Chula Vista Inches Toward Public Power

The city of Chula Vista is pursuing its goal of becoming a public energy agency in spite of other local entities? municipalization efforts getting waylaid by investor-owned utilities? opposition. At its evening May 19 meeting, the city council adopted a feasibility study that recommends that Chula Vista, which is in San Diego Gas & Electric territory, pursue serving electricity to new developments and become a community aggregator. The city is experiencing significant growth. The city council also voted to direct staff to prepare a request for proposals for a greenfield development service provider and a resolution for consideration on June 8 that declares that the city utility is a community aggregator under AB 117. Last week, the city of Moreno Valley was confronted with a ballot measure being pushed by a new citizen group funded principally by Southern California Edison to prohibit the city from spending general fund money on the new public utility (see Circuit , May 14, 2004). When asked whether Chula Vista expects to face similar opposition to public power from SDG&E?directly or indirectly?assistant city manager Sid Morris said he ?can?t begin to speculate on what SDG&E will do.? The city is focused on doing a due-diligence analysis in regard to its options on energy reliability and reducing rates, he added. The city?s feasibility analysis, conducted by Navigant Consulting, Duncan, Weinberg, Genzer & Pembroke, PC, and the McCarthy & Berlin law firm, recommended implementing a muni on a phased basis and immediately pursuing city ownership of a distribution system in undeveloped sections. It recommended against providing retail gas services but suggested that Chula Vista: Combine the community aggregation and greenfield projects. Begin developing a strategy for owning 130 MW of in-city generation. After three to four years of being in business, explore condemning SDG&E?s distribution system within the city. According to the feasibility study, creating a public power agency would save Chula Vista between $21 million and $122 million from 2006 to 2023, depending on whether the city would enter into short- and medium-term energy contracts or have its own generation. The city?s long-term electricity and gas franchise agreements with SDG&E expired in 1997, and attempts to work out a long-term deal have failed. The utility pushed for a 55-year contract extension without success, and the franchise agreements are on a month-to month basis. SDG&E has many concerns, including the potential for its customers to be saddled with costs if the city?s efforts fail, said Ed Van Herik, SDG&E spokesperson. The utility is analyzing the feasibility study, he said, adding that it wants to know who will handle billing and customer services, and whether the city has adequate resources to restore service after a fire or other natural disaster.

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Chula Vista Inches Toward Public Power

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