Prop 16 is the statewide version of something I told my city manager and one of city council members I would do back in 2005. At that time I was on the Pleasanton Energy Committee (PEC), and community choice aggregation (CCA) was a new option for communities. It basically allows cities to become the purchasing agents for the electricity used by the residents and businesses within their borders. Some of the strongest supporters of CCA’s were liberal politicos with an ax to grind with PG&E, and I was against it from the get-go. The mayor of Pleasanton and one of her left-leaning cohorts brought in consultants from Navigant to try to convince the PEC to vote to recommend that Pleasanton enter into a joint powers authority (JPA) with Berkeley to become a CCA. Supposedly, this JPA would allow Pleasanton and Berkeley to obtain more green energy than we could get from PG&E (impossible without significant rate hikes), and avoid certain fees that PG&E rate payers had to pay to cover some of the expenses still being paid off from the deregulation/Enron debacle. Imagine our surprise when we found out that the Navigant consultant who was trying to strong arm a vote from the PEC was a former Enron employee!
I asked the usual questions that a fiscal conservative would:
1. Would Pleasanton rate payers pay less for their electricity if the City became the power broker?
Answer: No. Rates would remain the same, but the money that would have been going to PG&E fees would go into the City’s general fund.
2. So our electricity bills would become a slush fund for the City. What would you use the money for?
Answer: Police officers (and their pensions), fire fighters (and their pensions), parks, etc.
3. These are very vital things to the community, and it seems a bit reckless to have them funded by something as fluctuating as electricity markets. And what’s more, 2 small towns like Pleasanton and Berkeley can’t possibly get the same low prices on energy that a large utility like PG&E can get with volume buying power, so once you pay the higher price per kwH, there won’t be that much money to be made, unless…you raise our rates!
Answer: We think our residents won’t mind paying a little more to support these vital services and purchase more ‘green’ energy.
Wrong answer.
Astonishingly, the PEC was disassembled by the City Council before we could take a vote on the issue. At that time, I met with the City Manager and one of the City Councilmen, and promised the following:
If there were ever a plan to take Pleasanton into a CCA arrangement by flying low under the public radar by putting it on the city council agenda, I would work 24/7 to qualify a ballot referendum to ensure that voters fully understood that allowing their City to become a CCA would almost assuredly raise their electricity rates, and put vital public services at risk by linking them to one of the most volatile markets in the state – energy.
Not to mention the fact that utility rates are an important consideration for new businesses that may look at our city as a place to set up shop. If our utility rates are much higher than surrounding communities, we lose valuable tax base potential by not attracting new businesses.
So far, Pleasanton has avoided a government takeover of our electricity service, but without Prop 16 in place, other California communities might not be so fortunate.
If cities want to become community choice aggregators that is their choice, but it should be done with the overwhelming approval of the rate payers. That is exactly what Prop 16 ensures, and I urge you to vote YES on Prop 16.
May 10th, 2010 at 12:00 am
I take the NO on Prop 16 side of the debate.
Let us keep it easy to compete against the PG&E monopoly.
Proposition 16 is sponsored by the utility giant Pacific Gas & Electric. In effect, the proposition would protect PG&E’s government-regulated monopoly from the cheaper municipal government competitors who can now buy electricity and natural gas from the least expensive open market source. Cities like Santa Clara and Palo Alto provide cheaper utilities for their customers in this manner. Proposition 16 would create an extra hoop to jump through by forcing cities to obtain a 2/3-rd vote of the people before they could enter in competition with PG&E.
Control the PG&E monopoly through competition. Vote “NO” on Prop. 16
May 10th, 2010 at 12:00 am
A government takeover is not competition.
May 11th, 2010 at 12:00 am
If PG&E cant provide quality service without excessive blackouts, at an affordable rate then how can cities deal with the problem? Can they get another private company to take over for PG&E if they do an awful job instead of a public utility agency?
May 11th, 2010 at 12:00 am
Cities can’t effectively fill potholes and now you want them in the electricity business? Vote yes, make it harder for cities to branch out into things they don’t belong in.
May 11th, 2010 at 12:00 am
just look at LADWP, which is little more than a cash cow to subsidize Mayor Antonio and the City Council’s fiscal irresponsibility, and that should tell you all you need to know about City Utilities.
May 11th, 2010 at 12:00 am
The PG&E monopoly is spending millions on Prop. 16 to make it very tough for cities to buy FREE MARKET energy and distribute it on their own. Yet my brilliant fellow Republican, Jill Buck, posts above that competition benefitting the consumer is, “NOT COMPETITION” because it is done by a city.
Perhaps you missed something. Two energy source prices are no longer monopoly source prices albeit they are competitive prices. Let’s get real here!
As to the Loranger’s and Sheppard’s comments, however cities use their profits generated by buying energy on the OPEN MARKET, is their issue. Nevertheless, you indirectly admit that cities have those profits and simply claim they misuse their gains. That is, of course, a wholly separate issue from the gain through competition. There is a true gain from one plus one equals two and it is called competitive pricing.
May 13th, 2010 at 12:00 am
PG&E is spending $35 Million to secure your right to vote. What’s in it for them? And where did they get the millions to push this agenda? From rate payers.
How about we take a vote next time PG&E want’s a rate increase, or their CEO wants a bonus>
May 15th, 2010 at 12:00 am
an open market is where consumers get to choose who provides their good or service…a local government using its powers of coercion to get into a business is not