June 2025 Risk Management Team Report
To: Finance Committee
From: Lyon Hardgrave, Director, Energy Risk Management
Approved By: Ted Bardacke, Chief Executive Officer
David McNeil, Chief Financial Officer
Subject: Receive and File June 2025 Risk Management Team Report Date: July 23, 2025
June 2025 RMT REPORT
Key Actions
• Reviewed the counterparty credit exposure summary
• Reviewed March 2025 day-ahead load forecast performance • Reviewed May 2025 market performance
• Reviewed energy positions and approved 2025-2029 hedge proposal for monthly RFO
• Reviewed 2024 - 2030 Renewable and Carbon-Free positions • Reviewed 2025 – 2027 PCC1 sales strategy
• Reviewed the 2025-2027 slice of day RA position
• Reviewed 2025 RA purchase and sale strategy
• Reviewed Energy Risk Management Policy (ERMP) compliance for RA, REC, CF, and Energy
• Reviewed long-term energy contract amendments and terminations • Reviewed June 2025 CRR Allocations
• Reviewed the Negative REC Price strategy
Finance Committee Item {{item.number}}
Policy Compliance
Policy Deviation Required Action
Beginning in June 2024, the renewable
energy hedge percentage exceeded
the maximum hedge percentage for
2027 due to the addition of new
renewable energy supply from a PPA.
Beginning in November 2024, the
renewable energy hedge percentage
exceeded the maximum hedge
percentage for 2028-2030 due to a
reduction in the renewable energy
product targets that are used for long-term power planning and position management.
None.
The deviations for 2027-2030 will resolve
themselves as these years draw nearer and the
maximum hedge percentages increase.
ATTACHMENT
None.
Clean Power Alliance Investment Report
May 2025
(in USD unless otherwise noted)
Local Agency
Investment
Fund (LAIF)
Certificates of Deposit
(CDs)
California Asset
Management Program
(CAMP)
US Bank Custodial
Account
US Treasury Securities Total
Beginning Balance 17,364 70,000,000 237,689,677 2,266,392 108,737,532 418,710,964 Deposits & Purchases 0 0 810,635 40,046,788 40,046,738 80,904,160 Maturities & Withdrawals 0 0 40,000,000 39,999,211 0 79,999,211 Ending Balance 17,364 70,000,000 198,500,311 2,313,968 148,784,270 419,615,914 Interest Earned* 62 259,678 810,635 46,788 355,071 1,472,233 Yield** 4.27% 4.30% 4.42% 4.20% 2.91% 3.84%
Weighted Average Term to Maturity (Months) 7.0 6.6 2.0 1.0 55.0 21.5 **Yield for LAIF & CAMP is reported on a monthly average basis; yield for CDs is determined based on a weighted average annual basis; yield for US Treasuries is equivalent to the coupon rate divided by month-end bond price; total yield is the weighted average yield for the whole portfolio Transaction Type Deposit
Depository US Bank National Trust
Par Amount 47,148,000
Coupon Rate 0.625%
Placement Date 5/19/2025
Maturity Date 5/15/2030
Term (months) 60
Estimated Interest Earnings (Total) 8,622,164
* Interest earned on LAIF is based on daily compounding, account balances and monthly effective yield published by LAIF. Interest earned on CDs is based on the fixed interest rate of each CD and is paid out in full at maturity. Interest earned on UST is based on the yield of each UST and is paid out at maturity (for terms <6mo) or biannually (for terms >6mo) Summary of Transactions (US Treasury Securities)
CUSTOMERS
Summary of Financial Results
Definitions:
Accounts: Active Accounts represents customer accounts of active customers served by CPA per Calpine Invoice Participation Rate %: Participation Rate represents active accounts divided by eligible CPA accounts YTD Sales Volume: Year-to-date sales volume represents the amount of energy (in gigawatt hours) sold to retail customers Revenues: Retail energy sales and other (grant related) revenues less allowance for doubtful accounts Cost of energy: Includes all direct power costs incurred to serve CPA’s load Operating expenses: Includes general, administrative, consulting, payroll, and other costs required to fund operations Operating Income: Represents the difference between revenues and cost of energy and operating expenses Non-Operating Income: Interest income arising from deposits and investments net of borrowing costs and fees Investments: Liquid and high-quality securities with maturities of 91 days or more Cash and Cash Equivalents: Includes bank deposits and high quality and liquid securities with maturities of 90 days or less Year to date (YTD): Represents the fiscal period beginning July 1, 2024 YTD
May
2025
Financial Dashboard
Note: Numbers may not sum up due to rounding.
Active Accounts
1,039,312
Participation Rate
92.8%
YTD Sales Volume
9,771 GWh
May Volume
826 GWh
Agr/Oth
2% Com-Lg
22%
Com-Sm
31%
Res
45%
In May 2025, CPA’s net position increased by $20.4 million, $9.0 million or 30% less than the budgeted increase in net position of $29.4 million for the month. May 2025 revenues were $19.4 million less than budgeted as a result of CPA’s interim rate reduction which was approved by the Board in February 2025 and took effect in March 2025. Lower than budgeted revenue was offset by energy costs that were $8.0 million below budget, operating expenses that were $1.3 million below budget and interest income that was $1.1 million above budget.
Year-to-date, CPA’s net position increased by $124.0 million, $42.3 million or 52% higher than the budgeted increase of $81.6 million. YTD revenues were $1.35 billion, $101.3 million or 7% less than budgeted primarily due to CPA’s rate reduction taking effect on March 1st. YTD energy cost was $1.20 billion, $117 million or 9% less than budgeted primarily due to the non-utilization of contingencies and lower than budgeted energy costs. Absent contingencies, energy costs YTD were $39.2 million or 3.2% less than budgeted. Operating expenses were $45.5 million YTD, $16 million or 26% less than budgeted primarily due to lower than budgeted spending on customer programs, professional services, communications, and administrative expenses. Non-operating income, primarily made up of interest income, was $19.2 million YTD, $10.9 million or 132% higher than budgeted.
As of May 31st, 2025, CPA had unrestricted cash, cash equivalents, and investments of $385.2 million, and $114.4 million available in its bank line of credit representing 178 Days Liquidity on Hand. CPA is financially sound and in compliance with its bank and other credit covenants.