DEPARTMENT Power Enterprise
AGENDA NO.
10 MEETING DATE
June 13, 2023
AGENDA ITEM
Public Utilities Commission
City and County of San Francisco
Authorize Amendment to Memorandum of Understanding (MOU): Regular Calendar Project Manager: Danny Phung
Authorize Amendment 1 to the Airport Electric Capacity Upgrade Program Services Memorandum of Understanding
Summary of
Proposed
Commission Action:
Authorize the General Manager to execute an Amendment to the Memorandum of Understanding between the San Francisco Airport Commission (the Airport or SFO), and the San
Francisco Public Utilities Commission ( SFPUC) to extend the term for two years to end on June 30, 2025, with no change in the not-to-exceed amount of $3,800,000, to complete the engineering design work required for the development and environmental review of the Electric Capacity Upgrade Prog ram (Program) to increase capacity and improve redundancy at the PUC-owned airport substations (Substations).
Background: Power Ente rprise’s largest customer is the Airport. The Power Enterprise provides Hetch Hetchy P ower service to the Airport utilizing the S ubstations. Based on its projected growth and changes in the use of electricity, the Airport has identified the need for improvements at the Substation s to increase capacity and improve redundancy. The Commission authori zed the
General Manager to enter a Memorandum of Understanding
with the A irport under Resolution N o. 21- 0108 to perform design work to support the increased capacity and improve redundancy at the Substations.
The Substations interconnect to 115kV high voltage lines owned by Pac ific Gas and Electric C ompany (PG&E) through PUC- owned equipment, and power is stepped down through the
SFPUC transformers and feeds the Airport-owned 12kV medium voltage substations. The Substations are on Airport property and exclusively se rve the Airpor t. The PG&E-owned equipment at the Substations and Airport-owned equipment downstream from the Substations may also need improvement, but such
improvements are beyond the scope of th e Memorandum of Understanding.
The SF PUC and the Airport have proc ured the high- voltage consultant, LEAN Technology Corp oration (LEAN) to develop Agreement: Authorize Amendment 1 to Airport Electric Capacity Upgrade Program Services MOU Commission Meeting Date: June 13, 2023
the basis of design for the Prog ram. The SFPUC will fund LEAN’s work relating to the portions of the Pr ogram addressing the upgrades to the S ubstations, as outlined in the M emorandum of Unders tanding, Scope of Services (Services), and also reimburse the Airport for personnel time to manage the
consultant. The Memorandum of Understanding documents the agreement between the Airport and the SF PUC regarding the Program.
The Services are in pro gress but will not be completed by June 30, 2023.
Description of
Agreement:
Extend the term with an end date of June 30, 2025.
Parties to
Agreement:
San Francisco Airport Commission
and the San Francisco Public Utilities
Commission
Purpose: To extend termination date to June 30,
2025 to provide Airport electric
capacity upgrade program services
Location: SFO
Commencement
Date:
Ongoing
Result of Inaction: A delay in authorizing this Amendment will also delay the Program.
Budget & Costs: Not-to-Exceed Amount: $3,800,000.
Funds: The design work phase of the Program was appropriated $3,800,000 and is part of the Hetch Hetchy Power 10-year Capital and Financial Plans.1
The SFPUC is not required to reim burse the Airport for any costs beyond the Budget Amount or for any services beyond the Services listed in Appendix A of the MO U, unless the Airp ort and PUC enter a written modification to th e MOU documenting such changes.
The SFPUC will reimburse the Airport for the actual costs of salary and mandatory fringe benefits for Airport per sonnel management of the Consultant for (1) procuremen t of the Consultant, (2) Consultant work on the basis design and design document, (3) Consultant support for the environm ental review
1 Power Enterprise will seek additional funding appropriation during the budgeting process for subsequent planning , construction and commissioning phases of the Program. Power Enterprise anticipates additional amendments or MOU(s) that address the scope of services for these phases.
Agreement: Authorize Amendment 1 to Airport Electric Capacity Upgrade Program Services MOU Commission Meeting Date: June 13, 2023
documentation, and (4) project management during the basis design and design document stage.
As of May 11 , 2023, $1,194,108 of the progr am budget of $3,800,000 has been expended.
Schedule: The term of this Amendment is from July 1, 2023 through June 30, 2025.
Environmental
Review:
Approval of this amendment by this Commission does not fall within the definition of a “project” under the California Environmental Quality Act Guidelines Section 15378 as the design services provi ded under this Memorandum of
Understanding do not involve any direct or indirect physical change in the environment.
Recommendation: SFPUC staff recommends that the Commission adopt the attached resolution.
Attachment: 1. Amendment 1 to Memorandum of Understanding
PUBLIC UTILITIES COMMISSION
City and County of San Francisco
RESOLUTION NO.
WHEREAS, The San Francisco Airport Commission ( Airport or SFO) and the S an Francisco Public Utilities Commission (SFPUC), each of which is a department or agency of the City and County of San Franc isco (City), are collaborating on the Airport Electric Capacity Upgrade Program Services (Program); and
WHEREAS, The SFPUC pr ovides Hetch Hetchy power to the Airport through two SFPUC-owned substations located on SFO property, Airport Substation and S ubstation MA (Substations). Based on its future load dem and profile, the Airport has identified the need t o increase capacity to me et anticipated demand through improvements made at the Substations to increase capacity and improve redundancy for pow er supply scenarios outside of norm al operations; and
WHEREAS, The SFPUC and the Airport wish to enter into a n Ame ndment to the Memorandum of Understanding wherein the Airport w ill procure the high -voltage consultant to provide services for the design, development, and environmental review of the Program and the SFPUC will fund the consultant’s work rela ting to the portions of t he Program addressing the upgrades to the Substations as outlined in Appendix A, Scope of Services of the MOU; and WHEREAS, The Commission a uthorized the Gener al Manager to enter into a Memorandum of Understanding with the Airport; and
WHEREAS, The M emorandum of Understanding was entered int o agreement between the Airport and the SFPUC with a term of June 1, 2021 through June 31, 2023; and WHEREAS, On August 31, 2021, the Airport issued a Request for Proposal/Qualification to procure a high- voltage consultant. On October 15, 2021, after receiving fi ve proposals, the Airport awarded the contract to the highest-ranked proposer through an evaluation by a selection panel including SFPUC staff. The highest ranked proposer was LEAN Technology Corporation (LEAN). Subsequently, the contract t erms and conditions, inc luding fee and contract amou nt were negotiated. On March 14, 2022, the Airport entered to a contract with LEAN , and on May 6, 2022 the Airport issued LEAN a Notice-to-Proceed; and WHEREAS, LEAN has assessed, studied , and developed mult iple a lternatives for substation upgrades and c ompleted a d raft feasibility report. This report is currently being reviewed by the SFPUC and Airport. LEAN, together with the Airport and the SFPUC, have also engaged with the Pacific Gas and Electric Company on a required Transmission Interconnection System Impact Study; and
WHEREAS, As of May 11, 2023, $1,194,108 of the $3,800,000 program budget has been expended; and
WHEREAS, Approval of this amendment by this Commission does not fall within the definition of a “project” under the California Environmental Quality Act Guidelines Section 15378 as the design services provided under this Memorandum of Understanding do not involve any direct or indirect physical change in the environment; now, therefore, be it
RESOLVED, That this Commission her eby authorizes the General Manager to execute the Amendment 1 to the M emorandum of Understanding with the Airport to extend the term to June 30, 2025; and, be it
FURTHER RESOLVED, That this Commission hereby authorizes the General Manager to enter into any other amendments or modifications to the Memorand um of Understanding with the Airport that the General Manager determines, in consultation with the City Attorney, are in the best interest of the City; do not materially increase the obligations or liabilities of the SF PUC or materially diminish the benefits to the SFPUC; are necessary or advis able to effectuate the purposes and i ntent of the Memorandum of Understanding or this resolution; and are in compliance with all applicable laws, including the City Charter.
I hereby certify that the foregoing resolution was adopted by the Public Utilities Commission at its meeting of June 13, 2023.
Secretary, Public Utilities Commission
AMENDMENT NO. 1 TO
MEMORANDUM OF UNDERSTANDING
BETWEEN THE SAN FRANCISCO AIRPORT COMMISSION
AND
THE PUBLIC UTILITIES COMMISSION
Airport Electric Capacity Upgrade Program Services
This Amendment No. 1 (this “Amendment”) is entered into as of July 1, 2023, to amend the Memorandum of Understanding (“MOU”), entered into as of August 1, 2021, by and between the San Francisco Airport Commission (the “Airport”), and the San Francisco Public Utilities Commission(“PUC”), to extend the term of the MOU.
1. AMENDMENT. The term of the MOU is extended by two years to a new expiration date of June 30, 2025.
2. DIGITAL SIGNATURES. The Airport and PUC may use Digital Signatures, affixed using the City’s DocuSign platform, to execute this Amendment and all subsequent modifications.
For this purpose, “Digital Signature” means an electronic identifier, created by computer, intended by the party using it to have the same force and effect as the use of a manual signature.
3. CONFIRMATION OF ORIGINAL MOU. The original MOU is hereby confirmed, and its terms and conditions shall continue in full force and effect except as specifically modified by this Amendment.
4. PROGRAM STATUS. The Program status is described in detail in Appendix A attached.
This Amendment has been entered into in duplicate on the date(s) below.
___________________________ _______________________
Ivar C. Satero Date
Airport Director
San Francisco Airport Commission
___________________________ _______________________
Dennis Herrera Date
General Manager
San Francisco Public Utilities Commission
APPENDIX A
PROGRAM STATUS UPDATE
May 11, 2023
A. On July 13, 2021, by Resolution No. 21-0108, the Commission authorized the Director to enter into a Memorandum of Agreement with the Airport.
B. On August 17, 2021, the Airport and PUC agreed to the MOU.
C. On August 31, 2021, the Airport issued a Request for Proposal/Qualification to procure a high-voltage consultant. On October 15, 2021, after receiving five proposals, the Airport awarded the contract to the highest-ranked proposer through an evaluation by a selection panel including PUC staff. The highest ranked proposer was LEAN Technology Corporation (“LEAN”). Subsequently, the parties negotiated contract terms and conditions, including fee and contract amount. On March 14, 2022, the Airport entered a contract with LEAN. On May 6, 2022, the Airport issued LEAN a Notice to Proceed.
D. To-date, the LEAN has assessed, studied, and developed multiple alternatives for substation upgrades and completed a draft feasibility report. This report is currently being reviewed by PUC and Airport. LEAN, together with the Airport and PUC, have also engaged with Pacific Gas and Electric on a required Transmission Interconnection System Impact Study.
E. As of May 11, 2023, $1,194,108 of the program budget of $3,800,000 has been expended.