14. 2026 Financial Adjustments, including Value Proposition — Ava Community Energy Board of Directors, December 17, 2025

Staff Report Item 14
Staff Report Item 14
To: Ava Community Energy Authority
From: Howard Chang, CEO
Subject: Request for Board authorization to take rate-setting and budget-management actions to mitigate a forecasted budget deficit.

Date: December 17, 2025
__________________________________________________________________ Summary
Staff requests Board authorization to take designated rate-setting and budget-management actions to mitigate a forecasted budget deficit.

Staff is presenting on the financial forecast for calendar 2026 and reviewing several scenarios of recommended measures to offset a forecasted deficit of $250MM from July 2025 to December 2026. This Staff Report relies upon the comprehensive presentation detailing the calendar year 2026 financial forecast and measures available to allow Ava to reduce customer bills, remain competitive to PG&E, and offset a forecasted financial deficit.

Important context for this review is that Fiscal year 2024-25 actualized with a strong budget surplus of ~$130.4MM serving to provide a significant Rate Stabilization Fund. Additionally, 2026 residential generation rates (Ava generation + PG&E PCIA charges) are forecasted to decrease by ~30% from 2025 levels. Reducing Ava’s rates has been a critical focus to address affordability concerns in the face of rising electricity prices, primarily driven by PG&E’s transmission & distribution charges.

Staff seeks Board authorization to take the following actions on a portfolio of adjustments to bridge the $250MM budget deficit that is forecasted for July 1, 2025 – December 31, 2026 including:

Staff Report Item 14

1. Apply the full Rate Stabilization Fund of $150MM in 2026 toward closing the budget gap.

By applying the Rate Stabilization Fund in this manner, Ava can minimize increases to Bright Choice and Renewable 100 rates.

2. Increase Ava’s rates by reducing Bright Choice discount to 0.5% compared to PG&E's generation rate and increasing the Renewable 100 premium to 1.5 cents per kilowatt-hour, in order to increase revenues by an estimated $61.5MM, effective January 1, 2026.

3. Reduce renewable energy procurement targets for calendar year 2026 by an estimated

8.4% to reduce expenses by an estimated $10MM.

4. Reallocate $10MM of unused and un-earmarked funds from the Local Development budget (accrued from its inception to FY26) toward reducing the forecasted deficit, where such funds were not applied to any active or planned initiative.

5. Reduce operating expenditures by an estimated $3.5MM relative to the FY25/26 Board-approved budget by implementing operational efficiencies including but not limited to deferring net-new consultant engagements and select marketing initiatives.

6. Apply up to $30MM from Reserves toward the budget deficit (with an estimate of applying approximately $15MM but the authorization to apply more if needed).

This Staff Report serves as a very succinct summary and reference should be made to the presentation for further details.

Attachments
A. Resolution #1: Authorize Designated Rate-Setting and Budget-Management Actions to Mitigate a Forecasted Budget Deficit
B. Appendix 1: Public comment period in detail
C. Appendix 2: Public value proposition proposal webinar slide deck D. PowerPoint Presentation
Attachment Staff Report Item 14A
RESOLUTION NO. R-2025-xx

A RESOLUTION OF THE BOARD OF DIRECTORS

OF AVA COMMUNITY ENERGY AUTHORITY TO AUTHORIZE RATE-SETTING AND BUDGET-MANAGEMENT ACTIONS TO MITIGATE A

FORECASTED BUDGET DEFICIT
WHEREAS Ava Community Energy Authority (“Ava”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, under the Joint Exercise of Powers 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 Joint Powers Agreement (“JPA”) in March of 2020. The city of Stockton was added as a member to Ava in September of 2022. The city of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024. On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception.

WHEREAS At the November 2025 board meeting, Staff notified the Board of a forecasted budget deficit for the period of July 2025 to December 2026, and WHEREAS At the December 2025 board meeting, Staff presented various scenarios of financial adjustments that included use of the Rate Stabilization Fund, changes to the value proposition for Bright Choice and Renewable 100 services, use of Reserves, and reductions in operating expenditures, Local Development funding, and renewable energy credit procurement to address forecasted budget shortfalls through December 2026.

NOW, THEREFORE, THE BOARD OF DIRECTORS OF AVA COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:

Section 1. To authorize staff to take the following actions to mitigate the $250MM budget deficit that is forecasted for July 1, 2025 – December 31, 2026:

1. Apply the full Rate Stabilization Fund of $150MM in 2026 toward closing the budget gap.

2. Increase Ava’s rates by reducing Bright Choice discount to 0.5% compared to PG&E's generation rate and increasing the Renewable 100 premium to 1.5 cents per kilowatt-hour.

3. Reduce renewable energy procurement targets for calendar year 2026 by an estimated 8.4%.

4. Reallocate $10MM of unused and un-earmarked funds from the Local Development budget (accrued from its inception to FY26) toward reducing the Attachment Staff Report Item 14A
forecasted deficit, where such funds were not applied to any active or planned initiative.

6. Apply up to $30MM from Reserves toward the budget deficit.

ADOPTED AND APPROVED this 17th day of December 2025.

Betsy Andersen, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
2026 Value Proposition Proposal Public Comment Period:

November 22, 2025 - December 8, 2025
Overview of Public Process and Summary of Comments
As part of Ava Community Energy’s rate-setting process, staff hosted an open public comment period that featured two webinars discussing our proposed value proposition changes for calendar year 2026. Staff opened the public comment period with the email shown in Image 1, below. The email includes an option to translate content into Spanish, Hindi, simplified Chinese, and Russian, reflecting the most common languages requested by Ava contact center customers.

In addition to the email to Ava’s email list subscribers, staff promoted two webinars and the public comment period through various social media platforms, including Facebook, Instagram, and Bluesky. The engagement statistics for these platforms are provided in Table 1, below.

Following the webinars, all recordings were uploaded to Ava’s rates page on our website at avaenergy.org/your-energy-options/plans-and-rates/rates/ and Ava’s YouTube channel.

Attachment Staff Report Item 14B
Image 1: Introduction and webinar invitation email, sent on November 20, 2025 Attachment Staff Report Item 14B
Webinar and Public Comment Marketing and Communications Marketing & Communications Reach (As of December 8, 2025) Date Source Content Reach
Thursday, November
20, 2025 at 11 am
Email Value proposition
invitation email
Sent to: 4,475
Opens: 3,412
Clicks: 287
11/20 at 10:58 am
11/24 at 9:05 am
12/3 at 9 am
Facebook Post 1
Post 2
Post 3
Views: 147
Interactions: 3
Thursday, November
20 at 10:58 am
Instagram Instagram post
(pinned to the top of
our profile for entirety
of public comment
period)
Views: 315 (63%
followers, 37% non-followers)
Interactions: 4
Thursday, November
20 at 10:58 am
Bluesky Bluesky post
(pinned to the top of
our profile for entirety
of public comment
period)
n/a
Tuesday, November
25, 2025, at 12:00
pm
Webinar 1 Registered: 8 Attended: 1
Public Comment: 0
Thursday, December
4, 2025, at 11:00 am
Webinar 2 Registered: 3 Attended: 0
Public Comment: 0
Tuesday, November
25, 2025
YouTube Video of
Webinar 1
2025-2026 Mid-Year
Value Proposition
Webinar 1
Views: 21
Thursday, December
4, 2025
YouTube Video of
Webinar 2
2025-2026 Mid-Year
Value Proposition
Webinar 2
Views: 10
11/20 - 12/8 Website Rates page Views: 257
Engagements: 172
Attachment Staff Report Item 14B
Table 1: Marketing and Communications Reach
Summary Overview of Comments
No verbal comments and three written comments were received, summarized below.

Comments and questions were received from the following individuals and/or organizations:

Summary of Comments:
● Commenter Name: Julie Casino, Community Member, Submitted November 20, 2025 The community member expressed their dissatisfaction about electricity rates and feels unsure about Ava's benefits to the community.
● Commenter Name: Pauline Anthony, Community Member, Submitted November 20, 2025
The community member expressed that gas and electricity rates are too expensive, that rates have increased at too fast a pace, and questioned Ava’s value proposition. ● Commenter Name: David Wolfson, Community Member, Submitted November 25, 2025
The community member is concerned about the new P&GE Base Services Charge structure, which they believe penalizes small electricity users and encourages increased electricity use.

Verbal Public Comments
Public comment periods were available at the following two webinars:
● Tuesday, November 25, 2025, at 12:00 pm
● Thursday, December 4, 2025, at 11:00 am
Links to the staff presentation and the comments can be found on our website at avaenergy.org/your-energy-options/plans-and-rates/rates/ November 25, 2025 Webinar: Public Comments
● No public comments
December 4, 2025 Webinar: Public Comments
● No public comments
Written Public Comments
Written comments, as submitted to [email protected]:
● Commenter Name: Julie Casino, Community Member, Submitted November 20, 2025 Subject: “Changing prices"
Attachment Staff Report Item 14B
Comment: “Wasn’t this new company supposed to to be here to help the community? To help people who can’t afford pg&e’s crazy prices?,and now your saying you want to raise your prices to the same,what a ripoff,scam and an all out lie!!Just to get people in and then you go do that s****** a** s****!This company should be ashamed of themselves.So your NOT about helping people,but just about YOURSELVES!YOU KNOW GOD DOES NOT LIKE UGLY,which means STOP being GREEDY!!!If it’s going to be like that I would have never switched,and you can rest assured I will be going back,just for the purpose that I was lied to !!!!SHAME on YOU!!!!” ● Commenter Name: Pauline Anthony, Community Member, Submitted November 20, 2025
Subject: “Cut the rate"
Comment: The rates of gas and electric are too high for the 30 amp service provided to the residents in this mobile home senior park. When I first moved here more than 15 years ago, my electric and gas bill were about $50 combined each during the summer months and about $100 combined during the winter months. Ever since Hayward has chosen to use clean energy, the rates haven't been lower than $200 for gas and electric combined during the summer months and at least $300-$400 during the winter months.

It may be cleaner, but definitely NOT cheaper energy costs that were advertised to the consumers. Whatever happened to TRUTH in ADVERTISING. Even the bi-annual energy credits are dismal and only offer a credit on a monthly basis about the cost of a loaf of bread. The math on the consumers' bills says the cost is 100% or more increase in costs. I think it is well past the initial upstart time to cut the rates progressively downward to pre-clean energy levels.
● Commenter Name: David Wolfson, Community Member, Submitted November 25, 2025
Subject: “pge rates comment"
Comment: “Hi; I live in Berkeley and use AVA. Presumably, you are bound by the PGE $24 a month flat fee starting next year, and maybe by their new rate which encourages large electricity consumption. I don't like either one, as it penalizes small electricity users. The assumption that it will encourage transition to a green electricity based consumption model doesn't add up to me. In general, those with the resources will transition, by buying evs, induction stoves, heat pumps, etc. It will also encourage large consumption of inefficient appliances, including air conditioning. If you have any flexibility, I would suggest setting rates that don't penalize small consumers.

Thanks, David Wolfson”
Attachment Staff Report Item 14B
January 2026
Ava Value Proposition:

Public Comment 1
Public Meeting
Reminders
2 ● The video and audio from this meeting will be
posted on our website
● We will provide a brief introduction to the proposed
policy and then allow for your comments
● Everyone will be muted until the public comment
period
● Please be prepared to provide:
○ Your name
○ Organization, if applicable
○ City of residence or business location
○ Your comment
Thank you for participating in our public meeting!
About Ava
3 What is Ava Community Energy?
Ava Community Energy (Ava) is a local community choice
power supplier committed to providing Alameda County and the Cities of Lathrop, Stockton, and Tracy with clean, green electricity at competitive rates.

As a not-for-profit public agency, Ava reinvests revenue back into the community through local electrification programs, clean power projects, and community organizations.
4 Attachment Staff Report Item 14C
How It Works
Ava buys from, and is building,
clean power plants. Ava sells
the power to customers at
competitive rates.
5 1. Ava buys and generates
clean power

2. PG&E delivers the power
to homes and businesses
Ava’s power is delivered to
customers by PG&E.

Customers pay PG&E for
delivery as they always have.

3. Customers get the
power and local benefits
Customers benefit from
clean energy, local
governance, and innovative
programs.
$Ȁ74 million
Total customer savings
since 2018
$ȀȀ5 million
Reinvested in our
communities since 2018
through programs:
● Local infrastructure
● Programs
● Local sponsorships
● Community grants
● Local vendor spending
Ava Customer Savings and Value
$4ǿ million
Paid for local generation,
driving economic
development, local union
jobs, and tax revenue:
● Scott Haggerty Wind
Energy Center
● Kola Battery Storage
System
Definitions
7 Current Service Plan Options
62% eligible renewable
energy priced at 5% below
PG&E rates.
8 Bright Choice Renewable 100
100% renewable energy
priced at 1/4 cent per kWh
above PG&E rates
vs.

PG&E
23%
renewable
Renewable:
■ Wind
■ Solar
■ Biomass & Biowaste, Eligible
Hydroelectric, Geothermal
Other:
■ Hydro
■ Nuclear
■ Other or Unspecified
Figures reflect our actual power mix from 2024 (most recently published). Power mixes are published annually each summer for the preceding year.

Attachment Staff Report Item 14C
Default Service Plan
9 Jurisdiction Residential Commercial CARE/FERA/
Medical Baseline
Albany, Berkeley, Dublin, Emeryville,
Hayward, Pleasanton, San Leandro Renewable 100 Renewable 100 Bright Choice Piedmont Renewable 100 Bright Choice Bright Choice
Lathrop, Livermore, Newark, Oakland,
Stockton, Tracy, Union City, and
Unincorporated Alameda County
Bright Choice Bright Choice Bright Choice
Fremont Renewable 100
Bright Choice
In August 2026:

Renewable 100
Bright Choice
Rates and Value Proposition
● Rates: What Ava charges customers for
electricity, currently updated when PG&E
changes their generation rates or fees
● (Rate) Value proposition: The cost
comparison to PG&E rates based on Ava
product.

Ava brings additional value to our community. This is
only about the direct financial value to our customers. 10 Ava has saved customers
over $174 million since
2018 through lower rates
and bill credits
PCIA
Power Charge Indifference
Adjustment (PCIA): A per
kilowatt-hour fee that PG&E assesses
to a customer that allows PG&E to
recuperate costs for long-term
above-market costs electricity
generation contracts.
● Ava’s value proposition includes
the PCIA, since it is added as line
item on the PG&E page of the bill.
11 Total rate
2026 Context and Proposal
12 Attachment Staff Report Item 14C
Historic Generation Rates
● Ava is seeking to reduce its
2026 Bright Choice
generation rates by
~40-50% from 2025 levels
● 2026 generation rates
(including PCIA) are
expected to decrease by
~32% from 2025 levels
● PG&E’s 2026 delivery rates
are projected to increase
~4% from 2025 levels
● 2026 overall electricity bills
are projected to decrease
by ~11% from 2025 levels
Ava value proposition July update
-32%
Note: Chart reflects 2018 PCIA vintage TOU-C
(Ava’s most common residential rate)
-49%
13 2026 Value Proposition Proposals
● Historically, when rates are high, Ava’s Bright Choice discount has increased. When rates are low, the discount has decreased. ● 2026 rates are forecast to be 40–50% lower than 2025
○ 30% lower for customers, when PCIA is included
● Staff seeks to maintain a balanced budget for the agency through an updated value proposition, among other budget actions
● At the November Board meeting, staff recommended Option 1 14 Bright Choice Generation Rate
Discount to PG&E
Renewable 100 Generation Rate
Premium to PG&E, per kWh
Option 1 1% 1.25¢
Option 2 0% 1.5¢
Sample Residential Customer Ava Bill
15 2025 Rates 2026 Proposed Rates
Bright Choice
discount: 5%
R100 premium:

0.25¢/kWh
Bright Choice
discount: 0%
R100 premium:

1.5¢/kWh
Percent
Difference from
2025 Rates
Bright Choice
discount: 1%
R100 premium:

1.25¢/kWh
Percent
Difference from
2025 Rates
Average Residential
Bright Choice
Generation Cost
$50 $35 -29% $35 -30%
Average Residential
Renewable 100
Generation Cost
$53 $41 -24% $40 -25%
Based on an average residential (ETOU-C) customer using 350 kWh per month Renewable 100 in 2026 is approximately 20% lower than Bright Choice in 2025.

Ava Value Proposition History
16 Historically, the value proposition has been inversely related to rates ● Relatively high rates are correlated with an ability to offer a higher discount ● Lower rates typically mean a lower discount
Attachment Staff Report Item 14C
Public Comment Period
17 Please note:
• Everyone on the call will see what you type into the chat box. • We will call on each speaker in the order we received the chat, we’ll then disable the mute feature for each speaker.
• Please be conscientious of the time. Every speaker will be allowed three minutes.
• This webinar is being recorded and will be posted to our website.

How to
Participate
Instructions

1. Click on the “Q&A” bubble to start

2. Enter your name, city, and organization into the text box

3. Click the "Send" button to Submit your request for comment 18 Thank You for Participating
Ava staff’s next steps:
● Post this webinar, including the audio recording of your comments, on our website at:

AvaEnergy.org/your-energy-options/plans-and-rates/rates ● Summarize all public comments in the staff report to Board ● Present summary and value proposition recommendation
at Board of Directors meeting on December 17th, 2025 as part of the update to next year's budget.

Additional comment opportunities:
● Written comments may be emailed to:

[email protected]
19 All comments are due by
Monday, December 8th,
2025 at 8:00 AM
20 3-Minute Public
Comment Timer
Attachment Staff Report Item 14C
Online
Phone
Email
Social
AvaEnergy.org
833-699-3223
[email protected]
PoweredWithAva
Online
Phone
Email
Social
Comments Welcome at:

[email protected]
21 Thank you!
Attachment Staff Report Item 14C
Request for Board authorization to take
designated rate-setting and budget-
management actions to mitigate a
forecasted budget deficit
December 17, 2025
1 Attachment Staff Report Item 14D
Agenda
• Introduction & Background
• 2026 Financial Forecast
• Recap of November meeting
• Summary of Scenarios
▪ Rate Stabilization Fund
▪ Value Proposition Changes
▪ Renewable Energy Adjustments
▪ Local Development Fund Adjustments
▪ Operating Expenditures
▪ Reserves
• Conclusion & Recommendation
2 Attachment Staff Report Item 14D
Introduction
• In May/June 2025 staff introduced 2026 financial forecast as part of the fiscal 2025-26 budget approval, which previewed PCIA reform, electricity rates, and financial impacts to Ava
• With PG&E’s October 2025 ERRA (Energy Resource Recovery Account) filing, we received firm 2026 PCIA and rate numbers
▪ Final numbers to be filed in the AET (Annual Energy True-up) late Dec - no material adjustments expected
• Staff presented updated 2026 financial forecast with recommended actions at Nov 19 Board and updates to the value proposition at the Dec 3 Exec Comm • Staff is now providing updated analysis and measures to manage the 2026 financial deficit and seeking approval for a set of actions • While some of these recommendations are undesirable, they will help ensure financial stability in order to continue to provide long-term value and services to our customers
• Importantly, the recommended actions are intended to allow Ava to reduce customer generation rates by 25-30%, an essential affordability goal for Ava 3 Attachment Staff Report Item 14D
Brief Background
Budget Overview and Forecast
• Fiscal year 2024-25 actualized with a budget surplus of ~$130.4MM • 2026 residential generation rates (Ava generation + PG&E PCIA charges) are forecasted to decrease by ~30% from 2025 levels
• Projected deficit for July 2025 through Dec 2026 is ($250MM) November Board Actions:
• Board direction to move forward on value proposition changes • Board did not move the staff recommendations:
▪ Allocate 100% of FY24-25 budget surplus to Rate Stabilization Fund ▪ Reduce $10MM in non-earmarked local development funds • Request for additional information on various measures presented and risk analysis
4 Attachment Staff Report Item 14D
Historic Generation Rates
● Ava is seeking to reduce its
2026 Bright Choice
generation rates by ~40-50%
from 2025 levels
● 2026 generation rates
(including PCIA) are expected
to decrease by ~32% from
2025 levels
● PG&E’s 2026 T&D rates are
projected to increase ~4%
from 2025 levels
● 2026 overall electricity bills
are projected to decrease by
~11% from 2025 levels
-32%
-49%
5 Note: Chart reflects 2018 PCIA vintage TOU-C
(Ava’s most common residential rate)
Attachment Staff Report Item 14D
• Cal Year 2026 deficit of ($364MM), net with 2nd half 2025 surplus of $115MM = ($250MM) • FY 2025-2026 estimates are updated from the board approved budget on June 18, 2025 ▪ Actuals: July to September; Updated projections: October to June • CY 2027 & 2028 forecast intended to provide high level indicative results:
▪ Energy market forecasts are based on October ERRA and industry derived forward prices ▪ Maintains current value proposition (5% Bright Choice discount / 0.25cent R100 premium) ▪ $0 allocated to incremental Local Development Funding ▪ $0 contribution to RSF or Reserves
2025 to 2028 Forecasted Budget Impacts
= (249,610,000)
6 Note: 2028 does
not include PCIA
Track 2 potential
impacts, which
would lower Net
Revenues
Attachment Staff Report Item 14D
Measures to Consider, as presented in November
Measure Approximate
Value
Cumulative Value
Rate Stabilization Fund (RSF) $149.5MM $149.5MM
Value Proposition Change in January 2026
Bright Choice: 5% → 1%
Renewable 100: ¼¢ →1.25¢ per kWh
$51.7MM $201.2MM
2024-25 Budget Surplus On-bill credits moved to RSF $13.0MM ------- 2025-26 Local Development budget reduction (non
earmarked funding) $10.0MM $211.2MM
Reduce REC procurement $4-12MM $215.2MM
● Cumulative value of budget considerations dropped from $228MM to $215MM, in retaining the CARE/FERA on-bill credits
7 Attachment Staff Report Item 14D
Budget Adjustment Scenarios
Scenario A: Scenario B: Scenario C:

Rate Stabilization Fund $149.5 $149.5 $149.5
Value Proposition Change
0% Bright Choice discount

1.75 cents/kWh Renewable 100 premium

0.5% Bright Choice discount

1.5 cents/kWh Renewable 100 premium
1% Bright Choice discount

1.25 cents/kWh Renewable 100
premium
$71.2 $61.5 $51.7
REC Procurement Reduction* $15 $10 $5
Local Development Fund Reduction $15 $10 $5
Operating Expenditure Reduction $4.5 $3.5 $2.5
Reserves $0 $15 $35
Cumulative Value $255 $250 $250
All dollar figures in millions of dollars.

Other possible adjustments:
● Other sensitivities of the above measures can be considered ● Set Bright Choice rate at a premium to PG&E generation rate ● Sale of Ava-owned real estate
● Reduce and/or eliminate bill credits 8
Attachment Staff Report Item 14D
Rate Stabilization Fund and On-bill Credit Balances
• Current RSF balance is $149.5MM with $13MM authorized from the 2024-25 budget surplus for CARE/FERA on-bill credits to be issued in the Jan/Feb 2026 timeframe • 2025-26 approved budget included utilization of $35.3MM to manage the forecasted fiscal year deficit
• Staff is seeking Board authorization to allow the CEO to utilize the full RSF of $150MM in calendar year 2026 to address the forecasted deficit 9 As of June 30, 2025 Added Current
RSF 32,129,726 117,375,392 149,505,118
On-bill Credits - 13,041,710 13,041,710
Totals 32,129,726 130,417,102 162,546,828
Attachment Staff Report Item 14D
Value Proposition process and comments summary
• Following the rate setting policy last updated in 2022, staff has ▪ Information posted on website
▪ Facilitated two online webinars
• Tuesday, November 25, 2025, at 12pm - 4 staff, 1
public attendee
• Thursday, December 4, 2025, at 11am - 1 staff, no
public attendees
▪ Provided directions for submitting written public comment via email from November 20th to December 8th
▪ Presented information at the December Executive
Committee and Community Advisory Committee meetings
• Staff received no written or verbal comments during the webinars • Trends in comments received via email:
▪ Request to see lower electricity rates
▪ Request for Ava to reconsider use of new, clean energy sources if they are more expensive than previous
technologies
10 Attachment Staff Report Item 14D
Adjustments to Value Proposition - Summary
11 Scenario A Scenario B Scenario C
Bright Choice 0% 0.5% 1%
Renewable 100 1.75¢ 1.5¢ 1.25¢
Total Contribution $71.2MM $61.5MM $51.7MM
Attachment Staff Report Item 14D
Adjustments to Value Proposition- Details
Generation
Rate Discount
to PG&E
2026 Revenue
Contribution - Bright
Choice ($MM)
4% $6.3
3% $12.6
2% $18.8
1% $25.1

0.5% $28.3
0% $31.4
+1% $37.7
¢ per kWh
Adder to PG&E
2026 Revenue
Contribution -
Renewable 100 ($MM)

0.5¢ $6.6

0.75¢ $13.3

1.0¢ $19.9

1.25¢ $26.5

1.375¢ $29.9

1.5¢ $33.2

1.75¢ $39.8
Bright Choice Discount,
Renewable 100 Adder
2026 Revenue
Contribution
($MM)
4%, 0.5¢ $12.9
3%, 0.75¢ $25.8
2%, 1.0¢ $38.7
1%, 1.25¢ $51.7

0.5%, 1.5¢ $61.5
0%, 1.75¢ $71.2
+1%, 1.75¢ $77.5
12 ● Highlighted cells are included in the proposed scenarios, which do not recommend moving Bright Choice to a premium ● Given an anticipated higher percentage of clean energy, Bright Choice set at a premium to PG&E could be justifiable ● Other CCAs have at various times set rates above PG&E based on greener power content Attachment Staff Report Item 14D
Comparing Renewable 100 and PG&E Solar Choice
Renewable 100 is open to all Ava customers
• Priced at a uniform per-kWh premium to PG&E
• Powered by a mix of clean energy sources, such as wind and solar PG&E’s renewable rate option is Solar Choice
• Following a PUC decision, as of December 2021, PG&E’s Solar Choice rate is closed to new subscribers
▪ Remains available to customers that are already enrolled • Customers can participate at 100% or 50% of their usage • Customers are assessed a PCIA and program fee, provided with a generation credit • Today, Solar Choice is a 3 to 7¢ premium (depending on vintage) to PG&E’s standard residential rate 13 Attachment Staff Report Item 14D
Recommended Adjustments to Value Proposition
Staff recommends adjusting the value proposition, effective January 2026 to:
• 0.5% savings for Bright Choice and 1.5¢ premium for R100 to PG&E • Historically, when rates are high Ava's Bright Choice discount has increased and when rates are low, the discount has decreased
• Renewable 100 at a 1.5¢ premium in 2026 is 18% lower than 2025’s Bright Choice rate 14 Service Plan Start Service
2018
July 2020 July 2022 July 2023 -
Current
Bright Choice % below PG&E 1.5% 1% 3% 5%
Renewable 100 Premium 1¢ ¾ ¢ ¼ ¢
Attachment Staff Report Item 14D
Value Proposition Rate Information
15 Average 2025
residential rate
(¢/kWh)
Proposed Scenarios for 2026
Scenario A
BC discount: 0%
R100 premium: 1.75¢
Scenario B
BC discount: 0.5%
R100 premium: 1.5¢
Scenario C
BC discount: 1%
R100 premium: 1.25¢
Bright Choice
avg residential
rate (¢/kWh)

14.22 10.13 10.08 10.03
Renewable 100
avg residential
rate (¢/kWh)

15.22 11.88 11.63 11.38
BC % decrease
vs. avg 2025 rate - 28.8% 29.1% 29.5%
R100 % decrease
vs. avg 2025 rate - 21.9% 23.6% 25.2%
Attachment Staff Report Item 14D
Renewable Energy Credit Procurement Reduction - Summary • Ava Compliance Period Procurement covers 2024-2027
• 2024/25 excess procurement = 15.3%
o RE: 7.3% (in 2026 volumes)
o Hydro: 8% (in 2026 volumes)
• Current Policy
o 2026 RE + Hydro Ava target: 81%
o 2027 RE + Hydro Ava target: 85% 16
Scenario A Scenario B Scenario C
Reduction Savings $15MM $10MM $5MM
Reduction % 10.7% 8.4% 4.4%
Resulting RE+CF Power Content 54.8% 62.2% 66.2%
Note: savings and Power Content are estimates.

Realized savings and Power Content will be
impacted by actual market conditions
Attachment Staff Report Item 14D
Renewable Energy Procurement Adjustments - Details
Scenario A Scenario B Scenario C
Estimated Savings $15MM $10MM $5MM
Total RE reduction 10.7% 8.4% 4.4%
Resulting RE+CF Power Content 54.8% 62.2% 66.2%
Renewable 42.0% 44.3% 48.3%
Hydro 12.9% 17.9% 17.9%
Nuclear 6.4% 6.4% 6.4%
Unspecified 38.7% 31.3% 27.3%
GHG Emis. intensity 449 383 352
Excess '24 RE applied 7.3% 7.3% 7.3%
Excess '24-’25 Hydro applied 8.1% 3.1% 3.1%
17 Notes
• Scenario A fully utilizes RE and CF excess procurement from 2024-2025, Scenarios B and C fully utilize RE and partial CF excess procurement from 2024
• Scenarios are estimates; exact savings, PCL %, & emissions to be determined by actual transactions Attachment Staff Report Item 14D
Local Development Budget Reduction
Potential Areas for Amendment Scenario A Scenario B Scenario C FY26 - “Future Roadmap Programs” allocation not
assigned to a specific program
(per June 2025 presentation to the Board)
$4MM $4MM $4MM
FY20-25 - Un-earmarked Funds not assigned to a
specific program
(per March 2025 presentation to the Board)
$9.5MM $6MM $1MM
Cost reductions achieved through efficiencies and
program effectiveness $1.5MM - -
Total Reduction $15MM $10MM $5MM
18 Attachment Staff Report Item 14D
Operating Expenditure Reduction
• Previous presentation incorporated OpEx reductions of $3.5MM - now called out in Scenario B • Total Fiscal 2025-26 Budgeted Overhead OpEx: $48.4MM
• Total OpEx / Total Annual Expenses: 5.3%
• Total Personnel costs / Total Annual Expenses: 3.3%
• Note: All local development expenses are excluded from these figures and allocated to the local development fund, with the exception of all personnel related costs 19 Scenario A Scenario B Scenario C
Description
Eliminates or defers
workflows such as rate
design consultant,
marketing campaigns, data
integration, AI integration
Captures operational
efficiencies while
maintaining all material
work deliverables
Retains $1MM for
contingency opex
% Reduction out of Total Overhead OpEx 9.3% 7.2% 5.0%
Total $ Reduction $4.5MM $3.5MM $2.5MM
Attachment Staff Report Item 14D
Use of Reserves Within Ava Financial Waterfall
Ava maintains a Reserve Fund and Policy, established in 2018 and amended in 2021 intended to provide financial stability for long-term business sustaining objectives
Excerpt from RSF Board item approved on September 17, 2025 Ava’s current levels of liquidity utilization are represented as a waterfall from available funds:

1. Working Capital – Operational cash flow retained for expected business cycle needs

2. Rate Stabilization Fund – Deferred revenues for available for short-term budget cycle liquidity challenges or for other financial matters necessary for maintaining budget stability year to year

3. Credit Facility – Posting letters of credit to retain working capital and only drawn if necessary for operating maintenance

4. Reserve Funds – Financial strength base layer set aside and used only in case of extremely dire emergencies ("Disaster/Earthquake") and with board approval a. Supports our “A” Credit Rating
b. Supports our Line of Credit Covenants
Using Reserves vs. Line of Credit to manage deficit and cash flows:
• Cost comparison:
▪ Cost to draw on line of credit (approx 4.45%) vs. budget interest forecast 3% (2026), 2.75%(2027) • Most prudent to use cash on hand vs. deficit financing through debt ▪ Higher cost to service and payback debt - raises budgeted costs to amortize draw ▪ Debt primarily used for acquiring or building long-lived assets ▪ Draws for cash flow seen externally as a lifeline to continue operating, not a budget balancing mechanism Staff recommends using small amounts of reserves, if necessary and if all other measures exhausted 20 Attachment Staff Report Item 14D
Reserve Policy
• Reserve Policy is 25% to 75% of annual operating expenses with a target of 50% • Risks of using Reserves
▪ Less liquidity for volatile power market events
▪ Effects from PCIA Reform -Track 2 changes are anticipated to be implemented in 2028 ▪ Potential credit rating impact if using larger amounts ▪ Earlier draws will need to be replenished to remain at 25% or above as OpEx increases FY 25/26 FY 26/27 FY 27/28
Current Reserve Balance ($MM) $330 $330 $330
Operating Expenses ($MM) $899 $959 $1,083
% (Reserve / OpEx) 36.7% 34.4% 30.5%
Reserve minimum @25% ($MM) $225 $240 $271
Reserve Target @50% ($MM) $450 $480 $542
Reserve maximum @75% ($MM) $674 $719 $812
21 Attachment Staff Report Item 14D
Reserves Summary
22 Scenario A Scenario B Scenario C
Reserves ($MM) $0.0 $15.5 $41.3
Remaining Balance ($MM) $330.0 $314.5 $288.7
% Opex FY25/26 36.71% 34.98% 32.11%
% Opex FY26/27 34.41% 32.79% 30.10%
% Opex FY27/28 30.47% 29.04% 26.66%
Attachment Staff Report Item 14D
Energy Market Risk in Cal 2026
23 Event 1 Standard Deviation Risk 2 Standard Deviation Risk Geopolitical event, enduring impact $85MM $170MM
Bad Winter $15MM $30MM
Hot Summer $30MM $60MM
● Despite best efforts to forecast, energy prices will actualize differently. Power prices and various energy products can vary year to year within +/-1 to 2 standard deviations ● Any scenario that the board approves should include authorization to utilize reserves with a stress case to allow for deficit management
● An increase in power prices would increases energy expenses in 2026, which could true up to higher rates in 2027 and increase financial headroom. This presents a cash flow risk for 2026 ● A decrease in power prices would decrease energy expenses in 2026, which could true up to lower rates in 2027 and create more financial risk
● Multiple scenarios can trigger energy price risk
Attachment Staff Report Item 14D
Who does Ava Serve?
• 2 counties and 16 cities
• Population of over 2 million people and ~750,000 accounts ▪ 61% is non-residential load and 39% is residential load ▪ 10% of total load is enrolled in CARE/FERA programs
▪ 70% of load is on Bright Choice and 30% of load is on Renewable 100 • Ava is the default energy generation provider operating in a quasi competitive environment to PG&E ▪ Retain 95% of customers and load
▪ Need to continue to remain competitive in providing clear value to our customers • Strive to represent our diverse customers’ and communities’ values in terms of rates, programs, power content, and other key energy topics
• As a local government agency operating in the energy commodities market Ava’s top priority is to maintain strong financial standing to ensure that Ava can continue to provide this value into the long-term future 24 Attachment Staff Report Item 14D
Request of the Board/Staff Recommendation
Authorize staff to take the following actions to mitigate the $250MM budget deficit that is forecasted for July 1, 2025 – December 31, 2026 Scenario B Net Result
Rate Stabilization
Fund $149.5MM $0MM remain
Value Proposition
Change $61.5MM Gen rate reduction of 24-29% vs. 2025
REC Procurement
Reduction $10MM
Board approved
renewable / hydro target
reduced to 73%
Local
Development
Budget Reduction
$10MM Total amount in Local
Dev Fund is ~$92MM
Operating
expenditures
Reduction
$3.5MM Total Overhead OpEx:
$48.4MM
Reserves $15-$30MM $300MM to $315MM
Remain
Cumulative
Value $250-$265MM

1. Apply the full Rate Stabilization Fund of $150MM in 2026 toward closing the budget gap. By applying the Rate Stabilization Fund in this manner, Ava can minimize increases to Bright Choice and Renewable 100 rates.

2. Increase Ava’s rates by reducing Bright Choice discount to 0.5% compared to PG&E's generation rate and increasing the Renewable 100 premium to 1.5 cents per kilowatt-hour, to increase revenues by an estimated $61.5MM, effective January 1, 2026.

3. Reduce renewable energy procurement targets for calendar year 2026 by an estimated 8.4% to reduce expenses by an estimated $10MM.

6. Apply up to $30MM from Reserves toward the budget deficit (with an estimate of applying approximately $15MM but the authorization to apply more if needed). 25
Attachment Staff Report Item 14D
Appendix
26 Attachment Staff Report Item 14D
2026 RE Power Procurement Adjustment Scenarios
27 Attachment Staff Report Item 14D
Presentation to the Board
November 17, 2025
28 Attachment Staff Report Item 14D
Introduction
● Fiscal year 2024-25 actualized with a strong budget surplus of ~$130.4MM ● 2026 residential generation rates (Ava generation + PG&E PCIA charges) are forecasted to decrease by ~30% from 2025 levels
● Review calendar year 2026 financial forecast and consider different measures to allow Ava to reduce customer bills, remain competitive to PG&E, and offset a forecasted financial deficit of $247MM from July 2025 to December 2026
○ 2025 PCIA and energy market price changes
○ Historical generation rates
○ 2026 Financial Forecast
○ Measures to consider
● Staff is recommending a number of measures for board consideration, some of which require action in Nov/Dec: Adjustments to value proposition, changes to 2024-25 budget surplus allocation, and changes to local development funding
● With the established RSF, substantial Reserves, Compliance Period Procurement Method, $300MM line of credit, and the value that we have created for our customers since launching in 2018, we are well positioned to work through challenges in 2026 and significantly reduce customer rates Attachment Staff Report Item 14D
PCIA and Market Price Changes
June 2025 CPUC PCIA Reform (Track 1)
● CPUC adopted a decision (D.25-06-049) under an accelerated 4-month schedule revising how Market Price Benchmarks (“MPBs”) are calculated for Resource Adequacy (“RA”).
○ Note: Ava and CalCCA’s requests for rehearing to the CPUC were denied (D.25-10-061). ● RA MPBs now use multi-year averaging instead of single-year data, among other changes. This smooths the effect of price volatility, lowers MPBs for 2025 and 2026, and increases the Power Charge Indifference Adjustment (“PCIA”). ● This change is being implemented to 2026 rates and includes a retroactive true-up on 2025 rates ● Track 2 (2026-27) will examine potential changes to renewable and brown power MPB calculations PG&E PCIA Adders Forecast
2025**
Final
2025**
Forecast
2026**
% Δ 2025
Forecast vs. Final
RA ($/kW-month)
System RA
Local RA (PG&E)
Flex RA
$42.54
$13.29
$14.16
$11.21
$11.21
$11.21
$11.53
$11.53
$11.53
(73.6%)
(15.7%)
(20.8%)
Renewables ($/MWh) $71.24 $63.86 $62.45 (10.4%)
Brown Power ($/MWh)
On Peak
Off Peak
$55.02
$53.18
$50.20
$52.31
(9.6%)
(1.6%)
October 2025 PG&E ERRA Filing
● PG&E’s Energy Resource Recovery
Account (ERRA) filing provided revised
revenue requirements, PCIA MPBs, and
2026 rates
● RA MPBs decrease materially due to PCIA
reform while Renewables and Brown
Power decrease due to softening prices
**Source: PG&E-06, [2024] Fall Update Testimony, (A.24-05-009), Table A & B, pp. 10–11; Exhibit PG&E-06, [2025] Fall Update Testimony, (A.25-05-011), Table A & B, pp. 16-17.

Attachment Staff Report Item 14D
Historic Generation Rates
● Ava is seeking to reduce its
2026 Bright Choice
generation rates by ~40-50%
from 2025 levels
● 2026 generation rates
(including PCIA) are
expected to decrease by
~32% from 2025 levels
● PG&E’s 2026 T&D rates are
projected to increase ~4%
from 2025 levels
● 2026 overall electricity bills
are projected to decrease by
~11% from 2025 levels Ava value proposition July update -32%
Note: Chart reflects 2018 PCIA vintage TOU-C
(Ava’s most common residential rate)
-49%
Attachment Staff Report Item 14D
• Cal Year 2026 deficit of ($364MM), net with 2nd half 2025 surplus of $117MM = ($247MM) • FY 2025-2026 estimates are updated from the board approved budget on June 18, 2025 ▪ Actuals: July to September; Updated projections: October to June • FY 2026-2027 budget has the following assumptions:
▪ Energy market forecasts are based on October ERRA and industry derived forward prices ▪ 4% increase in operating expenses
▪ $0 allocated to Local Development
2025 to 2026 Forecasted Budget Impacts
= (246,795,000)
2025 2026 2026
OPERATING ACTIVITY Jul-Dec Jan-Jun Jul-Dec
TOTAL OPERATING REVENUE 597,713,000 251,746,000 350,605,000

EXPENSES & OTHER USES
Total Energy Operating Expenses 461,757,000 392,265,000 533,546,000 Total Overhead Operating Expenses 21,368,000 24,185,000 25,158,000 NET NON-OPERATING POSITION 2,618,000 2,003,000 6,799,000 TOTAL NET REVENUES 117,206,000 (162,701,000) (201,300,000) Attachment Staff Report Item 14D
Measures to Consider
Measure Approximate Value Cumulative Value
Rate Stabilization Fund (RSF) $149.5MM $149.5MM
Value Proposition Change in January 2026
Bright Choice: 5% → 1% and Renewable 100: 0.25¢ →1.25¢ per kWh $51.7MM $201.2MM
2024-25 Budget Surplus On-bill credits moved to RSF $13.0MM $214.2MM 2025-26 Local Development budget reduction (non
earmarked funding) $10.0MM $224.2MM
Reduce REC procurement $4-12MM $228.2MM
• Projected deficit for July 2025 through Dec 2026 is ($247MM) ▪ ~$20MM deficit remains following all recommended actions • Staff recommends very prudent management of expenses and close monitoring of actuals & liquidity
▪ Consider further action in 2026 as 2nd half carries the largest proportion of deficit Attachment Staff Report Item 14D
Summary of RSF and Reserve Balances
• Staff recommends utilization of RSF in full in 2026 to offset the deficit • Staff does not recommend any material use of Reserves ▪ Maintain sufficient liquidity and credit stability
• Utilization of RSF will lead to a significant reduction in cash levels ▪ Ava has a $300MM line of credit for short-term liquidity needs, if necessary ▪ $257MM is available, net of planned posted letters of credit As of June 30, 2025 Added Current
RSF 32,129,726 117,375,392 149,505,118
Reserves 330,873,400 - 330,873,400
Totals 363,003,126 117,375,392 480,378,518
Attachment Staff Report Item 14D
Adjustments to Value Proposition
Service Plan Start Service
2018
July 2020 July 2022 July 2023 -
Current
Bright Choice % below PG&E 1.5% 1% 3% 5%
Renewable 100 Premium 1¢ 0.75¢ 0.25¢
Ava has updated the value proposition three times. Bright Choice was at a 1% savings 2020-2022 years.

Generation
Rate Discount
to PG&E
2026 Revenue
Contribution - Bright
Choice ($MM)
4% 6.3
3% 12.6
2% 18.8
1% 25.1
0% 31.4
¢ per kWh
Adder to PG&E
2026 Revenue
Contribution -
Renewable 100 ($MM)

0.5 6.6

0.75 13.3

1.0 19.9

1.25 26.5

1.5 33.2
Bright Choice
Discount, Renewable
100 Adder
2026 Revenue
Contribution
($MM)
4%, 0.5¢ 12.9
3%, 0.75¢ 25.8
2%, 1.0¢ 38.7
1%, 1.25¢ 51.7
0%, 1.5¢ 64.6
Bright Choice and Renewable 100 value proposition adjustments scenarios Attachment Staff Report Item 14D
Recommended Adjustments to Value Proposition
Staff recommends adjusting the value proposition, effective January 2026 to:
• 1% savings for Bright Choice
• Renewable 100 at a 1.25¢ premium to PG&E
Note:
• Historically, when rates are high Ava's Bright Choice discount has increased and when rates are low, the discount has decreased
• Renewable 100 at a 1.25¢ premium in 2026 is 20% lower than 2025’s Bright Choice rate Ava Generation
Plus PCIA
Average Residential Rate ($/kWh) Percent Rate Decrease
2025 2026,
Current
2026,
Proposed
2025 to 2026,
Current
2025 to 2026,
Proposed
Bright Choice 0.1422 0.0969 0.1003 32% 29%
Renewable 100 0.1522 0.1038 0.1138 32% 25%
Attachment Staff Report Item 14D
Value Proposition Update Schedule
Protocol Event Schedule (approx)
Present to Full Board (Added step to the required protocol) 11/19 Present rates to Executive Committee 12/3
Two community webinars 11/24 - 12/5
Receive written comments. 11/20 - 12/8
Presentation to Community Advisory Committee 12/15
Present findings & feedback from Exec Committee, CAC, public webinar, and written comments to the Board prior to a decision 12/17
Protocol adopted on 5/18/2022
Ava follows the Board-adopted protocol in updating the Ava value proposition:

Attachment Staff Report Item 14D
Ava Customer Savings and Value
$174 million
Total customer savings since 2018
$115 million
Reinvested in our communities since 2018 through
programs, such as:
• Local Infrastructure
▪ Critical Municipal Facilities
▪ Ava Charge
• Programs
▪ Ava Bike Electric
▪ SmartHome Charging
▪ Health-e Communities
• Local sponsorships
• Community grants
• Local vendor spending
$40 million
Paid to date for local generation, driving economic
development, local union jobs, and tax revenue
• Scott Haggerty Wind Energy Center
• Kola Battery Storage System
In 2024, Bright Choice was 60% eligible renewable
energy (96% carbon-free) at lower rates than PG&E
Bright Choice Renewable 100 PG&E
Attachment Staff Report Item 14D
2024-25 Budget Surplus On-bill credits moved to RSF
Staff recommends directing 100% of the 2024-25 budget surplus to RSF Fiscal Year 2024-25 budget surplus allocation was amended at Sept 17, 2025 Board meeting ● 90% of surplus net revenues to be allocated to the Rate Stabilization Fund ● 10% to on-bill credits for CARE/FERA customers $13,041,710 ○ Potential for one-time $80 on-bill credit
Previous on-bill credits provided to CARE/FERA customer bills:
● $100 in January 2025
● $50 in November 2023 and August 2022
Generation rates (inclusive of PCIA) are expected to decrease by 30% in 2025 ● Avg monthly CARE Ava generation charges in 2025: $54
● Avg monthly CARE Ava generation charges in 2026 (@ 1% discount): $38 ● Estimated annual generation bill reduction in 2026: $192 ● Customer savings is greater through rate reduction compared to a one-time bill credit ● Note: This does not account for any changes in PG&E’s T&D charges Attachment Staff Report Item 14D
Local Development Budget reduction
• Staff recommends reducing Local Development funding by $10MM, ▪ $6MM from previously non-earmarked funding
▪ $4MM from 2025-26 non-earmarked budget
• Ava has allocated a total of $104.5MM historically 2019-2025 ▪ ~$17.1MM has been fully expensed, the remainder to be spent over the life of the program
▪ Larger budget programs are in execution or late stages of design with most program dollars to be fully spent in next 5-10 years
▪ ~$9.5MM of funding is currently not earmarked for a specific program ▪ Detailed Fund accounting was provided in the March 2025 Board meeting • 2025-2026 budget includes an allocation of $10.2MM to Local Development with $4MM that was not earmarked to a specific program, but intended for future programs Attachment Staff Report Item 14D
Renewable Energy Procurement Adjustments
Base Case:
• Renewable + Hydro = 70.6%
• Utilizes excess procurement
from 2024/2025 to meet target
• Retains ~5% excess hydro for
2027
Estimated savings: n/a
5% Renewable Energy Reduction:
• Renewable + Hydro = 65.6%
• Fully utilizes excess
procurement from 2024/2025
• Requires 5% additional
renewables in 2027
Estimated savings: $8MM
2026 (Base Case)
Renewable 52.7%
Hydro 17.9%
Nuclear 6.5%
Unspecified 22.9%
GHG Emis. intensity 299
2026 (5% RE/Hydro Reduction)
Renewable 47.7%
Hydro 12.9%
Nuclear 6.5%
Unspecified 27.9%
GHG Emis. intensity 352
Excess '24 RE applied 7.3%
Excess '24 Hydro applied 3.1%
Excess '24 RE applied 7.3%
Excess '24 Hydro applied 8%
• Staff recommends future
consideration of adjustments to
lower 2027 procurement targets
• Ava Compliance Period Procurement
covers 2024-2027
• 2024/25 excess procurement = 15.3%
o RE: 7.3% (in 2026 volumes)
o Hydro: 8% (in 2026 volumes)
• 2026 RE + Hydro Ava target: 81%
• 2027 RE + Hydro Ava target: 85%
• A 5% reduction in 2027 renewable
procurement is ~$6MM savings
Note: Scenarios are estimates; exact
savings, PCL %, & emissions to be
determined by actual transactions
Attachment Staff Report Item 14D
Conclusion
• Ava is seeking to reduce overall generation charges by 25-30% in 2026 with Ava's generation component going down 40-50%
• Such a significant rate reduction is projected to lead to a forecasted deficit of ~$247MM for the July 2025 to Dec 2026 timeframe
• Staff is recommending several measures to allow Ava to reduce customer bills and remain competitive to PG&E, while offsetting the forecasted financial deficit • Staff is seeking approval to:
o Direct 100% of the 2024-25 budget surplus to RSF
o Reduce local development funding by $10MM from non-earmarked funding o Move forward on the process to adjust the value proposition, effective January 2026 to:
▪ 1% savings for Bright Choice and Renewable 100 at a 1.25¢ premium to PG&E ▪ To be formally voted out by Board on Dec 17, 2025 following public comment o Utilize up to the full Rate Stabilization Fund in 2026 to manage the financial deficit (a formal review and authorization to come with the 2026-27 budget cycle) o Consider future adjustments to 2027 energy procurement targets Attachment Staff Report Item 14D

Ava Community Energy Board of DirectorsDecember 17, 2025

Ava Community Energy Board of Directors
December 17, 2025