Staff Report Item 13
Staff Report Item 13
TO: Ava Community Energy Authority Board of Directors
FROM: Jim Dorrance, Power Resources Manager
SUBJECT: SunZia Wind Project Expansion
DATE: November 15, 2023
__________________________________________________________________ Recommendation
Adopt a Resolution authorizing the Chief Executive Officer to execute an amendment to an Agreement with contracting entity SunZia Wind PowerCo, LLC expanding the size of the SunZia Wind Project to 250 MW.
Background
The 2023 Long-Term Resource Request for Offers (RFO) is Ava Community Energy’s (Ava) fourth long-term contract solicitation. The RFO was launched in March 2023. The RFO is seeking several hundred megawatts (MW) of contracts with renewable energy and battery storage projects with a preference for projects located in California, and more preferentially, those located in Alameda or San Joaquin County.
Ava’s objective is to drive investments in new renewable and energy storage projects within our jurisdiction and throughout California, while securing affordable resources to manage future power price risk. Ava is currently evaluating the responses and negotiating agreements with some of the offer submittals. Ava administered the RFO and completed analysis using internal tools and the cQuant valuation platform to calculate the net present value of proposed projects and determine the optimal portfolio to meet the objectives of the RFO. All of these contracts will be used to hedge Ava against price fluctuation in the California Independent System Operator (CAISO) energy markets and they will contribute to procurement mandates issued by the California Public Utilities Commission (CPUC).
At the October 2023 Board of Directors (Board) Meeting staff presented the first of several projects from the 2023 RFO to the Board to authorize the Chief Executive Officer to execute an Agreement for the SunZia Wind Project (“Project”), which was approved. Ava was later presented with the opportunity Staff Report Item 13
to potentially increase the project size from the 150 MW that was originally presented to the Board to a larger 250 MW slice of the larger project. The Project contract is for a 15-year agreement and would require Board approval to increase the size to a 250 MW share of the overall 3,515 MW RFO project, an increase of 100 MW from the 150 MW approved for the Project by the Board at the October Board Meeting. The Project is located in New Mexico and will provide renewable wind energy and Resource Adequacy to the state of California with an expected online date in September of 2026. The Project will provide renewable energy for Ava customers, reliability to the California grid from the Project capacity through Resource Adequacy and the energy will benefit Ava as a hedge against price changes in the CAISO energy markets. During Ava’s contract term, the Project may be financially restructured into two separate wind farms. If this happens, Ava’s contract would be assigned and turned into two separate agreements containing the same terms as those in the original document.
Attachment
A. Resolution Authorizing the Chief Executive Officer to Execute an Amendment to an Agreement with Contracting Entity SunZia Wind PowerCo, LLC Expanding the Size of the SunZia Wind Project
B. Presentation
Attachment Staff Report Item 13A
RESOLUTION NO. R-2023-XX
A RESOLUTION OF THE BOARD OF DIRECTORS
OF THE AVA COMMUNITY ENERGY AUTHORITY AUTHORIZING THE CHIEF EXECUTIVE
OFFICER TO EXECUTE AN AMENDMENT TO AN AGREEMENT WITH CONTRACTING
ENTITY SUNZIA WIND POWERCO, LLC EXPANDING THE SIZE OF THE SUNZIA WIND PROJECT TO 250 MW
WHEREAS The Ava Community Energy Authority (“Ava”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, Under the Joint Exercise of Power Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of Ava and parties to the JPA in March of 2020. The City of Stockton, located in San Joaquin County was added as a member of Ava and party to the JPA in September of 2022. The City of Lathrop, located in San Joaquin County, was added as a member to Ava and party to the JPA in October of 2023. On October 24, 2023, the Authority legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception.
WHEREAS Ava issued the 2023 Long-Term Resources Request For Offers (RFO) in March 2023;
WHEREAS at the October 18th, 2023, Board of Directors Meeting the Chief Executive Officer (CEO) was authorized to execute an Agreement for 150 MW of wind, which may later be assigned into two Agreements, with contracting entity SunZia Wind PowerCo, LLC for the SunZia Wind Project (“Project”); WHEREAS the Project is expected to be operational by September 30, 2026, and will provide renewable wind energy and associated environmental attributes and Resource Adequacy for the term of fifteen years; and
WHEREAS Ava was offered another 100 MW from the larger project to increase the Ava Project size to 250 MW from the 150 MW that was approved by the Board.
NOW, THEREFORE, THE BOARD OF DIRECTORS OF AVA COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:
Attachment Staff Report Item 13A
Section 1. The CEO is hereby authorized to execute an amendment to an Agreement with contracting entity SunZia Wind PowerCo, LLC expanding the size of the SunZia Wind Project to 250 MW.
ADOPTED AND APPROVED this 15th day of November, 2023.
Elisa Márquez, Chair
ATTEST:
Adrian Bankhead, Clerk of the Board
2023 Long-Term
Resource RFO:
Overview & Update
November 15, 2023
Attachment Staff Report Item 13B
Agenda
•
•
•
•
•
•
Attachment Staff Report Item 13B
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Solicitation Overview
Attachment Staff Report Item 13B
Solicitation Overview – Eligible Products
Attachment Staff Report Item 13B
Evaluation Process
•
▪
▪
•
•
▪
▪
▪
•
•
•
•
•
▪
▪
Attachment Staff Report Item 13B
Challenges in the Marketplace
•
•
•
•
•
Attachment Staff Report Item 13B
Overview of Planned Procurement
•
▪
▪
•
Attachment Staff Report Item 13B
Status of Negotiations
•
•
▪
•
Attachment Staff Report Item 13B
Projects Proposedfor Execution
•
Attachment Staff Report Item 13B
Pattern Energy Project Details
•
•
•
•
•
•
•
•
•
Attachment Staff Report Item 13B
Pattern Energy – Company Overview
•
•
•
–
–
–
–
–
Attachment Staff Report Item 13B
Next Steps
•
•
•
•
Attachment Staff Report Item 13B
Portfolio Summary
Attachment Staff Report Item 13B
Attachment Staff Report Item 13B