SDG&E MAINTENANCE YARD COULD MOVE TO CARLSBAD MALL

An agreement is near on plans to move San Diego Gas & Electric Company’s regional maintenance yard from the old Encina power plant property to a spot outside The Shoppes at Carlsbad mall on El Camino Real.

The search for a new maintenance yard has been underway since the city, NRG and SDG&E signed a deal eight years ago to demolish the coastal plant and its 400-foot-tall smokestack, but a few hurdles remain. The shopping mall location, along the south side of Buena Vista Creek and state Route 78, is a relatively recent addition to the more than dozen sites considered so far.

“This is not an easy project,” said City Attorney Celia Brewer, who helped forge the 2014 agreement between property owner SDG&E, power plant owner NRG, and the city, in a Carlsbad City Council discussion of the project last week.

An important element at the time was the closure of the San Onofre Nuclear Generating Station, and worries that the loss of the large power source would destabilize the grid. Because of that, regulating agencies approved a new, more efficient “peaker plant” to replace the old Encina plant. NRG built the new plant, now in service, on the eastern edge of the Encina property.

Carlsbad opposed the new plant, saying that the coastal site would be better for other uses such as tourism or recreation.

The agreement reached in 2014 yielded “a host of benefits to the city” including removal of the old power plant and the maintenance yard, Brewer said.

The maintenance yard on Cannon Road just east of Cannon Park has been there since the Encina power plant was built in the 1950s. The yard operates around the clock, seven days a week, to provide emergency service for miles of electric and gas lines serving more than 250,000 customers from Camp Pendleton to Del Mar and inland to Fallbrook, Vista and Rancho Santa Fe.

A 16-acre site known as Lot 11, also on Cannon Road and near the strawberry fields less than a mile east of the existing yard, was first considered the most likely new location. However, SDG&E now says additional studies have shown Lot 11 is infeasible because of geotech

nical issues, and the utility company needs a different place.

Last year, Carlsbad proposed the shopping mall site and brought the mall owner, Brookfield Properties, into the negotiations.

Brookfield owns the mall buildings and the land they are on. The city owns about 45 acres, or half of the 90-acre mall, and the city property is deed-restricted to be used only for parking.

The shopping mall land proposed for the maintenance yard, probably 10 to 12 acres, is on the northwestern side of the parking lot. While entirely owned by Carlsbad, a piece of the site is located within neighboring Oceanside.

Moving the maintenance yard to the mall could benefit everyone including Brookfield, said Ted Lohman, the company’s vice president of development.

For one thing, the deal could open the door for residential development of the deed-restricted parking property around the buildings, Lohman said. The city has included residential development at the mall in its long-term plans for years.

“Housing would have a synergistic relationship with the (shopping) center,” Lohman said, and it would help address the “tremendous housing shortage” facing the region.

Shopping malls everywhere have been suffering financially because of the long, steady trend toward online retail and, more recently, because of the restrictions of the pandemic. Many brick-and-morter retail establishments are looking for new ways to stay viable.

“A relocation of SDG&E could be a catalyst to drive more extensive redevelopment,” Lohman said, but like other speakers, he emphasized the need to take quick action.

“Time is not our friend,” he said. “We need some finality on this now.”

An agreement to move the yard would give Carlsbad ownership of three coastal SDG&E properties — the 16-acre maintenance yard, the 1.7-acre Cannon Park now leased by the city at the corner of Cannon and Carlsbad Boulevard, and about 5 acres of vacant property on the northern shore of Agua Hedionda Lagoon.

Also, once a location is chosen, NRG is committed to contributing $22.5 million to help pay for the relocation of the maintenance yard. If no location is found,

SDG&E forfeits the money, and NRG would pay $10 million to Carlsbad instead.

Another factor in the deal is that SDG&E has outgrown the existing yard. The city approved a fiveyear conditional use permit in 2012 for SDG&E to install a temporary building for additional space there. Since then, the city has issued one five-year extension. However, the city discourages the use of temporary buildings, and another extension would be inconsistent with the municipal code.

“We remain committed to finding an option to relocate the service center,” SDG&E Public Affairs Manager Joe Gabaldon said at the council meeting.

“The service center is the hub of critical work,” Gabaldon said, and the site must be free of flooding and other hazards so that the workers and equipment there can respond to any emergency.

Soil and hydrology studies are underway at the shopping mall site, and the results should be available in a few weeks. Cost analyses also are being done, including the expense of any environmental mitigation that may be required.

Ultimately, any decision on the move and a new location will be subject to approval by the state Public Utilities Commission, Gabaldon said.

Former Carlsbad Councilmember Mark Packard, who as an elected official helped reach the threeparty settlement in 2014, urged everyone to settle on a spot.

“It’s not in anybody’s best interest to delay this any longer,” Packard said.

Demolition of the old plant is nearly finished and is on track to be completed this summer, said John Chillemi, former president of the NRG West Region and now an advisor to the company.

NRG is looking for a partner to help develop the power plant site in a way to meet the city’s zoning and guidelines, Chillemi said.

No details have been released about what might be built. Carlsbad’s General Plan allows “visitor-serving commercial and open space uses” on the site that would improve public access to the coast, according to the city website.

“We look forward to working with the community in shaping this plan,” Chillemi said. “If the service center is relocated, (that) would be the best path forward and compatible with the agreement signed in 2014.”