The cities of Gilroy and Morgan Hill were among 11 Santa Clara County cities, which, along with the county government, last month were repaid in full the startup loans from Silicon Valley Clean Energy, the public non-profit “community choice” energy agency that now provides most electricity to most county residents.
As part of an agreement that formed Silicon Valley Clean Energy in 2016, the energy agency—which provides cleaner power at competitive costs—the county’s municipalities loaned $2.7 million to provide the agency with initial working capital.
The loan agreement gave the agency four years from the effective date of the agreement, or March 2020, to pay back the loan. However, all funds were returned in January 2018, more than two years ahead of schedule, and within the agency’s first year of operation.
The cities of Gilroy and Morgan Hill each received checks for $100,000, their share of the startup loan.
The agency also secured an $18 million revolving line of credit and a $2 million non-revolving line of credit, both of which were retired in late 2017. The loans allowed Silicon Valley Clean Energy to get up and running and pay for startup costs, which included power procurement, staffing, marketing and outreach, the agency reported this week.
“Returning our startup loans well ahead of schedule and being debt-free in less than a year shows that Community Choice Energy is a viable model,” says Rob Rennie, Silicon Valley Energy Board Chair. “When forming this agency, we were focused on the significant greenhouse gas reductions having carbon-free electricity would provide, but our communities will gain additional benefits with [our agency] reinvesting net revenues in our local economy and providing customer programs.”
Community choice energy agencies in California are funded by ratepayers through electricity sales, and do not rely on taxpayer funds.
The agency is locally governed by a board of directors comprised of one elected official from each member community.
Since launching service in April 2017, SVCE now serves more than 242,000 commercial and residential electricity customers in 11 Santa Clara County towns and cities, and unincorporated county communities with carbon-free power—97 per cent of all customers in the service area.
Silicon Valley electric generation rates are 1 percent less than PG&E’s equivalent rate, providing an estimated $3.4 million dollars of on-bill savings to customers, according to the agency.
Silicon Valley Clean Energy customers still get billed by PG&E and pay PG&E for electricity transmission and delivery. It is now just a new line item of the bill that replaces PG&E electric generation charges. Customers pay SVCE on a line item on the PG&E bill called “Silicon Valley Clean Energy Electric Generation Charges.”
Customers with questions about how to understand SVCE generation charges on their bill can visit svcleanenergy.org/your-bill or call 1-844-474-7823 (SVCE).
Silicon Vallley Clean Energy’s GreenStart electric generation service offers 50 percent renewable energy that is 100 percent carbon free, Tobin continued. For a higher rate, residential and commercial customers can choose to upgrade to SVCE’s GreenPrime program, to receive 100 percent renewable power.
In comparison, PG&E’s existing service offers 60 percent carbon-free, 30 percent renewable energy.