While the Marin Energy Authority assesses bids from a dozen companies to provide green energy and compete with Pacific Gas and Electric, the utility company has launched a campaign to kill public power plans across California.

Having a dozen companies respond to requests for proposals to provide green electricity in Marin calls into question a charge that PG&E and other opponents of Marin Clean Energy have promulgated: that in the current economic climate few reputable companies would step forward who could meet Marin Clean Energy criteria to provide green electricity at or below the rates PG&E charges.

The criteria in the Marin Clean Energy plan call for companies to provide electricity in a "light green" rate structure that is at or below PG&E rates. Customers in the light-green plan would receive 25 percent of their electricity from green sources when Marin Clean Energy starts to provide power, which would still flow through PG&E lines. The aim is to increase that 25 percent to 50 percent green in five years.

Customers who choose a "dark green" option would receive 100 percent from green sources at a cost estimated to be between 5 percent and 10 percent above PG&E rates.

The Marin Energy Authority, a joint powers agency, formed in December 2008. The ability to form the agency is the result of state legislation that allows communities to create their own energy agencies and purchase power--including green power--from any source.

The county and every city in Marin except Larkspur, Corte Madera and Novato joined the energy authority. In May, requests for proposals were sent to 130 energy suppliers to provide electricity to about 80,000 customers. The energy authority's staff and consultants are reviewing the proposals received from the dozen companies, and a recommendation is expected at the energy authority's Aug. 20 or Sept. 3 meeting, according to Dawn Weisz, the authority's interim director. (Weisz also is a county sustainability planner.)

After choosing a provider, the authority will draft a contract, which will go out for a 90-day review period before authority members decide whether to remain in the authority. If a jurisdiction remains in the agency, residents in that jurisdiction will have the opportunity to opt out of the plan, which means they will remain with PG&E.

PG&E has fought public power in Marin from the start, as well as elsewhere in the state, sometimes with unfair practices, say critics.

The San Joaquin Valley Power Authority paved a path for other entities in the state interested in creating public power agencies, technically called community choice aggregators. When news broke last month that San Joaquin was suspending its efforts to break away from PG&E, public power opponents said the experience should be a cautionary tale for Marin.

But, say proponents of Marin Clean Energy, the San Joaquin story actually is a cautionary tale about the tactics PG&E uses to block public power plans.
The charge is hardly without merit. After the state law passed in 2002 that allows cities and counties to form their own public-power agencies, the San Joaquin agency, which comprises 12 jurisdictions in the Central Valley, was out in front of the pack.

"San Joaquin started the RFP process in November of 2007," says Weisz, "and they had locked in a deal with one supplier in January 2008." But before the agency could start to provide power, PG&E pushed the agency to sign an agreement that would have allowed the cities and towns in the agency to be held responsible for any debts and liabilities of the authority's programs. And that, says Weisz, "is contrary to state law."

Nevertheless, the utility raised the issue before the California Public Utilities Commission, which resulted in a six-month delay in implementing the contract with the energy supplier. The Utilities Commission ruled in favor of the San Joaquin Authority. PG&E filed an appeal, which caused another delay. By the end of that process, the energy market "had changed dramatically," says Weisz, "and the supplier was no longer able to lock in the costs" that it had offered at the start.

At its June 25 board meeting, San Joaquin Authority directors "voted to temporarily suspend activities to implement Community Choice, an innovative energy program developed to benefit central San Joaquin Valley business and residents," according to a statement released by the San Joaquin authority. The statement also reaffirmed the agency's commitment to promote "regional collaboration, investment in local infrastructure and price discount and stability."

What sets the San Joaquin experience apart from Marin, notes Weisz, is the goal of the energy authority there. The San Joaquin Authority board was adamant that a public power plan must offer rates 5 percent below those PG&E charges. In Marin, the goal centers on providing green electricity at a cost that comes in at or below PG&E for the light-green rate schedule.

Although the Marin Energy Authority board still must assess the bids, it looks as though 11 of the 12 proposals are in the ballpark, says Marin Supervisor Charles McGlashan, chairman of the energy authority board.

Before PG&E played out its stalling scheme in the Central Valley, it had tried to tear apart the public power plan there when the San Joaquin Power Authority was in the formative stages. The utility mounted an aggressive advertising campaign designed to get cities to balk at becoming members. It worked to an extent, but the company's strategy failed to prevent creation of the authority, and its maneuvers led to a lawsuit over the company's marketing tactics; PG&E eventually settled with the San Joaquin agency.

The utility also played hardball with the Sacramento Municipal Utility District (SMUD) when, a few years ago, elected officials in Woodland, Davis and West Sacramento supported a SMUD bid to supply electricity at rates below PG&E. SMUD is a municipal utility, publicly owned and not beholden to shareholders or the need for profit. PG&E poured millions of dollars into campaigns to block measures on the issue in Sacramento and Yolo counties. A measure that called for breaking away from PG&E failed by a substantial margin in Sacramento. In Yolo County, however, it lost by less than 1 percent. The utility also poured millions into a campaign in San Francisco to block a push for public power there.

And the utility also has been playing rough in Marin, say Marin Clean Energy proponents. When Novato was considering whether to join, PG&E representatives said that if the city rejected Marin Clean Energy, the utility would provide Novato with energy efficiency funds at its fair share "or more."

A public goods charge on utility bills creates a fund of about $250 million a year to pay for energy efficiency projects across the state. That money and other sources of funds are aimed at improving the efficiency of electricity supply and consumption. Since 2006, the Public Utilities Commission (PUC) has allowed the utility companies, including PG&E, to collect and spend energy efficiency funds however they want.

The problem, says Barbara George, executive director of Women's Energy Matters, is that the PUC has no oversight to determine exactly how the utilities spend the energy efficiency money. In Novato, says George, PG&E's offer to throw "more" energy efficiency money at the city if it rejected Marin Clean Energy is a misuse of public funds. George's organization, based in Fairfax, is a recognized representative of the public interest in matters before the utilities commission.

George is calling for the PUC to investigate how PG&E has used energy efficiency funds. Her efforts have been spurred by a recent development: PG&E is behind a measure aimed at the June 2010 ballot that some say would kill public power in the state if voters approve it.

The measure, first called "The Taxpayers Right to Vote Act," is a constitutional amendment that mandates a two-thirds vote in any jurisdiction that seeks to create a public-power agency and break away from an existing utility power grid. It also would require an agency like Marin Clean Energy to garner a two-thirds vote in a proposed new expansion area, as well as hold a separate election in the existing service area. In other words, before expanding, a public power agency would need a two-thirds vote from its entire customer base.

Corte Madera, Larkspur and Novato did not join the Marin Energy Authority. If those municipalities choose to join in the future, and if "The Taxpayers Right to Vote" constitutional amendment passes, Marin Clean Energy would need a two-thirds vote of its entire service area, new and expanded, before accepting them into the fold.

Some say the two-thirds requirement is fair and reasonable. That's the position of Greg Larsen, the consultant at Sacramento public relations firm Larsen Cazanis. "What this simply does," he says, "is that if people in a jurisdiction believe this is a good idea, they will approve it." Critics say setting the bar at a two-thirds vote is a sure way to kill future formation of pubic power agencies and stop expansion of existing ones. It's an obvious attempt to use the tyranny of the minority to block public power.

The full effects of measure, should it pass, on existing public power authorities is an open question. According to the summary of the proposed measure released by the attorney general, it "requires the same two-thirds vote to provide electricity through a community choice program if any public funds or bonds are involved." That certainly has the potential for putting a kink in the wires of a public power agency that seeks to raise money through bonds. But it's reasonable, says Larsen, considering the large and long-lasting financial commitment required in a power-delivery plan.

George says PG&E will use millions of dollars, including energy efficiency funds, to push the measure. Larsen says backers currently are gathering signatures. They have until Dec. 21 to collect 694,354 valid signatures to place the measure on the June ballot.

Andrew Souvall, PG&E spokesman, says the utility's offer to Novato is no different from anywhere else within its service territory. The company dangled no special offers to entice the city to reject Marin Clean Energy. But Women's Energy Matters taped a meeting in which a PG&E representative clearly says Novato would get its fair share of energy efficiency money "or more." The question, of course, is where would that extra "or more" come from and would the utility short-sheet other areas of the county?

McGlashan filed a complaint with the attorney general over the measure's name, "The Taxpayers Right to Vote Act." The attorney general agreed it was misleading, and the name was changed to the "New Two-Thirds Requirement for Local Public Electricity Providers Initiative Constitutional Amendment."

The PG&E attack on public power "is totally cynical," says McGlashan. "What we're doing is taking away some of their monopoly revenue and using to it to create locally controlled, transparent, locally decided policies in our own public boardrooms. I am outraged by this. It's revolting."

McGlashan says municipal utilities and jurisdictions considering public power are talking about a joint effort to fight the PG&E measure, which is a clear "abuse of the initiative process brought to you in black and white."

It will be a tough fight against a utility that, McGlashan points out, is "using the PUC, using the courts and using the ballot to try to destroy good public policy."

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