Staff Report
PREPARED BY: MATT MORLEY
PARKS AND PUBLIC WORKS DIRECTOR
Reviewed by: Town Manager, Town Attorney, and Finance Director
110 E. Main Street Los Gatos, CA 95030 ● 408-354-6832
www.losgatosca.gov
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
MEETING DATE: 2/07/2017
ITEM NO: 10
DATE: FEBRUARY 2, 2017
TO: TOWN COUNCIL
FROM: LAUREL PREVETTI, TOWN MANAGER
SUBJECT: UPGRADE OF THE TOWN’S ELECTRICITY ACCOUNTS TO SILICON VALLEY
CLEAN ENERGY’S GREENPRIME SERVICE
RECOMMENDATION:
Upgrade of the Town’s electricity accounts to Silicon Valley Clean Energy’s GreenPrime service.
BACKGROUND:
On February 2, 2016, the Town Council approved the Town ’s participation in a regional Joint
Powers Authority (JPA) called Silicon Valley Clean Energy (SVCE). The goal of SVCE is to act as
the electricity procurement authority for all participating jurisdictions, taking over this role from
Pacific Gas & Electric (PG&E). This allows for greater flexibility in the electricity purchased, with
a focus on reducing Green House Gas (GHG) emissions and increasing the amount of renewable
energy purchased beyond what PG&E provides.
Vice Mayor Rennie was appointed as the Town’s representative on the JPA Board and since its
inception SVCE has continued to move towards the goal of distributing green electricity. The
current schedule calls for implementation in three phases, with the first phase b eginning in
April, 2017.
DISCUSSION:
The SVCE program is an “opt out” program, meaning accounts are automatically enrolled unless
account holders act to take a different direction. Account holders will automatically be
subscribed to the GreenStart program unless they opt for a different program. The Town needs
to decide which program to subscribe to for municipal accounts.
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SUBJECT: UPGRADE OF THE TOWN’S ELECTRICITY ACCOUNTS TO SILICON VALLEY
CLEAN ENERGY’S GREENPRIME SERVICE
FEBRUARY 2, 2017
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DISCUSSION (cont’d):
The default program, called GreenStart, will be 100% carbon free, sourced from 50% renewable
power sources and 50% hydroelectric power. Unless other actions are taken, customers will be
automatically enrolled in SVCE’s GreenStart program. By comparison, PG&E’s current electric
service is approximately 30% renewable and 60% carbon-free. The estimated cost for
GreenStart service will be approximately $0.001/kilowatt hour (kWh) less expensive than PG&E
service. As such, SVCE will provide cleaner, greener electricity at a cost lower than PG&E.
SVCE will also provide a 100% renewable, carbon free program called GreenPrime. GreenPrime
will be sourced entirely from renewable energy sources as defined by the State of California.
SVCE customers will have the option to upgrade to GreenPrime service, at an estimated
premium of $0.007/kWh to PG&E’s current service, or $0.008/kWh when compared with SVCE
GreenStart.
Because of the complexity of the electric rate schedule across numerous accounts and the
portion of the bill used for comparison purposes (generation versus transmission and other
costs), the clearest basis for comparison is based on estimated savings. These savings are an
average across all Town municipal accounts and will vary depending on future rate adjustments
and usage patterns. The comparative costs to the Town are highlighted in the following chart:
Program Comparative Annual
Cost (Savings)
GreenStart ($2,637)
PG&E (current rates) $0.00
GreenPrime $18,456
The Town’s annual PG&E electrical costs total approximately $500,000. These are ongoing
operational costs within the General Fund. If the Council elects GreenStart, the General Fund
will experience estimated savings of $2,637 per year. If the Council elects to upgrade to the
GreenPrime option, the General Fund will experience estimated increased expenses of $18,456
per year.
Of the twelve members of SVCE, seven have already opted for the GreenPrime service. The
GreenPrime service also aligns with the Town’s General Plan (Goals ENV -13, 14, and 16) and
Sustainability Plan, allowing for significant inroads towards the goal of reducing Green House
Gas emissions. Switching to SVCE will reduce Green House Gas emissions by an estimated 970
Metric Tons on Los Gatos municipal accounts alone. This is equivalent to removing 200 vehicles
from the road for a full year.
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SUBJECT: UPGRADE OF THE TOWN’S ELECTRICITY ACCOUNTS TO SILICON VALLEY
CLEAN ENERGY’S GREENPRIME SERVICE
FEBRUARY 2, 2017
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DISCUSSION (cont’d):
Both GreenStart and GreenPrime achieve similar Green House Gas reduction numbers. The
GreenStart program relies on hydropower, which is not considered as desirable a source of
electricity because hydropower creates environmental impacts by requiring dams to generate
the electricity. Impacts from dams include the flooding of wildland and inhibiting fish migration
through the rivers. Both programs help to advance the Town’s General Plan and Sustainability
plan goals.
The recommendation to upgrade to GreenPrime is based on the opportunity for the Town to
demonstrate extreme leadership in environmental initiatives.
CONCLUSION:
Staff recommends that the Town Council authorize the upgrade of the Town’s electricity
accounts to Silicon Valley Clean Energy’s GreenPrime service.
ALTERNATIVES:
Alternatively, the Council could direct staff to upgrade to the GreenStart program or to opt out
of the program and remain with PG&E as the Town’s electricity provider.
COORDINATION:
This report has been coordinated with the Finance Department.
FISCAL IMPACT:
The recommended action will result in increased General Fund expenses of approximately
$4,614 which may require a budget adjustment to be recommended in the mid-year budget
report for the pro rata period in FY 2016/ 2017 and an increase of $18,456 in ongoing annual
expenditures beginning in FY 2017/ 2018 that will need to be incorporated into proposed FY
2017/18 budget.