Utility Agreement Rally
Councilmember Monica Montgomery Steppe addresses the crowd at City Hall Monday. Photo via @sdclimateaction Twitter

A coalition of activists rallied with several San Diego City Council members at City Hall Monday in favor of securing an equitable, climate-friendly utility franchise agreement deal.

San Diego Gas & Electric, which has provided gas and electric utilities to San Diego since 1920, was the only company to make a bid for the franchises when they were opened Friday.

The franchise agreements allow the utility company to use public right-of-way for its infrastructure. SDG&E made minimum bids of $70 million for the electric franchise agreement and $10 million for the natural gas agreement.

“If necessary, I stand ready to enter into negotiations with the bidders with the ultimate goal of presenting final bids to the City Council in the coming weeks,” Mayor Todd Gloria said Friday.

The group that rallied at City Hall contend that allowing SDG&E — a subsidiary of San Diego-based Sempra Energy — to have a 20-year franchise agreement deal would be “disastrous.”

“A good deal would be short, hold SDG&E accountable, support San Diego’s climate goals, protect utility workers and invest franchise funds in communities of concern to achieve more equitable clean energy and public health outcomes,” said Heather Hofshi, a volunteer with SanDiego350 — a nonprofit dedicated to preventing the worst impacts of climate change.

The activists want a much shorter pact than the 20-year deal Gloria floated as a compromise. Previous agreements were for 50 years each, signed in 1920 and 1970. The current deal was slated to expire in January, but a six-month extension was agreed to by SDG&E after Gloria rejected an initial bid for the same dollar amounts as the second round of bids.

The rally featured speeches by San Diego City Council members Monica Montgomery Steppe, Sean Elo-Rivera and Joe LaCava.

“Where the agreements stand today isn’t close to good enough. SDG&E needs to make good on their prior promises, they need to guarantee our utility workers the protections they deserve, and our city needs a straightforward and streamlined way to hold our franchisee accountable,” Elo-Rivera said.

SDG&E has pledged to have net zero greenhouse gas emissions by 2045 and on Monday announced several projects intended to boost the company’s sustainability.

“Getting to a net zero future is the moonshot challenge of our era and one that the SDG&E team fully embraces,” said SDG&E CEO Caroline Winn.

“SDG&E has worked hard to align our investments with the climate objectives of local cities, the region and state and while there is a lot more work to be done, we are seeing many clean energy innovations emerge, and progress being made toward our mutual goal of a 100% clean energy future,” she said. “While we’ll continue to evolve our efforts to reflect stakeholder feedback, regulatory changes and technological breakthroughs, I believe we can get there … one project at a time.”

The company will begin construction this year on two hydrogen pilot projects and anticipates putting them into service in 2022.

The Borrego Springs Green Hydrogen Project is intended to demonstrate hydrogen’s use as long-duration energy storage, a microgrid asset and a resource for dispatch by the California Independent System Operator to support grid reliability. The Palomar Green Hydrogen Systems Project is intended to demonstrate the blending of hydrogen with natural gas as fuel for an electric generator, as well as onsite production of green hydrogen for use as a cooling gas. Additionally, SDG&E will install its first hydrogen fueling station to support the first fuel cell vehicles in its fleet.

The activists cast a critical eye on the projects.

“SDG&E’s franchise bid response is nothing more than vague commitments to corporate greenwashing,” said Matthew Vasilakis, co-director of policy at Climate Action Campaign.

“There are no serious strategies to phase out methane gas, building out local clean energy or advancing climate equity in their proposal,” he said. “The city is walking into another bad real estate deal that will haunt us for decades unless the mayor and City Council intervene.”

SDG&E employs around 4,400 in the region.

Any action taken by the council on the city’s franchise agreements must pass with a two-thirds majority vote.

— City News Service contributed to this article

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