By Julie BUTCHER

On Tuesday night, the Glendale City Council reviewed potential plans for a “virtual power plant” (VPP) – the installation of solar panels and battery storage to connect 2,200 single-family homes and 70 multi-family properties; however, ultimately council sent the city’s negotiators back to the bargaining table, dissatisfied with the terms worked out to date.

The city has been negotiating for the past two years with Sunrun, Inc., the nation’s largest residential solar company, for a 25-year contract to add 25.25 MW to the city’s energy supply. Customers who opt to participate would receive battery backup during outages and would be eligible for credits on their utility bills of $15 – $35 per month, depending on the size of their battery.

Chie Valdez, an integrated resource planning administrator at Glendale Water and Power, detailed the benefits of the program, which she noted would be the largest project of its kind in the country: it delivers 100% renewable energy, is local and flexible; the VPP would enable the city to reduce its reliance on repowering the Grayson Power Plant, thus reducing CO₂ and also improving the city’s renewable energy portfolio by 3%.

Through a series of power purchase agreements and master interconnection agreements, Sunrun would be responsible for all aspects of the installation, permitting, maintenance and coordination of the residential solar panels rolling out over the next four years. At an estimated annual cost of $5.12 million, this solar energy would cost $130 per MWh. Battery capacity would run $137.50 per kW-year, adding another $3.47 million to the bill. The city’s contribution would be capped at $12.7 million with Sunrun funding costs above that cap, and the company would indemnify the city from liability, staff reported.

Highlighting the potential downsides of the project, Valdez noted that the relatively expensive resource would necessitate a rate increase of 7.7%. The proposed deal allows for only six months for the termination of the agreement, and the long-term obligation comes with regulatory, cost and technology changes and contractual risks.

Monica Campagna called into the meeting, representing the Glendale Environmental Coalition, expressing strong support for the VPP moving forward.

“This would be a huge benefit to the community, especially the resiliency factor. We’re talking about homeowners who haven’t yet bought solar – might not be thinking about purchasing their own system – but this would be perfect for a resident who would just like to have solar and would love to have a battery but doesn’t want to put out the money upfront to buy a system of their own. This would provide added resilience to them and to the grid in a very forward-thinking way,” Campagna said. “Hundreds of people are ready to go. It would be a great way to get a battery for your home and to be part of the solution,”

Councilmember Dan Brotman observed that “this is a very tightly negotiated deal – I’ve been critical of the amount of time this has taken, but it’s very good pricing for Glendale. At 13 cents/kWh, it’s solar energy that costs substantially less than larger installations in the City of Los Angeles. I think the benefits of this have gotten short shrift in this discussion. A system like this distributed around the city will make our distribution grid more reliable.”

“It’s a resource we can get up and running fairly quickly over the next four years, starting now. Anything we do at Grayson won’t come online until the end of 2025, more likely 2026. If there’s an outage – because of a squirrel or a mylar balloon or for whatever reason – a full battery can run your house for a day and a half. If it’s 20% full, you can operate your appliances – maybe not your air conditioner, but your fridge and medical equipment – for seven hours. The notion that rates would go ‘up and up and up,’ as a caller suggested, costs attributed to this are 1.5% for five years – there’s no additional rate impact beyond the five years, so the idea that rates would go up and up and up is just not correct,” Brotman added.

“I don’t want to be the first,” Councilmember Vrej Agajanian railed against the plan. “The technology is continuously evolving. I can’t imagine having a contract for 25 years. It’s good, clean energy … but at what cost? Two years later, the costs will be ridiculous and people will ask, who approved this? It bothers me. I don’t want to be the first city to do this.”

Councilmember Ara Najarian shared his views.

“I really want this to work. It’s a brilliant concept. I run into difficulties locking ourselves into a 25-year commitment,” he said then also listed specific questions he deems outstanding, including issues of installation and liability insurance, and the specter of a lien on personal property.

“I don’t want to say ‘Throw this in the dumpster;’ perhaps Sunrun had the wrong impression. Let them know the council isn’t so willing. Maybe we take a smaller bite at this,” he suggested.

Mayor Paula Devine reminded the council of their “fiduciary responsibilities.”

“This is risky and costly. Solar is not cheap, and it is not free – it is very expensive,” she said. “What happens if the roof is damaged? That happened to a friend of mine. Will they be hiring union labor to install these? Electricity from Scholl Canyon is going to cost $35 – $40 per MWh and Sunrun wants $254? And that’s for 25 years, by the way.”

Devine seconded a motion by Councilmember Agajanian to send staff back to negotiate new terms on the myriad issues raised by councilmembers, which passed on a vote of 3-2, with Councilmembers Brotman and Ardy Kassakhian voting no.

In a separate discussion about electrical rates, the council heard a lengthy report on the costs of delivering electricity and voted to phase in the proposed rate increase of 17% over the next five years.