Memorandum
To: Energy Planning and Resources Committee
From: John McNamara, Director, Structured Contracts
Lindsay Descagnia, Vice President, Power Supply
Subject: 2025 Clean Energy and Reliability RFO
Date: July 18, 2025
2025 Clean Energy and Reliability RFO Updates
On May 20th, CPA launched the 2025 Clean Energy and Reliability Request for Offers (RFO), which included detailed instructions for submitting proposals. The RFO allowed proposals across many product categories including the following:
• Renewable Generation
• Renewable Generation Plus Storage
• Standalone Storage
• Resource Adequacy Only
• Thermal Plus Storage
Proposers in certain categories were permitted to assume a 30% Investment Tax Credit (ITC) or equivalent Production Tax Credit (PTC) and were asked to include price adjusters that would increase or reduce the contract price if the actual tax credit received by the proposer ranged between 15% and 50% ITC (or PTC equivalents).
Proposals were received on June 30.
On July 4, the 2025 Tax and Spending Bill (H.R. 1) was signed into law. The legislation significantly alters the likelihood that certain projects will obtain ITC and PTC benefits, particularly for wind and solar projects, by restricting eligibility to projects that either come online before 2028 or meet specific construction start and/or Foreign Entity of Concern (FEOC) requirements.
In response to these substantial changes in federal energy tax policy and the potential impact on the economics of the RFO proposals, CPA issued an addendum on July 11 to the RFO instructions. Key updates include:
• Proposal Resubmission: Proposers who submitted an offer by the June 30th deadline may now resubmit the proposals with refreshed pricing by July 28th.
Energy Planning & Resources Committee Memorandum
• Benchmark Tax Credit Level: For product categories that allow tax credit price adjusters, proposers must now identify a benchmark ITC or PTC level they are assuming.
• Tax Credit Price Adjusters: Proposers may only include tax credit price reducers.
These become effective if they receive a tax credit greater than their proposed benchmark. Proposers may no longer include price increases if the tax credit they receive is lower than the Benchmark Tax Credit Level. • Contract Term Updates: Proposers may revise their contract start and end dates, provided they remain within the RFO’s eligibility criteria. • Additional Information: Proposers must answer supplemental questions to help CPA assess the likelihood of tax credit eligibility.
As a result of these changes, the RFO longlist results presentation will be delayed and is now scheduled for the August Energy Planning and Resource Committee meeting instead of the July meeting. Staff does not expect the overall timeline of the RFO to be delayed and plans to hold a Review Team meeting in mid-September. The shortlist recommendation is expected to be presented at the September Energy Planning and Resource Committee.
Initial 2025 Clean Energy and Reliability RFO Submissions The table below summarizes the number and types of proposals submitted by the original RFO deadline. Please note that these figures are subject to change as proposal eligibility is assessed and as proposers decide whether to submit refreshed offers by the July 28th deadline.
Product Category
Total
Offers
Received
Technology
Standalone Storage 61 Battery Energy Storage System (BESS) Renewable Generation 8 Solar/Wind
Renewable Generation +
Storage 25 Solar + BESS
Resource Adequacy Only 18 Thermal/BESS/Solar
Thermal + Storage 5 Dispatchable Natural Gas + Storage
Totals 117