As a San Diego resident, you may have heard the term “SDGE franchise agreement” being thrown around. But what does it actually mean? And why is it important for both residents and the energy company?

Firstly, let’s define what a franchise agreement is. It is a contract between a local government and a utility company that grants the company the right to use public land and infrastructure to provide services to the community. In the case of San Diego Gas & Electric (SDGE), the franchise agreement allows them to provide electricity and natural gas services to the city’s residents and businesses.

The current franchise agreement between SDGE and the City of San Diego was signed in 1970 and is set to expire in January 2021. This means that both parties are currently negotiating a new agreement that will determine the terms of SDGE’s service to the community for the next several decades.

So why is this important? Well, the franchise agreement affects many aspects of SDGE’s operations and ultimately, the cost and reliability of energy services for residents.

One of the main issues being negotiated is the amount of compensation SDGE will pay to the City of San Diego for the use of public land and infrastructure. This compensation is known as a franchise fee and is typically a percentage of the company’s revenue. The higher the franchise fee, the more money the city receives to invest in public services and infrastructure. However, a high franchise fee also means that SDGE may pass on the cost to customers through higher energy bills.

Another issue being negotiated is the level of renewable energy that SDGE will provide. The city has set a goal to achieve 100% renewable energy by 2035, and the franchise agreement will play a big role in achieving this goal. Negotiations will focus on SDGE’s commitment to renewable energy and the timeline for achieving this goal.

Finally, the franchise agreement will also address the level of customer service and reliability that SDGE provides. The agreement will determine the standards for outage response times, equipment maintenance, and other aspects of service that affect the customer experience.

In conclusion, the SDGE franchise agreement may seem like a technical and bureaucratic issue but it affects the cost and reliability of energy services for all San Diego residents. Negotiations between the City and SDGE are ongoing, and it’s important for residents to stay informed about the outcome of these negotiations. Ultimately, the franchise agreement will determine the future of energy services in San Diego and the impact they have on the environment and our wallets.