Staff Report Item 6
Staff Report Item 6
To: Ava Community Energy Authority Executive Committee
From: Kelly Brezovec, Sr. Director, Account Services
Subject: Seeking feedback from the Executive Committee on a recommended extension of Ava’s agreement with Sacramento Municipal Utility District for Call Center and Data Management Services, starting at the end of the current agreement, January 1, 2027, concluding on December 31, 2029.
Date: October 7, 2026
__________________________________________________________________ Summary/Recommendation
Sacramento Municipal Utility District (SMUD) provides critical Customer Care and Data Management Services (CCDMS) to Ava via a contract priced at a per-meter monthly service fee. The current two-year contract started on January 1, 2025, and ends on December 31, 2026.
The proposed agreement was discussed at the January 2026 Executive Committee meeting in connection with Ava’s updated procurement policy. The Board-adopted policy classifies Customer Care and Data Management Services as a “Mission Critical Service,” which does not require a public Request for Proposals when three criteria are met.
These services meet all three criteria: they are essential to issuing more than 8 million bills annually and receiving customer payments; alternatives are limited, and transitioning providers would be complex and disruptive; and any service interruption could cause significant financial and reputational harm by affecting billing, payments, and customer interactions. SMUD is meeting Ava’s needs, and the Executive Committee recommended continuing the partnership.
Staff Report Item 6
The proposed new contract sees a price increase from $1.10 to $1.13 per meter with an annual escalation tied to inflation. Staff has negotiated elements of the agreement, such as lower fixed fees for customer credits, included twice-annual updates of customer-facing web, phone, and email templates, and tighter schedule controls for billing system enhancements.
Staff seeks feedback from the Executive Committee on a recommended contract extension with SMUD for Call Center and Data Management Services for a three-year term, from January 1, 2027, through December 31, 2029.
Financial Impact
Ava has worked with SMUD since 2018, when Ava first started serving customers. The contract has been priced at a monthly, per meter rate with additional fees for new programs or enhancements.
Per Meter
Price
% Annual Increase Estimated
Annual
2018-2021 $1.05 $7 MM - $8.8 MM
2022-2024 $1.00 -4.7% $8.5 MM
(including Share
My Data fee)
2025-2026 $1.10 10% $10.9 MM
2027 $1.13 2.7% $11.1 MM
2028 $1.15 - $1.17 2-3.5% $11.5 MM
2029 $1.19 - $1.20 2-3.5% (based on $1.16 in
2028)
$12.1 MM
Table 1: Historical and proposed future pricing of Ava’s contract with SMUD for CCDMS services
The annual cost, based on meters served, is expected at $11.1 million in 2027, increasing in 2028 and 2029 due to both an increase in per meter fee and growth, to $11.5 to $12.1 million per year. The growth figure was aligned with California’s Housing Element Law.
Term
In January 2026, staff brought an item to the Executive Committee to identify that this set of services would be exempt from a Request for Proposal (RFP), due to changes to the Procurement Policy. The Executive Committee agreed that no RFP was needed, agreeing that SMUD provides mission-critical products and services, which is exempt from the RFP requirement, even though the last RFP was more than five years prior.
The Policy referenced in that memo was amended by a new adopted policy in April 2026; this new policy does not change the RFP requirements for "mission-critical products and services."
Staff Report Item 6
Analysis and Context
Service and history
CCAs contract with third parties for data management services, and often, call center services (Call Center and Data Management Services, or CCDMS). SMUD, as Ava’s CCDMS provider, is responsible for critical operational services, including:
• Billing operations
• Data management
• Call center/customer service representatives
Sample activities:
Service Activities
Billing operations Ingest billing determinants from PG&E Send bill-ready billing information to PG&E
Apply payments to customer accounts
Data management Data feed conduit between PG&E and Ava
Develop and share customer characteristic reports
Ingest and share interval data feeds
Call center Respond to customer inquiries via chat, email, and phone Manage customer enrollment via web forms and IVR service Continue to update knowledge base with information about Ava programs
Table 2: Sample Activities of a CCDMS provider
Select updates to the new agreement
While the bulk of the services SMUD provides are standard, such as providing the billing information to PG&E, there are some opportunities for negotiation and inclusion of updated pricing and services. Table 3 highlights some of these differences.
Item 2025-2026 2027-2029
Per meter fee $1.10 $1.13
Common enhancements
and updates
Scheduled pricing, set
at current rates
Scheduled pricing, increased
due to inflation. Lower prices
for customer on-bill credits.
Updates to customer-facing phone, webform,
email
$50k spent in 2026 Twice annual updates
included
Returning client credit n/a $1 million credit available as part of a 3-year term
Project management
standards
n/a Both parties to agree to
deadlines for planned
enhancement projects
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Table 3: Agreement updates
Special consideration: alternative providers
Staff regularly monitors the energy services market and engages with potential providers and peer agencies to assess available alternatives. Based on this ongoing market review, staff has not identified another provider that currently offers the combination of customer call center capabilities, service customization, and utility operations expertise Ava receives from SMUD. CCAs in California work with either SMUD or Calpine Energy Solutions for data management requirements. Staff’s evaluation indicates that Calpine, acquired by energy provider Constellation in 2025, does not fully meet Ava’s customized operational and customer service needs. Staff will continue to monitor the market and evaluate emerging alternatives and intends to conduct a formal competitive process when market conditions and Ava’s needs make doing so appropriate.
Next Steps
Staff will bring the recommendation and feedback from the Executive Committee to the Board of Directors on Wednesday, October 21, 2026 as an item on the consent agenda.
Attachment
A. PowerPoint
SMUD Agreement Extension
for Customer Care and Data
Management Services
Kelly Birdwell Brezovec| October 7, 2026
Attachment Staff Report Item 6A
Agenda • Background • Summary • Pricing • Alternatives • Next steps 2 Attachment Staff Report Item 6A
Background • Sacramento Municipal Utility District (SMUD) provides critical Customer Care and Data Management Services
(CCDMS) to Ava via a contract priced at a per-meter monthly service fee
• SMUD has provided these critical services since the start of service in 2018
• The current two-year contract started on January 1, 2025, and ends on December 31, 2026
• Services qualify as "mission critical," under Ava's 2025 and new 2026 procurement policy, which removes the
requirement for an RFP
o Essential operations are dependent upon product or service o Difficulty of finding and transitioning to an alternative supplier o Degree of financial and/or reputational harm due to an outage in this service
• Staff proposes entering into a three-year agreement starting January 1, 2027
3 Attachment Staff Report Item 6A
Summary: New Agreement
• The proposed new contract sees a price increase from $1.10 to $1.13 per meter with an annual escalation tied to inflation.
• Staff has updated and negotiated elements of the agreement, including
▪ Lower fixed fees for customer credits
▪ Included twice-annual updates of customer-facing web, phone, and email templates
▪ Tighter schedule controls for billing system enhancements 4 Attachment Staff Report Item 6A
Pricing Detail
5 2028-2029 are forecast, based on expected inflation and growth Per Meter Price % Annual Increase Estimated Annual
2018-2021 $1.05 $7 MM - $8.8 MM
2022-2024 $1.00 -4.7% $8.5 MM (including
Share My Data fee)
2025-2026 $1.10 10% $10.9 MM
2027 $1.13 2.7% $11.1 MM
2028 $1.15 - $1.17 2-3.5% $11.5 MM
2029 $1.19 - $1.20 2-3.5% (based on $1.16 in 2028) $12.1 MM Attachment Staff Report Item 6A
Alternatives
• Staff regularly monitors the market and engages with potential providers and peer agencies
• Current options for California CCAs are limited to SMUD and Calpine Energy Solutions
▪ Calpine does not fully meet Ava’s customized operational and customer service needs
• Staff will continue evaluating alternatives and conduct a formal competitive process when appropriate
6 Attachment Staff Report Item 6A
Next Steps
7 • Staff seeks feedback from the Executive Committee on a contract extension with SMUD for Call Center and Data Management Services for a three-year term, from January 1, 2027, through December 31, 2029.
• Ava legal team finalizes the agreement
• Staff to bring the item to the October Board meeting on the Consent Agenda
Attachment Staff Report Item 6A
Attachment Staff Report Item 6A