Dive Brief:
- San Diego's plan to form a community choice aggregation (CCA) program offering a 100% renewable option may be feasible, but it could wind up costing consumers $2.8 billion, according to a new analysis commissioned by Sempra Services.
- However, San Diego Gas & Electric is also owned by Sempra, and is the current provider of the city's electricity.
- The analysis was completed by Fermanian Business & Economic Institute at Point Loma University, which points out San Diego would only reach 51% renewables by 2035 — only halfway to its 100% goal.
Dive Insight:
San Diego's proposal to develop a CCA with 100% renewable options may be feasible, but according to the Fermanian analysis, it could come with a very high price.
According to the analysis, the CCA would generate negative value for customers in all but two of 11 cases examined. And in one of the scenario that included modeling a high procurement cost, the program could wind up costing consumers almost $3 billion.
A study released by the city this summer found it is "feasible" that the CCA program will be able to meet the majority of the city's Sustainable Energy Advisory Board's recommended minimum performance criteria, including GHG reductions and having an energy supply that is 100% from renewables.
"The analysis San Diego is using to potentially move forward with the plan is deeply flawed," Lynn Reaser, chief economist at Fermanian, wrote in a recent op-ed explaining the study's findings. The analysis "found flaws in all of the study’s conclusions regarding the feasibility of community choice aggregation for San Diego and a notable lack of supporting data."
In August, San Diego County released a draft Climate Action Plan that aims to cut greenhouse gases in unincorporated communities and in county government operations, and boost renewable energy to 90% by 2030. The county plan follows the city's pledge last year to switch to 100% renewable energy by 2035.
