Most every resident in Santa Clara enjoys the amazing benefits of ridiculously low electric rates. In fact, even with the recent surge of rate increases, Silicon Valley Power (SVP) is cheap and sits as a thistle in the butt of PG&E a few blocks away.
This is not the doing of the current staff that operates SVP. This city-owned company was created over 100 years ago and has served the City residents, businesses and industries with satisfaction and success.
Even with recent residential rate increases, which are a blip on the SVP balance sheet, the company remains competitive and profitable.
Profit is not the exact word because SVP is a not-for-profit entity. Net benefit to the City’s bottom line is another way to put it.
However, if you are a resident of long-standing or a new arrival, SVP remains a mystery to nearly everyone in town.
The mystery continues as the city council wrestles with ballooning budget bungles and deferred debt, as tax revenues are not growing at the rate of inflation. This has caused chaos in the council as they calculate creative ways to create cash.
There are some very bright people that serve the City of Santa Clara. Mayor Gillmor is one — or can be when she’s not preoccupied with personal ambition and grievance. The millions Mayor Gillmor spent on litigation would normally have filled a large part of this hole.
That history is not going to change. However, there has to be a way to make use of SVP revenues to serve the City as well as residents.
Certainly, there are legal ways for the City to find ways to charge SVP for a variety of necessary services such as leases, space rent, equipment usage, consulting fees, management expenses, to name a few.
If SVP operates with any deficit, it could, and should, pass rate increases along to industry, which is the major user of its product. With a meager increase passed along to the City’s industrial base, you are talking millions. This would still retain Santa Clara’s competitive edge in the power market.
This is not a new idea. It has been kicked around for generations. There are about 20 reasons that are regularly repeated as to why it can’t be done, and council members have probably heard every one.
My experience is that times change, issues change, requirements change and now may be time for a change.
Let’s hope we don’t hear that age-old excuse, “Oh, you can’t do that because…”
Turn the lights on and find a way to make adjustments.
Previous Milestones:
Milestones – Double Dealing! – Opinion
Milestones – The Power Switch! – Opinion
View Comments (3)
Could you list the reasons? I'm curious why we don't have at least one higher tier for data centers. I believe SVP says its regular commercial rate is 40% less than PG&E's. Data centers don't bring much in the way of human activity and related sales tax. They don't cause much wear and tear on streets with commuters either I suppose.
It is the huge industrial customers of SVP who make it possible for SVP to be as big and have the economy of scale that it does. For all of us residential customers this means lower rates and more reliable service and faster restoration of downed lines.
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We have a bigger percentage discount as residential customers than the big industrial customers get when comparing SVP rates to PG&E rates. They are already subsidizing our cheap residential rates.
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And it is the huge volume of purchases by industrial customers that sends millions of dollars per year from SVP to our city's general fund. For the 2023 fiscal year SVP transferred $3,706,812 to the city.
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I am glad that SVP is run by great professionals who make it a huge asset to all the people of Santa Clara and especially us residential customers. Miles should read SVP's annual reports and listen to Manuel Pineda's detailed reports at city council meetings before he presumes to offer his opinion on how to change what has been a fantastic winning formula.
Great idea! But I would not support one extra penny going to the general fund until other cuts are made. Not sure where the cuts should start, but I would scrutinize the Fire and Police department budgets very closely. .