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PG&E for years relied on SSJID for cheap power

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POSTED November 20, 2014 12:47 a.m.

Back before deregulation, rolling brown outs, power market manipulations costing  Californians billions upon  billions of dollars  and skyrocketing PG&E bills there was a promise.

In exchange for securing two legislative votes to pass a bill to deregulate electricity in California, PG&E and other for-profit utilities promised to work with irrigation districts to exempt them from competitive transmission charges (CTC) for a set period to allow them to ease into retail power sales.

It was seen by lawmakers as a way for irrigation districts with the wherewithal to offer customers less expensive power. 

No sooner had the ink from the pen Governor Gray Davis used in 1996 to sign deregulation into law, PG&E started reneging on the CTC exemptions that they had written into the bill to secure its passage.

Only one irrigation district with the resources and foresight to understand they could deliver cheaper power for their constituents stepped forward – the South San Joaquin Irrigation District.

At the time, PG&E had been a customer of SSJID’s via the Tri-Dam Project they operate with Oakdale Irrigation District for more than 40 years. PG&E had come to depend on SSJID and OID for inexpensive and reliable electricity that they turned around and sold for a large markup to retail customers.

In fact, the cost per kilowatt hour of hydro-power coming from the Tri-Dam Project was significantly lower than what PG&E could produce on its own at many of its hydroelectric plants.

PG&E never questioned the ability of SSJID to deliver inexpensive and reliable power for the half century they relied on SSJID to shore up their profits. They never questioned SSJID’s expertise or the numbers generated by SSJID consultants regarding how Tri-Dam was operated.

Now that SSJID is posed to eliminate the middle man – PG&E – and deliver the benefits of the Tri-Dam system directly to the 105,000 people living in Manteca, Ripon, Escalon and the surrounding countryside PG&E’s propaganda machine is going into hyper overdrive trying to  discredit SSJID. If you listen to PG&E, SSJID is tottering on collapse and couldn’t hack into a computer – like PG&E had done to SSJID’s computers on their behalf by a consultant – to save their life.

They are doing their best to smear SSJID – an agency owned by the people of the South County that for 105 years has been a reliable provider of water that includes a stretch of more than two decades without raising rates – before a three-day hearing on fate of the SSJID retail power plan nears.

It takes place Dec. 9, 10, and 11 before the San Joaquin Local Agency Formation Commission.

SSJID knows a lot about PG&E deception.

They’ve been dealing with it nonstop since 1996.

PG&E worked with SSJID first to provide an inter-tie to their system near Delicato Vineyards so SSJID could take advantage of the CTC exemptions to get into retail power sales. But at the last minute, PG&E pulled the rug out from under them.

Next SSJID looked at purchasing a substation owned by Heinz near the shuttered Tracy tomato processing plant. PG&E worked with them again until the effort got to the point of being finalized and they again pulled the rug out from under them.

When SSJID started looking at other options that would essentially add customers at a rate of perhaps a hundred per year as growth occurred in South Manteca by working with an interconnect with Modesto Irrigation District, PG&E offered to sell them a part of the local system to get them started with instead.

That system was the rural area south of Manteca that had hundreds upon hundreds of poles dating back to the 1920s and was considered the oldest in the PG&E system. Power outages in the area were commonplace. SSJID didn’t bite.

Instead, they had additional experts – many used by PG&E in various instances without PG&E ever questioning their accuracy or abilities – to re-examine their premises. The numbers showed for the third time SSJID could deliver lower power costs by at least 15 percent across the board. The same experts gave SSJID the thumbs up when it came to being able to operate a retail system.

So the SSJID board recommitted itself to the idea that all local residents should share in the benefits of Tri-Dam to the tune of lower power costs that would cut $12 million annually and put money back into the collective pockets of seniors on fixed incomes, families, businesses, government agencies, and farmers.

It is the same careful analysis and tenacity that the SSJID used 105 years ago to secure water rights and build reservoirs, 89 years ago to build Melones Reservoir, and 60 years ago to develop Tri-Dam.

It is why as we go into the fourth year of drought that Manteca, Ripon, and Escalon are better situated than most of the rest of California when it comes to water.

The SSJID board now wants to do the same thing when it comes to electricity.

SSJID has a proven 105-year track record of dependable service, long-range innovative thinking, and low costs. It has never been on the cusp of bankruptcy. With an undistributed reserve pushing $60 million SSJID has almost 2.5 times the funds on hand that it costs to operate the district every year.

PG&E – which exists primarily to generate profit for its shareholders and pay for $12 million bonuses and executive jets for its corporate suite – can’t match SSJID for financial stability or dependability.

That is what the LAFCO board needs to keep in mind next month.

 

This column is the opinion of executive editor, Dennis Wyatt, and does not necessarily represent the opinion of The Bulletin or Morris Newspaper Corp. of CA.  He can be contacted at dwyatt@mantecabulletin.com or 209.249.3519.

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