Council to decide on Community Choice Energy

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What: Davis City Council meeting

When: 6:30 p.m. Tuesday

Where: Community Chambers, City Hall, 23 Russell Blvd.

Watch it: Live on Comcast Channel 16 or AT&T U-Verse Channel 99, or as streaming video at www.cityofdavis.org/media

Davis could roll out its own locally controlled Community Choice Energy program very soon, pending a vote from the City Council at Tuesday’s meeting.

A CCE could help reduce energy rates for residents and businesses while drawing on more renewable energy sources. The program would create a locally run nonprofit to provide electricity while working alongside PG&E, which would continue to deliver the power through its infrastructure and handle all billing and collections.

PG&E would continue to meet all of Davis’ natural gas needs.

The program would be closely modeled after a similar energy programs cropping up across the state. Marin Clean Energy was the first to launch, first delivering energy to customers in 2011. It was followed closely by programs in Sonoma and the city of Lancaster.

Under a CCE, residents would see an energy portfolio with at least 50 percent coming from renewable sources while enjoying up to an 8.7-percent reduction on their energy bills over a 10-year period. Locals also could have the option to scale up their percentage of renewable energy, at an extra cost, or to opt out of the program entirely and receive all their energy from PG&E.

Over the same  period, the city also would build up a 4-percent reserve from the program’s annual profits, which would be earmarked for investing in local green infrastructure.

After more than a year of devising a Davis-specific plan, city staffers and consultants found that the most favorable program would serve the city of Davis as well as unincorporated Yolo County. The Yolo County Board of Supervisors voiced unanimous support for the CCE program at their March 8 meeting, the city reports.

On the financial end, a CCE would come with $2.5 million to $3.5 million in start-up costs, the city reports. That sum would take ratepayers three to five years to pay off.

In the technical report for the program, released last month, consultants found that all options for a Davis CCE program penciled out. Even if the program fails, any energy contracts purchased by the city would be considered an asset, and could be sold. Meanwhile, the city could revert to back PG&E’s current service.

If the council approves the program Tuesday night, the program will move into the next phase — creation of a joint-powers agency with the county and an RFP for energy services.

If the council chooses to establish a CCE, residents would be automatically enrolled in the program. Residents would be given several opportunities to opt out if they prefer to stay with PG&E. Deliveries could begin as early as March 2017.

— Reach Felicia Alvarez at [email protected] or 530-747-8052. Follow her on Twitter at @Felicia_A_

Council to decide on Community Choice Energy

Treasury alludes to tax avoidance cases as reasoning behind community energy relief cuts

By Liam Stoker

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30 October 2015, 12:15 Updated: 30 October 2015, 12:25

The Treasury has suggested that cases of individuals or companies using community energy schemes as vehicles for tax avoidance has triggered this week’s decision to cut relief mechanisms.

On Monday amendments were placed into the new Finance Bill between its second and third reading, making community energy projects exempt from receiving EIS, SEIS and SITR tax relief as of 30 November.

The cuts were resoundingly criticised by the industry, which labelled them “extremely damaging”, however financial secretary to the Treasury David Gauke indicated that apparent “misuse” of the scheme was the motive behind the decision.

And in a statement issued to Solar Power Portal, a Treasury spokesman said that the government had become aware of “significantly increased interest” in the use of participating in community energy schemes for “low-risk tax planning purposes”.

HMT said that preventing such abuse was the reasoning behind the changes, which were made in order to “ensure they remain effective at delivering investment to high-risk businesses that need funding to develop and grow, while protecting taxpayers from potential abuse”.

“The government is committed to supporting the investment and innovation needed to achieve a cost-effective transition to a low-carbon economy, but we also want to do this in a way that is fair and provides value for money to hardworking taxpayers,” the spokesman added.

The Treasury has yet to reply to more specific questions on the matter, including whether or not the department had conducted any internal impact assessment prior to making the decision.

The stance is unlikely to appease community energy campaigners who rely almost solely on share issues to investors in order to raise the required funds. With just a month until eligibility for tax relief is removed projects that have failed to raise sufficient funds face an uncertain future. Mongoose Energy managing director Jan-Willem Bode told SPP earlier this week that as much as half of his company’s pipeline faced uncertainty as a direct result of this law change.

Meanwhile Edinburgh Community Solar Co-op has urged new investors to sign up prior to the closure of tax relief, stating that “time is certainly off the essence”.

Depending on an individual investor’s circumstances the Edinburgh scheme proposes returns of between five and seven per cent, however these will fall given cuts to the tax relief measures and the programme is some distance off its target, so far raising just £124,000 of its £1.4 million aim.

Treasury alludes to tax avoidance cases as reasoning behind community energy relief cuts