South San Joaquin Irrigation District’s drive to reduce electricity rates 15 percent across the board in Manteca, Ripon, and Escalon is on pause until mid-January.
“We (the district) won’t be making any moves until after the appeal period comes to a close,” noted SSJID General Manager Jeff Shields.
PG&E has 30 days in which to appeal the decision made Dec. 11 by the San Joaquin County Local Agency Formation Commission giving SSJID the green light to enter the retail power business within its service territory.
Shields confirmed the board did discuss strategy during a closed door session last week about the retail power move. State law allows elected boards such as the SSJID members to meet behind closed doors to discuss negotiations including potential terms.
Shields indicated the board is hopeful that PG&E will opt to negotiate instead of triggering legal battles.
The main issue is expected to be the price PG&E will get paid for its infrastructure within the irrigation district’s boundaries.
During the LAFCo process the debate over the price for the system has ranged from a book value of $48 million based on a 2009 study to claims at some points by PG&E spokespeople during the past four years that it was worth as much as $450 million.
Shields expects the price to be higher than the 2009 study mainly because PG&E has been making upgrades to the system serving the three communities.
Should the matter go the meeting domain route and end up in court, previous judicial decisions have put an upper selling of roughly 1.5 times the book value for what PG&E receives when a local agency takes over part of their service territory as they did in Trinity County, Susanville and Hayfork.
Just recently PG&E itself bought the City of Hercules electrical retail power system for 1.28 times over book value.
Book value sets a price on the system’s infrastructure taking into account age and depreciation among other things.