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San Francisco, CA 94102
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Date: January 2, 2025
To: Clerk of the Board of Supervisors
Through: Dennis J. Herrera, General Manager
Barbara Hale, Assistant General Manager, Power
Michael Hyams, Deputy Assistant General Manager,
CleanPowerSF and Power Resources
From: Julia Olguin, Director, Origination and Power Supply Justin Chebahtah, Regulatory Specialist, Origination and Power Supply
Subject: Power Quarterly Report on Delegated Authority Contracts Pursuant to Administrative Code Section 21.43
The following quarterly report has been prepared for the Board of Supervisors (Board) in accordance with Section 21.43 of the Administrative Code.
In Administrative Code Section 21.43, the Board delegated to the General Manager of the San Francisco Public Utilities Commission (SFPUC) authority to execute certain contracts with terms in excess of 10 years or requiring expenditures of $10,000,000 or having anticipated revenue of one million dollars or more subject to specified limitations through June 30, 2025.
Administrative Code Section 21.43 also required the SFPUC to report quarterly to the Board “the duration, product purchased, and cost of contracts entered.” Awarded Per Administrative Code Section 21.43
Quarter 2 (October 1, 2024 – December 31, 2024)
CONTRACT TYPE PRODUCT COUNTERPARTY DURATION CONTRACT AMOUNT Purchase Capacity NextEra 6/1/2027 –
5/31/2042 $221,130,000
Purchase Renewable
Energy
Pacific Gas &
Electric Company
1/1/2023 -
12/31/2042 $29,560,285
Cheryl Taylor for Michael Hyams
Randi H. Cheuk for Julia Olguin
P a g e | 2
This quarter includes an amendment to CleanPowerSF’s Energy Storage Agreement with NextEra that reduced the contract price over the 15 -year term as reported in the 4th quarter fiscal year 2022-23 report.
The Pacific Gas and Electric Company (PG&E) contract listed above was originally executed on July 25, 2022. The agreement was executed so that CleanPowerSF could participate in PG&E’s Voluntary Allocation Market Offer (VAMO), as ordered by the CPUC in Decision (D.) 21-05-030.
Through a process approved by the CPUC, CleanPowerSF elected to receive an allocation of PG&E’s Renewable Portfolio Standard (RPS) eligible renewable energy resources from January 1, 2023, through December 31, 2024. Under D. 21.05 -030, selected allocations were to be priced at each contract year’s applicable RPS Market Price Benchmark set by the CPUC, with the revenues offsetting the contract costs CleanPowerSF customers are required to pay PG&E under the Power Charge Indifference Adjustment. [1] At execution in 2022, the estimated total cost of the agreement was less than $10 million. However, the increasing market value of RPS -eligible renewable energy in 2023 and 2024 raised the total cost. On March 19, 2024, the General Manager approved the contract under Administrative Code Section 21.43, using updated 2023 and 2024 Market Price Benchmark values that increased total expenditures above $10 million. The CPUC finalized the Market Price Benchmark on November 5, 2024, and the reported contract amount reflects this final benchmark value.
This report meets the quarterly reporting requirements established by Section
21.43 of the Administrative Code for contracts executed under the delegation of authority. Should you have any questions, please contact Barbara Hale, SFPUC Assistant General Manager, Power, at [email protected] and (415) 613-6341.
[1] The Power Charge Indifference Adjustment, or PCIA, is a charge on all PG&E retail distribution customer bills, including those receiving generation services from CleanPowerSF.
The PCIA was created by the CPUC to recover the unavoidable above -market costs of contracts PG&E entered into prior to the customers’ start of generation service from CleanPowerSF. The PCIA charge is intended to ensure that the remaining customers taking generation service from PG&E are not unfairly burdened by these contract costs. Revenues received from sales of generation products from PCIA -eligible contracts reduce the overall PCIA cost obligation for customers that take generation service from community choice aggregation programs like CleanPowerSF.