STAFF REPORT TO THE CITY COUNCIL
DATE: Regular Meeting of May 9, 2023
TO: Mayor Walker-Griffin and Members of the City Council VIA: Dante Hall, City Manager
SUBMITTED BY: Timothy Rood, AICP, Community Development Director SUBJECT: Membership in Marin Clean Energy
RECOMMENDED ACTION:
Receive a report from City staff;
Ask any questions of City or MCE staff;
Take public comment;
Approve a Resolution Requesting Membership in MCE authorizing the Mayor to execute the Memorandum of Understanding with Marin Clean Energy, and authorizing the City Manager, or designee, to execute other documents to initiate membership in Marin Clean Energy; and Approve the first reading of an Ordinance approving the Marin Clean Energy joint powers agreement and authorizing the implementation of a community choice aggregation program.
BACKGROUND:
Community Choice Energy
Authorized by the Legislature under AB 117 in 2002, Community Choice Energy (CCE), formerly known as Community Choice Aggregation (CCA), is a program by which local, not-for-profit public agencies provide electricity and often other energy-related programs to residents and businesses in their service area. Through Community Choice, communities join together to pool (or aggregate) their electricity load in order to purchase clean energy and develop local projects and programs on behalf of their residents and businesses. Community Choice providers work in partnership with the region’s existing Investor-Owned Utility (IOU), which continues to deliver power and maintain the power grid.
Since the launch of Marin Clean Energy (now known as MCE) in 2010, many new CCAs have formed in communities across the service territories of California’s three largest IOUs: Pacific Gas & Electric (PG&E), Southern California Edison (SCE) and San Diego Gas & Electric (SDG&E). According to Cal-CCA, the trade association representing CCAs in California, as of summer 2022, there are 24 operational CCA entities serving over 15 million people in more than 200 California cities and about half the counties in the state. According to CalCCA, CCAs in California have contracted for over 10,000 megawatts (10 gigawatts) of new renewable energy capacity and over 2,600 megawatt-hours of new energy storage, avoided about 940,000 metric tons of GHG emissions per year, and supported thousands of jobs.
Enrollment Process
Once a city or county implements or joins a CCA program, state law requires that residential customers within a CCA member's jurisdictions be enrolled in CCA service unless they choose to opt out. The noticing process is conducted by the CCA and includes a website and telephone call center for questions. The default power product at enrollment is selected by either the CCA or the member agency’s governing body, and once enrolled, customers have the option to “opt up” or “opt down” to a different power product, or to “opt out” of the CCA entirely at no charge and continue to purchase their electricity from PG&E. Customers will receive at least two notices during a 60-day period prior to CCA service commencement and at least two additional notices during a 60-day period after CCA service commencement. These notices will inform the customer how to opt out of the program if he or she chooses to do so.
MCE
MCE is a Joint Powers Authority that provides renewable energy services to over 331,000 customers throughout Contra Costa County. Over 88% of all electric customers in MCE’s Contra Costa County member communities receive their electric generation from MCE. In Contra Costa County, the unincorporated County and the cities of Concord, Danville, El Cerrito, Lafayette, Martinez, Moraga, Oakley, Pinole, Pittsburg, Pleasant Hill, Richmond, San Pablo, San Ramon and Walnut Creek are members of MCE, which now serves 37 communities in Marin, Napa, Solano and Contra Costa Counties.
Like most CCAs, MCE is a Joint Powers Authority (JPA), with a board made up of elected officials representing its member agencies. PG&E continues to deliver the electricity through its transmission and distribution system and provide meter reading, billing, and maintenance services for MCE and other CCA customers in its territory, as well as to provide natural gas service. The MCE charges appear as a line item on the PG&E bill. MCE’s standard service, Light Green, has contained 60% renewable energy or more since 2017, meeting state goals 13 years ahead of schedule. Light Green is projected to be 95% GHG-free by 2023 and will increase to 85% renewable by 2029.
ANALYSIS:
At its March 14, 2023 meeting, the City Council directed staff to return to Council for consideration of the documents needed for the City to join Marin Clean Energy (MCE) in 2024.
Should the City of Hercules decide to join MCE as a new member community and complete the second reading of the JPA ordinance by June 30, 2023, Hercules community members would be eligible for a spring 2025 enrollment date in MCE services.
Default Service Option
Following the City Council discussion on March 14, 2023, MCE staff confirmed that Hercules customers would enroll at the Light Green service option, and Light Green would remain the default service option for all customers through the end of the calendar year in which enrollment occurs. Thus, if Hercules were to enroll as an MCE member in April 2025 as anticipated, Light Green would be the default from April 2025 through December 31, 2025.
In the calendar year following enrollment, customers would move to a Deep Green default for new electric accounts (those not previously enrolled in MCE). That would mean on January 1, 2026, Deep Green default would go into effect. This is the same as MCE's current service-area wide enrollment policy, which is that new electric accounts are automatically enrolled in Deep Green. This is subject to Deep Green still being MCE's default service option in 2025. If MCE is no longer offering a Deep Green default, this shift to Deep Green default would not apply. Customers enrolled automatically in Deep Green would still have the option of switching to Light Green if they chose.
Enrollment Process
The steps to enter into MCE's Joint Powers Agreement are outlined below:
Before June 30, 2023: City Council should adopt resolution, first and second readings of ordinance, and memorandum of understanding to join MCE; City staff complete two required PG&E forms (forms 79–1030 and 79–1031). The two forms allow MCE to access Hercules customer's electric load data from PG&E. The forms are a nonbinding agreement, and do not constitute a commitment from the City of Hercules to join MCE - they simply allow MCE to access PG&E customer data.
Mayor signs signature page of MCE’s joint powers authority (JPA) agreement; MCE conducts technical analysis;
MCE Board of Directors holds a vote to include prospective new communities by the end of 2023; Enrollment of new communities begins in 2025, pending certification by the California Public Utilities Commission (CPUC).
The resolution, MOU and ordinance attached to this item would implement steps 1-3 above and allow MCE to proceed with steps 4 and 5.
FISCAL IMPACT:
There is no fiscal impact associated with this action.
ATTACHMENTS:
Resolution Requesting Membership in MCE, Memorandum of Understanding, and PG&E Load Data forms Ordinance Approving MCE Joint Powers Agreement