HomeMy WebLinkAbout2020-05-12; City Council; ; Clean Energy Alliance UpdateClean Energy Alliance implementation
The alliance is meeting its milestones for the implementation of its community choice
aggregation, or CCA, program and is on track to begin serving customers in May 2021. The
Clean Energy Alliance achieved a significant milestone March 16 with the California Public
Utilities Commission's certification of the alliance's Community Choice Energy Implementation
Plan and Statement of Intent (Exhibit 4).
The alliance has submitted all regulatory compliance filings required to date, including the most
recent filing of the Year-Ahead Resource Adequacy Forecast. That forecast informs the
California Energy Commission and the state Public Utility Commission of the alliance's projected
energy load for 2021. The two state commissions use the forecast to determine how much
electricity-generating capacity the alliance will need to procure. Clean Energy Alliance staff and
consultants have been working with SDG&E to ensure the forecasts align with SDG&E's
assumptions related to how much of the energy that is now being provided by SDG&E will be
provided by the alliance. The Clean Energy Alliance has until May 15, 2020 to make any
revisions to the initial forecast.
The milestone is significant because, under Section 8.1.1 of the Clean Energy Alliance
agreement (Exhibit 2 - Attachment A), the first filing of the Year-Ahead Resource Adequacy
Forecast is the last point at which a member agency may unilaterally withdraw from the
alliance without having to give a one-year notice and without potentially incurring further
financial obligations other than each city's already committed initial share of the alliance's
startup costs of $150,000.
CEA Initial Draft Pro Forma, FY 2020-21 Budget and FinancingStrategy
At its April 16 meeting (Exhibit 6), the Clean Energy Alliance Board reviewed the initial draft of
the alliance's CCA financial pro forma2 (Exhibit 5). Assumptions that served as the basis for the
initial draft included:
•A default energy product with at least 50% of the energy coming from renewable power
sources,3 increasingto 100% by 2035.
•No category 3 renewable energy credits4
2 Pro forma refers to a method of calculating financial results using certain projections or presumptions.3 The alliance will establish the energy product options available to its customers. Each member of the alliance can
select its default energy product, with at least 50% of the power coming from renewable sources. Individual
customers can accept their city's default product or choose from other options. The larger the share of renewable
energy, the higher the costs of the energy. 4 Renewable energy credits are measures of renewable energy production that show electricity has been
generated from an eligible renewable energy resource and delivered to the electric grid. The three categories are:
o Category 1: Renewable energy that is delivered from eligible renewable resources within California.
o Category 2: Renewable energy that is generated outside of California-but within the Western Electricity
Coordinating Council -and coupled with an equivalent volume of energy from an alternative source,
typically hydroelectric or natural gas.
o Category 3: Renewable energy generated within the Western Electricity Coordinating Council but are not
attached to any physical energy. This category of REC allows businesses, organizations, and institutions to
claim the environmental benefits of renewable energy generation to satisfy their own sustainability goals
or requirements.
May 12, 2020 Item #8 Page 2 of 137
Clean Energy Alliance's remaining start-up costs, and which could enable the alliance to repay
its member agencies' $150,000 advances sooner.
The updated proforma with the requested scenarios will be brought before the board at its
May 7 meeting. The direction provided by the board related to the policy decisions discussed
above will be used to develop the fy 2020-21 budget to be adopted by the board at its June 18
meeting.
Advising the city's representatives to the Clean Energy Alliance Board
As members of the alliance's Joint Powers Authority Boar.d of Directors, the city's CEA Board
representatives have a fiduciary responsibility to serve that independent public agency. As
such, the City Council cannot give direction to its alliance board representatives pertaining to
taking specific actions or casting specific votes on matters before the Clean Energy Alliance
Board. The City Council may, however, offer advice to its board representatives on such
matters, if it chooses to do so.
Furthermore, the CEA Joint Powers Agreement identifies several specific actions for which the
City Council acts as the deciding body, including:
• Assuming any responsibility for the debts, liabilities, and obligations of the alliance.
(Section 3.5)
• Selection of a city's default power supply product. (Section 6.5)
• Directing funds into programs, projects, or other ratepayer benefits, pursuant to CEA
Board policies concerning the expenditure of discretionary revenues. (Section 7.6)
• Withdrawal of membership in the alliance. (Sections 8.1.1, 8.1.2 and 8.1.3)
Fiscal Analysis
No city funding is being requested and actions taken by the Clean Energy Alliance Board of
Directors impose no financial commitments or associated fiscal impacts on the City of Carlsbad.
Next Steps
The Clean Energy Alliance is proceeding with the implementation of its community choice
aggregation program and is on track to begin serving customers in May 2021.
Environmental Evaluation (CEQA)
Pursuant to Public Resources Code Section 21065, this action of receiving an update on the
Clean Energy Alliance and considering providing advice to the city's Clean Energy Alliance Board
representatives does not constitute a "project" within the meaning of the California
Environmental Quality Act in that it has no potential to cause either a direct physical change in
the environment, or a reasonably foreseeable indirect physical change in the environment, and
therefore does not require environmental review.
Public Notification
This item was noticed in accordance with the Ralph M. Brown Act and was available for public
viewing and review at least 72 hours prior to scheduled meeting date.
May 12, 2020 Item #8 Page 4 of 137
Exhibits
1. April 17 request from Mayor Hall to place an item on the May 12 City Council agenda
2. City Council Resolution No. 2019-197
3. City Council Resolution No. 2019-229
4. Clean Energy Alliance CCA Implementation Plan and Statement of Intent
5. Clean Energy Alliance DRAFT Pro Forma Projections
6. Agenda Packet for April 16 Clean Energy Alliance Board of Directors Meeting
7. Agenda Packet for May 7 Clean Energy Alliance Board of Directors Meeting
May 12, 2020 Item #8 Page 5 of 137
From: Matthew Hall <Matt.Hall@carlsbadca.gov>
Date: April 17, 2020 at 8:28:41 AM PDT
Exhibit 1
To: Scott Chadwick <scott.chadwick@carlsbadca.gov>, Celia Brewer <Celia.Brewer@carlsbadca.gov>,
Sheila Cobian <Sheila.Cobian@carlsbadca.gov>
Subject: CEA
As mayor and following the municipal code I would like to have an update, discussion, and the ability to
give direction to representatives of our CEA members placed on the May 12th meeting agenda .
Sent from my Verizon, Samsung Galaxy smartphone
May 12, 2020 Item #8 Page 6 of 137
Exhibit 2
RESOLUTION NO. 2019-197
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD
APPROVING AND AUTHORIZING THE EXECUTION OF THE JOINT
EXERCISE OF POWERS AGREEMENT CREATING THE CLEAN ENERGY
ALLIANCE, A COMMUNITY CHOICE AGGREGATION JOINT POWERS
AUTHORITY
WHEREAS, Section 6500 et seq. of the Government Code authorizes the joint exercise by
two or more public agencies of any power common to them as a Joint Powers Authority ("JPA");
and
WHEREAS, Public Utilities Code Section 366.2(c)(12) specifically authorizes two or more
cities, counties or a combination of two or more cities and counties to conduct a community
choice aggregation (CCA) program through the creation of a JPA; and
WHEREAS, the creation of a CCA JPA would allow its members to share resources and
jointly provide and achieve the environmental and economic benefits of a CCA program on a
regional basis; and
WHEREAS, the City of Carlsbad desires to enter into a Joint Exercise of Powers
Agreement to establish the Clean Energy Alliance, a CCA JPA along with the Cities of Del Mar,
Santee, Solana Beach and the County of San Diego, and any additional members approved by
the JPA Board in the future.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California as
follows:
1. The Joint Exercise of Powers Agreement Creating the Clean Energy Alliance, a
Community Choice Aggregation Joint Powers Authority (Clean Energy Alliance)
("Agreement") is hereby approved, and the City Manager is authorized to execute the
Agreement in substantially the form attached hereto as Attachment A, together with
minor technical or clerical corrections, if any.
2. Staff is authorized and directed to take such further actions as may be necessary and
appropriate to implement the intent and purposes of this Resolution.
3. This Resolution and the creation of the Clean Energy Alliance is exempt from the
requirements of the California Environmental Quality Act (CEQA), as it involves
organizational and administrative activities of government that will not result in direct
or indirect physical changes on the environment, and therefore is not considered a
"project." (14 Cal. Code Regs. § 15378(b)(5).)
Oct. 8, 2019 Item #5 Page 8 of 38 May 12, 2020 Item #8 Page 7 of 137
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of
Carlsbad on the 8th day of October 2019, by the following vote, to wit:
AYES: Hall, Blackburn, Bhat-Patel, Schumacher, Hamilton.
NAYS: None.
ABSENT: None.
(SEAL)
Oct. 8, 2019 Item #5 Page 9 of 38 May 12, 2020 Item #8 Page 8 of 137
Attachment A
Clean Energy Alliance Joint Powers Agreement
Effective: November 4, 2019
May 12, 2020 Item #8 Page 9 of 137
CLEAN ENERGY ALLIANCE JOINT POWERS AGREEMENT
This Joint Powers Agreement (the "Agreement"), effective as of f'(_ou, l/,;}Ol'f , is made by the
Founding Members of the Clean Energy Alliance and entered into pursuant to the provisions of
Title 1, Division 7, Chapter 5, Article 1 (Section 6500 et seq.) of the California Government
Code relating to the joint exercise of powers among the public agencies set forth in Exhibit B.
RECITALS
1. The Parties are public agencies sharing various powers under California law, including
but not limited to the power to purchase, supply, and aggregate electricity for themselves
and their customers.
2. SB 350, adopted in 2015, mandates a reduction in greenhouse gas emissions to 40 percent
below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050. In 2018, the
State Legislature adopted SB 100, which directs the Renewable Portfolio Standard to be
increased to 60% renewable by 2030 and establishes a policy for eligible renewable
energy resources and zero-carbon resources to supply 100 percent of electricity retail
sales to California end-use customers by 2045.
3. The purposes for the Founding Members (as such term is defined in Exhibit A) entering
into this Agreement include procuring/developing electrical energy for customers in
participating jurisdictions, addressing climate change by reducing energy-related
greenhouse gas emissions, promoting electrical rate price stability and cost savings, and
fostering consumer choice and local economic benefits such as job creation, local energy
programs and local power development. It is the intent of this Agreement to promote the
development and use of a wide range of renewable energy sources and energy efficiency
programs, including but not limited to state, regional, and local solar and wind energy
production and energy storage.
4. The Parties to this Agreement desire to establish a separate public agency, known as the
Clean Energy Alliance ("Authority"), under the provisions of the Joint Exercise of
Powers Act of the State of California (Government Code Section 6500 et seq.) ("Act") in
order to collectively study, promote, develop, conduct, operate, and manage energy
programs.
5. The Founding Members have each adopted an ordinance electing to implement through
the Authority a Community Choice Aggregation program pursuant to California Public
Utilities Code Section 366.2 ("CCA Program"). The first priority of the Authority will be
the consideration of those actions necessary to implement the CCA Program on behalf of
participating jurisdictions.
6. By establishing the Authority, the Parties seek to:
(a) Provide electricity service to residents and businesses located within the
jurisdictional boundaries of the public agencies that are members of the Authority in
a responsible, reliable, innovative, and efficient manner;
-2 -
May 12, 2020 Item #8 Page 10 of 137
(b) Provide electric generation rates to all ratepayers that are competitive with those
offered by the Investor Owned Utility, San Diego Gas & Electric (SDG&E), for
similar products with a target generation rate at least 2 percent below SDG&E's base
product generation rate;
( c) Offer a mix of energy products for standard commodity electric service that provide
a cleaner power portfolio than that offered by SDG&E for similar service and other
options, including a 90 percent and a 100 percent renewable content options in
which communities and customers may "opt-up" and voluntarily participate, with the
ultimate objective of achieving-and sustaining-the Climate Action Plan goals of
the Parties, at competitive rates;
(d) Develop an aggregate electric supply portfolio with overall lower greenhouse gas
(GHG) emissions than SDG&E, and one that supports near-term achievement of the
Parties' greenhouse gas reduction goals and renewable electricity goals;
( e) Promote an energy portfolio that incorporates energy efficiency and demand
response programs and pursues ambitious energy consumption reduction goals;
(f) Pursue the procurement oflocal generation of renewable power developed by or
within member jurisdictions with an emphasis on local jobs, where appropriate,
without limiting fair and open competition for projects or programs implemented by
the Authority;
(g) Provide a range of energy product and program options, available to all Parties and
customers, that best serve their needs, their local communities, and support regional
sustainability efforts;
(h) Support low-income households having access to special utility rates including
California Alternative Rates for Energy (CARE) and Family Electric Rate
Assistance (FERA) programs;
(i) Use discretionary program revenues to support the Authority's long-term financial
viability, enhance customer rate stability, and provide all Parties and their customers
with access to innovative energy programs, projects and services throughout the
jurisdiction of the Authority; and
(i) Create an administering Authority that seeks to maximize economic benefits and is
financially sustainable, well-managed and responsive to regional and local priorities.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual promises, covenants, and conditions
hereinafter set forth, it is agreed by and among the Parties as follows:
-3 -
May 12, 2020 Item #8 Page 11 of 137
1. DEFINITIONS AND EXHIBITS
1.1 Definitions. Capitalized terms used in this Agreement shall have the meanings
specified in Exhibit A, unless the context requires otherwise.
1.2 Documents Included. This Agreement consists of this document and the
following exhibits, all of which are hereby incorporated into this Agreement:
Exhibit A: Definitions
Exhibit B: List of Founding Members
2. FORMATION OF THE COMMUNITY CHOICE ENERGY AUTHORITY
2.1 Effective Date and Term. This Agreement shall become effective and the
Authority shall exist as a separate public agency on the date this Agreement is
executed by at least three Founding Members after the adoption of the ordinances
required by Public Utilities Code Section 366.2(c)(12). The Authority shall
provide notice to the Parties of the Effective Date. The Authority shall continue
to exist, and this Agreement shall be effective, until the Agreement is terminated
in accordance with Section 8.4 (Mutual Termination), subject to the rights of the
Parties to withdraw from the Authority under Section 8 .1.
2.2 Formation of the Authority. Under the Act, the Parties hereby create a separate
joint exercise of power agency named the Clean Energy Alliance. Pursuant to
Sections 6506 and 6507 of the Act, the Authority is a public agency separate from
the Parties. The jurisdiction of the Authority shall be all territory within the
geographic boundaries of the Parties; however, the Authority may, as authorized
under applicable law, undertake any action outside such geographic boundaries as
is necessary to the accomplishment of its purpose.
2.3 Purpose. The purpose of this Agreement is to establish the Authority, to provide
for its governance and administration, and to define the rights and obligations of
the Parties. This Agreement authorizes the Authority to provide opportunities by
which the Parties can work cooperatively to create economies of scale and
implement sustainable energy initiatives that reduce energy demand, increase
energy efficiency, and advance the use of clean, efficient, and renewable
resources in the region for the benefit of all the Parties and their constituents,
including, but not limited to, establishing and operating a CCA Program.
2.4 Addition of Parties. After the initial formation of the Authority and prior to
October 1, 2020, any incorporated municipality, county, or other public agency
authorized to be a community choice aggregator under Public Utilities Code
Section 331.1 and located within the service territory of SDG&E may become a
member of the Authority if it has completed a positive CCE Feasibility Study,
adopted a CCA ordinance pursuant to Public Utilities Code Section 366.2(c)(12),
approved and executed this Agreement, and paid or agrees to pay its share of the
Initial Costs pursuant to Section 7.3.2 of this Agreement. Notwithstanding the
foregoing, such public agency may be denied membership in the Authority if the
-4 -
May 12, 2020 Item #8 Page 12 of 137
Board determines within 60 days after the submittal of the CCE Feasibility Study
that the addition of the public agency would create an undue risk or financial
burden to the Authority or to the achievement of the CAP goals of the Parties.
On or after October 1, 2020, any incorporated municipality, county, or other
public agency authorized to be a community choice aggregator under Public
Utilities Code Section 3 31.1 and located within the service territory of SDG&E
may apply to and become a member of the Authority if all the following
conditions are met:
2.4.1 Adoption of a resolution by a two-thirds vote of the entire Board
authorizing membership in the Authority;
2.4.2 Adoption by the proposed member of a CCA ordinance as required by
Public Utilities Code Section 366.2(c)(12) and approval and execution of
this Agreement and other necessary program agreements by the proposed
member;
2.4.3 Payment of a membership fee, if any, as may be required by the Board to
cover Authority costs incurred in connection with adding the new party;
and
2.4.4 Satisfaction of any other conditions established by the Board.
2.5 Continuing Participation. The Parties acknowledge that membership in the
Authority may change by the addition, withdrawal and/or termination of Parties.
The Parties agree to participate with such other Parties as may later be added by
the Board, as described in Section 2.4 (Addition of Parties) of this Agreement.
The Parties also agree that the withdrawal or termination of a Party shall not
affect this Agreement or the remaining Parties' continuing obligations under this
Agreement.
3. POWERS
3.1 General Powers. The Authority shall have the powers common to the Parties
which are necessary or appropriate to the accomplishment of the purposes of this
Agreement, subject to the restrictions set forth in Section 3.4 (Limitation on
Powers) of this Agreement.
3.2 Specific Powers. Specific powers of the Authority shall include, but not be
limited to, each of the following powers, which may be exercised at the discretion
of the Board:
3.2.1 make and enter into contracts;
3.2.2 employ agents and employees, including but not limited to a Chief
Executive Officer;
-5 -
May 12, 2020 Item #8 Page 13 of 137
3 .2.3 acquire, own, contract, manage, maintain, and operate any buildings,
public works, improvements or other assets including but not limited to
public electric generation resources;
3.2.4 acquire property for the public purposes of the Authority by eminent
domain, or otherwise, except as limited under Section 6508 of the Act and
Sections 3.6 and 4.12.3 of this Agreement, and to hold or dispose of any
property; provided, however, the Authority shall not exercise the power of
eminent domain within the jurisdiction of a Party without its affirmative
vote under Section 4.12.2;
3.2.5 lease any property;
3.2.6 sue and be sued in its own name;
3.2.7 incur debts, liabilities, and obligations, including but not limited to loans
from private lending sources pursuant to its temporary borrowing powers
authorized by law pursuant to Government Code Section 53850 et seq. and
authority under the Act;
3.2.8 issue revenue bonds and other forms of indebtedness;
3.2.9 apply for, accept, and receive all licenses, permits, grants, loans or other
aids from any federal, state or local public agency;
3.2.10 form independent corporations or entities, if necessary, to carry out energy
supply and energy conservation programs;
3 .2.11 submit documentation and notices, register, and comply with applicable
orders, tariffs and agreements for the establishment and implementation of
the CCA Program and other energy programs;
3.2.12 adopt rules, regulations, policies, bylaws and procedures governing the
operation of the Authority;
3.2.13 make and enter into service agreements relating to the provision of
services necessary to plan, implement, operate and administer the CCA
Program and other energy programs, including the acquisition of electric
power supply and the provision of retail and regulatory support services;
3.2.14 receive revenues from sale of electricity and other energy-related
programs; and
3 .2.15 Partner or otherwise work cooperatively with other CCA' s on the
acquisition of electric resources, joint programs, advocacy and other
efforts in the interests of the Authority. ·
-6 -
May 12, 2020 Item #8 Page 14 of 137
3.3 Additional Powers to be Exercised. In addition to those powers common to
each of the Parties, the Authority shall have those powers that may be conferred
upon it by law and by subsequently enacted legislation.
3.4 Limitation on Powers. As required by Section 6509 of the Act, the powers of
the Authority are subject to the restrictions upon the manner of exercising power
possessed by the City of Solana Beach and any other restrictions on exercising the
powers of the Authority that may be adopted by the Board.
3.5 Obligations of the Authority. The debts, liabilities, and obligations of the
Authority shall not be the debts, liabilities, and obligations of any of the Parties
unless a Party agrees in writing to assume any of the debts, liabilities, and
obligations of the Authority with the approval of its Governing Body, in its sole
discretion. A Party that has not agreed in writing, as duly authorized by its
Governing Body, to assume an Authority debt, liability, or obligation shall not be
responsible in any way for such debt, liability, or obligation, regardless of any
action by the Board. Further, the debts, liabilities and obligations of the City of
Solana Beach related to or arising from its existing CCA program, commonly
known as the Solana Energy Alliance, shall not be the debts, liabilities or
obligations of the Authority or any of the Parties except the City of Solana Beach
unless the Board approves assuming specific contracts entered into by the City of
Solana Beach. Any such contracts assumed by the Authority shall be obligations
of the Authority only and not of any of the Parties. Notwithstanding Sections
4.12.1 and 9.8 of this Agreement, this Section 3.5 shall not be amended or its
liability limitations otherwise modified by an amendment to another part of this
Agreement unless such amendment is approved by the Governing Body of each
Party.
3.6 Compliance with Local Zoning and Building Laws. Notwithstanding any other
provisions of this Agreement or state law, any facilities, buildings, structures or
other projects (the "project") developed, constructed or installed or caused to be
developed, constructed or installed by the Authority within the territory of the
Authority (which consists of the territorial jurisdiction of the Parties) shall comply
with the General Plan, zoning, land use regulations, building laws and any
applicable local Coastal Plan of the local jurisdiction within which the project is
located.
3. 7 Compliance with the Political Reform Act and Government Code
Section 1090. The Authority and its officers and employees shall comply with
the Political Reform Act (Government Code Section 81000 et seq.) and
Government Code Section 1090 et seq. The Board shall adopt a Conflict of
Interest Code pursuant to Government Code Section 87300. The Board may
adopt additional conflict of interest regulations in the Operating Policies and
Procedures.
-7 -
May 12, 2020 Item #8 Page 15 of 137
4. GOVERNANCE
4.1 Board of Directors.
4.1.1 The Governing Body of the' Authority shall be a Board of Directors
("Board") consisting of one Director for each Party appointed in
accordance with Section 4.2 (Appointment and Removal of Directors) of
this Agreement.
4.1.2 Each Director must be a member of the Governing Body of the appointing
Party. Each Director shall serve at the pleasure of the Governing Body of
the Party that appointed such Director and may be removed as Director by
such Governing Body at any time. If at any time a vacancy occurs on the
Board, then a replacement shall be appointed to fill the position of the
previous Director within 45 days after the date that position becomes
vacant.
4.1.3 The Governing Body of each Party also shall appoint an alternate to serve
in the absence of the primary Director. The alternate also shall be a
member of the Governing Body of the appointing Party. The alternate
shall have all the rights and responsibilities of the primary Director when
serving in his/her absence.
4.1.4 Any change to the size and composition of the Board other than what is
described in this section shall require an amendment of this Agreement in
accordance with Section 4.12.
4.2 Appointment and Removal of Directors. The Directors shall be appointed and
may be removed as follows:
4.2.1 The Governing Body of each Party shall appoint and designate in writing
one regular Director, who shall be authorized to act for and on behalf of
the Party on matters within the powers of the Authority. The Governing
Body of each Party shall appoint and designate in writing one alternate
Director who may vote on matters when the regular Director is absent
from a Board meeting. The alternate Director may vote on matters in
committee, chair committees, and fully participate in discussion and
debate during meetings. All Directors and alternates shall be subject to the
Board's adopted Conflict of Interest Code.
4.2.2 A Director may be removed by the Board for cause in accordance
with procedures adopted by the Board. Cause shall be defined for the
purposes of this section as follows:
a. Unexcused absences from three consecutive Board meetings.
b. Unauthorized disclosure of confidential information or documents
from a closed session or the unauthorized disclosure of information
-8 -
May 12, 2020 Item #8 Page 16 of 137
or documents provided to the Director on a confidential basis and
whose public disclosure may be harmful to the interests of the
Authority.
c. Violation of any ethics policies or code of conduct adopted by the
Board.
Notwithstanding the foregoing, no Party shall be deprived of its right to seat a
Director on the Board and any such Party for which its Director and/or alternate
Director has been removed may appoint a replacement.
4.3 Director Compensation. The Board may adopt by resolution a policy relating to
the compensation or expense reimbursement of its Directors.
4.4 Terms of Office. Each Party shall determine the term of office for its regular and
alternate Director.
4.5 Purpose of Board. The general purpose of the Board is to:
4.5.l Provide structure for administrative and fiscal oversight;
4.5.2 Retain a Chief Executive Officer to oversee day-to-day operations of the
Authority;
4.5.3 Retain legal counsel;
4.5.4 Identify and pursue funding sources;
4.5.5 Set policy;
4.5.6 Optimize the utilization of available resources; and
4.5.7 Oversee all Committee activities.
4.6 Specific Responsibilities of the Board. The specific responsibilities of the
Board shall be as follows:
4.6.1 Formulate and adopt an annual budget prior to the commencement of the
fiscal year;
4.6.2 Develop and implement a financing and/or funding plan for ongoing
Authority operations and capital improvements, if applicable;
4.6.3 Retain necessary and sufficient staff and adopt personnel and
compensation policies, rules and regulations;
4.6.4 Adopt policies for procuring electric supply and operational needs such as
professional services, equipment and supplies;
-9 -
May 12, 2020 Item #8 Page 17 of 137
4.6.5 Develop and implement a Strategic Plan to guide the development,
procurement, and integration of renewable energy resources consistent
with the intent and priorities identified in this Agreement;
4.6.6 Establish standing and ad hoc committees as necessary;
4.6. 7 Set retail rates for power sold by the Authority and set charges for any
other category of retail service provided by the Authority;
4.6.8 Wind down and resolve all obligations of the Authority in the event the
Authority is terminated pursuant to Section 8.2;
4.6.9 Conduct and oversee Authority operational audits at intervals not to
exceed three years including review of customer access to Authority
programs and benefits, where applicable;
4.6.10 Arrange for an annual independent fiscal audit;
4.6.11 Adopt such bylaws, rules and regulations necessary or desirable for the
purposes set forth in this Agreement and consistent with this Agreement;
4.6.12 Exercise the Specific Powers identified in Sections 3.2 and 4.6 except as
those which the Board may elect to delegate to the Chief Executive
Officer; and
4.6.13 Discharge other duties as appropriate or necessary under this Agreement
or required by law.
4. 7 Startup Responsibilities. The Authority shall promptly act on the following
matters:
4. 7 .1 Oversee the preparation of, adopt, and update an implementation plan for
electrical load aggregation pursuant to Public Utilities Code Section
366.2(c)(3);
4. 7 .2 Prepare a statement of intent for electrical load aggregation pursuant to
Public Utilities Code Section 366.2( c )( 4 );
4. 7 .3 Obtain financing and/or funding as is necessary to support start up and
ongoing working capital for the CCA Program; and
4.7.4 Acquire and maintain insurance in accordance with Section 9.3.
4.8 Meetings and Special Meetings of the Board. The Board shall hold at least four
regular meetings per year, but the Board may provide for the holding of regular
meetings at more frequent intervals. The date, hour, and place of each regular
meeting shall be fixed annually by resolution of the Board. The location of
regular meetings may rotate for the convenience of the Parties, subject to Board
-10 -
May 12, 2020 Item #8 Page 18 of 137
approval and availability of appropriate meeting space. Regular meetings may be
adjourned to another meeting time. Special meetings of the Board may be called
in accordance with the provisions of Government Code Section 54956. Directors
may participate in meetings telephonically, with full voting rights, only to the
extent permitted by law. Board meeting agendas generally shall be set, in
consultation with the Board Chair, by the Chief Executive Officer appointed by
the Board pursuant to Section 5.5. The Board itself may add items to the agenda
upon majority vote pursuant to Section 4.11.1.
4.9 Brown Act Applicable. All meetings of the Board shall be conducted in
accordance with the provisions of the Ralph M. Brown Act (Government Code
Section 54950, et seq.).
4.10 Quorum. A simple majority of the Directors shall constitute a quorum. No
actions may be taken by the Board without a quorum of the Directors present.
4.11 Board Voting. Except for matters subject to Special Voting under Section 4.12,
Board action shall require the affirmative votes of a majority of the Directors on
the entire Board. The consequence of a tie vote shall be "no action" taken.
4.12 Special Voting.
4.12.1 The affirmative vote of two-thirds of the Directors of the entire Board
shall be required to take any action on the following:
(a) Issuing bonds or other forms of debt;
(b) Adding or removing Parties or removing Directors; and
( c) Amending or terminating this Agreement or adopting or amending
the bylaws of the Authority except as provided in Sections 3.5 and
4.12.3. At least 30 days advance written notice to the Parties shall
be provided for such actions. Such notice shall include a copy of
any proposed amendment to this Agreement or the bylaws of the
Authority. The Authority shall also provide prompt written notice
to all Parties of the action taken and attach the adopted
amendment, resolution or agreement.
4.12.2 An affirmative vote of three-fourths of the entire Board shall be required
to initiate any action for Eminent Domain and no eminent domain action
shall be approved within the jurisdiction of a Party without the affirmative
vote of such Party's Director.
4.12.3 An unanimous vote of the entire Board shall be required to amend the
following provisions in this Agreement:
(a) Section 2.3 (Purpose of Agreement)
-11 -
May 12, 2020 Item #8 Page 19 of 137
(b) Section 3.6 (Compliance with Local Zoning)
(c) Sections 4.11 and 4.12 (Voting Requirements)
(d) Section 4.12.2 (Eminent Domain)
(e) Section 6.5 (Power Supply Requirements)
(f) Section 6.6 (Solana Energy Alliance Transition)
5. INTERNAL ORGANIZATION
5.1 Elected and Appointed Officers. For each fiscal year, the Board shall elect a
Chair and Vice Chair from among the Directors and shall appoint a Secretary and
a Treasurer as provided in Government Code section 6505.5. No Director may
hold more than one such office at any time. Appointed officers shall not be
elected officers of the Board.
5.2 Chair and Vice Chair. For each fiscal year, the Board shall elect a Chair and
Vice Chair from among the Directors. The term of office of the Chair and Vice
Chair shall continue for one year, but there shall be no limit on the number of
terms held by either the Chair or Vice Chair. The Chair shall be the presiding
officer of all Board meetings, and the Vice Chair shall serve in the absence of the
Chair. The Chair shall perform duties as may be required by the Board. In the
absence of the Chair, the Vice-Chair shall perform all of the Chair's duties. The
office of the Chair or Vice Chair shall be declared vacant and a new selection
shall be made if: (a) the person serving dies, resigns, or the Party that the person
represents removes the person as its representative on the Board, or (b) the Party
that he or she represents withdraws from the Authority pursuant to the provisions
of this Agreement. Upon a vacancy, the position shall be filled at the next
regular meeting of the Board held after such vacancy occurs or as soon as
practicable thereafter.
5 .3 Secretary. The Board shall appoint a qualified person who is not on the Board to
serve as Secretary. The Secretary shall be responsible for keeping the minutes of
all meetings of the Board and all other office records of the Authority. If the
appointed Secretary is an employee of any Party, such Party shall be entitled to
reimbursement for any documented out of pocket costs it incurs in connection
with such employee's service as Secretary of the Authority, and full cost recovery
for any documented hours of service provided by such employee during such
Party's normal working hours.
5.4 Treasurer/Chief Financial Officer and Auditor. The Board of Directors shall
appoint a Treasurer who shall function as the combined offices of Treasurer and
Auditor and shall strictly comply with the statutes related to the duties and
responsibilities specified in Section 6505.5 of the Act. The Treasurer for the
Authority shall be the depository and have custody of all money of the Authority
from whatever source and shall draw all warrants and pay demands against the
-12 -
May 12, 2020 Item #8 Page 20 of 137
Authority as approved by the Board. The Treasurer shall cause an independent
audit(s) of the finances of the Authority to be made by a certified public
accountant, or public accountant, in compliance with Section 6505 of the Act.
The Treasurer shall report directly to the Board and shall comply with the
requirements of treasurers of incorporated municipalities. The Board may
transfer the responsibilities of Treasurer to any qualified person or entity as the
law allows at the time. The duties and obligations of the Treasurer are further
specified in Section 7. The Treasurer shall serve at the pleasure of the Board. If
the appointed Treasurer is an employee of any Party, such Party shall be entitled
to reimbursement for any documented out of pocket costs it incurs in connection
with such employee's service as Treasurer of the Authority, and full cost recovery
for any documented hours of service provided by such employee during such
Party's normal working hours.
5 .5 Chief Executive Officer. The Board shall appoint a Chief Executive Officer for
the Authority, who shall be responsible for the day-to-day operation and
management of the Authority and the CCA Program. The Chief Executive Officer
may not be an elected member of the Board or otherwise represent any Party to
the Authority. The Chief Executive Officer may exercise all powers of the
Authority, except those powers specifically reserved to the Board, including but
not limited to those set forth in Section 4.6 (Specific Responsibilities of the
Board) of this Agreement or the Authority's bylaws, or those powers which by
law must be exercised by the Board. The Chief Executive Officer may enter into
and execute power purchase agreements and other contracts, in accordance with
criteria and policies established by the Board.
5.6 General Counsel. The Board shall appoint a qualified person to act as the
Authority's General Counsel, who shall not be a member of the Board, or an
elected official or employee of a Party.
5. 7 Bonding of Persons Having Access to Property. Pursuant to the Act, the Board
shall designate the public officer or officers or person or persons who have charge
of, handle, or have access to any property of the Authority exceeding a value as
established by the Board, and shall require such public officer or officers or
person or persons to file an official bond in an amount to be fixed by the Board.
5.8 Privileges and Immunities from Liability. All of the privileges and immunities
from liability, exemption from laws, ordinances and rules, all pension, relief,
disability, workers' compensation and other benefits which apply to the activities
of officers, agents or employees of a public agency when performing their
respective functions shall apply to the officers, agents or employees of the
Authority to the same degree and extent while engaged in the performance of any
of the functions and other duties of such officers, agents or employees under this
Agreement. None of the officers, agents or employees directly employed by the
Board shall be deemed, by reason of their employment by the Authority to be
employed by the Parties or by reason of their employment by the Authority, to be
subject to any of the requirements of the Parties.
-13 -
May 12, 2020 Item #8 Page 21 of 137
5.9 Commissions, Boards and Committees. The Board may establish any advisory
commissions, boards, and committees as the Board deems appropriate to assist the
Board in carrying out its functions and implementing the CCA Program, related
energy programs, and the provisions of this Agreement. To the extent possible,
the commissions, boards, and committees should have equal representation from
each Party. The Board may establish criteria to qualify for appointment on its
commissions, boards, and committees. The Board may establish rules,
regulations, policies, or procedures to govern any such commissions, boards, or
committees and shall determine whether members shall be entitled to
reimbursement for expenses. The meetings of the commissions, boards, or
committees shall be held in accordance with the requirements of the Ralph M.
Brown Act, as applicable.
6. IMPLEMENTATION ACTION AND AUTHORITY DOCUMENTS
6.1 Preliminary Implementation of the CCA Program.
6.1.1 Enabling Ordinance. In addition to the execution of this Agreement, each
Party shall adopt an ordinance in accordance with Public Utilities Code
Section 366.2(c)(l2) for the purpose of specifying that the Party intends to
implement a CCA Program by and through its participation in the
Authority.
6.1.2 Implementation Plan. The Authority shall secure Board approval of an
Implementation Plan meeting the requirements of Public Utilities Code
Section 366.2 and any applicable Public Utilities Commission regulations,
and consistent with the terms of this Agreement, as soon after the
Effective Date as reasonably practicable but no later than December 31,
2019.
6.2 Authority Documents. The Parties acknowledge and agree that the affairs of the
Authority will be implemented through various documents duly adopted by the
Board through Board resolution or minute action, including but not necessarily
limited to operational procedures and policies, the annual budget, and specific
plans such as a local renewable energy development and integration plan and
other policies defined as the Authority Documents by this Agreement. All such
Authority Documents shall be consistent with and designed to advance the goals
and objectives of the Authority as expressed in this Agreement. The Parties agree
to abide by and comply with the terms and conditions of all such Authority
Documents that may be adopted by the Board, subject to the Parties' right to
withdraw from the Authority as described in Section 8 (Withdrawal and
Termination) of this Agreement.
6.3 Integrated Resource Plan and Regulatory Compliance. The Authority shall
cause to be prepared an Integrated Resource Plan in accordance with California
Public Utilities Commission regulations, and consistent with the terms of this
Agreement, that will ensure the long-term development and administration of a
-14 -
May 12, 2020 Item #8 Page 22 of 137
variety of energy programs that promote local renewable resources, conservation,
demand response, and energy efficiency, while maintaining compliance with
other regulatory requirements including the State Renewable Portfolio Standard
(RPS) and customer rate competitiveness.
6.4 Renewable Portfolio Standards. The Authority shall provide its customers
energy primarily from Category 1 and Category 2 eligible renewable resources, as
defined under the California RPS and consistent with the goals of the CCA
Program. The Authority shall avoid the procurement of energy from Category 3
eligible renewable resources (unbundled Renewable Energy Credits or RECs) to
the extent feasible. The Authority's ultimate objective shall be to achieve-and
sustain-a renewable energy portfolio with 100 percent renewable energy
availability and usage, at competitive rates, within the Authority service territory
by no later than 2035, and then beyond.
6.5 Power Supply Requirements. The Authority's power supply base product will
be greater than or equal to 50% qualified renewable resources. The Board shall
establish product options with higher renewable and/or GHG-free content that
each Party may select (such as 75% or 100% renewable content). In no event
will the Authority's power supply base product contain a lesser amount of
renewable resources than the base product provided by SDG&E to its customers.
Power supply options established by the Board will allow each Party the
flexibility to achieve its CAP goals without impeding any other Party from doing
the same.
6.6 Continuation and Transition of City of Solana Beach's Existing CCA
Program. The City of Solana Beach has been operating a CCA program within
its jurisdiction since 2018. The City of Solana Beach shall be permitted to
continue to operate its existing CCA program until the Authority's CCA Program
commences service to customers within the jurisdiction of the City of Solana
Beach. The transition of CCA customers within the City of Solana Beach to the
Authority's CCA Program shall be implemented in accordance with the
Authority's implementation plan approved by the Board and certified by the
CPUC and any policies and requirements established by the Board.
7. FINANCIAL PROVISIONS
7.1 Fiscal Year. The Authority's fiscal year shall be 12 months commencing July 1
and ending June 30. The fiscal year may be changed by Board resolution.
7.2 Depository.
7.2.1 All funds of the Authority shall be held in separate accounts in the name
of the Authority and not commingled with funds of any Party or any other
person or entity.
-15 -
May 12, 2020 Item #8 Page 23 of 137
7.2.2 All funds of the Authority shall be strictly and separately accounted for,
and regular reports shall be rendered of all receipts and disbursements, at
least quarterly during the fiscal year. The books and records of the
Authority shall be open to inspection and duplication by the Parties at all
reasonable times. Annual financial statements shall be prepared in
accordance with Generally Accepted Accounting Principles of the United
States of America within 6 months of the close of the fiscal year. The
Board shall contract with a certified public accountant to make an annual
audit of the financial statements of the Authority, which shall be
conducted in accordance with the requirements of Section 6505 of the Act.
7.2.3 All expenditures shall be made in accordance with the approved budget
and upon the approval of any officer so authorized by the Board in
accordance with its policies and procedures.
7.3 Budget and Recovery Costs.
7.3.1 Budget. The initial budget shall be approved by the Board. The Board
may revise the budget from time to time as may be reasonably necessary
to address contingencies and unexpected expenses. All subsequent
budgets of the Authority shall be prepared and approved by the Board in
accordance with its fiscal management policies that should include a
deadline for approval.
7.3.2 Funding oflnitial Costs. The Initial Costs of establishing the Authority
and implementing its CCA Program shall be divided equally among the
Founding Members. In the event that the CCA Program becomes
operational, these Initial Costs paid by the Founding Members shall be
included in the customer charges for electric services to the extent
permitted by law. The Authority may establish a reasonable time period
over which such costs are recovered and reimbursed to the Founding
Members. In the event that the CCA Program does not become
operational, the Founding Members shall not be entitled to any
reimbursement of the Initial Costs they have paid from the Authority or
any Party.
7.3.3 CCA Feasibility and Governance Report Costs. In the event that the CCA
Program becomes operational, any costs incurred by the Parties in
preparing CCA Feasibility or Governance Reports in connection with
establishing the Authority shall be included in the customer charges for
electric services to the extent permitted by law. The Authority may
establish a reasonable time period over which such costs are recovered and
reimbursed to the Parties that incurred such costs. In the event that the
CCA Program does not become operational, no Party shall be entitled to
any reimbursement of these costs from the Authority or any Party.
-16 -
May 12, 2020 Item #8 Page 24 of 137
7.3.4 Program Costs. The Parties intend that all costs incurred by the Authority
that are directly or indirectly attributable to the provision of electric or
other services under the CCA Program, including the establishment and
maintenance of various reserve and performance funds, shall be recovered
through appropriate charges to CCA customers receiving such services.
7.3.5 No Requirement for Contributions or Payments. Parties are not required
under this Agreement to make any financial contributions or payments to
the Authority, and the Authority shall have no right to require such a
contribution or payment unless expressly set forth herein (for example, as
provided in Section 2.4.3, with respect to Additional Members, Section
7.3.2 with respect to Initial Costs and Section 8.1, with respect to
Withdrawal), or except as otherwise required by law.
Notwithstanding the foregoing, a Party may voluntarily enter into an
agreement with the Authority to provide the following:
( a) contributions of public funds for the purposes set forth in this
Agreement;
(b) advances of public funds for the purposes set forth in this
Agreement, such advances to be repaid as provided by such written
agreement; or
(c) its personnel, equipment or property in lieu of other contributions
or advances.
No Party shall be required, by or for the benefit of the Authority, to adopt
any local tax, assessment, fee or charge under any circumstances.
7.4 Accounts and Reports. The Treasurer shall establish and maintain such funds
and accounts as may be required by good accounting practice or by any provision
of any trust agreement entered into with respect to the proceeds of any bonds
issued by the Authority. The books and records of the Authority in the hands of
the Treasurer shall be open to inspection and duplication at all reasonable times
by duly appointed representatives of the Parties. The Treasurer, within 180 days
after the close of each fiscal year, shall give a complete written report of all
financial activities for such fiscal year to the Parties. The Treasurer shall
cooperate with all audits required by this Agreement.
7.5 Funds. The Treasurer shall receive, have custody of and/or disburse Authority
funds in accordance with the laws applicable to public agencies and generally
accepted accounting practices, and shall make the disbursements required by this
Agreement in order to carry out any of the purposes of this Agreement.
7 .6 Discretionary Revenues. The Board shall establish policies concerning the
expenditure of discretionary revenues. As determined by the Board in such
policies, discretionary revenues may be used to (1) provide programs and develop
-17 -
May 12, 2020 Item #8 Page 25 of 137
projects of the Authority or (2) allow Parties to direct funds into qualified
Authority programs and projects, or provide other ratepayer benefits. The Board
shall endeavor to achieve a balanced distribution of program and project benefits
substantially commensurate with each Party's energy load ("balanced
distribution"). The Board shall conduct periodic audits no less than every two
years in order to verify the balanced distribution of program and project benefits
and take any corrective action necessary to achieve or continue to maintain a
balanced distribution.
7. 7 Rate Related Programs. The Authority will maintain residential net energy
metering and low-income rate discount programs.
8. WITHDRAWAL AND TERMINATION
8.1 Withdrawal
8.1.1 Withdrawal by Parties. Any Party may withdraw its membership in
the Authority, effective as of the beginning of the Authority's fiscal
year, by giving no less than one year advance written notice of its
election to do so, which notice shall be given to the Authority and
each Party. The Board, in its discretion, may approve a shorter notice
period on a case by case basis. In addition, a Party may immediately
withdraw its membership in the Authority upon written notice to the
Board at any time prior to the Authority filing its first year-ahead load
forecast with the CPUC that included the Party's load (anticipated to
occur in April 2020) without any financial obligation other than its
share of Initial Costs that shall not be reimbursed and any costs
directly related to the resulting amendment of the Implementation
Plan. Withdrawal of a Party shall require an affirmative vote of the
Party's Governing Body.
8.1.2 Amendment. Notwithstanding Section 8.1.1 (Withdrawal by Parties)
of this Agreement, a Party may withdraw its membership in the
Authority upon approval and execution of an amendment to this
Agreement provided that the requirements of this Section 8.1.2 are
strictly followed. A Party shall be deemed to have withdrawn its
membership in the Authority effective one year ( or earlier if approved
by the Board) after the Board approves an amendment to this
Agreement if the Director representing such Party has provided notice
to the other Directors immediately preceding the Board's vote of the
Party's intention to withdraw its membership in the Authority, should
the amendment be approved by the Board.
8.1.3 Continuing Liability; Further Assurances. A Party that withdraws its
membership in the Authority may be subject to certain continuing
liabilities, as described in Section 8.5 (Continuing Liability; Refund)
of this Agreement, including, but not limited to, power purchase
-18 -
May 12, 2020 Item #8 Page 26 of 137
agreements and other Authority contracts and operational obligations.
The withdrawing Party and the Authority shall execute and deliver all
further instruments and documents and take any further action that
may be reasonably necessary, as determined by the Board, to
effectuate the orderly withdrawal of such Party from membership in
the Authority. The Board shall also consider, pursuant to Section
3 .2.12, adoption of a policy that allows a withdrawing Party to
negotiate assignment to the Party of costs of electric power or other
resources procured on behalf of its customers by the Authority upon
its withdrawal. In the implementation of this Section 8.1.3, the
Parties intend, to the maximum extent possible, without
compromising the viability of ongoing Authority operations, that any
claims, demands, damages, or liabilities covered hereunder, be funded
from the rates paid by CCA Program customers located within the
service territory of the withdrawing Party, and not from the general
fund of the withdrawing Party itself.
8.2 Termination of CCA Program. Nothing contained in Section 6 or elsewhere in
this Agreement shall be construed to limit the discretion of the Authority to
terminate the implementation or operation of the CCA Program at any time in
accordance with any applicable requirements of state law.
8.3 Involuntary Termination. This Agreement may be terminated with respect to a
Party for material non-compliance with provisions of this Agreement or Authority
Documents upon a two-thirds vote of the entire Board excluding the vote of the
Party subject to possible termination. Prior to any vote to terminate this
Agreement with respect to a Party, wTitten notice of the proposed termination and
the reason(s) for such termination shall be delivered to the Party whose
termination is proposed at least 30 days prior to the regular Board meeting at
which such matter shall first be discussed as an agenda item. The written notice
of proposed termination shall specify the particular provisions of this Agreement
or the Authority Documents that the Party has allegedly violated. The Party,
subject to possible termination, shall have the opportunity at the next regular
Board meeting to respond to any reasons and allegations that may be cited as a
basis for termination prior to a vote regarding termination. A Party that has had
its membership in the Authority terminated may be subject to certain continuing
liabilities, as described in Section 8.5 (Continuing Liability; Refund) of this
Agreement.
8.4 Mutual Termination. This Agreement may be terminated by mutual agreement
of all the Parties; provided, however, the foregoing shall not be construed as
limiting the rights of a Party to withdraw its membership in the Authority, and
thus terminate this Agreement with respect to such withdrawing Party, as
described in Section 8.1 (Withdrawal) of this Agreement.
8.5 Continuing Liability; Refund. Upon a withdrawal or involuntary termination of
a Party, the Party shall be responsible for any claims, demands, damages, or
-19 -
May 12, 2020 Item #8 Page 27 of 137
liabilities attributable to the Party through the effective date of its withdrawal or
involuntary termination, it being agreed that the Party shall not be responsible for
any claims, demands, damages, or liabilities commencing or arising after the
effective date of the Party's withdrawal or involuntary termination.
Notwithstanding the foregoing or any other provisions of this Agreement, such
Party also shall be liable to the Authority for (a) any damages, losses, or costs
incurred by the Authority which result directly from the Party's withdrawal or
termination, including but not limited to costs arising from the resale of capacity,
electricity, or any attribute thereof no longer needed to serve such Party's load;
and (b) any costs or obligations associated with the Party's participation in any
program in accordance with the program's terms, provided such costs or
obligations were incurred prior to the withdrawal of the Party. From and after the
date a Party provides notice of its withdrawal or is terminated, the Authority shall
reasonably and in good faith seek to mitigate any costs and obligations to be
incurred by the withdrawing or terminated Party under this Section through
measures reasonable under the circumstances, provided that this obligation to
mitigate does not impose any obligation on the Authority to transfer any cost or
obligation directly attributable to the membership and withdrawal or termination
of the withdrawing or terminated party to the ratepayers of the remaining
members. Further, the liability of the withdrawing or terminated Party shall be
based on actual costs or damages incurred by the Authority and shall not include
any penalties or punitive charges imposed by the Authority. The Authority may
withhold funds otherwise owing to the Party or may require the Party to deposit
sufficient funds with the Authority, as reasonably determined by the Authority, to
cover the Party's liability for the costs described above. The withdrawing or
terminated Party agrees to pay any such deposit determined by the Authority.
Any amount of the Party's funds held on deposit with the Authority above that
which is required to pay any liabilities or obligations shall be returned to the
Party. In the implementation of this Section 8.5, the Parties intend, to the
maximum extent possible, without compromising the viability of ongoing
Authority operations, that any claims, demands, damages, or liabilities covered
hereunder, be funded from the rates paid by CCA Program customers located
within the service territory of the withdrawing Party, and not from the general
fund of the withdrawing Party itself. The liability of a withdrawing Party under
this Section shall be only to the Authority and not to any other Party.
8.6 Disposition of Authority Assets. Upon termination of this Agreement and
dissolution of the Authority by all Parties, after payment of all obligations of the
Authority, the Board may sell or liquidate Authority property and shall distribute
any remaining assets to the Parties in proportion to the contributions made by the
existing Parties. Any assets provided by a Party to the Authority shall remain the
asset of that Party and shall not be subject to distribution under this section.
9. MISCELLANEOUS PROVISIONS
9 .1 Dispute Resolution. The Parties and the Authority shall make reasonable efforts
to settle all disputes arising out of or in connection with this Agreement. Before
-20 -
May 12, 2020 Item #8 Page 28 of 137
exercising any remedy provided by law, a Party or the Parties and the Authority
shall engage in nonbinding mediation in the manner agreed upon by the Party or
Parties and the Authority. The Parties agree that each Party may specifically
enforce this section. In the event that nonbinding mediation is not initiated or does
not result in the settlement of a dispute within 60 days after the demand for
mediation is made, any Party and the Authority may pursue any remedies
provided by law.
9.2 Liability of Directors, Officers, and Employees. The Directors, officers, and
employees of the Authority shall use ordinary care and reasonable diligence in the
exercise of their powers and in the performance of their duties pursuant to this
Agreement. No current or former Director, officer, or employee will be
responsible for any act or omission by another Director, officer, or employee.
The Authority shall defend, indemnify and hold harmless the individual current
and former Directors, officers, and employees for any acts or omissions in the
scope of their employment or duties in the manner provided by Government Code
Section 995 et seq. Nothing in this section shall be construed to limit the defenses
available under the law, to the Parties, the Authority, or its Directors, officers, or
employees. In addition, pursuant to the Act, no Director shall be personally liable
on the Authority's bonds or be subject to any personal liability or accountability
by reason of the issuance of bonds.
9.3 Insurance and Indemnification of Parties. The Authority shall acquire such
insurance coverage as is necessary to protect the interests of the Authority and the
Parties. The Authority shall defend, indemnify and hold harmless the Parties and
each of their respective governing board members, officers, agents and
employees, from any and all claims, losses, damages, deductibles or self-insured
retentions, costs, fines, penalties, injuries and liabilities of every kind arising
directly or indirectly from the conduct, activities, operations, acts, errors,
omissions or negligence of the Authority or its officers, employees, agents,
contractors, licensees or volunteers.
9.4 No Third Party Beneficiaries. The provisions of this Agreement are for the sole
benefit of the Parties and the Authority and not for the benefit of any other person
or entity. No third party beneficiary shall be created by or arise from the
provisions of this Agreement.
9.5 Notices. Any notice required or permitted to be made hereunder shall be in
writing and shall be delivered in the manner prescribed herein at the principal
place of business of each Party. The Parties may give notice by (1) personal
delivery; (2) e-mail; (3) U.S. Mail, first class postage prepaid, or a faster delivery
method; or (3) by any other method deemed appropriate by the Board.
Upon providing written notice to all Parties, any Party may change the designated
address or e-mail for receiving notice.
-21 -
May 12, 2020 Item #8 Page 29 of 137
All written notices or correspondence sent in the described manner will be
deemed given to a party on whichever date occurs earliest: (1) the date of personal
delivery; (2) the third business day following deposit in the U.S. mail, when sent
by "first class" mail; or (3) the date of transmission, when sent by e-mail or
facsimile.
9.6 Successors. This Agreement shall be binding upon and shall inure to the benefit
of the successors of each Party.
9.7 Assignment. Except as otherwise expressly provided in this Agreement, the
rights and duties of the Parties may not be assigned or delegated without the
advance written consent of all of the other Parties, and any attempt to assign or
delegate such rights or duties in contravention of this section shall be null and
void. This Agreement shall inure to the benefit of, and be binding upon, the
approved assigns of the Parties. This section does not prohibit a Party from
entering into an independent agreement with another agency, person, or entity
regarding the financing of that Party's contributions to the Authority, or the
disposition of the proceeds which that Party receives under this Agreement, so
long as such independent agreement does not affect, or purport to affect, the rights
and duties of the Authority or the Parties under this Agreement.
9.8 Amendment. This Agreement may be amended by a written amendment
approved by the Board in accordance with the Special Voting requirements of
Section 4.12.
9.9 Severability. If any one or more of the terms, provisions, promises, covenants, or
conditions of this Agreement were adjudged invalid or void by a court of
competent jurisdiction, each and all of the remaining terms, provisions, promises,
covenants, and conditions of this Agreement shall not be affected thereby and
shall remain in full force and effect to the maximum extent permitted by law.
9.10 Governing Law. This Agreement is made and to be performed in the State of
California, and as such California substantive and procedural law shall apply.
9.11 Headings. The section headings herein are for convenience only and are not to
be construed as modifying or governing the language of this Agreement.
9.12 Counterparts. This Agreement may be executed in any number of counterparts,
and upon execution by all Parties, each executed counterpart shall have the same
force and effect as an original instrument and as if all Parties had signed the same
instrument. Any signature page of this Agreement may be detached from any
counterpart of this Agreement without impairing the legal effect of any signatures
thereon and may be attached to another counterpart of this Agreement identical in
form hereto but having attached to it one or more signature pages.
The Parties hereto have executed this Joint Powers Agreement establishing the Clean Energy
Alliance.
-22 -
May 12, 2020 Item #8 Page 30 of 137
Exhibit A: Definitions
"AB 117" means Assembly Bill 117 (Stat. 2002, Ch. 838, codified at Public Utilities Code
Section 366.2), which created Community Choice Aggregation.
"Act" means the Joint Exercise of Powers Act of the State of California (Chapter 5, Division 7,
Title 1 of the Government Code commencing with Section 6500).
"Agreement" means this Joint Powers Agreement.
"Authority" means the Clean Energy Alliance.
"Authority Document(s)" means document(s) duly adopted by the Board by resolution or motion
implementing the powers, functions and activities of the Authority, including but not
limited to the Operating Policies and Procedures, the annual budget, and plans and
policies.
"Board" means the Board of Directors of the Authority.
"Community Choice Aggregation" or "CCA" means an electric service option available to cities,
counties, and other public agencies pursuant to Public Utilities Code Section 366.2.
"CCA Program" means the Authority's Community Choice Aggregation program established,
conducted and operated under Public Utilities Code Section 366.2.
"Days" shall mean calendar days unless otherwise specified by this Agreement.
"Director" means a member of the Board representing a Party appointed in accordance with
Sections 4.1 (Board of Directors) and 4.2 (Appointment and Removal of Directors) of
this Agreement.
"Effective Date" means the date on which the Agreement shall become effective and the
Authority shall exist as a separate public agency, as further described in Section 2.1
(Effective Date and Term) of this Agreement.
"Founding Member" means any jurisdiction that becomes a member of the Authority before
October 1, 2020, as identified in Exhibit B.
"Governing Body" means for any city, its City Council; and for any other public agency, the
equivalent policy making body that exercises ultimate decision-making authority over
such agency.
"Initial Costs" means reasonable and necessary implementation costs advanced by the Founding
Members in support of the formation of the Authority and approved by the Board for
reimbursement, which are (a) directly related to the establishment of the Authority and its
CCA program, and (b) incurred by the Authority or its Members relating to the initial
operation of the Authority, such as the hiring of the executive and operations staff, any
required accounting, administrative, technical and legal services in support of the
May 12, 2020 Item #8 Page 34 of 137
Authority's initial formation activities or in support of the negotiation, preparation and
approval of power purchase agreements, and activities associated with drafting and
obtaining approval of the Authority's implementation plan. Initial Costs do not include
costs associated with the investigation of the CCA model, attendance at routine planning
meetings, or a Party's pre-formation reports related to their decision to pursue CCA or
join the Authority. Initial costs also do not include the costs incurred by the City of
Solana Beach relating to the termination of its CCA program. The Authority Board shall
determine the repayment timing and termination date for the Initial Costs.
"Investor Owned Utilities" means a privately-owned electric utility whose stock is publicly
traded and is subject to CPUC regulation.
"Parties" means, collectively, the signatories to this Agreement that have satisfied the conditions
as defined above for "Founding Members" or in Section 2.4 (Addition of Parties) of this
Agreement, such that they are considered members of the Authority.
"Party" means, singularly, a signatory to this Agreement that has satisfied the conditions as
defined above for "Founding Members" or in Section 2.4 (Addition of Parties) of this
Agreement, such that it is considered a member of the Authority.
-2 -
May 12, 2020 Item #8 Page 35 of 137
Exhibit B: List of Founding Members
Any public agency that becomes a member by October 1, 2020
City of Carlsbad
City of Del Mar
City of Solana Beach
May 12, 2020 Item #8 Page 36 of 137
Exhibit 3
RESOLUTION NO. 2019-229
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD
ACCEPTING THE PEER REVIEW OF NORTH SAN DIEGO COUNTY CITIES
COMMUNITY CHOICE ENERGY TECHNICAL FEASIBILITY STUDY AND
AUTHORIZING THE CITY MANAGER TO NEGOTIATE, EXECUTE AND
FUND A COST REIMBURSEMENT FOR MEMBER AGENCY SUPPORT
AGREEMENT ALLOWING FOR THE CITY OF CARLSBAD'S
PARTICIPATION IN FUNDING THE FISCAL YEAR 2019-20 INITIAL
BUDGET OF THE CLEAN ENERGY ALLIANCE JOINT POWERS AUTHORITY
IN THE AMOUNT OF $150,000
WHEREAS, Community Choice Energy is a mechanism that allows local governments to
purchase and supply electrical power to customers within their jurisdictions as an alternative to
the service provided by an investor-owned utility; and
WHEREAS, the terms 'Community Choice Energy' (CCE) and 'Community Choice
Aggregation' (CCA) are used interchangeably; and
WHEREAS, on April 16, 2019, the Carlsbad City Council received the final North San Diego
County Cities Community Choice Energy Technical Feasibility Study (Study), dated March 28,
2019;and
WHEREAS, the Study determined that a CCA program is both technically and financially
feasible, and could provide environmental and economic benefits to residents and businesses in
the City of Carlsbad; and
WHEREAS, on August 20, 2019, the Carlsbad City Council directed staff to obtain a peer
review analysis of the Study; and
WHEREAS, the city engaged Pacific Energy Advisors, Inc., to provide a Peer Review of the
Study; and
WHEREAS, Pacific Energy Advisors' Peer Review of the Study, dated November 4, 2019,
did not discover any fatal flaws that would jeopardize anticipated feasibility of the CCA program;
and
WHEREAS, on October 8, 2019, the Carlsbad City Council adopted Resolution No. 2019-
197 approving and authorizing the execution of the Joint Exercise of Powers Agreement creating
the Clean Energy Alliance, a CCA Joint Powers Authority; and
WHEREAS, on October 15, 2019, the Carlsbad City Council approved Ordinance No. CS-
362 authorizing the implementation of a CCA program in Carlsbad; and
WHEREAS, on November 5, 2019, the Clean Energy Alliance (CEA) Joint Powers Authority
Board of Directors reviewed CEA's draft fiscal year 2019-20 Initial Budget, which estimates initial
costs to be $450,000; and
May 12, 2020 Item #8 Page 37 of 137
eventual operating outcomes for the prospective CCA program could be somewhat better than reflected
in the Study (based on current market conditions, which are subject to change). Overall cost of service
projections for the prospective CCA program were noted as consistent with ranges observed for other
CCA organizations. During its review, PEA observed that certain, relatively recent changes related to
California's legislative and regulatory landscape may require further consideration as the Partners
continue evaluating CCA as an alternative to traditional electric services provided by SDG&E. These items
include Senate Bill 350's1 long-term Renewables Portfolio Standard (RPS) contracting requirement, and
California Public Utilities Commission (CPUC) Ruling 17-09-020's2 multi-year local resource adequacy (RA)
procurement requirement. While neither item materially alters PEA's impressions regarding CCA program
viability, it is important for the Partners to be aware of resultant impacts to the resource planning
obligations that pertain to CCA organizations, as neither topic was addressed in the Study. Additional
detail related to each of these topics is provided in greater detail below under the "Other Considerations"
section.
While the Partners were provided with four distinct governance options, this Review focuses on the Base
Case scenario, which assumed that all of the Partners would proceed with the formation of a single Joint
Powers Authority (the members of which would be the Partners' respective communities) that would
administer the CCA Program -this CCA governance structure has been successfully deployed in numerous
regions throughout California. Key aspe'cts of PEA's Review were intended to address: 1) the
appropriateness of key assumptions upon which the Study was based; 2) the reasonableness of noted
operating projections relative to the experience of similar CCA organizations; 3) the identification of any
noteworthy inconsistencies between key elements of the Study and observations derived from PEA's
direct experience launching and supporting numerous California CCAs; and 4) descriptions of any recent
developments, including market-related and/or policy-related changes, that could materially alter
expected operating results relative to projections reflected in the Study.
Assessment of Key Considerations
Rates
In forecasting generation and delivery rates charged by SDG&E, the Study calculated the delivery
component using SDG&E's General Rate Case filing for 2019-2021 as a starting point, with an annual
escalation rate of 2% that was generally based on inflationary expectations. The forecast for SDG&E's
generation rate was based on an assumed resource mix that was comprised of market purchases and
long-term renewable energy contracts. While the cost of market purchases is expected to increase over
time, the Study suggests that costs associated with long-term renewable contracts are expected to
decrease, resulting in a net 1% annual growth rate (in SDG&E's anticipated generation rates) starting in
2020. Overall, both projected delivery and generation rates seem reasonable in consideration of the base
year forecast and related escalation rates during the 10-year study period.
1 SB 350 399.13.8{b): A retail seller may enter into a combination of long-and short-term contracts for electricity
and associated renewable energy credits. Beginning January 1, 2021, at least 65 percent of the procurement a retail
seller counts toward the renewables portfolio standard requirement of each compliance period shall be from its
contracts of 10 years or more in duration or in its ownership or ownership agreements for eligible renewable energy
resources.
2 CPUC R.17-09-020 states that as of the 2020 compliance year, local requirements are set three years ahead and
updated each year. Local requirements are further broken down into sub-local areas.
2
May 12, 2020 Item #8 Page 40 of 137
Financing Costs
The Study envisioned pre-launch financing costs of $2 million in 2020 (consisting primarily of start-up
costs), and $14 million in 2021 for working capital. Based upon PEA's observations related to the
experiences of currently operational CCAs, projected financing costs reflected in the Study seem
reasonable and in alignment with our expectations. Further, the assumption to pay off debt within three
years of service commencement are also in line with the experiences of other CCAs. As CCAs have become
more prevalent and successful operational track records continue to build (note that two CCAs now have
investment grade credit ratings), obtaining necessary funding via bank loans or other sources should not
be an issue. In fact, PEA has observed that one or more financial institutions has now created a clean
energy division that caters to this growing market segment.
Power Supply Cost and Operating Expense Assumptions
PEA reviewed the Study's price forecasts for the following energy products, each of which was included
in projected power supply costs, the largest component of a CCA program's operating budget:
• Power purchased within the California Independent System Operator (CAISO) market;
• Renewable energy purchased under long-term power supply contracts;
• Renewable energy/renewable energy credits purchased under short-term power supply
contracts;
• Greenhouse gas (GHG) free energy supply; and
• Resource adequacy capacity
On an overall basis, projected power supply costs were reasonable and tended to be conservative relative
to similar projections prepared by PEA (see Table 1 below). The Study's assumptions related to market
prices, long-term renewable energy prices, and short-term renewable energy prices were generally
higher compared to similar forecasts prepared by PEA. GHG-free and RA prices were generally lower than
those projected by PEA. After netting the offsetting impacts of these differences, there is a non-
substantive impact to overall power cost estimates.
When verifying the appropriateness of such costs, PEA benchmarked the Study's "Power Supply Costs as
a Percentage of Revenues" against similar ratios for PEA's CCA clientele operating within Southern
California. The comparative results indicated that over the 10-year period spanning the 2021-2030
calendar years, power supply costs reflected in the Study represented 86% of projected revenues, a figure
that falls well within the range of 83%-93% which was observed for other CCA programs.
Similarly, PEA reviewed the following additional (non-power supply) operational cost components, or
"other operating expenses":
• Fees related to billing and data management services;
• SDG&E fees;
• Technical Consulting and Legal fees;
• Staffing costs; and
• General and Administrative expenses
3
May 12, 2020 Item #8 Page 41 of 137
Similar to PEA's assessment of projected power supply costs, anticipated other operating expenses were
also found to be reasonable (see Table 1 below). After performing a similar benchmarking exercise for
"Other Operating Expenses as a Percentage of Revenues" (net of energy costs and debt service payments),
PEA determined that these projected cost estimates were also within reasonable ranges. In particular,
the Study indicated an estimated average ratio of 5% (representing other operating expenses, divided by
revenues), which is also in line with PEA's expectations for this component of a CCA program's operating
budget.
Table 1: Summary of Power Supply Cost Forecasts and Ratios
2021-2030 Period Averages EESStudy PEA Notes
All-in Power Supply Cost ($/MWh) $72.61 $70.15 PEA forecast based on most recent forward curves
Power Supply Cost/Revenue 86% 83%-93% PEA forecasted range based on similar CCAs
Operating Expense/Revenue 5% 5% PEA forecast based on similarCCAs
Other Considerations: Potential Impacts to Resource Planning and Procurement Activities
During PEA's review of the Study, there were several additional items that, while not critically important
in determining program feasibility, will need to be addressed as the Partners continue evaluating CCA
formation. There are also various ongoing efforts related to the disposition of utility power resources,
including renewable energy and carbon-free supply. Such processes may result in allocations of such
resources to CCAs, which could beneficially impact resource planning and procurement efforts. These
items are further described below.
SB 350 Long-term RPS Requirement
SB 350 requires all load serving entities to have at least 65% of their Renewables Portfolio Standard
("RPS") procurement mandate secured via contracts of ten years or longer during each compliance period
starting on January 1, 2021. The Study does not mention this requirement, but compliance with this
element of SB 350 should be included in portfolio planning.
According to the Study, the Base Case assumes an average long-term renewable energy price of
$42/MWh, and an average short-term renewable energy price of $62/MWh. The Study assumes the
exclusive procurement of short-term renewable energy for the first three years of program operation with
the layering of increasing proportions of long-term renewable energy over time, growing from 10% in year
4, to 20% in year 5, and 25% in years 6 through 20. Relative to assumptions reflected in the Study, the
phasing of long-term renewable energy purchases will need to occur more quickly and significantly under
the requirements of SB 350, but current pricing trends within renewable energy markets suggest that
longer-term purchases can be more cost effective (when compared to short-term purchases), reducing
overall energy supply costs for the Partners if current market conditions continue to persist. Regarding
long-term renewable energy contracting, there is some risk related to the ability of a CCA to secure such
contracts in time to meet pertinent compliance deadlines. However, the multi-year compliance periods
reflected in SB 350 (i.e., Compliance Period 4, which begins January 1, 2021 and continues through
December 31, 2024; Compliance Period 5, which begins January 1, 2025 and continues through December
31, 2027; and Compliance Period 6, which beings January 1, 2028 and continues through December 31,
2030) are intended to promote some flexibility in achieving these long-term contracting obligations and
should ease challenges ofthe CCA Program in meeting this compliance obligation during initial operations.
4
May 12, 2020 Item #8 Page 42 of 137
Further, any concerns related to creditworthiness of the CCA (during early-stage operations) when
pursuing long-term renewable energy contracts can be effectively addressed through the implementation
of various contracting/structural strategies, including lock-box structures, credit assurances, and
demonstration of agreed upon debt-to-income ratios by the CCA program, amongst others.
R.17-09-020 Multi-year Local RA Requirement
CPUC Ruling 17-09-020 is a relatively recent requirement, which obligates the advance procurement of
local RA in three-year compliance cycles. PEA understands that this requirement was not addressed in
the Study, so the Partners should be aware of this obligation. Based on current conditions within
California's RA market, securing requisite supply in multi-year cycles has become increasingly challenging
and typically requires considerable coordination within the procurement function. As a mitigating factor,
there currently is a compliance waiver option for local RA (for non-compliant LSEs that can demonstrate
commercially reasonable attempts to procure, even though such efforts were unsuccessful). An effort is
underway, spearheaded by the California Community Choice Association, to expand the waiver program
for system and flexible RA as well. Finally, because the local RA requirement is effective on January 1st of
the year in which a new CCA commences service, the Partners should consider an earlier 2021 launch date
if economically feasible.
Greenhouse Gas (GHG) Free Allocation Work in Progress
On October 11, 2018 the CPUC issued Decision (D.)18-10-019 modifying the Power Charge Indifference
Adjustment {PCIA) Methodology and opening a second phase of this proceeding to enable parties to
further develop proposals for portfolio optimization and cost reduction for future consideration by the
Commission. On February 1, 2019, the Commission issued the Phase 2 Scoping Memo R.17-06-26, which
directed the parties to convene three working groups to further develop PCIA-related proposals for
consideration by the Commission. One of the working groups, Working Group 3 (WG 3) is focused on
portfolio optimization and is tasked with answering the question of 11what are the structures, processes,
and rules governing portfolio optimization that the Commission should consider in addressing excess
resources in utility portfolios?"
One of the excess resources unde_r consideration focuses on a proposal to allocate the investor-owned
utilities' {IOU) GHG-free portfolios, which consists of large hydro and nuclear generating facilities. The
draft proposal would allocate on a voluntary basis to eligible load serving entities (LSEs) their
proportionate share of GHG-free resources based on their respective load (meaning, energy required to
serve customers) relative to total load within the incumbent IOU's service territory. The impacts to
participating LSEs, including the CCA Program would be the reduction of GHG-free energy costs due to the
allocation, and potential price reductions (due to lower demand) for any additional market purchases
(e.g., some LSEs may have already procured GHG-free energy and want to monetize their allocations,
thereby flooding the market with supply).
Resource Adequacy Allocation Work in Progress
Also a part of WG 3's PCIA portfolio optimization efforts, the allocation of local, system, and flex RA is
being considered. Allocation will be based on an LSE's forecasted monthly, peak-load share as a
percentage of peak load reflected within the incumbent IOU's service territory at large. The draft proposal
contemplates a mandatory allocation for local RA, and a voluntary allocation for system and flex RA. This
would give new CCAs a head start on procurement and access to an RA market within which scarcity of
5
May 12, 2020 Item #8 Page 43 of 137
supply is becoming increasingly common (potential risk mitigating options including a waiver are listed
above).
Renewable Energy Allocation Work in Progress
The other resource category being considered for allocation within WG 3 is the renewable energy
associated with RPS contracts of the IOUs. As discussed, the RPS allocation share would be based on an
LSE's annual load share as a percentage of the relevant IOU service area. The draft proposal would allow
LSEs to decide whether they wish to accept all or a portion of their respective allocation. The potential
benefit to newly launching LSEs like the CCA Program would be the opportunity to be allocated some RPS-
eligible long-term energy from the beginning, and especially important if the CCA launch date is closer to
the end of a compliance period. As stated above, the CCA Program's expected launch date in early 2021
should provide ample time to meet applicable compliance obligations focused on renewable energy
procurement.
Conclusion
The Study provided a comprehensive analysis of the items that should be considered in assessing the
feasibility of a newly forming CCA. The energy supply costs and operating expenses used in developing
the proforma were reasonable, as were the projected SDG&E generation and distribution rates used -to
determine feasibility.
Two key items to consider for further assessment and/or inclusion are compliance with SB 350's long-
term RPS compliance requirements, and CPUC R.17-09-020's multi-year local RA requirements. The
inclusion of the former should help reduce energy procurement costs due to the inclusion of lower-priced
long-term contracts, while the inclusion of the latter would likely increase energy procurement costs from
the expected increase in market prices The overall impact of the two items may marginally alter
anticipated power supply costs, but such changes are not expected to undermine the Study's findings with
regard to program feasibility.
Some other items to consider are the various efforts that are under way from the PCIA Phase 2
proceedings with respect to the allocation of GHG-free energy, local, system and flex RA, and RPS
attributes. The allocation of all three energy products would greatly assist all newly forming CCAs to meet
their GHG-free, RPS, and RA compliance requirements. The allocation of GHG-free energy would also
reduce energy supply costs both through the structure of the allocation, and the potential decrease in
pricing due to reduced demand from LSEs.
6
May 12, 2020 Item #8 Page 44 of 137
IN ITIAL BUDGET
Staffing/Consultants
Legal Services
Professional Services
CCA Bond
CalCCA Membership & Dues
Graphic Design Services/Marketing
TOTAL PROJECTED BUDGET
Clean Energy Alliance
DRAFT FY 2019/2020 Initial Budget
FY 19/20 NOTES
$ 50,000.00 FY 19/20 Partial Year, Part Time CEO and Administrative Support
130,000.00 General Counsel & Special Counsel
115,000.00 Website Development; Technical Support
147,000.00 Required to be paid by March 2020
1,500.00 Affliliate Membership 19/20
$6,500 Logo/Mailers
$450,000.00
Costs could be funded through traditional bank financing and/or deferred
fees/partner support
Attachment B
May 12, 2020 Item #8 Page 45 of 137
CLEAN ENERGY ALLIANCE
Community Choice Aggregation
Implementation Plan
and
Statement of Intent
December 2019
Exhibit 4
May 12, 2020 Item #8 Page 46 of 137
Clean Energy Alliance Implementation Plan
i December 2019
TABLE OF CONTENTS
1 Introduction .................................................................................................................................... 4
1.1Statement of Intent ............................................................................................................................ 5
1.2Organization of this Implementation Plan .......................................................................................... 6
2 Aggregation Process ........................................................................................................................ 7
2.1Introduction ........................................................................................................................................ 7
2.2Process of Aggregation ....................................................................................................................... 8
2.3Consequences of Aggregation ............................................................................................................ 9
2.3.1 Rate Impacts ................................................................................................................... 9
2.3.2 Renewable Energy Impacts .......................................................................................... 10
2.3.3 Greenhouse Gas Reduction .......................................................................................... 10
3 Organization and Governance Structure ....................................................................................... 11
3.1Organizational Overview .................................................................................................................. 11
3.2Governance ...................................................................................................................................... 11
3.3Management .................................................................................................................................... 11
3.4Administration .................................................................................................................................. 12
3.5Finance ............................................................................................................................................. 12
3.6Marketing & Public Affairs ................................................................................................................ 12
3.7Power Resources & Energy Programs .............................................................................................. 13
3.7.1 Electric Supply Operations ........................................................................................... 13
3.8Governmental Affairs & Legal Support ............................................................................................. 14
4 Startup Plan and Funding .............................................................................................................. 15
4.1Startup Activities .............................................................................................................................. 15
4.2Staffing and Contract Services .......................................................................................................... 16
4.3Capital Requirements ....................................................................................................................... 16
4.4Financing Plan ................................................................................................................................... 17
5 Program Phase-In .......................................................................................................................... 18
6 Load Forecast & Resource Plan ..................................................................................................... 19
May 12, 2020 Item #8 Page 47 of 137
Clean Energy Alliance Implementation Plan
ii December 2019
6.1Introduction ...................................................................................................................................... 19
6.2Resource Plan Overview ................................................................................................................... 20
6.3Supply Requirements ........................................................................................................................ 21
6.4Customer Participation Rates ........................................................................................................... 22
6.5Customer Forecast ............................................................................................................................ 22
6.6Sales Forecast ................................................................................................................................... 23
6.7Capacity Requirements ..................................................................................................................... 23
6.8Renewables Portfolio Standards Energy Requirements ................................................................... 25
6.8.1 Basic RPS Requirements ............................................................................................... 25
6.8.2 CEA’s Renewables Portfolio Standards Requirement .................................................. 25
6.9Purchased Power .............................................................................................................................. 25
6.10Renewable Resources ..................................................................................................................... 26
6.11Small, Local and Diverse Business Enterprise Procurement ........................................................... 26
6.12Energy Efficiency ............................................................................................................................. 26
7 Financial Plan ................................................................................................................................ 27
7.1Description of Cash Flow Analysis .................................................................................................... 27
7.2Cost of Program Operations ............................................................................................................. 27
7.3Revenues from CCA Program Operations ......................................................................................... 27
7.4Cash Flow Analysis Results ............................................................................................................... 28
7.5Program Implementation Pro Forma ............................................................................................... 28
7.6Clean Energy Alliance Financings ...................................................................................................... 29
7.7Renewable Resource Project Financing ............................................................................................ 29
8 Rate Setting, Program Terms and Conditions ............................................................................... 30
8.1Introduction ...................................................................................................................................... 30
8.2Rate Policies ...................................................................................................................................... 30
8.3Rate Competitiveness ....................................................................................................................... 30
8.4Rate Stability ..................................................................................................................................... 31
8.5Equity among Customer Classes ....................................................................................................... 31
8.6Customer Understanding ................................................................................................................. 31
May 12, 2020 Item #8 Page 48 of 137
Clean Energy Alliance Implementation Plan
iii December 2019
8.7Revenue Sufficiency .......................................................................................................................... 31
8.8Rate Design ....................................................................................................................................... 32
8.9Net Energy Metering ........................................................................................................................ 32
8.10Disclosure and Due Process in Setting Rates and Allocating Costs among Participants ................. 32
9 Customer Rights and Responsibilities ........................................................................................... 33
9.1Customer Notices ............................................................................................................................. 33
9.2Termination Fee ............................................................................................................................... 34
9.3Customer Confidentiality .................................................................................................................. 34
9.4Responsibility for Payment ............................................................................................................... 34
9.5Customer Deposits ........................................................................................................................... 35
10 Procurement Process .................................................................................................................... 36
10.1Introduction .................................................................................................................................... 36
10.2Procurement Methods ................................................................................................................... 36
10.3Key Contracts .................................................................................................................................. 36
10.3.1 Electric Supply .............................................................................................................. 36
10.3.2 Data Management Contract ......................................................................................... 37
11 Contingency Plan for Program Termination .................................................................................. 37
11.1Introduction .................................................................................................................................... 37
11.2Termination by Clean Energy Alliance ............................................................................................ 37
12 Appendix A: Clean Energy Alliance Resolution No. 2019-003 (Adopting Implementation Plan) .. 39
May 12, 2020 Item #8 Page 49 of 137
Clean Energy Alliance Implementation Plan
Introduction 4 December 2019
1 INTRODUCTION
The Clean Energy Alliance (“CEA” or “Alliance”), located within San Diego County, is a Joint Powers
Authority (“JPA”) pursuing the implementation of a community choice aggregation program (“CCA” or
“Program”). Founding Member Agencies of CEA include the following three (3) municipalities within the
County of San Diego, which have elected to allow the JPA to provide electric generation service within
their respective jurisdictions:
City of Carlsbad
City of Del Mar
City of Solana Beach
This Implementation Plan and Statement of Intent (“Implementation Plan”) describes CEA’s plans to
implement a voluntary CCA program for electric customers within the jurisdictional boundaries of the
Member Agencies. Electric customers within the Cities of Carlsbad and Del Mar currently take bundled
electric service from San Diego Gas and Electric (“SDG&E”). Electric customers within the City of Solana
Beach currently have the option of taking electric service from Solana Energy Alliance (“SEA”), an existing
Community Choice Aggregation program, or as a bundled customer of SDG&E. The Program will provide
electricity customers the opportunity to jointly procure electricity from competitive suppliers, with such
electricity being delivered over SDG&E’s transmission and distribution system. The planned start date for
the Program is May 1, 2021. All current SDG&E customers within the Del Mar and Carlsbad service area
will receive information describing the CEA Program and will have multiple opportunities to opt out and
choose to remain full requirement (“bundled”) customers of SDG&E, in which case they will not be
enrolled. Current SEA customers will receive information describing the CEA Program and their transition
from SEA to CEA. They will also have multiple opportunities to opt out. Thus, participation in the CEA
Program is completely voluntary. However, as provided by law, customers will be automatically enrolled
according to the anticipated schedule later described in Chapter 5 unless they affirmatively elect to opt-
out. Once, and as long as CEA is operational and all SEA customers have transitioned to CEA, SEA will cease
to be an operational CCA.
Implementation of CEA will enable customers within CEA’s service area to take advantage of the
opportunities granted by Assembly Bill 117 (“AB 117”), the Community Choice Aggregation Law.
CEA’s primary objectives in implementing this Program are to:
1) Procure an electric supply portfolio with higher renewable content than SDG&E;
2) Provide cost competitive electric services when compared to SDG&E;
3) Gain local control in rate setting to provide long-term rate stability for residents and businesses;
4) Meet Climate Action Plan goals of the Member Agencies.
The California Public Utilities Code provides the relevant legal authority for the Alliance to become a
Community Choice Aggregator and invests the California Public Utilities Commission (“CPUC” or
“Commission”) with the responsibility for establishing the cost recovery mechanism that must be in place
before customers can begin receiving electrical service through the CEA Program. The CPUC also has
responsibility for registering the JPA as a Community Choice Aggregator and ensuring compliance with
May 12, 2020 Item #8 Page 50 of 137
Clean Energy Alliance Implementation Plan
Introduction 5 December 2019
basic consumer protection rules. The Public Utilities Code requires adoption of an Implementation Plan
at a duly noticed public hearing. The plan must then be filed with the Commission.
The Alliance is also aware that a CCA Program-specific Renewables Portfolio Standard (“RPS”)
Procurement Plan must be completed and submitted to the CPUC during its CCA registration process –
the Alliance anticipates that the renewable energy targets reflected in this Implementation Plan will meet
or exceed applicable procurement mandates, including prudent planning reserves.
On December 19, 2019, the JPA, at a duly noticed public hearing, adopted this Implementation Plan,
through Resolution No. 2019-003 (a copy of which is included as part of Appendix A).
The Commission has established the methodology to use to determine the cost recovery mechanism, and
SDG&E has approved tariffs for imposition of the cost recovery mechanism. The cities of Del Mar and
Carlsbad have adopted an ordinance to implement a CCA program through its participation in CEA and
Solana Beach adopted its ordinance to implement a CCA program as part of implementing SEA. Each of
the Members has adopted a resolution permitting CEA to provide service within its jurisdiction1. Having
accomplished these milestones, CEA submits this Implementation Plan to the CPUC. Following the CPUC’s
acknowledgement of its receipt of this Implementation Plan and resolution of any outstanding issues, CEA
will submit a draft customer notice, file a draft Renewable Portfolio Standards Procurement Plan, submit
the Financial Security Requirement and execute the Service Agreement with San Diego Gas & Electric as
established in CPUC Resolution E-4907. CEA will take the final steps needed to register as a CCA and
participate in the year-ahead Resource Adequacy (“RA”) process prior to initiating the customer
notification and enrollment process.
1.1 STATEMENT OF INTENT
The content of this Implementation Plan complies with the statutory requirements of AB 117. As required
by Public Utilities Code Section 366.2(c)(3), this Implementation Plan details the process and
consequences of aggregation and provides the Alliance’s statement of intent for implementing a CCA
program that includes all of the following:
Ø Universal access;
Ø Reliability;
Ø Equitable treatment of all customer classes; and
Ø Any requirements established by state law or by the CPUC concerning aggregated service.
1 Copies of individual ordinances adopted by the Clean Energy Alliance’s Members are included within Appendix A
May 12, 2020 Item #8 Page 51 of 137
Clean Energy Alliance Implementation Plan
Introduction 6 December 2019
1.2 ORGANIZATION OF THIS IMPLEMENTATION PLAN
The remainder of this Implementation Plan is organized as follows:
Chapter 2: Aggregation Process
Chapter 3: Organizational Structure
Chapter 4: Startup Plan & Funding
Chapter 5: Program Phase-In
Chapter 6: Load Forecast & Resource Plan
Chapter 7: Financial Plan
Chapter 8: Rate setting
Chapter 9: Customer Rights and Responsibilities
Chapter 10: Procurement Process
Chapter 11: Contingency Plan for Program Termination
Appendix A: Clean Energy Alliance Resolution No. 2019-XXX (Adopting Implementation Plan)
The requirements of AB 117 are cross-referenced to Chapters of this Implementation Plan in the
following table.
May 12, 2020 Item #8 Page 52 of 137
Clean Energy Alliance Implementation Plan
Aggregation Process 7 December 2019
AB 117 Cross References
AB 117 REQUIREMENT IMPLEMENTATION PLAN CHAPTER
Statement of Intent Chapter 1: Introduction
Process and consequences of aggregation Chapter 2: Aggregation Process
Organizational structure of the program, its
operations and funding
Chapter 3: Organizational Structure
Chapter 4: Startup Plan & Funding
Chapter 7: Financial Plan
Disclosure and due process in setting rates and
allocating costs among participants
Chapter 8: Rate setting
Rate setting and other costs to participants Chapter 8: Rate setting
Chapter 9: Customer Rights and
Responsibilities
Participant rights and responsibilities Chapter 9: Customer Rights and
Responsibilities
Methods for entering and terminating
agreements with other entities
Chapter 10: Procurement Process
Description of third parties that will be
supplying electricity under the program,
including information about financial,
technical and operational capabilities
Chapter 10: Procurement Process
Termination of the program Chapter 11: Contingency Plan for Program
Termination
Methods for ensuring procurement from
small, local, and diverse business enterprises
in all categories, including, but not limited to,
renewable energy, energy storage system, and
smart grid projects.
Chapter 6: Load Forecast and Resource Plan
2 AGGREGATION PROCESS
2.1 INTRODUCTION
This Chapter describes the background leading to the development of this Implementation Plan and
describes the process and consequences of aggregation, consistent with the requirements of AB 117.
May 12, 2020 Item #8 Page 53 of 137
Clean Energy Alliance Implementation Plan
Aggregation Process 8 December 2019
In 2017 the cities of Del Mar, Carlsbad and other interested partner agencies engaged the assistance of a
technical consultant to evaluate the feasibility of establishing a CCA program, considering various agency
member formations. The studies revealed that a CCA program was viable, offering customers rates
competitive with SDG&E. Throughout early 2019 the Member Agencies evaluated several different
options related to the provision of CCA services to their service territories. SEA has been a financially
stable CCA since launching in June 2018. The financial model reflected in Section 7, Table 9, demonstrates
that the proposed CEA is a financially viable CCA program.
The CEA was formed with the following objectives: 1) procure a power supply from a minimum 50%
renewable energy sources; 2) help meet the goals of the Member Agency’s Climate Action Plans to reduce
GHG emissions; 3) provide cost-competitive electric services to the customers of CEA; 4) gain local control
of the territory’s energy procurement needs; and 5) provide local clean energy programs and benefits.
The City of Solana Beach (“Solana Beach”) currently operates SEA, the only CCA that is currently serving
customers in SDG&E territory. Solana Beach intends to transition its customers from SEA to CEA during
CEA’s launch month of May 2021. Once its customers are fully transferred to CEA, Solana Beach will no
longer operate SEA. Solana Beach will submit an amended Implementation Plan, concurrent with this CEA
Implementation Plan, that reflects its customers transitioning to CEA.
The Alliance released a draft Implementation Plan in November 2019, which described the planned
organization, governance and operation of the CCA Program. Following consideration of comments
related to the draft document, a final Implementation Plan was prepared and duly adopted by the CEA
Board of Directors.
The CEA Program represents a culmination of planning efforts that are responsive to the expressed needs
and priorities of the residents and business community within the service territory. The Alliance plans to
expand the energy choices available to eligible customers through creation of innovative new programs
for voluntary purchases of renewable energy and net energy metering to promote customer-owned
renewable generation.
2.2 PROCESS OF AGGREGATION
Before they are enrolled in the Program, prospective CEA customers in Carlsbad and Del Mar will receive
two written notices in the mail that will provide information needed to understand the Program’s terms
and conditions of service and explain how customers, if they desire, can opt-out of the Program. All
customers that do not follow the opt-out process specified in the customer notices will be automatically
enrolled, and service will begin at their next regularly scheduled meter read date following the date of
automatic enrollment, subject to the service phase-in plan described in Chapter 5. The initial enrollment
notices will be provided to customers in March 2021, with a second notice being provided in April 2021.
Customers currently being served by SEA were provided the required enrollment notices during their
transition from SDG&E service in 2018. These customers are not subject to the four required notices for
customers leaving SDG&E service, however, they will be provided at least one notice notifying them of
the transition from SEA service to CEA service and any rate or service impacts.
Customers enrolled in the CEA Program will continue to have their electric meters read and to be billed
for electric service by the distribution utility (SDG&E). The electric bill for Program customers will show
May 12, 2020 Item #8 Page 54 of 137
Clean Energy Alliance Implementation Plan
Aggregation Process 9 December 2019
separate charges for generation procured by CEA as well as other charges related to electricity delivery
and other utility charges assessed by SDG&E.
After service cutover, customers will have approximately 60 days (two billing cycles) to opt-out of the CEA
Program without penalty and return to the distribution utility (SDG&E). CEA customers will be advised of
these opportunities via the distribution of two additional enrollment notices provided within the first two
months of service. Customers that opt-out between the initial cutover date and the close of the post
enrollment opt-out period will be responsible for program charges for the time they were served by CEA
but will not otherwise be subject to any penalty for leaving the program. Customers that have not opted-
out within thirty days of the fourth enrollment notice will be deemed to have elected to become a
participant in the CEA Program and to have agreed to the CEA Program’s terms and conditions, including
those pertaining to requests for termination of service, as further described in Chapter 8.
2.3 CONSEQUENCES OF AGGREGATION
2.3.1 Rate Impacts
CEA customers will pay the generation charges set by the Alliance and no longer pay the costs of SDG&E
generation. Customers enrolled in the Program will be subject to the Program’s terms and conditions,
including responsibility for payment of all Program charges as described in Chapter 9.
The Alliance’s rate setting policies described in Chapter 7 establish a goal of providing rates that are
competitive with the projected generation rates offered by the incumbent distribution utility (SDG&E).
The Alliance will establish rates sufficient to recover all costs related to operation of the Program, and the
CEA Board will adopt actual rates.
Initial CEA Program rates will be established following approval of the Alliance’s inaugural program
budget, reflecting final costs from the CEA Program’s energy procurement. The Alliance’s rate policies
and procedures are detailed in Chapter 7. Information regarding final CEA Program rates will be disclosed
along with other terms and conditions of service in the pre-enrollment and post-enrollment notices sent
to potential customers.
Once CEA gives definitive notice to SDG&E that it will commence service, CEA customers will generally not
be responsible for costs associated with SDG&E’s future electricity procurement contracts or power plant
investments. Certain pre-existing generation costs and new generation costs that are deemed to provide
system-wide benefits will continue to be charged by SDG&E to CCA customers through separate rate
components, called the Cost Responsibility Surcharge and the New System Generation Charge. These
charges are shown in SDG&E’s electric service tariffs, which can be accessed from the utility’s website,
and the costs are included in charges paid by both SDG&E bundled customers as well as CCA and Direct
Access customers2. SEA customers that transition to CEA will maintain their current Power Charge
Indifference Adjustment (“PCIA”) vintage of 2017, having already departed from SDG&E generation
services. Eligible Del Mar and Carlsbad customers who transition to CEA service will be assigned a 2020
PCIA vintage.
2 For SDG&E bundled service customers, the Power Charge Indifference Adjustment element of the Cost Responsibility Surcharge
is contained within the CCA-CRS rate tariff.
May 12, 2020 Item #8 Page 55 of 137
Clean Energy Alliance Implementation Plan
Aggregation Process 10 December 2019
2.3.2 Renewable Energy Impacts
A second consequence of the Program will be an increase in the proportion of energy generated and
supplied by RPS-eligible renewable resources. The resource plan includes procurement of renewable
energy in excess of California’s renewable energy procurement mandate, and SDG&E’s forecast
renewable percentage, with a goal of providing a minimum of 50% renewable energy at launch, for all
enrolled customers. Consistent with Senate Bill 100, CEA renewable energy will increase toward 60% by
2030. CEA customers may also voluntarily participate in a higher renewable supply option, potentially up
to 100%. To the extent that customers choose CEA’s voluntary renewable energy option, the renewable
content of CEA’s aggregate supply portfolio will further increase. Initially, requisite renewable energy
supply will be sourced through one or more short-term power purchase agreements; however, shortly
after launching operations, long-term procurement of renewable energy will begin to meet California’s
long-term renewable energy contracting requirements that become effective in Compliance Period 4 and
beyond3. Over time, the Alliance will also consider independent development of new renewable
generation resources.
2.3.3 Greenhouse Gas Reduction
A third consequence of the Program will be an anticipated reduction in the greenhouse gas emissions
attributed to the CEA supply portfolio as compared to SDG&E. An important objective of the CEA
formation is to support the Climate Action Plans of the Member Agencies. Therefore, CEA will set
aggressive GHG-emissions reduction targets and acquire zero or low GHG-emitting supply to achieve
those targets.
3 Under California’s RPS Program, 65 percent of mandated renewable energy purchases must be sourced from eligible long-term
contracts beginning in calendar year 2021.
May 12, 2020 Item #8 Page 56 of 137
Clean Energy Alliance Implementation Plan
Organization and Governance Structure 11 December 2019
3 ORGANIZATION AND GOVERNANCE STRUCTURE
This section provides an overview of the organizational structure of CEA and its proposed implementation
of the CCA program. Specifically, the key agreements, governance, management, and organizational
functions of CEA are outlined and discussed below.
3.1 ORGANIZATIONAL OVERVIEW
CEA is a joint powers authority formed under the California Joint Exercise of Powers Act. It was established
on November 4, 2019 with a Board of Directors serving as its Governing Board. The Board is responsible
for establishing CEA’s Program policies and objectives and overseeing CEA’s operation. In December 2019,
the Board appointed an Interim Chief Executive Officer (“CEO”) to manage the operation of the Alliance
in accordance with policies adopted by the Board.
3.2 GOVERNANCE
The CEA Program will be governed by the CEA Board, which shall include one appointed designee from
each of the Member Agencies. The Members of CEA include three (3) municipalities within the County of
San Diego, Del Mar, Carlsbad and Solana Beach, all of which have elected to allow CEA to provide electric
generation service within their respective jurisdictions. The Alliance’s Board will be comprised of
representatives appointed by each of the Members in accordance with the JPA agreement. The CEA
Program will be operated under the direction of an CEO appointed by the Board, with legal and regulatory
support provided by a Board appointed General Counsel.
The Board’s primary duties are to establish program policies, approve rates and provide policy direction
to the CEO, who has general responsibility for program operations, consistent with the policies established
by the Board. The Board will elect a Chair and Vice Chair and may form various standing and ad hoc
committees, as appropriate, which would have responsibility for evaluating various issues that may affect
the Alliance and its customers, including rate-related and power contracting issues, and would provide
analytical support and recommendations to the Board in these regards.
3.3 MANAGEMENT
The CEA CEO has management responsibilities over the functional areas of Administration & Finance,
Marketing & Public Affairs, Power Resources & Energy Programs, and Government Affairs, as well as the
assisting the Board with overall supervision of the legal services provided by the Alliance’s General
Counsel. In performing the defined obligations to CEA, the CEO may utilize a combination of internal staff
and/or contractors. Certain specialized functions needed for program operations, namely the electric
supply and customer account management functions described below, will be performed by experienced
third-party contractors.
Major functions of the Alliance that will be managed by the CEO are summarized below.
May 12, 2020 Item #8 Page 57 of 137
Clean Energy Alliance Implementation Plan
Organization and Governance Structure 12 December 2019
3.4 ADMINISTRATION
CEA’s CEO will be responsible for managing the organization’s human resources and administrative
functions and will coordinate with the CEA Board, as necessary, with regard to these functions. The
functional area of administration will include oversight of any employee hiring and termination,
compensation and benefits management, identification and procurement of requisite office space and
various other issues. It is likely that existing Member Agency staff will initially assist with this function.
3.5 FINANCE
The CEO is also responsible for managing the financial affairs of the Alliance, including the development
of an annual budget, revenue requirement and rates; managing and maintaining cash flow requirements;
arranging potential bridge loans as necessary; and other financial tools.
Revenues via rates and other funding sources (such as a rate stabilization fund, when necessary) must, at
a minimum, meet the annual budgetary revenue requirement, including recovery of all expenses and any
reserves or coverage requirements set forth in bond covenants or other agreements. The Alliance will
have the flexibility to consider rate adjustments, administer a standardized set of electric rates, and may
offer optional rates to encourage policy goals such as encouraging renewable generation and incentivizing
peak demand reduction, provided that the overall revenue requirement is achieved.
CEA’s finance function will be responsible for preparing the annual budget, arranging financing necessary
for any capital projects, preparing financial reports, managing required audits and ensuring sufficient cash
flow for successful operation of the CEA Program. The finance function will play an important role in risk
management by monitoring the credit of energy suppliers so that credit risk is properly understood and
mitigated. In the event that changes in a supplier’s financial condition and/or credit rating are identified,
the Alliance will be able to take appropriate action, as would be provided for in the electric supply
agreement(s).
3.6 MARKETING & PUBLIC AFFAIRS
The marketing and public affairs functions include general program marketing and communications as
well as direct customer interface ranging from management of key account relationships to call center
and billing operations. The Alliance will conduct program marketing to raise consumer awareness of the
CEA Program and to establish its “brand” in the minds of the public, with the goal of retaining and
attracting as many customers as possible into the CEA Program. Communications will also be directed at
key policy-makers at the state and local level, community business and opinion leaders, and the media.
In addition to general program communications and marketing, a significant focus on customer service,
particularly representation for key accounts, will enhance the Alliance’s ability to differentiate itself as a
highly customer-focused organization that is responsive to the needs of the community. CEA, through its
data services provider, will also establish a customer call center designed to field customer inquiries and
routine interaction with customer accounts.
The customer service function also encompasses management of customer data. Customer data
management services include retail settlements/billing-related activities and management of a customer
database. This function processes customer service requests and administers customer enrollments and
departures from the CEA Program, maintaining a current database of enrolled customers. This function
May 12, 2020 Item #8 Page 58 of 137
Clean Energy Alliance Implementation Plan
Organization and Governance Structure 13 December 2019
coordinates the issuance of monthly bills through SDG&E’s billing process and tracks customer payments.
Activities include the electronic exchange of usage, billing, and payments data with SDG&E and CEA,
tracking of customer payments and accounts receivable, issuance of late payment and/or service
termination notices (which would return affected customers to bundled service), and administration of
customer deposits in accordance with credit policies of the Alliance.
The customer data management services function also manages billing-related communications with
customers, customer call centers, and routine customer notices. The Alliance will contract with an
experienced third party to perform the customer account and billing services functions.
3.7 POWER RESOURCES & ENERGY PROGRAMS
CEA must plan for meeting the electricity needs of its customers utilizing resources consistent with its
policy goals and objectives as well as applicable legislative and/or regulatory mandates. CEA’s long-term
resource plans (addressing the 10-20-year planning horizon) will comply with California Law and other
pertinent requirements of California regulatory bodies. In particular, CEA is aware of compulsory
Integrated Resource Planning requirements, as identified in Senate Bill 350 (de Léon, 2015), which require,
among other provisions, that CCAs periodically submit integrated resource planning documents and
related materials to the CPUC. Specifically, the Public Utilities Code requires that, “The plan of a
community choice aggregator shall be submitted to its governing board for approval and provided to the
commission for certification, consistent with paragraph (5) of subdivision (a) of section 366.2”. The
Alliance intends to comply with this requirement similar to the manner in which other CCA organizations
have complied and will rely on the experience gained by such organizations in completing pertinent data
templates and documentation during future processes. Integrated resource planning efforts of the
Alliance will make use of demand side energy efficiency, distributed generation and demand response
programs as well as traditional supply options, which rely on structured wholesale transactions to meet
customer energy requirements. Integrated resource plans will be updated and adopted by the Board as
required by state law and applicable regulations. The Alliance is also aware of the need to periodically
prepare and submit RPS Procurement Plans, which shall address the manner in which the CEA Program
will achieve compliance with pertinent provisions of California’s RPS mandate. As required, the first RPS
Procurement Plans will be developed and submitted during the 90-day certification period related to this
Implementation Plan.
The Alliance may develop and administer complementary energy programs that may be offered to CEA
customers, including green pricing, energy efficiency, net energy metering and various other programs
that may be identified to support the overarching goals and objectives of the Alliance.
3.7.1 Electric Supply Operations
Electric supply operations encompass the activities necessary for wholesale procurement of electricity to
serve end use customers. These highly specialized activities include the following:
Ø Electricity Procurement – assemble a portfolio of electricity resources to supply the electric needs
of Program customers.
Ø Risk Management – application of standard industry techniques to reduce exposure to the
volatility of energy and credit markets and insulate customer rates from sudden changes in
wholesale market prices.
May 12, 2020 Item #8 Page 59 of 137
Clean Energy Alliance Implementation Plan
Organization and Governance Structure 14 December 2019
Ø Load Forecasting – develop load forecasts, both long-term for resource planning, short-term for
the electricity purchases, and sales needed to maintain a balance between hourly resources and
loads.
Ø Scheduling Coordination – scheduling and settling electric supply transactions with the California
Independent System Operator (“CAISO”).
The Alliance will contract with one or more experienced and financially sound third-party energy services
firms to perform most of the electric supply operations for the CEA Program. These requirements include
the procurement of energy, capacity and ancillary services, scheduling coordinator services, short-term
load forecasting and day-ahead and real-time electricity trading.
3.8 GOVERNMENTAL AFFAIRS & LEGAL SUPPORT
The CEA Program will require ongoing regulatory and legislative representation to manage various
regulatory compliance filings related to resource plans, RA, compliance with California’s RPS program and
overall representation on issues that will impact CEA customers. The Alliance will maintain an active role
at the CPUC, the California Energy Commission, the California Independent System Operator (“CAISO”),
the California legislature and, as necessary, the Federal Energy Regulatory Commission with either in-
house staff or contracted third parties with experience in the energy market arena.
CEA’s General Counsel is hired by and reports to the Board of Directors. However, the CEO will assist the
Board in supervising the legal services as provided by General Counsel. The Alliance may retain specialized
outside legal services, as necessary, to review power purchase agreements, give advice on regulatory
matters, and provide other specialized legal services related to activities of the CEA Program. In addition,
CEA’s wholesale services provider may assist with regulatory filings related to wholesale procurement.
May 12, 2020 Item #8 Page 60 of 137
Clean Energy Alliance Implementation Plan
Startup Plan and Funding 15 December 2019
4 STARTUP PLAN AND FUNDING
This Chapter presents the Alliance’s plans for the start-up period, including necessary expenses and capital
outlays. As described in the previous Chapter, the Alliance will utilize a mix of internal staff and
contractors in its CCA Program implementation and operation.
4.1 STARTUP ACTIVITIES
The initial program startup activities include the following:
Ø Hire staff and/or contractors to manage implementation
Ø Adopt policies and procedures for the operation of CEA
Ø Identify qualified suppliers (of requisite energy products and related services) and negotiate
supplier contracts
• Electric supplier and scheduling coordinator
• Data management provider (if separate from energy supply)
Ø Define and execute communications plan
• Customer research/information gathering
• Media campaign
• Key customer/stakeholder outreach
• Informational materials and customer notices
• Customer call center
• Website
Ø Post financial security requirement and complete requisite registration requirements
Ø Establish reserves that may be required by energy suppliers
Ø Pay utility service initiation, notification and switching fees
Ø Perform customer notification, opt-out and transfers
Ø Conduct load forecasting
Ø Establish rates
Ø Legal and regulatory support
Ø Financial management and reporting
Some costs related to starting up the CEA Program may be the responsibility of the CEA Program’s
contractors. These may include capital requirements needed for collateral/credit support for electric
May 12, 2020 Item #8 Page 61 of 137
Clean Energy Alliance Implementation Plan
Startup Plan and Funding 16 December 2019
supply expenses, customer information system costs, bond requirements, electronic data exchange
system costs, call center costs, and billing administration/settlements systems costs.
4.2 STAFFING AND CONTRACT SERVICES
Personnel in the form of Alliance staff, Member Agency staff, or contractors will be utilized as needed to
match workloads involved in forming CEA, managing contracts, and initiating customer
outreach/marketing during the pre-operations period. During the startup period, minimal personnel
requirements may include a CEO, legal support, and other personnel needed to support regulatory,
procurement, finance, legal, marketing, and communications activities. This support will come from
existing Member Agency staff and contractors. Once operational, additional staff and/or contractors may
be retained, as needed, to support the rollout of additional value-added services (e.g., efficiency projects)
and local generation projects and programs.
4.3 CAPITAL REQUIREMENTS
The start-up of the CCA Program will require capital for three major functions: (1) staffing and contractor
costs; (2) deposits and reserves; and (3) operating cash flow. Based on the Alliance’s anticipated start-up
activities and implementation schedule, a total need of $4.4M has been identified to support the
aforementioned functions. Out of the $4.4 capital requirements, $450,000 will be funded from member
advances for costs incurred in fiscal year 19/20, $959,000 is related to the implementation/startup efforts
(i.e., rate setting, power procurement and contract negotiations, marketing and communications,
regulatory compliance, SDG&E security deposit, etc.) in order to serve customers by May 2021. A deposit
in the amount of $500,000 will also need to be posted to CAISO for the Alliance to be a Congestion
Revenue Rights Holder. The remaining $2,500,000 is the “float” required for CEA to pay its monthly bills
before the program generates enough internal cash to self-fund its working capital needs.
The capital requirement is further broken down as follows:
FY 19/20 FY 20/21
Staffing/Consultants 50,000.00$ 235,000.00$
Legal Services 130,000.00 200,000.00
Professional Services 115,000.00 200,000.00
CCA Bond 147,000.00
CAISO Fee 500,000.00
CalCCA Membership & Dues 1,500.00 130,000.00
Print/Mail Services 132,000.00
Advertising 10,000.00
Graphic Design Services 6,500.00 10,000.00
Website Maintenance 2,500.00
Audit Services 40,000.00
Cash Flow & Lockbox Reserves 2,500,000.00
TOTAL PROJECTED BUDGET 450,000.00$ 3,959,500.00$
Clean Energy Alliance
Draft Budget
Fiscal Years 19/20 and 20/21
May 12, 2020 Item #8 Page 62 of 137
Clean Energy Alliance Implementation Plan
Startup Plan and Funding 17 December 2019
The finance plan in Chapter 7 provides additional detail regarding the Alliance’s expected capital
requirements and general Program finances. All the capital required for start-up will be provided through
in-kind support from Member Agencies, deferred fees, Member advances and direct loans.
Related to the Alliance’s initial capital requirement, this amount is expected to cover staffing and
contractor costs during startup and pre-startup activities, including direct costs related to public relations
support, technical support, and customer communications. Requisite deposits and operating reserves are
also reflected in the initial capital requirement, including the following items: 1) operating reserves to
address anticipated cash flow variations; 2) deposit with the CAISO prior to commencing market
operations (if required); 3) Financial Security Requirement (CCA bond posted with the CPUC); and 4)
SDG&E service fee deposit, if required.
Operating revenues from sales of electricity will be remitted to CEA beginning approximately sixty days
after the initial customer enrollments. This lag is due to the distribution utility’s standard meter reading
cycle of 30 days and a 30-day payment/collections cycle. CEA will need working capital to support
electricity procurement and costs related to program management, which is included in CEA’s initial
$4,400,000 capital requirement.
4.4 FINANCING PLAN
CEA’s initial capital requirement will be met through a combination of financing mechanisms. CEA will be
seeking assistance through deferred fees from contractors and vendors, loans and/or lines of credit from
financial institutions and in-kind services and advances provided by Member Agencies (to be reimbursed
in the future). CEA will repay back the principal and interest costs associated with the start-up funding
via retail generation rates charged to CEA customers. It is anticipated that the start-up costs will be fully
recovered through such customer generation rates within the first three years of operations.
May 12, 2020 Item #8 Page 63 of 137
Clean Energy Alliance Implementation Plan
Program Phase-In 18 December 2019
5 PROGRAM PHASE-IN
CEA plans to roll out its service offering to all eligible customers in a single phase at start-up. There are
approximately 58,000 eligible customer accounts within the Alliance’s boundaries, resulting in a single-
phase roll-out being reasonable and the most efficient way for CEA to serve customers beginning in May
2021.
Solana Beach is currently providing energy to its residents and businesses through SEA, its community
choice aggregation program. During May 2021, SEA customers will transfer from SEA to CEA. Once, and
as long as CEA is operational and all SEA customers have transitioned to CEA, SEA will cease operating as
a community choice aggregation program.
It is possible that Net Energy Metering (“NEM”) customers may be enrolled over multiple periods to
mitigate the impact of SDG&E NEM true-up treatment.
May 12, 2020 Item #8 Page 64 of 137
Clean Energy Alliance Implementation Plan
Load Forecast & Resource Plan 19 December 2019
6 LOAD FORECAST & RESOURCE PLAN
6.1 INTRODUCTION
This Chapter describes the planned mix of electric resources that will meet the energy demands of CEA
customers using a diversified portfolio of electricity supplies. Several overarching policies govern the
resource plan and the ensuing resource procurement activities that will be conducted in accordance with
the plan. The key policies are as follows:
• Develop a portfolio with a minimum 50% renewable energy and lower greenhouse gas (“GHG”)
emissions than SDG&E.
• Manage a diverse resource portfolio to increase control over energy costs and maintain competitive
and stable electric rates.
• Comply with RA procurement requirements as established by CPUC Resolution E-4907.
• Comply with applicable renewable energy procurement mandates, as increased under Senate Bill 100
(“SB 100”; de Léon, 2018).
• Comply with SB 350, periodically preparing and submitting (for certification by the CPUC) an
Integrated Resource Plan (“IRP”).
• Comply with applicable requirements for ensuring procurement from small, local and diverse business
enterprises in all categories, including, but not limited to, renewable energy, energy storage system,
and smart grid projects as required by SB 255 (“SB 255”; Bradford, 2019).
• As applicable, annually prepare and submit a detailed and verifiable plan to the CPUC for increasing
procurement from small, local and diverse business enterprises in all categories, including, but not
limited to, renewable energy, energy storage system, and smart grid projects as required by SB 255.
• As applicable, annually prepare and submit a report to the CPUC regarding its procurement from
women, minority, disabled veteran and LGBTQ business enterprises in all categories, including, but
not limited to, renewable energy, energy storage system, and smart grid projects as required by SB
255.
The plan described in this section would accomplish the following:
Ø Procure Competitive Supply: Procure energy, RA, renewables and low-GHG supply through
competitive processes in the open market to support the potential offering of service options to
include a 100% renewable energy voluntary opt-up product.
Ø Use Best Practices Risk Management: Maintain rate competitiveness by using a dollar-cost-
averaging approach with particular attention to the methodology used in the power charge
indifference adjustment (“PCIA”) calculation. Use stochastic modeling to measure and achieve
risk management objectives.
Ø Achieve Environmental Objectives: Procure supply to offer two distinct generation rate tariffs: 1)
a voluntary 100% renewable energy offered to CEA customers on a price premium basis relative
May 12, 2020 Item #8 Page 65 of 137
Clean Energy Alliance Implementation Plan
Load Forecast & Resource Plan 20 December 2019
to CEA’s default retail option; and 2) a default CEA service option that is sourced from a minimum
50% renewable energy.
Ø Provide NEM Tariff: Encourage distributed renewable generation in the local area through the
offering of a net energy metering tariff that is more remunerative than SDG&E’s NEM tariff.
Ø Compliance: Ensure compliance with participation in the Annual and Monthly RA process.
Ø Diversity: Encourage procurement from small, local and diverse business enterprises.
CEA will comply with regulatory rules applicable to California load serving entities. CEA will arrange for
the scheduling of sufficient electric supplies to meet the demands of its customers. CEA will adhere to
capacity reserve requirements established by the CPUC and the CAISO designed to address uncertainty in
load forecasts and potential supply disruptions caused by generator outages and/or transmission
contingencies. These rules also ensure that physical generation capacity is in place to serve CEA’s
customers, even if there were a need for the Alliance’s Program to cease operations and return customers
to SDG&E. In addition, the Alliance will be responsible for ensuring that its resource mix contains sufficient
production from renewable energy resources needed to comply with the statewide RPS mandate (33
percent renewable energy by 2020, increasing to 60 percent by 2030). The resource plan will meet or
exceed all of the applicable regulatory requirements related to RA and the RPS.
In relation to its RPS procurement obligation, CEA is aware that SB 100 was signed into law by Governor
Brown on September 10, 2018, with an effective date of January 1, 2019. One of SB 100’s key
requirements is to increase California’s RPS procurement mandate to 44 percent by December 31, 2024,
52 percent by December 31, 2027, and 60 percent by December 31, 2030. The Alliance is also aware of
applicable long-term renewable energy contracting requirements and plans to satisfy such requirements
with one or more eligible contracts put in place prior to or during early-stage operation of the CCA
Program. As a local governmental agency, the Alliance’s resource planning and procurement activities
are subject to and overseen by its Board through an open and public process.
In relation to its small, local and diverse business enterprise procurement requirement, the Alliance is
aware that SB 255 was signed into law by Governor Newsom on October 2, 2019. SB 255 requires the CEA
Implementation Plan that to include the methods for ensuring procurement from small, local and diverse
business enterprises in all categories, including, but not limited to, renewable energy, energy storage
system, and smart grid projects. These methods are described in the Small, Local and Diverse Business
Enterprise Procurement section.
6.2 RESOURCE PLAN OVERVIEW
To meet the aforementioned objectives and satisfy the applicable regulatory requirements pertaining to
CEA’s status as a California load serving entity, CEA’s resource plan includes a diverse mix of power
purchases, renewable energy, and potentially, new energy efficiency programs, demand response, and
distributed generation. A diversified resource plan minimizes risk and volatility that can occur from over-
reliance on a single resource type or fuel source, and thus increases the likelihood of rate stability. The
planned power supply will initially be comprised of power purchases from third party electric suppliers
and, in the longer-term, may include renewable generation assets owned and/or controlled by CEA.
May 12, 2020 Item #8 Page 66 of 137
Clean Energy Alliance Implementation Plan
Load Forecast & Resource Plan 21 December 2019
Once the CEA Program demonstrates it can operate successfully, CEA may begin evaluating opportunities
for investment in renewable generating assets, subject to then-current market conditions, statutory
requirements and regulatory considerations. Any renewable generation owned by CEA or controlled
under a long-term power purchase agreement with a proven public power developer, could provide a
portion of CEA’s electricity requirements on a cost-of-service basis. Depending upon market conditions
and, importantly, the applicability of tax incentives for renewable energy development, electricity
purchased under a cost-of-service arrangement can be more cost-effective than purchasing renewable
energy from third party developers, which will allow the CEA Program to pass on cost savings to its
customers through competitive generation rates. Any investment decisions in new renewable generating
assets will be made following appropriate environmental reviews and in consultation with qualified
financial and legal advisors.
As an alternative to direct investment, CEA may consider partnering with an experienced public power
developer or other Joint Powers Authorities and could enter into a long-term (15-to-30 year) power
purchase agreement that would support the development of new renewable generating capacity. Such
an arrangement could be structured to reduce the CEA Program’s operational risk associated with capacity
ownership while providing its customers with all renewable energy generated by the facility under
contract.
CEA’s indicative resource plan for the years 2021 through 2030 is summarized in the following table. Note
that CEA’s projections reflect a portfolio mix of renewable energy compliant with the annual RPS
requirement and all other supply coming in the form of conventional resources or CAISO system power4.
Table 1: Proposed Resource Plan
6.3 SUPPLY REQUIREMENTS
The starting point for CEA’s resource plan is a projection of participating customers and associated electric
consumption. Projected electric consumption is evaluated on an hourly basis and matched with resources
best suited to serving the aggregate of hourly demands or the program’s “load profile.” The electric sales
forecast and load profile will be affected by CEA’s plan to introduce the CEA Program to customers in one
4 The Alliance has applied known RPS procurement targets, as reflected in SB 100, for calendar years 2024, 2027 and 2030. In the
intervening years, the Alliance has assumed a general straight-line trajectory between each of the aforementioned years (which
are associated with the final years of Compliance Periods 4, 5 and 6 respectively).
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Demand (MWh)Retail 144,022 928,654 949,406 965,616 980,219 990,867 997,196 1,017,140 1,037,482 1,058,232
Losses 6,193 39,932 40,824 41,521 42,149 42,607 42,879 43,737 44,612 45,504
Wholesale 150,215 968,586 990,230 1,007,137 1,022,368 1,033,474 1,040,075 1,060,877 1,082,094 1,103,736
Supply (MWh)
Renewable 72,011 464,327 474,703 482,808 490,109 495,433 518,542 556,036 594,823 634,939
System 78,204 504,259 515,527 524,329 532,259 538,041 521,533 504,840 487,271 468,797 Total Supply 150,215 968,586 990,230 1,007,137 1,022,368 1,033,474 1,040,075 1,060,877 1,082,094 1,103,736
Clean Energy Alliance
Proposed Resource Plan (MWh)
2021 - 2030
May 12, 2020 Item #8 Page 67 of 137
Clean Energy Alliance Implementation Plan
Load Forecast & Resource Plan 22 December 2019
single phase and the degree to which customers choose to remain with SDG&E during the customer
enrollment and opt-out period. The Alliance’s rollout plan and assumptions regarding customer
participation rates are discussed below.
6.4 CUSTOMER PARTICIPATION RATES
Customers will be automatically enrolled in the CEA Program unless they opt-out during the customer
notification process conducted during the 60-day period prior to enrollment and continuing through the
60-day period following commencement of service. The Alliance anticipates an overall customer
participation rate of approximately 90 percent of eligible SDG&E bundled service customers, based on
reported opt-out rates for already operating CCAs. It is assumed that customers taking direct access
service from a competitive electricity provider will continue to remain with their current supplier.
The participation rate is not expected to vary significantly among customer classes, in part because the
Alliance will offer two distinct rate tariffs that will address the needs of cost-sensitive customers as well
as the needs of both residential and business customers that prefer a highly renewable energy product.
The assumed participation rates will be refined as CEA’s public outreach and market research efforts
continue to develop.
6.5 CUSTOMER FORECAST
Once customers enroll, they will be transferred to service by CEA on their regularly scheduled meter read
date over an approximately thirty-one-day period. Approximately 2,900 service accounts per day will be
transferred during the first month of service. The number of accounts anticipated to be served by CEA at
the end of the enrollment period is shown in Table 2.
Table 2: Total Customer Counts at the end of First Month of Operation, here presuming enrollment occurs in May 2021.
The Alliance assumes that customer growth will generally offset customer attrition (opt-outs) over time,
resulting in a relatively stable customer base (<1% annual growth) over the noted planning horizon. While
the successful operating track record of California CCA programs continues to grow, there is a relatively
short history with regard to CCA operations, which makes it difficult to anticipate the actual levels of
customer participation within the CEA Program. The Alliance believes that its assumptions regarding the
offsetting effects of growth and attrition are reasonable in consideration of the historical customer growth
(based on SDG&E data) within the JPA and the potential for continuing customer opt-outs following
mandatory customer notification periods. The following table shows the forecast of service accounts
(customers) served by CEA for each of the next ten years.
Table 3: Customer Accounts by Year
May-21
Residential 49,800
Commercial & Agriculture 8,000
Street Lighting & Traffic 200
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030Residential49,800 49,800 49,900 49,900 50,000 50,100 50,100 51,100 52,200 53,200
Commercial & Agriculture 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,200 8,400 8,500
Street Lighting & Traffic 200 200 200 200 200 200 200 200 200 200
May 12, 2020 Item #8 Page 68 of 137
Clean Energy Alliance Implementation Plan
Load Forecast & Resource Plan 23 December 2019
6.6 SALES FORECAST
The Alliance’s forecast reflects the rollout and customer enrollment schedule shown above.
Annual energy requirements are shown in Table 4.
Table 4: Demand Forecast in MWh, 2021-2030
6.7 CAPACITY REQUIREMENTS
The CPUC’s RA standards applicable to the CEA Program require a demonstration one year in advance that
CEA has secured physical capacity for 90 percent of its projected peak loads for each of the five months
May through September, plus a minimum 15 percent reserve margin.
Additionally, the Alliance must demonstrate one year in advance that it has secured physical capacity for
100 percent of its local RA obligation across all months in the upcoming compliance year 2021 and the
following compliance year 2022 and 50 percent across all months in 2023. On a month-ahead basis, CEA
must demonstrate 100 percent of the peak load plus a minimum 15 percent reserve margin. Per CPUC
Resolution E-4907, the Alliance must participate in the year-ahead RA compliance cycle in order to serve
customers in the following calendar year. The Alliance will follow the prescribed year-ahead RA
compliance timeline outlined within Appendix A of Resolution E-4907; this includes:
• Submission of year-ahead load forecast to the CEC and CPUC in April 2020;
• Submission of updated year-ahead load forecast to the CEC and CPUC in August 2020;
• Submission of year-ahead compliance materials in October 2020; and
• Submission of month-ahead load migration forecast by February 2021.
A portion of CEA’s capacity requirements must be procured locally, from the San Diego – Imperial Valley
local capacity area as defined by the CAISO. The Alliance would be required to demonstrate its local
capacity requirement for each month of the following calendar year. The local capacity requirement is a
percentage of the total (SDG&E service area) local capacity requirements adopted by the CPUC based on
CEA’s forecasted peak load. CEA must demonstrate compliance or request a waiver from the CPUC
requirement as provided for in cases where local capacity is not available.
CEA is also required to demonstrate that a specified portion of its capacity meets certain operational
flexibility requirements under the CPUC and CAISO’s flexible RA framework.
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Demand (MWh)
Retail 144,022 928,654 949,406 965,616 980,219 990,867 997,196 1,017,140 1,037,482 1,058,232
Losses 6,193 39,932 40,824 41,521 42,149 42,607 42,879 43,737 44,612 45,504 Wholesale 150,215 968,586 990,230 1,007,137 1,022,368 1,033,474 1,040,075 1,060,877 1,082,094 1,103,736
May 12, 2020 Item #8 Page 69 of 137
Clean Energy Alliance Implementation Plan
Load Forecast & Resource Plan 24 December 2019
The estimated forward RA requirements for 2021 through 2023 are shown in the following tables5:
Table 5: Forward Capacity Requirements (Total) for 2021-2023 in MW, presuming service starts in May 2021
CEA’s plan ensures that sufficient reserves will be procured to meet its peak load at all times. The
projected CEA annual capacity requirements are shown in the following table:
Table 6: Annual Maximum Capacity Requirements 2021-2030
Local capacity requirements are a function of the SDG&E area RA requirements and CEA’s projected peak
demand. CEA will need to work with the CPUC’s Energy Division and staff at the California Energy
Commission to obtain the data necessary to calculate its monthly local capacity requirement. A
preliminary estimate of CEA’s annual maximum local capacity requirement for the ten-year planning
period ranges between 132-155 MW as shown in Table 7.
Table 7: Annual Maximum Local Capacity Requirements 2021-2030
The CPUC assigns local capacity requirements during the year prior to the compliance period; thereafter,
the CPUC provides local capacity requirement true-ups for the second half of each compliance year.
CEA will coordinate with SDG&E and appropriate state agencies to manage the transition of responsibility
for RA from SDG&E to CEA during CCA program phase-in. For system RA requirements, CEA will make
month-ahead showings for each month that CEA plans to serve load, and load migration issues would be
addressed through the CPUC’s approved procedures. CEA will work with the California Energy
5 The figures shown in the tables are estimates. CEA’s RA requirements will be subject to modification due to application of
certain coincidence adjustments and resource allocations relating to utility demand response and energy efficiency programs, as
well as generation capacity allocated through the Cost Allocation Mechanism. These adjustments are addressed through the
CPUC’s RA compliance process.
May 12, 2020 Item #8 Page 70 of 137
Clean Energy Alliance Implementation Plan
Load Forecast & Resource Plan 25 December 2019
Commission and CPUC prior to commencing service to customers to ensure it meets its local and system
RA obligations through its agreement(s) with its chosen electric supplier(s).
6.8 RENEWABLES PORTFOLIO STANDARDS ENERGY REQUIREMENTS
6.8.1 Basic RPS Requirements
CEA will be required by statute and CPUC regulations to procure a certain minimum percentage of its retail
electricity sales from qualified renewable energy resources. For purposes of determining CEA’s renewable
energy requirements, many of the same standards for RPS compliance that are applicable to the
distribution utilities will apply to CEA.
California’s RPS program is currently undergoing reform. On October 7, 2015, Governor Brown signed
Senate Bill 350 (“SB 350”; De Leon and Leno), the Clean Energy and Pollution Reduction Act of 2015, which
increased California’s RPS procurement target from 33 percent by 2020 to 50 percent by 2030 amongst
other clean-energy initiatives. The RPS program was further amended on September 10, 2018 when
Governor Brown signed SB 100, increasing California’s RPS procurement target to 60 percent by 2030
amongst other clean-energy initiatives. Many details related to SB 100 implementation will be developed
over time with oversight by designated regulatory agencies. However, it is reasonable to assume that
interim annual renewable energy procurement targets will be imposed on CCAs and other retail electricity
sellers to facilitate progress towards the 60 percent procurement mandate. For planning purposes, CEA
has assumed straight-line annual increases (1.7 percent per year) to the RPS procurement target
beginning in 2021, as the state advances on the 60 percent RPS in 2030. CEA will also adopt an integrated
resource plan in compliance with SB 350. Furthermore, the Alliance will ensure that all long-term
renewable energy contracting requirements, as imposed by SB 350, will be satisfied through appropriate
transactions with qualified suppliers and will also reflect this intent in ongoing resource planning and
procurement efforts.
6.8.2 CEA’s Renewables Portfolio Standards Requirement
CEA’s annual RPS procurement requirements, as specified under California’s RPS program, are shown in
Table 8.
Table 8: Renewable Procurement Obligation and Target Percentages and Volumes 2021-2030
6.9 PURCHASED POWER
Power purchased from power marketers, public agencies, generators, and/or utilities will be a significant
source of supply during the first several years of CEA Program operation. CEA will initially contract to
obtain all of its electricity from one or more third party electric providers under one or more power supply
agreements, and the supplier(s) will be responsible for procuring the specified resource mix, including
CEA’s desired quantities of renewable energy, to provide a stable and cost-effective resource portfolio for
the CEA Program.
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030Retail Load (MWh)144,022 928,654 949,406 965,616 980,219 990,867 997,196 1,017,140 1,037,482 1,058,232
RPS % Target 36% 39% 41% 44% 47% 49% 52%55%57%60%
RPS Obligation (MWh)51,560 357,532 392,105 424,871 457,762 488,497 518,542 556,036 594,823 634,939 CEA % Target 50% 50% 50% 50% 50% 50% 52%55%57%60%
CEA Target (MWh)72,011 464,327 474,703 482,808 490,109 495,433 518,542 556,036 594,823 634,939
May 12, 2020 Item #8 Page 71 of 137
Clean Energy Alliance Implementation Plan
Load Forecast & Resource Plan 26 December 2019
6.10 RENEWABLE RESOURCES
CEA will initially secure necessary renewable power supply from its third-party electric supplier(s). CEA
may supplement the renewable energy provided under the initial power supply contract(s) with direct
purchases of renewable energy from renewable energy facilities or from renewable generation developed
and owned by CEA. At this point in time, it is not possible to predict what projects might be proposed in
response to future renewable energy solicitations administered by CEA, unsolicited proposals or
discussions with other agencies. Renewable projects that are located virtually anywhere in the Western
Interconnection can be considered as long as the electricity is deliverable to the CAISO control area, as
required to meet the Commission’s RPS rules and any additional guidelines ultimately adopted by the
Alliance. The costs of transmission access and the risk of transmission congestion costs would need to be
considered in the bid evaluation process if the delivery point is outside of CEA’s load zone, as defined by
the CAISO.
6.11 SMALL, LOCAL AND DIVERSE BUSINESS ENTERPRISE PROCUREMENT
CEA’s procurement processes will be developed to ensure compliance with SB 255 regarding procurement
from small, local and diverse business enterprises as applicable. These methods may include, but are not
limited to, providing preferences to small, local and diverse business enterprises as permitted by law,
developing specifications that encourage responses by small, local and diverse business enterprises,
conducting outreach to these enterprises and other methods as may be directed by the CEA Board. CEA
will request from contractors and information related to the hiring of small, local and diverse business
enterprises that will be reported to commission.
6.12 ENERGY EFFICIENCY
CEA does not currently anticipate running locally managed energy efficiency programs. In the future, CEA
may apply to become EE program administrators. In the meantime, CEA will support already existing
energy efficiency efforts within its service territory.
May 12, 2020 Item #8 Page 72 of 137
Clean Energy Alliance Implementation Plan
Financial Plan 27 December 2019
7 FINANCIAL PLAN
This Chapter examines the monthly cash flows expected during the startup and customer phase-in period
of the CEA Program and identifies the anticipated financing requirements. It includes estimates of
program startup costs, including necessary expenses and capital outlays. It also describes the
requirements for working capital and long-term financing for the potential investment in renewable
generation, consistent with the resource plan contained in Chapter 6.
7.1 DESCRIPTION OF CASH FLOW ANALYSIS
The Alliance’s cash flow analysis estimates the level of capital that will be required during the startup and
phase-in period. The analysis focuses on the CEA Program’s monthly costs and revenues and the lags
between when costs are incurred and revenues received.
7.2 COST OF PROGRAM OPERATIONS
The first category of the cash flow analysis is the Cost of CCA Program Operations. To estimate the overall
costs associated with CCA Program Operations, the following components were taken into consideration:
Ø Electricity Procurement;
Ø Ancillary Service Requirements;
Ø Exit Fees;
Ø Staffing and Professional Services;
Ø Data Management Costs;
Ø Administrative Overhead;
Ø Billing Costs;
Ø Scheduling Coordination;
Ø Grid Management and other CAISO Charges;
Ø CCA Bond and Security Deposit; and,
Ø Pre-Startup Cost Reimbursement.
7.3 REVENUES FROM CCA PROGRAM OPERATIONS
The cash flow analysis also provides estimates for revenues generated from CCA operations or from
electricity sales to customers. In determining the level of revenues, the analysis assumes the customer
phase-in schedule described herein, and assumes that CEA charges a standard, default electricity tariff
similar to the generation rates of SDG&E for each customer class and an optional renewable energy tariff
(with a renewable energy content that exceeds the CEA default retail option) at a premium reflective of
incremental renewable power costs. More detail on CEA Program rates can be found in Chapter 8.
May 12, 2020 Item #8 Page 73 of 137
Clean Energy Alliance Implementation Plan
Financial Plan 28 December 2019
7.4 CASH FLOW ANALYSIS RESULTS
The results of the cash flow analysis provide an estimate of the level of capital required for the Alliance to
move through the CCA startup and phase-in periods. This estimated level of capital is determined by
examining the monthly cumulative net cash flows (revenues from CCA operations minus cost of CCA
operations) based on assumptions for payment of costs or other cash requirements (e.g., deposits) by
CEA, along with estimates for when customer payments will be received. This identifies, on a monthly
basis, what level of cash flow is available in terms of a surplus or deficit.
The cash flow analysis identifies funding requirements in recognition of the potential lag between
revenues received and payments made during the phase-in period. The estimated financing requirements
for the startup and phase-in period, including working capital needs associated with the customer
enrollments, is determined to be $4.4M. Of the $4.4M in capital requirements, $1.4 is related to the
implementation/startup efforts, to be incurred during fiscal years 19/20 and 20/21, (i.e., rate setting,
power procurement and contract negotiations, marketing and communications, regulatory compliance,
CPUC bond, SDG&E security deposit, etc.) in order to serve customers by May 2021. A deposit in the
amount of $500,000 will also need to be posted to CAISO for the Alliance to be a Congestion Revenue
Rights Holder. The other $2,500,000 is the “float” required for CEA to pay its monthly bills before the
program generates enough internal cash to self-fund its working capital needs. Working capital
requirements peak soon after enrollment of all CEA customers.
7.5 PROGRAM IMPLEMENTATION PRO FORMA
In addition to developing a cash flow analysis that estimates the level of working capital required to move
CEA through full CCA phase-in, a summary pro forma analysis that evaluates the financial performance of
the CCA program during the phase-in period is shown in Table 9. The difference between the cash flow
analysis and the CCA pro forma analysis is that the pro forma analysis does not include a lag associated
with payment streams. In essence, costs and revenues are reflected in the month in which service is
provided. All other items, such as costs associated with CCA Program operations and rates charged to
customers remain the same. Cash provided by financing activities are not shown in the pro forma analysis,
although payments for loan repayments are included as a cost item.
The results of the pro forma analysis are shown in Table 9. In particular, the summary of CCA program
startup and phase-in addresses projected CEA Program operations for the period beginning May 2021
through June 2030. The Alliance has also included a summary of Program reserves, which are expected to
accrue over this same period.
Table 9: Pro Forma including Reserves Accumulation 2021-2030
May 12, 2020 Item #8 Page 74 of 137
Clean Energy Alliance Implementation Plan
Financial Plan 29 December 2019
The surpluses achieved during the phase-in period serve to build CEA’s net financial position and credit
profile and to provide operating reserves for CEA in the event that operating costs (such as power
purchase costs) exceed collected revenues for short periods of time.
7.6 CLEAN ENERGY ALLIANCE FINANCINGS
It is anticipated that CEA will need financing for its start-up activities. CEA plans to seek financing through
its service providers that will amortize their start-up costs over the subsequent months following when
revenues begin flowing, through a loan or line of credit from a financial institution and through in-kind
services and advances from its Member Agencies that will be repaid in the future. Subsequent capital
requirements will be self-funded from accrued CEA financial reserves.
7.7 RENEWABLE RESOURCE PROJECT FINANCING
CEA may consider project financings for renewable resources, likely local wind and solar projects. These
financings would only occur after a sustained period of successful CEA Program operation and after
appropriate project opportunities are identified and subjected to appropriate environmental review.
In the event that such financing occurs, funds would include any short-term financing for the renewable
resource project development costs and would likely extend over a 20 to 30-year term. The security for
such bonds would be the revenue from sales to the retail customers of CEA.
May 12, 2020 Item #8 Page 75 of 137
Clean Energy Alliance Implementation Plan
Rate Setting, Program Terms and Conditions 30 December 2019
8 RATE SETTING, PROGRAM TERMS AND CONDITIONS
8.1 INTRODUCTION
This Chapter describes the initial policies proposed for CEA in setting its rates for electric aggregation
services. These include policies regarding rate design, rate objectives, and provision for due process in
setting Program rates. Program rates are ultimately approved by the CEA Board. The Alliance would
retain authority to modify program policies from time to time at its discretion.
8.2 RATE POLICIES
The Alliance will establish rates sufficient to recover all costs related to operation of the CEA Program,
including any reserves that may be required as a condition of financing and other discretionary reserve
funds that may be approved by CEA. As a general policy, rates will be uniform for all similarly situated
customers enrolled in the CEA Program throughout the JPA service territory.
The primary objectives of the rate setting plan are to set rates that achieve the following:
Ø Rate competitive tariff option (default service offering), including a proportionate quantity of
renewable energy in excess of California’s prevailing renewable energy procurement mandate;
Ø Voluntary renewable energy supply option (renewable content greater than the CEA default retail
service offering);
Ø Rate stability;
Ø Equity among customers in each tariff;
Ø Customer understanding; and
Ø Revenue sufficiency.
Each of these objectives is described below.
8.3 RATE COMPETITIVENESS
The primary goal is to offer competitive rates for electric services that CEA would provide to participating
customers. For participants in the CEA default energy product, the goal would be for CEA Program target
generation rates to be initially at least two percent below, subject to actual energy product pricing and
decisions of the Board, similar generation rates offered by SDG&E. For participants in the CEA’s Program’s
voluntary 100% renewable energy product, the goal would be to offer the lowest possible customer rates
with an incremental monthly cost premium reflective of the actual cost of additional renewable energy
supply required to serve such customers.
Competitive rates will be critical to attracting and retaining key customers. In order for CEA to be
successful, the combination of price and value must be perceived as superior when compared to the
bundled SDG&E alternative. As planned, the value provided by the CEA Program will include a local
community focus, investment and control.
May 12, 2020 Item #8 Page 76 of 137
Clean Energy Alliance Implementation Plan
Rate Setting, Program Terms and Conditions 31 December 2019
As previously discussed, the CEA Program will increase renewable energy supply to program customers
by offering two distinct energy products. The default product for CEA Program customers will increase
renewable energy supply to a minimum 50%, while maintaining generation rates that are targeted to
provide a minimum two percent discount from comparable SDG&E rates. The initial renewable energy
content provided under CEA’s default product will exceed California’s prevailing renewable energy
procurement mandate during the initial years of operation, increasing to 60% by 2030. CEA will also offer
its customers a voluntary 100% renewable energy tariff at rates that reflect CEA’s cost for procuring
related energy supplies.
Participating qualified low- or fixed-income households, such as those currently enrolled in the California
Alternate Rates for Energy (“CARE”) program, will be automatically enrolled in the default energy product
and will continue to receive related discounts on monthly electricity bills through SDG&E.
8.4 RATE STABILITY
CEA will offer stable rates by hedging its supply costs over multiple time horizons and by including
renewable energy supplies that exhibit stable costs. Rate stability considerations may prevent CEA
Program rates from directly tracking similar rates offered by the distribution utility, SDG&E, and may result
in differences from the general rate-related targets initially established for the CEA Program. The Alliance
plans to offer the most competitive rates possible after all Program operating costs are recovered and
reserve targets are achieved.
8.5 EQUITY AMONG CUSTOMER CLASSES
Initial rates of the CEA Program will be set based on cost-of-service considerations with reference to the
rates customers would otherwise pay to SDG&E. Rate differences among customer classes will reflect the
rates charged by the local distribution utility as well as differences in the costs of providing service to each
class. Rate benefits may also vary among customers within the major customer class categories,
depending upon the specific rate designs adopted by the Alliance.
8.6 CUSTOMER UNDERSTANDING
The goal of customer understanding involves rate designs that are relatively straightforward so that
customers can readily understand how their bills are calculated. This not only minimizes customer
confusion and dissatisfaction but will also result in fewer billing inquiries to the CEA Program’s customer
service call center. Customer understanding also requires rate structures to reflect rational rate design
principles (i.e., there should not be differences in rates that are not justified by costs or by other policies
such as providing incentives for conservation).
8.7 REVENUE SUFFICIENCY
CEA Program rates must collect sufficient revenue from participating customers to fully fund the annual
CEA operating budget. Rates will be set to collect the adopted budget based on a forecast of electric sales
for the budget year. Rates will be adjusted as necessary to maintain the ability to fully recover all costs of
the CEA Program, subject to the disclosure and due process policies described later in this chapter. To
ensure rate stability, funds available in CEA’s rate stabilization reserve may be used from time to time to
augment operating revenues.
May 12, 2020 Item #8 Page 77 of 137
Clean Energy Alliance Implementation Plan
Rate Setting, Program Terms and Conditions 32 December 2019
8.8 RATE DESIGN
CEA will generally match the rate structures from SDG&E’s standard rates to avoid the possibility that
customers would see significantly different bill impacts as a result of changes in rate structures that would
take effect following enrollment in the CEA Program.
8.9 NET ENERGY METERING
As planned, customers with on-site generation eligible for net metering from SDG&E will be offered a net
energy metering rate from CEA. Net energy metering allows for customers with certain qualified solar or
wind distributed generation to be billed on the basis of their net energy consumption. CEA’s net energy
metering tariff will apply to the generation component of the bill, and the SDG&E net energy metering
tariff will apply to the utility’s portion of the bill. CEA plans to pay customers for excess power produced
from net energy metered generation systems in accordance with the rate designs adopted by the JPA.
The goal is to offer a higher payout for surplus generation than SDG&E. In order to minimize the impact
of mid-relevant period true-ups, NEM customers may be enrolled over multiple phases.
8.10 DISCLOSURE AND DUE PROCESS IN SETTING RATES AND ALLOCATING COSTS AMONG
PARTICIPANTS
Initial program rates will be adopted by the CEA Board following the establishment of the first year’s
operating budget prior to initiating the customer notification process. Subsequently, CEA will prepare an
annual budget and corresponding customer rates. Following the commencement of service, any
proposed rate adjustment will be made to the Board and affected customers will be given the opportunity
to provide comment on the proposed rate changes.
After proposing a rate adjustment, CEA will furnish affected customers with a notice of its intent to adjust
rates, either by mailing such notices postage prepaid to affected customers, by including such notices as
an insert to the regular bill for charges transmitted to affected customers, by including a related message
directly on the customer’s monthly electricity bill (on the page addressing CEA charges) or by following
CEA’s public hearing noticing procedures adopted by the Board. The notice will provide a summary of the
proposed rate adjustment and will include a link to the CEA Program website where information will be
posted regarding the amount of the proposed adjustment, a brief statement of the reasons for the
adjustment, and the mailing address of the CEA Program to which any customer inquiries relative to the
proposed adjustment, including a request by the customer to receive notice of the date, time, and place
of any hearing on the proposed adjustment, may be directed.
May 12, 2020 Item #8 Page 78 of 137
Clean Energy Alliance Implementation Plan
Customer Rights and Responsibilities 33 December 2019
9 CUSTOMER RIGHTS AND RESPONSIBILITIES
This Chapter discusses customer rights, including the right to opt-out of the CEA Program and the right to
privacy of customer usage information, as well as obligations customers undertake upon agreement to
enroll in the CCA Program. All customers that do not opt out within 30 days of the fourth enrollment
notice will have agreed to become full status program participants and must adhere to the obligations set
forth below, as may be modified and expanded by the Board from time to time.
By adopting this Implementation Plan, the Alliance will have approved the customer rights and
responsibilities policies contained herein to be effective at Program initiation. The Alliance retains
authority to modify program policies from time to time at its discretion.
9.1 CUSTOMER NOTICES
At the initiation of the customer enrollment process, four notices will be provided to customers describing
the Program, informing them of their opt-out rights to remain with utility bundled generation service, and
containing a simple mechanism for exercising their opt-out rights. The first notice will be mailed to
customers approximately sixty days prior to the date of automatic enrollment. A second notice will be
sent approximately thirty days later. The Alliance will likely use its own mailing service for requisite
enrollment notices rather than including the notices in SDG&E’s monthly bills. This is intended to increase
the likelihood that customers will read the enrollment notices, which may otherwise be ignored if included
as a bill insert. Customers may opt out by notifying CEA using the CEA Program’s designated telephone-
based or Internet opt-out processing service. Should customers choose to initiate an opt-out request by
contacting SDG&E, they would be transferred to the CEA Program’s call center to complete the opt-out
request. Consistent with CPUC regulations, notices returned as undelivered mail would be treated as a
failure to opt out, and the customer would be automatically enrolled.
Following automatic enrollment, at least two notices will be mailed to customers within the first two
billing cycles (approximately sixty days) after CEA service commences. Opt-out requests made on or
before the sixtieth day following start of CEA Program service will result in customer transfer to bundled
utility service with no penalty. Such customers will be obligated to pay charges associated with the electric
services provided by CEA during the time the customer took service from the CEA Program, but will
otherwise not be subject to any penalty or transfer fee from CEA.
Customers who establish new electric service accounts within the Program’s service area will be
automatically enrolled in the CEA Program and will have sixty days from the start of service to opt out if
they so desire. Such customers will be provided with two enrollment notices within this sixty-day post-
enrollment period. Such customers will also receive a notice detailing CEA’s privacy policy regarding
customer usage information. CEA will have the authority to implement entry fees for customers that
initially opt out of the Program, but later decide to participate. Entry fees, if deemed necessary, would
aid in resource planning by providing additional control over the CEA Program’s customer base.
May 12, 2020 Item #8 Page 79 of 137
Clean Energy Alliance Implementation Plan
Customer Rights and Responsibilities 34 December 2019
9.2 TERMINATION FEE
Customers that are automatically enrolled in the CEA Program can elect to transfer back to the incumbent
utility without penalty within the first two months of service. After this free opt-out period, customers
will be allowed to terminate their participation but may be subject to payment of a Termination Fee,
which CEA reserves the right to impose, if deemed necessary. Customers that relocate within CEA’s
service territory would have CEA service continued at their new address. If a customer relocating to an
address within CEA’s service territory elected to cancel CCA service, the Termination Fee could be applied.
Program customers that move out of CEA’s service territory would not be subject to the Termination Fee.
If deemed applicable by CEA, SDG&E would collect the Termination Fee from returning customers as part
of CEA’s final bill to the customer.
If adopted, the Termination Fee would be clearly disclosed in the four enrollment notices sent to
customers during the sixty-day period before automatic enrollment and following commencement of
service. The fee could also be adopted or changed by the CEA Board subject to applicable customer
noticing requirements. Other CCAs have adopted small or zero-dollar termination fees, and CEA would
likely do the same initially.
Customers electing to terminate service after the initial notification period would be transferred to SDG&E
on their next regularly scheduled meter read date if the termination notice is received a minimum of
fifteen days prior to that date. Such customers would also be liable for the reentry fees imposed by SDG&E
and would be subject to SDG&E’s current terms and conditions, including being required to remain on
bundled utility service for a period of one year, as described in the utility CCA tariffs.
9.3 CUSTOMER CONFIDENTIALITY
CEA will establish policies covering confidentiality of customer data that are fully compliant with the
required privacy protection rules for CCA customer energy usage information, as detailed within Decision
12-08-045. CEA will maintain the confidentiality of individual customers’ names, service addresses, billing
addresses, telephone numbers, account numbers, and electricity consumption, except where reasonably
necessary to conduct business of the CEA Program or to provide services to customers, including but not
limited to where such disclosure is necessary to (a) comply with the law or regulations; (b) enable CEA to
provide service to its customers; (c) collect unpaid bills; (d) obtain and provide credit reporting
information; or (e) resolve customer disputes or inquiries. CEA will not disclose customer information for
telemarketing, e-mail, or direct mail solicitation. Aggregate data may be released at CEA’s discretion.
9.4 RESPONSIBILITY FOR PAYMENT
Customers will be obligated to pay CEA Program charges for service provided through the date of transfer
including any applicable Termination Fees. Pursuant to current CPUC regulations, CEA will not be able to
direct that electricity service be shut off for failure to pay CEA bills. However, SDG&E has the right to shut
off electricity to customers for failure to pay electricity bills, and SDG&E Electric Rule 23 mandates that
partial payments are to be allocated pro rata between SDG&E and the CCA. In most circumstances,
customers would be returned to utility service for failure to pay bills in full and customer deposits (if any)
would be withheld in the case of unpaid bills. SDG&E would attempt to collect any outstanding balance
from customers in accordance with Rule 23 and the related CCA Service Agreement. The proposed
process is for two late payment notices to be provided to the customer within 30 days of the original bill
May 12, 2020 Item #8 Page 80 of 137
Clean Energy Alliance Implementation Plan
Customer Rights and Responsibilities 35 December 2019
due date. If payment is not received within 45 days from the original due date, service would be
transferred to the utility on the next regular meter read date, unless alternative payment arrangements
have been made. Consistent with the CCA tariffs, Rule 23, service cannot be discontinued to a residential
customer for a disputed amount if that customer has filed a complaint with the CPUC, and that customer
has paid the disputed amount into an escrow account.
9.5 CUSTOMER DEPOSITS
Under certain circumstances, CEA customers may be required to post a deposit equal to the estimated
charges for two months of CCA service prior to obtaining service from the CEA Program. A deposit would
be required for an applicant who previously had been a customer of SDG&E or CEA and whose electric
service has been discontinued by SDG&E or CEA during the last twelve months of that prior service
arrangement as a result of bill nonpayment. Such customers may be required to reestablish credit by
depositing the prescribed amount. Additionally, a customer who fails to pay bills before they become
past due as defined in SDG&E Electric Rule 11 (Discontinuance and Restoration of Service), and who
further fails to pay such bills within five days after presentation of a discontinuance of service notice for
nonpayment of bills, may be required to pay said bills and reestablish credit by depositing the prescribed
amount. This rule will apply regardless of whether or not service has been discontinued for such
nonpayment6. Failure to post deposit as required would cause the account service transfer request to be
rejected, and the account would remain with SDG&E.
6 A customer whose service is discontinued by Clean Energy Alliance is returned to SDG&E generation service.
May 12, 2020 Item #8 Page 81 of 137
Clean Energy Alliance Implementation Plan
Procurement Process 36 December 2019
10 PROCUREMENT PROCESS
10.1 INTRODUCTION
This Chapter describes CEA’s initial procurement policies and the key third party service agreements by
which the Alliance will obtain operational services for the CEA Program. By adopting this Implementation
Plan, the Alliance will have approved the general procurement policies contained herein to be effective
at Program initiation. CEA retains authority to modify Program policies from time to time at its discretion.
10.2 PROCUREMENT METHODS
CEA will enter into agreements for a variety of services needed to support program development,
operation and management. It is anticipated that CEA will generally utilize competitive procurement
methods for services but may also utilize direct procurement or sole source procurement, depending on
the nature of the services to be procured. Direct procurement is the purchase of goods or services without
competition when multiple sources of supply are available. Sole source procurement is generally to be
performed only in the case of emergency or when a competitive process would be an idle act.
CEA will utilize a competitive solicitation process to enter into agreements with entities providing
electrical services for the program. Agreements with entities that provide professional legal or consulting
services, and agreements pertaining to unique or time sensitive opportunities, may be entered into on a
direct procurement or sole source basis at CEA’s discretion. Authority for terminating agreements will
generally mirror the authority for entering into such agreements.
10.3 KEY CONTRACTS
10.3.1 Electric Supply
CEA will procure initial energy supply, as well as Scheduling Coordinator Services, through competitive
solicitation in the over-the-counter electricity markets. Suppliers will be selected to hedge CEA’s financial
risk, meet its capacity obligations and achieve its environmental objectives. CEA will administer Request
for Proposal processes for energy supply. Procurement will commence once this implementation plan has
been approved and the CEA Board has made the final determination to proceed to going live with the
CCA.
Procurement will be an ongoing process in order to achieve desired levels of risk mitigation by dollar-cost-
averaging supply costs. In addition, particular strategies will be employed to mitigate the risk of changes
to the PCIA impacting CEA’s rate competitiveness. Specifically, this entails procuring a certain amount of
supply annually during the month of October when the PCIA market price benchmark is set for the coming
year.
CEA’s wholesale services provider will also serve as the Scheduling Coordinator for scheduling loads,
resources and Inter-SC trades into the CAISO market. In addition, the provider will be responsible for
ensuring CEA’s compliance with all applicable RA and regulatory requirements imposed by the CPUC or
FERC.
May 12, 2020 Item #8 Page 82 of 137
Clean Energy Alliance Implementation Plan
Contingency Plan for Program Termination 37 December 2019
10.3.2 Data Management Contract
A data manager will provide the retail customer services of billing and other customer account services
(electronic data interchange or EDI with SDG&E, billing, remittance processing, and account
management). The data management contract will be awarded to an experienced data management
services provider.
The data manager is responsible for the following services:
Ø Data exchange with SDG&E;
Ø Technical testing;
Ø Customer information system;
Ø Customer call center;
Ø Billing administration/retail settlements;
Ø Settlement quality meter data reporting; and
Ø Reporting and audits of utility billing.
Utilizing a third party for account services eliminates a significant expense associated with implementing
a customer information system. Such systems can impose significant information technology costs and
take significant time to deploy. Separation of the data management contract from the energy supply
contract provides the JPA with greater flexibility to change energy suppliers, if desired, without facing an
expensive data migration issue.
11 CONTINGENCY PLAN FOR PROGRAM TERMINATION
11.1 INTRODUCTION
This Chapter describes the process to be followed in the case of CEA Program termination. By adopting
the original Implementation Plan, the Alliance will have approved the general termination process
contained herein to be effective at Program initiation. In the unexpected event that the JPA would
terminate the CEA Program and return its customers to SDG&E service, the proposed process is designed
to minimize the impacts on its customers and on SDG&E. The proposed termination plan follows the
requirements set forth in SDG&E’s tariff Rule 27 governing service to CCAs. The JPA retains authority to
modify program policies from time to time at its discretion.
11.2 TERMINATION BY CLEAN ENERGY ALLIANCE
CEA will offer services for the long term with no planned Program termination date. In the unanticipated
event that the JPA decides to terminate the Program, the Board would vote on Program termination.
After any applicable restrictions on such termination have been satisfied, notice would be provided to
customers six months in advance that they will be transferred back to SDG&E. A second notice would be
provided during the final sixty-days in advance of the transfer. The notice would describe the applicable
May 12, 2020 Item #8 Page 83 of 137
Clean Energy Alliance Implementation Plan
Contingency Plan for Program Termination 38 December 2019
distribution utility bundled service requirements for returning customers then in effect, such as any
transitional or bundled portfolio service rules.
At least one-year advance notice would be provided to SDG&E and the CPUC before transferring
customers, and CEA would coordinate the customer transfer process to minimize impacts on customers
and ensure no disruption in service. Once the customer notice period is complete, customers would be
transferred en masse on the date of their regularly scheduled meter read date.
CEA will post a bond or maintain funds held in reserve to pay for potential transaction fees charged to the
Program for switching customers back to distribution utility service. Reserves would be maintained
against the fees imposed for processing customer transfers (CCA Service Requests). The Public Utilities
Code requires demonstration of insurance or posting of a bond sufficient to cover reentry fees imposed
on customers that are involuntarily returned to distribution utility service under certain circumstances.
The cost of reentry fees is the responsibility of the energy services provider or the community choice
aggregator, except in the case of a customer returned for default or because its contract has expired. CEA
will post financial security in the appropriate amount as part of its registration materials and will maintain
the financial security in the required amount, as necessary.
May 12, 2020 Item #8 Page 84 of 137
Clean Energy Alliance Implementation Plan
Appendix A: Clean Energy Alliance Resolution No. 2019-003 (Adopting Implementation Plan) 39
December 2019
12 APPENDIX A: CLEAN ENERGY ALLIANCE RESOLUTION NO. 2019-003
(ADOPTING IMPLEMENTATION PLAN)
May 12, 2020 Item #8 Page 85 of 137
Draft Projected Financial Results
1
Annual DRAFT Pro Forma Projections for a Community Choice Aggregation Program
Clean Energy Alliance
Fiscal Year Ending:2020 2021 2022 2023 2024 2025
I. Revenue - 9,533,643 69,970,228 71,333,092 72,718,018 74,125,343
II. Operating Expenses
Power Supply - 8,103,205 58,057,665 59,435,021 60,960,894 61,960,598
Staff 50,000 235,000 600,000 618,000 636,540 655,636
Administrative Costs*253,000 1,105,691 2,444,552 2,495,095 2,555,592 2,614,773
Subtotal Operating Expenses 303,000 9,443,896 61,102,216 62,548,116 64,153,025 65,231,007
Operating Margin (303,000) 89,748 8,868,011 8,784,977 8,564,992 8,894,335
III. Financing
Interest - 101,250 102,309 62,964 22,421 (0)
Principal - -1,347,409 1,507,544 1,547,985 130,863
Subtotal Financing - 101,250 1,449,718 1,570,507 1,570,406 130,863
Operating Margin Less Financing (303,000) (11,502) 7,418,293 7,214,469 6,994,586 8,763,473
IV. Cash From Financing 450,000 4,000,000 - - - -
V. Other Uses
CPUC and CAISO Deposits 147,000 500,000 - - - -
Collateral Deposits 2,500,000 - - - -
Reserve Additions - 476,682 3,498,511 3,566,655 3,635,901 3,706,267
Subtotal Other Uses 147,000 3,476,682 3,498,511 3,566,655 3,635,901 3,706,267
VI. Net Surplus/(Deficit)- 511,815 3,919,782 3,647,815 3,358,685 5,057,206
VII. Cumulative Reserve - 476,682 3,975,194 7,541,848 11,177,749 14,884,016
VIII. Cumulative Net Surplus - 511,815 4,431,597 8,079,412 11,438,097 16,495,303
* Comprised of Technical and Legal Services, Customer Outreach and Communications, Utility Services Fees, Data Management Services, Uncollectibles
Exhibit 5
May 12, 2020 Item #8 Page 87 of 137
Board of Directors Meeting Agenda
April 16, 2020, 2 p.m.
City of Del Mar | Virtual Meeting
Per State of California Executive Order N-29-20, and in the interest of public health and safety to
prevent and mitigate the effects of the COVID-19 pandemic, the Clean Energy Alliance Joint
Powers Authority Board of Directors (Board) meetings will temporarily be held electronically or
by teleconferencing. All public meetings will comply with public noticing requirements in the
Brown Act and will be made accessible electronically to all members of the public seeking to
observe the Board meeting and provide public comment, the process for which is further
described blow. These procedures shall remain in place during the period in which state or local
health officials have imposed or recommend social distancing measures.
Members of the public can watch the meeting live on the City of Del Mar’s website at:
http://delmar.12milesout.com/Video/Live
Members of the public can participate in the meeting by e-mailing comments to the Board
Secretary at cityclerk@delmar.ca.us by 1 PM the day of the meeting. The subject line of your
email should clearly state the item number you are commenting on. If you desire to have your
comment read into the record during the meeting, please note that in the email subject line and
limit the comment to 500 words or less. There is no character limit for comments not being read
into the record. All comments will be transmitted to Board members prior to the start of the
meeting.
CALL TO ORDER & ROLL CALL
FLAG SALUTE
PUBLIC COMMENT
Each person wishing to comment to the Board on any matter not on the agenda shall submit a written
comment to the Board Secretary by 1:00 PM the day of the meeting by emailing cityclerk@delmar.ca.us.
Please note “CEA Public Oral” in the subject line of your email. If you desire to have your comment read
into the record at the Board meeting, please indicate so in the subject line of your email and limit your e-
mail to 500 words or less. State law prohibits the Board from taking action on items not listed on the
agenda. Comments requiring follow up will be referred to staff and, if appropriate, considered at a future
Board meeting.
BOARD COMMENTS & ANNOUNCEMENTS
PRESENTATIONS
Exhibit 6
May 12, 2020 Item #8 Page 88 of 137
NEW BUSINESS
Item 1: Interim Chief Executive Officer Update
RECOMMENDATION
1.Receive Community Choice Aggregation Update report from Interim Chief
Executive Officer.
2.Receive Community Choice Aggregation Regulatory Affairs report from
Special Counsel.
Item 2: Clean Energy Alliance Draft Financial Pro-Forma Review; FY 20/21 Budget and
Financing Strategy
Clean Energy Alliance (CEA) receive updated financial pro-forma from Pacific
Energy Advisors; discuss FY 20/21 budget and financing strategy.
RECOMMENDATION
1.Receive report on draft financial pro-forma.
2.Provide direction for FY 20/21 staffing and consulting services and
community outreach/communication and marketing.
3.Provide direction on FY 20/21 budget financing strategy.
Item 3: Authorization to Enter into a Contract for Energy Transactions Attorney
Services
RECOMMENDATION
Authorize the Interim Chief Executive Officer to enter into a contract for energy
transactions attorney services with Hall Energy Law for an amount not to exceed
$100,000 through June 30, 2021, subject to General Counsel approval.
Item 4: Clean Energy Alliance Board Schedule Special Meeting for 5-Year Goals &
Vision Workshop
RECOMMENDATION
Clean Energy Alliance Board schedule special meeting for 5-Year goals & vision
workshop to include CCA programs, economic revitilization opportunities, citizen
advisory committee, strategic plan and inclusive sustainable workforce policy.
BOARD MEMBER REQUESTS FOR FUTURE AGENDA ITEMS
ADJOURN
NEXT MEETING: Special Meeting TBD
May 12, 2020 Item #8 Page 89 of 137
Staff Report
DATE: April 16, 2020
TO: Clean Energy Alliance Board of Directors
FROM: Barbara Boswell, Interim Chief Executive Officer
Ty Tosdal, Special Counsel, Tosdal APC
ITEM 1: Operational, Administrative and Regulatory Affairs Update
RECOMMENDATION:
1.Receive Community Choice Aggregation Update Report from Interim CEO
2.Receive Community Choice Aggregation Regulatory Affairs Report from Special Counsel.
BACKGROUND AND DISCUSSION:
This report provides an update to the Clean Energy Alliance (CEA) Board regarding the status of
the operational, administrative and regulatory affairs activities.
OPERATIONAL UPDATE
CEA is meeting its milestones for the implementation of its community choice aggregation
(CCA) program and is on track to begin serving customers in May 2021.
CCA Implementation Plan & Statement of Intent Certification and CCA Registration
A significant step towards implementing CEA was achieved on March 16, 2020, with the
certification of CEA’s Implementation Plan and Statement of Intent by the California Public
Utilities Commission (CPUC) (Attached). Certification
At the February 20, 2020 meeting the Board approved executing the San Diego Gas & Electric
(SDG&E) CCA Service Agreement, which has been submitted to SDG&E and we are awaiting the
executed copy. The SDG&E Service Agreement will be summitted to the CPUC along with the
CCA bond payment. These last two steps are the final requirements for CCA registration and are
expected to be completed within the next week.
Meeting with CPUC Energy Division
At its February 20, 2020 meeting the Board appointed Board Member Kristi Becker to represent
CEA at a meeting with the CPUC Energy Division, who were to be joined by Barbara Boswell and
Ty Tosdal, Special Counsel and staff representatives. The purpose of the meeting was to
provide an overview of CEA, an update of its implementation plans and goals for the program at
launch and to provide an opportunity for the CPUC staff to ask the group question regarding
CEA and the transition of Solana Energy Alliance customers to CEA in anticipation of CPUC
May 12, 2020 Item #8 Page 90 of 137
certifying the CEA Implementation Plan. The meeting had been scheduled to be in held in
person at the CPUC office in San Francisco on March 11, 2020. Due to the early concerns
regarding COVID 19 and travel, the meeting was rescheduled as a conference call. Board
Member Becker, Interim CEO Barbara Boswell, Special Counsel Ty Tosdal, City of Del Mar
Environmental Sustainability and Special Projects Manager Clement Brown and City of Carlsbad
Intergovernmental Affairs Director Jason Haber participated in the call with the CPUC Energy
Division. CEA representatives addressed questions the Energy Division had regarding regulatory
compliance filings required of both CEA and SEA and indicated to Energy Division the
commitment of both CCA programs to meet the various regulatory compliance requirements.
The CPUC subsequently certified the Implementation Plan.
Expansion of Clean Energy Alliance
Greg Wade and Jason Haber participated in a South Orange County Community Choice Alliance
workshop regarding lessons learned and potential opportunities with neighboring cities on
February 20, 2020.
The cities of Escondido, San Marcos and Vista have engaged EES Consulting to complete a CCA
feasibility study which is targeted to be complete by the end of the calendar year.
Staff is also keeping communication lines open with the County of San Diego and Oceanside
regarding their efforts in evaluating CCA in their areas.
Regulatory Compliance Filings
Clean Energy Alliance is in compliance with all required regulatory compliance filings to date,
including the most recent filing of the initial Renewable Portfolio Standards (RPS) Procurement
Plan. The plan is a compliance filing and is separate and distinct from CEA’s overall
procurement strategy and decision-making process, which the Board will ultimately decide.
The RPS plan reflects the CEA is aware of, and plans to comply with, California’s renewable
energy requirements.
The Year-Ahead Resource Adequacy forecast, which informs the California Energy Commission
(CEC) and California Public Utility Commission (CPUC) of CEA’s projected energy load for 2021.
The CEC and CPUC utilize the forecast to develop the Resource Adequacy requirements that
CEA will need to procure. The forecast is in progress and is on track to meet the April 20, 2020
filing deadline. CEA staff and its consultants have been working cooperatively with SDG&E to
ensure the forecasts are coordinated regarding SDG&E’s assumptions related to the departing
load. Should revisions need to be made to the initial forecast, CEA has until May 15, 2020 to
make those revisions.
The Integrated Resource Plan (IRP) provides the CPUC with CEA’s 10-year projected electricity
load as part of the integrated resource planning process to ensure that California’s electric
sector meets its GHG reduction goals while maintaining reliability at the lowest possible costs.
May 12, 2020 Item #8 Page 91 of 137
The IRP was originally due in April 2020, was pushed out to July 2020, and has now been further
pushed out to September 2020.
Coordination with San Diego Gas & Electric
CEA staff and consultants continue to meet with and work collaboratively with SDG&E to
ensure a smooth CCA implementation. The most recent meeting took place March 27, 2020,
topics included a discussion to satisfy SDG&E’s “Meet and Confer” requirement related to the
Year-Ahead Resource Adequacy forecast as well as an update of SDG&E’s bill system
replacement project, known as Envision. Attendees included various SDG&E staff, Barbara
Boswell, Ty Tosdal and Pacific Energy Advisors.
SDG&E updated CEA regarding its energy load forecast assumptions related to the CEA
customer leaving SDG&E service that SDG&E will be applying to the 2021 load forecast. SDG&E
intends to issue a Request for Offers to handle the excess resource adequacy SDG&E may have
due to the departed load. CEA will need to engage the services of a transactions attorney to
execute the agreements and documents necessary for CEA to take advantage of SDG&E’s
request for offers.
SDG&E also informed CEA that SDG&E is tracking on its project timeline towards a go live date
of January 4, 2021. The on-going testing, including end-to-end testing for CCA and transition of
customers will further confirm the operational and application readiness of the systems.
REGULATORY UPDATE
A regulatory update will be provided to the Board by Ty Tosdal, Tosdal Law APC, highlighting
current CPUC proceedings of interest to CEA.
FISCAL IMPACT
There is no fiscal impact associated with this item.
ATTACHMENTS:
Clean Energy Alliance Timeline of Implementation Action Items
California Public Utilities Commission Letter Certifying Clean Energy Alliance Implementation
Plan and Statement of Intent
May 12, 2020 Item #8 Page 92 of 137
May 12, 2020 Item #8 Page 93 of 137
Staff Report
DATE: April 16, 2020
TO: Clean Energy Alliance Board of Directors
FROM: Barbara Boswell, Interim Chief Executive Officer
ITEM 2: Clean Energy Alliance Draft Financial Pro-Forma Review; FY 20/21 Budget and Financing
Strategy
RECOMMENDATION:
1.Receive report on draft financial pro-forma and provide direction for further pro-forma
refinement.
2.Provide direction for FY 20/21 staffing and consulting services and community
outreach/communication and marketing.
3.Provide direction on FY 20/21 budget financing strategy and direct staff to return with
finance plan with the draft budget at the May 21, 2020 Board Meeting.
BACKGROUND AND DISCUSSION:
At its February 20, 2020 regular meeting, CEA Board selected Pacific Energy Advisors (PEA) to
provide technical consulting services in support of its CCA program. One of the first tasks PEA
has undertaken is development of the draft CEA financial pro-forma for its community choice
aggregation (CCA) program, using 3-years historical usage data from San Diego Gas & Electric
(SDG&E), current and projected SDG&E rates, market energy pricing and CEA Joint Powers
Authority Agreement program goals.
Specific assumptions used in the draft pro-forma include:
10% opt-out rate for Del Mar & Carlsbad (conservative based on averages)
7.5% opt-out rate for Solana Beach (reflects current SEA opt-out rate)
50% default renewable energy
No Bucket 3 “Unbundled” Renewable Energy Credits (RECs)
No additional financing or advances from member agencies
Annual 5% revenue contribution to reserves
The chart below summarizes the results of the draft pro-forma over the first 5 full fiscal years of
service:
May 12, 2020 Item #8 Page 96 of 137
Based on current market conditions, CEA can operate a financially viable CCA program, which
generates sufficient revenue to cover its expenditures, contribute funds to an operating reserve
and leave a net surplus to fund Board directed discretionary programs. As with any pro-forma,
the near terms results are more reliable than those in the outer years due to the uncertainty
related to market conditions.
The pro-forma reflects policies and goals established in the JPA Agreement.
Additional program decisions for the Board to consider include:
Rate discount compared to SDG&E comparable generation rates – The draft pro-forma was
developed based on rate parity with SDG&E. The JPA Agreement establishes a target discount
of 2%. Based on current rate assumptions each 1% discount offered to customers reduces
revenue by $1,000,000 annually. Staff seeks Board direction regarding rate discount to be
offered by CEA at program launch.
Staffing plan for FY 20/21 – The pro-forma identifies $260,000 to be used towards staffing
and/or consulting services to fill administrative positions to support implementation and initial
operations in FY 20/21. This amount increases to $600,000 beginning in FY 21/22, for the on-
going operational activities of CEA. Staffing costs are estimated at a lower amount in fiscal year
20/21 based on the projected activities related to procurement, customer outreach &
marketing, program implementation and initial service needs (based on a May 2021 launch).
These estimated costs subject to Board direction and can be scaled to meet the requirements
of the CCA program as determined by the Board.
CEA is currently staffed and supported by a combination of services by Member Agencies and
consulting services agreements.
May 12, 2020 Item #8 Page 97 of 137
The terms of current agreements are:
CONSULTING
FIRM/MEMBER AGENCY SERVICE STATUS
Bayshore Consulting Group,
Inc.
Interim Chief Executive Officer Through June 30, 2020;
may be extended through
mutual agreement
Pacific Energy Advisors Technical Consultant Through June 30, 2020;
may be extended through
mutual agreement
Richards, Watson & Gershon General Counsel Through June 30, 2020;
may be extended through
mutual agreement
Tosdal, APC Special Counsel – Regulatory
Affairs
Through June 30, 2020;
may be extended through
mutual agreement
City of Carlsbad Board Secretary Services/Clerk
Services
Marketing & Communications
Through June 30, 2020;
may be extended through
mutual agreement
City of Del Mar Board Meeting & Clerk Services
(for meetings held at Del Mar)
Through June 30, 2020;
may be extended through
mutual agreement
City of Solana Beach Interim Finance Agent/Treasurer
Board Meeting & Clerk Services
(for meetings held at Solana
Beach)
Through June 30, 2020;
may be extended through
mutual agreement
As CEA looks to fiscal year 20/21, it will be tasked with developing a comprehensive customer
outreach, education and marketing program in support of its CCA launch; developing
procurement policies and holding solicitations to procure energy to meet its renewable energy,
conventional energy and resource adequacy requirements; and establishing operating policies
and procedures that provide the foundation for an effective and efficient organization.
Options available to the Board to meet its needs are to recruit for full-time staff, continue with
its existing consulting arrangements, seek new consulting services, or any combination that the
Board deems will best fit its needs in the coming year. Should the Board decide to seek new or
additional consulting services, it would be prudent to direct staff to initiate solicitation
processes to ensure a smooth transition going into the new fiscal year.
May 12, 2020 Item #8 Page 98 of 137
Operating Reserve Policy – A key component of a financially stable CCA program is the
adoption of reserve policies that set aside funds to mitigate the negative impacts that are
related to the uncertainties of a dynamic rate and energy market environment. In addition to
mitigating the market risk, healthy reserves also serve the purpose of supporting agency credit
requirements related to energy supply purchases. New CCA programs have set operating
reserves targets of 25% - 50% of revenues, with annual contributions building reserves to the
targeted amounts. The pro-forma reflects an annual 5% reserve contribution that would result
in a 25% operating reserve within 5 years. The Board has discretion to confirm the reserve
targets as reflected in the pro-forma or direct adjustment to an amount it determines best fits
the needs of CEA.
Financing Strategy – The draft pro-forma assumed fiscal year 20/21 start-up costs are funded
by loans or lines of credit from 3rd parties and financial institutions, at an average 3% interest
rate. No additional advances from Carlsbad, Del Mar or Solana Beach were anticipated.
The initial FY 19/20 CEA budget was funded with $150,000 advances from each of the three
Member Agencies. The terms of the agreements state that the advances are to be repaid from
future CCA revenues, within three years of the commencement of serving customers (or by
May 2024). In light of the current economic impacts of COVID-19 that the member cities are
having to address, the CEA Board may want to consider amending the terms of the advance
agreements to provide an earlier repayment to the cities.
The advances could be refunded by including the repayment in the financing options shown
below:
Lender Amount Interest Rate
Loan from Calpine Energy
Solutions
$500,000 5%
Line of Credit/Loan from
Financial Institution
Est. $4,000,000 Est. 2% - 3% (to be
determined through
negotiation process)
Calpine Energy Solution’s data management proposal included the offer of a $500,000 loan to
CEA to fund start-up costs at a 5% interest rate with repayment due within 15 months of CEA
starting service to customers. These funds would be available once the agreement between
CEA and Calpine has been executed (currently in progress), pursuant to the terms in the
agreement. These funds may be available quicker than funds acquired through financing from
a financial institution.
CEA received proposals for credit solution from River City Bank, JP Morgan Chase and MUFG
Union Bank in response to its Request for Proposal for Banking and Credit Solutions process.
With direction from the Board, staff will begin negotiation for credit terms with the three
May 12, 2020 Item #8 Page 99 of 137
financial institutions and bring the results back to the Board for final selection and approval of a
credit solution at its May 21, 2020 meeting.
FISCAL IMPACT
There is no fiscal impact associated with this item, however, the direction provided by Board
related to the policy decisions will be used to develop the fiscal year 20/21 budget to be
adopted by the Board at its June 18, 2020 meeting.
ATTACHMENTS:
None.
May 12, 2020 Item #8 Page 100 of 137
Staff Report
DATE: April 16, 2020
TO: Clean Energy Alliance Board of Directors
FROM: Barbara Boswell, Interim Chief Executive Officer
ITEM 3: Authorization to Enter into an Agreement for Energy Transactions Attorney Services
RECOMMENDATION:
Authorize the Interim Chief Executive Officer to enter into an agreement for energy
transactions attorney services to Hall Energy Law PC for an amount not to exceed $100,000,
through June 30, 2021, subject to General Counsel approval.
BACKGROUND AND DISCUSSION:
Clean Energy Alliance (CEA), in its role as community choice aggregator providing electricity to
its customers is required to procure resource adequacy, renewable energy and conventional
energy. The California Public Utilities Commission (CPUC) and California Energy Commission
(CEC) each have established requirements and timelines related to these energy products.
The initial requirements of CEA are related to the procurement of resource adequacy (RA). RA
is not electricity, rather, it is the procurement of generation capacity, to ensure overall grid
reliability. It can be thought of as an insurance policy.
CCAs (as well as all other load serving entities (LSE) such as the Investor Owned Utilities) are
required to procure three types of RA: multi-year local (CEA will need to procure for 2021, 2022
and 2023), annual system and flex. The multi-year local RA requirements for the upcoming year
are set based on the LSE’s annual peak demand in September.
The timeline related to RA compliance is:
April 20, 2020 – Submit initial Year-Ahead Forecast (for 2021)
May 15, 2020 – Final date to make revisions to Year-Ahead Forecast
July 2020 – CEC reviews forecasts; CPUC issues initial year-ahead requirements
August 17, 2020 – Final load forecast for 2021
September 2020 – CEC reviews final forecasts; CPUC issues final year-ahead
requirements
October 2020 – Submit year-ahead filing reflecting contracts meeting
requirements
May 12, 2020 Item #8 Page 101 of 137
Local RA is the only RA type that has a multi-year contractual obligation. For CEA that
obligation involves meeting the requirements for 2021, 2022 and 2023. Local RA is defined as
meeting the needs of the locally constrained area. Historically, San Diego Gas & Electric
(SDG&E) has primarily been responsible for meeting the local RA requirements of the San Diego
local area. Effective with the implementations of CEA and San Diego Community Power (SDCP),
it is anticipated the SDG&E will find itself with excess local RA. In a call with SDG&E on March
27, 2020, it was shared that SDG&E plans to “cast a wide net for RA” in a Request for Offer
(RFO) in April 2020. CEA will need to participate in this RFO process in order to have an
opportunity to acquire local RA from SDG&E. Without participating in this process, CEA
increases its probability of not procuring the local RA as allocated by CPUC.
To be enabled to participate in SDG&E’s RFO process, CEA needs to execute an agreement with
SDG&E known as the Edison Electric Institute (EEI) agreement with a subsequent agreement
known as a confirmation. These agreements require the assistance of an attorney with
specialized expertise in handling these types of highly technical agreements. It was originally
anticipated that these services would not be required until next fiscal year. however, the
upcoming SDG&E RFO process has accelerated the need for this legal expertise.
Three law firms were contacted to provide proposals to provide the services needed for the
upcoming SDG&E solicitations as well as for the upcoming CEA energy procurements.
The chart below summarizes the proposals:
FIRM CCA EXPERIENCE
NOT TO EXCEED
THROUGH 6/30/21 NOTES
Cameron – Daniel Limited $82,000
Lead attorney
experience with CCA’s
has been primarily
through another firm
whose work with CCA’s
is mostly regulatory.
Hall Energy Law PC
Extensive – 10
similar CCA
engagements $100,000
Extensive experience
with energy contracts
for CCA’s, including
working with River City
Bank and PEA. Also
has negotiated 5 EEI
Master Agreements
with SDG&E.
Wilson Sonsini Limited and recent
Not provided – bid at
flat rate per
transaction except for
long-term PPA’s which
No experience with
start-up CCA; work to
be done primarily by
May 12, 2020 Item #8 Page 102 of 137
would be billed at
hourly rates.
associates overseen by
lead partner.
Proposals were reviewed by Greg Stepanicich, CEA General Counsel and Barbara Boswell,
Interim CEO. Both Mr. Stepanicich and Ms. Boswell have had positive experiences working with
Steve Hall of Hall Energy Law and recommend this firm as having the most relevant experience
providing the specialized energy law services needed by CEA.
FISCAL IMPACT
The adopted FY 19/20 budget allocated $130,000 for legal services. It is estimated that $75,000
will be spent through fiscal year end for the existing General Counsel and Specialized Legal
Counsel services leaving $55,000 available for Energy Transactions Attorney, which is
anticipated to be sufficient to cover the costs related to the services needed through June 30,
2020.
ATTACHMENTS:
None.
May 12, 2020 Item #8 Page 103 of 137
Staff Report
DATE: April 16, 2020
TO: Clean Energy Alliance Board of Directors
FROM: Barbara Boswell, Interim Chief Executive Officer
ITEM 4: Schedule Special Meeting for 5-Year Goals & Vision Workshop
RECOMMENDATION:
Clean Energy Alliance Board schedule special meeting for 5-year goals & vision workshop to
include CCA programs, economic revitalization opportunities, citizen advisory committee,
strategic plan and inclusive sustainable workforce policy.
BACKGROUND AND DISCUSSION:
The Clean Energy Alliance (CEA) 5-year goals & vision workshop will provide an opportunity for
the CEA Board to identify and prioritize goals, including economic revitalization that address the
impacts of COVID 19 on local businesses, citizen advisory committee, strategic plan and
inclusive sustainable workforce policy.
FISCAL IMPACT
There is no fiscal impact from this action.
ATTACHMENTS:
None.
May 12, 2020 Item #8 Page 104 of 137
Board of Directors Special Meeting Agenda
May 7, 2020, 2 p.m.
City of Carlsbad | Council Chambers | Virtual Meeting
Per State of California Executive Order N-29-20, and in interest of public health and safety, we
are temporarily taking actions to prevent and mitigate the effects of the COVID-19 pandemic by
holding Clean Energy Alliance Joint Powers Authority meetings electronically or by
teleconferencing. All public meetings will comply with public noticing requirements in the Brown
Act and will be made accessible electronically to all members of the public seeking to observe
and address the Clean Energy Alliance Joint Powers Authority Board of Directors. The meetings
can be watched via livestream at www.carlsbadca.gov . You can participate in the meeting by e-
mailing your comments to the Secretary at clerk@carlsbadca.gov prior to commencement of the
agenda item. If you desire to have your comment read into the record at the meeting, please
indicate so in the first line of your e-mail and limit your e-mail to 500 words or less. These
procedures shall remain in place during the period in which state or local health officials have
imposed or recommended social distancing measures.
CALL TO ORDER:
ROLL CALL:
FLAG SALUTE:
BOARD COMMENTS & ANNOUNCEMENTS
PRESENTATIONS
APPROVAL OF MINUTES:
Minutes of the Meeting held Jan. 16, 2020
Minutes of the Meeting held Feb. 20, 2020
Minutes of the Meeting held April 16, 2020
ACTION:
Exhibit 7
May 12, 2020 Item #8 Page 105 of 137
NEW BUSINESS
Item 1: Clean Energy Alliance Financial Pro-Forma Review; 5-year Goals & Vision
Discussion
Clean Energy Alliance (CEA) discussion of goals/vision for next 5 years to include
discussion on CCA programs, citizen advisory committee, strategic plan and
inclusive sustainable workforce policy.
RECOMMENDATION
Provide direction on CEA programs, economic revitilization opportunities, citizen
advisory committee, strategic plan and inclusive sustainable workforce policy
Item 2: Clean Energy Alliance Board Policy Regarding Handling Unsolicited Proposals
RECOMMENDATION
Clean Energy Alliance Board provide direction on policy regarding handling of
unsolicited proposals.
BOARD MEMBER REQUESTS FOR FUTURE AGENDA ITEMS
ADJOURN:
NEXT MEETING: May 21, 2020, 2 p.m., City of Solana Beach, City Hall (635 S. Highway 101)
Reasonable Accommodations
Persons with a disability may request an agenda packet in appropriate alternative formats as require by the
Americans with Disabilities Act of 1990. Reasonable accommodations and auxiliary aids will be provided to
effectively allow participation in the meeting. Please contact the Carlsbad City Clerk’s Office at 760-434-2808 (voice), 711 (free relay service for TTY users), 760-720-9461 (fax) or clerk@carlsbadca.gov by noon on the Monday
before the Board meeting to make arrangements.
Written Comments
To submit written comments to the Board, please contact the Carlsbad City Clerk’s office at clerk@carlsbadca.gov.
Written materials related to the agenda that are received by 5:00 p.m. on the day before the meeting will be
distributed to the Board in advance of the meeting and posted on the Authority webpage. To review these
materials during the meeting, please see the Secretary
May 12, 2020 Item #8 Page 106 of 137
Clean Energy Alliance - Board of Directors
Meeting Minutes
January 16, 2020 - 2 p.m.
City of Del Mar Town Hall
1050 Camino del Mar, Del Mar California 92014
CALL TO ORDER Chair Schumacher called the meeting to order at 2:00 p.m.
ROLL CALL Present: Chair Cori Schumacher; Vice Chair Ellie Haviland, and Board Member Kristi Becker Absent: None Staff Present: Interim Chief Executive Officer Barbara Boswell; Special Regulatory Counsel, Ty
Tosdal; Del Mar City Manager Scott Huth; Solana Beach City Manager Greg Wade; Del Mar Administrative Services Director/City Clerk Ashley Jones; Carlsbad Intergovernmental Affairs Director Jason Huber; Del Mar Environmental Sustainability and Special Projects Manager Clement Brown; and Carlsbad Community Relations Manager Nikki Matosian PLEDGE OF ALLEGIANCE Vice Chair Haviland led the Pledge of Allegiance. PUBLIC COMMENT 1) Lane Shurman, 1260 Santa Luisa, Solana Beach – Representing the San Diego Energy Alliance, expressed concern about the Board’s direction regarding the product being pursued with regard
to emission standards. 2) Debra Schade, 529 Mar Vista Road, Solana Beach – Representing the Solana Beach School District, expressed the District’s interest in the CEA’s efforts and how that supports the District’s goals. BOARD COMMENTS & ANNOUNCEMENTS
Chair Schumacher reported that she participated today in a conference call with Cal CCA regarding
legislative advocacy and partnerships.
APPROVAL OF MINUTES:
Minutes of the Special Meeting held November 5, 2019
IT WAS MOVED BY VICE CHAIR HAVILAND, SECONDED BY BOARD MEMBER BECKER TO
APPROVE THE NOVEMBER 5, 2019 MEETING MINUTES. (VOTE 3-0)
Ayes: Vice Chair Haviland, Chair Schumacher and Board Member Becker; Noes: 0; Absent: 0; Abstain: 0.
May 12, 2020 Item #8 Page 107 of 137
NEW BUSINESS
ITEM 1: ADMINISTRATIVE, OPERATIONAL AND REGULATORY AFFAIRS UPDATE
Interim CEO Boswell and Special Regulatory Counsel Tosdal provided a presentation on this item.
RECOMMENDATION: Receive and file administrative, operational and regulatory affairs update.
Questions from the Board focused on tracking of SDG&E seasonal rate changes.
ITEM 2: CLEAN ENERGY ALLIANCE CCA ROADMAP, COMMITTEES AND NEW MEMBER
ATTRACTION
RECOMMENDATION: Receive report on Community Choice Aggregation actions and provide
direction regarding committees and new member attraction.
Interim CEO Boswell provided a presentation on this item covering required next steps and related timing
for each between January and April 2020; formation of Board committees.
Board questions focused on clarification on the color coding of action items included in the presentation
timeline; timing for Board goal setting workshop; staff capacity with regard to committee support if
formed.
Board discussion focused on concern about capacity to work on committee formation at this time,
support for deferring exploring formation of committees until after launch time and focusing efforts on
getting the CEA off of the ground; support for engaging the public and use of alternate board members
to help keep things moving through committees; potential to use committees to help with public
education and outreach; suggestion that an Ad-Hoc committee be formed with focus on goal setting,
staffing, and energy mix recommendations with two committee appointees for each board member;
potential and interest in attracting other participating agencies/members; value in creating a solid base
before expanding to include new members and looking for new members that have aligned goals and
would be a good fit; could be some benefit in staying smaller for procurement purposes; need to create
goals for JPA prior to developing a new member recruitment strategy; approach to outreach with other
potential members; how adding new members may help to minimize risk; risk of missing out on potential
new members who may be recruited by other CCA JPA’s if the CEA Board puts that effort on hold; and
factors for attraction could consider geographic location, load size, or both.
There was concensus among the Board to grow the board. Next steps is to develop a strategy which
identifies criteria to priortize new member recruitment. Cities currently undergoing or have already
completed a feasibility study as a first priority and other cities in the geographic zone and SDG&E
territory.
The Board directed Interim CEO Boswell to return at a future meeting, when appropriate, with a
recommendation for formation of an Ad-Hoc citizen’s advisory committee.
May 12, 2020 Item #8 Page 108 of 137
ITEM 3: AUTHORIZE REQUEST FOR QUALIFICATIONS FOR CLEAN ENERGY ALLIANCE
TECHNICAL CONSULTANT SERVICES
RECOMMENDATION: Direct staff to issue a Request for Proposal for Technical Consultant Services.
A presentation on this item was provided by Interim CEO Boswell, which discussed the needs for a
technical consultant.
IT WAS MOVED BY BOARD MEMBER BECKER, SECONDED BY VICE CHAIR HAVILAND TO
AUTHORIZE REQUEST TO ISSUE THE RFP (VOTE 3-0)
Ayes: Vice Chair Haviland, Chair Schumacher and Board Member Becker; Noes: 0; Absent: 0; Abstain: 0.
ITEM 4: AUTHORIZE REQUEST FOR PROPOSAL FOR DATA MANAGER/CALL CENTER
SERVICES
RECOMMENDATION: Direct staff to issue a Request for Proposal for Data Manager/Call Center
Services.
Interim CEO Boswell presented this item to the Board, which identified the need for data manager/call
center services.
IT WAS MOVED BY BOARD MEMBER BECKER, SECONDED BY VICE CHAIR HAVILAND TO
AUTHORIZE THE RFP. (VOTE 3-0)
Ayes: Vice Chair Haviland, Chair Schumacher and Board Member Becker; Noes: 0; Absent: 0; Abstain: 0.
ITEM 5: SERVICE AGREEMENTS WITH MEMBER AGENCIES
RECOMMENDATION: Authorize Interim CEO Boswell to execute service agreements with Member
Agencies at amounts not to exceed $65,000 for the City of Carlsbad, $2,800 for the City of Del Mar
and $16,000 for the City of Solana Beach.
Interim CEO Boswell provided a presentation on this item.
IT WAS MOVED BY VICE CHAIR HAVILAND, SECONDED BY BOARD MEMBER BECKER TO
APPROVE THE SERVICES AGREEMENTS AND AUTHORIZE INTERIM CEO BOSWELL TO
EXECUTE THE AGREEMENTS. (VOTE 3-0)
Ayes: Vice Chair Haviland, Chair Schumacher and Board Member Becker; Noes: 0; Absent: 0; Abstain: 0.
May 12, 2020 Item #8 Page 109 of 137
ITEM 6: RESOLUTION DESIGNATING AUTHORIZED CHECK SIGNERS AND ELECTRONIC
PAYMENT APPROVERS
RECOMMENDATION: Adopt resolution.
Interim CEO Boswell provided a presentation on this item.
IT WAS MOVED BY VICE CHAIR HAVILAND, SECONDED BY BOARD MEMBER BECKER, TO
APPROVE THE RESOLUTION. (VOTE 3-0)
Ayes: Vice Chair Haviland, Chair Schumacher and Board Member Becker; Noes: 0; Absent: 0; Abstain: 0.
ITEM 7: CLEAN ENERGY ALLIANCE PUBLIC OUTREACH AND MARKETING
RECOMMENDATION: Receive report on public outreach and marketing efforts and provide direction.
Carlsbad Community Relations Manager Matosian provided a presentation on this item which focused
on communications done to date; potential future activities; and next steps through June 30, 2020.
Board comments and questions focused on avoiding use of powerlines in communications; and how
CEA website FAQ’s are generated; status of work on logo development; feedback on website;
consideration to add information to the website for potential partners to access.
The direction given to staff by Interim CEO Boswell is to have a section on the website that provides a
form for individuals to fill out with ideas of services that would be beneficial or projects they might want
to consider. She noted this information could be a resource for RFPs to be sent out to.
ITEM 8: APPLICATION TO JOIN CALIFORNIA COMMUNITY CHOICE ASSOCIATION AS AN
AFFILIATE MEMBER
RECOMMENDATION:
1. Authorize the Interim CEO to submit an application to California Community Choice Association (CalCCA) for Clean Energy Alliance to join as an affiliate member.
2. Approve annual CalCCA membership dues of $1,500. Interim CEO Boswell provided a presentation on this item.
IT WAS MOVED BY BOARD MEMBER BECKER, SECONDED BY VICE CHAIR HAVILAND TO
AUTHORIZE THE INTERIM CEO TO SUBMIT AN APPLICATION TO CAL CCA AND APPROVED
MEMBERSHIP DUES OF $1,500. (VOTE 3-0)
Ayes: Vice Chair Haviland, Chair Schumacher and Board Member Becker; Noes: 0; Absent: 0; Abstain: 0.
May 12, 2020 Item #8 Page 110 of 137
BOARD MEMBER REQUESTS FOR FUTURE AGENDA ITEMS
Next meeting to be held in Solana Beach on February 20, 2020, at 5 p.m.
ADJOURNMENT Chair Schumacher adjourned the meeting at 4:11 p.m.
Ashley Jones, Administrative Services Director/City Clerk
May 12, 2020 Item #8 Page 111 of 137
Clean Energy Alliance - Board of Directors
Meeting Minutes
February 20, 2020, 2:00 p.m.
City of Solana Beach | City Council Chambers
635 S. Highway 101 | Solana Beach, CA 92014
CALL TO ORDER: 2:00 p.m.
ROLL CALL: Schumacher, Haviland, Becker
FLAG SALUTE
Board Member Becker led the Pledge of Allegiance.
PUBLIC COMMENT
Time is provided so members of the public can address the Board on items that are not listed on the
agenda. Speakers are limited to three (3) minutes each. In conformance with the Brown Act, no Board
action can occur on items presented during Public Comment. If you desire to speak during Public Comment,
fill out a SPEAKER CARD and submit it to the Board Secretary. When you are called to speak, please come
forward to the podium and state your name.
Gretchen Newsom, IBEW (International Brotherhood of Electrical Workers) Local 569, requested that a
Strategic Plan and an Inclusive and Sustainable Workforce Policy be added to the task matrix of action
items.
Dinah Wilier, SDG&E, spoke about their meeting with CEA in January to discuss replacement of SDG&E’s
customer information system, Envision, and their efforts to meet the launch timelines outlined in the CEA
Implementation Plan, potential unforeseen challenges in this project, the critical testing period that would
inform the timing, continuing to work with CEA by way of biweekly calls throughout the Envision launch
and critical stabilization period, and meeting the outlined timeline would continue to remain a top priority
for SDG&E.
Emily Rogers Guild and Ebba Selling, Swedish American Chamber of Commerce - San Diego, spoke about
their organization focused on CleanTech and Life Science industries and announced their Annual Green
Connections event in November featuring partners, speakers, and sponsors in renewable energy, smart
building, and energy storage.
Lane Sharman, the Center for Community Energy a successor organization to the San Diego Energy
District, spoke about their June conference on CCAs (Community Choice Aggregations).
BOARD COMMENTS & ANNOUNCEMENTS: None
PRESENTATIONS: None
APPROVAL OF MINUTES:
Minutes of the Special Meeting held November 19, 2019
Minutes of the Regular Meeting held December 19, 2019
May 12, 2020 Item #8 Page 112 of 137
Motion by Vice Chair Haviland, seconded by Board Member Becker to approve the submitted meeting
minutes. Motion carried unanimously 3/0.
NEW BUSINESS
Item 1: Interim CEO Update
RECOMMENDATION
1. Receive Community Choice Aggregation Update report from Interim CEO.
2. Select Board Member to represent CEA at meeting with California Public Utilities
Commission.
Barbara Boswell, Interim CEO (Chief Executive Officer), reviewied the report and presented a PowerPoint
(on file) regarding the administrative and operational update.
Ty Tosdal, CEA regulatory Special Counsel, continued the PowerPoint (on file) reviewing the regulatory
update.
Motion by Chair Shumacher, seconded by Vice Chair Haviland to appoint Board Member Becker to
represent CEA at the CPUC meeting. Motion carried unanimously 3/0
Motion by Chair Shumacher, seconded by Vice Chair Haviland to add discussion of a Strategic Plan and an
Inclusive Sustainable Workforce Policy to the workshop. Motion carried unanimously 3/0
Item 2: Request for Proposal #2020-001 Permanent Banking Services and Credit Solutions
Selection
RECOMMENDATION
1. Approve selection of River City Bank to provide permanent banking services to Clean
Energy Alliance.
2. Authorize the Interim Chief Executive Officer to execute an agreement for banking
services, for a three-year term, with the option to extend for two additional years,
subject to General Counsel approval.
3. Authorize the Interim Chief Executive Officer and Interim Treasurer to develop a
funding strategy for initial Clean Energy Alliance start-up costs and return to April
2020 for Board consideration.
Barbara Boswell, Interim CEO, reviewied the report.
Motion by Board Member Becker, seconded by Vice Chair Haviland to approve selection of River City Bank
for banking services; authorize the Interim CEO to execute an agreement for banking services, for a three-
year term, with the option to extend for two additional years, subject to General Counsel approval; and
authorize the Interim CEO and Interim Treasurer to develop a funding strategy for initial Clean Energy
Alliance start-up costs and return to April 2020 for Board consideration. Motion carried unanimously 3/0
Rose Cucicea, River City Bank, introduced herself.
Item 3: Request for Qualifications #2020-002 Clean Energy Alliance Technical Consultant
Services Selection
May 12, 2020 Item #8 Page 113 of 137
RECOMMENDATION
Approve selection of CEA technical consultant and authorize Interim Chief Executive
Officer to execute an agreement, for an amount not to exceed $ , subject to General
Counsel approval.
Barbara Boswell, Interim CEO, reviewied the report.
Motion by Board Member Becker, seconded by Vice Chair Haviland to approve the selection of Pacific
energy advisors to provide technical consulting services to the Clean Energy Alliance; and authorize the
interim chief executive officer to execute an agreement for technical consulting services for an amount
not to exceed $75,000 through June 30th, 2020, with the option to extend through fiscal year 2020 2021
for an additional amount of 25,000, subject to General Council approval. Motion carried unanimously 3/0
Kirby Dusel, Pacific Energy Advisors, introduced himself and Donna Stein and their exeperience in the
electric utility indsutry and CCAs.
Item 4: Request for Proposal #2020-003 Data Manager/Call Center Services Selection
RECOMMENDATION
Approve selection of Data Manager/Call Center Services provider and authorize Interim
Chief Executive Officer and General Counsel to negotiate agreement for an amount not
to exceed $__.
Barbara Boswell, Interim CEO, reviewied the report.
Dennis Ferment, President EDMS, spoke about their submittal and projected savings, not being selected,
their abiltiies to onboard new systems quickly, and their work with SDG&E on the EDI front since 2001.
Josh Brock, Calpine Energy Solutions, spoke about their current work on various systems testing that
would be required to launch CEA, the company being local and passionate about the importance of serving
the CCA and earning public trust, and the importance of representing a public entity in speaking with
customers.
Gretchen Newsom, IBEW Local 569, requested that Calpine agree to neutrality in the event that their
employees or subcontractor employees decided to unionize in the future, which had not been successful
at SDG&E’s call centers.
Calpine representative said that they had completed neutrality agreements with other vendors and they
were generally be supportive of that activity.
Motion by Chair Shumacher, seconded by Vice Chair Haviland to approve selection of Calpine Energy
Solutions and authorize the Interim CEO to execute an agreement for services for an amount not to exceed
$720,000 per year for a period of five years, subject to General Counsel approval. Motion carried
unanimously 3/0.
Item 5: Authorize Execution of San Diego Gas & Electric Community Choice Aggregation
Service Agreement; Payment of Community Choice Aggregation Bond and Submittal of Draft Customer Notice to California Public Utilities Commission
May 12, 2020 Item #8 Page 114 of 137
RECOMMENDATION
1. Authorize execution of Community Choice Aggregation (CCA) Service Agreement
with San Diego Gas & Electric.
2. Approve CCA Bond, in an amount not to exceed $147,000, to the California Public
Utilities Commission (CPUC), pursuant to CPUC Resolution E-4907.
3. Approve submittal of draft customer notice to California Public Utilities Commission
pursuant to CPUC Resolution E-4907.
Barbara Boswell, Interim CEO, reviewied the report.
Motion by Chair Shumacher, seconded by Vice Chair Haviland to approved execution of Community
Choice Aggregation (CCA) Service Agreement with San Diego Gas & Electric; approve a CCA Bond, in an
amount not to exceed $147,000, to the California Public Utilities Commission (CPUC), pursuant to CPUC
Resolution E-4907; and approve submittal of a draft customer notice to California Public Utilities
Commission pursuant to CPUC Resolution E-4907. Motion carried unanimously 3/0
Item 6: Adopt Resolution Approving Clean Energy Alliance Policies
RECOMMENDATION
Adopt Resolution #2020-### approving Clean Energy Alliance policies relaed to travel
and reimbursement, customer confidentiality and privacy and collections:
1. CEA -001 Travel and Reimbursement Policy
2. CEA-002 Protection of Confidential Information
3. CEA-003 Privacy and Customer Confidentiality Policy
4. CEA-004 Advanced Metering Infrastructure (AMI) Data Security and Privacy Policy
5. CEA-005 – CEA Collections Policy
Barbara Boswell, Interim CEO, reviewied the report and recommend that the title of Resolution CEA-001
be amended to say “A resolution of the board of directors of the clean energy Alliance approving travel
and reimbursement, customer confidentiality and privacy policy.”
Motion by Vice Chair Haviland, seconded by Board Member Becker to approve Resolution CEA-001 Travel
and Reimbursement Policy modifying the amount of a meal expense from ‘should be moderete’ to ‘should
not exceed $30 per meal and associated gratuities should not exceed 20%,’ Resolution CEA-002 Protection
of Confidential Information adding a reference to Board Members, Employees, Agents, etc. to be
specifically referenced, Resolution CEA-003 Privacy and Customer Confidentiality Policy, and Resolution
CEA-004 Advanced Metering Infrastructure (AMI) Data Security and Privacy Policy. Motion carried
unanimously 3/0
CLOSING COMMENTS:
Board Members discussed Board Members receiving copies of all RFQs (Request for Quotes) when an
RFQ is issued and clarification on setting the agenda through the Staff and the CEO or Board Members
submitting requests at the public meeting.
ADJOURN
Chair Schumacher adjourned the meeting at 3:34 p.m.
_______________________________
Angela Ivey, City Clerk of Solana Beach
Interim Acting Board Secretary
May 12, 2020 Item #8 Page 115 of 137
Clean Energy Alliance - Board of Directors
Meeting Minutes
April 16, 2020 - 2 p.m.
Del Mar Civic Center – Town Hall
Remote Participation Only
1050 Camino del Mar, Del Mar CA 92014
CALL TO ORDER: 2 p.m.
ROLL CALL: Schumacher, Haviland, Becker
FLAG SALUTE
Vice Chair Haviland led the Pledge of Allegiance.
PUBLIC COMMENT
Each person wishing to comment to the Board on any matter not on the agenda shall submit a
written comment to the Board Secretary by 1:00 PM the day of the meeting by emailing
cityclerk@delmar.ca.us. Please note “CEA Public Oral” in the subject line of your email. If you
desire to have your comment read into the record at the Board meeting, please indicate so in the
subject line of your email and limit your email to 500 words or less. State law prohibits the Board
from taking action on items not listed on the agenda. Comments requiring follow up will be
referred to staff and, if appropriate, considered at a future Board meeting.
No public comment was received.
BOARD COMMENTS & ANNOUNCEMENTS
None.
PRESENTATIONS
None.
NEW BUSINESS
Item 1: Interim Chief Executive Officer Update
RECOMMENDATION:
1. Receive Community Choice Aggregation Update report from Interim Chief
Executive Officer.
2. Receive Community Choice Aggregation Regulatory Affairs report from
Special Counsel.
Interim Chief Executive Officer Barbara Boswell presented the Community Choice
Aggregation Update report and reviewed a PowerPoint presentation (on file in the
office of the Board Secretary).
May 12, 2020 Item #8 Page 116 of 137
Special Counsel Ty Tosdal presented the Community Choice Aggregation
Regulatory Affairs report and reviewed a PowerPoint presentation (on file in the
office of the Board Secretary).
No public comment on the item was received.
Board discussion focused on public outreach and designating Board and staff
members to coordinate outreach efforts to increase CEA membership.
On a motion by Board Member Becker, seconded by Vice Chair Haviland, to direct
Interim CEO Boswell to return to the board at the next board meeting with an
outreach plan for expansion of the Clean Energy Alliance. Motion carried
unanimously, 3/0.
Item 2: Clean Energy Alliance Draft Financial Pro-Forma Review; FY 20/21 Budget and
Financing Strategy
Clean Energy Alliance (CEA) receive updated financial pro-forma from Pacific
Energy Advisors; discuss FY 20/21 budget and financing strategy.
RECOMMENDATION:
1. Receive report on draft financial pro-forma.
2. Provide direction for FY 20/21 staffing and consulting services and
community outreach/communication and marketing.
3. Provide direction on FY 20/21 budget financing strategy.
Interim Chief Executive Officer Barbara Boswell introduced Kirby Dusel and John
Dalessi of Pacific Energy Advisors who presented on the draft financial pro-forma
and reviewed a PowerPoint presentation (on file in the office of the Board
Secretary).
No public comment on the item was received.
On a motion by Vice Chair Haviland, seconded by Chair Schumacher, to direct staff
to include in the next pro-forma scenarios of 50%, 75% and 100% renewable base
product options and to look at the ability for each city to offer different base
product options for their city. Motion carried unanimously, 3/0.
On a motion by Chair Schumacher, seconded by Board Member Becker, to direct
staff to include in the next pro-forma two additional scenarios: 1) 100% REC 1
renewables at start-up and 2) phasing in of 100% REC 1 renewables by 2023.
Motion carried unanimously, 3/0.
May 12, 2020 Item #8 Page 117 of 137
On a motion by Vice Chair Haviland, seconded by Chair Schumacher, to direct staff
to include in the next pro-forma scenarios that include a 1% discount rate and a
2% rate discount. Motion carried unanimously, 3/0.
On a motion by Chair Schumacher, seconded by Board Member Becker, to direct
staff to return during the FY21 budget discussion with a reserves policy that
includes a 5% annual reserves contribution with a minimum 25% reserves
contribution achieved in the first five years and a future reserves range with 25%
as the minimum and a goal of greater reserves. Motion carried unanimously, 3/0.
On a motion by Board Member Becker, seconded by Vice Chair Haviland provided
direction for FY 20/21 staffing and consulting services to continue with all existing
agreements. Motion carried unanimously, 3/0.
On a motion by Chair Schumacher, seconded by Vice Chair Haviland, to give
Interim Chief Executive Officer Boswell the authority to negotiate financing with
third parties including Calpine Energy Solutions with the understanding that the
Board’s desire is to get the best interest rate possible in order for the Clean Energy
Alliance to be able to repay its member agencies $150,000 advances should they
need it in a more expedient manner. Motion carried unanimously, 3/0.
Item 3: Authorization to Enter into a Contract for Energy Transactions Attorney
Services
RECOMMENDATION:
Authorize the Interim Chief Executive Officer to enter into a contract for energy
transactions attorney services with Hall Energy Law for an amount not to exceed
$100,000 through June 30, 2021, subject to General Counsel approval.
Interim Chief Executive Officer Boswell presented staff’s recommendation to
enter into an agreement for energy transaction attorney services with Hall Energy
Law due to the need for the Clean Energy Alliance to enter into energy supply
contracts which requires specalized legal expertise. Interim Chief Executive
Officer Boswell reviewed a PowerPoint presentation (on file in the office of the
Board Secretary).
No public comment on the item was received.
On a motion by Vice Chair Haviland, seconded by Chair Schumacher, to authorize
the Interim Chief Executive Officer to enter into contract for energy transaction
attorney services for an amount not to exceed $100,000 with a staff
recommendation to coordinate with San Diego Community Power on the
upcoming San Diego Gas & Electric (SDG&E) Resource Adequacy (RA) solicitations
as well as other energy procurements, 3/0.
May 12, 2020 Item #8 Page 118 of 137
Item 4: Clean Energy Alliance Board Schedule Special Meeting for 5-Year Goals & Vision
Workshop
RECOMMENDATION:
Clean Energy Alliance Board schedule special meeting for 5-Year goals & vision
workshop to include CCA programs, economic revitilization opportunities, citizen
advisory committee, strategic plan and inclusive sustainable workforce policy.
On a motion by Chair Schumacher, seconded by Vice Chair Haviland, the board
scheduled the special meeting for May 7, 2020 at 2 p.m. in Carlsbad (or via
teleconference if required). Motion carried unanimously, 3/0.
BOARD MEMBER REQUESTS FOR FUTURE AGENDA ITEMS
None.
ADJOURNMENT:
Chair Schumacher adjourned the duly noticed Meeting at 4:50 p.m.
___________________________
Sarah Krietor, Management Analyst
City of Del Mar
May 12, 2020 Item #8 Page 119 of 137
Staff Report
DATE: May 7, 2020
TO: Clean Energy Alliance Board of Directors
FROM: Barbara Boswell, Interim Chief Executive Officer
ITEM 1: Clean Energy Alliance Financial Pro-Forma Review; 5-Year Goals and Vision Discussion
RECOMMENDATION:
1.Review initial draft of Clean Energy Alliance (CEA) Financial Pro-Forma.
2.Discuss CEA 5-Year Goals and Vision and provide direction regarding CCA program
prioritization that support JPA goals, climate action plan goals, economic development,
local development and support low income.
3.Provide direction to staff regarding a Citizen Advisory Committee Policy.
4.Provide direction to staff regarding a CEA strategic plan.
5.Provide direction to staff regarding an Inclusive Sustainable Workforce Policy.
BACKGROUND AND DISCUSSION:
The Clean Energy Alliance Joint Power Authority was formed by the cities of Carlsbad, Del Mar
and Solana Beach in November 2019 for the purpose of establishing a community choice
aggregation (CCA or CCE) program in their communities.
Recital 3 of the JPA Agreement states:
“The purposes for the Founding Members…entering into this Agreement include
procuring/developing electrical energy for customers in participating jurisdictions, addressing
climate change by reducing energy-related greenhouse gas emissions, promoting electrical rate
price stability and cost savings, and fostering consumer choice and local economic benefits such
as job creation, local energy programs and local power development.”
Recital 6 of the JPA Agreement identifies the following goals of the JPA:
•Provide electricity in a responsible, reliable, innovative and efficient manner;
•Generation rates competitive with San Diego Gas & Electric (SDG&E) with a target 2%
discount below SDG&E’s base electric generation product;
•Offer a mix of energy products that is cleaner that SDG&E’s similar service and other
options including voluntary 90% & 100% products, with the objective of achieving- and
sustaining- the Climate Action Plan goals of the members, at competitive rates;
May 12, 2020 Item #8 Page 120 of 137
• An aggregate electric supply portfolio with overall lower greenhouse gas (GHG)
emissions than SDG&E, and that supports achievement of members’ greenhouse gas
reduction goals and renewable electricity goals;
• An energy portfolio that incorporates energy efficiency and demand response programs
and pursues ambitious energy consumption reduction goals;
• Procurement of local generation of renewable power developed by or within member
jurisdictions with an emphasis on local jobs, where appropriate, without limiting fair and
open competition for projects of programs implemented by the Authority;
• Provide a range of energy product and program options, available to all members and
customers, that best serve their needs, their local communities, and support regional
sustainability efforts;
• Support low-income households having access to special utility rates including California
Alternative Rates for Energy (CARE) and Family Electric Rate Assistance (FERA)
programs;
• Use discretionary program revenues to support the Authority’s long-term financial
viability, enhance customer rate stability, and provide all Parties and their customers
with access to innovative energy programs, projects and services throughout the
jurisdiction of the Authority; and
• Create an administering Authority that seeks to maximize economic benefits and is
financially sustainable, well-managed and responsive to regional and local priorities.
The JPA Agreement identifies specific goals regarding its renewable portfolio standards and
power supply. Section 6.4 establishes the goal of a renewable energy portfolio from 100%
renewable sources, at competitive rates, by no later than 2035. Section 6.5 sets forth a base
energy product with a 50% renewable energy content, but in no event lower than SDG&E’s
base product, with voluntary opt-up product offerings such as 75% or 100% renewable content.
The Climate Action Plans of Carlsbad0F
1, Del Mar 1F
2and Solana Beach 2F
3set the following goals for
their respective cities:
Carlsbad Del Mar Solana Beach
GHG Reduction Target 49% 50% 50%
Target date 2035 2035 2035
GHG Reduction Measures Rooftop Solar;
Energy Efficiency
Retrofits;
Solar water
heater/heat pump
installation;
Rooftop solar;
Energy Efficiency;
CCA Program;
Reduce single
passenger vehicle
trips;
Rooftop Solar;
Energy efficiency
retrofits;
Solar water
heating;
1 City of Carlsbad Climate Action Plan September 2015
2 City of Del Mar Climate Action Plan June 2016
3 City of Solana Beach Climate Action Plan July 2017
May 12, 2020 Item #8 Page 121 of 137
Carlsbad Del Mar Solana Beach
Building
cogeneration;
Commercial
commissioning;
CALGreen building
code;
Increased zero-
emissions vehicle
travel
Transportation
Demand
Management
Citywide
renewable
projects
Water delivery
and conservation
Bicycle and
pedestrian-
friendly streets &
sidewalks;
Improved public
transit service;
Reduce water
consumption;
Water-efficient
landscaping;
Pool covers to
conserve water;
Capture methane
from landfills;
Promote
expanded
recycling
programs
Reduce natural gas
water heating;
CCA Program
The Climate Action Plans are in alignment with regards to GHG reduction targets and timing.
There are also several areas of commonality with the GHG reduction measures including:
supporting rooftop solar (residential and commercial), energy efficiency programs, solar and
electric water heating and increased use of heat pumps, as well as establishing a CCA program.
Clean Energy Alliance Initial Draft Pro Forma
At its April 16, 2020 regular CEA board meeting, the Board reviewed the initial draft of the CEA
CCA financial pro forma. Assumptions that served the basis for the initial draft included a
minimum 50% renewable energy default product increasing to 100% by 2035, no category 3
renewable energy credits, rate parity with SDG&E and a 5% of revenue annual reserve
contribution. With these assumptions, and current energy market conditions, the financial
outlook over the next 5-years is reflected in the following chart:
May 12, 2020 Item #8 Page 122 of 137
At the April 16 Board meeting, several alternative program options and assumptions were
requested to be evaluated with an updated pro forma to come back to the Board. The updated
pro forma with the requested scenarios will be brought before the Board at its May 21, 2020
meeting. The original initial draft pro forma is presented to provide the Board with a basis for
discussion regarding the 5-year goals and vision for CEA.
CCA Programs
The annual net surplus generated by the CCA provide funds and opportunity for
implementation of Board directed CCA programs that address the priorities and goals of CEA as
established by the Board and in the JPA Agreement. Examples of CCA programs, that have been
implemented, or are being implemented by CCAs throughout the State of California are shown
in the below.
$0
$10
$20
$30
$40
$50
$60
$70
$80
FY 20/21 FY 21/22 FY 22/23 FY 23/24 FY 24/25MillionsCEA Initial Draft Pro Forma
Revenue Expenditures Cumulative Res Cum. Net Surplus
May 12, 2020 Item #8 Page 123 of 137
Staff is requesting the Board to prioritize potential CCA programs that CEA will work to
implement over the next 5-years, that support climate action plan measures, economic
development, clean energy, local development and support of low-income goals. With the
current impact of COVID-19 on member agency city economies, CEA has an opportunity to
identify and implement programs that can assist in the economic revitalization efforts.
Citizen Advisory Committee
May 12, 2020 Item #8 Page 124 of 137
Section 5.9 of the JPA Agreement establishes the authority for the Board to establish an
advisory committee to assist the Board in implementing and operating its CCA program.
Pursuant to the JPA Agreement, the committees should have equal representation from the
member agencies. The Board may establish criteria to qualify for appointment to the
committee, establish rules, regulations, policies or procedures to govern the committee.
Citizen Advisory Committees (CAC) have been established by CCAs to provide input to CCA
boards and assist in the decision-making process.
Examples of areas that a CEA CAC may address include:
• Community Outreach
• Development of public information
• Finance and Risk Management
• CEA Expansion
Staff is seeking direction from the Board regarding establishing a CAC policy that addresses
membership criteria, application process, committee purpose and scope.
Strategic Plan
A strategic plan will provide a process of documenting and establishing the direction of CEA,
assessing where CEA is and where CEA is going. It provides a place to record the mission, vision
and values, long-term goals and actions plans that will be used to reach those goals.
Staff is seeking direction from the Board regarding development of a strategic plan for CEA.
Inclusive Sustainable Workforce Policy
Inclusive sustainable workforce policies establish procedures and practices regarding hiring
staff, procurement of goods and services, procurement of energy, and local development.
Attachment A is the Inclusive and Sustainable Workforce Policy from Peninsula Clean Energy, a
CCA program in northern California.
Staff is seeking direction from the Board regarding development of an Inclusive Sustainable
Workforce Policy for CEA.
FISCAL IMPACT
There is no fiscal impact associated with this item.
ATTACHMENTS:
Attachment A – Peninsula Clean Energy Inclusive and Sustainable Workforce Policy
May 12, 2020 Item #8 Page 125 of 137
Policy Number: 10
Original Adoption Date: December 15, 2016
Revised: October 25, 2018
Subject: Inclusive and Sustainable Workforce Policy
Policy: One of PCE’s strategic goals is to “foster a work environment that espouses
sustainable business practices and cultivates a culture of innovation, diversity,
transparency, integrity, and commitment to the organization’s mission and the communities it serves.” PCE recognizes that an inclusive and sustainable workforce helps PCE meet its core mission and goals more effectively, serve its customers in a more culturally sensitive manner, and reflect the businesses we partner with and the community we serve more comprehensively. PCE strives to have a workforce that is as inclusive as the community it serves.
Inclusive Workforce
PCE Staff
PCE relies on its employees to provide clean, cost-effective, alternative energy to its customers. These customers live in diverse communities, and an inclusive workforce comprised of staff who reflect and are invested in these communities allows PCE to serve them more effectively. An inclusive staff also provides good jobs for people from
diverse communities.
To help maintain and strengthen PCE’s inclusive staff, PCE will:
(1)Engage in broad outreach efforts in diverse communities, includingdisadvantaged and low-income communities, to ensure a diverse pool ofcandidates for open positions;
(2)Provide fair compensation that aligns with regional market indicators forcompensation levels for each position;
(3)Be transparent about these practices and lessons learned; and
(4)Provide contact information for staff who can answer questions about thispolicy.
Supply Chain
PCE’s commitment to inclusion also extends to its supply chain. Where and from
whom PCE purchases goods and services have important consequences for businesses, customers, and their communities. An inclusive supply chain is an important driver for successful delivery of PCE’s services to its customers, and of fair and equitable economic development generally.
To help ensure an inclusive supply chain, PCE will:
(1)Strive to use local businesses and provide fair compensation in the purchase
Attachment A
May 12, 2020 Item #8 Page 126 of 137
of services and supplies;
(2) Proactively seek services from local businesses and from businesses that have been Green Business certified and/or are taking steps to protect the environment;
(3) Engage in efforts to reach diverse communities to ensure an inclusive pool of potential suppliers;
(4) Collect information from suppliers and contractors on the inclusivity of their workforce;
(5) Include questions about supplier inclusivity in requests for proposals (RFPs) for services;
(6) Require reporting from developers and large vendors on inclusivity in business ownership and staff;
(7) Be transparent about these practices and lessons learned; and
(8) Provide contact information for staff who can answer questions about this
policy.
Inclusive Business Practices
To fulfill its core mission to provide energy choices to the diverse residents and communities of San Mateo County, PCE must ensure that its services and information are accessible to all communities. Accordingly, PCE will:
(1) Strive to provide information on PCE’s services in the multiple languages commonly spoken in PCE’s service area (including mailers, tabling materials, customer service, call center, workshops and outreach events, advertisements, and other means of customer engagement);
(2) Conduct marketing and outreach in diverse communities (including advertising in minority-owned media, establishing partnerships with community organizations, and using various media, such as radio and television) to increase awareness of PCE’s services and programs;
(3) Strive to attend important multi-cultural community events with multi-lingual materials and speakers;
(4) Share information about activities and initiatives that promote inclusion,
access, and diverse engagement in the community.
Non-Discrimination Pledge
PCE will not discriminate, and will require that its suppliers do not discriminate, on the basis of race, color, national origin, ancestry, age, disability (physical or mental), sex, sexual orientation, gender identity, marital or domestic partner status, religion, political beliefs or affiliation, familial or parental status (including pregnancy), medical condition (cancer-related), military service, or genetic information.
May 12, 2020 Item #8 Page 127 of 137
Sustainable Workforce
Support of local businesses, union labor and apprenticeship and pre-apprenticeship programs that create employment opportunities are important components of building and sustaining healthy and sustainable communities. It is in the interest of Peninsula Clean Energy in San Mateo County (PCE) to provide fair compensation and sustainable workforce
opportunities within a framework of competitive service and the promotion of renewable
energy, energy efficiency and greenhouse gas reduction.
PCE Recognizes the importance of locally-generated renewable energy in assuring that California is provided with (1) adequate supplies of renewable energy for economic growth, (2) sustained local job opportunities and job creation, and (3) effective means to reduce the impacts of greenhouse gas emissions. PCE also recognizes the opportunities that energy efficiency programs provide for local workforce training and employment.
PCE supports fair compensation in direct hiring, renewable development projects, energy
efficiency programs and in procurement of PCE services and supplies. PCE also supports
quality State of California approved apprenticeship and pre-apprenticeship training programs in construction craft occupations to foster long-term, fairly compensated employment opportunities for program graduates and believes that local apprenticeship and pre-apprenticeship programs are an efficient vehicle for delivering quality training in construction
industry craft occupations.
PCE therefore desires to facilitate and accomplish the following objectives:
(1) Support for and direct use of local businesses;
(2) Support for and direct use of union members from multiple trades;
(3) Support for and use of training and State of California approved apprenticeship programs, and pre-apprenticeship programs from within PCE’s service territory; and
(4) Support for and direct use of green and sustainable businesses.
“Local” is defined as 1.) San Mateo County; 2.) Nine Bay Area Counties (Alameda, Contra Costa, Marin, Napa, San Mateo, San Francisco, Santa Clara, Solano, Sonoma); 3.) Northern
California; 4.) California. Preference will be give first to San Mateo County; second, to the
Nine Bay Area Counties; third, to Northern California; fourth, to California.
May 12, 2020 Item #8 Page 128 of 137
PCE will support the objectives stated above in the following ways:
PCE Power Purchase Agreements with Third Parties
PCE shall collect information from respondents to any bidding and/or RFP/RFQ process regarding past, current and/or planned efforts by project developers and their contractors to:
• Employ workers and use businesses from the PCE service territory.
• Employ properly licensed (A, B, C10, C7, C46) contractors and California Certified
electricians.
• Utilize multi-trade project labor agreements on the proposed project or any prior project developments.
• Utilize local apprentices, particularly graduates of local pre-apprenticeship programs.
• Pay workers the correct prevailing wage rates for each craft, classification and type of work performed.
• Display a poster at jobsites informing workers of prevailing wage requirements.
• Provide workers compensation coverage to on-site workers.
• Support and use State of California approved apprenticeship programs.
Relevant information submitted by proposers will be used to evaluate potential workforce impacts of proposed projects with the goal of promoting fair compensation, fair worker treatment, multi-trade collaboration, and support of the existing wage base in local communities where contracted projects will be located.
PCE Owned Generation Projects
Any PCE-owned renewable development project shall use local businesses, union labor, and apprenticeship programs through multi-trade agreements and/or through multiple agreements
for work. Each construction contractor or subcontractor performing work on any PCE-owned project shall use a combination of local labor, union labor and apprenticeship programs, and shall follow fair compensation practices including proper assignment of work to crafts that traditionally perform the work. For each renewable energy project, PCE or its construction
contractor shall require of its regular workforce that at least 50% of all “journey level”
employees shall be graduates of a State of California approved apprenticeship program and at least 20% shall be enrolled and participating in a local State of California approved apprenticeship program. Apprenticeship programs must be approved by the State Department of Apprenticeship Standards.
May 12, 2020 Item #8 Page 129 of 137
PCE Feed-In Tariff Price Projects
PCE shall use best efforts to ensure each construction contractor or subcontractor performing work on any PCE Feed-in Tariff project utilize local businesses, union labor, multi-trade agreement, apprenticeship programs, and fair compensation practices including proper assignment of work to crafts that traditionally perform the work.
PCE Energy Efficiency Projects
PCE shall use best efforts to support local businesses, union labor, and local apprenticeship programs in the implementation of its energy efficiency programs. PCE shall use best efforts
to ensure each construction contractor or subcontractor performing work on any PCE energy
efficiency program utilize local businesses, union labor, local apprenticeship, and fair compensation practices in program implementation including proper assignment of work to crafts that traditionally perform the work.
May 12, 2020 Item #8 Page 130 of 137
Staff Report
DATE: May 7, 2020
TO: Clean Energy Alliance Board of Directors
FROM: Barbara Boswell, Interim Chief Executive Officer
ITEM 1: Clean Energy Alliance Board Policy Regarding Handling of Unsolicited Proposals
RECOMMENDATION:
Provide direction regarding development of an Unsolicited Proposal Policy.
BACKGROUND AND DISCUSSION:
The Clean Energy Alliance (CEA) Joint Powers Authority Agreement identifies the goal of
providing innovative energy programs, projects and services to its customers. Typically, these
programs, projects and services would be sourced through solicitation processes such as
Request for Proposal or Request for Qualifications. However, there may be instances where
public or private sector entities or individuals have an innovative project or idea that they
desire to propose to the Board outside of the normal solicitation processes.
An Unsolicited Proposal Policy establishes procedures and practices regarding how unsolicited
proposals would be submitted and how they would be handled once submitted. Attachment A
is a sample Unsolicited Proposal Policy from SANDAG.
Staff is seeking direction regarding development of an Unsolicited Proposal Policy.
FISCAL IMPACT
There is no fiscal impact associated with this item.
ATTACHMENTS:
Attachment A – SANDAG Unsolicited Proposal Policy
May 12, 2020 Item #8 Page 131 of 137
Board Policy
No.: 040
Unsolicited Proposals and Partnership Requests
SANDAG normally develops its own requirements, solicits proposals or bids, and contracts with entities
whose proposals or bids are deemed most advantageous to SANDAG, however, the Board of Directors
recognizes the valuable, innovative ideas or sources of revenue that educational and nonprofit institutions,
private sector entities, and individuals may bring to propose relevant projects or partnerships that they believe
are within the purview of SANDAG and will help meet SANDAG goals. This policy outlines how SANDAG
staff will process unsolicited proposals to contract with SANDAG as a consultant or contractor, and
partnership requests seeking to work with SANDAG in a public private partnership (P3) or other similar
arrangement.
Scope of Policy
1.1 This policy is intended to provide high-level policy considerations and procedures to guide
SANDAG management decisions when responding to unsolicited proposals and partnership
requests (unsolicited offers). The Board of Directors hereby delegates authority to the
Executive Director to create written procedures and to contract with parties submitting unsolicited
proposals or partnership requests consistent with the requirements of this policy and Board Policy
No. 017: Delegation of Authority.
1.2 An "unsolicited proposal" is defined as a written proposal to perform a proposed task or effort,
initiated and submitted to SANDAG by a prospective consultant or contractor without a
solicitation from SANDAG, with the objective of obtaining a contract award from SANDAG. The
unsolicited proposal is the formal means by which business proposals are brought to the attention
of SANDAG, submitted in the hope that the SANDAG will contract with the offeror for goods or
services.
1.3 An “unsolicited partnership request” is a written request that SANDAG participate in a P3 or
other partnership arrangement. Unlike a consultant or contractor arrangement, a partnership
request calls for the requesting partner(s) to assume responsibility and financial liability for
performing all or a significant number of functions in connection with a project. In transferring
responsibility and risk for multiple project elements to the partner, SANDAG would reduce its
controls and risks regarding the project. Additionally, the partner would receive the opportunity
to earn a financial return or other benefits commensurate with the risks it would assume.
1.4 An “offeror” is the term used in this policy to refer to entities or persons submitting an
unsolicited offer, which may be in the form of an unsolicited proposal or partnership request.
1.5 The following types of correspondence will not be considered under this policy: (1) written
inquiries regarding SANDAG interest in research and/or development areas, (2) proposal
explorations, (3) technical inquiries, (4) research descriptions, (5) offers to sell commercial off-the-
shelf equipment or software, (6) a proposal that overlaps with the scope of work in a pending
competitive procurement, and (7) proposals or requests that would require SANDAG to act
outside SANDAG authority, inconsistently with applicable laws, or outside the purview of the
agency.
Attachment A
May 12, 2020 Item #8 Page 132 of 137
2 Role of SANDAG Staff
2.1 Offerors may engage in preliminary discussions with SANDAG staff to gauge SANDAG interest in
a potential unsolicited proposal or partnership request. Both SANDAG and offeror staff,
however, must exercise caution to ensure that these preliminary communications do not lead to
inadvertent collaboration on the development of a work statement that would subsequently be
incorporated in an unsolicited offer. This would potentially invalidate the unsolicited nature of
the offer or disqualify it from being considered due to concerns about unfair competition.
Discussions between a potential offeror and SANDAG staff other than SANDAG Contracts and
Procurement Division (CPD) staff should be limited to preliminary discussions of general concepts
only. Discussions with non-CPD staff should be used solely to gauge SANDAG potential interest
and determine whether the unsolicited offer would be of interest to SANDAG. If a potential
offeror wishes to pursue the proposal or request after preliminary discussions, SANDAG staff
should refer the offeror to this Board Policy and the CPD.
2.2 In cooperation with the Office of General Counsel, the CPD is responsible for: (1) establishing
contracting policies and procedures consistent with Board Policies and applicable laws that are
needed to address matters unique to unsolicited proposals and partnerships; (2) processing
solicitations and proposals; and (3) processing unsolicited offers. The CPD will endeavor to
ensure prompt and impartial evaluation in all of its function areas.
3 Preparation and Submission of Proposals
3.1 All unsolicited offers submitted for SANDAG consideration should be addressed to:
Contracts and Procurement Division
Attention: Unsolicited Offers
SANDAG
401 B Street, Suite 800
San Diego, CA 92101
unsolicitedoffers@SANDAG.org
An unsolicited offer submitted directly to anyone other than CPD personnel cannot be acted
upon officially until it is submitted to the CPD. If an offer is not sent by email, five copies of each
offer must be delivered to SANDAG, one of which must be a manually signed original.
Unsolicited offers should be prepared in conformance with this policy and any written
procedures developed under the authority of the Executive Director. Offerors may submit their
proposals or requests in their own format as long as the required data are provided. Email
submissions may be made to the email address above, provided a single, manually signed hard
copy is mailed concurrently. All electronic submissions must be in PDF and OCR format.
3.2 An unsolicited offer must meet all of the following requirements in order to be eligible for formal
evaluation: (1) it must be in writing; (2) contain a novel, innovative, or otherwise meritorious
concept, application, approach, or method; (3) be independently originated and developed by
the offeror; (4) be prepared without SANDAG staff supervision or direct SANDAG staff
assistance: and (5) present the proposed work or project in sufficient detail to allow a
determination to be made that SANDAG support could be worthwhile and the proposed work
could enhance, benefit, and provide valuable input to SANDAG mission or responsibilities.
3.3 The following information must be included in unsolicited offers:
3.3.1 Name(s) and address(es) of entity(ies) or persons submitting the offer.
3.3.2 Type(s) of organization(s) (for profit, nonprofit, educational, small business, other)
submitting the offer.
May 12, 2020 Item #8 Page 133 of 137
3.3.3 In the case of participation of other key entities or persons not participating as an
offeror, provide identifying information for such entities or persons.
3.3.4 Names and telephone numbers of the offeror's technical and business personnel whom
SANDAG may contact for evaluation and negotiation purposes.
3.3.5 Identification of whether the offer is intended to be an unsolicited proposal or
unsolicited partnership request.
3.3.6 Identification of any proprietary data that the offeror intends to be used by the agency
only for evaluation purposes. (See Section 3.4 for instructions).
3.3.7 Names of any other Federal, State, local agencies, or other parties receiving the offer.
3.3.8 Date of submission of the offer.
3.3.9 A signature of a responsible official authorized to contractually obligate the offeror.
3.3.10 Technical information, including a concise title and an abstract (approximately
200 words) of the proposed effort or partnership.
3.3.11 A reasonably complete discussion stating the objectives of the project or partnership,
method of approach, the nature and extent of the anticipated results, and the manner
in which the project or partnership will help support the SANDAG mission.
3.3.12 The names and brief background information of the offeror's key personnel who would
be involved.
3.3.13 The type of support, if any, the offeror requests of SANDAG; e.g., financial, facilities,
real property rights, equipment, materials, profit sharing, or personnel resources.
3.3.14 A cost estimate for the proposed contract award, or estimated amount of investment
from offeror and amount, if any, sought from SANDAG. The estimate must be
sufficiently detailed, by element of cost, for meaningful evaluation by SANDAG and
include subcontractors, partners, or any potential private equity contribution the offeror
would provide. Offeror also must provide its estimate of the projected total net value or
cost of the proposal or partnership to SANDAG and offeror over the life of the program,
project, or service.
3.3.15 Period of time for which the offer is valid (minimum of three months).
3.3.16 Proposed schedule.
3.3.17 A statement, if applicable, regarding proposed cost or revenue sharing.
3.3.18 Identification of any organizational conflicts or financial conflicts of interest with
SANDAG, its member agencies, or the members of the Board of Directors.
3.3.19 A brief description of the offeror's organization and previous relevant work or
experience.
3.3.20 A statement demonstrating the financial ability of the offeror to perform the project or
venture.
3.4 Proprietary Data
Whenever possible, an offeror should submit a proposal without restrictions on the use of
technical data provided. All offers shall be public records. The offeror must state whether or not
the proposal contains proprietary information that constitutes a trade secret pursuant to
California Civil Code section 3426.1. If an unsolicited offer includes trade secret data that the
offeror does not want disclosed for any purpose other than evaluation of the offer, the title page
shall be marked with the following legend:
May 12, 2020 Item #8 Page 134 of 137
USE AND DISCLOSURE OF DATA
The trade secret information in this offer shall not be duplicated, used, or disclosed in whole or
in part for any purpose other than to evaluate the offer; provided, that if a contract or
partnership agreement is executed with offeror as a result of or in connection with submission of
this data, SANDAG shall have the right to duplicate, use, or disclose the data to the extent
provided in the contract. This restriction does not limit SANDAG’s right to use information
contained in the data if it is obtainable from another source without restriction. The data
subjected to this restriction are contained in Page(s) [insert page numbers] of the offer.
The offeror also shall mark each restricted page with the following legend:
Use or disclosure of data in sections or paragraphs [insert section or paragraph numbers] on this
page is trade secret and is therefore subject to the restriction on the title page of this offer.
An unsolicited offer will be returned to the offeror if it is marked with a different legend than that provided
in paragraph (a) above. The offeror will be informed that the offer cannot be considered because it is
impracticable for SANDAG to comply with the offeror’s requirements. The offeror shall also be informed,
however, that the offer will be considered if it is resubmitted with the legend provided above.
4 Evaluation of Proposals
4.1 Preliminary Review. Prior to making a Comprehensive Evaluation of a document submitted as an
unsolicited offer, the CPD will determine that the document contains sufficient information to
enable meaningful evaluation. The CPD will notify the potentially interested SANDAG
Department Director(s) and coordinate a preliminary review of the offer. If the Department
Director(s) in his/her/their sole discretion, deems the offer in SANDAG’s best interest to further
evaluate, the CPD will notify the offeror. If the document lacks information required by this
policy or other procedures promulgated by SANDAG the offeror will be notified and given the
opportunity to submit the needed information. The Comprehensive Evaluation cannot begin
until the needed information is received and one or more Department Directors has authorized
the expenditure of the funds within SANDAG’s approved budget to conduct a Comprehensive
Evaluation. If it is determined that the submission does not meet the criteria for Comprehensive
Evaluation as an unsolicited offer, a reply will be sent to the offeror, indicating the reason(s) for
not considering it. SANDAG will endeavor to notify an offeror whether or not its offer will
progress to a Comprehensive Evaluation within 60 days of receipt of the offer. Offerors shall
have neither vested rights in this decision, nor ability to protest a decision by SANDAG not to
conduct a Comprehensive Evaluation.
4.2 Comprehensive Evaluation. Upon acceptance of an unsolicited offer for Comprehensive
Evaluation, CPD will convene a panel of CPD staff and experts to perform an independent
evaluation. The decision as to whether favorable action will be taken on the offer will be based
upon an assessment by the panel of the potential contribution of the proposed project or
partnership arrangement to the objectives of SANDAG and whether the risk and cost to
SANDAG can be justified under the circumstances. SANDAG staff or consultants will conduct
cost, economic or market analyses to evaluate the current and future market conditions and
determine whether the project or partnership arrangement is viable and in the best interest of
SANDAG. The offeror will need to be available to the evaluation team to answer questions and
provide additional information without charge to SANDAG. An offeror must establish it and/or
its team or partners have sufficient technical experience and readiness to proceed.
4.3 Privacy Impacts. SANDAG may determine that an offer involving exchange of data raises public
privacy concerns that require further assessment. SANDAG may require a privacy impact
assessment to occur prior to fully evaluating an offer.
May 12, 2020 Item #8 Page 135 of 137
4.4 If it is determined to be in the best interest of SANDAG, other local, state, or Federal agencies
may be approached to share in the evaluation and consideration of the offer.
4.5 When the Comprehensive Evaluation has been completed, CPD will inform the offeror of the
results of the evaluation. If SANDAG determines the offer is viable and worthy of pursuit in its
sole discretion, it will evaluate whether to utilize Section 5 or 6 of this policy as the next step in
the process.
4.6 Normally, unsolicited offers are not returned after completion of the evaluation. They are
retained in a secure location for a period of time and then destroyed after two years. If the
offeror wishes the offer to be returned, a statement to that effect should be clearly made in the
submission.
5 Determinations Regarding Competitive Process
5.1 SANDAG will determine in its sole discretion whether competition exists from other potential
offerors.
5.2 If SANDAG determines competition may exist, the CPD shall publicly notice the unsolicited offer on
its website and in any other locations directed by SANDAG management, and allow for other
offerors to submit an abbreviated competing proposal within 30 days for consideration by
SANDAG. The public notice shall include the evaluation criteria that SANDAG will use to evaluate
competing offers.
6 Determinations Regarding Whether a Sole Source Contract is Appropriate
6.1 SANDAG will utilize written procedures to evaluate whether a contract award or partnership
agreement can be justified without a competitive process. Such procedures shall be consistent
with SANDAG sole source justification procedures and will be dependent upon the sources of
funding SANDAG would use and the circumstances of each offer.
6.2 The offeror may claim, or it may appear from an offer, that no other entity or person could offer
the same product, service, or partnership arrangement. In the case of software, technology or
other intellectual property, it may appear that only the offeror can perform. These circumstances
alone, however, will not justify a sole source contract. The concept will be evaluated on its own
merit, including analysis of revenue producing potential and opportunities for cost recovery for
the applicable project or program. In many cases, the offeror will have competitors that could
offer SANDAG similar solutions, but with different options, functionality, costs or risks. A
competitive process should be used to select the consultant, contractor or partner, unless
SANDAG staff determines that the proposed concept itself is proprietary, or the proposal
concerns a specific piece of real property with unique attributes essential to SANDAG’s interests
to which the offeror has exclusive ownership and/or negotiating authority.
6.3 The essential consideration in whether or not to accept an unsolicited offer without competition
(i.e., to engage in contract negotiations on a sole source basis) is whether or not the offer is
presenting a proprietary/trade secret concept or real property interest that is itself essential to
contract performance. If an offeror is merely presenting a rationale for doing certain work that
could be done by others if given the chance to compete, then there is no permissible basis to
authorize a sole source. In the case of a proprietary software product that is being offered to
achieve a certain goal, SANDAG could not, for example, release proprietary programming codes
in a competitive solicitation. Staff should, however, if it deems the proposal one it recommends
pursuing, compete the contract award in terms of describing what the mission or goal is in order
to see what other firms might offer in terms of software solutions. In other words, staff cannot
assume that the product being offered in the unsolicited proposal is the only, or best, product
available to meet the objectives of the agency.
May 12, 2020 Item #8 Page 136 of 137
7 Partnership Requests that Include Joint Development Proposals
Offers including proposed joint use and development on SANDAG-developed and/or owned property will
be evaluated using the following additional criteria:
7.1 Whether the project will negatively impact present or future public transportation facilities.
7.2 Whether the project is consistent with regional and local community policies and plans.
7.3 Whether the project demonstrates a fiscal benefit to SANDAG or a public transportation
operator.
7.4 Whether the project provides economic development potential to SANDAG and/or the
community.
7.5 Whether the project increases accessibility to public transportation.
7.6 Whether the project addresses community needs for housing, employment, services, or
recreational facilities.
8 Board of Directors Participation
8.1 As set forth in Board Policy No. 017: Delegation of Authority, the Executive Director and his/her
delegates may enter into agreements not currently incorporated in the budget and make other
modifications to the budget in an amount up to $300,000 per transaction so long as the overall
budget remains in balance. If, in order to act upon an offer, a modification of more than
$300,000 would be necessary, such action shall be brought to the Executive Committee if under
$500,000 or to the Board of Directors for amounts in excess of $500,000 as prescribed by Board
Policy No. 001 Allocation of Responsibilities.
8.2 For all offers that progress to the Comprehensive Evaluation Stage, the Executive Director will report
actions taken to the Board in summary written form at the next regular meeting of the Board.
9 SANDAG Liability
9.1 This policy and the procedures it describes do not commit SANDAG to evaluate an offer within a
certain period of time, execute a contract, or to expend any public funds. SANDAG has no
obligation to reimburse an offeror for any costs it incurs in preparing or submitting an offer or in
providing information to SANDAG as it evaluates an offer.
9.2 All unsolicited offers submitted to SANDAG become the property of SANDAG and public records
and, as such, may be subject to public review and use by SANDAG. Documents protected by law
from public disclosure will not be disclosed by SANDAG if clearly marked as described in
Section 3.4 of this policy. Trade secrets may be marked as confidential only to the extent they meet
the requirements of California Civil Code section 3426.1(d). Only information claimed to be a trade
secret at the time of submittal to SANDAG and marked as required in this policy will be treated as
a trade secret. To the extent that an entire offer is marked as confidential or a trade secret, such
designations will not be effective, and the offer will be rejected. To the extent that an offeror
marks any information as either confidential or a trade secret, the offeror thereby agrees to defend
and indemnify SANDAG in the event that SANDAG’s non-disclosure is challenged in any legal
action. Please see SANDAG Board Policy No. 015: Records Management Policy for information
regarding the treatment of documents designated as confidential by SANDAG.
9.3 Offerors who wish to release information regarding evaluation, selection, or contract awards
information in a press release or its promotional materials prior to the time a public
announcement is made by SANDAG must receive prior written approval from SANDAG.
Adopted: June 28, 2019
May 12, 2020 Item #8 Page 137 of 137
Clean Energy Alliance Update
Jason Haber, Intergovernmental Affairs Director
May 12, 2020
Clean Energy Alliance Update
•Agenda item request per CMC 1.20.060
–Mayor Hall
–CEA update, discussion & direction
•Background
•Implementation status
•Financial projections
•Discussion with CEA Board representatives
2
Background
•October 2019
–Adopted Resolution No. 2019-197
•Approved CEA Joint Powers Agreement
–Appointed Schumacher (primary) & Hall (alternate) to CEA Board of Directors
•November 2019
–Adopted Resolution No. 2019-22
•Accepted peer review of feasibility study
•Authorized $150,000 to fund CEA FY 19-20 Budget
3
Implementation Status
•On track to begin service in May 2021
•Implementation Plan certified by CPUC
•Year -Ahead Resource Adequacy Forecast filed
–JPA withdrawal provisions:
•1 year notice & potential financial obligations
beyond initial advance
•All member agencies remain committed
4
Implementation Status
•Board Chair & Vice Chair
•Interim Board Secretary
•Interim Board Treasurer/CFO
•Interim CEO
•General Counsel
•Regulatory Special Counsel
•Energy Transactions Attorney
•Secured banking services
5
Implementation Status
•Agreements for payment/reimbursement of initial costs
•Established website: www.thecleanenergyalliance.com
•Member agency service agreements
•SDG&E service agreement
•CPUC bond payment
•County BOS approved Conflict of Interest Code
6
Implementation Status
•Adopted Initial Budget
•Travel and Reimbursement Policy
•Protection of Confidential Information Policy
•Privacy and Customer Confidentiality Policy
•Advanced Metering Infrastructure (AMI) Data
Security and Privacy Policy
•Collections Policy
7
Implementation Status
Ongoing:
•5-year Goals & Vision –Strategic Plan
•Financial Pro-Forma Review
•FY 2020-21 Budget
•Citizens Advisory Committee
•Unsolicited Proposals Policy
•Inclusive & Sustainable Workforce Policy
–Consistent with JPA Agreement & State Law
8
Financial Projections
•Base Assumptions
–50% renewable energy default at launch increases to 100% renewable by 2035
–Renewable energy portfolio assumes use of 82% PCC1 and 18% PCC2, which reflects RPS compliance limitations for PCC2 products
–Annual reserve contribution equal to 5% of total projected revenues
–Financing & repayment of initial budget contributions
9
10
Fiscal Year Ending:2020 2021 2022 2023 2024 2025
I. Revenue - 9,533,643 69,970,228 71,333,092 72,718,018 74,125,343
II. Operating Expenses
Power Supply - 8,103,205 58,057,665 59,435,021 60,960,894 61,960,598
Staff 50,000 235,000 600,000 618,000 636,540 655,636
Administrative Costs*253,000 1,105,691 2,444,552 2,495,095 2,555,592 2,614,773
Subtotal Operating Expenses 303,000 9,443,896 61,102,216 62,548,116 64,153,025 65,231,007
Operating Margin (303,000) 89,748 8,868,011 8,784,977 8,564,992 8,894,335
III. Financing
Interest - 97,750 105,686 64,994 23,129 0
Principal - 450,000 1,346,130 1,507,440 1,549,207 131,023
Subtotal Financing - 547,750 1,451,816 1,572,434 1,572,335 131,023
Operating Margin Less Financing (303,000) (458,002) 7,416,196 7,212,543 6,992,657 8,763,312
IV. Cash From Financing 450,000 4,450,000 - - - -
V. Other Uses
CPUC and CAISO Deposits 147,000 500,000 - - - -
Collateral Deposits 0 2,500,000 - - - -
Reserve Additions - 476,682 3,498,511 3,566,655 3,635,901 3,706,267
Subtotal Other Uses 147,000 3,476,682 3,498,511 3,566,655 3,635,901 3,706,267
VI. Net Surplus/(Deficit)- 515,315 3,917,684 3,645,888 3,356,756 5,057,045
VII. Cumulative Reserve - 476,682 3,975,194 7,541,848 11,177,749 14,884,016
VIII. Cumulative Net Surplus - 515,315 4,433,000 8,078,888 11,435,644 16,492,689
* Comprised of Technical and Legal Services, Customer Outreach and Communications, Utility Services Fees, Data Management Services, Uncollectibles
* includes
financing of
initial
advances @
2% interest
Draft Financial Pro Forma
Financial Projections
•Additional Scenarios & Portfolio Options
–100% PCC1 renewable at launch
–100% PCC1 by 2023
–2% rate discount & 1% rate discount
–50% renewable/75% carbon free option
–75% renewable energy option*
–100% renewable energy option
11
Draft Projected Net Surplus & Sensitivities
12
Projected Net Surplus and 1% Discount Scenarios
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$-
2021 2022
-Base Case Net Surplus
-1% Discount with No PCC2
2023 2024 2025
-1% Discount
-1% Discount with PCC2 Phase Out
Projected Net Surplus and 2% Discount Scenarios
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$-
2021 2022
-Base Case Net Surplus
-2% Discount with No PCC2
2023 2024 2025
-2%Discount
-2% Discount with PCC2 Phase Out
Other Portfolio Options
13
Options
50% Renewable/75% GHG Free
(Carbon Free) Default
Voluntary 100% Renewable
Option
Affect on Rate
Discount/Rate Premium
1% decrease in rate discount
$.0075/kWh
~ $2.80 per month for
average residential usage
Notes
Reduction in rate discount
covers incremental cost of
GHG-free product
Rate is set to cover
incremental cost of increase
to 100% renewable
Advising CEA Board representatives
•City Council may advise and provide feedback
–Cannot direct CEA Board representatives
•Key City Council decisions per CEA Agreement:
–Liability firewall
–Selection of default power supply product
–Directing discretionary revenues
–Membership withdrawal
14
Questions & Discussion
15