San Jose considers implementation agreement with PG and E to boost electricity supply

San Jose city leaders are poised to take a significant step towards enhancing the city’s electric utility landscape by exploring a new implementation agreement with Pacific Gas and Electric (PG&E). During a special city council meeting on March 21, 2025, officials discussed the potential benefits of formalizing a partnership with PG&E, emphasizing the need for a structured agreement to ensure reliable electricity supply and support economic growth.

The proposed agreement aims to create clear obligations for PG&E, fostering trust and collaboration between the city and the utility provider. Council members highlighted the urgency of securing additional electricity to meet the growing demands of San Jose, particularly as the city positions itself to attract large-scale customers in sectors like manufacturing and data centers, especially those related to artificial intelligence.

Kip, a city representative, underscored the economic implications of the agreement, noting that successful negotiations could lead to significant fiscal benefits for the city. These funds would be unrestricted, allowing for investments in essential services such as parks, libraries, and public safety. “Now is an opportunity to catch this next wave of investment,” Kip stated, stressing the importance of acting swiftly to capitalize on emerging business opportunities.

However, the city is also preparing for the possibility that the agreement may not materialize as planned. In such a scenario, officials have outlined a backup plan to develop a municipal electric utility, ensuring that San Jose can maintain control over its electricity supply and continue to support local economic development.

The council is expected to vote on three key recommendations: accepting the results of the exploration study, authorizing the city manager to negotiate the implementation agreement with PG&E, and allowing for the evaluation of a municipal electric utility if necessary. As discussions continue, city leaders remain optimistic about the potential for a successful partnership that could set a precedent for other municipalities in California.