Del Mar treads cautiously on Community Choice Energy

The Del Mar City Council on Monday, June 5, voted unanimously to partner with three other North County cities on a Community Choice Energy feasibility study.
(Sebastian Montes)

Harboring a fair share of questions and concerns, Del Mar wants to look into a government-run energy alternative that would free the city from SDG&E’s long-standing monopoly.

The City Council on Monday, June 5, voted unanimously to partner with three other North County cities on a feasibility study that would sort through the many uncertainties that enshroud whether creating a “Community Choice Aggregation” — or “Community Choice Energy,” (CCE) as it is increasingly called —would deliver on its promise of cheaper, greener energy.

Among the many uncertainties is that two of the three cities may back out.

Del Mar has been in talks with Encinitas, Carlsbad and Oceanside to share the cost of the $260,000 study. Del Mar’s share would be just under $29,000. Encinitas has agreed to spearhead the effort but, in the past few days, Carlsbad and Oceanside have signaled that they may back out. If so, Del Mar and Encinitas could look to recruit other SDG&E municipalities into the study, such as San Diego, San Marcos, Poway, Escondido and Chula Vista.

“We, as a council, may have to step up because my understanding is Carlsbad and Oceanside may not join this,” said Councilman Dave Druker.

Joining with Encinitas, Carlsbad and Oceanside would create a customer base large enough to make it likely to achieve a viable CCE. Anything less than 100,000 customers, however, would expose the CCE to far more financial risk.

Solana Beach — which made history last week by launching its three-phase plan to create the first CCE in San Diego County — is venturing out on its own by outsourcing its program to a pair of consulting firms. No other jurisdiction in the state has tried that approach.

So far, nine CCE’s are underway in California, covering 3.3 million people. That number is expected to grow five-fold by 2020.

“It would be, in my opinion, a great thing for little old Del Mar to be in the leadership of driving that ship,” said Councilman Dwight Worden.

Mayor Terry Sinnott, who worked for SDG&E for more than 20 years, drew the sharp distinction that the vote does not initiate a CCE for Del Mar. He stressed the importance of understanding the complexity of how rates are set and the risks posed by exit fees. He also wants to see a “comprehensive response” from SDG&E that addresses these and other concerns.

“I left that company because I did not like the way it was going, but I know a hell of a lot about how they operate,” he said. “… We are committing to invest in studying this thoroughly. Let’s get this done right. Let’s create a high bar and jump over it. It’s very, very important we do this right, because I think some people are not doing this right.”

Despite those misgivings, the council was enthusiastic about its decision.

“What is so appealing to me about this is that lots of times as a small city all we can really do is make a symbolic gesture,” said Councilwoman Ellie Haviland. “But this is real, it’s tangible, it will have an impact on the environment, it will have an impact on what other communities do in Southern California.”