Public Power Delivers Renewable Electricity at Lower Cost | Local Clean Energy Alliance of the Bay Area

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Public Power Delivers Renewable Electricity at Lower Cost

Public power utilities in the Bay Area, including Alameda Power and Telecom (AP&T), Palo Alto Utilities, and Silicon Valley Power, are able to provide more renewable energy at lower rates than PG&E. AP&T’s power mix already includes 57% renewable (41% geothermal, 9% biomass & waste, and 6% wind). The remaining balance is 28% large hydropower, 8% coal, and 7% natural gas. The Palo Alto Green program offers a California blend of 97.5% wind and 2.5% solar generation at an additional cost averaging less than $10 per month.[1] Silicon Valley Power’s Santa Clara Green Power offers energy from wind and solar projects in Northern and Southern California for an additional $0.015 per kilowatt-hour. The table below summarizes the price differences between rates offered by these utilities and PG&E.

Table 1. Comparison of Business Rates for PG&E, Alameda Power & Telecom, and Palo Alto Utilities

Basic commercial service

Energy Charge ($/kWh)

PG&E costs more

Average

Summer

Winter

Alameda Power & Telecom

$0.14107

N/A

N/A

+21%

Palo Alto Small Commercial

$0.13353

$0.14045

$0.12661

+28%

Palo Alto Small Commercial Green

$0.14853

$0.15545

$0.14161

+15%

PG&E

$0.170815 

$0.19589

$0.14574

0%

Sacramento Municipal Utility District

$0.1250

$0.1271

$0.1230

+36%

Silicon Valley Power (first 800 kWh)

$0.15136

N/A

N/A

+13%

Santa Clara Green Power (first 800 kWh)

$0.16635 

N/A

N/A

+3%


The state of California agrees that electricity from public power is cheaper than that from utility companies. According to the California Energy Commission, the levelized costs [2] for electricity generation is usually less for publicly owned utilities (POUs) than utility companies and some renewable technologies (such as wind, small scale hydro) are less expensive for POUs than natural gas generation is for investor owned utilities (IOUs).[3] As shown in Table 2, the POU cost of wind power at 6.14 cents per kWh is 9% lower than the IOU cost of wind generation and 35% lower than the IOU cost of conventional combined cycle generation.

Table 2: Rate Differences Between Publicly and Investor Owned Utilties

 

Technology

Size (MW)

Levelized Cost of Electricity Generation (Cents per kWh – 2007 Nominal Dollars)

Investor Owned Utility (IOU)

Publicly Owned Utility (POU)

Conventional Combined Cycle (CC)

500

9.45

8.68

Hydro Small Scale

10

11.81

8.71

Solar Photovoltaic (Single Axis)

1

69.56

46.89

Wind Class 5

50

6.72

6.14

 

Current trends, both environmentally and economically, underscore the importance for our cities to localize power production, and to take control of power purchasing.

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<!--[if !supportFootnotes]-->[1]<!--[endif]--> 97.5% wind power does not actually mean that 97.5% of the electrons used by that specific household come from wind. The utility simply buys the amount of extra wind power for their 100% renewable customers, which then gets put into their local grid, to be used by nearby customers.

<!--[if !supportFootnotes]-->[2]<!--[endif]--> The present value of the total cost of building and operating a generating plant over its economic life, converted to equal annual payments in real dollars (adjusted to remove the impact of inflation).