www.sonomacountywater.org

Sonoma County CCA Feasibility Study Summary

Cordel StillmanDeputy Chief Engineer

What is Community Choice Aggregation?

• AB 117 in 2002

• Counties/Cities Form Block to Purchase Electricity Generation on Open Market

• Transmission, Distribution, and Billing Remain with Investor Owned Utility (PG&E)

• Generation Rates and Power Supply Determined Locally

• This is an opt-out program, all are included unless they specifically take action to remain with the local utility

Public Power

Oh no, not more government!!

• 39 Public Power Providers in CA

• 25% Receive Municipal Utilities Power

• Average Municipal Rates 20% Lower

Feasibility Study

• DMC was retained by SCWA to conduct a feasibility study for

the formation of a CCA program in Sonoma County.

• The study examines the impacts on ratepayers, the environment and the local economy from providing a public alternative to PG&E for the supply of electric generation services within the County.

• Several potential scenarios were examined to understand

impacts using a range of potential energy sources and forecast assumptions.

• Objective of the study is to provide a conservative assessment

that can be used to determine if further analysis is warranted.

Steering Committee

• Veronica Ferguson – County Administrator• Kathy Millison- City Manager, Santa Rosa• Grant Davis- General Manager, SCWA• Suzanne Smith- Executive Director, RCPA/SCTA• Rod Dole- former ACTTC• Donna Dunk- ACTTC• Bill Keene- Executive Director, Open Space District• Ann Hancock- Executive Director, Climate Protection

Campaign• Dick Dowd – Private Developer• Jose Obregon- Sonoma County General Services• Suzanne Doyle – Sierra Club• County, City , and non-profit staff

Sonoma County Electric Customers and Consumption

Service Accounts Electric Consumption

2008 PG&E data show 218,000 electric service accounts and annual consumption of 2,778 million kilowatt-hours of electricity.

Projected Customer Base (2013)

Customer Classification Accounts Energy Consumption

(MWh)

Percent of Energy Consumption

Residential 142,724 950,294 48%Small Commercial 15,673 278,613 14%Medium Commercial 1,834 321,748 16%Large Commercial 277 235,607 12%Industrial 11 124,658 6%Agricultural and Pumping

2,043 44,486 2%

Street Lighting 1,695 12,925 1%     Total 164,257 1,968,331 100%     Peak Demand (MW)   365

Customers and Sales are adjusted for removal of direct access customers and assumed 20% opt-out rate.

Resource Planning Supply Scenarios

• Four representative supply scenarios were developed for analysis with

input from the project Steering Committee.

- Status Quo renewable energy content (“Scenario 1”) - Moderate renewable energy content (“Scenario 2”) - High renewable energy content with local emphasis (“Scenario 3”) - Very high renewable energy content with local emphasis and - accelerated timelines (“Scenario 4”)

• These scenarios were selected to define a range of potential outcomes

representing different supply choices that could be made during program development and operations.

• Specific goals for a Sonoma County program have not been determined yet.

Greenhouse Gas Emissions

• The CCA program could reduce GHG emissions by increasing

the use of renewable energy resources.

• Production from renewable resources would displace production from fossil-fueled generation.

• PG&E is required to supply at least 33% of its electricity from

renewable resources by 2020.

• A CCA supply portfolio comprising more than 33% renewable

energy (Scenarios 2-4) will result in reduced GHG emissions.

GHG Emissions

Economic Development

• Local economic development impacts accrue from job creation and spending for: - Labor > Installation & construction (short-term) > Operation & maintenance (long-term) > Jobs induced by generator operation - Land lease or purchase - Taxes & permitting fees - Construction materials for new renewable infrastructure

• The US Department of Energy National Renewable Energy Laboratory

(NREL) has developed the Jobs & Economic Development Impact (JEDI) models - Estimates economic impacts of constructing and operating different types of electric generators - Results are focused on statewide impacts - Output must be adjusted to reflect local benefits - Best available model but results are inherently difficult to measure

Economic Development Benefits

Impact Period Scenario 1

Scenario 2

Scenario 3

Scenario 4

Jobs (FTE)

Construction 100 to 300 100 to 400 700 to 1,500

400 to 1,100

Operation 15 to 100 20 to 100 100 to 200

100 to 400

Output

Construction $15M to $50M

$20M to $100M

$90M to $200M

$70M to $200M

Operation $4M to $20M

$10M to $20M

$20M to $50M

$30M to $80M

Notes:1. Two-year construction period.2. Operation period commences at commercial operation

date and continues for duration of project life.3. Jobs and output impacts include direct and indirect

effects.

Customer Rate Impacts

• CCA rates were estimated on an annual basis over the twenty-year study period and compared to projected PG&E rates.

• CCA rates recover all program related costs- Power purchases- Generation investment- Other operating costs (e.g., staff and overhead)- Scheduling and grid operations- Billing and data management- Financing

- Reserves

• CCA customers would also pay PG&E for delivery (T&D) and other surcharges.

• PG&E generation rates are estimated to increase by an average of 4% annually from 2011 to 2032

14

Bill Comparisons – Residential

15

Bill Comparisons - Commercial

Conclusions

• A CCA program could achieve significant reductions in GHG emissions for Sonoma County.

• Development of renewable generation within the County by the CCA program would have positive economic development impacts and result in local job creation; however there are challenges to local development that may impede achievement of such benefits.

• CCA program rates are likely to be somewhat higher than with PG&E in the near to mid term but should be more stable and less sensitive to rising fossil fuel prices over time.

• Working with the Marin Energy Authority could reduce initial startup costs and ongoing operations costs, but the terms of such a relationship are not known, and there would likely be trade-offs in regards to autonomy and achievement of local priorities.

Next Steps

• Present Feasibility Study Results to City Councils (get feedback)

• Perform a poll of County residents• Set Goals for Sonoma Clean Power• Investigate partnerships with Marin

Energy Authority• Determine costs of Implementation• Report back to Board within 6 months