Customers who are automatically enrolled in San Francisco’s ambitious green energy program will have to pay significantly more than was expected when supervisors approved the program less than three months ago.
The adjusted rates were released last week by the San Francisco Public Utilities Commission, the agency charged with implementing CleanPowerSF, a program designed to offer 100 percent renewable energy to residential consumers at an additional cost.
CleanPowerSF was approved Sept. 18 in a contentious 8-3 vote of the Board of Supervisors. Carmen Chu, Mark Farrell and Sean Elsbernd opposed the program, and Mayor Ed Lee expressed concerns about residents being forced into the program and not being able to afford it. Under state law, customers will automatically be enrolled into the program at the time of its expected October 2013 launch, and they will be given four opt-out notices before and after enrollment.
The surcharge that customers will pay depends on how much energy they use. In September, the agency said customers’ bills would increase by between $9.55 and $77.86 per month. But officials now think that rates will cost between $11.54 and $94.10 more than the comparable energy from PG&E.
The new rates reflect changes supervisors made when they approved the program. Chu wanted to ensure that the program’s rates repay The City’s $13.5 million security deposit, while Supervisor Jane Kim wanted a separate rate schedule for low-income consumers.
And CleanPowerSF faces other threats to its success beyond higher-than-expected rates. PG&E, which has fought to defend its residential power monopoly, plans to launch a competing green energy program around the same time. City officials worry that PG&E shareholders could fund a sizeable anti-CleanPowerSF effort.
Green power advocates worry that The City is setting itself up for failure.
“We are going to get beat up,” said Eric Brooks, a Green Party member and renewable energy advocate. “The average consumer is not going to understand when we say, ‘Yeah, theirs is cheaper, but our 100 percent green is better than their 100 percent green.’ … The customer is going to pick PG&E.”
Brooks and other advocates have long called on The City to start building renewable energy projects to keep the rates lower than those now proposed. But The City’s program envisions a renewable energy infrastructure built years after CleanPowerSF is up and running.
The SFPUC plans to conduct a survey in January to gauge consumer response to the increased rates and how people feel about the program compared to PG&E’s possible competitor.
“San Franciscans are willing to pay a premium for a premium product,” said Barbara Hale, assistant manager of power for the agency.
In March, the Board of Supervisors will be asked to vote on revised energy rates. Following that vote, The City is expected to sign a 4.5-year deal with Shell to provide the program’s energy.
The program is strongly backed by San Francisco’s progressive political faction.
Supervisor John Avalos said it is “our greatest tool to really assure that we are doing our part around climate change.”
Program’s costs climbing
The proposed rate surcharge associated with buying 100 percent green power from San Francisco’s forthcoming CleanPowerSF program has increased by an estimated 20 percent.
|Average monthly usage||Original rate surcharge||New rate surcharge|
|Tier 1||138 kWh||$9.55||$11.54|
|Tier 2||288 kWh||$20.01||$24.19|
|Tier 3||406 kWh
|Tier 4||606 kWh||$42.06||$50.83|
|Tier 5||1,122 kWh||$77.86||$94.10|