Benicia Community Sustainability Commission unanimously recommended Tuesday that the City Council use up to $30,000 in Valero-Good Neighbor Steering Committee settlement agreement funds for independent analyses of the pros and cons of joining Marin Clean Energy (MCE) , a community choice aggregation power agency.
The panel had just enough members to cast the vote — Chairperson Constance Beutel, Vice Chairperson Kathy Kerridge, who crafted the motion, Ershely Raj and the Commission’s student member, Anavi Subramanyam.
Commissioner Susan Maher was expected to attend by telephone conference call, but the call never took place. Voting commissioners Anthony Shannon and Bruce Barrow were absent, nor did the ex-officio members, who cannot vote, attend.
Beutel called the special meeting of the Commission during the Oct. 7 Council meeting, when Vice Mayor Tom Campbell and Councilmember Alan Schwartzman said they were reluctant to spend General Fund money for the additional analyses, which the Council requested as an independent look whether MCE and Benicia would be a good match.
Since one member of the Council, Mark Hughes, recused himself because he is a former employee of Pacific Gas and Electric, the city’s current power supplier, the Council appeared headed at best for a deadlock vote on proceeding with the independent study.
However, Kerridge asked the Council that night to authorize Kilger to proceed with the independent studies, conditioned on the Commission’s vote recommending the use of settlement agreement money to underwrite the examinations. Once the unanimous vote was cast, Kilger had Council permission to proceed.
The Commission had recommended, and the Council approved, spending up to $18,000 for the city’s application, including an examination of whether MCE could provide service to Benicia without any negative impacts to its current subscribers.
Approximately $4,000, and possibly more money, could be left over from the first study, and City Manager Brad Kilger said Tuesday the leftover funds would be returned as undesignated money in the Valero-Good Neighbor Steering Committee Settlement Agreement Fund.
The additional money will be used to hire MRW and Associates and Davis Wright Tremaine LLP to update their original assessments for Richmond and Mill Valley, made while those cities were candidates for MCE membership.
Benicia has a deadline for those new reports and any other actions needed before it signs the Joint Powers Agreement with MCE. In committing to membership, the Council must pass an ordinance to that effect by Dec. 2 to meet MCE’s power purchase cycle.
Should the city delay, Benicia may be unable to join MCE, because its board is considering delays in adding members except the two — Benicia and El Cerrito — whose applications are in the process of being completed.
If the city joins MCE, residents will be switched from being PG&E customers to those of MCE, unless they requests to be excluded so they can remain customers of PG&E. PG&E will distribute the electricity bought by MCE, will handle billing and will maintain distribution lines.
Kerridge said the city operations alone would save $40,000 a year, and up to $1.5 million community-wide. Because MCE buys its power from renewable sources rather than fossil-fuel producers, membership would reduce the city’s greenhouse gas emissions, she said. It also gives customers a choice, she said.
MCE purchases power and has plans for its own energy generation from green sources. The power it acquires is sent to the electrical grid, from which customers’ power would be delivered.
Kerridge said she planned to request MCE’s “local energy” service, to encourage local power-related jobs.
Subramanyam, who seconded Kerridge’s motion, said, “I agree with everything Vice Chair Kerridge said.”
Originally, Kilger had recommended funding the independent analyses, estimated at between $25,000 and $30,000, with General Fund money from City Attorney Heather McLaughlin’s and the Community Development Department’s budgets. That’s because the CSC wasn’t due to meet until next month.
In addition to authorizing the use of the settlement fund money, the Commission also had to determine the use of that money would provide a greater value than any existing plans for water reduction projects. The latter determination is a formality; no such projects currently are proposed.
“This is an extraordinary project,” Beutel said. “It’s the largest single thing we can do.” She said joining MCE is expected to give Benicia customers a 3 percent reduction in their electrical costs. “It will put money in their pockets.”
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I would like to see the proof on the $40,000 that Kerridge talks about. Just where did she get that number. Also the 3% Constsance talks about. Where did that come from. It appears 97% will or could be opted in or by default to the 50% energy. Each customer saves no more than about $8.00 a year. The other 3% will pay about $50.00 a year more. So just how did you arrive at the 3% savings. I think both of you should share that info, It appears the savings is more in the range of 1 1/2 % at best. We have no idea about the $40.000 or what it represents.
Yet another example of how we waste money that we didn’t earn. Perhaps Valero will know better the next time Benicia asks them for a half a million dollars. I suggest the Benicia City Council members simply Google; Michael Barnes, “Why I don’t support Albany joining Marin Clean Energy.” dated December 16, 2013. Its free and it clearly states why Marin Clean Energy is not what it seems and the citizens of Benicia could be financially liable if it fails, even if they opt out of the transition.
Thanks, Greg. A good read for the community, staff, and elected officials.
.http://mb4albany.org/?p=618
As I previously mentioned here, staff acknowledges a shortfall in expertise regarding electricity distribution and accounting, throw in RECs and it is even more complex.
It appears we have identified a consultant to do the risk analysis based solely on their previous relationship with two other cities in the MCE family. While this may help expedite the process ahead of MCE’s deadline, I believe the consultant may have a lean towards MCE’s interests. Once we’re in we can’t opt out without penalty. Should we someday decide to develop a minor utility, as identified in our Strategic and Climate Action Plans, we could not buy the electricity directly under a Power Purchase Agreement with the developer, It would have to be booked through MCEs accounting. The 3% savings mentioned if we go with MCE could possibly deny us a 5% or greater savings later. That is a risk that must be considered. This decision to join now will affect us for many years to come. What is the risk of not joining MCE per their timetable?
Energy consultants are a dime a dozen these days. Certainly staff will say they believe the consultant/s will do a good job for us, but how would they know if they don’t understand the subject matter?
Stan you guys are finally catching on. Just where have you guys been. MCE is for sure a bad deal for the city/residents. So you guys please tell me why the mayor/CSC just noy get it. Do you fellows have an answer. If you do would love to hear it.
Also mentioned here previously, other CCAs are in growth mode. Sonoma Clean Power is sponsoring and will make the keynote address at a symposium next week. We should send somebody in the interest of understanding more about CCAs and California’s future energy strategies.
.
https://sonomacleanpower.org/meeting/business-local-energy-symposium-cost-effective-local-renewable-energy/
http://climateprotection.org/local-energy-symposium/
Here is an interesting perspective on MCE from the former mayor of Belvedere
http://www.marinij.com/ci_20552382/marin-voice-why-i-opted-out-marin-clean
A more recent perspective regarding AB2145 and CCAs.
http://www.northbaybusinessjournal.com/94423/bill-is-seen-as-threat-to-community-energy/
Never mind about AB2145, dead in Senate this past August.
http://www.no2145.org/
However, the NBBJ article indicates Sonoma Clean Power at a 4% savings to customers.
It does appear that the folks are catching on. MCE is not a good deal. I do know wehere Kathy and Constance got their figures. From a very not in depth Feasiklility Report that cost $18,000. The only problern is =that it is modeled after a 80% participation. Does anyone jknow if Valetro is on board. Just ask them. Does anyone know ifr the members of the Industrial Park group are on board? Just ask the Chair of that group tp poll them.. There is much more info out there that must be investigated. Ask Berkely why they did not join. Check ou5t Albany and any otherr coties that may consider this. This is an emotional driven idealogy issue. Not driven by sound plans and facts. If this goes fiorward we should ask for guaranteed rates for five yeatrs. MCE will not guarantee rates. What if on their next buy rates go up. What then happens. If this does goe forward the conterACT
It does appear that the folks are catching on. MCE is not a good deal. I do know where Kathy and Constance got their figures. From a very not in depth Feasibility Report that cost $18,000. The only problem is that it is modeled after a 80% participation. Does anyone know if Valero is on board. Just ask them. Does anyone know if the members of the Industrial Park group are on board? Just ask the Chair of that group to poll them.. There is much more info out there that must be investigated. Ask Berkely why they did not join. Check ou5t Albany and any otherr cities that may consider this. This is an emotional driven idealogy issue. Not driven by sound plans and facts. If this goes forward we should ask for guaranteed rates for five years. MCE will not guarantee rates. What if on their next buy rates go up. What then happens. If this does goe forward the contraxt must have a consumer protection clause. Feel good just does not get it.
Valero built its own 51 megawatt cogeneration plant in 2001 or 2002. The California energy crises and blackouts of the Gray Davis era created too many financial and reliability risks for industrial plants and many either built their own generation or left California. I doubt Valero would find it economically advantageous to join the MCE and shut down a reliable and efficient source of power they can control. The risks of community aggregation will be borne by Benicia residents and small business, and they are not insignificant.
In a hypothetical situation where Valero decides to curtail or cease refining operations in Benicia, it is possible they would choose to continue producing electricity for sale. As mentioned previously here by commenter DDL, operation of the generator for public consumption could define the property as “in use”, and federal law regarding site environmental remediation could be held off indefinitely.
51 megawatts can power over 45,000 homes, way more than we would need for residents, commerce, and street lighting. Even though the generator is not renewable energy, the amount of GHGs saved in a major change of refinery operations is galactic, plus we would gain a tremendous amount of water as well. This situation must be considered in the risk assessment. There is no certainty that Valero will continue to refine products here indefinitely.
There have been some excellent comments on this run. All very positive about the risk, future considerations and the ability for MCE to be competitive in the future. As PG&E moves toward 50%+ renewa ble which it looks like it will happen by 2020 it puts all CCA’s in a position of having to up the 50% number to who knows what. The will be in a catch up mode. It does appear PG&E is still the best solution for Benicia residents. They do talk about reduction in Green House Gas, but where? Certainly not in Benicia. We expect an even worse report coming up by the CSC on Green House Gases. They have already said it will not be good. So is that the fault of PG&E or is it the fault of the Climaet Action Plan? I will let the residents figure that one out. Because MCE represents a very small portion of the grid Benicia will not even notice the GHG effect. If there is going to be an effect it is about time someone gives the residents/council that info. All I have heard is it will reduce GHG. So tell how much using the model that MCE is using which is 80% participation. This is a very bad deal. We do not want another solar issue. That did not turn out as stated. So there is no rush.
Here is a fairly recent article from the Marin IJ, indicating that MCE is partnered with Shell Energy. It also re-enforces a previous comment about MCE using RECs to manipulate their green sheen.
http://www.marinij.com/marinnews/ci_25718669/critic-marin-clean-energy-presents-his-case-marin
Here is a fairly recent article from the Marin IJ, indicating that MCE is partnered with Shell Energy. It also re-enforces a previous comment about MCE using RECs to manipulate their green sheen.
http://www.marinij.com/marinnews/ci_25718669/critic-marin-clean-energy-presents-his-case-marin