Agenda packet — Ava Community Energy Executive Committee, May 1, 2024

Executive Committee Meeting
Wednesday, May 1, 2024
9:00 am
In Person:

Conference Room 5
Ava Community Energy
(formally East Bay Community Energy)
1999 Harrison St., Suite 2300
Oakland, CA 94612
Or from the following remote location:
• Member Marquez – 24301 Southland Drive, Suite 101 Hayward, CA 94545 • Member Hu – Dublin City Hall - 100 Civic Plaza, Dublin, CA 94568 Via Zoom:
https://us02web.zoom.us/j/88267670367
Or join by phone:

Dial(for higher quality, dial a number based on your current location):

US: +1 669 900 6833 or +1 253 215 8782 or +1 346 248 7799 or +1 301 715 8592 or +1 312 626 6799 or 877 853 5257 (Toll Free) or 888 475 4499 (Toll Free) Webinar ID: 882 676 70367
Meetings are accessible to people with disabilities. Individuals who need special assistance or a disability-related modification or accommodation to participate in this meeting, or who have a disability and wish to request an alternative format for the meeting materials, should contact the Clerk of the Board at least 2 working days before the meeting at (510) 906- 0491 or [email protected].

If you have anything that you wish to be distributed to the Executive Committee, please email it to the clerk by 5:00 pm the day prior to the meeting.

1. Welcome & Roll Call

2. Public Comment
This item is reserved for persons wishing to address the Executive Committee on any Ava Community Energy-related matters that are not otherwise on this meeting agenda. Public comments on matters listed on the agenda shall be heard at the time the matter is called.

As with all public comment, members of the public who wish to address the Committee are customarily limited to three minutes per speaker and must complete an electronic speaker Ava Community Energy
Executive Committee Page | 2
slip. The Executive Committee Chair may increase or decrease the time allotted to each speaker.

3. Approval of Minutes from March 6, 2024

4. Draft Budget Review (Informational Item)
Review the draft budget for the 2024/25 fiscal year

5. Power Source Disclosure Program Annual Report (PSDR) Attestation vs. Audit Overview (Informational Item)
Overview of the attestation and audit options for the PSDR filing.

6. Committee Member and Staff Announcements including requests to place items on future Executive Committee Agenda

7. Adjourn
The next Executive Committee meeting will be held on Wednesday, June 5, 2024.

Draft Minutes
Executive Committee Meeting
Wednesday, March 6, 2024
9:00 am
In Person:

Conference Room 5
Ava Community Energy
(formally East Bay Community Energy)
1999 Harrison St., Suite 2300
Oakland, CA 94612
Or from the following remote location:
• Member Hu - Dublin City Hall - 100 Civic Plaza, Dublin, CA 94568 Via Zoom:
https://us02web.zoom.us/j/88267670367
Or join by phone:

Dial(for higher quality, dial a number based on your current location):

If you have anything that you wish to be distributed to the Executive Committee, please email it to the clerk by 5:00 pm the day prior to the meeting.

1. Welcome & Roll Call

Present: Members: Marquez (Alameda County), Hu (Dublin), Member Balch (Pleasanton) and Chair Tiedemann (Albany),
Not Present: Member Kalb (Oakland)
Member Hu joined the meeting at 9:04pm.

Ava Community Energy
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2. (3:45) Selection of Executive Committee Chair (Action Item) Chair Balch motioned for Member Tiedemann to become Chair. Member Marquez seconded the motion which passed 3/0/2:

Yes: Members Marquez, Member Tiedemann and Chair Balch
Not Present: Members Hu and Kalb
Member Balch passed the gavel to Chair Tiedemann.

3. Public Comment
This item is reserved for persons wishing to address the Executive Committee on any Ava Community Energy-related matters that are not otherwise on this meeting agenda. Public comments on matters listed on the agenda shall be heard at the time the matter is called.

As with all public comment, members of the public who wish to address the Committee are customarily limited to three minutes per speaker and must complete an electronic speaker slip. The Executive Committee Chair may increase or decrease the time allotted to each speaker.
(4:47) Public Comment – Jessica Tovar from the Local Clean Power Alliance (LCPA) spoke about a letter titled “Need for Community Driven Resilience Hubs for Environmental Justice Communities:”1, submitted by LCPA to the Executive Committee in January 2024 and again in March 2024. This letter requested that Ava invest $15 million into community resilience hubs and to prioritize environmental justice, low-income and BIPOC communities for site selection.

Member Hu joined the meeting at 9:04am.

4. (6:56) Approval of Minutes from February 7, 2024
Member Balch motioned to approve the minutes. Member Marquez seconded the motion which passed 4/0/1:

Yes: Members Hu, Marquez, Balch and Chair Tiedemann
Not Present: Member Kalb

5. (7:57) Recommendation for Timing of Customer Enrollment for Stockton and Lathrop (Informational Item)
Present recommendation to board for when we should enroll new customers in 2025 Annie Henderson presented a recommendation for the enrollment timing of Stockton and Lathrop customers into Ava Community Energy. After evaluating financial impacts, customer considerations and operational complexities, she suggested April 2025 as the start date for both commercial and residential customers.

Member Marquez asked about the number of new customers affected by the enrollment plan. Annie Henderson responding that the total, encompassing both commercial and residential customers, is approximately 110,000.
1 This letter is available on the March 6, 2024 Ava Executive Committee public meetings page at https://avaenergy.org/meetings/executive-committee-meeting-3-6-24/, Ava Community Energy
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(10:18) Member Balch asked about the initial plans for Stockton's earlier enrollment and the perceived accelerated timing for Lathrop. Annie Henderson stated that Stockton's delay was due to additional information requested by the CPUC, whereas Lathrop followed the standard CPUC timeline and was approved for a January 2025 start alongside Stockton. Alex DiGiorgio added that the issues leading to Stockton's delay had been resolved and no further delays are anticipated for either community. (12:11) Chair Tiedemann asked about the possible negative fiscal impact of starting enrollment in January. Howard Chang explained that winter months typically see higher power usage and prices, which tend to result in financial losses. Howard also said that starting in April would allow for costs to be covered more effectively as the year progresses.
(12:46) Public Comment - Jessica Tovar spoke in support of enrolling Stockton and Lathrop into Ava Community Energy.
(14:45) Member Hu suggested further research into different enrollment times.

6. (15:40) Default Rate Product Change Policy Amendments (Informational Item) Adjust policy to single annual deadline.

Alex DiGiorgio presented proposed amendments aiming to streamline the process for member jurisdictions to change the default rate product to Renewable 100 for their constituents. The amendments suggest reducing board approval and implementation opportunities to once a year with a proposed implementation in either January or March. (19:23) Member Marquez asked about the scope of the policy, specifically whether it was designed for cities aiming to opt up to Renewable 100. She also asked about the number of cities already using Renewable 100 as the default. Member Marquez spoke in support of a March implementation date.
(20:11) Member Balch asked the implications of budget constraints on member cities and the importance of aligning Ava's operations with member jurisdictions’ fiscal planning and climate action goals. He spoke in support of standardizing deadlines and for taking the fiscal years of member jurisdictions into consideration. (31:15) Chair Tiedemann focused on the strategic aspect of when and how changes are implemented to ensure that they align with member jurisdictions' goals and Ava's operational capabilities. He noted the importance of making the switch to Renewable 100, regardless of the exact timing, and said that he was comfortable with a start date in March.

7. (36:47) Resilience Hubs and Solar + Storage Incentive Update (Informational Item) Update about resilience hubs and solar + storage incentives.

JP Ross, Vice President of Local Development, spoke about strategies to support community resilience hubs and the associated Solar + Storage Incentive program. He outlined a strategy comprising of community investment grants, technical assistance, and Ava Community Energy
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an incentive program. A significant aspect of this strategy involves a $300,000 grant to collaborate with local community-based organizations to define resilience hubs, identify best practices, and facilitate community engagement. He also spoke about an associated Technical Assistance program that aims to guide initial design and site considerations for resilience hubs, and the Solar + Storage Incentive program. He also explained how the Solar + Storage Incentive program has specific allocations for low-income residential customers.
(47:52) Member Marquez asked about the number of $300,000 grants that will be awarded. She also questioned the rationale behind the 50% funding split for low-income and market rate sectors and asked about strategies to ensure the geographic equity of the Solar + Storage Incentive program. JP Ross responded that initially, one $300,000 grant is planned, with flexibility to award additional grants based on the value of the proposals. He stated that geographic equity considerations have not been fully addressed. He also stated that the current focus of the program is on budget allocation flexibility between low-income and market-rate incentives. (50:19) Member Balch expressed concerns about the minimum grant amounts and asked how small-scale grants would be managed. He spoke about the need to partner with the solar industry to implement the program effectively, and he raised concerns about potential barriers to deploying resilience hubs and solar + storage systems.

JP Ross responded that the Community Innovation Grant program aims for larger, multi-year grants. He stated that partnerships with the solar industry are essential for educating contractors about the program, and he discussed addressing potential barriers to deployment through education, technical assistance, and partnerships with equipment manufacturers and installers.
(1:07:44) Member Hu spoke about the management challenges associated with grant programs. She said that there is a need for more discussions about program management and, perhaps, additional program managers to oversee its implementation. (1:10:35) Public Comment – Bradley Cleveland suggested reallocating additional funds towards resilience hubs. He also spoke about the opportunity provided by the Federal Direct Pay program to significantly enhance initial investments through tax credits. He stated that the Federal Direct Pay program could lower costs by taking advantage of tax credits for green energy projects.
(1:13:10) Public Comment – Jessica Tovar spoke in support of an immediate increase in grant funding. She also criticized the centralization of funds into a single organization and stressed the need for a broader reach across communities. She called for more collaborative efforts and support in the planning stages of resilience projects. (1:16:24) Member Balch asked for staff to determine the best way to split funding to create the most significant impact. He suggested that staff should make adjustments based on program effectiveness rather than fixed amounts. Member Balch also stressed the importance of ensuring that partners, such as solar installers, are well-informed and aligned with Ava's standards.

Ava Community Energy
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(1:19:15) Member Marquez stated that clear communication and educational efforts are needed for new board members to understand the complex issues that are addressed in this presentation.

Member Marquez also asked for staff to revisit public comments from this meeting in order to explore opportunities to leverage federal funding opportunities. (1:22:35) Howard Chang noted the challenges of transitioning from NEM 2.0 to NEM 3.0 and the impact of the program on the economics of solar installations. He spoke about the need for a flexible approach to the incentive program to adapt to these challenges and to ensure that the program supports Ava's goals of enhancing resilience and reliability.

8. (1:28:30) Committee Member and Staff Announcements including requests to place items on future Executive Committee Agenda
• Member Balch requested information on Ava's budget timeline and process to facilitate discussions on allocations.
• Member Balch stated that as Ava transitions into its next phase, it might be beneficial to evaluate its governance structure to ensure that it is aligned with its operational and strategic goals. He proposed considering if the current subcommittees are appropriate for Ava's current needs.
• Member Balch asked about the possibility of board members periodically choosing or alternating their subcommittee assignments. He suggested this might be a topic for discussion at the full Board of Directors. • Member Marquez requested an updated roster with new members and committee assignments.

9. Adjourned at 10:31am.

The next Executive Committee meeting will be held on Wednesday, April 3, 2024.

Fiscal Year 2024-2025
Draft Budget
Executive Committee
May 1, 2024
Background & Discussion
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How Ava Works—Energy Delivery
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How Ava Works—Revenues & Rates
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0.16 2019 2020 2021 2022 2023 2024 2025
$/kWh
Fiscal Year
Customer Rate Revenue Profile
Ava Average Rates PCIA Fees Cost of Service Margin
How Ava Works—Billing Cycle
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How Ava Works—Revenues & Rates
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50%
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100%
0 1,000,000
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2022 2023 2024 2025
BC%
Retail MWh
Bright Choice as Percent of Retail Load by Year
BC-Res BC-C&I R100-Res R100-C&I BC%
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Executive Budget Summary
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Summary Draft Budget Fiscal Year 2024-2025
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FY 2025 FY 2024 FY FY FY 2024
BUDGET BUDGET Delta %D ACTUALS

OPERATING ACTIVITY

REVENUE & OTHER SOURCES
Electricity Sales 979,017,000 957,028,000 21,989,000 2.2% 927,102,000 Uncollectables (9,790,000) (12,095,000) 2,305,000 -23.5% (11,675,000) Other Operating Revenue (6,487,000) (6,642,000) 155,000 -2.4% 8,446,000 TOTAL OPERATING REVENUE 962,740,000 938,291,000 24,449,000 2.5% 923,873,000

EXPENSES & OTHER USES
Cost of Energy 753,523,000 682,367,000 71,156,000 9.4% 658,262,000 Cost of Energy Services 11,608,000 11,219,000 389,000 3.4% 11,213,000 Total Energy Operating Expenses 765,131,000 693,586,000 71,545,000 9.4% 669,475,000 Total Overhead Operating Expenses 45,015,000 39,299,000 5,716,000 12.7% 29,727,000 TOTAL OPERATING EXPENSES 810,146,000 732,885,000 77,261,000 9.5% 699,202,000 NET OPERATING POSITION 152,594,000 205,406,000 (52,812,000) -34.6% 224,671,000

NON-OPERATING ACTIVITY
TOTAL NON-OPERATING REVENUE 11,449,000 1,728,000 9,721,000 84.9% 8,488,000 TOTAL NON-OPERATING EXPENSES 25,196,000 27,650,000 (2,454,000) -9.7% 26,450,000 NET NON-OPERATING POSITION (13,747,000) (25,922,000) 12,175,000 -88.6% (17,962,000) TOTAL REVENUES 974,189,000 940,019,000 34,170,000 3.5% 932,361,000 TOTAL EXPENSES 835,342,000 760,535,000 74,807,000 9.0% 725,652,000 TOTAL NET REVENUES 138,847,000 179,484,000 (40,637,000) -29.3% 206,709,000 Draft Budget Base Case Assumptions
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Carbon Free Procurement Schedule
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Year Path Target Increase Updated Target Increase Updated Target Increase Updated Target 2022 63% 5% 68% -- -- -- --
2023 66% 5% 71% 5% 76% -- --
2024 71% 0% 71% 10% 81% 0% 81%
2025 76% 0% 76% 0% 76% 5% 81%
2026 81% 0% 81% 0% 81% 0% 81%
2022 2023 2024
Reserve Amounts & Proposed Surplus Allocations
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Contribution Year Contribution Withdraws Balance OpEx to Cover PctOps 2018-2019 40,513,687 - 40,513,687 410,686,000 9.9%
2019-2020 49,704,640 - 90,218,327 383,045,000 23.6%
2020-2021 - - 90,218,327 471,897,000 19.1%
2021-2022 65,655,073 - 155,873,400 562,667,000 27.7%
2022-2023 75,000,000 - 230,873,400 732,885,000 31.5%
2023-2024 100,000,000 - 330,873,400 810,146,000 40.8%
2024-2025* 100,000,000 - 430,873,400 1,003,221,000 42.9% *Proposed contribution with projected operating expenses to cover as of 4/25/2024

WATERFALL DISTRIBUTION
Net Revenues 138,847,000
Working Capital 0
Reserve Contribution 100,000,000
Available for Allocation 38,847,000
On-Bill Credit 50% 19,423,500
Solar/Storage NBT Incentives 50% 19,423,500
Draft Budget: Operating Revenues
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BUDGET BUDGET Delta %D ACTUALS

OPERATING ACTIVITY

EXPENSES & OTHER USES
Cost of Energy 753,523,000 90.2%
Cost of Energy Services 11,608,000 1.4%
Total Energy Operating Expenses 765,131,000 91.6%
Overhead Operating Expenses
Personnel 26,592,000 3.2%
Marketing & Communications 6,168,000 0.7%
Legal, Policy, & Regulatory Affairs 4,104,000 0.5%
Other Professional Services 2,088,000 0.2%
General & Administrative 5,664,000 0.7%
Depreciation 399,000 0.0%
Total Overhead Operating Expenses 45,015,000 5.4%
TOTAL OPERATING EXPENSES 810,146,000

NON-OPERATING EXPENSES
Borrowing Interest 2,796,000 0.3%
Local Development Funding 22,400,000 2.7%
TOTAL NON-OPERATING EXPENSES 25,196,000 3.0%
TOTAL EXPENSES 835,342,000
Draft Budget: Energy Expenses
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FY 2025 FY 2024 FY 2024

BUDGET BUDGET ACTUALS

EXPENSES & OTHER USES
Cost of Energy 753,523,000 682,367,000 658,262,000
Cost of Energy Services 11,608,000 11,219,000 11,213,000 Total Energy Operating Expenses 765,131,000 693,586,000 669,475,000 PPAs Hedges Open Capacity RECs Carbon Free
FY 2025 Budget to FY 2024 Actuals by Cost Element
FY 2025 FY 2024
Draft Budget: Overhead Expenses
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BUDGET BUDGET ACTUALS

EXPENSES & OTHER USES
Overhead Operating Expenses
Personnel 26,592,000 21,911,000 18,015,000
Marketing & Communications 6,168,000 5,303,000 3,046,000 Legal, Policy, & Regulatory Affairs 4,104,000 3,509,000 2,175,000 Other Professional Services 2,088,000 2,505,000 1,790,000 General & Administrative 5,664,000 5,711,000 4,488,000
Depreciation 399,000 360,000 213,000
Total Overhead Operating Expenses 45,015,000 39,299,000 29,727,000 Draft Budget: Personnel
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DRAFT BUDGET BUDGET BUDGET

PERSONNEL
Salaries & Wages 19,765,000 16,587,000 11,598,000
Retirement 2,450,000 2,058,000 1,544,000
Health Care/Benefits 3,955,000 2,913,000 2,292,000
Payroll Expenses 416,000 353,000 277,000
Total 26,586,000 21,911,000 15,711,000
Draft Budget: Non-Operating Activity
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BUDGET BUDGET ACTUALS

NON-OPERATING ACTIVITY

NON-OPERATING REVENUE
Interest Income 11,400,000 1,680,000 7,762,000
Grants 0 0 677,000
Other Non-Operating Revenue 49,000 48,000 49,000
TOTAL NON-OPERATING REVENUE 11,449,000 1,728,000 8,488,000

NON-OPERATING EXPENSES
Borrowing Interest 2,796,000 1,650,000 950,000
Local Development Funding 22,400,000 25,500,000 25,500,000 TOTAL NON-OPERATING EXPENSES 25,196,000 27,650,000 26,450,000 NET NON-OPERATING POSITION (13,747,000) (25,922,000) (17,962,000) Draft Budget: Local Development
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FY 2025 FY 2024

DRAFT BUDGET BUDGET

LOCAL DEVELOPMENT
Critical Municipal Facilities 7,000,000 -
Health-e-Communities 5,000,000 5,000,000
DCFC Network 3,000,000 3,600,000
Ava e-Bike 2,000,000 2,000,000
Building Electrification 2,000,000 3,500,000
Community Grants 1,200,000 1,400,000
Vehicle Electrification 1,000,000 6,000,000
Legal Expense 500,000 -
Solar + Storage 500,000 2,000,000
Subscription 200,000 -
Demand Response - 2,000,000
Total 22,400,000 25,500,000
Potential to S+S* 19,423,000 22,683,000
Estimated with Surplus 41,823,000 48,183,000
*Estimated amounts from surplus net revenues waterfall allocations Thank you!
Power Source
Disclosure Report:

Self-Attestation and
Audit Overview
Agenda

1. Regulatory Background

2. What is the Power Source Disclosure (PSDR)
Program

3. How is the PSDR Filing Prepared

4. Auditing and Verification

5. Options for Compliance
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Regulatory Background
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What is the PSDR Program?
How the PSDR Filing is Prepared
Auditing and Verification
1 Options for Compliance
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Questions?
Adrian Bankhead <[email protected]>
Public Comment for Executive Board Meeting, May 1, 2024 Audrey Ichinose <[email protected]> Wed, May 1, 2024 at 10:35 AM To: Adrian Bankhead <[email protected]>
Cc: Jessica Tovar <[email protected]>, Barbara Stebbins <[email protected]> Hi, Adrian.

I could not connect via Zoom with the information provided in the meeting announcement sent via email or at the Ava website.

So could you please circulate the following comment I had hoped to make to the members of the Board, CAC and staff?
Thank you very much!
Audrey Ichinose
To: Executive Board, Ava Community Energy
From: Audrey Ichinose, East Bay Clean Power Alliance (EBCPA) California Alliance for Community Energy (CACE)
Re: Increasing Ava’s investment in community-based Resilience Hubs Thank you for the chance to comment.

A significant event will soon take place that has significant implications for Ava’s support of community Resilience Hubs in its service area.

On May 13 workers will begin taking down the Iron Gate Dam on the Klamath River in northeast CA, the largest and southernmost of the four hydroelectric dams slated for removal from the river. As many of you know, the dam was owned by Pacificorp, an entity controlled by Berkshire Hathaway. Two factors brought about the dam’s removal, according to SFChronicle reporting:
· Pacificorp decided that the dam was too costly to operate. · And a large coalition of Indigenous tribes, farmers, fishermen and environmentalists strongly supported it. The dam greatly harmed the salmon population and did not provide water for drinking or farming for communities along the river.
5/1/24, 11:43 AM Ava Community Energy Mail - Public Comment for Executive Board Meeting, May 1, 2024 https://mail.google.com/mail/u/0/?ik=703fa6ea73&view=pt&search=all&permmsgid=msg-f:1797872604389018338&simpl=msg-f:1797872604389018338 1/2 It seems remote from us, but the dam’s removal has relevance for the Resilience Hubs we have proposed for our underserved and disadvantaged communities:
· Like the dam removal, Resilience Hubs cannot be just a temporary response to climate change. We know that climate change is here to stay and that long-lasting changes are needed.
· Like the coalition that supported dam removal, Resilience Hubs are a meaningful way to restore and rebuild our fragmented, disadvantaged communities.

The second significance of the Iron Gate Dam removal for us is that Resilience Hubs won’t be cheap. It will require substantial investment over a number of years. Ava Community Energy thus needs to be thinking in terms of millions of dollars. Given the agency’s continued budgetary success, the suggestion of $15mil from the current surplus seems appropriate.

Thank you very much.
(For SF Chronicle reporting: https://www.sfchronicle.com/california/article/klamath-dam-removal-19431558.php) 5/1/24, 11:43 AM Ava Community Energy Mail - Public Comment for Executive Board Meeting, May 1, 2024 https://mail.google.com/mail/u/0/?ik=703fa6ea73&view=pt&search=all&permmsgid=msg-f:1797872604389018338&simpl=msg-f:1797872604389018338 2/2

Ava Community Energy Executive CommitteeMay 1, 2024

Ava Community Energy Executive Committee
May 1, 2024