A lengthy legal grind has turned South San Joaquin Irrigation District’s bid to deliver reliable electricity at 15 percent below what PG&E charges to residents, farms, businesses, and schools in the Manteca, Ripon, and Escalon communities into a 10-year odyssey and counting.
While they wait for legal issues to be resolved the district is prepping for the eventuality of their efforts to purchase the PG&E retail system serving those within the SSJID boundaries succeeding.
Their efforts to place a value on the PG&E assets as required by the California condemnation process that continues to wind through the legal system has given SSJID a good accounting of system shortfalls including aging poles and other equipment and such that the for-profit utility has not replaced.
The detailed analyses of the local PG&E system were factored into not just the purchase offer but what money SSJID will need to spend in order to increase the reliability of the system if they obtain the system.
That cost of needed upgrades — as well as establishing a separation from PG&E intertie with the transmission system and getting manpower in place — have all been factored into exhaustive studies that show it is feasible to deliver more reliable power at lower rates.
Another is the fact they are in the community they serve and not in a distant corporate suite in San Francisco. That, in turn, makes them more responsive and accessible to customers.
SSJID General Manager Peter Rietkerk drove that point home during a recent presentation. Rietkerk noted he “was standing in a room” before some of the people he’d be responsible for providing with reliable power when he addressed the Manteca Rotary this past week.
Rietkerk added that SSJID management, the elected board and the men and women who work for the non-profit irrigation district live in the community and are vested in its success and well-being. And that would be done without the need PG&E has to maintain at least an 11 percent profit margin to keep Wall Street hedge funds happy.
Questions about what SSJID would do regarding aging local PG&E components that one member of the audience described as power poles in front of his home being so old “that woodpeckers avoid them” were raised during the presentation introducing Katie Patterson as the district’s public/government relations manager.
Patterson, who started in November, is tasked with helping continue to communication with the public through the district’s “Powered by Purpose” campaign while the process to enter retail service moves forward at what she described as a “glacial speed”.
Her job also includes working with various government agencies on the local, county, state, and federal levels to protect and further local interests SSJID handles whether it is groundwater management, protecting adjudicated senior water rights, Delta flow issues, or the district’s move into retail power among other concerns.
Patterson is a Ripon resident with a degree in agricultural business from Fresno State. She has worked for the American Farm Land Trust, San Joaquin County Farm Bureau as well as five years with San Joaquin County administration. Patterson has a background in dealing with state agencies and the legislature. She also became versed with water issues while working for the Farm Bureau and county.
Rietkerk noted that SSJID would continue its practice of agreements with nearby agencies to assure adequate manpower when extra help is needed.
Modesto Irrigation District, as an example, has stepped up to assist when the Tri-Dam Project — the series of dams and power plants on the Stanislaus River SSJID operates with Oakdale Irrigation District — experienced issues with its power transmission system.
On the flipside, SSJID was among those that helped Paradise Irrigation District get its system back up and running after the 2018 wildfire aging and faulty PG&E equipment triggered.
“At the end of the day our goal is to keep the lights on and be reliable,” Rietkerk noted in addition to rates 15 percent lower than PG&E’s.
Appeals Court Sides With SSJID
The California Third District Court of Appeals in December overturned a 2017 San Joaquin Superior Court ruling on two cases PG&E filed against the San Joaquin County Local Area Formation Commission.
PG&E had sued in the county court arguing that LAFCO had improperly granted SSJID the authority to enter the retail power business by allowing it to proceed by agreeing with the irrigation district they could keep the cities of Manteca, Ripon, and Escalon “whole” by making sure the 2 percent franchise fees that PG&E paid would continue if SSJID takes over the local system.
Because of that ruling regarding franchise tax fees, the Superior Court also tossed the eminent domain lawsuit SSJID had filed to secure the retail distribution system within their boundaries at market value after PG&E rejected a SSJID offer that irrigation district officials said was above market cost.
The Appeals Court determined it was lawful for the SSJID to pay the fees given they had proven they had adequate revenue from other sources to continue paying what amounts to a 2 percent franchise fee to the three cities. The biggest source of SSJID funds are its share of annual proceeds from the Tri-Dam Project’s wholesale sales from Tri-Dam Project power plants. Some years the two districts have split as much as $15 million. The amount fluctuates due to markets as well as snowpack and storage conditions.
An appeal to the state’s high court aside, the district still has to restart its eminent domain lawsuit against PG&E unless, by chance, the district makes another offer to PG&E and the for-profit utility accepts it.
If an eminent domain lawsuit is successful the courts would set the price SSJID pays for the retail distribution system.