Dean: San Jose residents and business will lose in city’s power play

Just this August, with virtually no public notice, analysis or stakeholder engagement, San Jose city leaders announced to the world that they wanted to get into the business of delivering electricity.

The city’s desire to form an electric utility company should be a cause for concern for San Jose residents and businesses, particularly when they realize San Jose leaders could be asking all city residents to foot the bill for this risky and expensive endeavor when the new utility would serve only limited areas.

To be clear, the city has admitted it has no idea how much forming a new public utility would cost. But it has stated that benefits of the new utility, if there are any, would be available only to “retail” customers in “select areas of the city.”

In other words, current San Jose residents will be asked to foot the bill for building a grid that they may never use.

The city’s promise of lower rates, reliable service and cleaner power may sound great. But these pie-in-the-sky promises begin to lose their luster when San Jose residents realize the city’s current public power buyer, San Jose Clean Energy, promised much but delivered little; they offer nearly the same rates as PG&E. Plus, San Jose has no idea how to operate an electric grid, which experts call the biggest and most complicated machine ever built.

It is bad enough San Jose leaders attempted to create a new electric utility behind the curtain. But this proposal is much worse when you realize it assumes that developers would foot the bill for construction of millions of dollars of electric infrastructure and then deed those facilities over to the city’s new utility. It is ridiculously naive for San Jose leadership to believe a brand-new electric grid would simply be gifted over to them.  Worse, those commitments could have major financial implications for San Jose residents and businesses whose taxes fund city government.

It is not as though the city doesn’t have other, more pressing priorities. Just last month, the San Jose City Council did the right thing and voted to approve a labor deal, narrowly averting a citywide strike. City leaders have said they want to address skyrocketing property crimes, severe housing shortage and the flood of homelessness. Instead, they will commit money and staff resources to launch a new electric utility for which there is no pressing public need or interest.  With hundreds of millions of dollars of city financing on the line and many urgent priorities competing for each city dollar, it’s imperative that our elected leaders refuse any more half-baked plans and demand to see the real costs of San Jose power before even entertaining a vote.

As the workers who keep San Jose residents in power, we urge the city council to delay any action until a full analysis on financial impact has been completed. We think San Jose electric customers deserve better.

Robert Dean is the business manager of International Brotherhood of Electrical Workers Local Union 1245, which represents over 27,000 members, including utility workers in San Jose.