525 Golden Gate Avenue, 7th Floor
San Francisco, CA 94102
T 415.554.0773
TTY 415.554.3488
[email protected]
Date:
To:
December 2, 2024
Commissioner Kate H. Stacy, President
Commissioner Joshua Arce, Vice President
Commissioner Avni Jamdar
Commissioner Steve Leveroni
Through: D
ennis J. Herrera, General Manager
Barbara Hale, Assistant General Manager, Power
Michael Hyams, Deputy AGM, CleanPowerSF and Power Resources From: Cheryl Taylor, Manager, CleanPowerSF Operations
Subject: CleanPowerSF Quarterly Update
_______________________________________________________________ This m
emorandum serves as the regular quarterly update to the San Francisco Public Utilities Commission (SFPUC or Commission) on the Power Enterprise’s CleanPowerSF program.
This quarterly update focuses on the following topics:
1. Program Service Statistics and Enrollment Activities
2. Communications
Activities
a) Power Content Label
b) Rooftop Solar and Battery Storage Installer Listening Session c) Staff Tour
of The Geysers
3. Customer Programs Update
a) EV Charge SF Existing Building Pilot Program Expansion b) Heat Pump Water Heater Regional Contractor Incentive Program c) Electrify My Ride
d) Peak
Day Partners
e) SF LAFC
o Study on Battery Energy Storage Systems
4. Energy
Procurement and Planning Activities
a) Gonzaga Ridge Wind
b) Status
of Renewable Energy and Storage Solicitations
5. Regulatory Compliance Highlights
a) Renewables
Portfolio Standard, 2017-2020 Compliance Period
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1. Pr
ogram Service Statistics and Enrollment Activities
CleanPowerSF continues to provide clean electricity generation services to San Francisco customers, serving about 383,000 active customer accounts as of November 2024. CleanPowerSF’s opt-out rate remains stable at approximately 4.6% of all enrolled accounts.
Figure 1: CleanPowerSF Enrollment, November 2024
Cus
tomer enrollment in SuperGreen, CleanPowerSF’s optional 100% renewable energy product, is currently at about 2.1% of active accounts, down slightly from 2.2% in the previous quarterly report. In total, renewable energy sales to SuperGreen customers are expected to account for nearly 17% of CleanPowerSF’s energy sales in calendar year 2024.
Enrollment in the SuperGreen Saver program is at 1,076 accounts , below the available program maximum enrollment of approximately 1,167.
2. Communications Activities
a) Power Content Label
CleanPowerSF’s Power Content Label shows customers the sources of energy for Green, SuperGreen and SuperGreen Saver service for the previous calendar year (2023). For the first time since we began serving customers in 2016, all CleanPowerSF products were 100% renewable or greenhouse gas - free (GHG). SuperGreen and SuperGreen Saver we re each comprised of 100% Renewables Portfolio Standard (RPS) eligible energy, including solar, wind and geothermal. The Green product was comprised of 56.5% RPS energy and 43.5% large hydroelectric energy.
The Power Content Label has been translated into Chinese, Spanish, and Filipino. Customers are expected to receive their Power Content Label either by mail or email before the end of the year. A digitally accessible and
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downloadable version of the Power Content Label can be found at:
https://www.cleanpowersf.org/key-documents.
Figure 2: 2023 CleanPowerSF Power Content Label
b) R
ooftop Solar and Battery Storage Installer Listening Session CleanPowerSF is evaluating whether to transition its current Net Energy Metering (NEM) program to a Net Billing Tariff (NBT). The NBT is the successor to the long- standing NEM program offered by investor -owned utilities to rooftop solar customers. The California Public Utilities Commission (CPUC) approved this change on December 15, 2022 to address a rapidly growing subsidization of rooftop solar by non -participating ratepayers. 1 The 1 California Public Utilities Commission D. 22-12-056 (2022, December 15), accessed 11/27/2024;
https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M500/K043/500043682.PDF
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new tariff went into effect on April 15, 2023; NBT applies to new rooftop solar systems interconnected to the electric grid as of or after this date. The primary change from NEM to NBT is that solar electricity delivered to the grid is credited to the customer at a rate that more closely reflects the avoided cost or market value of the electricity generation rather than a full retail rate. Generally this is a reduction in the price paid per kilowatt hour generated.
In response, CleanPowerSF has begun an assessment of the impact of adopting an NBT-like tariff. To support this effort, s taff has initiated public outreach and engagement, beginning with an industry listening session which brought together local rooftop solar and battery storage providers to provide information on the current state of the market and barriers the industry is facing. This will be followed by a public webinar and workshop in early 2025 to engage customers and interested parties about proposed NEM program changes. Following public outreach, s taff may bring a recommendation to the Commission for adoption in mid-2025.
c) Staff Tour of The Geysers
Staff recently toured The Geysers, a geothermal energy complex that currently provides clean and reliable energy to CleanPowerSF customers. The Geysers is the world’s largest geothermal complex and is located about 75 miles north of San Francisco across both Sonoma and Lake Counties. Nearly 20% of CleanPowerSF’s renewable energy comes from geothermal facilities , like The Geysers. During the tour, staff learned more about geothermal energy, daily operations of the complex, and the experiences of the onsite staff.
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Figure 3: SFPUC staff touring The Geysers facility in Lake and Sonoma Counties on October 18,2024.
3. Customer Programs Update
C
leanPowerSF continues to develop and offer programs that help customers manage their energy costs, reduce their carbon footprint, and align with City and state environmental goals. Below are some highlights from this past quarter.
a) EV Charge SF Existing Buildings Pilot Program Expansion EV Charge SF is running a time-limited pilot providing financial incentives to CleanPowerSF multifamily, not-for -profit, and small business existing buildings to install EV chargers. If eligible, these customers can combine EV Charge SF’s incentives with the PG&E/Ecology Action Multifamily Housing and Small Business EV Charger Program
2 to receive fully designed and installed EV
chargers.
The pilot has received eight enrollments from multifamily properties ranging from five to 550 units. Six projects have reserved incentives, totaling $366,500.
One project has completed installation, and the team is in the verification process to issue the incentive payment.
2 For more information on PG&E’s Multifamily Housing and Small Business EV Charger Program, see https://pge.com/msevcprogram. Accessed on October 24, 2024.
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Figure 4: Two Enrolled Level 2 Charging Stations
b) Heat Pump Water Heater Regional Contractor Incentive Program CleanPowerSF is a key participant in a regional heat pump water heater program administered by the Bay Area Regional Energy Network (BayREN) to support residential water heating electrification. The program currently provides a $1,000 incentive to qualified installers for each electrified water heater . To date, the program has served nearly 400 installations with this incentive, an increase of 60% since the previous CleanPowerSF quarterly report update.
Staff expects a significant increase toward the close of the year. c) Electrify My Ride
Electrify My Ride offered a $1,000 instant rebate coupon off the purchase of a new e-bike from participating local bike retailers. The program operated from February to April with an incentive budget of $1 million. The program issued all 1,000 coupons to eligible SFPUC Power customers within three months of program operations. However, only approximately 350 of the 1,000 coupons were redeemed at participating retailers for an e-bike.
The program team plans to re-initiate the program in Spring 2025. Staff is evaluating the first phase of the offering and developing an equity-focused outreach and engagement plan to reach and enroll underserved, and hard to reach CleanPowerSF:
• Customers that speak languages other than English,
• Customers that identify as Black, Indigenous or Peoples of Color, • Customers who lack access to digital communications.
On November 14, 2024, the Mayor approved ordinance 268 -24 amending the Administrative Code to establish the E -Bike Incentive Fund. This new fund will support implementation of an electric bicycle (or “e-bike”) incentive program , to be administered by the Department of the Environment. The E-Bike Incentive Program would be similar in structure to the Electrify My Ride program. Power
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Enterprise s taff is tracking implementation of the E-Bike Incentive Program through SFPUC Policy and Government Affairs staff.
d) Peak Day Partners
The Peak Day Partners Program (PDP, formerly known as the Peak Day Pricing Program), is a voluntary demand response program that incentivizes large commercial customers to reduce their electricity consumption between 4:00 to 9:00 pm on "Event Days" , days with high temperatures when the grid is expected to be strained, from July 1 to October 31.
The 2024 Program ended on October 31 with a record number of Event Days.
Due to an unusually warm summer, the Program exceeded the Event Day limit within the first three weeks of the season and subsequently called Voluntary Event Days. CleanPowerSF staff are in the process of reviewing Partner usage data and calculating earned incentives. Staff is conducting an evaluation of the program and may recommend potential changes for the 202 5 season. Staff will report to the Commission on our findings in a subsequent quarterly report. e) SF LAFCo Study on Battery Energy Storage Systems
With funding provided by CleanPowerSF pursuant to a Commission-approved memorandum of understanding (MOU),
3 the San Francisco Local Area
Formation Commission (SF LAFCo) commissioned Arup International to conduct a study of barriers to battery energy storage system installations in San Francisco residential buildings. 4 The study’s purpose was to identify opportunities for improving San Francisco ’s policies and regulations related to the installation of home battery energy storage systems . This research is part of a series of pr oposed studies conducted under the MOU to examine opportunities for and barriers to local energy innovations and recommending policies and actions that would support decarbonization goals and other energy-related Climate Action Plan goals that are within CleanPowerSF’s scope of operations. The preparation of the study involved the participation and consultation of staff from LAFCo, the SFPUC’s Power Enterprise, the Environment Department, Department of Building Inspection and the Fire Department.
Battery storage is an important technology that will be part of San Francisco’s effort to achieve and maintain a 100% renewable energy supply. Batteries can store the energy produced by variable renewable generation for use when the energy is needed most, improving grid stability and reliability. The residential battery storage market is still developing and faces both cost and technical challenges. The LAFCo study provides general background on batteries and
3 The Commission approved the SFPUC-SF LAFCo MOU on April 25, 2024 in Resolution No. 23-0086, available at:
https://sfpuc.sharefile.com/share/view/se17618bf4bff4def8faf18cce4856596. Accessed on Nov. 22, 2024.
4 Arup International. “LAFCo Study for CleanPowerSF on Battery Energy Storage Systems.” Accessed November 4, 2024.
https://www.sfgov.org/lafco/sites/default/files/LAFCo_CleanPowerSF_BESS_Study_20 240916.pdf
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examines some of the barriers that may be slow ing their deployment in residential buildings.
The economics of energy storage is dynamic and constantly evolving in response to government policies, technological change, and global supply chains and markets. With the CPUC’s recent adoption of the Net Bi lling Tariff, oversizing solar has become a poor investment, which batteries can help mitigate, but adding a battery significantly increases the size of the overall investment required. Staff are exploring residential and commercial customers’ motivations to invest in battery storage and will be considering these drivers as we work to design new programs to serve CleanPowerSF customers.
4. Energy Procurement and Planning Activities
a) Gonzaga Ridge Wind Project
CleanPowerSF has secured its largest-ever single source of wind power through a new power purchase agreement with Scout Clean Energy for electricity produced by a to-be-constructed wind project in Merced County.
Gonzaga Ridge will provide 147.5 megawatts of clean wind energy as well as 50 megawatts of reliable energy storage for CleanPowerSF’s 383 ,000 customers in San Francisco.
Gonzaga Ridge will generate enough electricity annually to power approximately 120,000 average-sized San Francisco homes. Addition ally, the 50-megawatt four-hour battery energy storage system will store energy produced during the day for use in the evening, when power from the grid is more costly and reliant on natural gas. The project is anticipated to come online in May 2026.
5 b) Status of Renewable Energy and Storage Solicitations 2024 CleanPowerSF Renewable Energy Supplies Request for Offers (PRO.0280)
On July 11, 2024, the SFPUC issued the PRO.0280 solicitation, seeking offers of the following products from new and existing resources:
• Renewables Portfolio Standard- (RPS) eligible resources • RPS-eligible resources with a capacity factor of at least 80% , like geothermal and biomass (baseload renewables)
• RPS-eligible resources paired with storage
• Standalone battery storage resources up to eight hours in duration • Standalone battery storage resources eight or more hours in duration Through this solicitation, the SFPUC aims to secure new long-term supplies of renewable energy to meet the City’s clean energy targets, support rate stability and continue to make progress towards meetings CleanPowerSF’s regulatory
5 For more information on the Gonzaga Ridge Wind project see the SFPUC’s press release issued on October 24, 2024 at:
https://www.cleanpowersf.org/news/2024/10/23/sfpuc-commits-to-largest-wind- development-in-cleanpowersf-history. Accessed on Nov. 22, 2024.
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obligations, including those under the Resource Adequacy program and the California Public Utilities Commission’s Mid-Term Reliability procurement order.
The SFPUC receiv ed 62 unique offers from 43 projects in response to PRO.0280. However, no offers for baseload renewables were received. A final version of the shortlisted projects was posted on October 25 th. Staff will be commencing contract negotiations soon and expects to finalize and execute agreements in the first half of 2025.
Interconnection Process Enhancements Request for Qualifications (PRO.0322) The California Independent System Operator (CAISO) launched the Interconnection Process Enhancements (IPE) initiative in 2023 to address the significant delays in processing developers’ applications to interconnect to the CAISO-managed electric transmission grid due to the backlog of projects in the queue. The IPE aims to identify the most viable and needed projects in the queue and will prioritize projects located in zones where transmission capacity is available. Part of the process includes consideration of commercial viability through the award of Commercial Interest Points from load serving entities located within the CAISO Balancing Authority Area. CleanPowerSF and Hetch Hetchy Power were both provided with points to allocate to projects.
Staff issued PRO.0322 on October 1
st to support the identification of projects
for SFPUC Commercial Interest Points allocation. The solicitation closed on October 23rd. The project team evaluated the 65 proposals received and posted a shortlist of the highest-ranking proposals on November 18 th, updated November 26 th. Selected projects have been invited to proceed with the execution of an Exclusivity Agreement which will require proposers to submit a binding bid into a future SFPUC power supply solicitation within two years of a project reaching the Phase II Interconnection study results milestone.
Participation in this process will help ensure the SFPUC has an opportunity to contract with projects it has identified as best meeting the CAISO’s and SFPUC’s long -term resource planning needs once they are commercially viable.
5. Regulatory Compliance Highlights
a) Renewables Portfolio Standard, 2017-2020 Compliance Period As reported previously, CleanPowerSF is under the regulatory jurisdiction of several state entities responsible for achieving California’s clean energy and carbon emissions reduction goals. Among them, the California Public Utilities Commission (CPUC) and the California Energy Commission (CEC) jointly implement the state’s Renewable Portfolio Standard (RPS) program to which CleanPowerSF is subject. A key requirement of the RPS program is that load- serving entities like CleanPowerSF procure an increasing portion of their electricity from renewable energy. The CPUC determines compliance with the RPS program rules once the CEC certifies that the procured renewable energy was generated from RPS-eligible facilities. These actions occur at the end of each multi-year period; the last period for which CPUC made its determination was Compliance Period 3, from 2017 to 2020.
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The CEC certified CleanPowerSF’s 2017-2020 claimed renewable energy procurement as RPS-eligible in January 2023. 6 Subsequently, CleanPowerSF submitted its final 2017 –2020 RPS Compliance Report to the CPUC in March 2023, showing that it exceeded the CPUC’s annual targets for each year of the compliance period.
Figure 5: Renewable Portfolio Standard (RPS) Procurement, 2017-2020
In April 2024, notwithstanding the CEC’s determination, the CPUC staff notified CleanPowerSF of non-compliance with RPS program rules and a potential fine of over $10 million. At issue was a contract associated with over 200,000 megawatt hours of RPS -eligible renewable energy that did not include a CPUC-required standard term and condition. CleanPowerSF – working with the City Attorney’s Office – requested the Commission waive the potential fine and determine that CleanPowerSF is in compliance. 7 In October 2024, the Commission determined that CleanPowerSF met its RPS program obligations but was out of compliance with RPS contracting rules . The Commission reduced the potential fine from $10 million to $500.8 CleanPowerSF has worked with the Business Services Audit Bureau to identify deficient contracts and is working with the City Attorney’s O ffice to amend such contracts to
6 See page 24 of the California Energy Commission Renewables Portfolio Standard 2017-2020 Retail Sellers Procurement Verification – Commission Final Report (CEC- 300-2022-011-CMF). Accessed on November 13, 2024.
https://efiling.energy.ca.gov/GetDocument.aspx?tn=248616 7 See CleanPowerSF Motion for Waiver of Penalties and Motion to Determine Compliance with the Renewable Portfolio Standard Procurement Reporting Requirements and to Rescind Assessed Penalty, filed on May 17, 2024. Accessed on November 13, 2024.
https://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M532/K043/532043414.PDF 8 See California Public Utilities Commission Decision on Motions for Waiver of Renewables Portfolio Standard Program Requirement for Compliance Period 2017- 2020, issued on October 18, 2024 (D.24 -10-009). Ac cessed on November 13, 2024. https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M543/K728/543728540.PDF.
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ensure all CPUC-required standard terms and conditions are included in CleanPowerSF’s RPS procurement contract.