Any questions about the tactics Pacific Gas and Electric Company will conduct in a marketing campaign against Marin Clean Energy are answered in opt-out cards showing up in Marin mailboxes.

The irony contained in wordage on the cover of the card should be obvious: "Opting out of the Marin Energy Authority keeps your options open." How staying with PG&E would keep a customer's options open never gets explained in the opt-out notice.

On the reverse of the mailer, in the first of three bullet points, the mailer says the Marin Energy Authority (MEA) "isn't asking anyone's permission" and plans to "automatically take control" of electric supply. The opt-out notice on which that statement is written is part of a mandated process designed to ensure customers get a fair opportunity to stay with PG&E rather than go with Marin Clean Energy, which is the first program for the MEA joint powers agency.

The second bullet point states that the Marin Energy Authority doesn't guarantee lower rates than PG&E. While that may be technically true, Marin Clean Energy has repeatedly pledged to meet or beat PG&E rates while supplying 25 percent renewable power. The bullet point also states that according to "Marin's own 'independent assessment'" of the Marin Clean Energy plan, Marin Clean Energy prices could be higher than PG&E's rates. That statement ignores the meet-or-beat pledge.

That independent assessment refers to a report compiled by MRW & Associates, an Oakland-based energy consultant. Marin's city managers requested an independent appraisal of the Marin Clean Energy business plan, and the report is one of several independent appraisals, not including scrutiny from the California Public Utilities Commission.

In a letter sent to Tiburon's town manager, MRW stated, "As requested by the Towns and Cities in Marin County, MRW & Associates Inc. (MRW) has reviewed the 'Marin-California Community Choice Aggregation Businesses Plan' (Business Plan) prepared by Navigant Consulting, dated April 2008. Overall, we found no fatal flaws in the Business Plan. It creatively proposes a workable path to providing green power to those in Marin who want it while offering rate comparability and predictability to those who need it."

The review, however, did call for a more detailed "quantitative risk analysis." Along with that call for a more comprehensive technical review of risk, the report states, "We found that the key underlying assumptions made in the Business Plan (e.g., opt-outs, PG&E rates, renewable costs, gas prices, other procurement costs such as firming-up wind power) fall within expected ranges. But the Business Plan does not explore the financial outcomes under sets of other equally reasonable estimates for those values. Forecasts for these variables are better expressed in ranges with probabilities of occurrence."

The report acknowledges that different results can come from different assumptions, including the PG&E claim that Marin Clean Energy costs could exceed PG&E's retail generation costs. "While many of the assumptions used by PG&E may be construed as self-serving, it illustrates the point that different assumptions can lead to a radically different outcome."

Although MRW issued the report in 2008, the issues contained in it are still alive, as the PG&E opt-out card reveals. Marin electricity customers should prepare for a market battle along the lines of cable systems versus satellite systems. In all probability, PG&E, even after the initial opt-out phase, will engage in an ongoing campaign to poach customers from Marin Clean Energy. Of course, the reverse also holds, as Marin Clean Energy will in all likelihood continue to entice PG&E customers into the local-power fold.

The opt-out card's third bullet point deserves scrutiny. The utility company claims that Marin Clean Energy "isn't promising a more environmentally responsible energy mix," and a full half of the electricity PG&E generates is greenhouse gas-free. That claim is based on the fact that PG&E generates electricity from massive hydroelectric systems that many environmentalists believe are detrimental. The thrust these days is to dismantle dams not expand their use.

The utility also relies on nuclear power to make the greenhouse-gas claim. The hazards associated with nuclear waste and potential emissions are well known and match or exceed the hazards of greenhouse gases. Transporting nuclear waste is an additional problem. In fact, PG&E is generating about 14 percent of its power from renewable sources as defined by the state's initiatives to move toward renewable power. Marin Clean Energy will deliver 25 percent out of the gate. A 100 percent renewable option will be available for a 6 percent premium charge.

The opt-out notices come from PG&E, not from the Marin Common Sense Coalition, a PG&E front group that held a well-attended meeting in San Rafael last weekend. About 200 people showed up to express their opposition to Marin Clean Energy. A flier Common Sense distributed announcing the event screamed "Watch Out. The Marin Energy Authority is mailing notices to launch its government-run bureaucracy." The opposition's anti-government sentiment is a common thread.

The MEA is the administrative agency that counts Marin Clean Energy as its first concrete program. It comprises members appointed from each of the elected bodies in the joint powers agency. It's an arrangement duplicated in numerous joint powers agencies, including the Marin Telecommunications Agency and the Southern Marin Sewerage Agency.

Proponents counter the reduced-choice charge by contending that Marin Clean Energy actually increases choice. Residents easily can opt out of the Marin Clean Energy plan and choose PG&E. Marin residents can handle the responsibility and decision-making. (It is true that programs that run with an opt-out system end up with a larger number of subscribers than if they required potential customers to opt in. But to call opt out a government takeover designed to reduce choice is an exaggeration.)

Marin Clean Energy opponents also say the local-power plan contains a risk to ratepayers. But during the initial opt-out period, which ends in August, ratepayers can choose to stick with PG&E for no fee. Even in the first few years of Marin Clean Energy, ratepayers can choose to leave and go back to PG&E for a nominal fee of $5, according to Supervisor Charles McGlashan, chairman of the Marin Energy Authority. "That's the whopping risk to ratepayers: a whole $5."

McGlashan notes that if Marin Clean Energy customers choose to bail and return to PG&E, they must stick with the utility for three years, thanks to a ruling by the state Public Utilities Commission.

The financial risk to the general funds of MEA members also has been the focus of criticism, most notably raised in the critical grand jury report. McGlashan uses the example of other joint powers agencies to convince that an effective firewall can exist between the Marin Clean Energy and members of MEA. "Opponents have purposefully made this look terrifying. That's how monopolies destroy efforts like this: fear, uncertainty and doubt." Not only does state law prevent going after members of a joint powers agency, he adds, "we use dozens of JPA agencies for everything from general services, streetlights, emergency radio, and nobody's been sued."

The issue of municipal liability reignited when 11 former Mill Valley mayors wrote a letter to the current council urging a retreat from MEA and Marin Clean Energy.

In January, the current council affirmed membership in MEA, and rejected the call from former mayors to bail. City Councilwoman Shawn Marshall, who serves on the MEA board, arranged a meeting last week with former Mill Valley mayors Dennis Fisco and Betsey Cutler to address their concerns, including financial liability. In addition to Marshall, Fisco and Cutler, former mayor Garry Lion (who did not sign onto the letter) and McGlashan were present. It should be noted that in Mill Valley the mayor's role rotates among councilmembers. It isn't an elected position.

"I think the air was cleared on some key concerns," says Marshall. "I imagine they may still have a number of concerns, but I think we made progress on clearing away some of the old information that's been circulating."

"They were able to explain some of their points to us," says Cutler, "but in terms of changing my mind: no." Cutler says she understands that the Marin Clean Energy plan includes a firewall between the energy program and individual members of the joint powers agency, but she remains unconvinced that individual members can be kept safe from things such as lawsuits and insurance claims. "I know there's a firewall. But I don't believe that it could not be pierced."

Marshall says she will continue to disagree with the former mayors. "I have tremendous respect for the intelligence of all these people. The steps that I have been disappointed with is that they failed to reach out and let us know what their concerns were, what there questions were, before firing such a public shot. To me that is the piece of this that becomes egregious."

The critical grand jury report, which Marin Clean Energy supporters say relies on incomplete information and reaches inaccurate conclusions, set the stage for county treasurer Michael Smith to publicly oppose Marin Clean Energy. The former Mill Valley mayors then sent their letter. Their opposition is based on the points in the original grand jury report. And PG&E is using the grand jury report, Smith's position and the former mayors' opposition to craft a bomb-throwing campaign aimed at scaring potential customers away from Marin Clean Energy. The operation is similar to one on the national stage, the corporatism-versus-government debate that's obliterated by talking points about takeover and reduced choice.

Each member of the Marin Energy Authority now is engaged in examining the details of the energy contract the JPA has signed. Mill Valley, for example, "is taking a hard look at contract prices, greenhouse gas emissions, exit fees and risks," says current Mill Valley Mayor Stephanie Moulton-Peters. Municipalities are now choosing whether to actually purchase electricity from Marin Clean Energy. Moulton-Peters says Mill Valley will make the decision in April. Even if the city declines, residents still can go with Marin Clean Energy.

And in contrast to the negative campaigning in the anti-Marin Clean Energy event that PG&E operatives held in San Rafael last week, Marin Clean Energy plans to hold a workshop to explore the possibilities of local power. The workshop runs from noon to 2pm on March 15 at the Marin Civic Center, in the Planning Chambers, Room 28. The topic will be net metering. (PG&E in its opt-out mailing says Marin Clean Energy isn't offering the kind of ideas that are on the agenda at the workshop.)

Net metering allows electricity customers to sell excess power generated at their sites, through solar generation, for example. Under current PUC rules, PG&E customers can sell only enough power to bring their bills to zero. But Marin Clean Energy is looking at options that would allow customers to sell electricity beyond that point, thanks to PUC rules that allow Marin Clean Energy to buy excess power through net metering. It's just one of the local-power possibilities, say proponents, possibilities that the contract with Shell allows Marin Clean Energy to ease into with reduced financial risk.

No matter how people look at Marin Clean Energy, it's good for the consumer because it creates competition, say local power proponents. "It's stunning to watch (opponents) working vigorously to destroy competition by defending a monopoly," says McGlashan.

Contact the writer at peter@pseidman.com.

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