Greater Fresno Area Chamber of Commerce
2331 Fresno Street
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P.O. Box 1469
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Fresno, CA 93716-1469
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(559) 495-4800
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Fax
(559) 495-4811
Government Affairs Council
Wednesday, July 11, 2007
12:00pm
Presiding:
Ruth Evans, Chair
Call to Order and Roll Call
Chair’s Report
1. Redistricting Coalition UPDATE
2. Legislative Tracking
Local, State, Federal Legislative Staff Updates
UPDATE
New Business
3. Community Choice Aggregation
Al Galvez, PG&E
Dave Orth, Kings River Conservation District
ACTION
4. Digital Video Surveillance Security Systems ACTION
Adjourn
If you have any questions regarding this agenda please contact Amy Huerta at: ahuerta@fresnochamber.com or at (559) 495-4818
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ACTION
Agenda Item #1
Government Affairs Council
July 11, 2007
Community Choice Aggregation
Sources:
Community Choice http://www.communitychoice.info
AB 117 Analysis http://info.sen.ca.gov/pub/01-02/bill/asm/ab_0101
0150/ab_117_cfa_20020912_125633_sen_floor.html
PG&E
Background:
AB 117- On September 24, 2002 the California State Legislature approved AB 117 which established a general exception to the direct access suspension for community aggregation undertaken by cities and counties serving their own residents.
This bill changed the procedures governing community aggregation to allow cities and counties to aggregate on an "opt-out" basis, rather than an "opt-in" basis. This bill contains provisions to ensure cost recovery from departing customers. This bill resurrects that concept by permitting the governing body to select a provider of electricity which then becomes the default provider for everyone in the community.
PG&E supported AB 117 when it passed in 2002.
In January 2004 the Kings River Community District began investigating a Community
Choice Program and in 2005 began preparing a Business Plan.
Summary: By Kings River Conservation District
Community Choice Aggregation Program
The purpose of the CCA program is to provide electricity customers the opportunity to join together to procure electricity from competitive suppliers with such electricity being delivered through PG&E and the Southern California Edison Company. This is pursuant to enabling legislation AB 117.
Kings River Conservation District will be the exclusive operating agent for the CCA. The
San Joaquin Power Authority will serve as the governing body and will be made up of a
Board of Directors that consists of a representative from each of its members. Citigroup financial will be the chief financing operator.
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Implementation Plan
The implementation process begins with the aggregation process. Customers who live in the city that is a part of the SJVPA will receive two written letters from the SJVPA asking if they would like to opt out of the services. If they choose not to opt out, it is expected they will begin receiving services in September 2007. Customers typically have a 60 day opt out period. If they choose to opt out following the cutover services they will be charged for program charges used while a part of the Authority.
The CCA will operate through a phase-in plan in order to address any problems or unforeseen challenges in the system.
Phase 1: Serve direct electric accounts of sole participants (including all city and county customers) that need a load of 200GWh
Phase 2: Serve large electric users, typically those that need more than 500 kW.
Phase 3: Serving medium sized electrical accounts
Phase 4: Serving all accounts, and is estimated to go on board approximately 6 months after Phase 1.
Rates
Under the SJVPA, the KRCD has set the target reduction at 5%, with a guarantee it will increase at no more than 2% each year. The authority will be responsible for setting all rates for the program to ensure the costs cover total operational costs of the program.
Costs
CCA Program Start up and working capitol: $50 million
Baseload generation project funding: $400 million
San Joaquin Power Authority
The initial participants included in the Memorandum of Understanding, dated March 1,
2005 include: Clovis, Corcoran, Dinuba, Fresno, Hanford, Kerman, Kingsburg, Lemoore,
Parlier, Reedley, Selma, Sanger and Kings County. These participants are the original signatories of the JPA. The MOU members hired an energy consulting firm to do a feasibility review. After the study, the Authority developed an Implementation plan authorized by all members of the study.
The implementation plan and agreement will actually become effective on the date in which the authority has received at least 9 Joint Powers Agreement Parties, which means they must join at the minimum participation level.
Community Power Plant
The Kings River Conservation District is proposing to construct the Kings River
Conservation District Community Power Plant, which will be governed by a San Joaquin
Valley Joint Powers Authority and generate power to all customers who are currently part
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of the municipalities that take part in the Joint Powers Authority. The KRCD will own and operate the power plant.
The 500 mega-watt base-load power plant is designated to run 24 hours a day, 7 days a week and is expected to provide up to 60% of the projected electrical load for the
Community Choice Program. The plant will be located south of the Parlier Wastewater
Treatment Plant on Bethel Avenue between Manning and Dinuba Avenues.
It is expected the plant will emit no visible pollutants and will meet federal and state requirements for emissions. Emission offsets will be acquired to reduce the overall emission impact on the service area to zero.
It is expected to be operational by 2010.
PG&E Concerns Re: Community Choice Aggregation
Rates:
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In the CCA Implementation plan it states that PG&E’s rates have increased by
4.1% per year over the last 27 years, which according to PG&E is not the case.
The truth is that PG&E’s generation costs have been bundled with other costs such as electricity and distribution and transmission, and therefore the generation rate that KRCD has reviewed is inflated. PG&E rates actually show a compounded growth rate of approximately 2% per year.
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CCA has guaranteed to raise their rates no more than 2%, but there is no guarantee or factual evidence they can support that, and in the implementation plan it states the SJVPA can raise rates at any time to meet operational costs.
 If the costs from the SJVPA exceed those of PG&E’s, customers must pay an unknown opt-out fee to switch over. o The 5% initial rate reduction on generation is not a guarantee because the terms of the contracts with KRCD and Citigroup have not yet been confirmed, and it is questionable how those savings will be recovered in the long run.
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By law the CCA must have 20% renewable power by 2010, or pay penalties, will those costs be transferred to the customers?
Exit Fees:
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Exit fees will be charged to customers choosing to leave the service, and if they do so at a time when energy costs rise above market prices customers will have to pay a proportionate share of their above-market costs.
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Exit fees for non-residential customers are different, and possibly much higher; this includes all businesses.
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Member cities and counties that commit to have all of their electric load from the
CCA cannot opt out. If they do choose to opt out, they must leave the JPA entirely, and are responsible for the city member and all of its constituents exit fees as well. (For example, it is estimated the City of Fresno will be required to pay $14.2 million in exit fees)
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Debt:
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Members of the SJVPA and constituents will bear the risks associated with the costs and commitments of the estimated $400 million in bonds that will be needed for the power plant.
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To this point there has not been accurate information regarding the amount of debt issued, length of financing, rates, etc.
Risks:
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KRCD and Citigroup have said they will not reveal any details about their contracts until after cities and counties lock into the CCA because confidentiality is necessary to protect their competitive abilities.
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Who will be responsible for fines or penalties that are applied by a state governmental agency for not meeting a code or permit requirement?
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If the volume required changes due to one or more of the cities leaving the
Authority, how will that impact remaining customers?
Facts:
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PG&E is supportive of a community choice plan, and was supportive of AB 117 when it was issued in 2002.
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PG&E will continue to support and cooperate with communities that proceed with
CCA
PROS:
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The CCA program will provide competition in a market that has been otherwise monopolized.
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If the numbers are correct this would save a number of small and large businesses money in which they could use for other services.
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The CCA will provide an additional power generation project which is needed to insure a sustainable energy supply for the future.
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The CCA will empower a regional body to make decisions and plan for our future regarding energy issues that affect businesses and residents
CONS:
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The only consulting report completed for the project was hired by KRCD; there needs to be another outside entity that looks at the project.
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This project has never been done before in California, so there is no factual evidence of how successful it will be.
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The opt-out program for the customer is burdensome, and eventually charges a fee that is even higher for businesses and local municipalities.
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It is expected that the 500 mega-watt power plant will emit 1.6 billion pounds of CO2 per year.
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ACTION
Agenda Item #2
Government Affairs Council
July 11, 2007
Digital Video Surveillance Systems Ordinance
Sources:
Fresno Police Department
Background:
It has been noted that statistically establishments that are referred to as Type 20 and Type 21, those selling beer, wine, and general distilled spirits are more frequently the targets of commercial robberies due to their practice of handling cash on a 24 hour basis.
During time of robbery often the FPD has found that the video surveillance systems that are being used are inoperable at the time or provide inferior quality images due to the lack of system maintenance.
Summary:
The proposed ordinance would use Conditional Use Permits to require new applicants and existing applicants to transition to a compliant security system as per this Municipal Code. This ordinance would allow existing businesses that do not have any security 12 months to get a compliant security system, and would allow an existing business that already has a system 24 months switch to a compliant security system.
Specifically this ordinance will enforce all Type 20 and Type 21 businesses have the following capabilities:
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All interior cameras shall record in color
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All exterior cameras shall record in color and have automatic lowlight switching capabilities to black and white
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Exterior cameras that should be in weatherproof enclosures and located so they help prevent vandalism
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The recorder must have at least a 7 day recorder of real-time activities
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The system must always have correct date and time
The purpose of this ordinance is to promote public safety by establishing a minimum standard of a digital video surveillance system to insure that criminal acts are made more prosecutable.
Currently, there is not an ordinance in place with these types of restrictions.
Recommendation:
The GAC supports the digital video surveillance systems ordinance.
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