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CITY COUNCIL AGENDA REPORT
City of Anaheim
PUBLIC UTILITIES DEPARTMENT
DATE: JULY 14, 2026
FROM: PUBLIC UTILITIES DEPARTMENT
SUBJECT: AGREEMENT WITH SIEMENS INDUSTRY, INC. FOR
WHOLESALE ENERGY RISK MANAGEMENT QUANTITATIVE
MODELING SERVICES
ATTACHMENT (Y/N): YES ITEM # 12
GOVERNMENT CODE § 84308 APPLIES: NO
RECOMMENDATION:
That the City Council, by Motion:
1. Approve an agreement with Siemens Industry, Inc. (Siemens) for wholesale energy risk management quantitative modeling services (Agreement), with an initial term of two years and a one-year optional extension, with an aggregate not-to-exceed cost of $188,754, plus a 15% contingency for as- needed services; and
2. Authorize the Public Utilities General Manager, or designee(s), on behalf of the City of Anaheim (Anaheim), to execute the Agreement and any related or implementing documents, including any cost-neutral amendments, assignments, and any documents contemplated by the Agreement, and to take such necessary or advisable actions to implement, fund, and administer the Agreement.
DISCUSSION:
At its meeting on June 24, 2026, the Public Utilities Board recommended that the City Council approve the Agreement with Siemens Industry, Inc.
Anaheim Public Utilities (APU) buys and sells energy in the wholesale energy market operated by the California Independent System Operator (CAISO) to recover costs to keep customer rates affordable. As a market participant, APU maintains a comprehensive risk management framework that was previously developed in 2006, consistent with generally accepted industry standards at that time. APU seeks consulting services to review and develop an updated quantitative model to address changes that have occurred in the wholesale market over the past 20 years.
The utility industry implemented wholesale energy regulations following the California Energy Crisis of 2000 to restrict speculative energy trading and protect Agreement with Siemens Industry, Inc. for Wholesale Energy Risk Management Quantitative Modeling Services July 14, 2026
customers from volatile energy prices. Over time, the wholesale energy market has expanded to include other states and market participants, as well as sustainable resources such solar, wind, and battery systems to meet California renewable energy policies. APU’s wholesale energy practices have allowed for excess energy to be sold into the market so the proceeds offset power supply costs. Similarly, purchasing power when market conditions are favorable have helped to keep customer rates affordable. Energy risk management relies on data-based modeling and guidelines for APU’s interaction in the wholesale market.
In March 2026, APU issued a Request for Proposal (RFP) seeking the services of a risk management consultant with proven experience with public power utilities to benchmark APU’s existing models against industry best practices. The consultant will provide new or updated quantitative risk analysis models with detailed program parameters, and APU staff will maintain and update these models going forward.
The specific risk categories include power supply financial exposure, natural gas pricing volatility, and large-scale battery risks.
Forty-two firms downloaded the RFP for review, and eight firms submitted proposals. The top three firms were invited for interviews. The proposals were evaluated in accordance with Council Policy 4.1 for the ability to meet the full scope of services, experience and industry expertise, quality controls, and overall pricing, and the firms were ranked after the interview as follows:
Firm Rank
Siemens Industry, Inc. 1
Ascend Analytics 2
Baringa Partners LP 3
Based on the results of the RFP evaluation, overall proposal, panel interview, and cost, Siemens is recommended as the highest-rated firm. Siemens demonstrated a comprehensive approach to successfully deliver consulting services for all tasks listed on the scope of work. Additionally, Siemens has performed similar wholesale energy and natural gas services for the Los Angeles Department of Water and Power.
The Agreement is for an initial term of two-years and one optional one-year extension. The not-to-exceed amount is $188,754 for the term of the Agreement, plus a 15% contingency for as-needed services.
IMPACT ON BUDGET:
Sufficient funds are included in APU’s Fiscal Year 2026/27 restricted Electric Utility Fund budget, and future years are subject to City Council approval of budget appropriations.
Agreement with Siemens Industry, Inc. for Wholesale Energy Risk Management Quantitative Modeling Services July 14, 2026
Respectfully submitted,
Dukku Lee
Public Utilities General Manager
Attachment:
1. Agreement with Siemens Industry, Inc. for Wholesale Energy Risk Management Quantitative Modeling Services