Marin Energy Authority begins negotiations with energy suppliers

The Marin Energy Authority has narrowed its search for a wholesaler to sell it the electricity it needs to compete with Pacific Gas and Electric Co.

The authority's board voted unanimously this week to select three companies from the dozen that submitted bids. The finalists are Baltimore-based Constellation Energy Commodities Group, Houston-based Macquarie-Cook Power and Shell Energy North America, a subsidiary of Royal Dutch Shell, which has its headquarters in The Hague, Netherlands.

The economic downturn may work to the authority's advantage in its negotiations, said Dawn Weisz, the authority's interim director.

"We will be buying our power now while the prices are low, and existing utilities are paying for power they purchased a few years back when the price was high," Weisz said.

In addition to pricing, financial viability, operational experience and access to renewable energy supplies were deciding factors.

Marin County Supervisor Charles McGlashan, who has helped lead the effort, said, the three finalists "are able to offer the price and quantity of renewable power that we need, and that's good news."

In October, the Marin County Board of Supervisors is scheduled to consider allocating another $170,000 to the authority. A year ago, the supervisors approved an allotment of $330,000. The county will get a significant portion of the money back if the authority goes forward to successfully sell its own electricity.

The Marin Energy Authority was formed
last year to explore projects to reduce greenhouse gas emissions. Chief among those projects would be the Marin Clean Energy initiative, which calls for the authority to compete with PG&E as the retailer of electricity.

Prior to receiving bids, the authority's consultants estimated that customers who join Marin Clean Energy would have a choice of using 100 percent renewable power by paying 8 to 10 percent more than what PG&E is charging for electricity. The authority also plans to offer customers a "light green" option, which would maximize the percentage of renewable power used while matching PG&E's rate.

"That is still true," Weisz said. "In fact, it looks like we might be able to supply the 100 percent option at a slightly lower premium than expected."

PG&E recently informed the California Public Utilities Commission that it will be unable to meet the state-mandated requirement of getting 20 percent of its energy from renewable sources by 2010, Weisz said.

The plan is to have the authority board approve a draft contract with one of the three energy suppliers by Oct. 1. Once that draft is approved, authority staff members will begin meeting with the city councils of its members to discuss the document. The authority's members include the county of Marin and every municipality in Marin except Novato, Larkspur and Corte Madera

The authority's board is scheduled to vote on a final contract on Nov. 4. After that, authority members will have 90 days to opt out. Marin residents who live in cities that don't sign the contract will not have the option of purchasing their electricity from the authority. However, residents who live in cities who do sign the contract will have the option of keeping PG&E as their energy supplier.

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