Agenda packet — Central Coast Community Energy (3CE) Policy Board, June 18, 2025 (part 1 of 2)

Policy Board of Directors
June 18, 2025
1:30pm
Central Coast Community Energy
70 Garden Court, Suite 300
Monterey, CA 93940

REMOTE LOCATION VIA TELECONFERENCE
Any interested parties or community members may attend, and participate in, the meeting at the following addresses where Board members may also join the meeting from:

County of Santa Cruz
701 Ocean Street, Fifth Floor Redwood Room
Santa Cruz, CA 95060
City of Scotts Valley
City Hall
1 Civic Center Dr
Scotts Valley, CA 95066
County of Monterey
168 West Alisal St, 3rd Floor
Salinas, CA 93901
City of Salinas
City Hall
200 Lincoln Ave, CM Conference Room
Salinas, CA 93901
City of Greenfield
108 El Camino Real
Greenfield, CA 93927
County of San Luis Obispo
Katcho Achadjian Government Center
1055 Monterey Street, Fourth Floor
BOS Conference Room
San Luis Obispo, CA 93408
City of Santa Maria
City Hall
110 East Cook Street, Council Chambers
Santa Maria, CA 93454
County of Santa Barbara
County Administration Building
105 East Anapamu Street,
Fourth Floor
Santa Barbara, CA 93101
Garden Grove
11999 Harbor Blvd
Garden Grove, CA 92840
Visalia
Visalia Marriott at the Convention Center
300 S Court St
Visalia, CA 93291
Public may participate through ZOOM. For ZOOM participation please join by computer audio at:
https://us02web.zoom.us/j/83507087702
Or join by phone:
+1 669 900 6833 or +1 669 219 2599
Enter this Webinar ID Number: 835 0708 7702 when prompted. Please note there is no Participant Code, you will press # again after the recording prompts you.

You will be placed in the meeting as an attendee. To make a public comment:
 If joined by computer, please press the button to raise your hand  If joined by phone, please push *9 on your keypad
If you have anything that you wish to be distributed to the Board, please provide 15 copies to a member of 3CE staff or the Board Clerk, who will distribute the information to the Board members and staff.

The public may comment on the consent agenda and matters not listed on the agenda but within the Board's jurisdiction at the opening of the meeting. The Board may not take action at this meeting on any item not listed on the Agenda other than to refer the matter to staff or set it for a future meeting. The public may comment on a specific item listed on this agenda when the Board considers that item.

Speakers are limited to 3 minutes each.

In addition, members of the public may request and receive copies without undue delay of any documents that are distributed to the Board, unless there is a specific exemption under the Public Records Act that prevents the disclosure of the record. (Cal. Gov’t Code Section 54957.5) In compliance with Government Code Section 54957.5, non-exempt writings that are distributed to a majority or all of the Board in advance of a meeting and that relate to an agenda item will be made available at 3CE’s offices located at 70 Garden Court, Suite 300, Monterey, CA 93940 during normal business hours and are also available on the 3CE website located at: https://pub-3ce.escribemeetings.com/ REASONABLE ACCOMMODATIONS: In compliance with the Americans with Disabilities Act, any individuals who desire to request a reasonable accommodation or modification to observe or participate in the meeting may make such a request by sending an email to: [email protected] Copies of documents may be made in alternative formats, upon request. Requests for accommodations should be made no later than two (2) business days prior to the meeting to allow time for 3CE to address the request.

DISCLOSURE OF CAMPAIGN CONTRIBUTIONS: Pursuant to Government Code section 84308, members of the Board are disqualified and not able to participate in any agenda item involving contracts (other than competitively bid, labor, or personal employment contracts), franchises, discretionary land use permits and other entitlements if the Board member received more than $250 in campaign contributions from the applicant or contractor, an agent of the applicant or contractor, or any financially interested participant who actively supports or opposes the decision on the agenda item since January 1, 2023. Members of the Board who have received, and applicants, contractors or their agents who have made, campaign contributions totaling more than $250 to a Board member during the proceeding or for 12 months after a final decision is rendered in that proceeding, are required to disclose that fact for the official record of the subject proceeding. Disclosures must include the amount of the campaign contribution and identify the recipient Board member and may be made either in writing to the Clerk of the Board prior to the subject hearing or by verbal disclosure at the time of the hearing.

Welcome & Roll Call
Pledge of Allegiance
Corrections or Additions
The Clerk will announce agenda corrections or proposed additions of emergency, urgency, or continued items, which will be acted on by the Board as provided in Section 54954.2 of the California Government Code.

Public Comment on Items on the Consent Calendar and Items Not listed on the Agenda The public may address the Board on the Consent Calendar and any matter within the jurisdiction of the Board but not on the agenda.

CONSENT CALENDAR

1. Approve minutes from the March 19, 2025, meeting of the Policy Board

2. Adopt resolution No. PB-2025-03 approving the FY 2025-26 Financial Policies

3. Adopt Resolution No. PB-2025-04 delegating authority to the Executive Committee to: (1) approve Capital Improvement Projects in an amount not to exceed $5,000,000, and (2) authorize the CEO to enter agreements to effectuate the projects

4. Accept FY 2023-24 Energy Programs Portfolio Evaluation report

5. Financial report for the period October 1, 2024, through March 31, 2025

6. Investment performance report for the period of October 1, 2024, through March 21, 2025

7. Energy Programs Update

8. Quarterly Regulatory and Legislative Update

REGULAR AGENDA

9. CEO Report
a. Welcome Chief Operating Officer Byron Vosburg
b. 3CE's Future Leaders Internship Program Begins Second Year c. Reliable Clean Power Procurement Program
d. Power Charge Indifference Adjustment (PCIA) Proceeding Update e. Large Load Advocacy
f. Community Advisory Council Report

10. Update on the FY 2024-25 Underserved Communities Outreach and Engagement Action Plan

11. a. Approve an Electric Vehicle charger capital improvement project at 3CE’s office located at 2601 Porter Street in Soquel; and b. Authorize the Chief Executive Officer to execute necessary vendor contracts to implement the improvements at 2601 Porter
Street in Soquel with a total budget not to exceed amount of $261,778

12. Presentation on the FY 2024-25 Mid-Year Budget Forecast Board member comments and reports
Adjournment

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Policy Board of Directors
March 19, 2025
Regular Meeting
1:30PM
Central Coast Community Energy
70 Garden Court,
Suite 300
Monterey, CA 93940
County of Santa Cruz
701 Ocean Street,
Third Floor Training Room
Santa Cruz, CA 95060
City of Greenfield
108 El Camino Real
Greenfield, CA 93927
City of Santa Maria
City Hall
110 East Cook Street,
Council Chambers
Santa Maria, CA 93454
County of San Luis Obispo
Katcho Achadjian Government
Center 1055 Monterey Street,
Board of Supervisors Chambers
San Luis Obispo, CA 93408
County of Santa Barbara
County Administration Building 105
East Anapamu Street, Fourth Floor
Santa Barbara, CA 93101

MINUTES
The meeting was called to order at 1:30 PM with 15 members attending from 6 noticed locations and a quorum established.

Director’s Present:

HQ: Barajas, Curro, Daniels, Carbone, Williams (arrived at 1:40PM) County of Santa Cruz: Timms (arrived at 1:55PM)
City of Greenfield: White
County of San Luis Obispo: Bourbeau, Dutra, Guthrie, Hartmann (arrived at 1:35PM), Martinez, Wixom, Vice Chair Ortiz-Legg, Chair Keeley
City of Santa Maria: Patino
County of Santa Barbara: Reyes- Martin, Silva
Directors Absent: Resendiz
Chair called for Corrections or Additions to the agenda.

Clerk announced the following correction for item 8:
 Attachment B includes revisions to electric generation rates for 9 rate codes, which were corrected to mitigate a spike in the peak period rate and align closer to the rate design of the other rate codes in the pertain classes.

PRESENTATION

1. Received a presentation on the 2024 Annual Impact Report

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Chair opened public comments
The following individual(s) addressed the Board.
 Marilyn Garrett
Chair closed public comment period.

Chair closed public comment.

CONSENT CALENDAR
Chair opened public comment period on the consent calendar and items not listed on the agenda.

The following individual(s) addressed the Board.
 Rachel Sotos
 Marilyn Garrett
 Nina Adino
 James Ewing Whitman
Chair closed public comment period.

MOTION: Moved by Director Dutra, seconded by Director Hartmann to approve the consent calendar as submitted.

ACTION: Motion carried with a roll call vote: 18/0/1
AYES: Barajas, Bourbeau, Curro, Daniels, Carbone, Dutra, Guthrie, Hartmann, Martinez, Patino, Reyes – Martin, Silva, Timm, White, Williamson, Wixom, Vice Chair Ortiz-Legg, Chair Keeley NOES: None
ABSENT: Resendiz

2. Approved minutes from the December 11, 2024, meeting of the Policy Board of Directors

3. Updated on 3CE's Energy Programs

4. Regulatory and Legislative Quarterly Update

5. Financial report for the period October 1, 2024, through December 31, 2024

6. Investment Performance Report for the period of October 1, 2023 through September 30, 2024

7. Investment Performance Report for the period of October 1, 2024 through December 31, 2024

8. Adopted Resolution No. PB-2025-01 establishing a Claims Procedure Pursuant to Government Code Section 935

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REGULAR AGENDA

9. CEO Repot
a. Staffing Updates
b. Community Advisory Council Report
c. EV Charger Asset Pilot Update Power Supply Update
d. California Public Utilities Commission Action on General Order 167 Chair opened public comment period.

The following individual(s) addressed the Board.
 Marilyn Garrett
 James Ewing Whitman
 Michelle Clary
 Rachel Sotos
Chair closed public comment period.

ACTION: Discussion item; no action required.

10. Received a presentation on the Power Charge Indifference Adjustment and provide staff with the following direction

1. Continue working with CalCCA and the Executive Committee to develop a strategic and thoughtful regulatory approach that seeks to reduce PCIA volatility; allows Load Serving Entities plan around PCIA fluctuations, while still working to benefit all Californians.

2. Staff should work closely with our Energy Risk Management Committee and the Operations Board to review procurement and risk management strategies in a manner to address and mitigate negative regulatory impacts from PCIA rulemaking.

3. Work closely with the Audit and Finance Committee and/or Executive Committee, as appropriate, to consider adjusting reserve levels necessary to build stable and predictable rate structures for customers.

Chair opened public comment period.

The following individual(s) addressed the Board.
 Michelle Clary
 Marilyn Garrett
Chair closed public comment period.

MOTION: Moved by Director Martinez, seconded by Director Hartmann to approve the aforementioned direction.

ACTION: Motion carried with a roll call vote: 18/0/1

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AYES: Barajas, Bourbeau, Curro, Daniels, Carbone, Dutra, Guthrie, Hartmann, Martinez, Patino, Reyes – Martin, Silva, Timm, White, Williamson, Wixom, Vice Chair Ortiz-Legg, Chair Keeley NOES: None
ABSENT: Resendiz

11. Received a presentation on 3CE's FY 2023-24 audited financial statements Chair opened public comment period.

The following individual(s) addressed the Board.
 Marilyn Garrett
Chair closed public comment period.

MOTION: Moved by Director Dutra, seconded by Director Guthrie to approve ACTION: Motion carried with a roll call vote: 18/0/1
AYES: Barajas, Bourbeau, Curro, Daniels, Carbone, Dutra, Guthrie, Hartmann, Martinez, Patino, Reyes – Martin, Silva, Timm, White, Williamson, Wixom, Vice Chair Ortiz-Legg, Chair Keeley NOES: None
ABSENT: Resendiz

12. Adopted Resolution No. PB-2025-02 approving adjustments to the calendar year 2025 electric generation rates effective April 1, 2025
Chair opened public comment period.

The following individual(s) addressed the Board.
 Marilyn Garrett
 Michelle Clary
Chair closed public comment period.

MOTION: Moved by Vice Chair Ortiz- Legg, seconded by Director Martinez to approve.

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CLOSED SESSION

11. Closed session under Government Code 54950 et.seq. relating to the following item:
a. Pursuant to Government Code section 54957(b), the Board will confer regarding evaluation of performance for the Chief Executive Officer
Chair opened public comment period.

The following individual(s) addressed the Board.
 Michelle Clary
Chair closed public comment period.

General Counsel announced that no reportable action would be taken, and that the meeting would adjourn out of closed session.

Recessed into closed session at 5:03 PM
Adjourned at 5:36 PM

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Staff Report Item 2
TO: 3CE Policy Board of Directors
FROM: Robert M. Shaw, Chief Executive Officer
PREPARED BY: Juan Lopez, Director of Finance
SUBJECT: Adopt Resolution No. PB-2025-03 approving the FY 2025-26 Financial Policies DATE: June 18, 2025
RECOMMENDATION:

Consider adopting Resolution No. PB 2025-03 approving the Fiscal Year 2025-26 Financial Policies.

BACKGROUND:

The Policy Board adopts 3CE’s Financial Policies (Policies) annually as part of the budget development process to ensure alignment between the agency’s fiscal framework and strategic objectives. This recurring adoption process keeps the Policy Board appraised of 3CE’s financial management practices and affirms the foundation for the Recommended Budget.

The Policies have undergone significant revisions in recent years, including consolidating administrative and accounting policies into a single, comprehensive framework. Notable updates included establishing reserve types such as the Strategic Reserve, Energy Rate Stabilization Reserve, Renewable Energy Innovation and Initiatives Reserve, and Capital Infrastructure Reserve. The FY 2024-25 Policies also introduced a key shift in how reserves are measured, moving from net position to readily available liquidity to more accurately reflect 3CE’s fiscal resiliency.

Staff received input from the Audit & Finance Committee on the proposed FY 2025-26 Financial Policies at a special meeting on May 21, 2025.

DISCUSSION/ANALYSIS:

The FY 2025-26 Financial Policies build on the work of the current year’s Financial Policies. This year's proposed changes to the Financial Policies center around the Energy Rate Stabilization Reserve. Minor

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revisions to reduce the redundancy of terms and grammatical improvements are also outlined in the redlined version of Financial Policies, which is attached.

Staff recommends clarifying the purpose and use of the Energy Rate Stabilization Reserve to better reflect its role in supporting long-term rate stability, which sustains customer trust and mitigates opt-out risks. The revised language emphasizes the reserve's strategic value in smoothing rates during periods of market and regulatory volatility and outlines expectations for transparency and reserve replenishment when funds are used. This change strengthens the policy framework by aligning financial planning with 3CE’s goals of delivering reliable, clean electricity at fair rates.

FISCAL IMPACT:

Adopting the FY 2025-26 Financial Policies promotes financial sustainability, provides clear fiscal guidance, and positions 3CE to adapt to volatile market and regulatory events.

CONCLUSION:

An annual update to the Financial Policies ensures that 3CE develops its recommended budget backed by a practical framework for overall fiscal planning and management.

ATTACHMENT(S):

1. Draft Resolution No. PB-2025-03

2. FY 2025-26 Financial Policies – Redlined

3. FY 2025-26 Financial Policies

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DRAFT RESOLUTION NO. PB-2025-03

A RESOLUTION OF THE CENTRAL COAST COMMUNITY ENERGY POLICY BOARD OF DIRECTORS ADOPTING THE FY 2025-26 FINANCIAL POLICIES.

WHEREAS, the Policy Board of Central Coast Community Energy (“3CE”) adopts Financial Policies annually as part of the budget development process to ensure alignment between the agency’s fiscal framework and its strategic objectives; WHEREAS, 3CE’s Financial Policies provide fundamental guidance for financial planning and management, helping the agency navigate uncertainties that have fiscal impacts like energy market volatility, regulatory changes, and customer impacts; WHEREAS, in recent years, 3CE has consolidated its administrative and accounting policies into a single comprehensive framework, including the establishment of dedicated reserves; WHEREAS, the FY 2024-25 Financial Policies introduced a shift in measuring reserve targets from net position to readily available liquidity to better reflect 3CE’s fiscal resiliency and reserve targets to meet operational needs;
WHEREAS, for FY 2025-26, 3CE staff propose clarifying the purpose and application of the Energy Rate Stabilization Reserve to strengthen its strategic role in supporting rate stability, customer retention, and long-term competitiveness; and
WHEREAS, the proposed revisions also include minor grammatical corrections and formatting adjustments that improve policy clarity and consistency.

NOW, THEREFORE, THE CENTRAL COAST COMMUNITY ENERGY POLICY BOARD OF DIRECTORS DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS:

1. The Policy Board hereby adopts:
a. FY 2025-26 Financial Policies attached hereto as Attachment B, as the official financial framework guiding budget development and fiscal planning for the upcoming year.

PASSED AND ADOPTED this 18th Day of June 2025, by the following vote:

AYES:

NOES:

ABSENT:
__________________________________
Chair, Fred Keeley
Attest:

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__________________________________
Board Clerk, Heather Vowell

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ATTACHMENT A – FINANCIAL POLICIES (redlined)

1.0 Purpose and Background
The prudent and responsible stewardship of public assets is a principal obligation of 3CE officials and managers. The development and maintenance of financial policies enable 3CE officials to protect those public assets, ensure transparency, and build public trust. Financial policies define a shared understanding of how 3CE administers its financial affairs and communicates how the agency manages its resources to provide the highest value to the communities served.

This document centralizes 3CE’s financial policies and establishes a framework for overall fiscal planning, management, and decision-making related to public assets controlled by 3CE. These policies are reviewed, updated, and brought before the Policy Board as needed but at least annually for adoption. This continued review and adoption promotes sound financial management and helps maintain 3CE’s stability, efficiency, and effectiveness by ensuring the Policy Board’s financial policy guidance is provided before 3CE takes any financial actions. The policies also offer guidelines for evaluating both current activities and proposals for future programs and direct 3CE’s financial resources toward meeting its objectives and strategic initiatives.

These policies provide general guidance in the management of the 3CE’s fiscal affairs and are to be used by all 3CE employees to meet their obligation to operate in a financially prudent manner.

The Recommended Budget is developed in accordance with this framework.

2.0 General Financial Policy
The cornerstone and highest priority of 3CE’s financial policies is fiscal integrity. It shall be the goal of 3CE to achieve a strong financial condition with the ability to:
• Sustain adequate financial liquidity to meet normal operating and contingent obligations;
• Ensure a sufficient financial base is maintained to withstand local, regional, national, and global economic impacts;
• Foster the ability to adjust efficiently to the community’s changing service requirements;
• Maintain and improve infrastructure and capital assets; • Regularly review programs and operational methods to improve processes that result in higher productivity and eliminate repetitive and duplicative functions; • Encourage collaboration with other government entities, the private sector, and public-private partnerships where cost and risk are minimized in the delivery of services within 3CE’s service area;
• Promote sharing of costs and benefits by service users; • Ensure the legal use of financial resources through an effective system of internal controls;

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• Support sound financial management by providing accurate and timely information on 3CE’s financial condition; and
• Provide a framework for the wise and prudent use of debt financing and maintain a strong credit rating in the financial community.

Through the CEO, the Chief Financial Officer (CFO) will consult with 3CE Officers and seek their input in developing the Recommended Budget through cooperative discussions and financial education. The CEO will keep the Policy Board apprised of the condition of the 3CE’s finances and emerging fiscal issues. Through the CEO and Officers, 3CE will work with the California Community Choice Association (CalCCA), state representatives, legislative advocates in the State Capitol, and other local government organizations to ensure our community voice is heard regarding any state legislation or regulation affecting our stakeholders.

3.0 Roles and Functions

3.1 Role of Chief Executive Officer
The CEO serves as the chief policy advisor to the Policy Board, Operations Board, and the various Board committees. The CEO promotes responsible resource allocation, strives to protect 3CE’s financial position and integrity, and provides independent analysis on policy and financial issues.

The CEO is the fund manager for the 3CE Enterprise Fund and any other funds that may be created.

3.2 Principal Functions of the Chief Executive Officer
Principal functions of the CEO include:
• Promoting continuous improvement of the structures, systems, processes, and effectiveness of programs;
• Preparing the annual financial plan (Recommended Budget); • Working with departments to evaluate potential federal, state, and local budget impacts; • Developing financial forecasts;
• Monitoring revenues and expenditures for conformance with the annual budget; • Recommending effective fiscal policies to carry out the 3CE mission; • Verifying Policy Board policies are consistently applied; and • Ensuring items brought before the Policy Board are transparent, accurate, complete, fully justified, and reviewed by appropriate stakeholders.

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3.3 Principal Functions of the Chief Financial Officer
The CFO is 3CE’s Policy Board appointed Treasurer and considered the subject matter expert for the financial management of the agency. The CFO is responsible for:
• Carrying out financial operations efficiently and cost-effectively while adhering to all 3CE, state, and federal laws, regulations, and policies; • Preparing budgets and financial estimates with attention to accuracy based on financial expertise, 3CE, state, and federal funding changes, and economic indicators affecting revenues, expenditures, and service levels;
• Reviewing, evaluating, and assessing potential federal and state budget issues that may impact the agency;
• Developing and performing financial forecasts;
• Overseeing Middle Office responsibilities as identified in 3CE’s Energy Risk Management Policy;
• Monitoring monthly revenue, expenditure, and cash flow performance and conformance with the Adopted Budget;
• Meeting the Policy Board’s strategic financial initiatives and policies; and • Ensuring items brought before the Policy Board are transparent, accurate, complete, fully justified, and reviewed by all appropriate stakeholders.

3.4 Principal Functions of the Audit and Finance Committee The Audit and Finance Committee’s principal functions include receiving staff updates on financial issues affecting 3CE and providing oversight and direction to staff in developing and modifying the budget and audits.

3.5 Principal Functions of the Energy Risk Management Committee The Energy Risk Management Committee is formed by the CEO to implement and maintain the Energy Risk Management Policy, which requires 3CE to maintain sufficient financial reserves to:
• Establish long-term business sustainability;
• Build collateral for power procurement activities;
• Maintain an investment-grade credit rating;
• Develop funding sources for investment in generation and other local initiatives; and • Reduce the business and customer impact of year-to-year volatility in energy markets and procurement costs.

4.0 Services and Fund Structure

4.1 Enterprise Fund
3CE operates as an enterprise fund. The enterprise fund accounts for revenues and expenditures for all 3CE activities. The fund’s operations are financed and operated like private business enterprises, where services provided are primarily funded through user charges (electric generation rates).

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4.2 Proprietary Fund
An enterprise fund is classified as a proprietary fund and is financed and operated like private business enterprises whose services are primarily funded through user charges.

4.3 Expenses
Enterprise fund expenses and revenues will be established at sufficient levels to properly maintain the fund’s infrastructure and provide significant capital development.

4.4 Rate Structure and Net Position
The enterprise fund will maintain an adequate rate structure to cover the cost of all operations, including cash flow, capital replacement and maintenance, debt service if applicable, contingency funding, reserve contributions, and depreciation. Rates may be offset from the available unreserved net position only after these requirements are met.

5.0 Operating Budget

5.1 The Budget
The Recommended Budget is the central financial planning document that the agency’s goals, objectives, priorities, levels of service, and the associated operating revenue and expenditures.

Appropriations are recommended based on the relationship between expected expenditures and revenue. If revenues are estimated to fall below expected amounts, the agency will take all actions available to reestablish a revenue and expenditure relationship that conforms to the operating requirements.

The Recommended Budget shall be presented to the Policy Board for adoption in September of each year and clearly presented to a general audience of the public. The Recommended Budget may be modified as necessary by the Policy Board during the fiscal year.

5.2 Balance Budget
A budget is balanced when the total estimated financing sources (beginning fund balance plus revenues) equal the total appropriations (expenditures). At no time shall spending in a given year exceed total current estimated revenues plus any net positive position (reserved and non-reserved).

5.3 Ongoing Operations Needs
3CE will adequately fund ongoing maintenance and operational needs with ongoing annual revenue. Without prior direction and approval by the Policy Board, the use of one-time revenues or short-term borrowing is not allowed as a resource to finance ongoing operational needs.

5.4 Capital Facilities and Equipment
3CE shall establish as a primary fiscal responsibility the acquisition, preservation, maintenance, improvement, and, when applicable, orderly replacement of the 3CE’s capital facilities and equipment. 3CE shall endeavor to purchase a permanent headquarters and appropriate regional offices to provide continuity of location and operations while stabilizing and controlling facility

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costs into the future. 3CE will acquire and maintain high-quality equipment to maximize useful life and ensure efficient operations.

5.5 Appropriations and Transfers
The agency enterprise fund is not constrained by appropriation controls. The CEO is charged with maintaining the relationship between financing uses and financing sources and shall report to the Policy Board any deviation in excess of the adopted budget. The CEO is authorized to make appropriation transfers between departments and divisions within the enterprise fund as necessary to adequately reflect the expenditure needs of the agency.

5.6 Responsibility for Budget Management and Budgetary Control The 3CE shall maintain a budgetary control system to help it adhere to the adopted budget. The CEO has budgetary control and authority over appropriations. The CFO shall administer and maintain the system utilized for budgetary control. As the administrator of the budgetary control system, the CFO shall notify the CEO when a department is reaching the departmental appropriation limit. The CFO shall seek guidance from the CEO on all issues relating to appropriations and controls.
3CE Officers in coordination with the CFO have primary responsibility for managing departmental budgets by:
• Providing accurate and timely budget estimates;
• Monitoring revenues to ensure timely receipt in the amounts anticipated; • Ensuring that expenditures comply with the law, adopted resolutions, policies, and align appropriations relative to revenues;
• Providing prompt notification to the CEO when either revenues or expenditures are not as anticipated; and
• Preparing and justifying budget revisions when necessary

5.7 Preparation of Financial Reports
The CEO annually prepares or causes to be prepared:
• An Annual Comprehensive Financial Report (ACFR) that reports on the 3CE’s financial position and activities adhering to Generally Accepted Accounting Principles (GAAP) or state law requirements, to provide readers with a broader understanding of the agency’s financial operations;
• A mid-year estimate to provide current-year performance and forward-looking perspective to advise the Policy Board on future challenges and provide a base for building the following year’s Recommended Budget; and
• Additional reports, as appropriate, to keep the Policy Board informed on current financial performance and developments.

The CEO has oversight and contract management over the external auditors reviewing the ACFR.

External auditors shall report to the CEO or designated officer on audit findings. The CEO will take the audit findings thereafter to the Policy Board.

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5.8 Publication of Budget
The CEO shall publish annually a Recommended Budget document that satisfies nationally recognized standards for effective budget presentation. The Recommended Budget will be provided to the Policy Board a minimum of two weeks in advance of the annual budget hearings.

5.9 Budget Development
Budget development is an annual process incorporating the Policy Board’s priorities and weighing competing requests for 3CE resources within expected fiscal constraints. The process begins with departments preparing “baseline” budgets proposing levels of service and staffing that can be carried out within expected resources (e.g., revenues). Departments may submit “augmentation requests” for additional resources to mitigate potential impacts, increase staffing/services, or invest in infrastructure. The CEO evaluates baseline budgets and augmentation requests within the constraints of a balanced budget and builds the annual Recommended Budget. Staff considers the following criteria in formulating recommendations for the annual budget and subsequent mid-year budget modifications:
• Mandated by current law, regulation, or Policy Board policy; • Alignment with the 3CE’s strategic initiatives and priorities; • Necessary to maintain the current level of mission-critical services/operations; • Substantiation of compelling public need (e.g., health, safety, economic vitality, quality of life) that cannot be met within existing resources;
• Likelihood of success based on prior performance, degree of planning/specificity, requested resources, and assumed timeline;
• Leverages sustainable financial support from non-3CE sources; • Appropriate placement of responsibility (federal, state, or local); • Degree of urgency; and
• Critical infrastructure investment to ensure productivity and continuity of operations.

Criteria in the listing are not exhaustive or in any particular order, nor are they mutually exclusive; funding recommendations may align with more than one criterion.

5.10 Establish 3CE Priorities
The Policy Board has a continuous process of establishing 3CE priorities for ensuing years. The Policy Board implements these priorities in the Recommended Budget. Understanding that elected officials, appointed officials, and agency officers are charged with the actual provision of services to the community, the Policy Board shall set broad priorities to ensure flexibility for the agency to concentrate on these priorities.

5.11 Amendments to the Adopted Budget
Modifications to the Adopted Budget require the approval of a majority of Policy Board members.

Amendments to the Adopted Budget will be made in compliance with Policy Board policies. As an enterprise fund, the relationship between financing uses and financing sources is the overriding principle; thus, appropriation controls are not required.

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5.12 Budgetary Basis
The 3CE uses the full accrual basis of accounting following GAAP. The budgetary basis is appropriation-based, beginning October 1 and ending the last day of September of each year. 3CE is an enterprise fund that is appropriation-based budgeted; however, accounting is on a full accrual basis.

5.13 Capital Asset Definition
The 3CE defines capital assets as assets with initial, individual costs of $5,000 or more and an estimated useful life greater than one year, except infrastructure, for which the threshold is set at $100,000. Capital assets include both tangible and intangible assets categorized by asset type for reporting purposes.

5.14 Appropriations for Contingencies
3CE annually adopts an appropriation for contingencies to provide sufficient working capital and a margin of safety for unplanned operational needs. The contingency appropriation is utilized only after all other budget resources have been examined. The appropriation for operational contingencies shall be equal to five percent (5%) of recommended appropriations, excluding cost of energy (COE), unless expressly modified by the Policy Board as part of the annual budget adoption.

6.0 Net Position and Reserve Policies

6.1 Net Position
Net position is a measurement of available financial resources. It is the difference between total assets and total liabilities. The Policy Board recognizes that maintaining a positive net position is essential to preserving 3CE’s financial integrity. Sufficient net position and reserve levels are a critical component of the 3CE’s overall financial management strategy. They are key factors in the ability to sustain service delivery and obtain external financing. Rating agencies analyze net position when considering 3CE’s overall financial strength and creditworthiness. Adequate reserves enable flexible financial planning in developing rate structures, future capital projects, dealing with unforeseen emergencies, and changes in general economic conditions.

6.2 Use of Unreserved Net Position
3CE’s goal is to only use unreserved net position as a source to finance one-time investments, reserves, and/or commitments. As a one-time financing source, any end-of-year positive net position will be used for non-recurring expenditures and only after confirmation of the yearly audit.

6.3 Strategic Reserve
A strategic reserve is essential to provide an adequate financial backstop throughout the year. 3CE shall adopt a strategic reserve equal to twenty-five percent (25%) of budgeted appropriations. The strategic reserve will provide sufficient working capital (cash flow), fund settlements of legal judgments against the 3CE in excess of reserves specifically designated for litigation, for natural disasters as determined by the CEO or Policy Board, and for one-time-only budget overruns that could not be addressed through the annual appropriations for contingencies.

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If the strategic reserve is utilized to provide temporary funding for unforeseen needs, 3CE shall take the measures necessary to prevent its use in the following fiscal year by increasing revenues and/or decreasing expenditures to regain balance. 3CE shall also restore the strategic reserve to the minimum level of twenty-five percent (25%) of budgeted appropriations within five fiscal years following the fiscal year in which the event occurred. The plan to restore the strategic reserve shall be included and highlighted in the Recommended Budget.

6.4 Energy Rate Stabilization Reserve
The agency shall maintain an energy rate stabilization reserve equal to twenty (20%) of the budgeted COE. This reserve serves as a financial buffer to absorb fluctuations in energy costs and respond to unforeseen changes in market conditions or regulatory requirements that may increase power procurement expenses that cannot be absorbed by changes to cover recovery efforts, such as electric generation rate adjustments.

A central purpose of this reserve is to support rate smoothing and long-term rate stability. By strategically using this reserve, 3CE may maintain consistent, competitive customer rates even during periods of cost volatility, strengthening its position as a load-serving entity and sustaining customer trust.

Any material or sustained use of the reserve shall be reflected in the Recommended Budget, including a long-term plan to replenish the reserve. This reserve may be utilized throughout the fiscal year at the direction of the CEO with subsequent reporting to the Energy Risk Management Committee and the Boards.

6.5 Renewable Energy Innovation and Initiatives Reserve The agency shall maintain a renewable energy innovation and initiatives reserve equal to five percent (5%) of the budgeted COE. This reserve shall be utilized for investments in furtherance of the Boards’ goals to accelerate the utilization of 100% clean and renewable energy through the commitment to new or emerging, but scalable, technologies that can address the challenges of an intermittent renewable grid and reduce dependency on fossil fuels for electricity generation.

6.6 Capital Infrastructure Reserve
The agency shall establish a capital infrastructure reserve sufficient to provide for the operation, routine scheduled maintenance, reasonably anticipated unplanned repair, and ultimate replacement costs of 3CE’s capital infrastructure, including enterprise software, real estate, and electric generation and storage facilities.

6.7 Measurement of Reserve Targets
Due to the nature of the agency's business, the mechanism to fund the four reserves shall be the use of cash, cash equivalents, and short-term investments. The reserves must be liquid and available to ensure the ability to use the reserves for their intended purpose. Market fluctuations, operational continuity, competitive advantage, and regulatory compliance are risks that are mitigated with robust reserves as the agency transitions to a clean and renewable electric grid.

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7.0 Capital Facilities and Improvement Policies

7.1 Capital Investments
3CE is responsible for investing in the preservation, maintenance, and improvement of owned assets, including buildings, equipment, and other capital infrastructure.

Projects in excess of $100,000 that have an estimated useful life of at least five years and are non-recurring are considered capital projects and should be evaluated against other uses and priorities.

All capital expenditures should be included in the Adopted Budget or taken to the Policy Board for approval and amendment to the Adopted Budget.

8.0 Debt Management
Due to its length and complexity, the Debt Management Policy is reviewed by the Policy Board separately from these policies.

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ATTACHMENT B – FINANCIAL POLICIES

These policies provide general guidance in the management of the 3CE’s fiscal affairs and are to be used by all 3CE employees to meet their obligation to operate in a financially prudent manner.

The Recommended Budget is developed in accordance with this framework.

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3.0 Roles and Functions

The CEO is the fund manager for the 3CE Enterprise Fund and any other funds that may be created.

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4.0 Services and Fund Structure

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4.2 Proprietary Fund
An enterprise fund is classified as a proprietary fund and is financed and operated like private business enterprises whose services are primarily funded through user charges.

4.3 Expenses
Enterprise fund expenses and revenues will be established at sufficient levels to properly maintain the fund’s infrastructure and provide significant capital development.

5.0 Operating Budget

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costs into the future. 3CE will acquire and maintain high-quality equipment to maximize useful life and ensure efficient operations.

The CEO has oversight and contract management over the external auditors reviewing the ACFR.

External auditors shall report to the CEO or designated officer on audit findings. The CEO will take the audit findings thereafter to the Policy Board.

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Criteria in the listing are not exhaustive or in any particular order, nor are they mutually exclusive; funding recommendations may align with more than one criterion.

5.11 Amendments to the Adopted Budget
Modifications to the Adopted Budget require the approval of a majority of Policy Board members.

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6.0 Net Position and Reserve Policies

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7.0 Capital Facilities and Improvement Policies

7.1 Capital Investments
3CE is responsible for investing in the preservation, maintenance, and improvement of owned assets, including buildings, equipment, and other capital infrastructure.

All capital expenditures should be included in the Adopted Budget or taken to the Policy Board for approval and amendment to the Adopted Budget.

8.0 Debt Management
Due to its length and complexity, the Debt Management Policy is reviewed by the Policy Board separately from these policies.

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ATTACHMENT A – FY 2025-26 FINANCIAL POLICIES (redlined)

1.0 Purpose and Background
The pPrudent and conservative responsible stewardship of public assets is a principal responsibility given to the officials and managers of 3CEobligation of 3CE officials and managers.

The development and maintenance of financial policies enable 3CE officials to protect those public assets, ensure transparency, and build public trust. Financial policies define a shared understanding of how 3CE administers its financial affairs and communicates how the agency manages its resources to provide the highest value to the communities we served.

These policies provide general guidance in the management of the 3CE’s fiscal affairs and are to be used by all 3CE employees to meet their obligation to operate in a financially prudent manner.

The Recommended Budget adheres is developed in accordance with this frameworkto these policies.

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• Ensure the legal use of financial resources through an effective system of internal controls;
• Support sound financial management by providing accurate and timely information on 3CE’s financial condition; and
• Provide a framework for the wise and prudent use of debt financing and maintain a good strong credit rating in the financial community.

2.1 The Annual Budget
The Chief Executive Officer (CEO) will recommend a balanced budget that:
• Aligns annual expenditures with the revenue requirement established through a cost-of-service methodology; • Minimizes reliance on reserves and one-time funding sources for ongoing operations; and
• Maintains competitive, market-based rates while supporting 3CE’s renewable energy goals. aligns annual expenditures with market reasonable rates based on the revenue requirement established through a cost of service methodology and minimize the use of reserves and one-time financing sources for ongoing operating expenditures; •
3CE will strive to maintain competitive rates while adhering to our renewable energy goals;
• Through the CEO, the Chief Financial Officer (CFO) will consult with 3CE Officers and seek their input in developing the Recommended Budget through cooperative discussions and financial education.; The
• CEO will keep the Policy Board apprised of the condition of the 3CE’s finances and emerging fiscal issues.; and
• Through the CEO and Officers, 3CE will work with the California Community Choice Association (CalCCA), state representatives, legislative advocates in the State Capitol, and other local government organizations to ensure our community voice is heard regarding any state legislation or regulation affecting our stakeholders.

3.0 Roles and Functions

The CEO is the fund manager for the 3CE Enterprise Fund and any other funds that may be created.

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• Developing financial forecasts;
• Monitoring revenues and expenditures for conformance with the annual budget; • Recommending effective fiscal policies to carry out the 3CE mission; • Verifying Policy Board policies are consistently applied; and • Ensuring items brought before the Policy Board are transparent, accurate, complete, fully justified, and reviewed by appropriate stakeholders.

4.0 Services and Fund Structure

4.1 Enterprise Fund
3CE operates as an enterprise fund. The enterprise fund accounts for revenues and

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expenditures for all 3CE activities. The fund’s operations are financed and operated like private business enterprises, where services provided are primarily funded through user charges (electric generation rates).

4.2 Proprietary Fund
An enterprise fund is classified as a proprietary fund and is financed and operated like private business enterprises whose services are primarily funded through user charges.

4.3 Expenses
Enterprise fund expenses and revenues will be established at sufficient levels to properly maintain the fund’s infrastructure and provide significant capital development.

5.0 Operating Budget

5.1 The 3CE Budget
The Recommended Budget is the central financial planning document that the agency’s goals, objectives, priorities, levels of service, and the associated operating revenue and expenditures.

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The CEO has oversight and contract management over the external auditors reviewing the ACFR.

External auditors shall report to the CEO or designated officer on audit findings. The CEO will take the audit findings thereafter to the Policy Board.

5.9 3CE Budget Development
Budget development is an annual process incorporating the Policy Board’s priorities and weighing competing requests for 3CE resources within expected fiscal constraints. The process begins with departments preparing “baseline” budgets proposing levels of service and staffing that can be carried out within expected resources (e.g., revenues). Departments may submit “augmentation requests” for additional resources to mitigate potential impacts, increase staffing/services, or invest in infrastructure. The CEO evaluates baseline budgets and augmentation requests within the constraints of a balanced budget and builds the annual Recommended Budget. Staff considers the following criteria in formulating recommendations for the annual budget and subsequent mid-year budget modifications:
• Mandated by current law, regulation, or Policy Board policy; • Alignment with the 3CE’s strategic initiatives and priorities; • Necessary to maintain the current level of mission-critical services/operations; • Substantiation of compelling public need (e.g., health, safety, economic vitality, quality of life) that cannot be met within existing resources;
• Likelihood of success based on prior performance, degree of planning/specificity, requested resources, and assumed timeline;
• Leverages sustainable financial support from non-3CE sources; • Appropriate placement of responsibility (federal, state, or local); • Degree of urgency; and
• Critical infrastructure investment to ensure productivity and continuity of operations.

Criteria in the listing are not exhaustive or in any particular order, nor are they mutually exclusive; funding recommendations may align with more than one criterion.

5.11 Amendments to the Adopted Budget
Modifications to the Adopted Budget require the approval of a majority of Policy Board members.

Amendments to the Adopted Budget will be made in compliance with Policy Board policies. As

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an enterprise fund, the relationship between financing uses and financing sources is the overriding principle; thus, appropriation controls are not required.

6.0 Net Position and Reserve Policies

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judgments against the 3CE in excess of reserves specifically designated for litigation, for natural disasters as determined by the CEO or Policy Board, and for one-time-only budget overruns that could not be addressed through the annual appropriations for contingencies.

Any material or sustained use of the reserve shall be reflected in the Recommended Budget, including a long-term plan to replenish the reserveThe energy rate stabilization reserve shall be utilized for large fluctuations in the COE and/or required increased power purchasing needs including regulatory compliance. This reserve may be utilized throughout the fiscal year at the direction of the CEO with subsequent reporting to the Energy Risk Management Committee and the Boards.

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7.0 Capital Facilities and Improvement Policies

7.1 Capital Investments
3CE is responsible for investing in the preservation, maintenance, and improvement of owned assets, including buildings, equipment, and other capital infrastructure.

All capital expenditures should be included in the Adopted Budget or taken to the Policy Board for approval and amendment to the Adopted Budget.

8.0 Debt Management
Due to its length and complexity, the Debt Management Policy is reviewed by the Policy Board separately from these policies.

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ATTACHMENT B – FY 2025-26 FINANCIAL POLICIES

These policies provide general guidance in the management of the 3CE’s fiscal affairs and are to be used by all 3CE employees to meet their obligation to operate in a financially prudent manner.

The Recommended Budget is developed in accordance with this framework.

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3.0 Roles and Functions

The CEO is the fund manager for the 3CE Enterprise Fund and any other funds that may be created.

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4.0 Services and Fund Structure

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4.2 Proprietary Fund
An enterprise fund is classified as a proprietary fund and is financed and operated like private business enterprises whose services are primarily funded through user charges.

4.3 Expenses
Enterprise fund expenses and revenues will be established at sufficient levels to properly maintain the fund’s infrastructure and provide significant capital development.

5.0 Operating Budget

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costs into the future. 3CE will acquire and maintain high-quality equipment to maximize useful life and ensure efficient operations.

The CEO has oversight and contract management over the external auditors reviewing the ACFR.

External auditors shall report to the CEO or designated officer on audit findings. The CEO will take the audit findings thereafter to the Policy Board.

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Criteria in the listing are not exhaustive or in any particular order, nor are they mutually exclusive; funding recommendations may align with more than one criterion.

5.11 Amendments to the Adopted Budget
Modifications to the Adopted Budget require the approval of a majority of Policy Board members.

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6.0 Net Position and Reserve Policies

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7.0 Capital Facilities and Improvement Policies

7.1 Capital Investments
3CE is responsible for investing in the preservation, maintenance, and improvement of owned assets, including buildings, equipment, and other capital infrastructure.

All capital expenditures should be included in the Adopted Budget or taken to the Policy Board for approval and amendment to the Adopted Budget.

8.0 Debt Management
Due to its length and complexity, the Debt Management Policy is reviewed by the Policy Board separately from these policies.

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Staff Report Item 3
TO: 3CE Policy Board of Directors
FROM: Robert M. Shaw, Chief Executive Officer
PREPARED BY: Marina Pantchenko, Deputy General Counsel
SUBJECT: Adopt Resolution No. PB-2025-04 delegating authority to the Executive Committee to: (1) approve Capital Improvement Projects in an amount not to exceed $5,000,000, and (2) authorize the CEO to enter agreements to effectuate the projects
DATE: June 18, 2025
RECOMMENDATION:

It is recommended that the Policy Board Adopt Resolution No 2025-PB-0X delegating authority to the Executive Committee to: (1) approve Capital Improvement Projects in an amount not to exceed $5,000,000, and (2) authorize the CEO to enter into agreements to effectuate the projects.

BACKGROUND:

In December of 2024, the Policy Board met and discussed the Ad Hoc Governance Committee’s recommendations around streamlining processes and making improvements to the Agency’s ability to efficiently conduct business. Several Policy Board Directors indicated that the Executive Committee could take on more responsibility, with specific guidelines and parameters set in place.

The Joint Exercise of Powers Agreement, Section 3.3.3 sets forth that the Policy Board shall be required, to authorize major capital expenditures, among others. The Policy Board meets four times per year, and the scope of this power necessitates scheduling special meetings which occasionally presents difficulties with a 19-member board.

DISCUSSION/ANALYSIS:
3CE’s strategic goals include transportation electrification and emissions reduction through renewable energy. In Q1 of 2025, 3CE launched its EV Charger Asset Pilot which would provide both workplace and publicly accessible EV chargers at four locations. While all these projects were approved by the Policy

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Board, it is anticipated that 3CE will continue to scale its renewable energy and electrification goals, which would present additional capital improvement opportunities, such as locally owned generation, battery projects and microgrids.

As 3CE now serves the largest geographic CCA territory, one of the Agency’s goals is to identify regional office locations, including a new headquarters in the Monterey area. Staff has recently acquired a regional office in the Santa Cruz and San Luis Obispo areas. These regional offices will require tenant improvements to existing structures, as well as potential construction of 3CE owned charging infrastructure. In addition, 3CE is developing pilot projects 3CE owned and operated publicly accessible charging infrastructure.

Accordingly, to streamline efficiency and respond to construction bids timely, which enables 3CE to avoid potential increases in construction costs, it is recommended that the Policy Board delegate approval and authorization of capital projects in an amount not to exceed $5,000,000 per project. The delegation would not extend to the purchase of real property.

Any approved capital improvement projects will be reported on at the next Policy Board meeting. Given that the Executive Committee ordinarily meets once a month, this delegation would enable the Agency to respond to its needs more quickly and efficiently.

FISCAL IMPACT:

There is no fiscal impact to this recommended action.

ATTACHMENT(S):

1. Draft Resolution No. 2025-PB-04

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DRAFT RESOLUTION NO. PB-2025-04

A RESOLUTION OF THE CENTRAL COAST COMMUNITY ENERGY POLICY BOARD OF DIRECTORS

DELEGATING AUTHORITY TO THE EXECUTIVE COMMITTEE TO AUTHORIZE CAPITAL IMPROVEMENT PROJECTS NOT TO EXCEED $5,000,000
WHEREAS, Central Coast Community Energy (3CE) is a Joint Powers Authority (JPA) established and operated pursuant to California Government Code sections 6500 et seq. to study, promote, develop, conduct, operate, and manage energy programs in the California Central Coast region of Santa Cruz, Monterey, San Benito, Santa Barbara, and San Luis Obispo counties; and WHEREAS, 3CE is a community choice aggregator (CCA), as such term is defined in section 331.1 of the Public Utilities Code of the State of California (Public Utilities Code), that is a public agency, as such term is defined in the JPA law, which has implemented a CCA program pursuant to section 366.2 of the Public Utilities Code, and possesses the power to purchase and sell electric energy and enter related contracts for such purposes; and
WHEREAS, 3CE’s JPA Agreement establishes a Policy Board of Directors to oversee guidance and approval of strategic planning and goal setting, passage of the Authority budget and customer rates, and large capital expenditures outside of power procurement; and
WHEREAS, on December 11, 2024, the Policy Board of Directors met to discuss the Ad Hoc Governance Committee’s recommendations around streamlining Agency processes, including delegating additional responsibilities to the Executive Committeee; and
WHEREAS, the 3CE Executive Committee currently consists of the Chair and Vice Chair of both the Policy and Operations Boards with one additional Operations Board member and two additional Policy Board members; and
WHEREAS, 3CE’s Executive Committee meets on a monthly basis and consists of up to seven members selected by the Policy Board Chair and serving two, three-year terms; and WHEREAS, 3CE’s Policy Board meets four times a year, making it difficult to timely and efficiently approve proposed capital improvement projects; and
WHEREAS, 3CE is in the process of piloting electrification projects, including ownership of publicly accessible EV charger stations within its service area, and is evaluating additional renewable capital project opportunities such as locally owned generation, battery storage, and microgrids; and WHEREAS, a delegation of authority to the Executive Committee to approve capital projects not to exceed $5,000,000 per project, will allow the Agency to more efficiently respond to its growing needs and meet its strategic goals.

NOW, THEREFORE, THE CENTRAL COAST COMMUNITY ENERGY POLICY BOARD OF DIRECTORS DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS:

1. The delegation of authority to the Executive Committee to approve capital improvement projects not to exceed $5,000,000 per project.

2. The delegation of authority to the CEO to approve any necessary contracts or agreements to effectuate the capital improvement projects within the $5,000,000 project limit.

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3. The Chief Executive Officer shall report on any approved capital improvement projects at the next regularly scheduled Policy Board meeting.

4. This Resolution is adopted under the authority of the 3CE JPA and State law. If any section, subsection, clause or phrase is declared invalid or otherwise void by a court of competent jurisdiction, it shall not affect any remaining provision hereof. In this regard, the Policy Board finds and declares that it would have adopted this measure notwithstanding any partial invalidity hereof.

PASSED AND ADOPTED this 18th Day of June 2025, by the following vote:

AYES:

NOES:

ABSENT:
__________________________________
Chair, Fred Keeley
__________________________________
Board Clerk, Heather Vowell

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Staff Report Item 4
TO: 3CE Policy Board of Directors
FROM: Robert M. Shaw, Chief Executive Officer
PREPARED BY: Christopher Cook, Director of Energy Programs Inaara Muhammad, Manager of Energy Programs
SUBJECT: Accept FY 2023-24 Energy Programs Portfolio Evaluation Report DATE: June 18, 2025
RECOMMENDATION:

It is recommended that the Policy Board accept the FY 2023-24 Energy Programs Portfolio Evaluation report.

BACKGROUND:

On September 14, 2023, the 3CE Policy Board of Directors approved its FY 2023-24 Operating Budget, including nearly $15 million for Energy Programs incentives. As part of 3CE’s commitment to continual improvement, 3CE has evaluated the performance of Energy Programs supported by the FY 2023-24 budget and compiled findings and recommendations in its annual Energy Programs Portfolio Evaluation report.

On February 5, 2025, staff presented the draft FY 2023-24 Energy Programs Portfolio Evaluation report to the 3CE Community Advisory Council and received feedback for the final report.

On May 14, 2025, staff presented the draft FY 2023-24 Energy Programs Portfolio Evaluation report to the Operations Board to provide information on data collected and recommendations that are driving 3CE’s programmatic initiatives.

DISCUSSION/ANALYSIS:
3CE’s annual Energy Programs evaluation supports the agency in achieving its goals and helps to identify additional opportunities to promote affordable access to electrification and reduction of greenhouse gas emissions, for the benefit of 3CE customers.

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The FY 2023-24 Energy Programs Portfolio Evaluation assessed all programs through key performance indicators across four criteria – Program Participation, Program Performance, Program Impact, and Internal Resources. The evaluation framework aligned with 3CE’s broader efforts to implement energy programs that enable an accessible renewable energy transition for all 3CE customers and communities.

Criteria Key Performance Indicators
Program Participation
Where are 3CE’s
incentives being
distributed?
 Average $ funded per application
 % of funding distributed by county
 % of funding distributed by eligible customer type
Program Performance
Is the program being
utilized as predicted by FY
plan?
 $ incentives distributed
 % allocated budget utilized
 Achievement of FY 2023-24 program goals
Program Impact
Is the program making a
positive contribution to
the 3CE community?
 $ in all-electric purchases / support enabled
 % of purchase cost funded
 Greenhouse gas emissions reduced
 % of funding distributed to underserved communities
Internal Resources
Are 3CE resources being
used effectively?
 Conversion rate from vendors providing technical assistance  Average rebate cycle length including customer payout time  Customer Acquisition Costs (for programs with direct marketing) In FY 2023-24, 3CE offered 11 Energy Programs to residential, commercial, agricultural, and member agency customers. The incentives offered through these programs supported 3CE customers in transitioning their homes, workplaces, and transportation from fossil-fuel power to clean-energy solutions.

Fiscal Year
2023-24
Energy
Programs
Transportation Electrification
Electrify Your Ride
E-Bus Program
Plan Your Fleet
Charge Your Fleet
Electrify Your Fleet
Transportation Grants
Building Electrification
Electrify Your Home
New Construction Electrification

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Reach Codes Program
Agricultural Electrification Ag Electrification Program Load Management / Demand Response Residential Battery Rebate Program Over FY 2023-24, 3CE distributed $11 million in incentives across these 11 programs and support services, a $1.8M (16%) increase from FY 2022-23. Approximately $3.9 million, or 36% of the incentive funds distributed, were to projects in underserved communities – awarded to income-qualified customers, Title 1 schools, and small to medium-sized agricultural businesses. The electrification projects incentivized by 3CE’s Energy Programs resulted in a reduction of 3,758 metric tons of CO2e in FY 2023-24, equivalent to taking 968 gas-powered passenger vehicles off the road and avoiding nearly

10.5 million gas-powered miles driven, based on the average mileage for a passenger vehicle in California.

The attached report includes program descriptions, fiscal year goals, quantitative reporting on metrics, and key takeaways for each of 3CE’s 11 programs. The evaluation also provides portfolio-wide insights into evaluation results, including successes and opportunities for improvement. These findings and recommendations will inform future and current energy programs’ design, as well as shape strategic initiatives to enhance 3CE’s Energy Programs portfolio, such as pilot projects and planned new program offerings.

FISCAL IMPACT:

There is no fiscal impact associated with this report and update.

CONCLUSION:
3CE’s Energy Programs support local communities and 3CE customers by providing funding and services to accelerate regional electrification, reduce greenhouse gas emissions, and benefit local economies.

The comprehensive evaluation of 3CE’s FY 2023-24 Energy Programs Portfolio supports 3CE’s mission by assessing program effectiveness in providing affordable access to electrification for all 3CE customers.

The evaluation report also informs future programs’ design to further the agency's commitment to greenhouse gas reductions.

ATTACHMENT(S):

1. FY 2023-24 Energy Programs Portfolio Evaluation Report

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 1

ENERGY PROGRAMS

PORTFOLIO EVALUATION

FISCAL YEAR
2023-2024

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2 CENTRAL COAST COMMUNITY ENERGY

TABLE OF CONTENTS
Cover Page .................................................................................................................................................... 1 Table of Contents .......................................................................................................................................... 2 Executive Summary ...................................................................................................................................... 3 Introduction ................................................................................................................................................... 4 Eval Approach & Methodology ................................................................................................................... 5 Energy Programs Overview ......................................................................................................................... 7 Transportation Electrification ....................................................................................................................... 9 Electrify Your Ride ................................................................................................................................. 10 E-Bus Program ........................................................................................................................................ 11 Plan, Charge, and Electrify Your Fleet .............................................................................................. 12 Electrification Grants ............................................................................................................................ 13 Building Electrification ............................................................................................................................... 14 Electrify Your Home .............................................................................................................................. 15 New Construction Electrification ....................................................................................................... 16 Reach Codes ........................................................................................................................................... 17 Agricultural Electrification ......................................................................................................................... 18 Ag Electrification Program .................................................................................................................. 19 Load Management / Demand Response ................................................................................................. 20 Residential Battery Rebate Program ................................................................................................. 21 Findings & Recommendations .................................................................................................................. 22 Transportation Electrification ................................................................................................................. 23 Building Electrification ............................................................................................................................ 24 Agricultural Electrification....................................................................................................................... 25 Load Management / Demand Response ............................................................................................. 26 Looking Ahead & Conclusion .................................................................................................................... 27 Appendix A: Greenhouse Gas Emissions Sources ................................................................................. 28

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 3

EXECUTIVE SUMMARY
Central Coast Community Energy (3CE) serves the central coast by providing reliable, affordable, clean electricity and electrification programs to reduce greenhouse gas emissions and strengthen our local economy. As part of 3CE’s commitment to actively supporting regional climate action across 3CEs service areas in Monterey, San Benito, San Luis Obispo, Santa Cruz, and Santa Barbara counties, 3CE’s Energy Programs provide customers with tools to accelerate regional electrification through rebates, technical assistance, and optimization of energy use. This comprehensive evaluation of the agency’s fiscal year (FY) 2023-24 Energy Programs portfolio supports 3CE’s mission by assessing program effectiveness, informing future programmatic design, and delivering on the agency’s commitment to transparency and continual improvement.
3CE’s Energy Programs portfolio, through its multifaceted electrification efforts, promotes affordable electrification, inclusive opportunities, and greenhouse gas (GHG) reductions. In turn, 3CE’s evaluation metrics are structured around four key categories – program participation, program performance, program impact, and internal resources.

Standardized Key Performance Indicators (KPIs) were developed within each category to uniformly analyze each program’s accessibility, opportunities for improvements, and barriers to participation.

At its September 2023 meeting, the 3CE Policy Board of Directors approved its FY 2023-24 Operating Budget, including nearly $15 million for energy programs incentives. Of the $15 million budgeted for incentives, $11 million, or 73%, was distributed to customers. This is a $1.8 million or 12% increase from the prior fiscal year. Approximately $3.9 million, or 36% of the incentive funds distributed, were for projects in underserved communities, awarded to income-qualified customers, Title 1 schools, and small to medium-sized agricultural businesses.

The electrification projects incentivized by 3CE’s Energy Programs resulted in a reduction of 3,758 metric tons of CO2e in FY 2023-24, equivalent to taking 968 gas-powered passenger vehicles off the road and avoiding nearly 10.5 million gas-powered miles driven, based on the average mileage for a passenger vehicle in California.

By helping customers take personal action to combat climate change through electrification, 3CE’s energy programs have contributed to reducing greenhouse gas emissions and other harmful pollutants in the region, helping to improve air quality.
3CE recognizes the need to continually enhance and refine its programs, and to expand their impact. This report aims to identify areas for improvement, and specifically, to drive better outcomes related to increased program access.

The analysis of data gathered from 3CE’s FY 2023-24 programs is helping to shape the agency’s proposals for future program offerings to better meet customer needs and explore innovative technologies in the renewable energy sector. In this report, design enhancements are recommended for each of 3CE’s 11 programs to increase impact and participation, with an emphasis on income qualified customers. Additionally, pilots are being recommended to test new technologies as a precursor to implementing new programs. These pilots are focused on to demand response and load management, where technologies like battery storage and real time pricing have the potential to empower customers by lowering their costs, and increasing their use of renewable energy. 3CE’s Energy Programs continue to support community resilience in a dynamic energy landscape, while striving toward 100% clean, renewable, and affordable energy.
1https://www.epa.gov/energy/greenhouse-gas-equivalencies-calculator

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4 CENTRAL COAST COMMUNITY ENERGY

INTRODUCTION
Central Coast Community Energy (3CE) is a Joint Powers Authority (JPA) comprised of 35 local government agencies across jurisdictions throughout California’s Central Coast. These 35 agencies joined 3CE with a shared goal of gaining more control over their electricity needs to reduce greenhouse gas emissions, support the growth of clean and renewable energy, and access additional economic and environmental benefits. Currently, 3CE serves over 1.2 million customers across Monterey, San Benito, San Luis Obispo, Santa Cruz, and Santa Barbara counties.

In addition to procuring clean and renewable power, implementing sound financial policies, and engaging the community, managing 3CE’s Energy Programs Portfolio is a foundational component of meeting the agency’s core JPA goals. 3CE’s FY 2023-24 Energy Programs were designed to bring meaningful decarbonization and climate action throughout 3CE’s service area via transportation, building, and agricultural electrification along with load shifting / demand response initiatives.

This year’s evaluation focuses on various criteria to assess program design and access across 3CE’s service area.

The recommendations made in this report include immediate and long-term improvements to program design, implementation, and outreach. Through annual evaluation, 3CE’s programs continue to empower customers in the Central Coast’s collective renewable energy transition.

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 5

EVAL APPROACH & METHODOLOGY
3CE’s FY 2023-24 Energy Programs Portfolio Evaluation assessed all programs according to four criteria – Program Participation, Program Performance, Program Impact, and Internal Resources. Evaluation criteria incorporated metrics from state energy reporting standards to accurately demonstrate program objectives across customers’ income levels and geographic areas. The evaluation framework aligns with 3CE’s broader efforts to implement energy programs that enable an accessible renewable energy transition for all 3CE customers and communities. Individual program evaluations include a program description, program goals, program key performance indicators, staff observations, and key takeaways.

Criteria Purpose KPIs
Program Participation
Where are 3CE’s
incentives being
distributed?
• Avg $ funded per application
• % of funding distributed by county
• % of funding distributed by eligible customer type
Program Performance
Is the program being
utilized as predicted by
FY plan?
• $ incentives distributed
• % allocated budget utilized
• Achievement of FY 2023-24 program goals
Program Impact
Is the program making
a positive contribution
to the 3CE community?
• $ in all-electric purchases / support enabled
• % of purchase cost funded
• Greenhouse gas emissions reduced
• % of funding distributed to underserved communities
Internal Resources Are 3CE resources
being used effectively?
• Conversion rate from vendors providing technical assistance • Average rebate cycle length including customer payout time • Customer Acquisition Costs (for programs with direct marketing) EQUITY
Through our Energy Programs, 3CE continues to provide support and assistance to underserved communities to ensure equal access to energy programs for all customers. 3CE’s Underserved Communities Outreach and Engagement Plan defined communities as underserved if they face limited access to public investments, energy-related resources, and information. The report considered factors such as geographic location, cultural differences, socioeconomic status, health risks, the digital divide, and exposure to environmental hazards. As part of 3CE’s assessment of its programs’ impacts, 3CE tracked program utilization by underserved communities for all programs, excluding those designed for local government agency participation. A list of programs with equity design criteria are listed below:

Program Purpose
Electrify Your Ride Tier 1 — household income within 400-201% (Tier 1) Federal Poverty Level Tier 2 — 200% and below federal poverty level and/or CARE/FERA enrolled E-Bus Title 1 School or CCI Low-income community
Electrify Your Home CARE/FERA enrolled
New Construction Electrification Affordable housing projects by authority granting jurisdiction Ag Electrification Small business defined in Government Code Section 14837(d)(1) Res. Battery Rebate CARE/FERA enrolled, or Medical Baseline qualified

Page 59 of 157 ends

6 CENTRAL COAST COMMUNITY ENERGY

GHG ACCOUNTING METHODOLOGY
For this evaluation, GHG emissions avoided were estimated based on emissions from conventional fuel-based systems compared with the electric-based alternatives and a set of calculations and conversion factors found in Appendix A.

In accordance with best practices, all GHG emissions estimates are displayed using metric tons of carbon dioxide equivalent (CO2e) as the unit of measure.

GHG emission reductions were conservatively estimated for the following projects:

COMMUNICATIONS & OUTREACH
Focused outreach, marketing, and communications are critical to driving awareness and participation in Energy Programs. 3CE’s strategies to build agency awareness and promote Energy Programs includes:
• Community Engagement: 3CE is an active member of 65 local and diverse organizations throughout its service territory and in FY 2023-24 participated in over 114 community events and 70 meetings with City and County staff • Customer Service & Education: 11,500 calls and 3,500 emails, 15 webinars and workshops focused on Energy Programs, rates, billing, and electrification topics, 28 Member Agency presentations, 16 Farmworker outreach events, 2500 Spanish speaking customers served
• Marketing & Communications: $1.6 million dedicated to agency, $210k dedicated to Energy Programs, 332 posts on social media, 37,000 website views, 16% post engagement GHG emissions were not estimated for the following programs:
• Plan Your Fleet
• Charge Your Fleet
• New Construction Electrification
• Reach Codes
• Stationary sources, Agricultural Electrification
• EV charging equipment, Electrify Your Ride
Program Equipment Measured Type of Emission
Electrify Your Ride Passenger Vehicles On Road Gas
Electrify Your Fleet Passenger Vehicles On Road Gas
E-Bus Type A, C School Bus, Transit Bus On Road Diesel
Electrify Your Home Heat Pump Water Heaters BTU Natural Gas Ag Electrification UTVs, Compact & Standard Tractors Off Road Diesel, Mobile Source Res. Battery Rebate KWh daily load shifted N/A

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 7

ENERGY PROGRAMS OVERVIEW
FY 2023-24 ENERGY PROGRAMS PORTFOLIO
3CE’s Energy Programs Portfolio provides customers incentives and technical assistance to encourage fuel-switching and the adoption of electric technologies in the transportation sector, building sector, and agricultural sector, along with supporting demand response initiatives to optimize energy use.

FY 2023-24 was 3CE’s fourth full year of administering and implementing energy programs. 3CE offered 11 Energy Programs as indicated below. The incentives available through these programs supported 3CE customers in transitioning their homes, workplaces, and transportation from fossil-fuel powered to clean-energy solutions.

Transportation Electrification:

Incentives and assistance for light,
medium, and heavy-duty EVs and
charging infrastructure
Agricultural Electrification:
supporting the agricultural
industry in the transition from
fossil fuels to electricity for
agricultural equipment including
irrigation pumping, tractors,
forklifts, etc.

Electrify Your Ride
Ag Electrification Electrify Your Ride Program
E-Bus Program
Transportation Grants
Plan, Charge, and Electrify
Your Fleet
Load Shifting /
Demand Response:
supporting grid reliability
through customer load
modification strategies.

Residential Battery Electrify Your Ride
Rebate Program
Building Electrification:

Incentives and assistance to
switch various end uses in new
and existing residential buildings
including domestic hot water, space
conditioning, cooking, etc.

Electrify Your Home
Reach Codes Program
New Construction
Electrification
FY 2023-24
Energy Programs

Page 61 of 157 ends

8 CENTRAL COAST COMMUNITY ENERGY
FY 2023-24 ENERGY PROGRAMS HIGHLIGHTS
In FY 2023-24. 3CE distributed over $10.9 million in incentives across 11 programs and support services, a $1.8M increase from FY 2022-23.

Program Name
Unique
Applications
Approved*
Incentive
Budget
Budget
Spent ($)
Budget
Spent (%)
GHG impact
(Avoided MT
Co2e
Electrify Your Ride 1,436 $3,950,000 $4,055,128 103% 3,000 E-Bus 10 $2,000,000 $1,866,761 93% 319
Plan Your Fleet 9 $250,000 $221,650 89% N/A
Charge Your Fleet 9 $1,240,000 $543,544 44% N/A
Electrify Your Fleet 17 $2,100,000 $907,000 43% 189
Electrify Your Home 297 $1,110,000 $1,300,974 117% 108
New Construction
Electrification 23 $1,100,000 $1,108,250 101% N/A
Reach Codes 4 $100,000 $133,288 133% N/A
Agricultural
Electrification 18 $1,830,000 $442,356 24% 142
Residential Battery
Rebate ** 11 $0 $57,800 N/A 90 kWh load shifted daily
Grants 8 $1,155,459 $225,496 20% N/A
TOTAL 1,842 $14,835,459 $10,862,247 73% 3,758 MT Co2e
Table 1: Energy Programs FY 2023-24 Portfolio Metrics
*Some programs allow customers to receive multiple rebates within one application. Total rebates distributed for each program can be found on the program’s metrics page.
**The Residential Battery Rebate Program was not included in the original FY 2023-24 budget.

Program # Equity-Qualified
Projects
$ Equity-Qualified
Projects
% of Budget
Distributed to Equity
Projects*
Electrify Your Ride 617 $1,393,259 35%
E-Bus 6 $1,354,422 72%
Electrify Your Home 17 $460,085 37%
New Construction
Electrification 19 $513,750 46%
Ag Electrification 9 $207,213 50%
Res. Battery Rebate 1 $7,000 12%
TOTAL 6,698 $3,935,729 36%
Table 2: Energy Programs FY 2023-24 Equity Metrics
*Excludes 3CE funding towards technical assistance

Page 62 of 157 ends

2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 9

TRANSPORTATION ELECTRIFICATION
Over 3,500 MT CO2e avoided in FY 2023-24
Equivalent to 393,834 gallons of gasoline consumption avoided Program Features FY 2023-24 Impact
Technical assistance, including EV charger feasibility studies & designs, for commercial customers looking to electrify their operations Engaged with 23 commercial
customers
Technical assistance for comprehensive fleet electrification planning and charging infrastructure projects, including design and engineering consulting Engaged with 9 Member Agencies Program Design Improvement
E-Bus Increased funding cap to $400,000 per applicant for the purchase of 5+ buses Plan Your Fleet Expanded program budget and scope to assist more agencies Program Design Improvements Implemented in FY 2023-24
Program Design Improvement
E-Bus Increased funding cap to $400,000 per applicant for the purchase of 5+ buses Plan Your Fleet Expanded program budget and scope to assist more agencies Program Features FY 2023-24 Impact
Technical assistance, including EV charger feasibility studies & designs, for commercial customers looking to electrify their operations
Engaged with 23 commercial customers
Technical assistance for comprehensive fleet electrification planning and charging infrastructure projects, including design and engineering consulting Engaged with 9 Member Agencies
Over 3,500 MT CO2e avoided in FY 2023-24
Equivalent to 393,834 gallons of gasoline consumption avoided Transportation Electrification
Program Design Improvements Implemented in FY 2023-24
9 Equipment Incentivized $ Incentives Distributed
Transportation Electrification
Incentives and assistance for light, medium, and heavy-duty EVs and charging infrastructure
Electrify Your Ride
Residential & commercial
incentives for electric vehicles,
chargers, and infrastructure
upgrades
FY 2023-24 Budget: $4 million
E-Bus Program
Incentives for all-electric buses
in public schools, school
districts, farmworker transit
organizations, and public
transit agencies
FY 2023-24 Budget: $2 million
Plan, Charge, and Electrify
your Fleet
Incentives and technical
assistance for zero emission
fleet planning, EV purchases,
and EV chargers purchase and
installation
FY 2023-24 Budget: $3.4 million
Transportation Grants
Grants for planning,
implementation, and
innovation projects in
electrification & energy
FY 2023-24 Budget: $1.2 million

Page 63 of 157 ends

10 CENTRAL COAST COMMUNITY ENERGY

ELECTRIFY YOUR RIDE
Residential & commercial incentives for electric vehicles, chargers, and infrastructure upgrades “A couple of days ago, I received and deposited the $4,000 check I received from you as a rebate for the lease of my 2025 Nissan Leaf all electric vehicle. I honestly want to let you know, that without that rebate, our family would not have been able to cover the cost of the new lease. On behalf of our household, and all other low income families, who want to do their part to ensure a sustainable energy economy, we are deeply grateful.” - EYR Participant
G
O
A
L
S
Incentivize at least 600 EVs and 450 EV
Chargers
Distribute at least 40% of incentives to
income qualified customers
Key
Takeaways
Success: 21% increase in income qualified
customer participation this fiscal year
Opportunity: South Monterey & San Benito
Counties experienced low participation
relative to their population size.
>1% 0.1-0.9% <0.1%
County of
Monterey
County of San
Luis Obispo
County of Santa
Barbara
County of
Santa Cruz
County of San
Benito
Electrify Your Ride
Residential & commerical incentives for electric vehicles, chargers, and infrastructure upgrades

PARTICIPATION PERFORMANCE
IMPACT
2,408 Total equipment & assistance approved across
1436 unique applicants in 3CE service area
$4M in incentives distributed
Over $52M in all-electric purchases enabled
Over 3,000 MT CO2e avoided in FY 2023-24
Over 35% incentives distributed to income
qualified applicants

INTERNAL
Customer acquisition
cost
Budget
variance
Eligible applicants
funded
Average days to
fund project
20 100%
$70
<1%
Figure 1: Unique Figure 2: $ Incentivized by County
applications by County
Figure 1: Heat map of rebate dollars per
zip code active accounts
Figure 2: % participation of
total active accounts per zip
Figure 5: Reasons for 211 denied applications
Green signifies large clusters of high
rebate $/zip
“A couple of days ago, I received and deposited the $4,000 check I received from you as a rebate for the lease of my 2025 Nissan Leaf all electric vehicle. I honestly want to let you know, that without that rebate, our family would not have been able to cover the cost of the new lease. On behalf of our household, and all other low income families, who want to do their part to ensure a sustainable energy economy, we are deeply grateful.” -EYR Participant
Figure 4: % Distribution of income-qualified rebates
by county
Figure 3: All-electric purchases enabled by equipment type 10 PARTICIPATION

INTERNAL

PERFORMANCE
IMPACT
G
O
A
L
S
Incentivize at least 600 EVs and 450
EV Chargers
Distribute at least 40% of incentives to
income qualified customers
KEY

TAKEAWAYS
Success: 21% increase in income
qualified customer participation this
fiscal year
Opportunity: South Monterey &
San Benito Counties experienced
low participation relative to their
population size

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 11

E-BUS PROGRAM
Incentives for all-electric buses in public schools, school districts, farmworker transit organizations, and public transit agencies “These dollars are well spent and significantly help us to reduce both GHG and other vehicle exhaust emissions while at the same time increasing our overall operating efficiency and driver comfort. Truly, this has been a win-win engagement.” - Santa Cruz City Schools
G
O
A
L
S
Incentivize at least 10 E-buses
Incentivize at least 5 E-buses serving a Title
1 school, low-income, or disadvantaged
community.

Key
Takeaways
Success: A decision to fund multiple buses, made
in July 2024, increased program participation by
over 40% in Q4 of 2024
Opportunity: Although San Benito County has
more than five Title 1 schools, participation in this
Program remains low.

County of
Monterey
County of Santa
Barbara
County of Santa
Cruz
Monterey
Santa Cruz
Santa Barbara
E-Bus Program
Incentives for all-electric buses in public schools, school districts, farmworker transit organizations, and public transit agencies

PARTICIPATION PERFORMANCE
IMPACT
Figure 6: Applications by
County
Figure 7: $ Incentivized by County
Over $11.60M in all-electric purchases enabled for 18
buses & EV charging equipment
Equivalent to taking 7 diesel transit/shuttle and/or
school buses off the road in one year
of total incentives distributed to
disadvantaged communities
10 applications approved across 3CE service area $1.9M in incentives distributed Figure 9: Rebate funding profile by applicant type

INTERNAL
FY 23/24 Applicant to
rebate ratio
Average days to
fund project*
Budget
variance
Eligible applicants
funded
3 100%
50%
7%
*Following final document receival
Figure 8: % funding to a Title 1 School or
disadvantaged community, by County
of school bus incentives
distributed to Title 1 Schools
72%
79% Approximately 319 mT Co2 avoided
Average of 2.6 buses funded per unique appliant
46% average of total purchase cost covered
“The rebates we received through this program will allow us to transport kids to where they need to be, even from rural areas. We couldn’t have done this without the help of 3CE funds.” -Santa Cruz City Schools County of Santa Cruz
17 buses & 1 EV charging equipment funded
11 PARTICIPATION

INTERNAL

PERFORMANCE
IMPACT
G
O
A
L
S
Incentivize at least 10 E-buses
Incentivize at least 5 E-buses
serving a Title 1 school, low-income, or
disadvantaged community
KEY

TAKEAWAYS
Success: A decision to fund multiple
buses, made in July 2024, increased
program participation by over 40% in
Q4 of 2024
Opportunity: Although San Benito
County has more than five Title 1
schools, participation in this Program
remains low

Page 65 of 157 ends

12 CENTRAL COAST COMMUNITY ENERGY

PLAN CHARGE AND ELECTRIFY YOUR FLEET
“These dollars are well spent and significantly help us to reduce both GHG and other vehicle exhaust emissions while at the same time increasing our overall operating efficiency and driver comfort. Truly, this has been a win-win engagement.” - Skip Grey, Assistant Director- General Services Department, County of Santa Barbara G
O
A
L
S
Plan Deliver assistance to 5 member agencies
Charge
Incentivize 100 L2 chargers
Incentivize 5 DCFCs
Fund at least one publicly available project
Electrify
Incentivize 50 EVs
Fund at least one project within a low
income or disadvantaged community
PLAN:

Technical assistance for
zero emission fleet planning
ELECTRIFY:

Incentives for purchase of light,
medium, and heavy duty vehicles
Key
Takeaways
Success: Decision to divert unused CYF and
EYF funding to PYF resulted in a 3x increase in
participation of PYF
Opportunity: Popularity of PYF relative to CYF
and EYF demonstrates need to meet customers
where they are and provide assistance at each
stage of the process.
“These dollars are well spent and significantly help us to reduce both GHG and other vehicle exhaust emissions while at the same time increasing our overall operating efficiency and driver comfort. Truly, this has been a win-win engagement.” -Skip Grey, Assistant Director- General Services Department, County of Santa Barbara 3 Program
Engagements
2 Program
Engagements
1 Program
Engagement
Santa Cruz County
Monterey County
Santa Barbara County
Carmel
Greenfield
Marina
Monterey
Soledad
Capitola
Santa Cruz
Watsonville
San Luis
Obispo
Carpinteria
Goleta
Santa Maria
Figure 10: City names reflected on the map
colored by level of engagement
Application
submitted
Final document
receival
Incentive approved
for payment
145 DAYS 5 DAYS
CHARGE:

Incentives for purchase and
installation of EV chargers

PARTICIPATION
15 Member Agencies engaged across 3CE service area

PERFORMANCE
$221,650 in PYF program funds distributed
$504,544 in CYF incentives distributed
$798,000 in EYF incentives distributed
IMPACT
Over $5.6M in all-electric purchases enabled
$4.5M for 44 EVs $686k for 54 L2s $241k for 6 DCFCs
Plan, Charge, and
Electrify Your Fleet
3 Counties, 12 Cities

INTERNAL
PYF participants that also participated
in EYF and/or CYF this FY
Member Agencies hit $150k program
dollar cap
3 56%
Figure 11: Distribution of resources by equipment type
12 PLAN:

Technical assistance for zero
emission fleet planning
CHARGE:

Incentives for purchase and
installation of EV chargers
ELECTRIFY:

Incentives for purchase of light,
medium, and heavy duty vehicles

PARTICIPATION

INTERNAL

PERFORMANCE
IMPACT
Figure 11: Distribution of resources by equipment type
G
O
A
L
S
Plan Deliver assistance to 5 member agencies
Charge
Incentivize 100 L2 chargers
Incentivize 5 DCFCs
Fund at least one publicly available project
Electrify
Incentivize 50 EVs
Fund at least one project within a low income
or disadvantaged community
KEY

TAKEAWAYS
Success: Decision to divert unused CYF
and EYF funding to PYF resulted in a 3x
increase in participation of PYF
Opportunity: Popularity of PYF relative to
CYF and EYF demonstrates need to meet
customers where they are and provide
assistance at each stage of the process

Page 66 of 157 ends

2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 13

ELECTRIFICATION GRANTS
“Through the 3CE Planning Implementation Innovation Grant program, we have been able to explore more nimble and creative solutions to drive down carbon emissions and adapt to climate change. Our grant is funding an innovative combined approach to building and transport electrification synergies that can only be achieved when designed together. The program has been a key resource that unlike other, more cookie-cutter funding programs, allows for projects to change with real-world conditions.”
- Toto Vu-Duc, Environmental Projects Manager, City of Watsonville Grant Recipient /
Project Partner Grant Purpose
Grant
Approved
Amount ($)
Approval
Date Grant Status
Center for
Sustainable Energy
California Vehicle Infrastructure
Project - Central Coast Incentive $1,000,000 5/10/2019 Active (expected completion 9/30/25) Center for
Sustainable Energy
California Vehicle Infrastructure
Project - South Central Coast
Incentive
$1,750,000 6/30/2021 Active (expected
completion 9/30/25)
City of Goleta Digital Equity Project $75,000 10/9/2023 Completed (9/30/2024)
City of Santa Cruz
Public Works Dept
Municipal Transportation
Electrification Plan $75,000 9/28/2022 Completed (1/16/2024) City of Watsonville
Development of an EV
masterplan with building
electrification analysis
$150,000 9/28/2022 Active
County of Monterey
Development of a holistic,
County-wide decarbonization
framework to electrify Monterey
County Facilities
$150,000 10/6/2022 Active
County of Santa
Cruz Admin Office
Grant funding for regional
electrification projects $100,000 10/3/2022 Completed (5/1/2024) Green Light Labs Inc Electrifyze platform $100,000 9/29/2022 Completed (5/30/2024)
Table 3: Active and Completed Grants in FY 2023-24
IMPACT
California Vehicle Infrastructure Project Digital Equity Project 4 Projects 106 Projects
13 Level 2 Chargers 8 Level 2 Chargers
2 DC Fast Chargers 63 DC Fast Chargers
KEY

TAKEAWAYS
Success: 3CE invested over $3.4 million in innovative projects across 3CE’s service area including electrification education and digital equity initiatives
Opportunity: Long lag time between grant approval and
completion - Active grants have been pending for over 3 years, and it takes an average of 1.5 years to complete a grant

INTERNAL
Grant Approval Grant Completion
Completed Grants
504 Days (17 months)
Active Grants
1,154 Days (38 months)
Grant Approval FY-end

PERFORMANCE
$225,496 in funding
distributed to active and
completed grants in
FY 2023-24

Page 67 of 157 ends

14 CENTRAL COAST COMMUNITY ENERGY

BUILDING ELECTRIFICATION
Over 122 MT CO2e avoided in FY 2023-24*
Equivalent to powering 16 homes for a year
*avoided emissions from heat pump water heater installations only Program Features FY 2023-24 Impact
Process EYH applications, distribute rebate checks, maintain the enrolled contractor list Facilitated nearly 300 EYH applications Develops code language and facilitates Reach Code adoption for interested Member Agencies 4 Reach Codes adopted
Program Design Improvement
Electrify Your Home Ensured consistent operation of the EYH program by allowing 3CE staff to quickly and easily compensate for TECH budget shortages when desired New Construction Electrification Expanded program to include rebates for all-electric, market-rate housing Program Design Improvements Implemented in FY 2023-24
New Construction Elect. Electrify Your Home
Equipment Incentivized $ Incentives Distributed
Building Electrification
Incentives and assistance to switch various end uses in new and existing residential buildings including domestic hot water, space conditioning, cooking, etc.

Electrify Your Home
Incentives for replacement of gas
appliances with electric heat pump
appliances
FY 2023-24 Budget: $1.1M
New Construction Elect.

Incentives for development of all-electric
residential, multi-family, and agricultural
housing
FY 2023-24 Budget: $1.1M
Reach Codes
Technical assistance for Member Agencies
to adopt and codify reach codes that
promote building electrification and EV
infrastructure
FY 2023-24 Budget: $100,000

Page 68 of 157 ends

2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 15
G
O
A
L
S
Fund 250 rebates
Support 10 projects at income-qualified sites
Support at least 3 multifamily projects
Key
Takeaways
Success: 26% increase is
projects compared to FY 2022-23
Opportunity: 6% participation by
disadvantaged community
members and contractors
Electrify Your Home
Incentives for replacement of gas appliances with electric heat pump appliances

PARTICIPATION PERFORMANCE
IMPACT

INTERNAL
297 applications approved across 3CE service area
Figure 12: # Applications by Co. Figure 13: $ Incentives by Co. $1,218,885 in incentives distributed
Application Rebate
71 DAYS
Over $4,769,122 in all-electric purchases enabled...

Approx customer
acquisition cost:
54% total applications were eligible and received a rebate Monterey
County
San Luis
Obispo County
Santa Barbara
County
Santa Cruz
County
$233
Figure 15: Total funding by zip code, EYH 2023-24
Total rebate amount (USD)
6% of total applications were equity applications
15 Figure 14: Heat Pump Purchases Incentivized
Figure 16: Income Qualified Applications by County
Figure 17: Unsuccessful Applications

ELECTRIFY YOUR HOME
Incentives for replacement of gas appliances with electric heat pump appliances “The EYH program has been a wonderful program for me and my company. I am entering year 3 of the program and have been able to expand my roles and usages every year...This has all been provided for me due to the willingness and efforts put forth by 3CE and the EYH program.” - David Brown, DB Heating and Cooling
G
O
A
L
S
Fund 250 rebates
Support 10 projects at income-qualified sites
Support at least 3 multifamily projects
Key
Takeaways
Success: 26% increase is
projects compared to FY 2022-23
Opportunity: 6% participation by
disadvantaged community
members and contractors
Electrify Your Home
Incentives for replacement of gas appliances with electric heat pump appliances

PARTICIPATION PERFORMANCE
IMPACT

PARTICIPATION

INTERNAL

PERFORMANCE
IMPACT
G
O
A
L
S
Fund 250 rebates
Support 10 projects at income-qualified sites
Support at least 3 multifamily projects
KEY

TAKEAWAYS
Success: 26% increase is projects
compared to FY 2022-23
Opportunity: 6% participation by
disadvantaged community members
and contractors

Page 69 of 157 ends

16 CENTRAL COAST COMMUNITY ENERGY

NEW CONSTRUCTION ELECTRIFICATION
Incentives for replacement of gas appliances with electric heat pump appliances “It was simple (building all electric). It was sustainable and offering the best product to the family. They can live a safe and clean life with no contaminants.

This whole project has been built with efficiencies and the highest standard and we continue to build to that standard.” - Nick Rasmussen, CEO Habitat for Humanity SLO
G
O
A
L
S
Support 200 new, all-electric housing units
Support 1 farmworker housing project
Incentivize projects in all five counties
“It was simple (building all electric). It was sustainable and offering the best product to the family. They can live a safe and clean life with no contaminants. This whole project has been built with efficiencies and the highest standard and we continue to build to that standard.” - Nick Rasmussen, CEO Habitat for Humanity SLO Key
Takeaways
Success: The program incentivized
234 affordable units, exceeding the
program goal by 34 units
Opportunity: Low applications for
designated Farmworker Housing
San Luis Obispo
County
Santa Cruz
County
Monterey
County
Santa Barbara
County
New Construction Electrification
Incentives for development of all-electric residential, multi-family, and agricultural housing

PARTICIPATION PERFORMANCE
IMPACT
23 applications approved across 3CE service area $1,103,250 in incentives distributed

INTERNAL
459 all-electric units incentivized
including 234 affordable units incentivized
10 Applications from
previous fiscal years
13 Applications from
FY 23-24
33% Application to rebate rate for
FY 23-24 applicants
69%
Cancelled applications due to
delayed construction;
Applicants invited to reapply
post project completion.

Figure 21: Total funding by zip code, NCEP FY 2023-24
Total rebate amount (USD)
16 Figure 18: # Applications by Co. Figure 19: $ Incentivized by Co.

Figure 20: Units Incentivized by County
San Benito County participated with 24 units in FY 21/22 Figure 22: $ Incentivized by Type

PARTICIPATION

INTERNAL
IMPACT

PERFORMANCE
G
O
A
L
S
Support 200 new, all-electric housing units
Support 1 farmworker housing project
Incentivize projects in all five counties
KEY

TAKEAWAYS
Success: The program incentivized 234
affordable units, exceeding the program
goal by 34 units
Opportunity: Low applications for
designated Farmworker Housing

Page 70 of 157 ends

2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 17

REACH CODES
Technical assistance for Member Agencies to adopt and codify reach codes that promote building electrification and EV infrastructure
GOAL
Provide support for 6
Member Agencies to
adopt Reach Codes
Key
Takeaways
Success: Inclusion of technical
assistance for code updates facilitated
re-adoption of 2 reach codes.

Opportunity: 4 reach codes adopted, 2
updated.

INTERNAL *
Interest Code passes
second reading &
is implemented
Code retired
or readopted
185 DAYS 298 DAYS
Technical Assistance
$133k towards implementing codes and updating
previously adopted
140 Permits impacted per year
100* Anticipated charger projects
by 2030
*City of Goleta EVI code
Reach Codes
Technical assistance for Member Agencies to adopt and codify reach codes that promote building electrification and EV infrastructure

PARTICIPATION PERFORMANCE
IMPACT
4 new Reach Codes adopted across 3CE service area $133,288 in program funds distributed 17 Figure 23: Number of code efforts across agencies
Figure 24: number of code efforts by code type
Code Type Impact
Existing
Building-Single Family
Flexible menu of energy efficiency
measures, electrification measures,
and electric readiness requirements for
major renovations
New
Construction
Flexible menu of energy efficiency
measures, electrification measures,
and electric readiness requirements for
new buildings
Electric
Vehicle
Infrastructure
Increases EV charging spaces for new
developments, remodel projects,
beyond CALGreen code requirements
Table 4: Description of each reach code type implemented this FY

PARTICIPATION

INTERNAL

PERFORMANCE
G
O
A
L
Provide support for 6 Member Agencies
to adopt Reach Codes
KEY

TAKEAWAYS
Success: Inclusion of technical
assistance for code updates facilitated
re-adoption of 2 reach codes
Opportunity: 4 reach codes adopted,
2 updated
IMPACT
CODE

TYPE IMPACT
Existing Building-Single Family
Flexible menu of energy
efficiency measures,
electrification measures, and
electric readiness requirements
for major renovations
New Construction
Flexible menu of energy
efficiency measures,
electrification measures, and
electric readiness requirements
for new buildings
Electric Vehicle
Infrastructure
Increases EV charging spaces
for new developments, remodel
projects, beyond CALGreen
code requirements

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18 CENTRAL COAST COMMUNITY ENERGY

AGRICULTURAL ELECTRIFICATION
Over 142 MT CO2e avoided in FY 2023-24
Program Features FY 2023-24 Impact
Technical assistance, including EV charger feasibility studies & designs, for ag customers looking to electrify their operations Engaged with 4 agricultural customers Program Design Improvement
Agricultural Electrification
Increased the rebate cap to two projects per customer per fiscal year, as well as expanded technical assistance offerings to include more general resources on ag electrification and upcoming regulatory requirements
Program Design Improvements Implemented in FY 2023-24
Agricultural Electrification
Supporting the agricultural industry in the transition from fossil fuels to electricity for agricultural equipment including irrigation Ag. Electrification Program
Incentives for the purchase of all-electric, agricultural equipment for commercial business in or directly
supporting the agriculture industry
FY 2023-24 Budget: $1.8M

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 19

AG ELECTRIFICATION PROGRAM
Incentives for the purchase of all-electric agricultural equipment for commercial businesses in, or directly supporting, the agriculture industry
“The Ag Electrification Program has been instrumental in allowing us to test, try, and purchase new electric equipment at a cheaper cost than a diesel alternative. Thank you!”
- David Brown, DB Heating and Cooling
G
O
A
L
S
Support at least 1 DCFC EV project
Incentivize at least 13 electrification projects
Provide at least 60% of funds to small businesses
Key
Takeaways
Success: The program funded five (5)
compact tractors; an emerging technology
championed by local manufacturers
Opportunity: High density ag regions in the
Counties of Monterey and San Benito
continue to experience low program
participation
Most Funded Equipment:
5 5
Compact Tractors
Standard Tractors
County of
Monterey
County of San
Luis Obispo
County of Santa
Barbara
County of
Santa Cruz
County of San
Benito
Figure 27: Small Business Applications by County
County of
Monterey
County of San
Luis Obispo
County of Santa
Barbara
County of Santa
Cruz
Number of Ag
Accounts
Figure 26: $ Incentivized by County

INTERNAL
Ag Electrification Program
Incentives for the purchase of all-electric agricultural equipment for commercial businesses in, or directly supporting, the agriculture industry
IMPACT

PARTICIPATION
18 applications approved
Figure 25: Applications by
County

PERFORMANCE
$414,058 in incentives distributed
Over $1.28M in all-electric purchases enabled
Customer outreach -
acquisition cost
50% of incentives distributed to small businesses
Figure 28: Top Five (5) funded zip codes relative to Ag rate density in FY 2023-24
Average days to
fund project
Applicant to
rebate ratio:

Eligible applicants
funded
8 100%
$2.7k
69%
Top 5 ZIP: 95076, 93454, 93458, 93923, 93451
142 mT CO2e avoided by incentivizing electric
alternatives to off-road diesel equipment
Tier 1 Projects
10 Tier 2 Projects
8 “The Ag Electrification Program has been instrumental in allowing us to test, try, and purchase new electric equipment at a cheaper cost than a diesel alternative. Thank you!” -SuberBee Rescue County of Santa Barbara
Tier 1: Smaller equipment, Tier 2: Larger equipment
Top 5 Zip
code
designation
19 PARTICIPATION

INTERNAL

PERFORMANCE
IMPACT
G
O
A
L
S
Support at least 1 DCFC EV project
Incentivize at least 13 electrification projects
Provide at least 60% of funds to small businesses
KEY

TAKEAWAYS
Success: The program funded five
(5) compact tractors; an emerging
technology championed by local
manufacturers
Opportunity: High density ag regions
in the Counties of Monterey and San
Benito continue to experience low
program participation

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20 CENTRAL COAST COMMUNITY ENERGY

LOAD MANAGEMENT / DEMAND RESPONSE
Over 180 kWh of residential battery storage capacity installed Program Features FY 2023-24 Impact
Allow 3CE to track enrolled battery performance and
load shifting to ensure program requirements are met.

Over 90 kWh of load shifted daily during 4 pm - 9 pm peak hours; equivalent to 2.7 homes' electricity use in a year.

Program Design Improvement
Demand Side Management The Residential Battery Rebate Program will allow 3CE staff to gain valuable insights into the demand response space before expanding to a larger scale.

Program Design Improvements Implemented in FY 2023-24
Load Management/Demand Response
Supporting grid reliability through customer
load modification strategies
Residential Battery Rebate Program
Incentives to install residential, behind-the-meter
battery storage systems

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 21
GOALS Launch a new, residential battery
rebate program
Key
Takeaways
Success: 50 applications received; high interest in
program’s launch and first quarter
Opportunity: 30% of applications discharging
correctly; 1 income-qualified applicant paid
Over 90 kWh load shifted daily during 4 pm - 9 pm
peak hours
Residential Battery Rebate
Incentives to install residential, behind-the-meter battery storage systems

PARTICIPATION PERFORMANCE
IMPACT

INTERNAL
11 applications approved across 3CE service area $57,800 in incentives distributed Over $374,473 in battery purchases enabled
Average application received $5,255
20% of project cost covered
Figure 31: Added battery capacity
(kWh) by zip code, 180kWh total
Zip code with >25
kWh of added
capacity
(93908, Monterey
County and
95033, Santa Cruz
County)
Battery capacity in kWh
$7,000 distributed to CARE / FERA applicant
21 Figure 33: Applicants connected to load
tracking platform
*1 applicant’s battery manufacturer is unsupported by vendor Figure 32: kWh of load shifted daily during peak period (4-9 PM) per month
Figure 30: Applications received by applicant type
Figure 29: Applications by county
GOALS Launch a new, residential battery
rebate program
Key
Takeaways
Success: 50 applications received; high interest in
program’s launch and first quarter
Opportunity: 30% of applications discharging
correctly; 1 income-qualified applicant paid
Over 90 kWh load shifted daily during 4 pm - 9 pm
peak hours
Residential Battery Rebate
Incentives to install residential, behind-the-meter battery storage systems

PARTICIPATION PERFORMANCE
IMPACT

RESIDENTIAL BATTERY REBATE
Incentives to install residential, behind-the-meter battery storage systems GOALS Launch a new, residential battery
rebate program
Key
Takeaways
Success: 50 applications received; high interest in
program’s launch and first quarter
Opportunity: 30% of applications discharging
correctly; 1 income-qualified applicant paid
Over 90 kWh load shifted daily during 4 pm - 9 pm
peak hours
Residential Battery Rebate
Incentives to install residential, behind-the-meter battery storage systems

PARTICIPATION PERFORMANCE
IMPACT

PARTICIPATION

INTERNAL

PERFORMANCE
IMPACT
G
O
A
L
Launch a new, residential battery
rebate program
KEY

TAKEAWAYS
Success: 50 applications received; high
interest in program’s launch and first quarter
Opportunity: 30% of applications
discharging correctly; 1 income-qualified
applicant paid

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22 CENTRAL COAST COMMUNITY ENERGY

FINDINGS & RECOMMENDATIONS
Overall, 3CE distributed a total of approximately $11 million in incentives and support across the 3CE community in FY 2023-24, a $1.8 million increase from last fiscal year. Preliminary findings and recommendations from the data collected for this Portfolio Evaluation signified a need for a greater focus on incentives for priority populations that lack access to electrification resources across all sectors, opportunities to incentivize behavior shifts through direct customer cost savings, and increased awareness and education about the long-term positive value of electrification.

Program Participation
• 3CE’s Energy Programs served over 1,800 unique applicants across all five counties. The majority of applications are coming from the County of Monterey, County of Santa Cruz, and County of San Luis Obispo, where participation remains concentrated in urbanized areas small areas of the county. Five Energy Programs lacked participation from at least one county. While overall participation in 3CE’s Energy Programs is growing, there are continued needs for increased education, awareness, and outreach to improve accessibility for all customers. • 3CE engaged 43% of Member Agencies in at least one fleet electrification program. The expansion of Plan Your Fleet enabled a 3x increase in program participation and 56% of participants converted to purchasing EVs and/or EV Chargers. While the expansion of Plan Your Fleet is allowing 3CE to meet the immediate needs of Member Agencies, there are long-term opportunities to develop the Electrify and Charge Your Fleet offerings to provide continuous support from design to purchase and installation.

Program Performance
• In FY 2023-24, 3CE utilized 73% of the total Energy Programs budget, a 17% increase from the prior fiscal year.

Moreover, the Electrify Your Ride, Electrify Your Home, New Construction Electrification, and Reach Codes programs exceeded budget expectations. 3CE’s Agricultural Electrification Program continued to experience the lowest performance, emphasizing opportunity to revise scope and design to better support 3CE’s agricultural community. • Cumulatively, the portfolio goals achieved in FY 2023-24 included:
– Transportation Electrification: incentivizing over 1,039 EVs and 698 chargers, distributing over 72% of E-bus funding to disadvantaged communities
– Building Electrification: funding over 297 heat pump water heater and HVAC units, supporting all-electric construction of over 459 housing units
– Ag Electrification: incentivizing over 18 agricultural projects – Load Management / Demand Response: launching a residential battery rebate program Program Impact
• 36% of 3CE’s budget was distributed to equity-qualified projects, including customers enrolled in CARE or FERA programs, Title 1 schools, small businesses, and medical baseline customers. While the E-bus program distributed over 72% of incentives to equity projects, enhanced support is required for the Residential Battery Rebate Program and Electrify Your Home. 3CE is actively conducting listening sessions with stakeholders to gather feedback on various support opportunities.
• 3CE’s Electrify Your Ride Program distributed 7% of incentive funding to commercial customers, who often have larger and more expensive projects. The New Construction Electrification Program saw a lack of participation from designated farmworker housing project developers. While marketing and outreach will continue to programs’ primary customer segments, there is opportunity to explore support secondary customer segments through community feedback and research on electrification barriers throughout the service area.

Internal Resources
• 3CE currently offers various levels of technical assistance to commercial customers and Member Agencies through Electrify Your Ride’s concierge service, Plan Your Fleet, and Reach Codes programs. Plan Your Fleet and Reach Code technical assistance has remained beneficial to Member Agencies, with Plan Your Fleet’s vendor contract expanded this fiscal year to support more participants. Electrify Your Ride’s concierge service engaged with over 23 commercial customers, none of whom ultimately participated in the program. 3CE is actively working to improve assistance and expand services to agricultural customers.
• The Energy Programs team grew to five staff members in the past fiscal year, with two additional recruits planned for FY 2024-25. As a result of staff dedication and agency-wide assistance, 3CE maintained program operations throughout the year, with 3CE customers receiving their rebates, on average, within 25 days after all final documents submitted. 3CE remains committed to maintaining proficient skills and expertise across the team through investment in staff’s professional development and through intentional hiring.

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 23

TRANSPORTATION ELECTRIFICATION
3CE’s Electrify Your Ride Program remains 3CE’s flagship program, enabling over $52 million in transportation electrification purchases for 3CE customers in FY 2023-24. The program has proved successful in assisting residential customers with, on average, 8% of their combined EV and EV charger purchases, as well as assisting in costs required to make electrical upgrades to support EV charging. The program’s marketing and awareness through in-house advertising contributed to over 1,436 unique applicants and will continue with increased focus on South Monterey and San Benito Counties, which experienced the lowest normalized participation per eligible accounts.

Program awareness and electrification education should also continue for all customers, with enhanced support for 3CE customers in our underserved communities. The program was just 5% shy of meeting its goal of 40% funding distribution to income qualified residents. The discrepancy may result from the increasing costs associated with electrifying. EVs continue to become more expensive, with the purchase price of a new EV, on average, being 16% higher than the overall new car market average. This trend makes 3CE’s incentive programs all the more important in enabling affordable electrification to all customers. With changes in market trends, it is important to continue refining incentive offerings including enhanced incentives for the underserved community.

While EV adoption in general and participation in programs like Electrify Your Ride is on the rise, EV purchases are significantly outpacing installation of new public and shared EV charging infrastructure. The California Energy Commission’s latest EV Infrastructure Assessment Report set a target of one million EV chargers by 2030 and two million EV chargers by 2035. However, at present, California only has 200,000 public and shared EV chargers, this continues to emphasize the lack of publicly accessible and workplace EV charging available. In response, 3CE has launched an EV Charging Asset Pilot that includes 3CE-owned and operated Level 2 and DC Fast EV chargers for both workplace and publicly available charging. This pilot will enable 3CE to learn the steps needed to take a more proactive stance in eliminating barriers to everyday charging accessibility across 3CE’s service area. 3CE’s E-bus Program was expanded in FY 2023-24 to allow incentives for multiple e-bus purchases, enabling over $11.6M in school and transit electrification for public and transit agencies across 3CE’s service area. 3CE’s Plan Your Fleet Program saw a 3x increase in participation from last fiscal year, expanding to support over nine Member Agencies in their fleet and charging infrastructure plans. Despite the increased assistance offered through Plan Your Fleet, only 56% of participants also purchased EVs and EV chargers through Electrify Your Fleet and/or Charge Your Fleet. While long implementation timelines do delay program participation in Electrify and Charge Your Fleet, there is an opportunity to create a continuous transition from electrification planning to electrification purchases, incorporating successes from the E-bus program expansion and extending technical assistance opportunities to all public agencies through a Public Agency Electrification Program.

2. https://www.coxautoinc.com/market-insights/kbb-atp-december-2023/ LOOKING AHEAD...
• Continue supporting Electrify Your Ride by refining incentive offerings, with continued focus on 3CE’s underserved communities.
• Construct an EV Charging Asset Pilot that includes 3CE-owned and operated Level 2 and DC Fast EV chargers for both workplace and publicly available charging.
• Develop a Public Agency Electrification Program that encompasses a continuous transition from electrification planning to electrification purchases.

Electrify Your Ride
Electric Bus
Plan Your Fleet
Charge Your Fleet
Electrify Your Fleet
Transportation Grants
Electrify Your Ride
EV Charger Asset Program
Public Agency Fleet Electrification
Transportation Electrification
Looking Ahead...

Construct an EV Charging Asset Pilot that includes 3CE-owned and operated Level 2 and DC Fast EV chargers for both workplace and publicly available charging.

Develop a Public Agency Electrification Program that encompasses a continuous transition from electrification planning to electrification purchases.
3CE’s Electrify Your Ride Program remains 3CE’s flagship program, enabling over $52 million in transportation electrification purchases for 3CE customers in FY 2023-24. The program has proved successful in assisting residential customers with, on average, 8% of their combined EV and EV charger purchases, as well as assisting in costs required to make electrical upgrades to support EV charging. The program’s marketing and awareness through in-house advertising contributed to over 1,436 unique applicants and will continue with increased focus on South Monterey and San Benito Counties, which experienced the lowest normalized participation per eligible accounts.

With changes in market trends, it is important to continue refining incentive offerings including enhanced incentives for the underserved community.

While EV adoption in general and participation in programs like Electrify Your Ride is on the rise, EV purchases are significantly outpacing installation of new public and shared EV charging infrastructure. The California Energy Commission’s latest EV Infrastructure Assessment Report set a target of one million EV chargers by 2030 and two million EV chargers by 2035. However, at present, California only has 200,000 public and shared EV chargers, this continues to emphasize the lack of publicly accessible and workplace EV charging available. In response, 3CE has launched an EV Charging Asset Pilot that includes 3CE-owned and operated Level 2 and DC Fast EV chargers for both workplace and publicly available charging. This pilot will enable 3CE to learn the steps needed to take a more proactive stance in eliminating barriers to everyday charging accessibility across 3CE’s service area.
3CE’s E-bus Program was expanded in FY 2023-24 to allow incentives for multiple e-bus purchases, enabling over $11.6M in school and transit electrification for public and transit agencies across 3CE’s service area. 3CE’s Plan Your Fleet Program saw a 3x increase in participation from last fiscal year, expanding to support over nine Member Agencies in their fleet and charging infrastructure plans. Despite the increased assistance offered through Plan Your Fleet, only 56% of participants also purchased EVs and EV chargers through Electrify Your Fleet and/or Charge Your Fleet. While long implementation timelines do delay program participation in Electrify and Charge Your Fleet, there is an opportunity to create a continuous transition from electrification planning to electrification purchases, incorporating successes from the E-bus program expansion and extending technical assistance opportunities to all public agencies through a Public Agency Electrification Program.

2. https://www.coxautoinc.com/market-insights/kbb-atp-december-2023/ 2 23

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24 CENTRAL COAST COMMUNITY ENERGY

BUILDING ELECTRIFICATIONS
3CE’s New Construction Electrification Program exceeded its incentive budget in FY 2023-24 by distributing over $1.1 million in incentives to support new, all-electric housing units across 3CE’s service area. The program design was enhanced this fiscal year to include incentives for market-rate housing, which represented 46% of total units incentivized. While the program funded 24% more affordable housing units in comparison to last FY, there was no participation from qualified farmworker housing developments. Through pursuing opportunities for feedback from housing developers, county planning departments, and key agricultural stakeholders, 3CE can better understand the farmworker housing landscape and regulations around farmworker housing to ultimately inform program design improvements that support opportunities for agricultural-employee housing electrification. 3CE’s Electrify Your Home Program continues to see participation grow resulting in a 49% increase in budget spend compared to the previous fiscal year. In FY2023-24 the program ddistributed396 heat pump rebates, resulting in an increase of 153 rebates distributed as compared to the prior fiscal year. Electrify Your Home Program’s partnership with TECH Clean California enables customers to take advantage of state and 3CE funds, but also restricts 3CE’s funding longevity for completed projects, and limits 3CE’s ability to explore fundamental program enhancements to improve access to the program. Income-qualified applicants in the Electrify Your Home Program remained low at 6% this fiscal year, and about 2% overall since the program launched in 2022. Furthermore, there was lack of participation from income-qualified customers in the County of Santa Cruz despite the availability of eligible contractors. In addition, there was a lack of participation from income qualified single-family projects, despite single family homes making up the majority of projects overall.

Given the need to address TECH Clean California funding deficit, lack of participation from income-qualified customers, and the narrowing of eligible contractors to only those enrolled in the TECH program, 3CE determined an overall review of the program, involving community input, was needed. In collaboration with 3CE’s Community Advisory Committee, the agency conducted a public outreach process beginning in October 2024 to improve the overall administration of the program, and explore prospective improvements such as direct install, home assessments, broaden contractor eligibility, and expand rebate offerings in an Electrify Your Home V2.0 Program. 3CE’s Reach Code Program supported four member agencies with technical assistance to develop and adopt four reach codes, anticipated to impact over 140 permits per year and result in construction of 100 EV charger projects by 2030. Furthermore, 100% of the Reach Codes developed under 3CE’s program were approved unanimously by the governing boards of each jurisdiction. While the program received high participation in FY 2023-24, there continues to be concern about legal challenges to building codes that go beyond state requirements. Therefore, there is a continued need for education around Reach Code benefits, assistance in drafting and/or development of, and advocacy for implementation. Furthermore, Building Codes continue to update every three years and therefore Member Agencies require occasional limited assistance to update Reach Codes, including answering technical questions, developing customized reach codes, preparing proposals to councils, and developing implementation tools to help cities and counties enforce their reach codes. With various political, social, and environmental sensitivities around Reach Code adoption, assistance could be expanded to include marketing, outreach and education to assist member agencies in navigating the changing landscape.

LOOKING AHEAD...
• Continue building relationships with developers to understand the building electrification landscape, and work with local planning departments to support opportunities for agricultural-employee housing electrification
• Review the Electrify Your Home Program with community input and participant feedback to improve the overall administration of the program, and explore prospective improvements such as direct install, home assessments, broaden contractor eligibility, and expand rebate offerings in an Electrify Your Home V2.0 Program.
• Consider increasing investment in Reach Code adoption to include marketing, outreach and education to assist member agencies in navigating the changing landscape.

New Construction Electrification
Reach Codes
Electrify Your Home
New Construction Electrification
Reach Codes
Electrify Your Home v2.0
3CE’s New Construction Electrification Program exceeded its incentive budget in FY 2023-24 by distributing over $1.1 million in incentives to support new, all-electric housing units across 3CE’s service area. The program design was enhanced this fiscal year to include incentives for market-rate housing, which represented 46% of total units incentivized. While the program funded 24% more affordable housing units in comparison to last FY, there was no participation from qualified farmworker housing developments. Through pursuing opportunities for feedback from housing developers, county planning departments, and key agricultural stakeholders, 3CE can better understand the farmworker housing landscape and regulations around farmworker housing to ultimately inform program design improvements that support opportunities for agricultural-employee housing electrification. 3CE’s Electrify Your Home Program continues to see participation grow resulting in a 49% increase in budget spend compared to the previous fiscal year. In FY2023-24 the program ddistributed396 heat pump rebates, resulting in an increase of 153 rebates distributed as compared to the prior fiscal year. Electrify Your Home Program’s partnership with TECH Clean California enables customers to take advantage of state and 3CE funds, but also restricts 3CE’s funding longevity for completed projects, and limits 3CE’s ability to explore fundamental program enhancements to improve access to the program. Income-qualified applicants in the Electrify Your Home Program remained low at 6% this fiscal year, and about 2% overall since the program launched in 2022. Furthermore, there was lack of participation from income-qualified customers in the County of Santa Cruz despite the availability of eligible contractors. In addition, there was a lack of participation from income qualified single-family projects, despite single family homes making up the majority of projects overall.

Furthermore, 100% of the Reach Codes developed under 3CE’s program were approved unanimously by the governing boards of each jurisdiction. While the program received high participation in FY 2023-24, there continues to be concern about legal challenges to building codes that go beyond state requirements. Therefore, there is a continued need for education around Reach Code benefits, assistance in drafting and/or development of, and advocacy for implementation. Furthermore, Building Codes continue to update every three years and therefore Member Agencies require occasional limited assistance to update Reach Codes, including answering technical questions, developing customized reach codes, preparing proposals to councils, and developing implementation tools to help cities and counties enforce their reach codes. With various political, social, and environmental sensitivities around Reach Code adoption, assistance could be expanded to include marketing, outreach and education to assist member agencies in navigating the changing landscape.

Building Electrification
Looking Ahead...

Continue building relationships with developers to understand the building electrification landscape, and work with local planning departments to support opportunities for agricultural-employee housing electrification Review the Electrify Your Home Program with community input and participant feedback to improve the overall administration of the program, and explore prospective improvements such as direct install, home assessments, broaden contractor eligibility, and expand rebate offerings in an Electrify Your Home V2.0 Program.

Consider increasing investment in Reach Code adoption to include marketing, outreach and education to assist member agencies in navigating the changing landscape.

New Construction Electrification
Reach Codes
Electrify Your Home
New Construction Electrification
Reach Codes
Electrify Your Home v2.0
24

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 25

AGRICULTURAL ELECTRIFICATION
3CE’s Ag Electrification Program enhanced offerings this fiscal year to allow up to 2 rebates per customer, resulting in over $1.28 million in all-electric purchases supported by rebates for ag customers. However, the Program continues to experience low participation, even in with high density ag regions such as Monterey and San Benito counties. This trend motivated 3CE staff to conduct listening sessions in FY 2023-24 to hear directly from the agricultural community in 3CE’s service area about the barriers to ag electrification. Key takeaways included: perceived lack of grid capacity for EV chargers, need for technical support, high upfront purchase cost with uncertainty of new technology benefit, and general need to minimize both operational and upfront capital risks associated with ag electrification.

An example of the electrification challenges in agricultural technologies can be seen with electric tractors. The electric tractor market is still new and expected to have a compounded annual growth rate (CAGR) of 13%, driven by improvements in battery energy density, charging infrastructure, and range. Furthermore, 3CE’s Ag Electrification focused listening session in Santa Maria included participant comments related to questions in reliability for new electrification technology and need for availability of infrastructure for charging. To improve support for customers that are navigating the lack of charging infrastructure for ag equipment, 3CE expanded the Ag Electrification program to include technical assistance for installing DC Fast Charging infrastructure for Ag operations, including development of a toolkit with resources for Ag customers expected to be completed in 2025.

T3CE sees an opportunity to better align the Ag Electrification program with customer needs by conducting outreach to gather input, and researching the ag electrification landscape and benefits of emerging technologies. 3CE plans to inform an improved Ag Electrification v2.0 Program that provides impactful support and assistance to 3CE ag customers in their electrification journeys. This would follow a similar community-based input process for enhancements being made to Electrify Your Home 2.0 and could begin as part of the FY2025-26 CAC workplan.

In addition to reducing the cost of electric ag equipment, 3CE has engaged in the Hourly Flex Pricing Expanded Pilot 1, which provides an opportunity for savings on customers’ monthly energy bills. The program encourages ag customers to proactively shift operations away from times with high grid demand and therefore more costly energy prices through real time pricing and hourly forecasts. Early participation in the pilot will inform opportunities to expand the offering to eligible 3CE residential and commercial customers.

If this initial pilot is successful, 3CE will consider designing a dedicated 3CE Ag Automation Pilot, incorporating from the prior pilot’s successes.

3. https://www.coxautoinc.com/market-insights/kbb-atp-december-2023/ LOOKING AHEAD...
• Continue awareness and education campaigns to ag customers around the benefits of electrification and resources available and explore methods that directly minimize the upfront capital burden on customers with limited funding resources.
• Collect feedback from customers and conduct additional research on the ag electrification landscape and benefits of emerging technologies, to create an improved Ag Electrification v2.0 Program that provides impactful support and assistance to 3CE ag customers in their electrification journeys. • Enable ag customers to save energy costs directly through an Hourly Flex Pricing Expanded Pilot 1, which will facilitate the shifting of operations during peak times through real time pricing for week ahead hourly forecasts.

Ag Electrification Program
Hourly Flex Pricing Expanded Pilot 1
Ag Electrification v2.0
Ag Automation Pilot33
Agricultural Electrification
3CE's Ag Electrification Program enhanced offerings this fiscal year to allow up to 2 rebates per customer, resulting in over $1.28 million in all-electric purchases supported by rebates for ag customers. However, the Program continues to experience low participation, even in with high density ag regions such as Monterey and San Benito counties. This trend motivated 3CE staff to conduct listening sessions in FY 2023-24 to hear directly from the agricultural community in 3CE’s service area about the barriers to ag electrification. Key takeaways included: perceived lack of grid capacity for EV chargers, need for technical support, high upfront purchase cost with uncertainty of new technology benefit, and general need to minimize both operational and upfront capital risks associated with ag electrification.

The Hourly Flex Pricing Expanded Pilot 1 also provides technical support and automation rebates, allowing ag customers to work directly with an approved vendor to select and purchase an automation controller that will allow ag customers to shift load to lower cost and more renewable times of the day without manually turning on and off pumps. If this initial pilot is successful, 3CE will consider designing a dedicated 3CE Ag Automation Pilot, incorporating from the prior pilot’s successes.

Looking Ahead...

Continue awareness and education campaigns to ag customers around the benefits of electrification and resources available and explore methods that directly minimize the upfront capital burden on customers with limited funding resources.

Collect feedback from customers and conduct additional research on the ag electrification landscape and benefits of emerging technologies, to create an improved Ag Electrification v2.0 Program that provides impactful support and assistance to 3CE ag customers in their electrification journeys.

Enable ag customers to save energy costs directly through an Hourly Flex Pricing Expanded Pilot 1, which will facilitate the shifting of operations during peak times through real time pricing for week ahead hourly forecasts.

Ag Electrification Program
Hourly Flex Pricing Expanded Pilot 1
Ag Electrification v2.0
Ag Automation Pilot
3 3. https://www.coxautoinc.com/market-insights/kbb-atp-december-2023/ 25

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26 CENTRAL COAST COMMUNITY ENERGY

LOAD MANAGEMENT / DEMAND RESPONSE
The Residential Battery Rebate Program was launched in Q4 of 2024 to support customers in their adoption of residential battery storage systems. The program was positively received by the community, including positive media coverage from solar installers, and has added 180 kWh of battery storage capacity. However, the program saw low compliance with battery discharge requirements, resulting in only 30% of applications discharging their battery correctly and receiving the rebate. To address this customer adoption barrier, 3CE is working with the program vendor to offer the option of a simple opt-in link for battery discharge scheduling, which will allow customers to more easily meet discharge requirements during peak hours between 4 pm - 9 pm.

In the first six months of the Program’s launch, 46% of enrolled customers have a leased battery system. Of the CARE or FERA customers, 66% of applications were with leased battery systems. Consequently, allowing participation for leased battery systems will support customers’ upfront capital costs and align with the program’s goal of 15% participation by income-qualified customers.

While the Residential Battery Rebate Program has resulted in over 90 kWh load shifted daily during peak hours, there is opportunity to increase this number through a Battery Storage Demand Response (DR) Pilot that would include commercial scale offerings and engage with the California Energy Commission’s Demand Side Grid Support Program for event trigger incentives. Staff is considering a pilot that would allow 3CE to take active control of customers’ batteries within agreed to parameters. The batteries then have the potential to be aggregated into a larger Virtual Power Plant (VPP) to increase the impact in locations experiencing grid stress.

In Q1 2025, 3CE will participate in an Hourly Flex Pricing Expanded Pilot 2. Will start in Q1 2025. This real-time pricing pilot will allow commercial and residential customers to review forecast rates a week ahead and modify their load to match the least cost hours. These dynamic rates will empower customers to both save money and use more renewable energy.

Finally, 3CE is researching technologies and vendors for a possible Bi-Directional Charging Pilot. This could be in partnership with 3CE’s EV Charger Asset Pilot, where one could charge their EV at work during the day when the power is lower cost and more renewable and then discharge a portion of their EV battery at home during peak hours, reducing cost and associated emissions.

LOOKING AHEAD...
• Implement Hourly Flex Pricing Expanded Pilot 2 to test the impact of real time pricing to reduce customer cost and increase use of renewable energy.
• Assist customers with meeting Residential Battery Storage Program requirements though an opt-in scheduling tool and customer-facing dashboard.
• Explore further expanding demand response offerings through a Battery Storage Demand Response Pilot with active control of battery discharge and a Bi-Directional Charging Pilot for maximizing use of EV batteries.

Residential Battery Rebate
Battery Storage DR Pilot
Bi-Directional Charging Pilot
Hourly Flex Pricing Pilot 2
The Residential Battery Rebate Program was launched in Q4 of 2024 to support customers in their adoption of residential battery storage systems. The program was positively received by the community, including positive media coverage from solar installers, and has added 180 kWh of battery storage capacity. However, the program saw low compliance with battery discharge requirements, resulting in only 30% of applications discharging their battery correctly and receiving the rebate. To address this customer adoption barrier, 3CE is working with the program vendor to offer the option of a simple opt-in link for battery discharge scheduling, which will allow customers to more easily meet discharge requirements during peak hours between 4 pm - 9 pm.

In Q1 2025, 3CE will participate in an Hourly Flex Pricing Expanded Pilot 2. will start in Q1 2025. This real-time pricing pilot will allow commercial and residential customers to review forecast rates a week ahead and modify their load to match the least cost hours. These dynamic rates will empower customers to both save money and use more renewable energy.

Load Management / Demand Response
Looking Ahead...

Implement Hourly Flex Pricing Expanded Pilot 2 to test the impact of real time pricing to reduce customer cost and increase use of renewable energy.

Assist customers with meeting Residential Battery Storage Program requirements though an opt-in scheduling tool and customer-facing dashboard.

Explore further expanding demand response offerings through a Battery Storage Demand Response Pilot with active control of battery discharge and a Bi-Directional Charging Pilot for maximizing use of EV batteries.

Residential Battery Rebate
26 Battery Storage DR Pilot
Bi-Directional Charging Pilot
Hourly Flex Pricing Pilot 2

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 27

LOOKING AHEAD & CONCLUSION
Central Coast Community’s Energy Programs invested $11 million to support customers in avoiding over 3,758 MT CO2e emissions. The portfolio evaluation emphasized 3CE’s continued efforts to improve accessibility of programs to all customers, strengthen support and technical assistance in electrification projects, and enhance opportunities for underserved communities. Through further analyzing findings and implementing recommendations discussed in the evaluation, 3CE is solidly on a path to growing our impact on the Central Coast through energy programs that reduce greenhouse gas emissions and support 3CE’s local economy.

In the coming years, 3CE will continue to administer and enhance its Energy Programs portfolio to increase participation, improve performance, and expand impact. Below is a path for this portfolio enhancement based on the recommendations contained in this report. The forward view creates equivalent emphasis in each area of concentration and creates an avenue whereby our programs can directly support the agency’s core mission of reducing reliance of fossil fuels on our energy grid.

The ongoing success of 3CE’s Energy Programs relies on support and input from the community. Feedback from customers, community members, Member Agencies, and board and council members will inform future program design, implementation, outreach, budgeting, evaluation, and reporting. Each of these areas will evolve over time as a reflection of the agency’s commitment to continual learning and improvement.

Please direct comments and feedback to: [email protected] RECOMMENDED 3CE ENERGY PROGRAMS PORTFOLIO
Transportation
Electrification
Electrify Your Ride
EV Charger Asset Program
Public Agency Fleet Elect.

Building Electrification
New Construction Elect.

Reach Codes
Electrify Your Home v2.0
Agricultural
Electrification
Hourly Flex Pricing Pilot 1
Ag. Electrification v2.0
Ag Automation Pilot
Demand Response
Battery Storage DR Pilot
Bi-Directional Charging Pilot
Hourly Flex Pricing Pilot 2
CURRENT 3CE ENERGY PROGRAMS PORTFOLIO
Building Electrification
New Construction Elect.

Reach Codes
Electrify Your Home
Agricultural
Electrification
Ag. Electrification Program
Demand Response
Residential Battery Rebate
Transportation
Electrification
Electrify Your Ride
Electric Bus
Plan Your Fleet
Charge Your Fleet
Electrify Your Fleet
Transportation Grants

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28 CENTRAL COAST COMMUNITY ENERGY
APPENDIX A: GREENHOUSE GAS EMISSIONS

CALCULATIONS INPUTS, CONVERSION

FACTORS, AND SOURCES
For transportation and agricultural electrification projects, the annual energy consumption in terms of kilowatt-hours (kWh) was calculated for both conventional and electric systems. The emissions associated with gasoline (passenger vehicles) and diesel (all Type A, C buses, transit buses, and off-road mobile agricultural equipment) were then converted to their CO2 equivalencies based on emissions factors and carbon intensity of the local grid. Building electrification projects included only those with a Heat Pump Water Heater incentive, utilizing previously determined energy usage and emissions avoidance by the New Buildings Institute for a more streamlined calculation. The overall approach used emissions factors specific to the 3CE service area and employed modified State protocols for emissions calculations to ensure conservative and transparent reporting. For transportation and agricultural electrification projects, the annual energy consumption in terms of kilowatt-hours (kWh) was calculated for both conventional and electric systems. The emissions associated with gasoline (passenger vehicles) and diesel (all Type A, C buses, transit buses, and off-road mobile agricultural equipment) were then converted to their CO2 equivalencies based on emissions factors and carbon intensity of the local grid. Building electrification projects included only those with a Heat Pump Water Heater incentive, utilizing previously determined energy usage and emissions avoidance by the New Buildings Institute for a more streamlined calculation. The overall approach used emissions factors specific to the 3CE service area and employed modified State protocols for emissions calculations to ensure conservative and transparent reporting.

Emissions Factors/Intensities Value Unit Source
Gasoline 8.78 kgCO2e/gal 1
Diesel 10.21 kgCO2e/gal 1
Average Emissions Intensity 1 0.247 tCO2e/MWh 2
Average Emissions Intensity 2 0.363 tCO2e/MWh 3
E-bus -Transit Bus Value Unit Source
Avg fuel economy 3.40 MPG 5(2)
Miles driven per year 42940 Miles 5(1)
Gallons diesel per year 9605 Gasoline Gallon
Equivalent 5(3)
EV efficiency 3.6 kWh/mile 8
Water Heater Value Unit Source
Gas Water Heater 1433 Kg CO2e/yr 9
Heat Pump Water Heater 1219 kWh/yr 9
Gallons diesel per year 9605 Gasoline Gallon
Equivalent 5(3)
EV efficiency 3.6 kWh/mile 8
E-bus -Type C Value Unit Source
Avg fuel economy 6 MPG 5(2), 7
Miles driven per year 6993 Miles/year 5(1)
Gallons gasoline per year 2123 Gallons/year 5(3)
EV efficiency 42940 kWh/mile 8
Passenger Vehicle Value Unit Source
Avg fuel economy 25 Miles per gallon 4, 5(2)
Miles driven per year 10000 Miles/year 5(1), 6
Metric tons CO2e/year
(passenger) 4.60 MTCO2e/year 6
Gallons gas per year 400 Gallons/year 5(3), 6
EV kWh per year 3460 kWh/year conversion
Ag equipment (50
HP equipment) Value Unit Source
Annual Hours used 1000 Hours/year 10
CO2e equivalent 32.9 lbs/hour CO2e 10
CO2e equivalent 14.92 Kg/hour CO2e conversion
1 HP equivalency 0.736 kW conversion
Energy Economy
Ratio 3.8 n/a 11
Diesel Energy
Content 11.6 kWh/kg 12
E-bus -Type A Value Unit Source
Avg fuel economy 6.2 MPG 5(2), 7
Miles driven per year 14302 Miles 5(1)
Gallons diesel per year 636 Gasoline Gallon
Equivalent 5(3)
EV Efficiency 2.84 kWh/mile 8
E-bus -Type C Value Unit Source
Avg fuel economy 6 MPG 5(2), 7
Miles driven per year 6993 Miles/year 5(1)
Gallons gasoline per year 2123 Gallons/year 5(3)
EV efficiency 42940 kWh/mile 8

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2023-2024 ENERGY PROGRAMS PORTFOLIO EVALUATION 29
APPENDIX A: GREENHOUSE GAS EMISSIONS

CALCULATIONS INPUTS, CONVERSION

FACTORS, AND SOURCES
Source # Source Name Link
1 EPA https://www.epa.gov/system/files/documents/2022-04/ghg_ emission_factors_hub.pdf
2 3CE Power Content Label (2021) https://www.energy.ca.gov/filebrowser/download/4606 3 3CE Power Content Label (2024) https://3cenergy.org/wp-content/uploads/2025/01/3CE-2024-PCL-R7-FINAL.pdf 4 United States Department of
Transportation
https://www.bts.gov/content/average-fuel-efficiency-us-light-duty-vehicles 5 United States Department of
Energy
https://afdc.energy.gov/data/10309 https://afdc.energy.gov/ data/10310 https://afdc.energy.gov/data/10308
6 EPA
https://www.epa.gov/greenvehicles/greenhouse-gas-emissions-typical-passenger-vehicle#:~:text=A%20typical%20passenger%20 vehicle%20emits,of%20miles%20driven%20per%20year.
7 CARB ZEB Pilot Deployment
Project
https://ww2.arb.ca.gov/sites/default/files/2021-10/sac%20ze%20 school%20bus%20deployment%20project%20final%20report.pdf 8 CARB SDMTS ZEB Transition https://ww2.arb.ca.gov/sites/default/files/2020-12/SDMTS_ZEB_ Fleet%20Transition%20StudyADA12072020.pdf
9 New Buildings Institute HPWH vs Gas Tank CO2e Calculator.xlsx 10 CARB Ag Equipment Emissions
Inventory
https://ww2.arb.ca.gov/sites/default/files/2021-07/AG2021_ Technical_Documentation_Final_DRAFT_ADA_PDFA.pdf
11 CARB GHG Quantification
Methodology – Off Road
https://ww2.arb.ca.gov/sites/default/files/auction-proceeds/carb_ offatd_finalqm_16-17.pdf
12 US DOE Fuel Properties
comparison https://afdc.energy.gov/fuels/properties

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CONTACT
3CE NORTHERN OFFICE
70 Garden Court Suite 300
Monterey, CA 93940
For all PG&E customers
Email: [email protected]
3CE SOUTHERN OFFICE
1026 Palm Street
San Luis Obispo, CA 93401
For all SCE customers
Email: [email protected]

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Staff Report Item 5
TO: 3CE Policy Board of Directors
FROM: Robert M. Shaw, Chief Executive Officer
PREPARED BY: Gina Urmatan, Senior Accountant
SUBJECT: Financial Report for the period of October 1, 2024, through March 31, 2025 DATE: June 18, 2025
RECOMMENDATION:

Receive a financial report for the period October 1, 2024, through March 31, 2025.

SUMMARY:

Over the six months ending March 31, 2025, operating revenues amounted to $300.0 million, and operating expenses totaled $238.6 million for a net operating income of $61.1 million. Non-operating revenue of $5.4 million, driven by interest and investment returns, netted the month with a net position increase of $66.6 million.

Year-to-date operating revenue is $32.5 million below budget, primarily due to a lower-than-expected retail load that is partially offset by settlement fund receipts. 3CE is actively monitoring retail load projections and has adjusted the forecast downward in March 2025 as part of the electric generation rate adjustments approved by the Policy Board effective April 1, 2025. Non-operating revenue from investment returns from assets held in operating, investment accounts, and interest on collateral exceeded the budget with a variance of $2.0 million, resulting from a favorable short-term interest rate.

Year-to-date total revenue is $30.5 million lower than budget, an unfavorable variance of 9%.

Year-to-date operating expenditures, excluding capital outlay, are $47.4 million below budget, a variance of 17%. The primary driver of this favorable variance is lower-than-expected energy costs.

Energy expenses came in $40.0 million under budget, largely due to a combination of lower market prices for energy and renewable energy attributes required for Renewable Portfolio Standard (RPS) compliance, stronger-than-anticipated congestion revenue rights income, and delays in invoicing for Renewable Energy Certificate (REC) products. Non-energy operating costs were $7.5 million lower than

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budget due to less-than-planned costs for contracted services, energy programs, and staff vacancies.

The capital outlay was below budget by $5.8 million since capital projects are not recorded as direct expenditures. Instead, these projects are recorded as capital assets on the balance sheet and are expensed over time through depreciation following accounting principles. Year-to-date total expenditures, including capital outlay, are $53.2 million lower than the budget, a variance of 18%. These variances will decrease over the fiscal year as 3CE fulfills its energy obligations, including resource adequacy (RA) and renewable energy credits (RECs).

The net position at the end of March 31, 2025, totaled $284.7 million, a $66.6 million increase from the start of the fiscal year. The increase is primarily due to growth in accounts receivable, deposits held by counterparties to meet collateral obligations, and capital assets, offset by lower accrued cost of electricity and other accrued liabilities. Cash, cash equivalents, and investments totaled $236.5 million, a $9.8 million increase from the start of the fiscal year. The increase in liquidity was driven by operating revenue and a decrease in collateral postings required by energy counterparties from exposure in certain energy transactions.

FISCAL IMPACT:

There is no financial impact associated with receiving this report.

ATTACHMENT(S):

1. March 31, 2025 Financial Report

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FINANCIAL REPORT
Fiscal Year to Date
As of March 31, 2025

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ACCOUNTANTS’ COMPILATION REPORT
Board of Directors
Central Coast Community Energy
Management is responsible for the accompanying financial statements of Central Coast Community Energy (a California Joint Powers Authority) which comprise the statement of net position as of March 31, 2025, and the related statement of revenues, expenses, and changes in net position, and the statement of cash flows for the six months then ended in accordance with accounting principles generally accepted in the United States of America. We have performed a compilation engagement in accordance with Statements on Standards for Accounting and Review Services promulgated by the Accounting and Review Services Committee of the AICPA. We did not audit or review the accompanying statements nor were we required to perform any procedures to verify the accuracy or completeness of the information provided by management. Accordingly, we do not express an opinion, conclusion, nor provide any assurance on these financial statements.

Management has elected to omit substantially all of the note disclosures required by accounting principles generally accepted in the United States of America in these interim financial statements.

Central Coast Community Energy’s annual audited financial statements include the note disclosures omitted from these interim statements. If the omitted disclosures were included in these financial statements, they might influence the user’s conclusions about the Authority’s financial position, results of operations, and cash flows. Accordingly, these financial statements are not designed for those who are not informed about such matters.

We are not independent with respect to the Authority because we performed certain accounting services that impaired our independence.

Maher Accountancy
San Rafael, CA
April 29, 2025
1101 Fifth Avenue, Suite 200 San Rafael, CA 94901 415 459 1249 mahercpa.com

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Current assets
Cash and cash equivalents $ 149,724,109
Accounts receivable, net of allowance 49,595,286
Accrued revenue 31,203,747
Other receivables 2,036,262
Investments 79,275,272
Prepaid expenses 1,545,325
Deposits 41,505,326
Loan receivable 192,501
Total current assets 355,077,828
Noncurrent assets
Investments 7,517,188
Deposits 21,055
Loan receivable 1,233,381
Capital assets, net of depreciation and amortization 6,418,331 Total noncurrent assets 15,189,955
Total assets 370,267,783
Current liabilities
Accrued cost of electricity 54,925,395
Accounts payable 1,123,106
Other accrued liabilities 2,044,502
User taxes and energy surcharges due to other governments 2,005,262 Security deposits - energy suppliers 15,384,299
Lease liability 338,225
Total current liabilities 75,820,789
Noncurrent liabilities
Security deposits - energy suppliers 9,050,025
Lease liability 669,288
Total noncurrent liabilities 9,719,313
Total liabilities 85,540,102
Net investment in capital assets 5,410,818
Unrestricted 279,316,863
Total net position $ 284,727,681

NET POSITION
As of March 31, 2025

STATEMENT OF NET POSITION

CENTRAL COAST COMMUNITY ENERGY
ASSETS

LIABILITIES

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OPERATING REVENUES
Electricity sales, net $ 291,614,974
Liquidated damages 8,101,745
Other income 44,540
Total operating revenues 299,761,259

OPERATING EXPENSES
Cost of electricity 221,080,099
Contract services 7,122,290
Staff compensation 4,660,195
Other operating expenses 965,645
Program incentives 4,519,370
Depreciation and amortization 298,492
Total operating expenses 238,646,091
Operating income (loss) 61,115,168

NONOPERATING REVENUES (EXPENSES)
Investment income 5,471,853
Interest and financing costs (24,783)
Nonoperating revenues (expenses) 5,447,070
CHANGE IN NET POSITION 66,562,238
Net position at beginning of period 218,165,443
Net position at end of period $ 284,727,681
Six Months Ended March 31, 2025

AND CHANGES IN NET POSITION

STATEMENT OF REVENUES, EXPENSES

CENTRAL COAST COMMUNITY ENERGY

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CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers $ 291,458,522
Receipts of liquidated damages 8,101,745
Other operating receipts 12,822,434
Receipts of deposits and collateral 35,510,023
Payments to suppliers for electricity (252,055,166)
Payments for other goods and services (8,264,014)
Payments for deposits and collateral (51,170,150)
Payments for program incentives (7,073,601)
Payments for staff compensation (4,525,173)
Payments of taxes and energy surcharges to other governments (5,228,042) Net cash provided by operating activities 19,576,578

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES
Payments of lease liability (184,221)
Purchases of capital assets (2,851,243)
Net cash provided (used) by capital and related financing activities (3,035,464)

CASH FLOWS FROM INVESTING ACTIVITIES
Investment income received 3,379,480
Proceeds from sales and maturities of investments 77,512,000 Principal payments received of loan receivable 94,915
Purchase of investments (98,343,081)
Net cash provided (used) by investing activities (17,356,686) Net change in cash and cash equivalents (815,572)
Cash and cash equivalents at beginning of year 150,539,681 Cash and cash equivalents at end of period $ 149,724,109 Unrealized appreciation (depreciation) and
timing differences in investment income $ 2,092,373
Six Months Ended March 31, 2025

STATEMENT OF CASH FLOWS

CENTRAL COAST COMMUNITY ENERGY

NONCASH INVESTING ACTIVITES

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Operating income (loss) $ 61,115,168
Adjustments to reconcile operating income (loss) to net cash provided by operating activities
Depreciation and amortization expense 298,492
(Increase) decrease in:

Accounts receivable, net of allowance (5,157,391)
Accrued revenue (255,217)
Other receivables 4,548,012
Prepaid expenses 283,899
Deposits (29,872,533)
Increase (decrease) in:

Accrued cost of electricity (21,847,851)
Accounts payable (3,766,361)
Other accrued liabilities 1,220,345
User taxes and energy surcharges due to other governments 28,114 Security deposits - energy suppliers 12,981,900
Net cash provided by operating activities $ 19,576,578

CENTRAL COAST COMMUNITY ENERGY
STATEMENT OF CASH FLOWS (continued)
Six Months Ended March 31, 2025

RECONCILIATION OF OPERATING INCOME (LOSS) TO NET

CASH PROVIDED BY OPERATING ACTIVITIES

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ACCOUNTANTS’ COMPILATION REPORT
Board of Directors
Central Coast Community Energy
Management is responsible for the accompanying special purpose budgetary comparison schedule of Central Coast Community Energy (a California Joint Powers Authority) for the one and six months ended March 31, 2025, and for determining that the budgetary basis of accounting is an acceptable financial reporting framework. We have performed a compilation engagement in accordance with Statements on Standards for Accounting and Review Services promulgated by the Accounting and Review Services Committee of the AICPA. We did not audit or review the accompanying statement nor were we required to perform any procedures to verify the accuracy or completeness of the information provided by management. Accordingly, we do not express an opinion, a conclusion, nor provide any assurance on this special purpose budgetary comparison statement.

The special purpose statement is prepared in accordance with the budgetary basis of accounting, which is a basis of accounting other than accounting principles generally accepted in the United States of America. This report is intended for the information of the Board of Directors of the Authority.

Management has elected to omit substantially all of the note disclosures required by accounting principles generally accepted in the United States of America in these interim financial statements.

We are not independent with respect to the Authority because we performed certain accounting services that impaired our independence.

Maher Accountancy
San Rafael, CA
April 29, 2025
1101 Fifth Avenue, Suite 200 San Rafael, CA 94901 415 459 1249 mahercpa.com

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Actual Budget Amount % Actual Budget Amount % Budget
Annual Budget
Less Actual
YTD

REVENUES AND OTHER SOURCES
Electricity sales, net $ 51,928,965 $ 59,416,257 $ (7,487,292) -13% $ 291,614,974 $ 332,229,431 $ (40,614,457) -12% $ 745,962,356 $ 454,347,382 Revenue for damages - - - na 8,101,745 - 8,101,745 n/a - (8,101,745) Interest and investment returns 865,883 583,333 282,550 48% 5,471,853 3,499,998 1,971,855 56% 7,000,000 1,528,147 Other income 6,166 5,700 466 8% 44,540 34,200 10,340 30% 68,400 23,860 Total revenues and other sources 52,801,014 60,005,290 (7,204,276) -12% 305,233,112 335,763,629 (30,530,517) -9% 753,030,756 447,797,644 EXPENDITURES AND OTHER USESCurrent Expenditures
Cost of energy 46,988,189 37,494,162 (9,494,027) -25% 222,141,111 262,091,856 39,950,745 15% 665,267,116 443,126,005 Salaries and benefits 878,095 1,048,820 170,725 16% 4,660,195 6,292,921 1,632,726 26% 12,585,842 7,925,647 Services and supplies 2,975,304 2,931,483 (43,821) -1% 11,730,514 17,588,896 5,858,382 33% 35,177,798 23,447,284 Capital outlay 176,579 1,443,167 1,266,588 88% 2,899,099 8,659,000 5,759,901 67% 17,318,000 14,418,901 Total current expenditures 51,018,167 42,917,632 (8,100,535) -19% 241,430,919 294,632,673 53,201,754 18% 730,348,756 488,917,837 Surplus (deficit) $ 1,782,847 $ 17,087,658 $ (15,304,811) $ 63,802,193 $ 41,130,956 $ 22,671,237 $ 22,682,000 $ (41,120,193) Annual

CENTRAL COAST COMMUNITY ENERGY

BUDGETARY COMPARISON SCHEDULE
One Month and Six Months Ended March 31, 2025
Month
Variance
Favorable
(unfavorable)
Year-To-Date
Variance
Favorable
(unfavorable)

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CCA Program surplus/(deficit)
per budgetary comparison schedule: $ 63,802,193
Adjustments needed to reconcile to the changes in net position in the Statement of Revenues, Expenses and Changes in Net Position:

Add back GASB 87 lease amortization not in operating budget 159,438 Subtract depreciation expense (298,492)
Add back capital asset acquisitions 2,899,099
Change in Net Position $ 66,562,238

REVENUES, EXPENSES AND CHANGES IN NET POSITION

CENTRAL COAST COMMUNITY ENERGY

BUDGET RECONCILIATION TO STATEMENT OF
Six Months Ended March 31, 2025

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Budget Item YTD Variance Comment
Electric Sales Revenue (12.3%) Sales revenue includes revenues actually billed to customers as well as estimated customer usage during the reporting period that is not yet billed.

Cost of Energy (15.2%) Variances in this category are typically due to (1) timing difference between projected and actual REC deliveries, (2) variance from actual to anticipated market prices, and (3) variance from actual to expected volume used by customers. Cost of energy includes scheduling coordinator fees for budget purposes only.

Staffing (25.9%) Staffing expenses are under budget due to the timing of new hires.

Professional Services (26.7%) This category includes accounting, IT, technical and other consultants.

Legal Costs (45.8%) This category includes outside legal costs for regulatory and energy procurement needs.

Marketing and customer enrollment (29.2%) Variance is mostly due to the lower than anticipated costs of recent customer enrollments.

Data Management Services (1.8%) These fees non-discretionary and are charged on a per customer basis.

Utility Service Fees (14.2%) These are PG&E and SCE fees charged on a per customer basis.

Other General & Administrative (64.6%) This category includes occupancy costs, industry membership dues, and other general and administrative costs.

Energy and Related Programs (34.5%) Programs expenses have generally been delayed until future periods Budget Commentary for significant items

CENTRAL COAST COMMUNITY ENERGY
October 1, 2024 through March 31, 2025

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Return of Investments YTD Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep CASH AND CASH EQUIVALENTSRiver City Bank/ Chase - Money Market and other Interest Earning AccountsFunds Invested - Average Balance 99,664,821$ 114,669,913$ 87,375,820$ 86,192,993$ 97,066,887$ 102,454,815$ Gains/Losses/Interest 2,135,239$ 380,768$ 421,162$ 324,104.99 317,642.68 320,213.20 371,348.25 Average APY 4.58% 4.41% 4.45% 4.42% 3.96% 4.35%INVESTMENTSSchwab/FidelityFunds Invested - Average Balance 125,703,797$ 126,158,519$ 126,652,212$ 127,096,361$ 127,561,770$ 127,989,614$ Gains/Losses/Interest 2,749,996$ 451,482.54 308,267.24 504,316.11 576,572.23 414,554.41 494,803.49 Average APY 4.31% 2.93% 4.78% 5.44% 3.90% 4.64%

CENTRAL COAST COMMUNITY ENERGY
Investment Summary
October 1, 2024 through March 31, 2025

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Current 0 - 30 Days 31 - 60 Days 61 - 90 Days > 91 Days A/R Balance $ 25,272,898 $ 14,637,818 $ 3,224,261 $ 983,597 $ 5,476,712 $ 49,595,286

CENTRAL COAST COMMUNITY ENERGY
Summary of Accounts Receivable, Net of Bad Debt Allowance As of March 31, 2025

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Staff Report Item 6
TO: 3CE Policy Board of Directors
FROM: Robert M. Shaw, Chief Executive Officer
PREPARED BY: Thomas White, Accountant
SUBJECT: Investment Performance Report for the period of October 1, 2024, through March 31, 2025
DATE: June 18, 2025
RECOMMENDATION:

Receive the 3CE investment performance report for the period of October 1, 2024, through March 31, 2025.

BACKGROUND:

As of March 31, 2025, Central Coast Community Energy held $236.5 million across its operating and investment accounts. The agency’s investment strategy remains conservative and compliant with the Investment Policy and the California Government Code, prioritizing liquidity, preservation of capital, and a passive investment approach. The portfolio's structure is designed to support day-to-day operating needs, meet collateral calls, and maintain reserves for strategic and rate stabilization purposes.

DISCUSSION/ANALYSIS:
3CE ended the quarter on March 31, 2025, with investment holdings that followed the Investment Policy and the strategy of holding enough cash to meet operating costs, including counterparty collateral calls.

The strategy consists of holding three different classes of funds: cash to meet ongoing operating costs, liquidity reserves to meet collateral calls and unforeseen costs, and short-term investments to meet reserves, including the strategic reserve and energy rate stabilization funds. As of March 31, 2025, 3CE held $236.5 million in operating and investment accounts. The table below lists the cash and investment balances by account type.

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Cash and Investment Mix Holdings by Institution
Account Type Institution Balance Investment Mix
Operating
River City Bank $99,368,035
Cash (sweep) - $82.0M
money market - $12.0M
cash (operating) - $5.0M
Chase 9,194,678 cash (held for collaterals)
Investment
Schwab 63,343,062 Treasuries - $63.3M
cash (sweep) - $0.1M
Fidelity 64,610,295 Treasuries - $63.7M
money market - $0.9M
Total $236,516,070
The investment strategy is passive, where fixed-income holdings such as Treasury notes and bills are held to maturity, and 3CE receives the coupon income and discount. As of March 31, 2025, 3CE served as investment manager of the $128.0 million held in the Schwab and Fidelity brokerage accounts. The average annual percentage yield for Treasuries ranged from 3.75% to 4.50% over the first quarter.

Treasuries with a maturity date of less than one calendar year accounted for 87% of holdings. Three Treasuries with a combined market value of $17.1 million have a maturity date in Q3 of 2026. All investment holdings managed are high-grade rated investments or higher. 3CE’s investment mix aligns with the Investment Policy and California Government Code. As of March 31, 2025, 3CE held $96.6 million in cash and cash equivalents, $127.0 million in U.S. Treasuries, and $12.9 million in money market funds. Aside from money market funds, all other investment types do not have state investment limits. The State code limits money market funds to 20% of the portfolio. 3CE is within the State limit at 5.5%.

Cash and Investment Mix Holdings
Type Market Value
% of
Portfolio
Permitted by
CA Government Code
Cash and cash equivalents $96,527,184 40.8% 100%
Money Market Funds 12,988,196 5.5% 20%
U.S. Treasuries 127,000,690 53.7% 100%
Total $236,516,070 100.0%
The FY 2024-25 Adopted Budget, with appropriations of $730.3 million, included estimated investment revenues of $7.0 million. In the second quarter, investment earnings from operating and investment accounts netted $4.9 million, $2.7 million from interest on cash and money market accounts, and $2.1 million from short-term investments, mostly from Treasuries. Interest earned on 3CE collateral held by counterparties is estimated at $586,620. To date, the total investment and interest earnings are $5.5

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million. Revenue from interest and investment earnings is estimated to total $10.8 million based on current market yields.

As of March 31, 2025, 3CE has 121 days of cash on hand. This is based on the total cash and equivalents of $236.5 million divided by an average daily expense of $1.9 million. Total operating expenses for FY 2024-25, less depreciation, are $712.4 million.

FISCAL IMPACT:

There is no fiscal impact to receiving this report.

CONCLUSION:
3CE proactively diversified its financial institutional partners while strategically deploying cash and short-term investments to capture favorable yields, while retaining liquidity for ongoing operating costs and collateral calls.

ATTACHMENT(S):

None.

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Staff Report Item 7
TO: 3CE Policy Board of Directors
FROM: Robert M. Shaw, Chief Executive Officer
PREPARED BY: Inaara Muhammad, Manager of Energy Programs SUBJECT: Energy Programs Update
DATE: June 18, 2025
RECOMMENDATION:

Receive an update on 3CE’s Energy Programs.

BACKGROUND:
3CE’s Energy Programs have been administered since 2019 to support 3CE’s mission by serving the Central Coast community with incentives to engage in electrification initiatives, strengthen the local economy, and reduce greenhouse gas emissions. The Energy Programs portfolio has undergone several iterations to improve community-wide accessibility and achieve parity for priority communities.

Currently, 3CE offers 11 programs and two pilots to support residential, commercial, and public agency electrification efforts in the transportation, building, and agricultural sectors.

DISCUSSION/ANALYSIS:

As part of 3CE’s commitment to customers, 3CE staff continually evaluate Energy Programs’ performance by tracking several key indicators and using this analysis to improve the impact of 3CE’s Energy Programs.

The second quarter of FY 2024-25 included increased participation in 3CE's Energy Programs and led to 31% more incentives distributed than during the first half of FY 2023-24. This is in part due to the enrollment of new customers in Atascadero and SLO county, increased uptake in building electrification opportunities by underserved communities, and new member agencies engaging in electrification planning. The Energy Programs Update for Q2 FY 2024-25 (Attachment 1) highlights the agency’s programs’ impact through the second quarter.

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3CE’s Energy Programs Portfolio Analysis Update (Attachment 2) provides a more detailed look at individual Energy Programs in FY 2024-25, showing data collected through April 2025. The update shares a variety of program performance metrics, including equipment-incentivized, housing units electrified, dollars spent, and performance on equity (e.g., incentives and support for income-qualified customers.) The update also describes strategic initiatives currently underway to enhance 3CE’s Energy Programs portfolio through pilots and new program offerings. Below are several on-going strategic initiatives across Energy Programs’ focus areas.

Transportation Electrification
3CE’s EV Charger Asset Pilot at the San Luis Obispo office has entered the construction phase, including ADA ramp upgrades, and the installation of pedestals and EV chargers.

The project was highlighted at 3CE’s community open house event held on March 19, 2025. Final construction includes fire system upgrades and the energization of chargers.

Full commissioning and operational readiness are scheduled for Q3 2025.

Building Electrification
On April 10th and 17th, 3CE hosted its second round of community workshops to gather public feedback on the next iteration of the Electrify Your Home program. The sessions, held in Watsonville and Goleta, were focused on outreach, education, and communication strategies. Attendees received a presentation from staff, participated in group exercises, and provided recommendations through a poster walk, and evaluation forms. Community input will help shape the program’s new design, improve outreach materials, and customer education opportunities.

Ag Electrification
3CE is reaching out to eligible customers for its Hourly Flex Pricing Pilot (HFPP), which provides customer savings and operational benefits through real-time, dynamic price signals. Eligible agricultural customers are offered automated control of equipment.

Three agricultural customers have registered for the HFP Expanded Pilot 1. 3CE is also actively enrolling residential and commercial customers in the HFP Expanded Pilot 2. 3CE currently has four residential customers and 12 commercial customers enrolled in HFP 2.

Demand Response
The Residential Battery Rebate Program introduced a new scheduling assistance service to help customers program their battery systems to discharge during peak hours. So far in FY 2024-25, 3CE has received 259 applications for the program. Since launching the program in the fourth quarter of FY 2023-24, 3CE has distributed $506,500 in rebates to customers, with approximately 743 kWh of load shifted daily during the peak period of 4 pm to 9 pm.

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FISCAL IMPACT:

There is no fiscal impact associated with this report and update.

CONCLUSION:
3CE’s Energy Programs support California’s Central Coast communities by providing funding and services to accelerate regional electrification, reduce greenhouse gas emissions, and benefit local customers and economies.

ATTACHMENT(S):

1. Energy Programs Update for Q2 FY 2024-25

2. 3CE Energy Programs Portfolio Analysis Update

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diesel buses off the
road with support
of E-bus program
5 Energy Programs Updates
2025 Q2
We serve our Central Coast community by providing reliable, affordable, clean electricity and electrification programs to reduce greenhouse gas emissions and strengthen our local economy.

Over 1,189 MT CO2e avoided as of MARCH 2025
Plan Your Fleet Charge & Electrify Your Fleet
Reach Codes
*calculated using EPA and CARB reference data
gas cars off the
road with support
of Electrify Your
Ride
• City of Atascadero
• City of Capitola
• City of Carmel
• City of Guadalupe
• City of Monterey
• City of Salinas
• City of San Luis Obispo
• City of Soledad
• County of Santa Barbara
City of Goleta - New Construction (complete)
City of San Luis Obispo - Existing Buildings Multifamily (underway) City of Santa Cruz - Existing Buildings (underway)
City of Santa Maria.............................2 EVs
City of San Luis Obispo.....................8 L2s
County of Santa Barbara .................. 60 L2s
ag equipment
transitioned to electric
alternatives with
support of Agricltural 270 Electrification Program
9 School District in San Juan Bautista
$75,168
E-bus Program
Single Family Disaster Rebuild
in Santa Cruz
$15,000
New Construction Elec. Program
14kW battery in Paso Robles
$4,200
Residential Battery Rebate Program
247 196

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3CE’s Energy Programs Portfolio Update
This report provides an update on participation in Central Coast Community Energy’s (3CE) Energy Programs Portfolio with data collected through April 2025.

TRANSPORTATION ELECTRIFICATION
Electrify Your Ride Program
3CE’s Electrify Your Ride (EYR) program incentivizes residential and commercial electrification through rebates for the purchase or lease of an electric vehicle (EV), for purchase of Level 2 and Direct Current Fast Chargers, and for electrical work necessary to install chargers. In addition, EYR provides technical assistance for EV infrastructure build-out at publicly accessible commercial sites and at multifamily residential properties. The FY 2024-25 budget for EYR is $4.1 million.

Incentives are available on a first-come, first-served basis until funding is fully awarded. To promote greater adoption of transportation electrification in disadvantaged and low-income communities, higher incentive amounts are available for income-qualified customers and multifamily-unit buildings.

In FY 2024-25, 3CE has distributed over $2,171,000 in EYR rebates across five counties, supporting over $25 million in EV and EV charger purchases. The EV purchases have resulted in over 2,349 MT CO2e avoided, which is equivalent to removing 548 gas cars off the road for one year.

Figure 1 (above): EYR funds distributed by county in FY 2024-25.

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Figure 2 (above): EYR funds distributed by incentive type in FY 2024-25.

Figure 3 (above): EYR funds distributed to income-qualified applicants in FY 2024-25.

Tier 1 = 201 - 400% FPL; Tier 2 = < 200% FPL; Standard = Non-Income Qualified Applicants Electric Bus Program
3CE’s Electric Bus program provides public schools/school districts, farmworker transit organizations, and public transit agencies enrolled in 3CE service the opportunity to receive incentives to support the purchase of up to five all-electric buses. The FY 2024-25 budget for the Electric Bus program is $1.4 million.

Applications are accepted until funds are fully distributed. Applicants are encouraged to apply for rebates following the purchase and delivery of an electric bus. Notices of Qualification (NOQ) may be requested to assure applicants of their eligibility status. Program recipients may elect for funds to be distributed directly from 3CE to the bus manufacturer upon receipt of the final invoice. Applicants are encouraged to stack/leverage other incentive funds, and no matching fund restrictions apply.

To date, 3CE has distributed $580,978 in rebates for four electric school buses and one electric shuttle van in four counties. These rebates have helped enable over $2.1M in electric bus purchases. 3CE staff

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continue to actively engage with the community to promote the program to interested schools, organizations, and transit authorities.

County Applicant
Type
Total
Funding
Total # of
E-Buses
% of Funding to Title 1 School or
Low-Income Community
Monterey 1 School District $200,000 1 100%
San Benito 1 School District $75,167.98 1 0%
San Luis Obispo N/A - - -
Santa Barbara 1 School District $62,555.17 1 100%
Santa Cruz 2 School Districts $243,254 2 0%
TOTAL: 5 School Districts $580,978 5 50%
Table 1 (above): FY 2-24-25 Electric Bus Program projects.

Plan Your Fleet Program
3CE’s Plan Your Fleet (PYF) program provides planning, design, and engineering consulting to Member Agencies to accelerate fleet electrification and EV charging infrastructure development across the Central Coast. The FY 2024-25 budget for Plan Your Fleet is $650,000.

The following jurisdictions have engaged with the Plan Your Fleet program so far, this fiscal year:
 City of Atascadero
 City of Capitola
 City of Carmel-by-the-sea
 City of Guadalupe
 City of Monterey
 City of Salinas
 City of San Luis Obispo
 City of Soledad
 County of Santa Barbara
Additional jurisdictions are planning to engage in the coming months and will be included in future reports as each scope is finalized.

Charge Your Fleet Program
3CE’s Charge Your Fleet (CYF) program provides rebates for the purchase and installation of Level 2 or Level 3 (DC Fast Charger) EV chargers. Member Agencies are eligible for up to $150,000 in funding support each fiscal year. 3CE’s FY 2024-25 CYF budget totals $1 million.

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In FY 2024-25, the program has incentivized 68 chargers totaling nearly $173,000 and is engaged with additional Member Agencies who are in the process of installing EV chargers, including the City of Monterey and City of Carmel-by-the-Sea. 3CE expects increased participation later in the fiscal year as Member Agencies who took part in FY 2023-24's Plan Your Fleet program implement their plans.

Member Agency Equipment Type Quantity Total Incentive
CITY OF SAN LUIS OBISPO Level 2 8 $22,884.25
COUNTY OF SANTA BARBARA Level 2 60 $150,000.00
TOTAL 68 $172,884.25
Table 2 (above): Charge Your Fleet projects awarded in FY 2024-25.

Electrify Your Fleet Program
3CE’s Electrify Your Fleet (EYF) program incentivizes Member Agencies to purchase or lease electric fleet vehicles. Applications are accepted until program funds are spent. 3CE Member Agency applicants are eligible to be awarded up to $150,000 in EYF incentives in a single program year. In FY 2024-25, 3CE has budgeted $1.1 million for EYF.

To date in FY 2024-25, 3CE has received two EYF applications. Staff are working with Member Agencies who are in the process of purchasing electric fleet vehicles including the City of Carpinteria, City of Goleta, City of San Luis Obispo, City of San Juan Batista, City of Santa Cruz, City of Santa Maria, City of Watsonville, and the County of Monterey and expects increased participation later in the fiscal years.

Member Agency Equipment Type Quantity Total Incentive
CITY OF SANTA MARIA Battery Electric Vehicle 2 $10,000.00 TOTAL 2 $10,000.00
Table 3 (above): Electrify Your Fleet projects awarded in FY 2024-25.

EV Charger Asset Pilot
The EV Charger Asset Pilot will improve access to public and workplace charging through 3CE owned and operated Level 2 EV chargers and Direct Current Fast Chargers.

Workplace charging at 3CE’s San Luis Obispo Office
On December 11, 2024, the Policy Board approved the launch of an EV Charger Asset Pilot at 3CE’s office located at 1026 Palm Street in San Luis Obispo. The project includes three Level 2 charging stations serving

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five parking spaces. These chargers will allow 3CE to evaluate employee charging behaviors and explore innovative energy management strategies, such as vehicle-to-load (V2L) functionality.

As part of the project, staff secured a grant from the San Luis Obispo County Air Pollution Control District (SLO County APCD) to cover approximately 60% of the equipment purchase and installation costs. Phase one, which included ADA upgrades and installation of pedestal and EV chargers, was successfully completed and highlighted during 3CE’s Community Open House event on March 19, 2025. Final construction, including full commissioning and operational readiness, is scheduled for completion in Q3 2025.

Picture 1 (above): Phase 1 completion of EV Chargers at 3CE’s San Luis Obispo Office Future Pilot Sites
3CE staff are exploring additional pilot projects for workplace charging at 3CE’s newly acquired Santa Cruz office, public charging in Santa Maria, and public charging in the City of Monterey. These sites, if selected, will support 3CE’s strategy to make EV charging more accessible along the Central Coast through agency-managed EV charging solutions.

BUILDING ELECTRIFICATION
Electrify Your Home Program
The Electrify Your Home (EYH) program provides incentives to contractors enrolled in the TECH Clean California (TECH) program for installation of all-electric heat pump water heating and HVAC systems in existing single and multi-family buildings. EYH reduces purchase costs to 3CE customers, incentivizing making the switch to all-electric heat pump technology. The FY 2024-25 budget for EYH is $720,000.

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Contractors enrolled in TECH are provided education and training on electrification design and specifications, heat pump installation, building science, and sales and marketing for electric heat pumps at no cost. There are currently 75 licensed contractors enrolled in the TECH program that work in 3CE’s service area.

On November 13, 2024, the Operations Board approved an amendment to 3CE’s contract with Cohen Ventures, DBA Energy Solutions, 3CE’s program administrator for Electrify Your Home. The amendment increased the not-to-exceed amount listed in the contract by $990,000 and extended the term of the agreement by eight months to allow for continued and uninterrupted services to support Electrify Your Home through the end of FY 2024-25.

On April 9th, the Operation Board authorized Amendment No. 6 to 3CE’s agreement with Energy Solutions.

The Amendment revised the scope of work to bring incentive check processing in house, reducing the total not to exceed amount by $735,000. The execution of Amendment No. 6 will provide both program stability and budgetary flexibility through the end of the fiscal year.

In FY 2024-25, the EYH program has so far distributed $1,318,630 in rebates to support the installation of 104 Heat Pump HVAC units and 297 Heat Pump Water Heater Units.

County Heat Pump HVAC
Units Installed
Heat Pump Water Heater
Units Installed
MONTEREY 32 24
SAN LUIS OBISPO 2 9
SANTA BARBARA 2 257
SANTA CRUZ 68 7
Table 4 (above): FY 2024-25 Electrify Your Home installations by county. 3CE staff are collaborating with the agency’s Community Advisory Council (CAC) to gather feedback on the current Electrify Your Home Program and potential improvements to the program’s design. As part of this initiative, the final round of community workshops took place on April 10th and 17th, focusing on education, marketing, and outreach strategies. Community feedback from the events will inform future improvements to Electrify Your Home.

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New Construction Electrification Program
The New Construction Electrification Program (NCEP) provides housing developers and homeowners incentives to build all-electric single and multifamily housing, including market- rate, affordable, farmworker, and disaster -rebuild housing types, as well as Accessory Dwelling Units (ADUs). Qualifying projects must be fully electric, including appliances for space heating, water heating, and cooking. The FY 2024-25 budget for NCEP is $1.0 million.

In FY 2024-25, the program has so far distributed $634,500 across four counties to support construction of 220 all-electric units.
3CE County
Market-Rate
Housing
Affordable
Housing
Accessory Dwelling
Units (ADUs)
Disaster
Rebuilds
Total Units
Incentivized
MONTEREY - - 2 - 2

SAN BENITO - - - - -

SAN LUIS
OBISPO 1 25 9 - 35
SANTA
BARBARA - - 5 - 5
SANTA CRUZ - 172 3 3 178
Table 5 (above): All-electric construction supported via NCEP in FY 2024-25.

Reach Code Program
3CE’s Reach Code program launched October 1, 2022, providing local cities and counties with no-cost technical assistance to help adopt and implement reach codes, including stakeholder outreach support.

Services include presenting to key stakeholders, technical consultation, developing customized ordinances, reviewing staff presentations and reports, and developing implementation tools to help Member Agencies enforce reach codes. In FY 2024-25, 3CE budgeted $150,000 for the Reach Code program.

On April 9
th, 2025, the Operations Board approved an amendment to 3CE’s contract with TRC Engineers, 3CE’s technical support vendor for Reach Codes. The amendment increased the not-to-exceed amount listed in the contract by $385,000 and extended the term of the agreement by two years to allow for continued and uninterrupted services to support the Reach Codes program. The amendment also added additional services for code updates, and outreach to engage new member agencies with the program.

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In FY 2024-25, 3CE is so far providing Reach Code assistance to the following Member Agencies:

Member Agency Reach Code Type
City of Goleta New Construction (complete)
City of San Luis Obispo Existing Buildings (underway)
City of Santa Cruz Existing Buildings (underway)
Table 6 (above): Reach Codes participation in FY 2024-25.

AGRICULTURAL ELECTRIFICATION
Agricultural Electrification Program
3CE’s Agricultural (Ag) Electrification program provides rebates to agricultural customers for replacing fossil fuel powered equipment with electric powered alternatives including farm tools, irrigation pumps, vehicles, and more. Enhanced incentives are available for small businesses and for businesses replacing equipment damaged or destroyed by a declared natural disaster. The program also offers technical assistance for EV infrastructure buildout at agricultural customer sites. The FY 2024-25 budget for the Ag Electrification Program is $800,000.

Rebates for equipment with higher estimated GHG emissions avoidance and those benefiting small to medium sized agricultural businesses are supported with greater incentive levels. 3CE covers up to 50% of the cost for ag equipment, providing:
 Tier 1: Up to $15,000 for lower cost and GHG avoidance projects; and  Tier 2: Up to $75,000 for larger relative cost and GHG avoidance projects.

Program funds are offered as a post-purchase rebate, with up to two rebates per customer per fiscal year.

In FY 2024-25, 3CE has so far distributed $461,062 in rebates to support twelve equipment purchases.

These rebates have helped enable over $1M in all-electric agricultural equipment. 100% of incentives distributed in FY 2024-25 have been to 3CE’s small businesses customers.

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County Equipment
Incentivized
Total
Incentives
% Incentives to
Small Businesses
Monterey 2 Standard tractors
1 Irrigation pump $108,608 100%
San Benito 1 Standard tractor
1 Forklift $58,095 100%
San Luis
Obispo - - -
Santa
Barbara
2 Standard tractors
1 Excavator $157,908 100%
Santa Cruz
2 Standard tractors
1 Compact tractor
1 Excavator
$136,451 100%
Total: 12 All-electric equipment $461,062 100%
Table 7 (above): Agricultural electrification projects awarded in FY 2024-25.

DEMAND RESPONSE / LOAD MANAGEMENT
Residential Battery Rebate Program
3CE’s Residential Battery Rebate program launched on July 16, 2024, to promote the use of residential behind-the-meter battery storage systems. Rebates are provided for the purchase of eligible batteries, qualifying installation hardware, and labor directly related to the battery system's installation. 3CE has set a goal of issuing four hundred rebates per fiscal year, which equates to approximately 2.6 megawatts (MW) of load shifted, and an annual expenditure of $2M.

The program offers a $300 per kilowatt hour (kWh) rebate for customers. A $500 per kilowatt hour (kWh) rebate is offered to Net Energy Metering (NEM) 1.0 and NEM 2.0 customers who elect to transition to the Solar Billing Plan (SBP), also known as the Net Billing Tariff (NBT), early. Additionally, the program offers a $500 per kilowatt hour (kWh) rebate for customers who are enrolled in the Medical Baseline program and rely on electricity to power medical devices. To promote adoption in disadvantaged and low-income communities, the program offers a $500 per kilowatt hour (kWh) rebate for customers enrolled in CARE or FERA payment assistance programs.

In February 2025, staff introduced a new scheduling assistance service to help customers meet the program’s requirements by setting their battery systems to discharge during the peak hours of 4 pm to 9 pm. Thirty-eight customers have since signed up to receive assistance and have successfully met discharge requirements. Staff are conducting direct outreach to rebate applicants to facilitate their enrollment.

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In FY 2024-25, 3CE has so far received 259 applications for the program. Since launching the program in the fourth quarter of FY 2023-24, 3CE has distributed $506,500 in rebates to customers, with approximately 743 kWh of load shifted daily during peak hours.

Figure 4 (above): kWh of load shifted daily during the peak period of 4 pm to 9 pm by month.

Hourly Flex Pricing Pilots 1 and 2
3CE is reaching out to eligible customers for the Hourly Flex Pricing Pilots (HFPP), which provides customer savings and operational benefits through real-time, dynamic price signals. The pilots offer eligible agricultural, commercial, and residential customers a way to lower their energy costs by locking into hourly, market-based energy prices, forecasted up to one week in advance. The pricing provides an opportunity for participants to shift energy use to lower priced hours. Participants are charged monthly at their normal rate; however, a monthly “performance bill” based on the hourly rates is issued and at the end of each 12-month period, with any total cost savings achieved through hourly price-based load shifting paid to the customer by 3CE check.

The Hourly Flex Pricing Expanded Pilot 1 is for agricultural customers and includes the option to receive a one-time rebate for purchasing automation technology and software that responds to price signals, such as a smart controller for an irrigation pump. The HFP Expanded Pilot 2 is for commercial and residential customers. All customer classes have access to Automation Service Providers (ASPs) to help manage load shifting and optimize cost savings.

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To date, 3CE has 20 customers enrolled in HFPP. Total enrolled load from these customers is nearly 8 GWh; approximately 50% of 3CE’s internal load enrollment goals for the pilot.

Pilot Customers Enrolled Total Enrolled Load
HFP Expanded Pilot 1 (Agricultural) 3 4.03 GWh
HFP Expanded Pilot 2 (Commercial) 12 3.86 GWh
HFP Expanded Pilot 2 (Residential) 4 51.3 kWh
TOTAL 20 7.89 GWh
Table 8 (above): 3CE customers enrolled in Hourly Flex Pricing Pilot

OTHER STRATEGIC INITIATIVES
Customer Relationship Management System
The new Customer Relationship Management (CRM) tool for program management and applications was successfully launched on October 1st, 2024. Existing program applications were kept open during the transition from FY 2023-24 to the current fiscal year. Additional usability features are under development.

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Staff Report Item 8
TO: 3CE Policy Board of Directors
FROM: Robert M. Shaw, Chief Executive Officer
PREPARED BY: Jerri Strickland, Director of Regulatory Affairs & Compliance Das Williams, Senior Advisor of Policy and Legislative Affairs Kalia Mitchell-Silbaugh, Policy Advisor
Robert Wool, Policy Advisor
SUBJECT: Regulatory and Legislative Quarterly Update
DATE: June 18, 2025
RECOMMENDATION:

This memorandum provides the Policy Board with a second quarter Regulatory & Legislative Update.

DISCUSSION:

The Regulatory and Legislative Quarterly Updates prepare a summary of key proceedings and policy matters impacting 3CE’s customers, business operations, and climate goals.

FISCAL IMPACT:

There is no financial impact associated with receiving this report.

ATTACHMENT(S):

1. Quarterly Regulatory and Legislative Update

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Quarterly Regulatory & Legislative Update
June 18, 2025

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Table of Contents
REGULATORY UPDATE ..................................................................................................................................3 Resource Adequacy (RA) -.........................................................................................................................3 Provider of Last Resort (POLR) and Emergency Transition Planning –.....................................................3 Demand Flexibility –..................................................................................................................................4 Preventing Disconnections - R.18-07-005.................................................................................................5 Bioenergy Market Adjustment Tariff (BioMAT) - R.22-10-010 ................................................................5 New Power Charge Indifference Adjustment (PCIA) Rulemaking –..........................................................6 Integrated Resource Planning (IRP) -........................................................................................................7 Demand and Distributed Energy Market Integration (DDEMI) - ..............................................................7 PG&E Rule 30 Application for Transmission Service– A.24-11-007..........................................................8 Energy Resources Recovery Account (ERRA) Compliance – A.23-02-018; A.25-04-001...........................8 Energy Resources Recovery Account (ERRA) Forecast – A.25-05-011; A.25-05-008................................9 General Rate Cases — A.25-05-009........................................................................................................10 3CE LEGISLATIVE REPORT – Spring 2025.....................................................................................................10 Federal Legislative Developments: .............................................................................................................10 State Legislative Developments:.................................................................................................................11 Supported Legislation .........................................................................................................................11 Legislation of Concern.........................................................................................................................12 GLOSSARY....................................................................................................................................................13

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REGULATORY UPDATE
Resource Adequacy (RA) - R.23-10-011
Issue
The Resource Adequacy (RA) program is the California Public Utilities Commission’s (CPUC) main grid reliability planning program. All load serving entities (LSEs) under the CPUC’s jurisdiction, including CCAs, must demonstrate purchase of a specified amount of eligible RA generation capacity each month and each year to comply with RA program requirements. Increasing demand and a decreasing supply of eligible RA capacity over the past five years have resulted in sharply increased prices and unprecedented difficulty procuring sufficient RA to achieve compliance. Over the past year the CPUC has also sought to tie RA compliance to other, unrelated operations such as CCA expansion into new communities.

Status
On March 17, 3CE filed joint reply comments with San Jose Clean Energy on Track 3 proposals, focusing on party proposals related to the Planning Reserve Margin (PRM) for 2026, which is a buffer applied on top of RA procurement requirements to account for differences between actual and forecasted demand. 3CE’s comments recommended that the CPUC maintain the current 17% PRM with an additional “effective” PRM procured by the investor-owned utilities (IOUs), instead of proposals for higher requirements that could result in unnecessary procurement at significant costs to ratepayers. On May 22, the Commission issued a Proposed Decision (PD) concurring with 3CE that a lower PRM is the most prudent and reasonable approach to ensuring grid reliability while minimizing costs to ratepayers, proposing instead to a minimally increase the PRM to 18% for 2026 and 2027 and extend the effective PRM framework. Unfortunately, the PD does not adopt CalCCA’s proposal for hourly load obligation trading, despite strong stakeholder support and documented affordability benefits.

Next Steps
3CE will work with CalCCA to develop comments on the Track 3 PD, due June 11, continuing to advocate for the Commission to adopt hourly load obligation trading. The Commission will vote on the PD as early as its June 26 business meeting. If adopted, the decision will close the current RA proceeding. A future RA rulemaking will address outstanding Track 3 issues, including development of an unforced capacity (UCAP) methodology to account for historic forced outage rates of certain resources and the accreditation of long duration energy storage resources under the slice-of-day framework.

Provider of Last Resort (POLR) and Emergency Transition Planning – R.21-03-011 Issue
The Provider of Last Resort (POLR) is the backstop entity that would provide electric service to customers of a load serving entity (LSE), were that LSE to suddenly fail. This role has historically been held by the investor-owned utilities (IOUs) Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric. However, this proceeding is seeking to establish a process for the first time that would allow CCAs and other non-IOU LSEs to become POLR in their service areas. 3CE does not aim to be the POLR but wants to ensure the process is fair for all LSEs. This proceeding is also considering rules designed to prevent LSE failures that have various implications for 3CE finances and operations. This includes changes to how much money CCAs must post as insurance against their own failure (called the Financial Security Requirement, or FSR).

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Status
Party comments in Phase 2 have indicated that no non-IOU entity is currently interested in taking on the POLR role, so CalCCA has advocated that the CPUC defer decisions on granular issues until parties express interest in transferring POLR obligations. On May 28, the CPUC issued a Ruling seeking party comment on the Commission’s authority over a non-IOU entity and a potential procedural path for a non-IOU to apply for POLR status. The Ruling proposes limiting the current proceeding to determining the CPUC’s authority and addressing any non-IOU interest in serving as POLR in a future rulemaking.

Separately, on May 28, PG&E submitted a revised advice letter implementing the new FSR calculation methodology adopted in Phase 1 after CalCCA identified errors in its original advice letter.

Next Steps
3CE will work with CalCCA to submit comments on the Ruling, due June 13, continuing its advocacy for the legislatively protected autonomy of non-IOU LSEs. CalCCA and 3CE are reviewing the IOU advice letters implementing the new FSR methodology and will file a response if any further errors are identified in their calculations. 3CE’s next FSR posting is due by September 1, 2025.

Demand Flexibility – R.22-07-005
Issue
Launched in 2022, this CPUC proceeding aims to enhance demand flexibility and grid reliability in California, mitigating costs from grid stress. To promote participation in demand flexibility by both bundled and unbundled customers, the CPUC issued a Decision in 2024 to expand two dynamic rate pilot programs to CCAs. As part of 3CE’s load management standards (LMS) plan, and to gain experience with dynamic rates, 3CE elected to participate in PG&E’s expanded pilots to offer hourly flex pricing to agricultural, commercial, and residential customers. On January 31, 2025, 3CE finalized a service agreement with PG&E, enabling 3CE to enroll customers in the expanded pilot.

Status
On April 2, PG&E filed an advice letter (AL) notifying the Commission that it has surpassed 50 megawatts (MW) of enrollment in its Expanded Ag Pilot and stated that it has paused pilot enrollment to evaluate changes to support additional participants without providing any additional information on the timeline or process to reopen enrollment. This pause was unexpected. CCAs had already been once delayed in enrolling customers in the pilot by PG&E’s earlier request for a service agreement. PG&E does not have explicit authority to pause pilot enrollment on behalf of bundled and unbundled customers. Accordingly, 3CE initiated a Joint CCA effort to protest PG&E’s advice letter on April 22, arguing that PG&E’s pilot administration has hindered CCA participation and requested that PG&E submit additional details on the duration and process to reopen program enrollment. PG&E filed a supplemental AL to remove language on the enrollment pause from its original AL filing.

Next Steps
Although PG&E rescinded its language on an enrollment pause, its supplemental AL did not address all the implementation challenges raised by the Joint CCAs. 3CE reached out to the CPUC to request a meeting between the Joint CCAs and Energy Division staff. 3CE staff will treat this meeting as opportunity to advocate for the equitable treatment of unbundled customers enrolled in hourly flex pricing pilots.

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Preventing Disconnections - R.18-07-005
Issue
In 2018, The CPUC approved an Order Instituting Rulemaking (OIR) to address residential disconnection rates across California’s electric and gas Investor-Owned Utilities. The primary goal of this proceeding is to reduce residential disconnections and improve reconnection processes. In 2020, the CPUC established temporary residential disconnection rate caps for IOUs, which were initially set to expire in 2024 and have since been extended through July 1, 2025. These caps limit the number of customers the IOUs can shut off due to nonpayment. On October 30, 2024, the CPUC filed an amended Scoping Memo for Phase 2 of the proceeding, which addresses residential disconnections, arrearage management programs, and disconnection protections during extreme weather events.

Status
The CPUC issued a Phase 2 Proposed Decision on May 9, 2025. The PD requires the IOUs to refrain from disconnecting customers on their first disconnection-qualifying nonpayment event, and instead enroll them in payment plans. Such customers will additionally be protected from disconnection for three-months, after which the IOUs can set policies consistent with CPUC orders, including enrolling customers in the Arrearage Management Plan Program (AMP) or Percentage of Income Payment Plan (PIPP). The PD also adds reconnections to the list of metrics the IOUs report in their monthly disconnection reports.

Finally, the PD requires the IOUs to file proposals for heat-based disconnection thresholds within six months of the issuance of the decision and to adopt them by May 1, 2026.

Next Steps
3CE worked with CalCCA to file opening comments on May 29, 2025 on the PD, supporting its incremental approach to balancing customer disconnection protections with high arrearage amounts.

The comments also recommended approval of reconnection framework and reporting requirements in the PD, which in an effort to improve resource deployment, require the large IOUs to provide regular reports to CCAs of CCA customers who have been recently disconnected and are at risk of disconnection. The PD also requires the large IOUs to include a breakdown of the disconnection rates by bundled and unbundled customers in its monthly reports to help inform broader disconnection prevention strategies. Finally, the IOUs would be required to develop a third-party, holistic study of payment plan and disconnection protection programs to identify potential improvements. 3CE will continue to participate in the proceeding as the CPUC further considers its disconnections policies.

Bioenergy Market Adjustment Tariff (BioMAT) - R.22-10-010 Issue
BioMAT is a procurement program opened in 2015 to encourage the development of small bioenergy projects in California. The program is unique in that it allows load serving entities (LSEs) contracting with these projects to recover the costs from all California electricity users through the Public Purpose Programs (PPP) charge. In 2021, 3CE and other CCAs successfully lobbied legislators to reverse the exclusion of CCAs from BioMAT with the passage of AB 843. AB 843 was the first time CCAs gained access to PPP funding, setting a valuable policy precedent. The CPUC began implementation of AB 843 in October 2022 by opening a new proceeding to work through the details of CCA participation.

Status
On January 29, 3CE received its first BioMAT program participation request (PPR) from a category 2 agricultural bioenergy project. 3CE reviewed the project and found that it met the eligibility criteria

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required by the CPUC. The BioMAT third-party administrator, Accion, is responsible for managing the queue, determining the statewide price based on the established BioMAT pricing mechanism, and identifying projects next in line for a PPA award. On April 16, Accion issued a conditional winner notification to 3CE’s BioMAT applicant. Per the BioMAT tariff, 3CE offered an executable Power Purchase Agreement (PPA) to the BioMAT applicant on May 8.

Next Steps
3CE is currently awaiting receipt of an executed PPA from the BioMAT applicant, due June 6, and will continue to follow the PPA process and timeline set by the BioMAT tariff. 3CE’s next compliance filing to show prudent contract management for the BioMAT program is due September 1, 2025. 3CE has initiated work on this compliance filing and anticipates reaching out to CPUC staff for further guidance once its first BioMAT PPA is executed.

New Power Charge Indifference Adjustment (PCIA) Rulemaking – R.25-02-005 Issue
On February 20, the CPUC opened a new proceeding to update policies and procedures related to the IOUs’ Energy Resource Recovery Accounts (ERRA) and the Power Charge Indifference Adjustment (PCIA).

The PCIA is a fee that all customers, bundled or unbundled, pay to ensure the IOUs remain indifferent to the loss of customers when it comes to the cost of energy procurement completed before customers had a choice in their energy provider. The rulemaking will address near- and long-term changes impacting the PCIA. The PCIA is calculated with market price benchmarks (MPBs), which establish the market value of the IOUs’ PCIA-eligible portfolio. However, in recent ERRA proceedings, the IOUs have proposed new policies related to the calculation of MPBs, citing concerns with the accuracy and volatility of the current methodology. Track 1 will consider potential modifications to the MPB calculations on an expedited timeline, targeting a June 2025 decision for incorporation in 2026 ERRA forecasts.

Status
On May 23, the Commission issued a PD adopting changes to the calculation of the RA MPB, which will be utilized in the 2025 MPB true-up. The PD supports combining system, local, and flexible RA into a single RA value when calculating RA MPBs, an approach that 3CE has supported, along with eliminating data that is duplicative or does not reflect market-based transactions. The PD also agrees with CalCCA that it is important to preserve the existing mark-to-market paradigm that values the benefits of attributes at their current market prices. However, the PD finds that adopting a three-year transaction window for the annual forecast RA MPB and a four-year transaction window for the final RA MPB, balances the need for more transaction data with the mark-to-market principle. CalCCA has opposed expanding the timeframe used for MPB calculation, but the three-to-four-year window is an improved option over proposals that would include even older transaction data.

Next Steps
3CE will work with CalCCA to draft comments on the PD, due June 12, that support the Commission’s commitment to a mark-to-market approach advocating that a one-year lookback is more accurate than a 3- and 4-year timeframe. The CPUC intends to vote on the Track 1 PD on June 26. Track 2 of the proceeding will consider broader and long-term improvements to ERRA and PCIA processes, IOU rate forecasts, and mitigation of rate volatility.

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Integrated Resource Planning (IRP) - R.20-05-003
Issue
Integrated Resource Planning (IRP) is the CPUC’s greenhouse gas (GHG) reduction planning program.

LSEs must submit IRPs every two years demonstrating that planned future procurement will produce GHG emissions below an assigned benchmark while contributing to a resource fleet that meets sector-wide GHG targets and maintains grid reliability. Previous IRP cycles have produced three procurement mandates, which apply to 3CE and other CCAs. On April 18, the CPUC issued an Amended Scoping Memo stating its intent to address additional issues in the IRP proceeding, including implementation of Assembly Bill (AB) 1373 which allows the Commission to request for the Department of Water Resources (DWR) serve as a central procurement entity (CPE) for certain long-lead time (LLT) resources, and develop of a long term procurement framework entitled the Reliable and Clean Power Procurement Program (RCPPP) that would replace the CPUC’s current ad hoc mandate structure.

Status
On April 29, the CPUC issued long-awaited design proposals for the RCPPP, the new long term procurement framework intended to give LSEs a clear and predictable set of long-term reliability and greenhouse-gas (GHG) reduction procurement requirements to replace the current order-by-order approach. The proposals provide two options for reliability procurement and one option for GHG reduction procurement. Initial implementation of the RCPPP is proposed within the next two years, although penalties for deficient online sufficiency would not be assessed until 2030. The CPUC is now facilitating a robust stakeholder process, including workshops and opportunities for feedback on the RCPPP design elements. Separately on April 29, the CPUC issued a PD approving a petition for modification (PFM) submitted by the Long Duration Energy Storage (LDES) Council to clarify that requirements in the mid-term reliability (MTR) procurement orders cannot be met by derating shorter-duration batteries. This PD will not impact 3CE’s MTR compliance position. 3CE provided its position to the CPUC on June 2 as part of its regular IRP compliance filing, which shows 3CE’s progress towards the MTR procurement requirements and highlights 3CE’s ongoing efforts to bring new, clean resources online despite a challenging procurement environment.

Next Steps
3CE staff will attend the CPUC’s RCPPP workshops on June 23 and 24 and continue working with CalCCA to develop feedback on the proposals, advocating for the CPUC to prioritize feasibility, efficiency, and affordability in its RCPPP design. Comments on RCPPP are due by July 15. 3CE has also initiated work on its next IRP filing, due to the CPUC on November 1, 2025.

Demand and Distributed Energy Market Integration (DDEMI) - Initiative Issue
In January, the California Independent System Operator (CAISO) launched its new Demand and Distributed Energy Market Integration (DDEMI) initiative to explore enhancements to or development of participation models and market rules for distributed energy resources (DERs) to participate in the CAISO market. 3CE has been supportive of CAISO taking on this initiative to address barriers and inefficiencies that hinder the ability for DER to provide resource adequacy.

Status

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The CAISO held its first working group meeting on February 5 to outline the process, timeline, and initial scope of the initiative. 3CE worked with CalCCA to submit comments identifying CCAs’ primary interests in the initiative, including: (1) Ensuring that CCA DERs receive full RA credit and energy market rents for participation in the wholesale market; and (2) Addressing the need for CAISO visibility of DERs. CalCCA will also advocate for CAISO to study device-level measurement and consider solutions that would improve measurement and evaluation of specific device types such as behind-the-meter batteries.

Next Steps
The DDEMI initiative is still in early stages, as CAISO continues to scope the issues it will address in 2025.

The working group process will explore improvements to DER performance evaluation methodologies and will culminate with proposals anticipated to go before the CAISO Board of Governors in 2026. 3CE will continue to monitor the proceeding through CalCCA and advocate for improvements that benefit 3CE’s programs and customers.

PG&E Rule 30 Application for Transmission Service– A.24-11-007 Issue
On November 21, 2024, PG&E submitted an Application to the CPUC requesting approval of a new rule (Rule 30) for non-residential customers requesting interconnection at transmission-level voltages, citing a recent increase in customers, such as data centers, requesting transmission-level interconnections.

Current PG&E rules are focused on distribution-level interconnections. Under the proposed rule, the transmission-level customer would pay interconnection costs in advance of their forecasted load materializing, at which point the costs would be collected through rates. 3CE has spearheaded a joint CCA coalition to participate in the proceeding and ensure that any resulting rule change does not negatively impact competition.

Status
On March 18, the CPUC issued a Ruling seeking additional information from PG&E to assess the reasonableness of PG&E’s request for interim implementation of Rule 30. After reviewing PG&E’s answers, the Joint CCAs submitted a response to highlight the need for PG&E to share information related to planned load growth with CCAs. On May 22, 3CE, along with staff from six other CCAs, had an ex parte meeting with President Reynold’s office to emphasize that CCAs are willing and able to serve data centers and other large transmission loads and to advocate to give CCAs fair and timely access to key large load data.

Next Steps
3CE awaits a Ruling by the CPUC that will determine whether it approves PG&E’s motion for interim implementation. In the meantime, testimony on PG&E’s original application to establish the new interconnection rule is due June 30. 3CE will continue to engage with the Joint CCAs, the CPUC, and PG&E to advocate for transparency and information-sharing on planned load growth so that CCAs can make informed procurement decisions.

Energy Resources Recovery Account (ERRA) Compliance – A.23-02-018; A.25-04-001 Issue
Energy Resource Recovery Account (ERRA) compliance filings are made annually by the Investor-Owned Utilities (IOUs) for the approval of costs associated with Utility Owned Generation (UOG) operations and fuel procurement, Portfolio Allocation Balancing Account (PABA) entries, economic dispatch of electric

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Central Coast Community Energy (3CE) Policy BoardJune 18, 2025

Central Coast Community Energy (3CE) Policy Board
June 18, 2025