Yolo-SMUD Annexation Vote Pending

The Davis City Council is scheduled to vote March 15 on whether to formally ask the Sacramento Municipal Utility District to annex the city to its service area. Three Yolo County cities and unincorporated areas of the county now served by Pacific Gas & Electric are moving forward toward seeking SMUD annexation to secure local and cheaper power. The West Sacramento City Council will vote on pursuing annexation to SMUD on March 16, and the Yolo County Board of Supervisors on April 5. The Woodland City Council unanimously endorsed the SMUD annexation proposal on February 15. ?The only real opposition in Davis is PG&E. I have not heard opposition to date from any citizens,? said Bob Weir, the city?s public works director. PG&E maintains annexation will cost ratepayers a 25 percent rate hike. Davis and West Sacramento held public hearings on annexation last week, and their respective natural resources committees endorsed the proposal. Public power proponents are optimistic that all three jurisdictions will follow Woodland?s lead and formally seek annexation to SMUD. ?Everything?s going to be a go-ahead,? predicted Dan Berman of the Coalition for Local Power, long-time Davis public power backer. The Davis staff report asks the Davis City Council to accept the conclusions in a study prepared by consultant R.W. Beck released in January and to request that SMUD annex the city. The Beck report concluded that the cost savings to customers would be greatest if SMUD annexed all three cities and the unincorporated areas of Yolo County together, adding a total of 85,000 PG&E ratepayers to its service area. SMUD commissioned the annexation study at the request of the Yolo County jurisdictions. The discrepancy derives in part from the two utilities? widely diverse estimates of the value of PG&E?s power lines, poles, substations, and other electric facilities in Yolo County. The Beck study estimated that PG&E?s electric distribution system in the 190-square-mile annexation study region is worth between $56 million and $108 million. PG&E argues that its Yolo County electric facilities are actually worth half a billion dollars. ?Right now the problem is we don?t have hard data,? Paul Lau, SMUD?s project manager for annexation, said. ?Beck?s numbers and PG&E?s are so far apart. The issue is so complex it?s hard to understand.? If SMUD exercises its power of eminent domain to condemn PG&E?s electric system in Yolo County and PG&E sues to stop annexation as expected, the court will order PG&E to open its books so a fair appraisal of its system can be made. Rather than condemning PG&E?s electric system, SMUD could contract with the California Independent System Operator to route power to its new customers in Yolo County, Lau said. However, SMUD is more likely to condemn PG&E?s lines and build some new transmission lines to connect them to the muni?s system. ?Once we take over, PG&E will have no use for transmission lines,? Lau said. If SMUD?s board decides to move forward with annexing the Yolo County jurisdictions, the local agency formation councils for Sacramento and Yolo County will then consider the proposal. The California Public Utilities Commission will also have to hold public hearings and vote on the SMUD annexation proposal. Ultimately, voters in the three cities and Yolo County will have the final say over whether they want to be served by PG&E or SMUD.

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Yolo-SMUD Annexation Vote Pending

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