CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, JANUARY 23, 2015, OR THEREAFTER
BY THOMAS D. ELIAS
“BIG UTILITIES’ NIGHTMARE BEGINS TO PLAY OUT”
FOR RELEASE: FRIDAY, JANUARY 23, 2015, OR THEREAFTER
BY THOMAS D. ELIAS
“BIG UTILITIES’ NIGHTMARE BEGINS TO PLAY OUT”
The biggest nightmare of California’s
largest utility companies may be about to begin playing out, thanks to a small
irrigation district in San Joaquin County and a bunch of disgruntled customers
of Pacific Gas & Electric Co.
This trend also had help from the
state’s voters, who in 2010 rejected a ballot proposition designed and written
to prevent such a day from ever coming, a measure on which PG&E squandered
about $35 million.
Here’s what’s happening: Following a 4-1 vote by the county’s Local Agency Formation Commission, the South San
Joaquin Irrigation District will shortly begin taking over all PG&E’s local
power poles and generating plants and begin providing electricity to 38,000
homes and businesses (about 116,000 persons) in the cities of Manteca, Ripon
and Escalon, as well as some nearby unincorporated areas.
The non-profit district promises to
provide reliable power at lower costs than the for-profit PG&E.
No, the district will not steal
anything from the company: If it and PG&E can’t agree on prices for
equipment and facilities – cost estimates vary wildly from about $60 million to
as much as $600 million – a jury of county residents will decide the price.
Meanwhile, PG&E must continue
providing any needed electricity that can’t be generated locally, essentially
using its transmission lines and grid as a common carrier, in much the same way
an airline must carry any passenger who pays the fare.
If there’s one thing this state’s big
utilities don’t ever want to become, it’s common carriers, because that risks
lowering their profit margins considerably. That’s why PG&E ran the 2010
Proposition 16, which lost by a 53-47 percent margin. The measure would have
required a two-thirds majority vote in the affected area anytime a locality
wants to break away from a big utility.
The Manteca area is not alone in
wanting out from under the big-utility thumb. Movements are afoot in San
Francisco and 40 other locales around California. These are called Community
Choice Aggregations (CCAs), the choice being that customers in areas leaving
big utility companies can opt to stay with them simply by making that request
of the new power provider.
So far, this system has worked
smoothly in both Marin and Sonoma Counties, where almost a dozen cities have
separated from PG&E over the last few years, forming two new CCAs. Prices
are consistently lower there than in surrounding PG&E territory, so much so
that the Marin agency has lately spread its service area across the San Pablo
Bay to Richmond.
Plainly, the peril to the monopolies
of companies like PG&E, Southern California Edison and San Diego Gas &
Electric is of their own doing.
All backed the disastrous deregulation
of state electricity approved by the Legislature and then-Gov. Pete Wilson in
the late 1990s. That plan saw the utilities sell off many of their most
significant power plants to generating companies. Now, CCAs can buy from
those companies at negotiated prices. As part of the selloff deals, the
utilities agreed to continue transmitting power from the generating
stations over their grid.
In the new Manteca-area CCA, the total
savings will amount to $12 million per year if the irrigation district’s 15
percent price cut promise becomes reality. That could come to an average saving
of about $200 per year for a typical family.
This may explain why the only
persons speaking against the departure from PG&E at the local agency
commission’s hearing were affiliated with the utility. Meanwhile, customers
said things like this, from Manteca resident Roger Beauchamp, “PG&E doesn’t
respond to our needs and puts profits in front of the well-being of their
customers. Fire ‘em.”
The company’s image certainly hasn’t
been helped by its highly equivocal response to the 2010 San Bruno gas pipeline
explosion and its later criminal indictment for behavior afterward.
For sure, the movement away from giant
utilities to small city- and district-owned power companies is not yet
widespread and does not yet threaten the big companies’ survival or even
dented their bottom lines. But it is a thorn in their sides, a reminder that
given a choice, a lot of Californians would like to break away.
-30-
Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For ‘more Elias columns, go to www.californiafocus.net
Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For ‘more Elias columns, go to www.californiafocus.net
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