Dave Rice 12:30 p.m., July 29
- Community Blog
- Encanto Gas Holder
City of San Diego Protests SDG&E PeakShift Rate Hike Proposal
The City of San Diego filed its initial protest to the San Diego Gas and Electric Company application A1007009 to the California Public Utilities Commission. If approved, the SDG&E application to CPUC would result in a new electricity time-based billing policy called PeakShift at Work/PeakShift at Home (PSW/PSH), designed to inflict sufficient price signals to drive residential and small business power customers away from daytime business hour usage in favor of off-peak evenings and weekends.
SDG&E's PSW is a special problem for small businesses, still struggling after the Crash of 2008 in an economy with no predictable upside in the near future. Running a small business in San Diego will be more expensive if CPUC approves, and the tax increase effect is compounded for those small businesses that actually have a high industrial demand for power, as in operating grid-dependent machinery and equipment. From an ordinary reasonable viewpoint, the whole PSW rate scheme appears to offer an unfair competition advantage to larger SDG&E customers when everyone in the market is chasing a public with low consumer spending from unemployment-inspired low consumer confidence. The only ones who win with PSW/PSH are the largest of SDG&E's customers because of less competition and Sempra Energy shareholders receiving 35-40% dividends on quarterly retained earnings because SDG&E gross receipts are sure to go up, as most small business and residential SDG&E customers will not stop using all electrical devices during the business day, whether we get charged $118 million or not for the 2010-2015 ad campaign telling us it's cool to do laundry after the bars close, every day.
In its application, SDG&E claims to CPUC that the PSW/PSH plan should be revenue neutral for SDG&E and its holding company Sempra Energy, supposing that all of us play along. However, according to Fredrick M. Ortlieb at the Office of the City Attorney, “even though the Application notes the benefits to customers of the proposed program throughout, it presents no quantitative benefit-cost analysis demonstrating that the program offers net benefits to SDG&E’s customers. Given the expenditures and the behavioral changes that the rates contemplate, such a showing must be made.”
The Office of the City Attorney has this right. Show us the numbers, or have the application rejected. Otherwise, the City having to keep its doors open during business hours by law is a true daily tax increase to all of us if CPUC approves PSW/PSH on City offices and operations during normal business hours. Taxpayers do end up with that bill, and part of that bill is up for a vote in the coming November election.
I'm pretty sure that the San Diego City electricity franchise ordinance mentions some things about an annual franchise fee at some low percentage of SDG&E's gross receipts. It also mentions some things about a simple majority of voters having power to modify or even terminate the franchise. Surely we the voters have power to adjust the annual franchise fee to send a price signal of our own that it is time to put all of the power lines underground and eliminate future customer payments for utility wildfire liability. We do have that power, as the franchise ordinance must be strictly interpreted to the benefit of the City of San Diego and the voters therein ahead of the corporate grantee under the local power utility franchise.
This is the part where the chorus chimes in, on cue and in harmony.
As for the $118 million in requested SDG&E customer billings for consumer educational programs and related expenses, Ortlieb cited the financial impact on customers as “$20 per residential or small commercial customer for education alone and almost $90 per residential or small commercial customer for overall implementation” of PSW/PSH. CPUC's Division of Ratepayer Advocates has already filed a motion for CPUC to strike the $118 million reimbursement request from A1007009.
Will the City protest derail A1007009? I doubt it, although it may result in some modification of the application in the final CPUC decision on the matter. For me, what is important is what we do about it.
One thing that may reduce SDG&E's need for more fossil-fueled peaker plants is to start generating our own electricity off the grid and then using it in small businesses and in our homes as an emergency preparedness measure, an always-on backup to problems and transient failures on the increasingly-expensive grid. If a person can spend $250 this month on a square yard of solar panels, an inverter, and some extension cords, then that person can be generating 45 watts of her or his own power off the grid, and if everyone did it, we could reduce SDG&E's peak sales by maybe a percent or two. Someone doing that every other month can be generating about half a kilowatt in a couple of years; if all of us did that, then we might cut that peaker plant build demand in half or more. For residents who can't install solar panels, it isn't that hard to charge car batteries at nighttime off-peak rates then operate off-grid household appliances during the business day through an inverter. Of course, it's not the same as incrementally going off-grid solar, but it's better than doing nothing, going with the energy flow, and taking it in the assets.
After solar setup costs, all of our own electricity costs us what it costs to see the fusion power of the Sun: it's free, every day, happily ever after.
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