SSJID's Aggressive Energy Play.

The South San Joaqin Irrigation District is shopping a proposal to outside investors to build a solar farm in the district. While I haven't read the fine print, on the surface the plan seems interesting and it appears to be the kind of aggressive, creative thinking that California needs more of.

Basically, the SSJID needs power to run its water treatment plant. Rather than construct the generation facility itself, it is seeking to contract with private sector interests to build it using their own capital. In return, the private sector builder/operator will get federal tax breaks (that the SSJID is not eligible for because it is a non-profit) and a guaranteed contract with the SSJID to purchase all of the power at a discount (the private sector builder/operator would still make money on the sales, however).

Again, the devil is in the details, but the deal appears to be the kind of innovative public/private partnership that will facilitate more renewable energy generation in California.

Ironically, the SSJID is also in the midst of a nasty eminent domain fight with PG&E. The District has offered $80 million for PG&E's distribution infrastructure in the area, but PG&E is not biting. SSJID claims it can offer customers a 15% dsitrict if the deal goes through.

Admittedly, the eminent domain fight is the polar opposite of the kind of market-based solution that this blog loves, but you have appreciate the aggressive play by SSJID. The District is pushing the envelope on all fronts to squeeze fat, maximize efficiency and provide cost-efficient energy solutions to consumers.

No doubt there are going to be lots of supporters and detractors for both of these proposed deals, but these are the kinds of public policy discussions California needs to have if it is going to dig itself out of the current energy mess.

District seeks solar investors [Sun Post]