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San Diego Becomes Largest City to Move Forward with Community Choice Energy

S.D. Council Approves Mayor’s Plan to Create Regional Joint-Powers Entity with Other Cities to Lower Energy Costs and Reach 100% Renewable Energy by 2035

Tuesday, Sept. 17, 2019 - NEWS RELEASE

San Diego – In a major milestone that will transition San Diego to 100 percent renewable energy, the San Diego City Council today approved Mayor Kevin L. Faulconer’s proposal to create a new joint-powers entity with cities across the region to provide residents the choice of greener energy.

The vote makes San Diego the largest American city to pursue a clean energy community choice program, setting a new standard for the rest of the country. The regional entity will be the second-largest community choice entity in California in terms of electrical load. San Diego was the first big city in the U.S. to pledge to reach 100 percent renewable when the City Council adopted Mayor Faulconer’s Climate Action Plan in 2015.

“Today is a monumental step toward 100 percent renewable energy for our city, and a greener and cleaner future for our region,” Mayor Faulconer said. “This is about lower energy costs for customers, green jobs for working families and renewable energy powering homes and businesses. The future has arrived, and we proudly stand with our regional partners to lead the green energy revolution.”

After three years of research and analysis, Mayor Faulconer selected Community Choice as the preferred pathway to reach the 100 percent renewable energy goal in the City’s landmark Climate Action Plan. The new entity would create healthy competition to benefit San Diegans, lower energy costs for ratepayers, and help the City reach its renewable energy goal by 2035 – a decade ahead of the state’s goal.

Today’s action follows recent votes taken by the cities of Chula Vista, La Mesa and Encinitas to join the regional joint-power entity. Mayor Faulconer led a collaborative negotiation process with other cities to develop the terms for this new regional entity. The city of Imperial Beach is expected to consider this proposal later this week.

“Chula Vista is taking action to increase local control over the energy our community uses and by partnering with other jurisdictions, like the City of San Diego, we will be able to eliminate upfront costs and minimize risk to the City’s general fund,” said Chula Vista Mayor Mary Casillas Salas. “Climate change is already affecting our communities and we do not have time to delay action. We look forward to working with the other cities to provide our residents and businesses a new, cleaner, cheaper energy choice.”

A regional approach would allow for greater negotiating and buying power as well as create efficiencies in operations and service. Analysis shows that Community Choice would result in lower energy costs compared to the investor-owned utility’s rates.

Encinitas Mayor Catherine Blakespear said, “I am grateful for the City of San Diego for taking a leadership role and working regionally to get this important initiative off the ground. We are in a climate crisis and we need to work together to protect the environment for future generations.”

The City conducted a feasibility study in 2017 that included extensive analysis and third-party peer review. It concluded that the Community Choice program would be reliably solvent and financially feasible. The City then tasked MRW & Associates – a firm with more than 20 years of experience advising the City, other municipalities and utilities on energy issues – to develop a PDF icon business plan for the Community Choice program.

“I’m proud to have voted today to create a cleaner, greener San Diego,” said San Diego City Councilmember Jennifer Campbell, Chair of the Council’s Environment Committee. “The opportunity to decrease greenhouse gas emissions, save San Diegans money, invest in vulnerable communities, and provide good, local jobs is truly progress in action.”

Enacting Community Choice, a program in which a public entity purchases greener power for residents, will be a multi-year process. Following the formation of the joint-powers entity and appointment of its board of directors later this year, the board would then hire an executive leadership team, including a chief executive and chief financial officer, which would guide the entity through the implementation process. The new entity would then seek approval from the California Public Utilities Commission with the goal of delivering power as soon as 2021.

“This is a historic moment. We are on the cusp of transforming our energy future and implementing our 100 percent renewable energy goal, a linchpin of achieving our Climate Action Plan commitments,” said Nicole Capretz, Executive Director and Founder of the Climate Action Campaign. “We are so proud of all the cities stepping up to join this energy revolution.”

Here’s what people are saying about a regional CCE:

Imperial Beach Mayor Serge Dedina: “We are so stoked to join this amazing, globally and nationally important coalition to ensure our residents have access to cleaner and cheaper power.”

La Mesa Vice Mayor Bill Baber: “This an exciting day for the San Diego region, but it’s only the beginning. The City of La Mesa looks forward to working with our partner cities to bring choice to ratepayers and to protect the environment for future generations.”

San Diego City Councilmember Vivian Moreno: “Moving forward with a joint powers agreement for the City’s Community Choice Energy Program creates competition and now customers will have a choice about who to buy their energy from. In taking this step, we can fight climate change here locally and preserve our beautiful region for future generations.”

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