Sonoma Clean Power expands board, adopts revised startup plan

Sonoma County’s public electricity supplier, Sonoma Clean Power, marked the beginning of its first full calendar year of operations Thursday with a newly expanded board to accommodate three more participating cities and a financial outlook that projects the agency to have nearly $45 million in reserves after four years.

Supervisor Susan Gorin, the outgoing chairwoman of the power agency board, summed up the past year, in which the agency began serving 160,000 Sonoma County power customers and persuaded all eligible cities to join after some tough political wrangling.

“It’s a new era for Sonoma Clean Power,” said Gorin, who will remain a board member. “It is so exciting now that we have all of our cities joining us.”

Healdsburg, which has its own municipal utility, is not eligible to participate in the agency.

New board members Don Schwartz of Rohnert Park and Dave King of Petaluma were sworn in Thursday after their cities voted late last year to participate in the agency that aims to capture at least 80 percent of PG&E’s electricity customers in the county by providing power from cleaner sources at competitive rates. Sonoma Clean Power will take over as the default supplier in Rohnert Park, Petaluma and Cloverdale this summer. Customers have a choice to opt out and stay with PG&E as an electricity supplier.

To serve the new cities and the bulk of the agency’s customers that came online in December, Sonoma Clean Power is expecting to spend $118 million on energy this year, or three times what it spent last year.

“We’ve just become a fairly significant power provider,” said Geof Syphers, Sonoma Clean Power CEO. “That’s exciting.”

The agency expects to spend $149 million on power by 2018, according to a revised startup plan approved by the board of directors Thursday. The state Public Utilities Commission needs to sign off on the plan before the three new cities can receive service this summer. Factoring in revenue from selling electricity, the agency predicts it will have a $45 million surplus by the end of 2018.

Syphers said the reserves help bolster Sonoma Clean Power’s credit rating and allow it to negotiate more favorable long-term power contracts. The board has a policy of keeping up to $50 million in reserves, and would need to set a new policy to decide how to spend surpluses over that amount, Syphers said.

Agency officials and backers have discussed different spending priorities that ultimately will define the future direction of Sonoma Clean Power, including buying a greater amount of green power to reduce greenhouse gas emissions, investing in local renewable power projects and funding programs to subsidize customer rates.

“Our job is to find the most efficient way to bring benefit to the community,” said Mark Landman, the Cotati councilman who was elected chairman of the Sonoma Clean Power board Thursday.

Syphers called Gov. Jerry Brown’s recently announced goal for California utilities to use 50 percent renewable energy by 2030 “fantastic” and said he was confident Sonoma Clean Power would meet that goal well before the deadline. The agency currently purchases 33 percent of its energy from renewable sources, which is the standard that utilities in the state are required to meet by 2020.

As the agency begins offering power to all eligible customers, it is keeping an eye on opt-out rates, which currently stand at 7 percent. Officials predict about 15 percent of customers will choose to leave Sonoma Clean Power and go back to PG&E, the ?investor-owned utility that has long dominated the Northern California power market.

PG&E will continue to maintain the electric grid and deliver electricity to Sonoma Clean Power customers, who are currently paying power rates 5 to 8 percent cheaper than those of PG&E.

After the agency sent out enrollment notices last year that were widely criticized for looking like easily discarded junk mail, Syphers said new customers will receive notices that resemble government letters. Sonoma Clean Power will send out two of the colorful postcard-style notices and two letters to each new customer coming online this summer.

“The notices include all the feedback we have heard,” he said. “We want to try and hit that stride to make sure everyone has a chance to hear about their options.”

You can reach Staff Writer Matt Brown at 521-5206 or matt.brown@pressdemocrat.com. On Twitter ?@MattBrownPD.