Executive Committee of the
Clean Power Alliance of Southern California
Regular Meeting
Thursday, February 19, 2026
1:30 p.m.
Visit CPA’s YouTube Channel to view a Live Stream of the Meeting www.youtube.com/@CPApublicmeetings
*There may be a streaming delay of up to 90 seconds. This is a view-only live stream.
Clean Power Alliance
Executive Conference Room
801 S. Grand Ave., Suite 400
Los Angeles, CA 90017
Members of the public may also participate in this meeting remotely at the following locations:
Agoura Hills City Hall
Planning Conference Room
30001 Ladyface Court
Agoura Hills, CA 91301
Ventura County Government Center
CEO Point Mugu Room
Hall of Administration
800 South Victoria Avenue
Ventura, CA 93009
Alhambra City Hall
Conference Room
111 S. First St.
Alhambra, CA 91801
Camarillo City Hall
Council Office
601 Carmen Drive
Camarillo, CA 93010
Carson City Hall
Executive Conference Room
701 East Carson Street
Carson, CA 90745
Hawthorne City Hall
Administrative Office
4455 W. 126th Street
Hawthorne, CA 90250
Los Angeles County Hall of Administration
Sybil Brand Conference Room, Room 372
500 West Temple Street
Los Angeles, CA 90012
Santa Paula City Hall
Councilmember Office
970 E. Ventura Street
Santa Paula, CA 93060
Beverly Hills City Hall
Council Office, 4th Floor
455 N. Rexford Drive
Beverly Hills, CA 90210
Holiday Inn Express & Suites
15586 County Road B
Hayward, WI 54843
PUBLIC COMMENT: Members of the public may submit their comments by one of the following options:
• Email Public Comment: Members of the public are encouraged to submit written comments on any agenda item to [email protected] up to four hours before the meeting. Written public comments will be announced at the meeting and become part of the meeting record. Public comments received in writing will not be read aloud at the meeting. • Provide Public Comment During the Meeting: The General Public Comment item is reserved for persons wishing to address the Committee on any Clean Power Alliance-related matters not on Agenda Page 1
today’s agenda. Public comments on matters on today’s Consent Agenda and Regular Agenda shall be heard at the time the matter is called. Comments on items on the Consent Agenda are consolidated into one public comment period. Members of the public who wish to address the Committee at CPA’s Office are requested to complete a comment card and provide it to staff. If you are attending from a remote location, please identify yourself to a CPA representative when your item is called. Each speaker is limited to two (2) minutes (in whole-minute increments) per agenda item with a cumulative total of five 5 minutes to be allocated between the General Public Comment, the entire Consent Agenda, or individual items in the Regular Agenda. Please refer to Policy No. 8 – Public Comment for additional information.
NAVIGATING OUR AGENDA PACKETS
The meeting agenda packets are bookmarked PDFs, which display a list of agenda items to the left of the page and allow you to click to view specific items within the packet. If viewing in your browser, click the "document outline" button in the upper left corner of the screen. If the PDF is downloaded, the bookmark panel (ribbon icon) appears on the left side of the screen.
ACCESSIBILITY: Meetings are accessible to people with disabilities. Individuals who need special assistance or a disability-related modification or accommodation to participate in this meeting, or who have a disability and wish to request an alternative format for the meeting materials, should contact the Clerk of the Board at least two (2) working days before the meeting at [email protected] or (213) 713- 5995. Notification in advance of the meeting, while not required, will enable us to make reasonable arrangements to ensure accessibility to this meeting and the materials related to it.
CALL TO ORDER AND ROLL CALL
GENERAL PUBLIC COMMENT
CONSENT AGENDA
1. Approve Minutes from January 15, 2026, Executive Committee Meeting
REGULAR AGENDA
2. Oral Update from the CEO on CPA Operations
3. Review Draft Agenda for the March 5, 2026, Board of Directors Meeting
4. Receive Presentation on TOU-Smart Pilot and Provide Feedback and Recommendation to the Board of Directors
5. Receive Presentation and Provide Feedback on a Potential Contract Pricing Program
COMMITTEE MEMBER COMMENTS
ADJOURN – NEXT REGULAR MEETING ON MARCH 19, 2026
Public Records: Public records that relate to any item on the open session agenda for a Committee Meeting are available for public inspection. Those records that are distributed less than 72 hours prior to the meeting are available for public inspection at the same time they are distributed to all, or a majority of, the members of the Committee. Public records are available for inspection at CPA’s Office at 801 S. Grand Ave., Suite 400, Los Angeles, CA 90017, or online at www.cleanpoweralliance.org/agendas.
Agenda Page 2
Staff Report – Agenda Item 1
To: Executive Committee
Subject: Approve Minutes from the January 15, 2026, Executive Committee Meeting
Date: February 19, 2026
RECOMMENDATION
Approve.
ATTACHMENT
1. Minutes
Agenda Page 3
MINUTES
Executive Committee of the
Clean Power Alliance of Southern California
Regular Meeting
January 15, 2026
2:30 p.m.
Meeting videos are available on CPA's YouTube Channel.
http://www.youtube.com/@CPApublicmeetings
Committee Members participated in this meeting from the following locations:
Beverly Hills City Hall
Council Office, 4th Floor
455 N. Rexford Drive
Beverly Hills, 90210
Clean Power Alliance
Executive Conference Room
801 S. Grand Ave., Suite 400
Los Angeles, CA 90017
Sierra Madre City Hall
Council Chambers
232 W. Sierra Blvd.
Sierra Madre, CA 91024
Camarillo City Hall
Council Office
601 Carmen Drive
Camarillo, CA 93010
Hawthorne City Hall
Administrative Office
4455 W. 126th Street
Hawthorne, CA 90250
Carson City Hall
Executive Conference Room
701 East Carson Street
Carson, CA 90745
Calabasas City Hall
Council Conference Room
100 Civic Center Way
Calabasas, CA 91301
Ventura County Government Center
CEO Point Mugu Room
Hall of Administration
800 South Victoria Avenue
Ventura, CA 93009
Alhambra City Hall
Conference Room
111 S. First St.
Alhambra, CA 91801
CALL TO ORDER & ROLL CALL
Chair Klein Lopez called the meeting to order at 2:44 p.m. and Annie Mendoza, Deputy Clerk of the Board, conducted roll call.
Roll Call
Agoura Hills Deborah Klein Lopez Chair Remote
Alhambra Jeff Maloney Committee Member Remote
Beverly Hills Julian Gold Immediate Past Chair Remote
Camarillo Susan Santangelo Committee Member Remote
Carson Cedric Hicks Committee Member Remote
Hawthorne Alex Monteiro Committee Member Present
Executive Committee Item 1
Agenda Page 4
Los Angeles County Lindsey Horvath Vice Chair Present
Santa Paula Jenny Crosswhite Committee Member Remote
Sierra Madre Robert Parkhurst Committee Member Remote
Ventura County Vianey Lopez Vice Chair Remote
All votes are unanimous unless otherwise stated.
GENERAL PUBLIC COMMENT
There was no public comment.
CONSENT AGENDA
1. Approve Minutes from November 20, 2025, Executive Committee Meeting Motion: Committee Member Hicks, Carson
Second: Committee Member Monteiro, Hawthorne
Vote: The consent agenda was approved by a roll call vote.
REGULAR AGENDA
2. Oral Update from the CEO on CPA Operations
Ted Bardacke, Chief Executive Officer, stated that Lobby Day will be scheduled for sometime in March and topics will include the PCIA and transmission issues.
In response to Committee Member Monteiro’s questions about the Community Benefits Grant program, Mr. Bardacke noted that CPA received about 70 applications, up from 20 when the program first started. Committee Member Parkhurst complimented staff for their quick turnaround on interim rates.
3. Review Draft Agenda for the February 4, 2026, Board of Directors Meeting Mr. Bardacke discussed the consent agenda, including prepay bond transactions, and modification of the MW cap of the Dynamic Rates Pilot. Staff anticipate the enrollment cap may need to be increased to accommodate the interest of some large CPA customers who want to participate in the pilot. The regular agenda will include two informational items: the annual communications report and new customer programs report that will track progress and outcomes in dashboard format.
Vice Chair Horvath inquired about Los Angeles County’s potential participation in the Dynamic Rates Pilot, and staff responded that CPA staff could do some analysis with the County, particularly for sites that had the ability to alter demand in response to price signals. She also encouraged CPA to proactively publicize its commitment to its mission and its successes as a contrast to the national arena where government is perceived as retreating from its responsibilities.
Executive Committee Item 1
Agenda Page 5
CLOSED SESSION
4. CONFERENCE WITH LEGAL COUNSEL – Potential exposure to litigation pursuant to paragraph (2) or (3) of subdivision (d) of Section 54956.9: (1) Nancy Whang, General Counsel, stated that no reportable action was taken, but direction was provided by the Executive Committee.
COMMITTEE MEMBER COMMENTS
None.
ADJOURN
Chair Klein Lopez adjourned the meeting at 4:04 p.m.
Executive Committee Item 1
Agenda Page 6
Staff Report – Agenda Item 2
To: Executive Committee
From: Ted Bardacke, Chief Executive Officer
Subject: Oral Update from the CEO on CPA Operations
Date: February 19, 2026
The CEO will provide an oral update on CPA operations.
Agenda Page 7
Staff Report – Agenda Item 3
To: Executive Committee
From: Ted Bardacke, Chief Executive Officer
Subject: Review Draft Agenda for March 5, 2026, Board of Directors Meeting
Date: February 19, 2026
Staff will provide an overview of the proposed agenda items for the March 5, 2026, Board of Directors meeting for review and feedback from the Executive Committee. The draft Board agenda is attached to this staff report. Information on the main items for Board consideration is provided below.
CONSENT AGENDA
The following items are recommended for inclusion on the Consent Agenda of the March Board meeting.
Renew and Amend Credit Facility Agreement with JPMorgan Staff is in negotiations to renew and amend CPA’s $120 million credit agreement with JPMorgan Chase, which expires on March 31, 2026. The renewed credit agreement would extend the term for two years beginning April 1, 2026 and maintain CPA’s access to borrowings and letters of credit. Borrowings support CPA’s liquidity and letters of credit can be used for various obligations, including assisting CPA in meeting its Financial Security Requirement as obligated by the CPUC. The proposed amendments would reduce undrawn and letter of credit fees. The proposed amendments would also expand CPA’s contractual rights to cure a breach of its debt service coverage covenants, should one occur, and support covenant compliance in years in which CPA records lower margins.
Agenda Page 8
Executive Committee Item 3
If negotiations are successful, staff would present the proposed terms of an amended Credit Agreement and amended Fee Agreement to the Finance Committee at its February 25th meeting. Subsequently, the amended Credit Agreement and amended Fee Agreement and accompanying Resolution would be presented to the Board at the March 5 th Board meeting.
New Retirement Contribution Option
A retirement benefits option that increases CPA’s contribution to an employee’s retirement account under certain circumstances will be proposed to the Board. Currently, CPA contributes 6% to a 401(k)-type account plus an “up to 4% match” of employee contributions, for a total maximum possible CPA contribution of 10%. The proposed contribution option will increase CPA’s total maximum contribution to 14% in cases where cost savings to CPA can also be achieved.
Approve and Authorize Workforce Development MOU
On November 7, 2024, the Board approved funding for Phase 3 of the Workforce Development program. The program included plans to partner with two Multi-Craft Core Curriculum (MC3) pre-apprenticeship programs in Los Angeles County and to investigate options to partner with an MC3 provider in Ventura County. On February 6, 2025, the Board approved three-year MOUs with Flintridge Center and Women in Non-Traditional Employment Roles (WINTER) for MC3 pre-apprenticeship programs in Los Angeles County for $435,000 and $558,000 respectively. Five cohorts of MC3 trainees in Los Angeles County sponsored by CPA have graduated.
Staff conducted outreach to numerous MC3 stakeholders and providers in Ventura County over the past several months and have identified a set of program partners, including the Workforce Development Board of Ventura County (WDBVC), which currently partners with the Tri-Counties Building Trades and the Laborers’ International Union of North America (LiUNA) to provide MC3 training. CPA is in the process of negotiating a 2-year Memorandum of Understanding (MOU) wherein WDBVC will provide on-site MC3 training at Oxnard College, supportive services, stipends, and job placement Agenda Page 9
Executive Committee Item 3
via its partners in Ventura County, creating a delivery system similar to that successfully employed by Flintridge and WINTER. Should those negotiations be successful, an MOU for $481,058.37 to support three cohorts/90 students will be proposed for approval at the March Board meeting.
REGULAR AGENDA
The following items are recommended for inclusion on the Regular Agenda of the March Board meeting.
Amendments to the Reserves and Fiscal Stabilization Fund Policies Staff have conducted a review of CPA’s Reserves Policy and Fiscal Stabilization Fund (FSF) Policy and will be recommending the following amendments to the Finance Committee and, subject to their feedback, the full Board of Directors:
• Reserves Policy;
o increase the days liquidity on hand (DLOH) target from 120 days to a range of 150 to 240 days
• FSF Policy
o increase the maximum balance of the FSF from 10% of annual revenues to 20% of annual revenues
o authorize transfers into the FSF when the Net Position would increase in the absence of a transfer (from the current authorization to transfer only when increases in the Net Position would exceed 4% in the absence of the transfer)
The proposed amendment to the Reserve Policy would create a range of DLOH targets that better align with the Policy’s existing range of reserve targets of between 30% and 50% of operating budget expenditures. The proposed DLOH target range would also be consistent with CPA’s credit rating from Standard & Poor’s which was upgraded to ‘A’ in October 2025.
Agenda Page 10
Executive Committee Item 3
The amendments to the FSF will allow CPA to defer more revenue into the FSF to guard against future rate shocks, maintain compliance with financial covenants, and achieve annual budget objectives. The amendments would also increase CPA’s flexibility to transfer revenues into the FSF during years in which the Net Position has grown.
Amendments to both policies may also include minor administrative changes and terminology clean-up.
TOU-Smart Pilot
This item will be subject to a separate presentation to the Executive Committee.
Contract Pricing Program
This item will be subject to a separate presentation to the Executive Committee.
Open Nomination Period for Board Chair
Per CPA’s Bylaws, the Board of Directors must elect a Board Chair every two years. The current Board Chair’s term ends on June 30, 2026 and the new Chair’s term will begin on July 1, 2026.
The election of a new Board Chair will set in motion a process for the selection of Committee Chairs and thereafter election of At-Large Members of the Executive Committee according to the schedule below. The nomination period for the Board Chair position will open at the March Board meeting and remain open until March 13, 2026. A list of Directors who are eligible to be nominated will be provided to the Board.
Mar 5 – Mar 13: Board Chair Nomination Period
April 2: Election of Board Chair
By April 20: Board Chair selects Committee Chairs
May 7 – May 15: At-Large Executive Committee Nomination Period (3 positions) June 4: Election of At-Large Executive Committee Members Agenda Page 11
Executive Committee Item 3
July 2: Board Chair, Committee Chairs, Executive Committee At-Large Members begin new terms
ATTACHMENTS
1. Draft March 5, 2026, Board of Directors Agenda
Agenda Page 12
Executive Committee Item 3
Board of Directors of the
Clean Power Alliance of Southern California
Regular Meeting
Thursday, March 5, 2026
2:00 p.m.
CALL TO ORDER AND PLEDGE OF ALLEGIANCE
ROLL CALL
GENERAL PUBLIC COMMENT
CONSENT AGENDA
1. Approve Minutes from 5, 2026, Board of Directors Meeting
2. Amend and Extend Credit Facility Agreement with JPMorgan
3. New Retirement Contribution Option
4. Approve and Authorize the Chief Executive Officer to Execute the Workforce Development MOU for MC3 Training in Ventura County
5. Receive and File Quarterly Financial Report
6. Receive and File Quarterly Risk Management Team Report
7. Receive and File Quarterly Customer Programs Report
8. Receive and File Monthly Community Advisory Committee Report
REGULAR AGENDA
9. Amendments to the Reserves and Fiscal Stabilization Fund Policies (Action)
10. TOU-Smart Pilot (Action)
11. Contract Pricing Program (Info)
12. Open Nomination Period for Board Chair
COMMITTEE CHAIR UPDATES
MANAGEMENT REPORT
BOARD MEMBER COMMENTS
REPORT FROM THE CHAIR
ADJOURN
Agenda Page 13
Staff Report – Agenda Item 4
To: Executive Committee
From: Karen Schmidt, Sr. Director, Rates & Strategy
Reviewed by: Matt Langer, Chief Operating Officer
Nancy Whang, General Counsel
Approved By: Ted Bardacke, Chief Executive Officer
Subject: TOU-Smart Pilot
Date: February 19, 2026
RECOMMENDATION
Receive presentation and provide feedback and recommendation to the Board of Directors.
ATTACHMENT
1. TOU-Smart Pilot Presentation
Agenda Page 14
TOU-SMART Default Pilot Proposal
February 19, 2026
Agenda Page 15
In September 2025, the Board received a presentation and provided feedback on CPA staff’s proposal for a default TOU-SMART pilot to test the impact of lower daytime electricity rates on customer behavior and CPA energy costs
To address Board feedback and maximize the potential learnings from the pilot, staff has engaged top researchers at the UCLA Anderson School and Institute of Environment & Sustainability to advise on pilot design, support data analysis throughout the pilot, and document pilot results The proposed pilot will help CPA better understand how price signals, customer education, and messaging can influence beneficial load shifting behavior among customers with high levels of electrification and/or EVs
The pilot would default between 4,200 and 6,300 customers onto the TOU-SMART rate for two years o The customers would be selected from among 36,000 non-NEM customers who are on the TOU- D-PRIME rate, which is designed for residential customers with EVs, home batteries, and/or heat pumps for water or space heating
o Customers defaulted to TOU-SMART would be able to switch back to TOU-D-PRIME at any time and would receive bill protection for the duration of the pilot The results of the pilot could inform future CPA rate design, use of rates as a tool for meeting customer and CPA objectives, program recommendations to support load shifting, and associated marketing strategies
Staff requests Executive Committee feedback on the proposal and a recommendation to the Board on whether to move forward with the pilot
2 Summary
Agenda Page 16
The TOU-D-PRIME rate was introduced in 2019 as an option for residential customers with high energy usage, such as those with battery storage, EVs, or electric water or space heating Compared to TOU-D-PRIME, TOU-SMART has lower super off-peak (SOP) rates from 8am – 4pm, offset by increased off-peak rates from 9pm – 8am
This rate differential reflects the lower costs and emissions from energy generated during the day, when solar energy is abundant
3 In 2024, CPA introduced the TOU-SMART rate
as an option for TOU-D-PRIME customers
Agenda Page 17
A default TOU-SMART pilot would allow CPA to evaluate the impact of price signals and messaging on customer behavior The pilot would enable CPA to evaluate key questions about behavioral demand flexibility in response to price signals and behavioral messaging:
o How effective are low daytime rates at shifting residential electricity consumption? What is the magnitude and persistence of load shifts? How do these effects compare to other time-based pricing programs? o Which behavioral message frames best reinforce and sustain load shifting? Do different message strategies – e.g., emphasizing financial benefits versus environmental impact – produce different levels of adoption and long-term persistence in load shifting behavior?
o How do effects vary across customer segments? Are there differential impacts based on asset ownership (EV, pool, battery storage), current usage pattern, housing type, climate zone, income level, etc. that inform equitable program design?
Results would help inform future rate and program design o If the rate results in a significant shift in customer behavior, CPA might consider making it the default rate for all non-NEM TOU-D-PRIME customers
o Insights into customer price elasticity could inform modifications to TOU-D-PRIME and other TOU rates and improvements to other CPA rates and customer programs
o Post-pilot customer surveys could help inform customer segmentation and targeting of future marketing and education campaigns
Agenda Page 18
4 Collaboration with UCLA
Professor Magali Delmas of the UCLA Anderson School of Management, the Institute for Environment & Sustainability and Faculty Director of UCLA Anderson’s Center for Impact was recruited to collaborate with CPA in fall 2025, after the Board provided feedback Dr. Delmas has published extensively on the design of effective information strategies to promote conservation behavior, including a large-scale study on motivators, including rate design and customer messaging, for behavioral change in residential energy use Dr. Delmas reviewed CPA’s original proposed pilot design and assisted with refining it to help ensure that the pilot generates meaningful and actionable results as well as respond to Board feedback
If the pilot moves forward, Dr. Delmas, assisted by a post-doctoral researcher, has agreed to 1) continue advising CPA staff on detailed pilot design, including messaging strategies; 2) support data analysis throughout the pilot; and 3) provide interim, final and, ultimately, publishable reports on pilot results
While benefitting CPA and its customers specifically, the proposed pilot also presents an opportunity to fill important gaps in available research and literature on time-based pricing and to advance understanding of consumer demand elasticity and equity in California as a whole
Agenda Page 19
5 In September, the Board provided staff with feedback on key issues regarding pilot design and implementation
Staff conducted additional analysis of customer usage data and conferred with the UCLA advisers to address the following:
o Random vs targeted pilot participant selection: Should participants be randomly selected from CPA’s TOU-D-PRIME customer base as originally conceived by staff, or should the pilot attempt to target customers expected to be more able to respond to price signals (e.g., remote workers, EV owners)? Will a wide variety of CPA customers across member agencies be selected for the pilot? o Sample size to test impact across multiple variables: Is the proposed 2,600 customer sample size sufficient to detect meaningful load shifting behavior across different messaging treatments and other variables such as device ownership, climate zone, household size, and income level? o Magnitude of price signal: Can CPA increase the daytime price differential to maximize the signal to switch load away from on-peak and overnight hours, potentially lowering the daytime price to zero? o Customer protections: What additional measures should CPA consider to minimize impacts to pilot participants whose bills are consistently higher on the TOU-SMART rate? The updated proposal summarized on the following slide reflects staff and UCLA advisers’ combined recommendations based on analysis, literature review, and statistical methods that would stand up to peer review
6 The updated pilot proposal reflects detailed
analysis and consideration of Board feedback
Agenda Page 20
7 Pilot Design Recommendations
Design Parameter Recommendation Rationale
Price differential • Reduce daytime (8am-4pm) generation rate to $0/kWh – while preserving CPA revenue
neutrality
• Maximize strength of price signal to incentivize load shifting to daytime hours
• Test motivational impact of “zero-cost” daytime periods Participant
selection
• Default (auto-enrollment) with bill protection
and easy opt-out
• Randomized selection of TOU-D-PRIME
customers across all CPA communities,
except Phase 7, which would be excluded
• Exclude NEM/NBT customers and
customers served by CPA for less than 12
months
• Ensures sample size is large enough to detect meaningful load shifting with 95% confidence; avoids skewing toward “structural benefiters” who already have high daytime usage
• Findings will be representative of and applicable to a broad customer base across CPA communities
• Allows for rich subgroup analysis (e.g., by device ownership, current usage pattern, housing type, climate zone, income level) • Narrowing selection criteria (e.g., EV owners only) requires larger sample size and/or higher load shifting effect for significance Sample size • Option 1: ~4,200 (to test two messaging
treatments: financial, environmental focus)
• Option 2: ~6,300 (to test three messaging
treatments: zero-cost/”free” electricity, bill
savings, environmental focus)
• Detection of significant load shifting (≥10 kWh/month) requires ~2,100 sample size for each messaging treatment to be tested
• Includes 20% allowance for those who opt-out of the pilot Duration • 2 years • Test persistence of behavioral changes over time Added customer
protection
• Automatically disenroll customers with X%
(TBD) higher bills after year 1
• Limit financial impact for customers who are unable to respond to pilot price signals
• Limit CPA risk for high levels of bill protection payouts in year 2 Agenda Page 21
Customer selection, enrollment and bill protection
Pilot participants would be randomly selected from a pool of about 36,000 non-NEM customers across CPA’s service territory who are currently enrolled on the TOU-D-PRIME rate and have been CPA customers for at least one year Selected pilot participants would receive two notices by mail explaining their enrollment in the pilot, where to go for more information, and how to opt out of the pilot o Additional educational information and tips about how they are performing and how to reduce electricity costs will be shared with participants regularly throughout the pilot o The participants will be assigned to one of two or three treatment groups, each of which will receive distinct messaging frames (e.g., “zero-cost” focused, bill savings focused, and environmentally-focused)
Participants would be able to discontinue participation in the pilot at any time via the CPA website, email, or by contacting Customer Service
Participants would be provided with bill protection for the duration of their participation in the pilot
o If customers end up paying more on TOU-SMART than they would have on TOU-D-PRIME, they will receive a bill credit for the difference at the end of the pilot (or sooner if they switch rates or move out)
o Customers who are consistently paying significantly higher bills as a result of the pilot could be automatically disenrolled from the pilot at the end of year 1 Agenda Page 22
8 Proposed implementation timeline
9 April-July 2026: Prepare for customer outreach, enrollment and billing, and data collection and analysis
o Design and produce web page, fact sheet, customer mailers, member agency and call center talking points
o Work with Calpine to implement enrollment, billing, and bill protection requirements August-September 2026: Notify selected pilot participants o Deliver minimum of two customer notifications and fact sheet by mail, 60 days and 30 days ahead of launch
October 2026: Enroll selected default customers to new rate and begin monthly customer communications via mail and/or email
October 2027: Customer communication indicating full year performance and informing them of their options if they did not save money on TOU-SMART October 2028: Bill protection period ends. Evaluate and communicate pilot results and consider continuing, modifying, expanding or discontinuing the rate and other options Agenda Page 23
Next Steps
10 Staff requests feedback from the Executive Committee on the proposed pilot design and timing and a recommendation to the Board on whether to authorize staff to move forward with the pilot
If the Executive Committee recommends moving forward, staff will present the proposal to the Board in March and request approval of a resolution authorizing CPA to default the recommended set of CPA customers onto the TOU-SMART rate in the coming fiscal year and delegating to staff the development of terms and conditions Proposed modifications to the TOU-SMART rate differentials to set daytime generation rate at zero would be brought to the Board for approval in June as part of the FY 2026/2027 rate setting process
Agenda Page 24
Background on TOU Rates
Agenda Page 25
Time of Use (TOU) rates vary by time of day
and by season
Tiered rates (often called “flat rates”) are the
same regardless of time of day or season.
o Within Tiered Rates, usage above a
“baseline” is charged a higher rate
regardless of time of day
Benefits of TOU rates
o Better align prices with energy costs
o Encourage customers to shift usage to
lower cost hours
o Reduce cost shift from customers that
use a higher-than-average percent of
their electricity during high-cost hours
13 Time of Use versus Tiered Rates
Agenda Page 26
14 TOU Rates – Then, Now, and Going Forward
TOU rates for residential customers have been around since the 2010s, enabled in large part by smart meters. Almost all commercial customers and NEM/NBT customers are required to be on TOU rates.
In 2021-2022, residential customers served by IOUs in California were shifted to default TOU rates o This shift followed several TOU pilot programs that tested impact on customer behavior, timing of TOU periods, impact on economically vulnerable households, and other rate design factors o CPA followed suit and continues to mirror SCE rate design to minimize customer confusion o While TOU rates best align costs with rates, state policy has prioritized giving customers a choice to opt out of TOU and stay on tiered rates, especially when TOU rates would result in a higher bill o SCE places new residential customers on the TOU-D-4-9pm rate unless the customer requests a tiered rate or a different TOU rate e.g. (TOU-D-5-8pm, TOU-PRIME) o Approximately 60% of CPA’s residential customers are on TOU rates Smart devices and apps enable customers and service providers to adjust energy usage easily and automatically in response to TOU price signals
Starting in 2026 both residential and non-residential customers will be able to try more granular hourly market-based rates through the Dynamic Rate Pilot that CPA is participating in with SCE Agenda Page 27
Shifting usage from overnight to daytime hours,
when electricity is cheapest and cleanest, is
beneficial for CPA, customers, and the grid
TOU price differentials are seen as a tool to
promote this beneficial load shifting, and to
better align CPA rates and energy costs
CPA currently sets its TOU price differentials
based on SCE rates and has limited data to
inform a different approach. Key questions
include:
o Which customer types are most receptive
and responsive to varying price signals?
o How big a price differential is needed to
promote behavior change?
o How do TOU differentials and load shifts
impact customer bills and CPA energy costs?
15 Promoting a shift to daytime usage
Source: CAISO 2023 emissions data and 2025-2028 forward electricity prices.
Agenda Page 28
Staff Report – Agenda Item 5
To: Executive Committee
From: Jennifer Giles, Strategic Accounts Executive
Reviewed by: Matthew Langer, Chief Operating Officer
Nancy Whang, General Counsel
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Contract Pricing Program
Date: February 19, 2026
RECOMMENDATION
Receive presentation and provide feedback on a potential Contract Pricing Program.
ATTACHMENT
1. Potential Contract Pricing Program Presentation
Agenda Page 29
Potential Contract Pricing Program
February 19, 2026
Agenda Page 30
Executive Summary
2 CPA faces increasing opt-out risk from commercial customers seeking to enroll in Direct Access
o In 2026, CPA could lose up to 2000 non-residential customer accounts A significant pool of large commercial customers want high levels of renewables at predictable and/or fixed rates for 3-10 years
Some corporate customers want to bring their own resources via Virtual PPAs to meet renewable energy/sustainability goals
To respond to these trends, staff is exploring a contract pricing program to retain and attract customers while ensuring all customers are financially viable to CPA CPA is in a unique position to offer our 100% Green Power product to these customers, something SCE and DA providers can't always offer Agenda Page 31
Background on Direct Access
3 Direct Access (DA) is a program that allows non-residential customers to procure their own power. o DA participants can enroll with an Energy Service Provider (ESP) to meet their energy needs o ESPs must follow requirements similar to CCAs, such as meeting Resource Adequacy, Renewable Portfolio Standard, Integrated Resource Planning, and other statewide requirements o ESPs typically offer DA customers contracts to serve their load for a fixed period of time and DA customers can switch amongst ESPs or migrate back to a CCA or IOU when their contracts run out o DA rates are frequently customized by load profile and allow flexibility for different pricing structures, customers’ risk appetite, and desired energy mix
As part of California's energy restructuring, the Legislature adopted DA in 1996 and it was first implemented in 1998 o DA was partially suspended during the 2001 energy crisis and later reopened with a cap that was increased by the legislature in 2021 from 13% of IOU load to the current 15.4% Open cap space, if any, is allocated by a lottery run annually by each IOU that customers, even if they are served by a CCA, can choose to enter
o Cap space can open up if a customer migrates from DA to CCA, DA to IOU or if a DA account closes In recent years, SDG&E and PG&E have reached their caps, while SCE has had open cap space o SCE has lower rates than the other IOUs, making it more difficult for DA to be competitive o High short-term market prices in the last several years have made new DA contracts less competitive In 2026, increase in interest in the SCE DA lottery increased due to lower market costs o Around 2000 CPA accounts are eligible to sign DA contracts this year To date, CPA has not had an offering to directly compete with DA beyond standard CPA rate, although customers have approached CPA over the years seeking customized rate options either to directly compete with DA or for other reasons Agenda Page 32
Potential Contract Pricing Program
4 In response to market trends and with a goal to further evolve our use of rate customization to meet CPA’s mission while ensuring that customers cover their costs, staff has been developing a Contract Pricing Program where a customer would enter into a custom pricing contract with CPA under specified terms
Program parameters under consideration include:
o Eligibility: Customers who have won DA lottery and/or have not been a CPA customer for a period of time
o Contract Term: Could vary by customer (3-10 years), no opt-out allowed o Margin (modelled): At least 2% contribution over the term, consistent with overall CPA margin forecast o Program Participation Cap: TBD, may want to limit size/risk associated with the program o Customer Load Cap: TBD may want to have individual customer load growth cap for hedging purposes o Rate Product: 100% Green (and potentially Clean or other renewables mixture) o Rate: Customized to customer’s actual load/cost profile (potentially with provision for Virtual PPA resources or day-ahead market pricing)
Three rate options under consideration to offer customers:
o Fixed rate
o Fixed comparison with SCE Base (for entire term)
o Annual rate escalation w/ total bill comparison collar (i.e. floor of +1% to cap of +5% for 100% Green) Agenda Page 33
Fixed Rate Option
5 Apply annual Cost of Service (COS) rate plus 2% margin No CPA sensitivity to SCE rate or PCIA
Assumes 50,000 MWh annual load with a specific load shape on TOU-8-D rate for 100% Green *Illustrative example based on a forecast of SCE generation & delivery rates, PCIA and projected market costs for energy, resource adequacy, and renewable energy credits
Agenda Page 34
Fixed Comparison Option
6 Adjust rates annually to ensure a consistent comparison with SCE over the contract term At current projections, CPA can offer a +4.0% comparison for 2027-2031; this differs from standard comparisons because the calculations are based on the specific customer load profile and CPA will be able to separately hedge these costs for the contract term Assumes 50,000 MWh annual load with a specific load shape on TOU-8-D rate for 100% Green *Illustrative example based on a forecast of SCE generation & delivery rates, PCIA and projected market costs for energy, resource adequacy, and renewable energy credits
Agenda Page 35
Annual Escalation with Collar Option
7 Adjust rates annually to ensure comparison with SCE remains at or above a floor of +1% and at or below a floor of +5% over the contract term
To achieve a 2% margin, CPA would implement a higher margin at the beginning of the term Assumes 50,000 MWh annual load with a specific load shape on TOU-8-D rate for 100% Green *Illustrative example on a forecast of SCE generation & delivery rates, PCIA and projected market costs for energy, resource adequacy, and renewable energy credits
Agenda Page 36
Additional Considerations
8 Staff is evaluating a number of implementation considerations as part of program development in two broad categories:
Program criteria
o How to implement the rate comparison target given frequent SCE rate changes (most likely via annual true-up)
o Whether to offer product options beyond 100% Green including Clean Power or customized options
o Contract terms such as events of default, damages for termination, and other terms and conditions
Risk mitigation
o How to evaluate customer creditworthiness
o Limitations on load growth and pricing provisions should customer exceed a specified load growth amount
o Should there be an overall program enrollment cap, and if so, what size? o How would CPA hedge positions to reduce supply risk for specific customers? Agenda Page 37
Feedback and Next Steps
9 Staff requests that the Executive Committee provide feedback on the potential Contract Pricing Program
If the Executive Committee is supportive of continuing the development work, staff will present a further refined framework to the Board as an informational item at its March 5th meeting
o If the Board is supportive, staff would return at a later date with a more comprehensive proposal for the program
Staff is in discussions with a large load customer who opted out during mass enrollment and is interested in contract pricing for the 100% Green energy product. If the Executive Committee supports the general program approach, staff will continue discussions with that customer in the coming weeks and use those discussions as a guide for additional program development and contract terms Agenda Page 38