How Peninsula Clean Energy is bringing renewable energy to San Mateo County

An assortment of elected officials from across San Mateo County crammed into two vans on a recent morning and headed inland. Their destination: Los Banos.

Their route was a winding roadway through the Pacheco Pass, with dry, brown hills in every direction – a desolate California, far from the foggy sea, lush Santa Cruz Mountains or oaky chaparral that characterize their home jurisdictions.

Only one hiccup occurred when one of the vans got stuck on a pile of rocks on the dirt road leading up the hill. After the officials had been safely transferred to another van, they were deposited at their dusty destination, the literal end of the road that had a large shade structure, tables, a dais with a microphone, a team of supporters and collaborators, and a collection of golden shovels.

They had made the journey for the Oct. 11 groundbreaking of what’s called the “Wright Solar Project,” the installation of a solar farm that is going to be a 1,200-acre, 200-megawatt collection of solar panels that will provide between 500,000 and 600,000 megawatt hours a year of electrical power to meet the energy needs for about 15 percent of San Mateo County.

The Wright Solar Project is so far the largest solar power plant ever commissioned by what’s called a “community choice energy” provider in California, according to Peninsula Clean Energy (PCE), a community choice energy program that San Mateo County formed in February 2016.

The concept behind community choice energy programs is to pool energy demand across a large base of customers to purchase cleaner energy at cheaper rates than what Pacific Gas and Electric Company offers, thereby giving energy users an option for an electricity provider that’s not for profit but operated as a public, locally controlled utility. Currently there are 19 community choice energy programs in California serving more than 8 million people, according to the California Community Choice Association.

Employees working on the project acknowledge that it’s on an ambitious timeline. The plan is to cover these golden, rolling fields in Merced County in solar panels containing cells that move with the sun. Barring any major delays, the project is expected to be completed in November 2019, a timeline the project manager called “ambitious, but doable.”

For longtime landowner Dominique Arotzarena and his family, the solar farm represents a way to more productively use the land that’s been in his family for about a century.

About eight years ago, he said, he started talking to representatives of a solar power company, Frontier Renewables, and reached an agreement with them to install a solar farm on his property. Over time, Frontier Renewables sold its project to Idaho-based Clenera, and PCE purchased the power expected to come from the project. Arotzarena will collect a monthly lease for the property and, since he lives in San Carlos, will eventually receive some of the electricity generated from his property at his home.

The roughly 1,200 acres planned for the project were being used as grazing land and for winter wheat, Arotzarena said.

Clenera CEO Jason Ellsworth explained that the solar panels will follow an algorithm to optimize their absorption of solar power.

Solar power now comes at a lower cost than many other alternatives, the cost is known up front, and in this case, it will create an estimated 400 local, union jobs during the construction and upkeep phases of the project, he said. According to George Hershman, president of Swinerton Renewable Energy, the firm building the project, renewable energy employs more people than the coal, oil and gas industries combined.

Jeff Aalfs, a Portola Valley Town Council member and chair of the Peninsula Clean Energy board, told attendees at the groundbreaking that investing in solar power is “absolutely essential,” not only from an environmental point of view – he pointed to the recent report by the U.N.’s International Panel on Climate Change that warns of dire environmental impacts if global climate change is not capped at 1.5 degrees Celsius – but also from a business perspective. “This is the lowest-cost power,” he said.

The project’s director of development, Dustin Thompson, noted that the project has been in the works for several years. Siting and environmental studies, evaluations of topography, and geotechnical analyses had to be done, and upgrades had to be made to the existing power grid in the area to carry the power generated in Merced County to San Mateo County.

Project officials also had to secure state and federal permits. In this case, a conditional use permit was needed to set up the solar power farm for 30 to 40 years, he said. And when the photovoltaic cells in the solar panels reach the end of their useful life – which takes roughly 30 years – the plant could either be decommissioned and the land returned to its former state relatively easily, or the panels could be renewed.

Fees increase

Because Peninsula Clean Energy is operated as a public utility, any profits that might result from the difference in what it costs to purchase the energy from renewable sources and what the energy is sold for gets reinvested into promoting cleaner energy use throughout the county. At present, PCE provides most customers an energy mix that’s 50 percent renewable and 85 percent carbon-free at a slight discount from PG&E rates, and offers everyone the option to buy 100 percent renewable energy at a cost slightly higher than PG&E rates. In San Mateo County, businesses like Facebook, Visa and Guittard Chocolate – as well as the entire town of Portola Valley – have opted for the 100 percent renewable energy option, according to county Board of Supervisors President Dave Pine.

But because of a controversial decision by the California Public Utilities Commission last month, there’s a catch.

The same day that the San Mateo County officials were breaking ground on the giant solar farm, the state PUC unanimously decided to increase the fees that community choice energy program users must pay to PG&E for “opting out” of the company’s power offerings.

Those fees, and their variability, have been at the heart of the question of the viability of community choice energy programs across the state.

Despite the opposition of most of the public speakers responding to the proposal, and the recommendations of an administrative law judge, the commission adopted an “alternative” plan that raised the fees, called a “power charge indifference adjustment.”

“We don’t think it was a good decision,” PCE Chief Executive Officer Jan Pepper told The Almanac, noting that PCE’s position is in line with that of the California Community Choice Association.

The association released a statement saying the state PUC’s action is expected to steeply increase the fees for customers who buy energy through community choice energy programs. “At a minimum, the action will impair CCAs’ abilities to accelerate the state’s decarbonization and economic justice policy goals and to better tailor electric service to meet the needs of local communities,” the statement read.

In addition, on Nov. 19 the association, along with CleanPowerSF and Solana Energy Alliance, formally filed for a request for a rehearing with the state PUC to revise the fees, alleging that the decision included “legal errors” that “run afoul of the California Public Utilities Code, California Code of Civil Procedure, as well as other statutes,” according to a press release.

PCE is still evaluating the financial impacts of the rate hike, Pepper said.

The viability of newer community choice energy programs may be compromised by the fee hikes, according to people who advocated for lower exit fees at the PUC meeting. But PCE is in a relatively secure financial position.

“We have been very conservative in how we’ve structured the company,” said Atherton City Councilman Rick DeGolia, who represents the town on the PCE board. At the end of the 2017-18 fiscal year, PCE had a net position of $85.4 million. But any loss in profits means less funding to put back into cutting greenhouse gas emissions and promoting renewable energy in the county, Portola Valley council member Aalfs noted.

According to Pacifica Mayor John Keener, who is that city’s representative on the PCE board, “PCE is strong enough (that) it will probably be the last (community choice energy program) standing.”

“We came in at the right time to get it to market when it was relatively cheap. We were able to buy our power for less than what most (community choice energy programs) did,” he explained.

The agency recently announced the recipients of its first grant cycle aimed at funding renewable energy efforts in the county. They are ARCA Recycling, Inc., for a program to recycle old refrigerators; Ardenna Energy, LLC, to pilot a project for whole-house electrification; Build It Green, for energy-efficient remediation and repairs for low-income homes; CA Interfaith Power & Light, to install clean backup power at select faith organizations for use during emergencies; Envoy Technologies Inc., to promote electric vehicle car-sharing in an apartment complex in a disadvantaged community; and the county Office of Sustainability, to help city governments get clean-fuel vehicles in their fleets.

Vehicle emissions remain a major source of greenhouse gas in the county, DeGolia said, so to encourage people to buy electric cars that they can charge with cleaner energy, PCE has started a program with local car dealerships, including Nissan of Burlingame, Peter Pan BMW and Stewart Chevrolet, to provide PCE customers with discounts to buy or lease certain electric vehicle models. Go to peninsulacleanenergy.com for more information about that program.