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San Diego is considering a bid to acquire its for-profit energy company

Activists pushing for San Diego to take over the city’s investor-owned utility are undeterred by last year’s defeat of a similar effort in Maine to create a nonprofit energy company. to target. They recently filed petitions with more than 30,000 signatures from residents who want the City Council to let voters decide the matter this fall.

Supporters say a municipal takeover of San Diego Gas & Electric would deliver cheaper rates and a faster, more affordable and more equitable transition to clean energy. Still, the measure faces strong resistance from skeptical council members who have twice rejected similar proposals.

The campaign is the public’s first ballot initiative since 70 percent of Maine voters rejected a proposal to take over the state’s two largest utilities. A group called Power San Diego delivered several cardboard boxes filled with petitions to the San Diego city recorder’s office on May 14. If just over 24,000 signatures on those documents are deemed valid, the Council will have to decide whether the question should be referred to the City Council. voters at the next election.

What’s happening in Southern California reflects growing frustration with the high rates and mediocre service that investor-owned utilities often provide, and a desire to accelerate the green transition. Similar campaigns are underway in Rochester, New York and San Francisco, and Empire State lawmakers recently introduced a bill to buy out Central Hudson Gas & Electric and create a public power authority.

“Across the country, people are talking about public ownership of energy,” Sarahana Shrestha, a member of the New York state Assembly who co-sponsored the bill, told Grist. “If we want a just transition – taking care of workers, and making sure it’s affordable and brings the benefits back to communities – there’s no effective way to do that as long as you’re still accountable to shareholders.”

San Diego residents pay some of the highest electricity rates in the country, and by one estimate, more than a quarter of customers are behind on their payments. (The utility has attributed its high rates to the costs of everything from preventing wildfires to building transmission lines and other clean energy infrastructure.) Adoption advocates say the measure would save residents 20 percent on their energy bills because a non-profit model eliminates the need to supply energy. shareholders with returns. It estimates the cost at $3.5 billion, citing a study commissioned by the city last year.

That analysis found that the utility’s 3.7 million customers could save 13 to 14 percent annually if the city bought the utility’s grid assets for $2 billion and created a municipal utility. However, the math is less favorable as the cost of the buyout increases; At a price of $6 billion, taxpayers could face additional costs of $60 million in the first 10 years but see long-term savings after 20 years.

San Diego Gas & Electric strongly opposes this effort and has supported the political action committee Responsible Energy San Diego to block it. The organization calls itself “a coalition of diverse San Diego leaders” fighting “a reckless ballot initiative to force a government takeover of the energy grid.” The utility has contributed more than $700,000 to the commission, according to records on the San Diego Ethics Commission website.

That’s more than double what Power San Diego raised and reflects a dynamic in which political action committees backed by the two utilities from Maine investors received 34 times more money than public power advocates. Activists there say this allowed the utilities to fund a robust campaign of advertising and disinformation to defeat the referendum.

San Diego Gas & Electric has hired Concentric Energy Advisors, the same consultants who helped defeat the effort in Maine. The company’s study commissioned by the San Diego utility estimated the cost of a public takeover of the electric grid at $9.3 billion.

Matt Awbrey of Responsible Energy San Diego told Grist that the city should address other priorities, such as affordable housing, instead of a proposal “to create a new government-run utility that has no plan, budget or verifiable cost estimates.” He said the costs of the takeover would likely involve “higher taxes, higher electric bills and/or cuts to essential city services on which we all depend.”

Power San Diego planned to collect 80,000 signatures by July, which would have placed the proposal on the November ballot. But it lacked the funding for such an effort and decided to collect 30,000 signatures, or about 3 percent of registered voters. That means the City Council must vote on whether to put the issue before voters.

Dorrie Bruggeman, senior campaign coordinator for Power San Diego, doesn’t expect the city to do that; it has already rejected such a proposal twice, with councilors calling for more details on costs and expected revenues. Council President Sean Elo-Rivera is among those who have reservations.

“I have no love for corporate monopolies that end up in the pockets of regular working people,” he told local news station La Jolla Light. “But this is a very complex and important issue and I don’t think this is enough to go to the voters.”

Regardless of the council’s misgivings, Bill Powers, president of Power San Diego, said his organization has sparked an important discussion within the community and galvanized voter involvement on the issue. The next step is to get policymakers behind this idea.

“If we can get a few council members who are open to public power, if we can get a mayor who is open to public power, which we have had in the past, then the movement is not dependent on the end point of a ballot initiative,” Powers said.

Such campaigns are gaining momentum elsewhere. Public power advocates in Rochester, New York, want the city to evaluate the costs and benefits of a municipal utility. In San Francisco, city officials are currently working with the California Public Utilities Commission to determine how to set a fair price for Pacific Gas & Electric’s distribution grid in hopes of creating a citywide public energy system.

On May 17, New York Assembly Member Shrestha and Senator Michelle Hinchey introduced a bill to create the Hudson Valley Power Authority, a public energy entity that would buy out Central Hudson Gas & Electric. The utility has faced criticism for high rates and a string of billing failures since 2021. If the measure passes, the Hudson Valley Power Authority will seek to lower rates, improve service and speed the green transition while protecting labor rights .

Joe Jenkins, director of media relations for Central Hudson, told Grist that the proposed acquisition would entail “significant hidden costs, job losses and loss of tax revenue for cities and schools,” adding that municipal utility rates in New York are nearly amounts to 9 percent. more expensive than those of investor-owned utilities.

Shrestha said the legislation reflects her constituents’ growing interest in public power. Her office has hosted seven town halls in the past year to discuss energy democracy. “People are so tired of getting bills that are inconsistent and late,” she said. “People are very excited to learn how we can actually gain public power.”


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