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HomeMy WebLinkAbout2021-01-12; City Council; ; Clean Energy Alliance Power Supply Product Offerings and Input to the City’s Board RepresentativeCA Review CKM Meeting Date: To: From: Staff Contact: Subject: Districts: Jan. 12, 2021 Mayor and City Council Scott Chadwick, City Manager Jason Haber, Intergovernmental Affairs Director jason.haber@carlsbadca.gov, 760-434-2958 Clean Energy Alliance Power Supply Product Offerings and Input to the City’s Board Representative Citywide Recommended Action Provide input to the city’s Clean Energy Alliance board representative regarding the alliance’s power supply product offerings. Executive Summary At its regular meeting on December 17, 2020, the Clean Energy Alliance Board of Directors considered potential default power supply products to be made available for member agencies to select from. The alliance board also considered potential power supply products to allow individual customers to either opt up to have more of their energy come from renewable sources or opt down for potentially lower costs. These products are: •Green Impact - 50% renewable energy •Solana Energy Alliance product match - 50% renewable energy and 75% carbon-free energy •Clean Impact - 100% renewable energy •Local Impact – A voluntary opt-down product set to meet minimum state renewable requirements The alliance board asked members to return to their respective city councils for input on the power supply product offerings under consideration. The input is to be reported back to the alliance board at its Jan. 21, 2021, meeting. Discussion Background The City Council approved the joint powers agreement creating the Clean Energy Alliance on Oct. 8, 2019 (Resolution 2019-197). The alliance is a new regional community choice aggregation program that enables the city and its partners to purchase power from alternative suppliers while still receiving the power through their existing utility provider. Community Jan. 12, 2021 Item #7 Page 1 of 3 choice aggregation provides for more local control over electricity sources and the potential to choose greener power sources and lower electricity prices. The alliance’s member agencies are the cities of Carlsbad, Solana Beach and Del Mar. It is scheduled to launch in May - June 2021. The City Council appointed Councilmember Schumacher as the primary board representative on the Clean Energy Alliance Board of Directors and Mayor Hall as the alternate. Power supply product offerings The joint powers authority agreement establishes that the alliance’s base, that is, the default, power supply product will be greater than or equal to 50% qualified renewable resources (Section 6.5 - Power Supply Requirements). The agreement further states that the board shall establish product options with higher renewable and/or greenhouse gas-free content that each member agency may select as its default energy product for its community. In addition to establishing the available default power supply offerings for its member agencies to choose from, the Clean Energy Alliance board may establish other product offerings that individual customers may voluntarily select as their power supply. Before it can set power rates, the alliance must determine the power supply products it will offer for member agencies to select as their default, as well as alternative product offerings for individual customers to choose from. Staff anticipates that the alliance will set rates at its February 18, 2021, board meeting and that each member agency will subsequently select the default power supply product for its community. The choices are: Green Impact - 50% renewable energy product Under the terms of the agreement, the Green Impact product offering, with a minimum 50% renewable energy, is the option with the minimum amount of renewable energy that a member agency may select as the default product offering for its community. If a member agency selects the Clean Impact 100% Renewable Energy product as its default, the Green Impact product would be available to individual customers to opt down to. Solana Energy Alliance product match - 50% renewable energy and 75% carbon-free energy The Solana Energy Alliance, Solana Beach’s existing community choice aggregation program, is to be incorporated into the Clean Energy Alliance. The Clean Energy Alliance board also discussed the possibility of providing an offering that meets Solana Energy’s current default power supply mix of 50% renewable and 75% carbon-free energy. Clean Impact - 100% renewable energy product This 100% renewable energy product would be available as an alternative default power supply offering for member agencies. Individual customers served by agencies that choose the Green Impact option as the default power supply can opt-up to Clean Impact. The Clean Impact power supply product will cost more than Green Impact due to the additional expense of procuring the power supply with more renewable energy. Jan. 12, 2021 Item #7 Page 2 of 3 Local Impact – Minimum State Required Renewable Energy Product The Clean Energy Alliance’s board is considering offering the Local Impact product offering as a voluntary opt-down offering for qualifying customers to choose from. This product would not be available for a member agency to select as its default power supply but it would be available to individual customers that meet certain criteria. For residential customers, the criteria the board is considering is eligibility for a low-income qualified rate discount program such as California Alternate Rates for Energy or Family Electric Rate Assistance. The alliance will determine the specific eligibility criteria for small businesses as part of the rate-setting process, should the alliance board elect to offer this alternative power supply option. The Local Impact power supply product would be priced at a lower rate compared to Green Impact to reflect the lower cost of the power supply with less renewable energy. Fiscal Analysis In keeping with the joint powers authority agreement, the City of Carlsbad, as well as Del Mar and Solana Beach, each contributed a $150,000 advance to the Clean Energy Alliance to fund its initial start-up costs. The advance is to be repaid within three years of that the alliance commences service. The alliance has secured financing for its remaining start-up implementation and cash flow needs through a line of credit from JPMorgan. JPMorgan has indicated it will consider early repayment of the start-up advances from the member agencies. Carlsbad has no other financial commitment to the Clean Energy Alliance, and there is no financial impact incurred as a result of this action. 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) This action does not constitute a “project” within the meaning of the California Environmental Quality Act under California Public Resources Code Section 21065 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 Public notice of this item was posted in keeping with the Ralph M. Brown Act and it was available for public viewing and review at least 72 hours before the scheduled meeting date. Exhibits None. Jan. 12, 2021 Item #7 Page 3 of 3 Tammy Cloud-McMinn From: Micah Mitrosky Sent: Tuesday, January 12, 2021 12:27 PM To: City Clerk Cc: Gretchen Newsom; Jeremy Abrams All Receive -Agenda Item ii~ For the Information of the: CITY COUNCIL Dated/ ;)/;J,J CA ......----cc~ CM ..::::_-ACM ~CM (3) ~- Subject: IBEW 569 Public Comment -Item 7 CEA Product Offerings Dear Mayor Hall and Members of the City Council: I am submitting these comments on behalf of IBEW Local ·s69 regarding potential Clean Energy Alliance Product Offerings. We support the minimum 50% renewable and 100% renewable products. Revenue generated from the premium in the 100% product can be set aside in a fund dedicated to local programs and projects in the service territory. Local investments linked with job quality standards and community benefits agreements, prioritizing communities of concern, can bring much-needed economic and environmental benefits to communities most in need . It is concerning to see a proposal for a Minimum State Renewable Portfolio Standards product. In the December staff report, CEAstaff noted this is 36% in 2021 increasing to 39% in 2022. This is less than SDG&E's current renewable energy portfolio which currently stands at roughly 45% and is the wrong direction for our region and our climate. It is also concerning to see a proposal for a 75% carbon-free product. Carbon-free can include nuclear or large hydroelectric resources. Prioritizing local renewable energy projects here in our region that are truly clean and renewable will maximize local job creation and economic benefits. We urge you to reject the Minimum State Renewable Portfolio Standards product and the 75% carbon-free product and move forward with the 50% and 100% product offerings as referenced above. Thank you for your consideration. Micah Mitrosky Environmental Organizer IBEW 569 CAUTION: Do not open attachments or click on links unless you reco nize the sender and know the content i safe. 1 Tammy Cloud-McMinn From: Sent: · To: Subject: Mike McMahon Tuesday, January 12, 2021 1 :59 PM City Clerk All Receive -Agenda Item# _2_ For the Information of the: CITY COUNCIL Date I/);;_/ 1/ CA v--CC.....'.'.'.'.:. LIO, _!_J&CIOI .J2.... Mhl l~l ...!....... item #7 -Clean Energy Alliance Power Supply Product Offerings and input to the City's Board Representative Honorable Mayor and City Council, Our Clean Energy Alliance (CEA) has been formed because our community recognizes and wants to be at the forefront in reducing greenhouse gasses and the devastating impact climate change is having on our world. While we know we need to move to 100% clean energy, the initial offerings of CEA's energy portfolio should NEVER fall below a 50% renewable content, which closely matches SDG&E's rate of 45%. The proposal for a renewable content to be offered at less than 50 to low income families is essentially asking these community members to choose between cleaner air and saving money. Aid to struggling community members should be provided by state incentives and other programs and not by CEA rates. Adding this low rate of renewable content is going against all the intents of Community Choice Energy. Thank you, Mike McMahon Carlsbad, 92010 CAUTION: Do not open attachments or click on links unless ou reco nize the sender and know the content i safe. 1 Presentation to Carlsbad City Council Power Supply Product Offerings January 12, 2021 Input Requested from Member Agencies •Should CEA offer 100% Renewable Power Supply as a default product for Member Agencies to select for their community? •Should CEA offer a Power Supply Product that meets State renewable portfolio standards as an option opt-down product for individual customers to select? Background •Community Choice Aggregation (CCA) programs typically offer: •A default power supply that all customers within a Member Agency are automatically enrolled in •Alternative power supply products that Member Agencies may choose their customers to be automatically enrolled in •Optional power supply products that individual customers may select –either to opt-up or to opt-down depending on the default power supply their community has selected CEA Authorization •Section 6.5 of CEA JPA Agreement •Base default power supply product shall be >= 50% renewable •Board shall establish optional default power supply products with higher renewable and/or Greenhouse Gas Free content •CEA Board may also offer other optional power supply products or programs that are available to individual customers (not as default options for Member Agencies) Power Supply Options Under Consideration by CEA Board •Clean Impact -50% Renewable Energy Power Supply as default •Green Impact -100% Renewable Power Supply •Alternative for Member Agencies to select as default for their community •Also available for individual customers to select to opt-up to in those communities that default is 50% renewable •Rate at a premium compared to 50% renewable •Alternative 50% renewable/75% GHG-Free •Solana Energy Alliance’s current default Power Supply Options Under Consideration by CEA Board (cont.) •Local Impact –Meets state required minimum renewable standards •36% in 2021 •Increasing annually to 60% by 2030 pursuant to SB 100 •Available to individual customers that meet criteria established by Board •Customer enrolled in California Alternate Rates for Energy and Family Electric Rate Assistance Programs (CARE/FERA) •Small Business customers •Specific criteria to developed based on Board direction •Rate at a discount compared to 50% renewable product CARE/FERA Program •Programs to assist qualified residents based on income •Administered by SDG&E –Discount provided on delivery side of bill •CARE Discount –up to 30% off electric bill •FERA Discount –up to 18% off electric bill •Customer must participate in certain public assistance programs or meet certain income guidelines •Customers enrolled in only one of above programs depending on qualifications Local Impact Considerations NOTE: This is on an account basis and does not reflect percentage of energy usage. Distributed by SDG&E as a bill insert December 2020 Next Steps •January 21, 2021 •Feedback from City Councils brought to CEA Board •CEA Board to approve power supply product options •February 28, 2021 •CEA Board to set rates •March 2021 •CEA member agencies select default power supply Questions/Discussion