Did the Newsom administration ever offer their appointments to the PUC yet? Did the Supervisors approve them?

The tax-break issue is the thing that most annoys me. WHy can a private company get tax money when a public project can't? I think the supervisors ought to be pushing Nancy Pelosi to get us $12 million in federal money so the city can build the project just a cheap as a private contactor.

Same jobs. Same solar. But the city owns and controls it, and it's cheaper in the long run.

There is a very good reason why the SFPUC wants to use a power purchase agreement (PPA) to build the Sunset Solar Project. It’s the only way the city, as a non-tax-paying entitity, can take advantage of the 30% federal investment tax credit. And for this project, the tax credits deliver about a $25 million dollar savings. Fact.

The city is of course free to try and issue a general obligation bond to pay for a city-owned solar system. Doing so would result in the same covenant to make long-term annual payments that's contained in the PPA, but would cost the city about $25 million more. Read the budget analysts report. Or do the math youself. If you are having trouble with the calculations, use this tool developed by the National Renewable Energy Lab:
https://www.nrel.gov/analysis/sam/

That’s why every single significant solar purchase by public agencies have used PPAs since the federal tax credit was made available. It’s what the Sacramento Municipal Utility District uses. Ditto San Diego, San Diego Unified School district, Anderson Union School District, State of California, Cal Poly San Luis Obispo, CSU Chico, CSU Dominguez Hills, CSUSan Bernardino, University of California Irvine, Chuckawalla Vallley State Prison, Ironwood State Prison, Patton State Hospital, CA Dept of Transportation in Stockton, AC Transit, Port of Oakland, UCSD, Cal Tech, Fresno Airport, city of Santa Barbara, about 20 water districts throughout the state…we could go on. LADWP is absolutley notorious for wanting to own all its generating assets. LADWP’s plan for solar? All PPAs, all the time.

And when Community Choice Aggregation happens for SF, it too would use PPAs in order to harness the tax credits for solar.

If you want to see solar happen for the city, this is the cheapest way for the city to do it.

If you don’t care about cost or don’t want to see solar happen—perhaps a sternly worded resolution condemning global warming instead?—then that’s another matter entirely.

Note that this project, in addition to its environmental benefits, would create 71 green collar jobs. The contractor signed a contract that guarantees that 30% of those jobs come from the most economically disadvantaged zipcodes in the city. This is a standard that no other—let me repeat—no other project before the city comes close to meeting.

This project fights global warming with actual clean electrons, not rhetoric. It gives San Francisco a leadership role in the transition to the clean energy economy with a real project, not aspirational intentions. And it provides jobs, not promises, for poor people.

That’s why Sierra Club, San Francisco Community Power, the Ella Baker Center, Green for All, the Apollo Alliance, the Union of Concerned Scientists, Brighline Defense, the Greenlining Institute, the Vote Solar Initiative, and many other groups working on clean energy all support it.

Tim-

The list of things that annoys me about federal energy policy is a lot longer than that...

The short answer is that tax credits were pushed federally for a very strategic reason: they don't need appropriation. There are a lot of bills that pass out of Congress, only to essentially die on the vine because money is never appropriated to fulfill them. With tax credits, there's no worry of that: the money comes from deductions of payment to the fed.

I'd like to ask you why you think this incompatible with public power? It's on city property. The city owns ALL of the production. The city can buy the solar plant after 7 years (when the tax benefits have all been harvested), again at 15 years, and will essentially get it after the 25 year PPA is done. If the City were to buy a solar plant outright, it would still contract with a private company to do the design and installation under a turnkey agreement, so it's not like the alternative would cut private companies out of the picture entirely. I've worked with cities across the country on solar projects, and I've never come across this unique view of PPAs.

The city could ask Pelosi for a federal handout, that's true. However, that would:

A) Take a long time. You'd have to pass a bill, then the appropriation. Then rebid the solar project. Years in the making. People need jobs now. The icecaps are melting now. There's urgency here.

B) Be hard to do. Getting the tax credits was an incredibly difficult endeavor that took years of extremely hard work.

C) That's pork, not an energy policy. The PPA approach is replicable.

D) The Congressional strategy this year is to combine, all in one bill, a federal renewable energy standard, carbon cap and trade, transmission reform, and a low-carbon fuels standard. This bill is the biggest, most transformative piece of energy legislation ever introduced--fundamentally changing how this country produces and uses energy forevermore--and will be mind-bogglingly hard to pass. You have no idea about the amount of money being amassed and the knives being sharpened to fight it. I'm going to go out on a limb and say that Pelosi has a lot on her plate.

Let's not let the perfect be the enemy of the good. I say we take the tools that we have, and get to work building the clean energy economy, fighting global warming, and putting people to work. Now. Not in some indeterminate and distant future when conditions meet all your ideals.

Matt clearly makes valid points on why this ultimately needs to go forward.

However, Tim has a valid point that is really longer-term and shouldn't be used to delay moving this specific project forward: if, in fact, a city has the capability itself of building a solar facility (I don't know that S.F. does, though), why can it not leverage some sort of federal subsidy outside of tax credits?, which would not seem to apply to a municipal government, since it does not pay federal taxes.

Second, Matt does not appear to have addressed the central point that raised the red flag for me as soon as I read Tim's post: Harvey Rose's analysis that "the deal would require the supes to waive their right to oversee annual appropriations for the project, essentially locking the city into spending money on it every year for the next 25 years." What exactly is the point of this? It is incredibly suspicious, and as someone who once managed accounts for a planning office, it reminded me of the type of under-bidding by consultants that came back to haunt budgets with repeated cost escalations. It is a blank check! The supes need to address this and I'm pleased it has been delayed for a week so it can be.