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Petaluma weighs public power agency

By JULIE JOHNSON

THE PRESS DEMOCRAT

Petaluma’s city leaders Monday night dug into the structure and risks of the planned Sonoma Clean Power Authority, an alternative to utility giant PG&Epower lines promised to bring a greener product to county residents.

Council members offered no glimpse at whether they’re likely to vote to join Windsor and unincorporated areas of Sonoma County in taking part in the power authority during two hours of presentation, discussion and comments at City Hall before an overflowing audience.

“This is a good discussion, and this is how people’s questions are going to get answers,” Mayor David Glass said. “In the last couple of weeks we’ve been bombarded with questions and concerns.”

Sonoma County Supervisor David Rabbitt, the lone member of the board to vote against launching the power authority in April when it was approved, started Monday’s discussion by emphasizing that he is a proponent of local, cleaner power and simply wants more time to vet questions.

“I want to know what I’m buying, there are questions I felt the public needed answered; I want to make sure Sonoma clean power will work as intended,” Rabbitt said.

Petaluma was the fifth city to hear the county’s public power pitch. Cloverdale was the first city to decline to take part, at least initially, and Windsor on Wednesday became the first to sign up. Sebastopol and Rohnert Park took no action.

Santa Rosa will consider the program today, with Cotati set to consider the matter on Wednesday and Sonoma on June 3.

Council members dug into questions about how the project will be financed and presenters explained lines of credit and the level of risk.

A long line of people spoke to the board, including environmentalists and residents, most in favor of the project. Customers will have the option to opt out and stick with PG&E.

Glass asked the presenters to explain the worst-case-scenarios and what they would mean for both customers and the cities.

If the power company failed, customers would be shifted back to PG&E, an unlikely scenario that nonetheless would not cause an interruption in service, Deputy County Counsel Steve Shupe said.

The power authority would not have any impact on a city’s financial wellbeing or, more specifically, its general fund, said Cordel Stillman, the Sonoma County Water Agency’s deputy chief engineer, who is among the presenters going from city to city.

Shupe explained that PG&E is subject to the same market conditions as a local utility. He reassured the crowd that he was a skeptic before he started examining the risks.

“The power providers that we are negotiating with have a big incentive to ensure we don’t fail, they’re interested in breaking into California market,” Shupe said.

They estimate rates for residential customers could be between 1.8 percent lower and 1 percent higher than PG&E. For commercial customers, rates could be between 3 percent lower and 0.5 percent higher.

The county is urging cities to join by June 30.

Councilwoman Teresa Barrett wanted to know how their vote would weigh against a city like Santa Rosa, which has a larger share of customers .

Each city and the county would get a member on the board and one vote. However those with more customers, such as Santa Rosa with 35 percent of the county’s electricity use, could call for a weighted vote in certain circumstances.

Shupe said that the larger jurisdictions wanted that provision.

“I’m sure they did,” Barrett said.

“The joint powers agreement can be amended by a two-thirds vote of the governing board,” Shupe said.

“Can they ask for weighted voting on that?” Barrett said.

The audience laughed.

“We’re looking out for Petaluma so forgive us for that,” Glass said.





2 Responses to “Petaluma weighs public power agency”

  1. andrew simpson says:

    Joseph Goebbels’ famous rule for the Big Lie:

    “when one lies, one should lie big, and stick to it”

    BOS/Water Agency/County Counsel Big Lies on Sonoma Clean Power:

    1. Big Lie #1:

    THE WATER AGENCY WANTS COMPETITIVE ELECTRICITY RATES

    This exemplifies the Water Agency’s capacity for lying big and sticking to it.

    The truth is, the Water Agency did a feasibility study on Sonoma Clean Power. This study is shown at
    http://www.scwa.ca.gov/files/docs/carbon-free-water/cca/CCA%20Feasibility%20Report%20101211.pdf.
    The gist of this study was to LIE BIG by excluding the single most pertinent fact of Sonoma Clean Power.

    Here’s the fact.

    Healdsburg’s electricity is 15% to 20% cheaper than PG&E’s. And 15% to 20% cheaper than that proposed for Sonoma Clean Power.

    Healdsburg is a member of the Northern California Power Agency (NCPA) with other members such as Ukiah, BART, Palo Alto and Alameda Municipal Power. NCPA WOULD LOVE TO HAVE SONOMA COUNTY as a member. AND ONE NCPA OFFICIAL HAS INFORMALLY INDICATED THAT THEY CAN DO BETTER THAN PG&E—HENCE BETTER THAN SONOMA CLEAN POWER—for the rate payers of Sonoma County.

    Why didn’t the Sonoma Clean Power feasibility study ask the question: what would our rates be if Healdsburg/NCPA replaced PG&E—instead of Sonoma Clean Power?

    They didn’t ask the question because Sonoma Clean Power will be more expensive—potentially by hundreds of dollars a year—to Sonoma County rate payers, than working with Healdsburg/NCPA.

    2. Big Lie #2:

    THERE’S NO RISK IN SONOMA CLEAN POWER

    There’s huge risk. In two parts.

    a) The Water Agency will run Sonoma Clean Power. They’re not just mendacious. They’re professionally incompetent.

    Did you know they took $45 million of County retiree pension fund money, stuck it in an ill conceived clean energy finance project called Sonoma County Independence (“SCEIP”) that was subsequently severely criticized by federal regulators? And that such criticism crippled SCEIP’s ability to raise funds from any legitimate lender or capital markets investor? Did you know that the Water Agency covered up this fiasco by taking $15 million more of rate payer money to prop up SCEIP; and then—with the complicity of County Counsel and the Supervisors—committed pension fraud by failing to disclose to County retirees that their fund had lost millions on a bad deal sponsored by the Water Agency?

    You didn’t hear about this?

    That was a $60 million “clean energy” catastrophe that the BOS and the Water Agency covered up—until now.

    Think what will happen if the Water Agency—with its combustible mix of incompetence and dishonesty—gets its hands on the $180 million in revenue and a billion in capital spending inherent in Sonoma Clean Power?

    The risk isn’t just a repeat of SCEIP.

    The risk is that Sonoma Clean Power is the straw that breaks the camel’s back. See next.

    b) We’re a billion dollars behind on pensions and the same on roads. The pension burden may materially escalate, to over $100 million a year.

    The BOS robbed Peter (roads maintenance) to pay Paul (themselves, and 99 other retirees who make six figure retirements). The BOS has made no material dent in pensions nor roads; and has no intention to do so.

    The County of Sonoma is in seriously weakened financial condition.

    The rating agencies are starting to pay attention. So what?

    It’s like your car insurance. If you get into too many fender benders, your rates go up. If you get enough fender benders, no more insurance.

    Only if the rating agencies (S&P, Moody’s, Fitch) say to Sonoma County, “enough already with your fiscal fender benders”, the County doesn’t get a big black eye. It’s not just that bond and borrowing rates go up. It’s called credit rationing. Credit rationing is when you can’t get loans, period.

    So as our County leaders persist in pulling a “Thelma and Louise”—driving the County into a fiscal Grand Canyon—it’s only going to accelerate the County’s reputation decline if the Water Agency does what the Water Agency does so predictably. Which is to misuse public money then lie about it. But instead of $60 million fiasco and coverup, think of a fiasco and coverup 20 times larger.

    In plainest English: if the Water Agency botches Sonoma Clean Power in any manner approaching their bungling of SCEIP, Sonoma Clean Power will go through this cycle;

    • Rate increases to cover up mistakes (did you ever wonder why your water rates go up so fast? Could it be you’ve been funding misadventures like SCEIP and didn’t even know it?)
    • Desertion of rate payers back to PG&E
    • Water Agency/Sonoma Clean Power inability to deliver enough revenues to meet contract and funding obligations
    • Sonoma Clean Power insolvency
    • The rating agencies experience a major “déjà vu all over again”: they will perceive, without any prompting, that the County of Sonoma is on the brink of joining the ranks of Vallejo, Stockton, and San Bernadino owing to Sonoma County’s endemic pattern of graft, fraud and sheer boneheaded public mismanagement in the face of crisis.
    • This deja vooing, visited on Sonoma County, could bring a domino effect on other agencies and cities in the County
    • With these pungent aromas wafting out of Sonoma County, how easy will it be to get new financing for road repair; for city projects; for public agencies?

    There’s a serious, demonstrable risk that Sonoma Clean Power—under Water Agency control– will be knee deep in graft, fraud and public deception; will go broke, and will create serious aftershocks for every public official, citizen, rate payer and taxpayer in Sonoma County.

    The assertion that’s there’s no risk in Sonoma Clean Power is a Big Lie.

  2. Steveguy says:

    I can’t wait until Sebastapol approves it, and Sonoma Greed Power picks a coal and nuke provider. The irony will be thick, like an oil spill.

    But they are ‘greenwashing’ the whole thing. If PG&E were allowed to count their hydro-power, Sonoma Greed Power would look like gross polluters.

    Again, 100% of my power comes from the Geysers, so does yours. How ‘green’ can we be ?