Water district may join fight over proposed solar fee

By Karen Brainard

With two solar projects in the works, the Ramona Municipal Water District is going to consider if it wants to join a coalition of public agencies fighting San Diego Gas & Electric’s proposal to charge fees to solar customers.

SDG&E filed an application with the California Public Utilities Commission in early October for the new rate structure.

RMWD Legal Counsel Sophie Akins of Best, Best & Krieger LLP, (BBK) brought up SDG&E’s proposal at the water board’s Nov. 22 meeting.

She referred to a North County Times article published the previous day that had some public agency officials, including the Valley Center water district general manager, saying they would lose on their solar investments if the SDG&E rate takes effect.

“BBK’s representing a coalition of 10 agencies — school districts, the county water authority and water agencies — who currently have solar in the ground either through direct ownership or under a power purchase agreement,” said Akins. “We’re at a very preliminary stage in the proceedings.

“We’re just in the process of determining the actual impact of the proposal on our agencies, on our clients’ solar systems.”

Akins said SDG&E is basically proposing a new kind of demand or standby charge.

“They’re proposing unbundling it from the electricity rate and charging solar customers for the use of their system,” explained Akins.

RMWD is installing solar projects at its Santa Maria and San Vicente sewer treatment plants at no cost to the district, under 20-year power purchase agreements.

The district will purchase all electricity generated by the solar projects at an agreed upon price. After 20 years, the water district can either purchase the solar installations, extend the agreements or have the solar provider remove the installations.

The water district has estimated it could save $1.5 million over the 20 years in electricity costs.

Akins suggested returning to the board and meeting in a closed session to “determine whether the district would be interested in potentially participating as part of this coalition.”

Board Vice President Darrell Beck, acting as president in Bryan Wadlington’s absence, asked that the matter be included at the board’s next meeting on Dec. 13.

Because the proposed solar rate was not an agenda item last Tuesday, the board could not comment or ask questions. Later in the meeting, however, SDG&E’s proposed solar rate cropped up during a discussion on possible power reliability options for RMWD’s Poway pump station.

Director Kit Kesinger suggested the district explore solar installations as an energy source for the pump station.

Akins said she is a proponent of renewable energy but, because of SDG&E’s proposal and the impact to rates, she is advising clients who have not yet entered into a solar project agreement to hold off until the California Public Utilities Commission gives a final determination on SDG&E’s application.

“An additional issue that I foresee with solar photovoltaic at this time,” said Akins, “is that storage technologies are not yet as advanced or as inexpensive as we would like and they would likely be cost prohibitive.”

Kesinger asked when the CPUC’s ruling was expected. Akins responded that most participants do not foresee it being completed until probably the end of 2012.

Power reliability options for the Poway pump station were broached by the board after the massive Southern California power outage on Sept. 8.

RMWD General Manager David Barnum told the board that DE Solutions began an assessment of energy options and possible cost savings to the Poway pump station in 2008. The station pumps water 1,000 feet up the hill to Ramona from Poway.

A list of ideas had been narrowed to three possibilities: a permanent diesel generator, natural gas engine driven water pumps, or a natural gas generator set (COGEN).

Director Joe Zenovic said he would push consideration of a natural gas pipeline instead of “old technology diesel.”

The board gave the OK for an agreement to be executed with DE Solutions to complete the 2008 study with a not-to-exceed budget of $4,500.

In other business, the board accepted the annual financial audit for fiscal year 2010-11, which ended on June 30.

Barnum said the independent audit firm of Hosaka, Rotherham & Company gave an unqualified opinion, the best possible result. Barnum reported that revenues are up slightly and costs are down slightly. In an effort to be transparent, Barnum said, Zenovic, board treasurer, was included in the final client meeting with the auditors.

   
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