit fee on low income.
Utility Green Tariffs — Utilities filed proposed tariffs in May for rates expected to go into effect by the end of the year. MCE filed a protest, proposing that utility bills of green tariff customers should show the PCIA as CCA customer bills do.
At the California Legislature:
SB 350 (deLeon and Leno) — The Senate passed the bill, which is expected to go to the Assembly this month. MCE’s concerns about CCA customers being billed twice for renewable capacity may have to be hashed out in CPUC proceedings.
AB 674 (Mullin) — This bill, which would have reduced non-bypassablecharges applied to IOU customers who install clean renewable technologies, died in committee.
AB 802 (Williams) — Would require that cost-effectiveness tests for energy efficiency be applied to all savings, not just those realized for energy efficiency improvements beyond code requirements (MCE support).
*SB 286 (Hertzberg) — Would raise the cap for Direct Access. Recent committee redraft requires new resources to be all Category 1 renewable. Goes to Senate floor next.
If you would like more information or want to join our regulatory and legislative alliances, please contact Kim Malcolm firstname.lastname@example.org
A controversial proposal to raise electricity rates for most Californians would “give a really big break” to the state’s wealthiest communities, top utilities regulator Mike Florio said.
Southern California Edison and other utility companies are pushing major changes that would raise prices for those who use the least and lower prices for those who use the most. Critics have slammed the proposal, saying it would harm low-income households and reduce the incentive for high-income households to invest in solar and energy efficiency.
Edison, Pacific Gas & Electric and San Diego Gas & Electric have defended their proposal, arguing that current rates unfairly penalize high-usage customers. Their planhas the backing of Michael Picker, president of the California Public Utilities Commission.
Florio, who also serves on the five-member commission, sees things differently.
Under Florio’s alternate proposal, electricity rates would still rise for low-usage customers and drop for high-usage customers. But neither change would be as dramatic as utility companies have proposed.
“I see it as only a very minor difference from that which we have today,” said Russ Garwacki, Edison’s director of pricing design and research.
The Desert Sun discussed the potential changes this week with Florio and Garwacki. Here’s a breakdown of what they had to say about four of the most important issues being debated: fairness, fixed charges, time-varying rates and impacts on conservation and solar.
Edison’s residential customers currently pay for electricity in four tiers, with rates rising as energy users cross the threshold into each tier. The first block of energy doesn’t cost very much, per unit of energy; the second block is more expensive. The third block costs even more, and the fourth block costs the most.
The difference between the first and fourth tiers is stark. Under Edison’s current rates, energy use in the fourth tier costs more than twice as much as energy use in the first tier.
Utility officials say that difference is fundamentally unfair.
High-usage customers, they argue, are paying more than their fair share to maintain the electric grid, while low-usage customers are paying less than their fair share. Edison estimates that its high-usage customers are “subsidizing” its low-usage customers by more than $600 million per year.
Under commission president Picker’s proposal, the number of tiers would eventually be reduced from four to two, with a price difference of just 20 percent between the two tiers.
“When we start talking about rate fairness, I think that’s something that’s universally acknowledged as a good thing — customers should pay their fair share,” Garwacki said. “They shouldn’t pay subsidies.”
California’s current rates are a product of the 2001 energy crisis, which saw rolling blackouts cripple the state and the utility industry teeter on the brink of collapse. To keep Edison and other utility companies afloat, state officials approved huge rate increases — in such a way that high-usage customers would permanently bear the brunt of any new costs going forward.
Today, that crisis-driven rate structure is outdated, Garwacki said. Over the past 15 years, he said, high-usage customers have paid more than their fair share for grid maintenance, clean energy, and other changes that have nothing to do with the energy crisis.
“Once somebody gets a subsidy, most people don’t want to give it up,” Garwacki said. “That’s why some people will say the bill impacts are unfair as a result of this proposed decision.”
Florio agrees there’s too big a gap between what high-usage customers and low-usage customers pay. He just thinks Edison’s plan is much too extreme.
Picker’s proposal would raise rates for 85 to 90 percent of Californians, often by as much as $15 to $20 per month, Florio said. That plan wouldn’t increase the utilities’ revenue because some customers would save money. But almost all of the savings, Florio said, would go to the highest-usage customers — who also tend to be the wealthiest.
“The current rates do need to change, but this is a very dramatic shift,” Florio said. “It’s really going have a negative impact on a lot of people.”
Under Florio’s proposal, the number of tiers would drop from four to three. Electricity use in the third tier would ultimately cost about 77 percent more than electricity use in the first tier.
“We should protect small users, who tend to be lower-income,” Florio said.
Garwacki pushed back against that argument, noting that about a third of Edison’s customers are enrolled in the California Alternate Rates for Energy program, which provides discounts for low-income customers. He also said many high-usage customers are large families with little room to cut back.
“It’s no secret that as households have more occupants, that drives a lot of the electricity that they use,” Garwacki said. “It’s a bit of a misnomer to think that just because a customer is high-usage that that necessarily means they’re high-income.”
Asked to respond to that argument, Florio pointed to a well-established link between income and energy use.
“I’ve looked at where those largest users live, and it’s the rich communities around the state. It’s not the middle class, as the utilities have tried to spin it,” he said.
Conservation and solar
Critics charge that the utilities’ plan would discourage conservation, energy efficiency and rooftop solar. That’s because it would make electricity less expensive for those who use the most — in other words, critics say, the people who can most afford to invest in efficiency and solar.
Rooftop solar systems could take two to four years longer to pay for themselves under Picker’s proposed changes, according to the California Solar Energy Industries Association. Similarly, investments in energy efficiency would take longer to pay off for some customers.
Edison officials say their proposal would have little to no impact on energy efficiency and solar.
Even under Picker’s proposal, Garwacki said, California would still have some of the highest electricity rates in the nation. Rooftop solar prices, he noted, continue to drop, and Edison will still offer incentives to buy energy-efficient air conditioners, refrigerators and other appliances.
While the changes might result in slightly less incentive for high-usage customers to conserve, they would also increase the incentive for low-income customers to use less energy, Garwacki said.
“It’s important that all customers receive a fair price signal, so they can make a fair and correct energy-efficiency investment,” he said. “You have low-income customers who have no incentive to conserve.”
Florio doesn’t buy that argument. The utilities’ proposal, he said, “reflects their longstanding ambivalence about energy efficiency,” and is motivated in part by a fear of “solar companies taking away their business.”
It’s important to balance the need for conservation and solar with fairness for high-usage customers, Florio said. But he believes the utilities’ proposal strikes the wrong balance.
“Based on my experience, it just seemed like three tiers, each a third higher than the other, was a kind of place that was a good compromise,” Florio said. “There’s no science to that. It’s a judgment call.”
Ratepayer advocates have also criticized the utilities’ proposal to add a fixed monthly charge of $10, or $5 for low-income customers enrolled in the California Alternate Rates for Energy program.
The fixed charges, they’ve argued, would essentially be a regressive tax, hitting low-usage customers the hardest. Solar advocates, meanwhile, see the fixed charges as a thinly veiled attempt by Edison and other utilities to bring in some money from solar customers.
“If you can get people to pay you just to be your customer, that’s a pretty good deal,” Florio said. “Any business I know would love to have that.”
Utilities officials have dismissed that argument. Solar customers, they say, benefit from being connected to the grid, even though they don’t pay much for its upkeep. Hence the need for fixed charges.
“It’s important that customers who choose to install solar do so knowing what the true costs and benefits are,” Garwacki said.
Edison has estimated actual fixed costs at about $30 per month, but it’s only proposed to charge $10. All other customer classes, Garwacki noted — including businesses — pay some kind of fixed charge.
“It’s very strange that we would single out residential customers, and say that it doesn’t make sense for this group of customers,” he said.
Commission president Picker has proposed phasing in the $10 fixed charge over the next few years. Edison officials have criticized that plan, saying the charges should take effect immediately.
Florio’s proposal would reject fixed charges, instead implementing a $10 minimum bill for most customers, or $5 for California Alternate Rates for Energy customers. The fact that utilities have criticized his proposal, he said, is a sign that their intentions aren’t pure.
“If all they wanted was to collect some money from people who have no or very low usage, a minimum bill would satisfy them,” Florio said. “That’s why I think it’s pretty clear there are other motivations at work.”
Rate tiers and fixed charges are one conversation. “Time-of-use” rates are another conversation entirely.
The idea behind time-varying electricity rates is simple: The cost of electricity changes depending on the time of day and time of year, so we should pay more — or less — depending on when we use energy.
Proponents say time-varying rates would help reduce our dependence on climate-altering fossil fuels. That’s because when demand is highest, Edison and other utilities are forced to buy expensive electricity from “peaker” power plants that wouldn’t otherwise be needed. Those plants are generally inefficient, spewing more air pollutants and planet-warming greenhouse gases than most energy sources.
By charging more for electricity when demand has traditionally been highest, utilities could reduce “peak demand,” limiting the need for peaker plants, proponents say.
Time-varying rates would also give consumers “another way to save,” Florio said, allowing them to reduce their bills by moving energy-intensive activities from peak times to non-peak times.
“You can’t expect people to move everything, but there are things that people can do to save money,” he said. “If you just go ahead and build another plant to meet that peak demand, everybody’s got to pay for it.”
The Utility Reform Network, a ratepayer advocacy group, is worried default time-of-use rates would have unintended consequences. For instance, the group has argued, the new rates could make electricity much more expensive during the summer, hitting desert residents hard during air conditioning season.
Florio said he’s concerned about impacts on desert residents, which is why his proposal doesn’t implement default time-of-use rates for several years.
“I expect we’re going to be doing a lot of analysis between now and 2019,” he said. “If we see that there are going to be adverse impacts, we’ll need to deal with that.”
Southern California Edison officials are somewhat ambivalent about default time-of-use rates.
While the company supports prodding residential customers toward time-varying rates, the transition should be gradual, Garwacki said. Edison doesn’t think customers should be automatically enrolled in the new rates, although that seems like a foregone conclusion now.
What happens next?
It’s unclear how soon the public utilities commission will choose between the dueling electricity rate proposals. The five-member panel could vote as soon as its June 25 meeting in San Francisco.
While Picker’s position is clear, Florio said he doesn’t know how the other three commissioners — Carla Peterman, Liane Randolph and Catherine Sandoval — will vote. It’s possible, he said, that he or Picker will modify their proposals to win support.
“It takes three votes. I’ve said how I would do it if I were king, but I’m not,” Florio said. “I think there will be other options floated, and it’ll take some time to sort this out.”
Sammy Roth writes about energy and water for The Desert Sun. He can be reached at email@example.com, (760) 778-4622 and @Sammy_Roth.
Have an opinion?
Members of the public can tell the California Public Utilities Commission what they think of proposed rate changes by emailing the commission’s public advisor, Karen Miller, at firstname.lastname@example.org. They can also send mail to: CPUC Public Advisor, 505 Van Ness Ave., Room 2103, San Francisco, CA 94102.
Source: California Public Utilities Commission
By the numbers
Right now, Southern California Edison customers pay for electricity in four tiers. Here are the rates:
•Tier 1: 14.9 cents per kilowatt-hour
•Tier 2: 19.3 cents per kWh (30 percent higher than Tier 1)
•Tier 3: 27.9 cents per kWh (87 percent higher than Tier 1)
•Tier 4: 31.9 cents per kWh (114 percent higher than Tier 1)
Michael Picker, president of the California Public Utilities Commission, has proposed collapsing the number of tiers from four to two. Under his plan, electricity use in Tier 2 would cost 20 percent more than electricity use in Tier 1, although actual rates have yet to be determined.
Mike Florio, another member of the public utilities commission, has proposed a three-tiered rate structure. Under his plan, electricity use in Tier 2 would cost 33 percent more than electricity use in Tier 1, and electricity use in Tier 3 would cost 77 percent more than electricity use in Tier 1.
Mortenson announced construction of the Alamo 6 Solar project for OCI Solar Power. Located in Pecos County, Texas, the 110-MWac utility-scale solar project is one of the largest of its kind in the world and will generate enough renewable energy for approximately 60,000 households per year once it’s operational in 2016.
The Alamo 6 project is the 35th utility-scale solar project Mortenson has built in the U.S. and is the fourth Mortenson has built for OCI Solar Power. Mortenson is serving as the full service engineering, procurement and construction (EPC) contractor on the project, while OCI Solar Power is the project developer, owner and operator.
The project utilizes the Sun Action Dual-Axis Tracker system and crystalline modules by Mission Solar. Each tracker contains 42 modules, totaling nearly 430,800 modules for the entire site. Mortenson will employ approximately 250 craft workers during construction.
Alamo 6 Solar Foundations
“The strong growth of solar power and the technological advancements of the industry is amazing,” said Trent Mostaert, vice president and general manager at Mortenson. “The price of utility-scale solar continues to fall and we are seeing increasing grid parity with other energy sources across the U.S.”
According to the U.S. Energy Information Administration, output from solar power facilities around the country more than doubled last year. More than three dozen utility-scale solar projects came online in the first quarter totaling 304 MW of capacity. The U.S. now has more than 11,300 MW of installed, large-scale solar power.
Mortenson is currently ranked as the third largest EPC firm for U.S. utility-scale solar, according to Bloomberg New Energy Finance. The company is also the leading wind energy contractor in North America.
Beach cleanup crew members work to cleanup oil from the beach at Refugio State Beach, Calif., May 22, 2015. The oil spilled into the Pacific Ocean from a broken on-land pipeline impacted the coasts and maritime environment north of Santa Barbara. (U.S. Coast Guard photo by Chief Petty Officer David Mosley)
The pipeline that ruptured on May 19, spilling thousands of gallons of oil into the Pacific Ocean, runs right through Santa Barbara County on its way to refineries in the Central Valley. Yet the county has no regulatory authority over it.
“Our county actually had very strict regulations, but then they lost their jurisdiction over this pipeline,” explained Environmental Defense Center chief counsel Linda Krop during a seaside news conference shortly after the spill. “They were robbed of the ability to monitor this pipeline the last 20 years. The federal regulations are much weaker.”
The company that used to operate the pipeline sued Santa Barbara County in the late 1980s. The oil firm claimed the county didn’t have the authority to impose regulations because the pipeline — now operated by Plains All American Pipeline — crosses county and federal territory.
For example, Santa Barbara County requires major oil pipelines to be outfitted with automatic shutoff valves. Federal regulators do not require them, so the Plains pipeline didn’t have one.
But the feds do require pipeline operators to undergo regular inspections. Those can include everything from looking for surface erosion on pipes to drug testing of workers. A company may also have its own internal inspection schedule.
The Plains All American pipeline is on a five-year federal inspection cycle. That’s about standard, says John Stoody, from the Association of Oil Pipelines, an industry trade group based in Washington, D.C.
“A minimum of every five years the operator must evaluate that pipeline, consider the different threats, conduct inspections,” says Stoody. “And then based on the risks, go out and perform maintenance on those pipelines before they become a problem.”
The inspection process is kind of like getting a smog check for your car. A pipeline operator hires a private inspection firm that specializes in that kind of thing. Technicians then runs the pipeline through a battery of tests and submits the results to the pipeline boss, who then hands over the data to government regulators.
“On top of that, you will have regulators, whether it’s the federal government or a state agency that comes out and inspects an operator, inspects the pipeline, their paperwork for the integrity, the safe operation,” Stoody says
The state of California has a pipeline inspection team, too. It’s a branch of the state fire agency Cal Fire. But the team is small, just a handful of inspectors and engineers.
They share oversight duties with federal inspectors on some 5,000 miles of pipelines across California.
Gorham says that because his staff is so small, inspections are prioritized based on each pipeline operator’s overall track record.
“And we work very closely with the federal government on the pipeline to try and determine what type of inspections and who to inspect,” he says.
Until a couple years ago, Gorham’s crew also had primary oversight of the Plains pipeline that ruptured and sullied the Santa Barbara County coastline.
But because of that staffing shortage, inspection duties on that and hundreds of miles of other pipelines were turned over to federal regulators a couple of years ago.
“And that is a problem nationwide,” says Samya Lutz, of the oil industry watchdog group the Pipeline Safety Trust. “Often the federal government or states will train pipeline inspectors. And once they’re trained up, they might just stay for a year or two before they’re picked off by the industry. Because the industry can typically afford to pay a lot more for those types of jobs.”
But starting salaries for state pipeline inspectors and engineers are set to increase this summer, says Gorham. His department, with field offices in Bakersfield and in the Long Beach area, aims to add about half a dozen additional engineers and inspectors in the coming months.
And California could reclaim pipeline oversight duties that it was forced to hand over over to federal regulators.
Steven is the California Report’s Los Angeles bureau chief. He reports on an array of issues across the Southland, from immigration and regional politics to religion, the performing arts and pop culture. Prior to joining KQED in 2012, Steven covered Inland southern California for KPCC in Pasadena. He also helped establish the first newsroom at KUT in Austin, Texas where he was a general assignment reporter. Steven has received numerous awards for his reporting including an RTNDA Edward R. Murrow Award for investigative reporting in addition to awards from the LA Press Club, the Associated Press and the Society for Professional Journalists. Steven grew up in and around San Francisco and now lives in Pasadena just a short jog from the foot of the San Gabriel Mountains.
The state is investigating a Pacific Gas & Electric Co. safety program — a probe initiated after a member of Congress flagged a potential “safety threat that could lead to explosions,” KQED has learned.
The probe by the California Public Utilities Commission concerns “cross bores,” which occur when an underground natural gas line pierces another utility line — usually a sewer line — below the soil surface. Cross bores can result when work crews use an installation technique that doesn’t involve digging a trench, which means they can’t see whether pipeline damage has occurred.
These unintended pipe intersections might go undetected for years without causing a problem. But some Bay Area cities have recently partnered with utility companies to launch repair efforts out of concern that they are dangerous.
“There’s always the risk for gas explosions,” said Tyrone Jue, a spokesman for the San Francisco Public Utilities Commission, when asked about the safety hazard. “The [sewer] laterals would act like a vent, such that if there was a gas leak on that line, the gas could go up that lateral,” potentially traveling into a home or office space.
This could happen if a line was damaged, triggering a gas leak.
There have been 18 accidents resulting from cross-boring in the United States since 2002, according to the Gas Technology Institute. Mike Bruce, president of the Cross Bore Safety Association, said that’s likely “an understated number.”
“You should be concerned, but not irrationally concerned because this is a fixable problem,” said Bruce. “It’s going to take many years to get this done, because we’ve spent decades putting them in.”
Congresswoman Flags Safety Issue
In July 2014, Rep. Jackie Speier contacted the CPUC, flagging potential “deficiencies” in a PG&E program created to identify and repair cross bores. An email reference to her letter was buried among more than 65,000 emails included in some 123,000 documents PG&E was forced to release due to a lawsuit after the fatal 2010 pipeline explosion in San Bruno.
Performed by utility contractors, PG&E’s cross-bore safety program entailed reaching out to individual property owners and running cameras through underground pipes, to be followed by any needed repairs.
Speier (D-San Mateo) confirmed to KQED that she had contacted the CPUC Safety and Enforcement Division.
“Allegations were brought to my attention that testing was sometimes done by unqualified personnel, that test results from some addresses may have been falsified or addresses slated for testing were eliminated without supporting evidence,” Speier explained in an email to KQED. “These allegations suggested that deficiencies in the program were potentially a safety threat that could lead to explosions.”
Emails in July 2014 between a CPUC Safety and Enforcement Division official and PG&E — in response to Speier’s concerns –indicated that a CPUC investigator would be initiating contact with the utility. But the findings of this probe have yet to be disclosed.
Speier’s letter to the CPUC contained an excerpt from a June 17, 2013, email between apparent contractors that had been shared with her office.
“There are a large number of addresses with potential cross bores [that were] never inspected,” says the excerpted email cited in Speier’s letter.
The unnamed author requests PG&E involvement, noting, “I just don’t want to be asked the question of why an assigned address wasn’t inspected AFTER a cross bore in an uninspected address blows up. This is a very real and dangerous potential; in my humble perspective as an inspector in this program.”
The “large number of addresses” referenced in the June 2013 email provided by the whistleblower were slated for inspection in 2012.
CPUC spokeswoman Constance Gordon told KQED that the state investigation began in July 2014. “Whistleblower complaints are always screened for immediate safety concerns and then assigned to an investigator, in this case in our Safety and Enforcement Division,” she said. “The investigation includes fact-gathering, code compliance and sufficient corrective actions as warranted by the specific case.”
She added: “We cannot comment further until the investigation is completed.”
PG&E responded to calls with a written statement saying that: “As part of our commitment to the safety of our customers and the communities we serve, PG&E has deployed a comprehensive program to prevent, identify and repair cross bores throughout our natural gas system. We hold our employees and contractors to high standards and maintain a rigorous quality control process for this work. We are committed to cooperating fully with any reviews by our regulators.”
PG&E is facing criminal negligence charges for violating pipeline safety laws and obstructing justice in the case of the San Bruno transmission pipeline explosion, which killed eight people and destroyed 38 homes in September 2010. And two related investigations, one federal and state, focus on alleged improper communications with utility executives.
Cross-Bore Explosions Can Be Deadly
On Aug. 29, 1976, an explosion and fire destroyed a house in Kenosha, Wisconsin, killing Cletus Weston, 60, and his son, David, 26. Four other people were injured and two adjacent houses were also damaged.
Earlier that morning the Weston family had called a sewer cleaning company to remove a blockage. The cleaner inserted an auger into a 6-inch sewer lateral. But the auger struck and ruptured a 2-inch plastic gas main, even though the home was not served by natural gas. Quickly, gas flowed into the house through the sewer system and an explosion occurred.
Later, the National Transportation Safety Board disclosed that the gas main had been installed by boring through the sewer lateral — a cross bore. The explosion prompted the NTSB to issue a series of recommendations, including that “inspections [should be made] …. where gas mains and sewer laterals may be in proximity.”
But it took decades, and more explosions, for many municipalities and utilities to begin searching for cross bores.
Cross Bores Discovered In Bay Area
According to documents from PG&E, there have been five “near hits” in San Francisco and the Peninsula since 2012 in which cross bores were damaged and gas was released. But they were fixed before any property damage occurred.
Workers found 24 cross bores within four city blocks in Palo Alto, according to a document cited by PG&E and presented at the Northeast Gas Association. The City Council approved $3.8 million in 2011 to inspect sewer laterals and make repairs.
In San Francisco, Tyrone Jue noted that the SFPUC, the agency tasked with maintaining city sewer lines, was largely unaware of cross bores until its street crews uncovered them during routine maintenance.
“[PG&E] had been doing the trenchless pipeline installation for a while, prior to us finding out about it,” he said.
PG&E later provided data suggesting that there were about 1,000 locations in the city where cross bores had occurred.
But a complaint filed against PG&E by San Francisco City Attorney Dennis Herrera suggests that there could be even more. “PG&E has identified thousands of additional locations where PG&E’s cross-bores might have caused damage to city sewer laterals,” Herrera’s June 6, 2013, complaint noted.
Both Jue and Deputy City Attorney Theresa Mueller assured KQED that the problem was in the process of being addressed, both through a formal agreement between the city and the utility and through repairs, performed either by PG&E or SFPUC.
“A vast majority of them have already been fixed,” Jue explained. However, “There are some that are still remaining.” Meanwhile, cost recovery for damage to sewer lines is still the subject of litigation.
The city made repairs to nearly 100 locations where sewer pipes were damaged by gas lines, incurring more than $1.2 million in costs.
Efforts to Raise Awareness About Cross Bores
PG&E has issued tens of thousands of brochures to sewer districts, public works agencies, plumbers and equipment rental stores to raise awareness about cross-bore safety concerns.
Nationwide, public safety programs stress that property owners should be aware of the potential safety hazard caused by cross bores.
“OK, someone’s sewer or toilet is backing up. Normally they just call the plumber. Now they’re saying, call the gas company first to make sure there’s not a cross bore,” said Carl Weimer, executive director of the Pipeline Safety Trust.
Before you or your plumber perform a repair to a sewer line outside of your foundation, call 811.
Palo Alto’s Mayor Youth Video Corp made the video below about cross bores.
Rebecca Bowe is a journalist based in San Francisco. She’s covered Bay Area news since 2009, and previously served as News Editor of the San Francisco Bay Guardian. Follow her on Twitter @ByRebeccaBowe.
With almost no public attention, the California Legislature took a significant step yesterday (May 28) that could help corporations and universities make a complete transition to renewable energy. The Senate Appropriations Committee voted to approve SB 286 with a major amendment requiring that all power sold under the bill to be 100 percent renewable.
Overall, the bill would allow large electricity users to contract with independent power providers through the state’s Direct Access (DA) program, circumventing their local utilities, for an additional statewide total of 8,000 GWh of all-renewable power.
The text of the amended bill isn’t out yet, and I will post it as soon as it’s available. But the staff analysis published online today summarized the new amendment this way: “Require that all additional DA service be from renewable sources as defined in the RPS (Renewable Portfolio Standard) program.”
What does this really mean? No, it isn’t a complete game-changer. But yes, it will be an important addition to the state’s overall strategy. Consider that the extra 8,000 GWh would lead to greenhouse gas reductions equivalent to a 2 percent rise in the RPS, while renewables now comprise about 24 percent of the statewide power mix. Democratic leaders will need all the help they can get to reach their new goal of 50 percent by 2030.
Yesterday’s decision reflects complex legislative maneuvering. The Appropriations vote moved the bill off the committee’s suspense file and sent it to the Senate floor for a full vote. The suspense file is essentially a legislative black hole, in which the fate of all bills in the file is decided by the Senate leadership before the meeting with zero transparency. It’s the proverbial smoke-filled back room. Whether this process is good or bad is not my point here. But the decision to drastically amend SB 286 suggests that the bill was carefully evaluated by the Committee chair, Sen. Ricardo Lara, and his close ally, Senate President Pro Tem Kevin de León, according to its potential impact on de León’s top legislative priority this year: SB 350, his landmark bill on greenhouse gas emissions reduction. Their apparent conclusion was that any new Direct Access should give the maximum boost to SB 350 — i.e. by being all-renewable. The bill’s author, Sen. Robert Hertzberg (D-Los Angeles), had no choice but to go along.
The switch to 100 percent marks a sharp turnaround for Hertzberg. He introduced SB 286 in February as a mostly brown-power bill, supported by a conventional brown-power alliance of industry groups that simply want cheap electricity with only the legal minimum of renewables. It was a largely Republican, pro-deregulation coalition very similar to the backers of the state’s big deregulatory leap in the late 1990s — which crash-landed in the power crisis of 2000-01. The additional power sold under the bill’s initial version would only have to comply with the state’s RPS, which currently mandates about 24 percent renewables. Then in early May, Hertzberg raised the bar to 51 percent renewables after he ran into opposition in the Senate Energy Committee. The new move to 100 percent risks alienating some of the bill’s industry supporters, some of whom quickly indicated that they are unhappy and may withdraw their backing.
So the bill’s politics have changed along with its substance. A much greener support coalition needs to be organized to help push the bill through the remaining Senate and Assembly votes and to persuade Gov. Jerry Brown to sign it. This effort will be a key test of California’s clean-energy companies as well as the environmental organizationsthat have doggedly pushed the state’s tech firms to go green. Until now, California firms that have seen the light on renewables have found it surprisingly hard to green their in-state power sources, as I have written here and here. But if the amended SB 286 can become law, these firms can become real drivers of the state’s clean-energy transition. They will be able to demonstrate their environmental leadership where it counts most — at home in California.
California is the best state in the country if you want to go solar – but only if you’re rich enough. Due to the steep upfront costs of around $15,000, only those from middle- to upper-income families can afford to install solar arrays. A novel initiative is, however, looking to change that. This new project hopes to help disadvantaged communities see the sun in a different light.
Using money raised by the government to help fight global warming, the Grid Alternativesproject aims to get polluting companies to pay for putting solar panels on the roofs of those who cannot afford them. According to the San Francisco Chronicle, the plan is to use the cap-and-trade money raised by the state from companies who have to pay per ton of carbon dioxide emitted. The cost to the disadvantaged families: nothing.
Grid Alternatives has been made project manager of the $162 million Single-family Affordable Solar Homes (SASH) project, the country’s first dedicated solar repayment system for low-income families. They want to install solar arrays to over 1,600 homes by the end of next year. Using job-training programs and donations from solar companies, they aim to keep the costs as low as possible. Whilst it is totally free for the families getting them installed on their houses, they do ask that the families either offer to feed the crew, or help them install the panels.
The state government in California will use $14.7 million raised through the cap-and-trade system, aimed at curbing greenhouse gas emissions, to use toward installing solar arrays. In total, the cap-and-trade system has totted up to an impressive $1.6 billion.
By ploughing at least 10% of this money back into solar, the project aims to kill two birds with one stone – saving lower income families money, whilst also making big fossil fuel polluting companies help cut energy emissions in the state even further.
Anyone who is currently living in a neighborhood in California that is classed as disadvantaged is qualified to apply to get the arrays installed. Grid Alternatives predicts that it could save individual families up to $1,000 a year, which they hope could then be spent on other essentials such as food. The sun sets on the initiative in 2021, so if you’re living in the state, you might want to jump on board soon.
The city of Campbell reportedly was set to deliver a signed resolution to Sunnyvale before April 30 agreeing to participate in a feasibility study for a plan that could bring more choices when bringing power to the city.
Campbell along with the cities and towns of Los Altos, Saratoga, Los Gatos, Milpitas and many others are investigating the possibility of forming a Community Choice Aggregation in the South Bay. Sunnyvale, Cupertino, Mountain View and unincorporated parts of the Santa Clara County are currently partner cities that are discussing the risks, opportunities and costs associated with having new cities join.
The communities formed would have the option to purchase electricity from developers and competitive alternative-energy suppliers. PG&E would still continue to deliver power and customer billing, according to staff’s report. If customers do not want to participate, there is an opt-out option.
Established by law in seven states and authorized by AB 118 in California, CCA’s allow local governments or groups of them to pool the electricity demand of their residential, business and municipal accounts in order to purchase or develop power on their behalf, according to the April 21 city staff report.
CCAs in California typically seek competitive or cheaper electricity rates, consumer choice, reductions in greenhouse gas emissions, new renewable power development, new jobs and energy programs for communities.
If the cities choose to form a CCA, then they will be able to judge their residents’ energy needs and find the right alternative energy source for residents.
According to the city staff report, a study is scheduled for release some time later in May.
“Once the study comes back, then the cities will come together and discuss what the findings are,” Aki Snelling, the city’s planning manager, told the council on April 21.
Snelling added that the cities of Gilroy, Saratoga, Los Altos and Campbell have agreed to participate in the study. Confirmation from Los Gatos had not been announced as of the April 21 meeting.
Two cities currently operate a Community Choice Aggregation: Marin Clean Energy and Sonoma Clean Power.
LAKEPORT, Calif. – On Tuesday the Board of Supervisors is set to consider a contract with a Windsor-based firm to provide a program that would allow the county to save residents money on power costs while increasing the mix of renewable and green power that’s used locally.
The agreement with California Clean Power Corp. is timed for 9:20 a.m. during the board’s meeting on Tuesday in the board chambers on the first floor of the Lake County Courthouse, 255 N. Forbes St., Lakeport.
California Clean Power Corp., http://cacleanpower.com/ , is offering the county community choice aggregation services. Community choice aggregation, which was set up under state law, allows jurisdictions like counties and cities to purchase or generate electricity for businesses and residents, while power continues to be delivered through existing utility systems by investor-owned utilities like Pacific Gas and Electric.
Last week, the board heard a presentation by Peter Rumble, chief executive officer of California Clean Power Corp., on the proposal. The discussion starts two hours and 47 minutes into the video shown above.
He explained that the genesis of community choice aggregation programs was the energy crisis in 2000; the state’s goal was to use community choice to protect communities in a market dominated by PG&E. Rumble said currently there are programs in Sonoma and Marin counties, and the city of Lancaster.
His company was formed after a team of experts – which now composes its leadership – saw a great need for a company to help communities establish their own community choice aggregation programs.
“Community choice is the ability for local communities to control where their energy comes from,” and isn’t about creating generation assets or becoming a power company, he said. “The delivery of power remains exactly the same.”
The transition is seamless, said Rumble. “The only thing you get is lower rates, cleaner power and money that stays in the community.”
His company generated a feasibility report for the county to consider. California Clean Power won’t require the county to go out and get financing for startup costs or ongoing infrastructure operation. He said all of that infrastructure is provided under the proposed public-private partnership.
Rumble said the Board of Supervisors would control the benefits, determine the mix of renewable power and control the revenues that come in from the program. There would need to be at least one annual meeting to set rates.
In Lake County’s case, Rumble said his firm is proposing rates for Lake County residents that would be 2-percent below PG&E’s rates. Those lower rates – set for the life of the proposed 10-year contract – would equate to $750,000 a year in savings, Rumble said.
In addition, the county would get a 33-percent renewable power mix in its energy portfolio, which he said would put it about five years ahead of state mandates to increase renewable power use.
As part of the contract, the county would be guaranteed to receive $2 million annually in revenue, with Rumble explaining that those funds would be unrestricted. In the case of Marin and Sonoma counties, Rumble said they have chosen to channel those funds into energy efficiency program.
If the board approves the contract, Rumble said that beginning this December and into the early months of 2016 his firm would get a program up and running that’s specifically tailored to Lake County’s needs.
Rumble’s firm will oversee the program’s ongoing operation, including regulatory filings, and handle public outreach. “There’s a lot of day-to-day that goes into operating a community choice program.”
He said his firm makes money if it does a good job managing the program. The company takes on the market risk by contractually guaranteeing the county’s benefits.
Even in the worst case scenario – in which California Clean Power goes away – county residents and businesses would simply return to the existing service with PG&E, with no penalties or repercussions, Rumble said. “You really are taking on very, very little risk.”
Board Chair Anthony Farrington said county staff has been working to shape a proposal. He asked what’s not to like about reducing utility rates for ratepayers, moving from fossil fuels to at least 33 percent renewable and green energy, and giving local geothermal and solar sources priority, with the county able to consider doing its own energy project down the line.
He said the $2 million in estimated revenue was “very historic,” adding, “This is a very big, broad, bold vision.”
Supervisor Jim Comstock asked if the power can be purchased from anywhere. Rumble said yes; he added that the county can prioritize purchasing power from local resources and isn’t obligated to purchase it from PG&E.
Supervisor Jim Steele said he was concerned about the proposal moving forward too fast, with not enough public input. “We need a public engagement effort. I would not want to go forward next week.”
He said he saw a conflict of interest with Rumble’s firm completing the feasibility study, with Rumble replying that they worked hard to present an impartial feasibility report. Regarding community engagement, Rumble said his company was happy to move forward in the way the county wanted. “This is really your call, your program.”
Steele said during the discussion that he was taking the stance based on his community outreach efforts. “The board gets criticized a lot for what he public doesn’t understand, and this is a huge change in direction for the county.”
Farrington questioned at what point in time Steele would decide there was enough public outreach, adding the program has been analyzed by county staff and there exists an opt-out component to program for residents who don’t want reduced utility rates.
Steele said the devil is in the details. “This just looks too smooth, that’s all that I’m saying.”
He asked Rumble what outreach effort took place in other counties. Rumble said Sonoma and Marin counties undertook “multiple year” community engagement efforts, but Lancaster’s was much quicker, lasting under a year.
Steele wanted Rumble to commit to a town hall meeting in each of the five supervisorial districts, which Rumble said he would do, but Farrington raised issue with whether there would be such town halls held in districts other than Steele’s.
He said approving the agreement didn’t end public engagement, with Steele replying that public input needed to take place before it came back to the board. “This just seems like the kind of thing that gets us in trouble,” Steele said.
Supervisor Jeff Smith called the proposal a “no-brainer,” adding that his constituents elected him to look for ways to save money whenever possible. As such, he wanted to move forward quickly to prevent his constituents from losing savings.
“We could take everything that comes before us and completely vet it and i don’t think we’d get anything done,” Smith said.
Comstock said he wouldn’t have supported the plan if it meant adding a large number of staff to run the program, and noted that he thought the opt-out provision was “huge.”
Supervisor Rob Brown said the program would allow the county to support Calpine and The Geysers geothermal steamfield by purchasing power from the company.
Brown said he was prepared to move forward. “I don’t want to minimize public input at all, but I’ve also seen how it works just the opposite. we could be here two years from now still having this discussion,” he said, adding he’s not willing to let that happen.
Running a quick calculation based on the projected savings, Brown said Lake County residents and businesses pay $37 million a year for utilities. “I’m not waiting for them to save money. We need to do this as soon as we possibly can.”
Special Districts Administrator Mark Dellinger told the board that he’s been involved with the program review, and he noted that the county government is one of the largest consumers of electricity in Lake County. At the same time, it also owns one of the largest public solar installations.
He said California Clean Power has technical expertise to help the county dig in and look at purchasing its solar facilities, which in turn would allow the county to generate surplus power and make it available locally.
“It’s a significant thing from my perspective,” Dellinger said.
Brown said the program offers an opportunity for county facilities and schools to have further reduced rates, with Farrington adding that there also is the opportunity for the cities of Clearlake and Lakeport to implement similar programs.
Lakeport resident Heather Powers wanted there to be a community engagement process, adding there should be a lot of investigation. Farrington responded that he was comfortable moving forward because of the opt-out option.
Steele said he wanted to hold at least one town hall in his district before moving forward. Farrington asked him about his conflict concerns regarding California Clean Power’s feasibility study.
“Read the feasibility study,” Steele said.
“I did,” Farrington replied.
“We have consultants and contractors come before this board all the time providing their own analysis. You’ve done that,” Farrington said, referring to Steele’s work as a consultant for the county on quagga and zebra mussel prevention before he ran for office.
“I did not come to this county with any proposal. The county came to me and asked me. That’s a difference,” said Steele.
Farrington replied, “How many town hall meeting did we have?”
Steele insisted that the county came to him. “I did not,” Farrington said.
“The hell you didn’t,” said Steele, adding he should ask Water Resources Director Scott De Leon. “He was the one who did. And by the way, I didn’t take any pay for that.”
Comstock asked if residents can opt out at any time, “The short answer is yes,” said Rumble, noting there are some windows for opting in and out based on how the program was set up by the state to work.
Rumble noted during the discussion that the community choice program “is very, very popular, no matter where it’s at.”
County Administrative Officer Matt Perry told the board that the ordinance would need two readings, so the soonest it could be approved was two weeks out – putting final approval possible at the board’s first June meeting.
Brown, Comstock, Farrington and Smith agreed by consensus to have the proposed ordinance brought back for its first reading on Tuesday.
May 9, 2015, by Paul GipeMay 30th Danish wind pioneers are gathering at the Tvind school in northwest Jutland to celebrate the 40th anniversary of the start of construction for the world’s oldest operating wind turbine–Tvindkraft.[more]
May 17, 2015, by Karl-Friedrich LenzIt would work exactly like the successful solar tariff, with one small change. There would be a cap on the fossil fuel electricity bought under the system. That cap would be calculated from the already existing goals for renewable. Look at the renewable goal, subtract that from 100 percent, and you get the cap for fossil fuel under the feed-in tariff.
May 8, 2015, by Alan SimpsonFormer parliamentarian Alan Simpson bemoans the paucity of serious debates of public paucity in the recent British election concluded today. Beginning in Churchillian tones, he laments “What infuriated me most about this general election was that never has so much been missed by so many.”[more]
April 30, 2015, by Craig MorrisSo the auction has just resulted in a large group of losers, a higher price than with feed-in tariffs, and a two-year postponement of the roughly 150 megawatts just awarded.
April 29, 2015, by Craig MorrisIn a nutshell, the UK overpays wind power in particular because big utilities with big expectations for returns run the show, whereas new players and communities have largely driven the German wind sector up to now – and they were more interested in getting the transition moving than in increasing their personal profits.
May 18, 2015, by Voice of America”There’s nothing that can make up for a feed-in tariff that’s in the single digits,” said Daniel Potash, chief of party at the Private Financing Advisory Network for Asia program, under the U.S. Agency for International Development.
May 16, 2015, by Chetan ChauhanGermany was one of the first countries to allow grid-connected solar rooftops by the way of feed in tariff, which meant that people got more money for the green power they generated than the power they consumed.
May 12, 2015,Under the current setup, companies with end consumers make a monthly contribution towards the feed-in tariff which is set in US dollars and paid in Turkish lira at the exchange rate on the day of settlement.
May 11, 2015, by Craig MorrisHere, we see that the price of a completely installed solar array has been and continues to be considerably cheaper in Germany than in the US. The gap seems to have been around two dollars all along. Now that the price in Germany has fallen to two dollars, solar is now twice as expensive in the US as it is in Germany.
May 11, 2015,They spoke at a seminar styled ‘Feed-in Tariff (FIT) regulations: promotion and development of renewable energy in Bangladesh’, co-organised by the Dhaka University’s Institute of Energy, The Asia Foundation and Australian Aid.
May 7, 2015,The ‘Removal of Barriers to Energy Efficiency and Conservation in Buildings in Mauritius’ project is a United Nations Development Programme (UNDP)-implemented, Global Environment Facility (GEF)-financed project . . . Feed-in-Tariff for small scale producers of electricity and the setting up of the EEMO.
May 7, 2015, by Verity RatcliffeCairo has therefore decided to introduce feed-in tariffs for renewable energy projects. Under the new system, private companies will receive a fixed tariff for the power they produce from renewable resources.
May 4, 2015, by Piotr MrowiecWhile the EU countries are witnessing a retreat from feed-in tariffs, Poland is for the first time in history introducing feed-in tariffs to support its renewable energy sector.
April 30, 2015, by Karl-Friedrich LenzSo I noted with interest the failure of the first test case for the auction model. The auction price turned out to be above what the current feed-in tariff is, as this article at PV Magazine explains. Those first 154.97 MW will be built at €0.917per kWh, which is higher than the current €0.0902 of the feed-in tariff.
May 13, 2015, by Paul GipeAs part of our continuing exploration of the Nissan Leaf’s range, we took a one-day get-a-way and drove up to scenic Kernville deep in the heart of the southern Sierra Nevada.[more]
May 12, 2015, by Paul GipeWe had about a dozen cars, so there’s a dozen drivers there. Leafs, MiEV, two BMWi3s, a Ford, Rav 4, and a Tesla. There was quite a line up of vehicles–the Tesla attracting the most attention naturally.[more]
May 18, 2015, by Craig MorrisThis month, construction of the Beinn Ghrideag wind farm was completed. In the next few months, three 3 MW Enercon wind turbines are expected to start power production. A comparison with a recent German committee project is illustrative.
May 11, 2015, by Craig MorrisA few weeks ago, 360 German citizens completed and 82.3 MW wind farm consisting of 24 wind turbines. The project even included a transformer station, which the community project financed completely on its own.
March 18, 2015,In Germany, citizen cooperatives have long been investing in the production of renewable energies and some are now looking at how to buy back the energy grid from the energy companies. They failed to do so in Berlin, but have succeeded in Hamburg, creating a new business model that many other countries would like to emulate.