Nov 1 2016

Opinion: Renewable Energy in Piedmont a Risky Trap for the Unwary?

A Piedmont resident makes a request for the City Council and residents to receive more information prior to Piedmont joining a potentially costly new energy Authority.

On Monday, November 7th, the City Council will consider the First Reading of an ordinance authorizing the City to join the Alameda Clean Energy Joint Powers Authority.  This is called CCE East Bay establishing a Consumer Choice Aggregation for the electric bills of all Piedmonters.

Regardless of your wishes, you will be switched to the Alameda Consumer Choice Aggregation (CCA) for the source of your electrical supply and its cost.  Your contract with PG&E will be terminated and you will have a new supplier for your electricity if the City Council passes this and you do nothing.   You will continue to receive a bill from PG&E (which will still operate the grid and transmission lines & maintain them).  But the actual electrons for your house will be purchased for you by the CCA and billed to you as a new line item on your bill without your consent.

The rates and sources of supply of the Alameda CCA are not regulated by the California Public Utility Commission (as PG&E’s are).

Once the City Council agrees to join this Alameda County CCA, you will be sent letters for opting-out of the CCA and remaining with PG&E.  But if Piedmonters don’t know what all of this is about, there is a risk we will just ignore the letters sent out (as 75% of Richmond residents did with the Marin CCA) and they will automatically be switched to this Alameda County CCA.  At later dates, customers will be able to pay the CCA an administrative fee to get out of the deal.

Is this the best course for our environment?  Piedmont, as a city, has already achieved its goal of a 15% reduction by 2020 of GHG emissions.  According to numbers released by the California PUC (and independently verified), PG&E’s GHG emissions will be reduced to 209 co2/MWh by the year 2020.

PG&E is doing an admirable job in increasing electricity from renewable sources (Their success in this has been a 7% contributor to Piedmont’s 18.7% GHG emissions reductions.).  As of this time, 33% of PG&E’s electricity is from renewable sources; by 2020 (3 years from now), they project it will be 50%.  PG&E has started a Solar Choice Program under which consumers can elect to receive 50% or even 100% of their electricity from solar panel fields installed in Lodi, Manteca, Sacramento, among other locations, for an added cost to the consumer choosing this plan of 3.5 cents/KWh.

Have the City Council’s considerations of joining the Alameda County CCA included a presentation by PC&E?  Other cities considering joining the Alameda County CCA, including Hayward, have arranged such presentations for their City Councils.  As a matter of procedure, it seems odd not to have the major player here address the Council.

And what will obtaining power from a local Alameda CCA cost?  They claim the new power will only cost one penny more per KWh than what PG&E charges, but this opinion is based upon many assumptions and the rates are basically unregulated.  The expense of establishing a new, large bureaucracy (start-up costs estimated by Alameda County at $3.25 million; their plan is to raise $50 million for working capital, to be paid back in 5 years from rate revenue.) and the ongoing costs of paying them to administer the CCA program seems not to be justified by the claimed small reduction in GHG emissions

They claim that this CCA will bring many jobs to Alameda County, but, other than the Administrative jobs, the Feasibility Study points to non-Alameda county-located wind and solar farms.

The independent Feasibility Study commissioned by Alameda County cites many variables (such as the PG&E exit fee, the “PCIA” which must be charged to all CCA customers when they exit PG&E–so that their departure cannot cause the rates of the remaining bundled utility customers to go up), which they say could have an effect on the electricity rates charged by the CCA for our electricity (and such rates are not subject to PUC regulation as are PG&E’s).  Neither the benefits, costs nor projections of joining this Alameda CCA are clear, making the risks considerable.

For more information, I urge you to check out these internet sites:  Council ( Search agenda and report) (What are CCA’s?) (What are CCA’s)

Nancy Lehrkind, Piedmont Resident

Editors Note: Opinions expressed are those of the author.

9 Responses to “Opinion: Renewable Energy in Piedmont a Risky Trap for the Unwary?”

  1. Both sides should be allowed to present their case to the public. Thanks Nancy Lehrkind.

  2. CCA is a county-wide energy cooperative that directs the power authority to develop and purchase renewable energy. See the presentation to Council at the following link:

    The City reduced its GHG output last year by 18% thanks to Mother Nature, not PG&E. Exceptionally warm winter temperatures in California resulted in Piedmont using 85% less natural gas for heating. No need to heat your house when the planet will do it for you. That’s a consequence of global warming not an accomplishment of our Climate Action Plan. Participation in CCA is the most effective way for Piedmont to reduce its GHG output.

  3. Unfortunately Ms. Lehrkind’s opinion piece contains some factual misstatements, unsourced, that require correction.

    Incorrect Assertion: “The rates and sources of supply of the Alameda CCA are not regulated by the California Public Utility Commission (as PG&E’s are).”

    Fact: Under Public Utilities Code Section 366.2 (c)(7), the CPUC is required to certify each CCA’s Implementation Plan, which is required to contain rate setting and other costs to participants, as well as provisions for disclosure and due process in setting rates and allocating costs among participants.

    Public Utilities Code Section 366.2 (c)(3) requires a CCA Implementation Plan to contain all of the following:

    A) An organizational structure of the program, its operations, and its funding.

    B) Rate setting and other costs to participants.

    C) Provisions for disclosure and due process in setting rates and allocating costs among participants.

    D) The methods for entering and terminating agreements with other entities.

    E) The rights and responsibilities of program participants, including, but not limited to, consumer protection procedures, credit issues, and shutoff procedures.

    F) Termination of the program.

    G) A description of the third parties that will be supplying electricity under the program, including, but not limited to, information about financial, technical and operational capabilities.

    CPUC certification letters for various CCAs are available at

    Incorrect Assertion: 75% of Richmond residents opted out of the Marin CCA.

    Fact: The actual opt-out rate in Richmond is less than 20%, according to Marin Clean Energy Community Affairs Representative Alex DiGiorgio (personal correspondence 11/2/16), who further noted that Richmond has more ratepayers “opting up” to MCE’s voluntary 100% renewable power option, and voluntarily paying a little more to do so, than nearly anywhere else in MCE’s service area. El Cerrito and unincorporated Marin also have high rates of voluntary “opting up” to the 100% renewable option.

  4. I thank Ms. Lehrkind for her good research. I once heard a similar presentation by Marin Clean Energy to a different jurisdiction and went away thinking that such organizations were little more than an unnecessary middleman, adding to the cost of power, and not necessarily obtaining all their power from “green” or non-GHG emitting sources. As I recall MCE made an effort to make PGE look environmentally worse than they are by MCE not considering hydropower to be green energy. I am not sure about Alameda CE in this regard.
    But the preceding is incidental to what I really wanted to know: What does the switch mean to those like ourselves who already have solar and are not paying PGE for power except for a nominal distribution fee? I would guess it would mean little, but the devil is usually in the details.

  5. Mike, under the enabling statutes, all residents have the right to “opt out” of a CCA and have the investor-owned utility like PG&E procure as well as deliver their electricity. However, a CCA can choose to structure its “feed-in” tariffs to be competitive with or better than PG&E’s and thereby encourage home solar.

  6. BTW, I suspect that Tim and Nancy are saying essentially the same thing about Richmond’s opt-out rate, but not recognizing it. As I read both statements there should be agreement that 75-80% did not opt out of Marin Clean Energy and therefore this majority group did not go back to PGE.
    I would agree with Mr. Roberts that the Council should not introduce the ordinance on November 7th, but instead continue the matter to hear a presentation from PGE and possibly other voices.

  7. Tom Kelly, one of the consultants working on the East Bay Community Energy setup and launch, writes as follows:

    “[I]nvestor owned utilities are unlikely to participate in a public presentation that would appear to put Community Choice Aggregation in a bad light. The CA Legislature established a Code of Conduct for the utilities that makes it very clear that they cannot interfere in the development or operation of a Community Choice program. As a result they tend to avoid participating in presentations that may suggest their opposition. That said, SDG&E has been given permission by the CPUC to set up a Public Relations arm that is paid for by shareholders (rather than ratepayers) that has the ability to participate in public campaigns that may oppose CCAs. To date, PG&E hasn’t done the same thing.”

  8. Another large bureaucracy shoved down our throats? I won’t accept it; thus put me down to “opt-out”.

  9. Follow-up Clarification to Lehrkind Opinion Letter, November 2016
    As it relates to City Council Agenda item 9. Monday, 11/7/2016

    By Justis Fennell

    While Nancy Lehrkinds opinion letter published by the Piedmont Civic Association last week was likely intended to be instructive, it unfortunately confuses important details and dates.
    The provocative title, “A Trap for the Unwary?” is misleading and serves to diminish all of the hard work that the good folks at the City of Piedmont and the County representatives have so tirelessly performed. They thoroughly researched and provided an accurate presentation of the Community Choice Aggregation (CCA) program now pending before Council. There is no trap.
    It’s important to note that the CCA groups across the state, including this one are working locally for the benefit of their own communities and are NOT beholden to the shareholders of the their respective utilities. No one is being asked to do anything against their will. Whoever wants to stay with PG&E’s less clean electricity generation mix are welcome to do so.
    All of the information for making an informed decision about the risks (however minimal) and costs are contained in the following link.
    The actual name of the CCA program that City Council will consider Monday 11/7/2016 is East Bay Community Energy (EBCE). See the Executive summary (first 18 pages of 232 pages) at,
    In it you will find the logical rational upon which City staff is recommending the program. They are,
    1. Proving customers a choice of power providers;
    2. Increasing local control over energy rates and other energy related matters;
    3. Providing electrical rates that are competitive with those provided by the incumbent utility (PG&E);
    4. Reducing GHG emissions arising from electricity use;
    5. Increasing energy conservation and efficiency projects and programs;
    6. Increasing regional energy self-sufficiency; and
    7. Encouraging local economic and employment benefits through energy conservation and efficiency projects.

    Mrs. Lehrkind correctly points out that our Investor Owned Utility (IOU), PG&E “Is doing an admirable job in increasing renewable sources”. What is left out is the fact that they are required to do so by law. California has one of the most aggressive Renewable Portfolio Standards (RPS) in the Country – 33% of the State’s energy generation mix must be renewable by 2020 and now after Jerry Brown signed SB350, 50% by 2030. Two errors in the article related to the RPS are 1.) PG&E’s current renewable mix stands at approximately 30% not the 33% and 2.) PG&E future renewable power contracts for 2020 now stand at 37% not 50%. (To re-iterate, PG&E does not project their RPS at 50% by 2020). These seemingly insignificant percentage differences actually equate to hundreds of millions of dollars. The relationship between PG&E and us the users of electricity and natural gas is that of a vendor and customer. No contract is signed or terminated. In addition, contrary to what Ms. Lehrkind states, the implementation plan for a CCA program does require California Public Utility Commission (CPUC) approval.
    The articles in the Post and the Piedmont Civic Association have one small typo that is significant. Mrs. Lehrkind points to PG&E’s projected future Green House Gas (GHG) emissions in 2020 leaving out pounds in the equation. It should be 290 lbs. CO²/Mega Watt hour (MWh). That also equates to 0.29 lbs. CO² /kilo Watt hour (kWh (what we pay for on our electric bill)). Coincidentally we can calculate our individual household electricity carbon footprint by multiplying the estimated 2016 PG&E emissions mix which is 0.37 lbs. CO² /kWh (average Piedmont household, 700 kWh’s/Month x 0.37 CO² = 259 lbs. CO²/Month x 12 = 3,108 lbs. CO²/Year).
    The north of 10% CPUC authorized profit for the incumbent utility shareholders makes PG&E’s solar choice program more expensive than what local CCA programs have been able to achieve.
    Is a CCA program the best course for our environment? Yes, local control and choice are usually considered good things. Regarding Piedmont’s 2010 Climate Action Plan, reducing emissions 15% below 2005 levels, that was a very important first step, though only a modest goal. As announced by the City’s past Civic Spark Climate Fellow, Matt Anderson, “much of the reductions were a function of external factors.” We cannot just pat ourselves on the back and say, “Let’s continue with business as usual.”
    The science is clear; we need to keep 80% of the known fossil fuel reserves in the ground in order to avert raising atmospheric temperatures more than 1.5 degrees Celsius. Believed by virtually all of the credible scientific community the threshold beyond which catastrophic climate disruption is inevitable. This will be no small task but is doable. If you’re thinking about purchasing a new car, you should choose electric, or at least a plug-in hybrid. If either your furnace or water heater need to be replaced, you should switch to an electric heat pump version. If your roof is suitable, add solar Photo Voltaic (PV) modules. The most cost effective path is energy efficiency: just switching to LED lights throughout the home can save hundreds of kWh’s / year thereby saving GHG emissions and money. CCA programs around the state have been instrumental in helping folks learn about the many options for reducing our household and local carbon footprint.
    I encourage the Piedmont City Council to approve the agreement to participate in a Joint Powers Agency (JPA) for Community Choice Aggregation program in Alameda County.

Leave a Comment