Independent study: city takeover of gas and electric service too risky
POINT LOMA NAZARENE UNIVERSITY (KUSI) – An independent study done by the Point Loma Nazarene University’s Fermanian Business & Economic Institute is warning against a government takeover of San Diego’s power grid. This process is also known as municipalization.
“Municipalization will not make power bills lower for San Diego residents or small businesses, it will not make our power any greener or produce substantive environmental benefits,” said Brigette Browning, Executive VP of San Diego and Imperial Counties Labor Council. “As labor leaders we are devoted to making a more green and environmentally just economy. Unfortunately, as this study makes clear, municipalization would spend billions of dollars without making progress on those critical goals.”
Mayor Todd Gloria has been an advocate for making changes to achieve the city’s climate action and environmental equity goals. However, the Chief Economist for this study, Lynn Reaser, found that the payoffs would be very low for reaching those goals.
“It does not include the cost or process of procuring energy. That responsibility already falls on the city as it has recently formed the new San Diego community power,” Reaser said. “What it entails is the accusation of all the distribution and transmission assets that bring power to San Diego homes and businesses.”
Reaser said the startup costs before the city could begin operations would near $9 billion. The study found it would also jeopardize the jobs of utility workers by lowering wages and compromising retirement benefits.
“There’s a lot of things,” said Keith Maddox, Executive Secretary Treasurer at San Diego and Imperial Counties Labor Council. “Wages, their healthcare would be different, and they would definitely lose their retirement benefits.”
Jerry Sanders, President and CEO of the San Diego Regional Chamber of Commerce said from his experience navigating the city through tough financial times as former mayor, that this is not the way to continue efforts to help the economy bounce back from the pandemic.
“Given the severe economic burden the city is under because of the pandemic, it would not be sensible to make this change that carries with it so many inherent consequences,” Sanders said. “Disastrous distraction like municipalization is the wrong way to find stability. The city’s efforts and funds should be focused on where they matter most: on our economic recovery.”
KUSI has reached out to Mayor Todd Gloria to respond to accusations found in this study, but have not heard back.