HomeMy WebLinkAbout2020-06-18; Clean Energy Alliance JPA; MinutesClean Energy Alliance - Board of Directors
Meeting Minutes
June 18, 2020- 2:00 p.m.
Carlsbad City Hall — City Council Chamber
1200 Carlsbad Village Drive, Carlsbad, CA 92008
CALL TO ORDER: 2 p.m.
ROLL CALL: Schumacher, Haviland, Becker
FLAG SALUTE: Chair Schumacher led the pledge of allegiance.
PUBLIC COMMENT: None.
In conformance with the Brown Act and California Executive Order No. N-29-20, 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. The Secretary will read comments as requested up to three (3) minutes.
In conformance with the Brown Act, no Board action can occur on these items.
BOARD COMMENTS & ANNOUNCEMENTS: None.
PRESENTATIONS: None.
APPROVAL OF MINUTES: None.
CONSENT CALENDAR
The items listed under Consent Calendar are considered routine and will be enacted by one motion as
listed below. There will be no separate discussion on these items prior to the time the Board votes on
the motion unless members of the Board, the Chief Executive Officer, or the public request specific
items be discussed and/or removed from the Consent Calendar for separate action. A request from the
public to discuss an item must be submitted to the Board Secretary in writing prior to the Board
consideration of the Consent Calendar.
Motion by Board Member Becker, seconded by Vice Chair Haviland, to approve Consent Calendar Item
Nos. 1 and 2. Motion carried unanimously, 3/0.
Item 1: Clean Energy Alliance Treasurer's Report
RECOMMENDATION
Receive and file Clean Energy Alliance Treasurer's Report.
Item 2: Clean Energy Alliance Meeting Schedule
RECOMMENDATION
Adoption of Resolution No., 2020-003, setting the Time and Place for Clean Energy
Alliance Board Meetings July 2020 —June 2021.
June 18, 2020 1
NEW BUSINESS
Item 3: Administrative, Operational and Regulatory Affairs Update
RECOMMENDATION
1) Receive and File Community Choice Aggregation Update Report from Interim CEO.
2) Receive Community Choice Aggregation Regulatory Affairs Report from Special
Counsel and Discuss San Diego Gas & Electric 2021 Energy Resource Recovery
Account Rate Application.
3) Approve collaborating with San Diego Community Power (SDCP) for the purpose of
participating in the 2021 San Diego Gas & Electric ERRA proceeding and engaging
NewGen to provide analytical support, for an amount not to exceed $28,358, which
represents 50% of the estimated cost. Authorize the Interim Executive Director to
sign all documents related to the partnership with SDCP, subject to General Counsel
approval.
Interim Chief Executive Officer Barbara Boswell and Ty Tosdal, CEA regulatory Special Counsel,
presented the staff report and reviewed the PowerPoint presentation (on file in the Office of the Board
Secretary).
In response to an inquiry from Board Member Becker, Mr. Tosdal stated that the generation rates
presented were preliminary and it was important to get further analysis to understand what they are
now and determine what they will be later in the process in November when additional data is supplied
and SDG&E is required to serve supplemental testimony.
In response to an inquiry from Chair Schumacher, Mr. Tosdal explained that the type of work involved is
technical in nature, and requires a high level of utility accounting and quantitative analysis. He added
that his firm has retained these types of experts in other cases and worked with them in regulatory
proceedings.
In response to an inquiry from Vice Chair Haviland, Mr. Tosdal said the final data and PICA charges will
not be released until early November and at that time we will know what PICA rate SDG&E is actually
proposing going forward for 2021.
In response to an inquiry from Chair Schumacher regarding staff Recommendation No. 3, Interim CEO
Boswell responded that not all technical consultants conduct this type of work because of the
nondisclosure agreements that are required to be filed with the utlities. She added that the JPA should
engage a company whether it is within the current team of consultants or someone else, to look at: the
power charge and difference adjustments of PCIA; analyzing that refunds from over-collections of
SDG&E from 2018 are bundled to customers through their generation rates and included as an element
of the PICA to Carlsbad and Del Mar customers; and to review other assumptions with regards to costs
and expectations in terms of those costs ensuring that they are consistent with the current
methodology.
Chair Schumacher stated she would be interested to know if any of the CEA's current consultants have
the technical expertise to do this type of work before moving forward with a new contract.
June 18, 2020 2
Consultants Kirby Dusel and John Dalessi with Pacific Energy Advisors, stated that providing the type of
technical expertise the board is seeking, affords complications as their firm is considered market
participants due to the core services they provide. They would be quite limited in trying to analyze and
evaluate those proceedings as they are unable to see or have access to the confidential data that is
needed to assess the regulatory filings. Mr. Dusel and Mr. Dalessi suggested the board consider a
specialized firm that is not in the market and is able to sign a nondisclosure agreement to view the
confidential data.
In response to an inquiry from Board Member Becker, Mr. Tosdal emphasized the retention of a
consultant sooner rather than later to assist with analyzing the proposals from SDG&E or other utilities
in the ERRA proceeding.
In response to an inquiry from Chair Schumacher, Mr. Tosdal explained his firm touched base with other
companies, but did not conduct a formal review or proposal submission process. He added that his firm
requested a proposal from NewGen, as their rates are competitive with other analysts with the same
level of experience, education and expertise.
Vice Chair Haviland requested that staff ask San Diego Community Power (SDCP) to assume more of this
expense in future partnerships in general as it will be receiving more benefit from this than CEA due to
the size of their base.
In response to an inquiry from Chair Schumacher, Greg Stepanicich, General Counsel, explained the
board has the discretion to approve the agreement without going through an RFP process and approval
could be authorized today. He added that the only question is what direction the board wanted to give
to the Interim CEO with regards to negotiating a change in the cost sharing amount of the NewGen
agreement with SDCP.
Motion by Board Member Becker, seconded by Chair Schumacher, authorizing that the agreement with
NewGen be entered into provided that there is a program of sharing of costs based on the size of each
entitity with SDCP, and if SDCP does not approve, this item would return to the board for a decision.
Motion carried unanimously. 3/0.
Item 4: Approve Membership in WSPP, Inc for Purposes of Energy Procurement Transactions,
Execution of Agreement and Payment of Membership Dues
RECOMMENDATION
1) Approve membership in WSPP, Inc for purposes of energy procurement
transactions, authorize Interim Chief Executive Officer to execute WSPP agreement
and payment of $25,000 one-time membership dues.
2) Designate a representative and an alternate to serve on the WSPP Executive and
Operating Committees.
Interim CEO Boswell presented the staff report and reviewed the PowerPoint presentation (on file in the
Office of the Board Secretary).
In response to an inquiry from Vice Chair Haviland, Interim CEO Boswell stated if an agency is precluded
from participating, it would not result in the loss of the agency's membership status.
June 18, 2020 3
In response to an inquiry from Board Member Becker, Ms. Boswell explained the WSPP agreement has
been streamlined with pre-determined terms and conditions that all members agree to which also
streamlines the process of entering into transactions. There are frequently suppliers of energy products
that do require the use of the WSPP agreement. The membership fee is a one-time fee.
Motion by Board Member Becker, seconded by Vice Chair Haviland, to approve membership in WSPP,
Inc for the purposes of energy procurement transactions, authorize the Interim Chief Executive Officer
to execute the WSPP agreement and payment of $25,000 one-time membership dues, and nomination
of Solana Beach Assistant City Manager Dan King to serve as representative and Carlsbad
Intergovernmental Affairs Director Jason Haber to serve as alternate on the WSPP Executive and
Operating Committees. Motion carried unanimously. 3/0.
Item 5: Clean Energy Alliance Fiscal Year 20/21 Financing Plan
RECOMMENDATION
1) Authorize Interim Chief Executive Officer and Interim Treasurer to work with the
member agencies to determine if there is an opportunity for one or all to provide
security requirements for the River City Bank credit option and if a solution is
identified return to Board for approval. Direct staff to return for final approval to
finalize the agreements with River City Bank, Calpine and the provider of the credit
security should one be identified.
2) Should a solution for the security requirements for the River City Bank credit option
not be identified approve selection of JP Morgan to provide $4.5M credit solution
and authorize Interim Chief Executive Officer to submit documents, complete due
diligence requirements and execute loan agreements with JP Morgan, subject to
General Counsel approval.
Interim CEO Boswell presented the staff report and reviewed the PowerPoint presentation (on file in the
Office of the Board Secretary).
Vice Chair Haviland asked what the impact adding new members would be to this loan.
Rosa Cucicea, representing River City Bank, replied that the addition of new members to some of their
existing CCA borrowers resulted in no covenants being added.
Allyson Goetschius, representing JP Morgan, stated it did not have an impact other than resulting in an
incremental financing need which is something they could entertain.
In response to an inquiry from Board Member Becker regarding the covenant restrictions of JP Morgan,
Interim CEO Boswell explained that having those covenants should market conditions be at a point
where generation rates by SDG&E have decreased or PCI has increased and the board would like to use
funding available in its reserves to continue to offer a discount and cover any shortfalls or net deficits, it
may be precluded from being able to do so with these covenants.
Mr. Stepanicich confirmed an inquiry from Chair Schumacher that a level of discount offered by the
board could be jeopardized by the covenant's restrictions from JP Morgan.
Rosa Cucicea, representing River City Bank, added the bank has never had to call on a guarantee with
other CCAs. Some JPA members' cities prefer to sign the papers that they are a guarantor while others
June 18, 2020 4
preferred to post a cash collateral that River City Bank maintains in an interest-bearing account. The
guarantor or cash collateral is required for a nonrevolving line of credit which is essentially the seed
capital pre revenue or pre-launch.
Carlsbad Intergovernmental Affairs Director Jason Haber and Solana Beach Assistant City Manager Dan
King confirmed an inquiry from Chair Schumacher that the decision of a guarantor position would be a
decision of each of their city councils.
In response to an inquiry from Chair Schumacher regarding a hard deadline for funding for Fiscal Year
20/21 expenses, Interim CEO Boswell replied that staff would be looking for direction from the board at
its July meeting to begin the process to execute loan documents which should be finalized by the end of
August.
Motion by Board Member Becker, seconded by Chair Schumacher, authorizing the Interim Chief
Executive Officer and Interim Treasurer to work with the member agencies to determine if there is an
opportunity for one or all to provide security requirements for the River City Bank credit option and if a
solution is identified return to Board for approval. Also, to direct staff to return for final approval to
finalize the agreements with River City Bank, Calpine and the provider of the credit security should one
be identified. Motion carried unanimously. 3/0.
Item 6: Approve Clean Energy Alliance Fiscal Year 20/21 Budget
RECOMMENDATION
Approve Clean Energy Alliance Fiscal Year 20/21 Budget.
Interim CEO Boswell presented the staff report and reviewed the PowerPoint presentation (on file in the
Office of the Board Secretary).
Motion by Vice Chair Haviland, seconded by Board Member Becker, approving the Clean Energy Alliance
Fiscal Year 20/21 Budget. Motion carried unanimously. 3/0.
Item 7: Clean Energy Alliance Citizen Advisory Committee Purpose, Scope and Application
Process
RECOMMENDATION
Review and provide input to draft Clean Energy Alliance Citizen Advisory Committee
Purpose, Scope and Application Process.
Interim CEO Boswell presented the staff report and reviewed the PowerPoint presentation (on file in the
Office of the Board Secretary).
Vice Chair Haviland requested to see:
• consistency on eligibility requirements with the policy and application
• budget implications of starting this committee as it is not in the budget
• references required as part of the process
Interim CEO Boswell explained that the application does have a section asking to provide information
about special training or experience, and staff can add a references section. Budget implications would
consist of any staff support needed with meetings of the advisory committee. The board has the
June 18, 2020 5
discretion whether it would like to hire someone specific or have the CEA-hired board secretary also
assist with the citizen advisory committee. Ms. Boswell estimated a cost of approximately $2,000 based
on 8-10 hours of staff time per month for citizen advisory committee duties. She further added it was
intended that residents as determined in the proposed criteria to be the property owner and/or a renter
to allow renters to be eligible.
In response to an inquiry from Board Member Becker regarding the timing of the citizen advisory
committee, Interim CEO Boswell said it is at the board's discretion. If the board wishes the committee to
assist with customer outreach and public information strategy the board would want to be looking at
having the committee seated towards late summer. The board and committee should be working on
developing that strategy with a May 20-21 launch estimated, as communication efforts should begin
approximately six months or so prior.
Chair Schumacher suggested the citizen advisory committee should be composed from the people from
the community rather than the committee being used as a technical advisory board only.
The Board Secretary read the public comments received from the following individuals into the record:
Paige DeCino, with Carlsbad MyGen Sierra Club, suggested a name for the Citizen Advisory Committee
and asked the board to consider incorporating some of the Peninsula Clean Energy's objectives.
Micah Mitrosky representing 1BEW Local 569, supported the recommendations of Paige DeCino and
Carlsbad MyGen Sierra Club.
The board concurred to review the membership criteria, purpose and scope and member selection
process of the policy. Board members agreed to the following:
▪ Committee shall consist of two appointees from each CEA member agency.
• Committee members shall serve staggered three-year terms.
• Committee term limits will consist of only two terms.
• Committee members serve at the pleasure of the board.
• Committee members are subject to all applicable conflict of interest laws
• Committee members should be residents, property owners and/or renters or business
owners within the service territory.
The board concurred to remove the statement "Priority given to those with relevant background or
experience in the energy sector, energy development, public education/outreach and assistance with
social equity and perspective of underrepresented community" from the policy.
Board members agreed to add language about relevant background or expertise in electricity,
community outreach or engagement, or policy advocacy.
The board further agreed:
• Meetings will be held quarterly, and committee members will be subject to dismissal if
25% or two meetings in a row are missed with an unexcused absence.
• The board will determine committee meeting times and locations.
• Committee will elect a chair who will facilitate meetings and provide reports to the board
as needed.
June 18, 2020 6
Discussion ensued among board members regarding the scope and purpose of the Citizen Advisory
Committee.
General Counsel Stepanicich stated the concept of having an annual workplan provided by the board
made it clear the committee would work on those items that are specified in the workplan that the
board approves on an annual basis and that the committee needs to report back to the board. He added
it was helpful to have a statement of purpose, so people know what they are getting into when
appointed to the committee.
The board agreed with Mr. Stepanicich's suggestion that he and staff take the input provided during the
June 18 CEA meeting and draft a Clean Energy Alliance Citizen Advisory Committee Policy for formal
adoption at the board's July meeting.
Chair Schumacher with the board's concurrence, also requested a timeline to-launch the committee
along with the draft policy language, be brought to the board for consideration at the July meeting.
Chair Schumacher further asked that a references section, a restatement of the purpose of the
committee and its objectives along with the requirement to file a conflict of interest statement be
added to the application.
Item 8: Clean Energy Alliance Long-Term Renewable Solicitation
RECOMMENDATION
Receive report and discuss Clean Energy Alliance Long-Term Renewable Energy
Solicitation.
Consultant Kirby Dusel from Pacific Energy Advisors presented the report and reviewed the PowerPoint
presentation (on file in the Office of the Board Secretary).
Chair Schumacher asked if the Request for Proposals (RFP) would be brought back before the board
before being issued.
Interim CEO Boswell replied RFPs are publicly available and are posted to the website. She added that
previously, the board had given direction to move forward with other RFPs; and this item is on the
agenda to discuss the RFP requirements and evaluation criteria. Staff can bring the RFP back if that is
the board's desire but that has not been the process, nonetheless this is our first energy solicitation.
In response to an inquiry from Chair Schumacher, Mr. Dusel stated that SDCP agendized this item for a
June 25, 2020 meeting.
Chair Schumacher asked how the evaluative criteria would play into the RFP.
Mr. Dusel replied that usually a list is provided and occasionally with that list are waiting factors
explicitly tagged to each one of those criteria on the list. He added that the board might consider
staying at a high level and not list the criteria with detail regarding numbers as it eliminates the
potential for gaming among the respondents.
Chair Schumacher questioned what would happen if both agencies choose the same proposal.
June 18, 2020 7
Mr. Dusel explained that when CCA organizations join to conduct solicitations, an agreement is reached
before or at the time of proposal evaluation for splitting up proposals that are of interest to both
parties. This can be done several different ways, it can be 50-50, it could be a different ratio of the
board's choosing, and there may be instances where a proposal is of interest to CEA but not to SDCP. In
those cases, CEA could carry on with an independent negotiation without SDCP participation. It creates
the opportunity for joint participation in projects as well as independent participation depending on
where CEA interests lie.
The Board Secretary read the public comment received from the following individual into the record:
Phillip Watts asked if Pacific Energy Partners was able to compare pricing of electricity generated locally
or transmitted over long distances.
Vice Chair Haviland asked about the recommendation that CEA work jointly with SDCP, if there were
enough cost savings or benefits or both to take on the added complexity,
Mr. Dusel replied that what CEA gains in efficiency does outweigh the potential coordinated burden.
General Council Stepanicich clarified Chair Schumacher's request for a potential joint JPA meeting with
CEA and SDCP, stating that with other agencies conducting joint solicitations, each of their boards act
separately. In his experience, a joint meeting has never been held. Staff and legal counsel work together,
but the actual decision as to what contract is entered into is made by the individual boards. When there
is a successful joint solicitation and an agreement on a joint contract to enter into, each agency enters
into its own contract that divides up the power being purchased.
Chair Schumacher stated she agreed with the concept of an ad-hoc contract committee and wanted to
forward that for this board's consideration. She added she wanted to ensure that the REP returns to the
board for public review prior to it being issued.
In response to an inquiry from Vice Chair Haviland regarding reviewing the REP before it is sent out, Mr.
Dusel responded that an "industry standard" REP template is being used for these sorts of products.
Another approach would be a more editorial process which would neccesitate some increased
coordination with SDCP. He added that he was appreciative of the fact that the board wanted to review
and potentially provide input, but getting the REP out soon lines up very very well with the timeline
required to evaluate a short list, negotiate contracts and execute the contracts to meet the needs of
CEA's launch. Mr. Dusel further explained that when these documents have been prepared by
consultants who have supported CCAs in this effort, they are boilerplate documents that are well
defined in the sense that the definitions are applicable as laid out in California's renewable portfoilo
standards programs.
Board Member Becker stated she felt the board hired the right technical consoultants for the REP. She
was comfortable not reviewing the document and dis want the opportunity to partner with SDCP. She
added that this was the first opportunity and there will be more opportunities for long term
solicitations. Ms. Becker explained that she believed CEA did have to move forward at this time
partnering with SDCP, and was also comfortable with the key evaluation criteria. She further added she
wanted to be an advocate for taking a conservative approach and would like to keep all options on the
table for the first couple of years as CEA builds up its reserves. Ms. Becker said she was happy to
consider criteria as CEA goes along but wanted to count on CEA's experts for this initial procurement for
the longterm.
June 18, 2020 8
Vice Chair Haviland stated she felt the relationship with SDCP was really important to CEA's ability to
control costs, liked the idea of working together, and it would be beneficial to have a communication
line between the two JPAs. She added she thought CEA could have an aggressive REP and reach out to
the SDCP to see if they were interested in the creation of an ad-hoc committee.
In response to an inquiry from Chair Schumacher, General Counsel Stepanicich explained that the board
could hold a special meeting. He added that CEA could only appoint one member to an ad-hoc
committee due to limitations of the Brown Act as appointing two members would require the meeting
to be held publicly.
Motion by Chair Schumacher, seconded by Vice Chair Haviland to consider the establishment of an ad
hoc contract committee of the CEA, to reach out to SDCP on joint partnership solicitation, and not to
issue an REP, to be placed on a future CEA board special meeting agenda for discussion. Motion carried
unanimously. 3/0.
Motion by Chair Schumacher, seconded by Vice Chair Haviland, to hold a timely special meeting based
upon the schedule presented, to discuss the ad hoc contract committee related to joing solicitation with
SDCP. Motion carried unanimously. 3/0.
Motion by Board Member Becker, seconded by Chair Schumacher, directing CEA staff to move forward
with participation in the SDG&E RPS solicitation and that if authorization is needed, the item would
come back before the board. Motion carried unanimously. 3/0.
Item 9: Clean Energy Alliance Resource Adequacy Procurement
RECOMMENDATION
Authorize Interim Chief Executive Officer to execute agreements for resource adequacy
procurement, subject to Special Counsel approval.
At the request of Board Member Becker, the board concurred to continue Item No. 9 to the next Special
CEA Board meeting.
BOARD MEMBER REQUESTS FOR FUTURE AGENDA ITEMS
None.
ADJOURN: Chair Schumacher adjourned the duly noticed meeting at 5:23 p.m.
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Sherry Freisinger, CMC
June 18, 2020 9