Transition PGW to Renewable Energy
PGW
Issue: PGW must transition from fossil fuels to renewable energy sources.
Philadelphia Gas Works (PGW), the largest municipal utility in the country, provides reliable, affordable fuel for heating and cooking to its residential customers and energy for its commercial and industrial customers. In response to climate disruption, PGW will need to replace fracked gas as its primary product while continuing to assure the affordability and supply of sustainable alternative sources of renewable energy.
Need: PGW needs to transition to a new business model.
PGW needs to plan for adaptation of its current capacities and creation of replacement infrastructure to reconfigure its physical assets and labor force – tasks that will require substantial new capital investment. As examples: gas generated from landfills and/or biodigesters can replace fracked gas for some parts of the PGW delivery system; hydrogen electrolyzed from water can be infused into the product stream, simultaneously displacing gas and increasing BTU delivery; and geothermal resources can be developed. Furthermore, consumers will need to modify or replace existing equipment in order to use the new systems.
Solution: Create a Philadelphia Public Bank to finance PGW and consumer acquisitions.
Backed by a rate structure that currently returns approximately $18 million annually to the City, PGW could finance its capital needs through a Philadelphia Public Bank, including its extensive future requirements for expansion and replacement of assets.
Furthermore, a Philadelphia Public Bank could support programs that provide consumer financing for home appliances and home improvements related to the new business model directly and/or through partner community banks. An ESCO (Energy Service Company) approach can be applied to such financing whereby the cost savings/replacement derived from the investment provides the basis for loan repayment.
