Cities Are Now Much More Aggressive About Renewables

It has become commonplace to observe that cities are in a unique position to drive the ongoing renewables trend, and California is a case in point. San Francisco and Los Angeles both recently took radical steps to accelerate the transition to solar and wind power, well beyond the pace adopted by many local utilities.

San Francisco: restoring the public utility model

Beyond the tragic loss of life, the recent wildfires in California have also had economic consequences, including the bankruptcy of the utility PG&E.

That presents an opportunity for the City of San Francisco.

According to a report in Greentech Media, local officials are exploring the possibility of creating a public utility from the remains of PG&E.

It won’t be just any old public utility. This will be a clean power utility, and San Francisco already has a running start.

Tens of thousands of San Francisco ratepayers have already signed up for the CleanPowerSF program, which enables them to access renewable energy through PG&E’s distribution system.

CleanPowerSF is the city’s community choice aggregation program, which enables ratepayers to negotiate for more renewable energy with their local utility.

In past years, community choice programs typically involved paying a premium for clean power. Now that wind and solar are more competitive in the power generation market, some cities are finding that community choice could result in lower electricity bills.

San Francisco is banking on competitiveness. Instead of waiting for more community choice volunteers to opt in, CleanPowerSF will automatically enroll customers in April.

Customers have the right to opt out of the program, but they city’s energy planners are anticipating that many more will stay in. Another 280,000 are slated to come on board the CleanPowerSF program when automatic enrollment begins, swelling the ranks to 360,000.

Clean power and job creation

One main sticking point is how to acquire PG&E’s distribution system while buffering ratepayers against the bankruptcy — and buffering elected officials from union leaders who are concerned about potential job losses.

Ideally, the employment impact would be tempered by new jobs in the clean power sector, with a focus on jobs for low-income residents.

Additional jobs could also evolve from basic upgrades to the distribution system, over and above any renewable energy activities. One official cited by Greentech Media noted that smaller public utilities in California have a good track record on safety, partly because they focus on infrastructure reinvestment rather than shareholder returns.

Either way, city officials have already put the legislative wheels in motion to establish a new municipal fund dedicated exclusively to setting up a new public utility.

Los Angeles steps up its renewable energy game

Los Angeles already has a public utility, and it is approaching the renewable energy challenge from another angle.

The city recently adopted a renewable energy plan that involves weaning itself off coal and other fossil fuels by 2045. In one recent development, the city’s Department of Water & Power (LADWP) cut ties with the notorious Navajo Generating Station power plant in Arizona three years ahead of schedule.

That was a pretty dramatic move, and earlier this week LADWP one-upped itself. The Los Angeles Times has the scoop:

“Los Angeles is abandoning a plan to spend billions of dollars rebuilding three natural gas power plants along the coast, Mayor Eric Garcetti said Monday, in a move to get the city closer to its goal of 100 percent renewable energy and improve air quality in highly polluted communities.”

As described by the Times, top officials at LADWP aren’t fully on board with this radical departure, but Garcetti is among those convinced that natural gas is not a sustainable solution.

More renewable energy for rural communities

All of this is good news for businesses seeking to raise their sustainability profile, especially small businesses.

In the not too distant past, renewable energy options were limited and expensive.

Even with today’s lower clean power prices and financial tools, entering into a renewable energy transaction can be a heavy lift for businesses with limited resources. Having it delivered automatically through utility bills is like a dream come true.

Cities aren’t the only places where the renewable energy revolution is accelerating.

The nation’s rural electric cooperatives (RECs) are becoming a powerful force for rapid change.

Together they serve more than 40 million customers, so any movement in this area really packs a punch.

As of 2017, RECs owned almost 1.3 gigawatts of renewable energy capacity outright. They also had long term power purchase agreements totaling more than 6.2 gigawatts, and about 10 gigawatts in preference contracts with federal hydropower plants.

As wind and solar costs continue to drop, RECs are taking extreme measure to untangle themselves from fossil fuel commitments.

In one recent example, the Kit Carson REC in New Mexico paid the hefty sum of $37 million to sever ties with the Tri-State Generation and Transmission Association, which provides electricity to dozens of RECs in the region.

For Kit Carson stakeholders, Tri-State’s high electricity rates and restrictions on renewable energy were the motivating factors, and apparently other RECs in the network are getting ready to follow in their footsteps.

Image credit: KP Tripathi