DESERT COMMUNITY ENERGY
MEETING AGENDA
Monday, September 15, 2025
3:00 p.m.
Palm Springs City Hall
Large Conference Room
3200 E. Tahquitz Canyon Way
Palm Springs CA 92262
Members of the public may use the following link for listening access and ability to address the Desert Community Energy Board when called upon:
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Webinar ID: 820 9914 6709
Password: 959258
IF YOU ARE UNABLE TO CONNECT VIA DIAL IN OPTION,
PLEASE CALL 760-346-1127.
Members of the public are encouraged to submit comment in connection with the Desert Community Energy meeting by email to: [email protected] by 5:00 p.m. on the day prior to the Board meeting. Members of the public joining the meeting by Zoom can provide comment by using the “raise hand” feature or hitting *9 on the phone keypad.
As a convenience to the public, DCE provides a call-in and internet-based option for members of the public to virtually observe and provide public comments at its meetings. Please note that, in the event of a technical issue disrupting the call-in or internet-based options, the meeting will continue unless otherwise required by law.
THIS MEETING IS HANDICAPPED ACCESSIBLE.
ACTION MAY RESULT ON ANY ITEMS ON THIS AGENDA.
1. CALL TO ORDER – Chair Jeffrey Bernstein, City of Palm Springs
2. ROLL CALL
A. Member Roster P4
3. AGENDA MODIFICATIONS (IF ANY)
4. PUBLIC COMMENTS ON AGENDA ITEMS
This is the first of two opportunities to address the Board. Any person wishing to address the Desert Community Energy Board on items appearing on this agenda may do so at this time.
Please limit comments to 3 minutes. At the discretion of the chair, additional public comment time and/or opportunities during the meeting may be granted.
5. BOARD MEMBER / EXECUTIVE DIRECTOR COMMENTS
6. CONSENT CALENDAR
A. Approve the minutes of the June 16, 2025, Board meeting P5
6.1 ITEMS HELD OVER FROM CONSENT CALENDAR
7. DISCUSSION / ACTION
A. Presentation: Calpine Community Energy’s Community Benefits Grant Program – P8 Matthew Messina, Director of Client Services for Calpine Recommendation: Information
B. DCE Mid-Term Reliability Procurement: Resource Adequacy + TB8 with Balsam P9 Project LLC – Lisa McNeilly
Recommendation: Adopt Resolution No. 2025-06, approving a 15-year Resource Adequacy + TB8 Agreement (RA+TB8) with Balsam Project LLC (Balsam) for its San Bernardino County Battery Energy Storage System (BESS) project and authorizing the Executive Director and/or Legal Counsel to make minor modifications before execution of the agreement C. Establishing a New Energy Efficiency Program for DCE Customers – Eman Nazir P14 Recommendation: Approve the proposed Energy Efficiency Program Plan for DCE customers and authorize the Executive Director to take the necessary steps to finalize and submit an Elect-to-Administer Tier 3 Advice Letter to the California Public Utilities Commission in support of the approved program plan
8. INFORMATION
A) Attendance Record P17
B) Update on General Rate Case P18
C) Unaudited Year-to-Year Financial Report as of June 30, 2025 P20 D) DCE’s Quarterly Investment Report through June 30, 2025 P25
9. PUBLIC COMMENTS ON NON-AGENDA ITEMS
This is the second of two opportunities to address the Board. Any person wishing to address the Board on items not appearing on this agenda may do so at this time. Please limit comments to 2 minutes. At the discretion of the chair, additional public comment time and/or opportunities during the meeting may be granted.
10. ANNOUNCEMENTS
The next DCE Board meeting will be held October 20, 2025, at 3:00 p.m. at the Large Conference Room at Palm Springs City Hall, 3200 E. Tahquitz Canyon Way, Palm Springs, 92262.
11. ADJOURNMENT
DESERT COMMUNITY ENERGY
BOARD MEMBER ROSTER
Voting Members Seat on Committee Representative
City of Palm Desert Vice Chair
Veronica Chavez
Finance Director
City of Palm Springs Chair
Jeffrey Bernstein
Councilmember
DCE Staff
Tom Kirk, Executive Director
Claude Kilgore, Director of Finance
Lisa McNeilly, Director of Energy & Sustainability
Savannah Gil, Program Specialist
Janice Reitman, Accounting Manager
ITEM 6A
Desert Community Energy Board
Meeting Minutes
June 16, 2025
1. CALL TO ORDER
The meeting of the DCE Board was called to order by Chair Jeffrey Bernstein at 3 p.m. at Palm Springs City Hall, Large Conference Room, 3200 E. Tahquitz Canyon Way, Palm Springs, CA 92262.
2. ROLL CALL
Roll call was taken, and it was determined that a quorum was present.
Members Present Member Jurisdiction
Councilmember Jeffrey Bernstein, Chair City of Palm Springs Finance Director Veronica Chavez, Vice Chair City of Palm Desert
3. AGENDA MODIFICATIONS (IF ANY)
None
4. PUBLIC COMMENTS ON AGENDA ITEMS
None
5. BOARD MEMBER/EXECUTIVE DIRECTOR COMMENTS
Director of Energy & Sustainability Lisa McNeilly shared an update on the Community Benefits Grant Program that is being launched as part of the new contract with Calpine, adding that staff will be presenting an agenda item in the fall to provide additional details.
6. CONSENT CALENDAR
IT WAS MOVED BY VICE CHAIR CHAVEZ AND SECONDED BY CHAIR BERNSTEIN TO APPROVE THE FOLLOWING CONSENT CALENDAR:
A. Approve the minutes of the May 19, 2025, Board meeting B. Authorize the Executive Director to execute an agreement with MRW & Associates, LLC for a not-to-exceed amount of $51,890 through June 2027, authorizing work on the 2025 Integrated Resource Plan as required by the California Public Utilities Commission
C. Adopt Resolution 2025-03, approving the 2024 Power Source Disclosure Annual Report, and authorizing the Executive Director to complete all actions necessary The audio file for this meeting can be found at: http://www.desertcommunityenergy.org Desert Community Energy Board of Directors
Meeting Minutes – June 16, 2025
for submittal to the California Energy Commission, including attesting to its veracity
D. Approve updates to Policy No. 18-13 related to Budget and Accounting Policies THE MOTION CARRIED WITH 2 AYES.
Chair Bernstein Aye
Vice Chair Veronica Chavez Aye
6.1 ITEMS HELD OVER FROM CONSENT CALENDAR
None
7. DISCUSSION / ACTION
A. DCE Fiscal Year 2025-26 Budget
Director of Finance Claude Kilgore presented the staff report providing the Board with an overview of the upcoming fiscal year budget.
Robust member discussion ensued with Mr. Kilgore answering questions regarding budget projections and comfortability with projections given recent years’ volatility.
IT WAS MOVED BY VICE CHAIR CHAVEZ AND SECONDED BY
COUNCILMEMBER BERNSTEIN TO ADOPT RESOLUTION 2025-04
APPROVING DESERT COMMUNITY ENERGY’S FISCAL YEAR 2025-26 BUDGET
THE MOTION CARRIED WITH 2 AYES.
Chair Jeffrey Bernstein Aye
Vice Chair Veronica Chavez Aye
B. DCE Mid-Term Reliability Procurement: Resource Adequacy + TB4 with Athos Storage, LLC
Ms. McNeilly presented the staff report.
Brief member discussion ensued with comments from Board members.
IT WAS MOVED BY VICE CHAIR CHAVEZ AND SECONDED BY CHAIR BERNSTEIN TO ADOPT RESOLUTION 2025-05, APPROVING A 15-YEAR RESOURCE ADEQUACY + TB4 AGREEMENT (RA+TB4) WITH ATHOS
STORAGE, LLC, FOR ITS RIVERSIDE COUNTY BATTERY ENERGY STORAGE
SYSTEM (BESS) PROJECT NEAR DESERT CENTER AND AUTHORIZING THE
EXECUTIVE DIRECTOR AND/OR LEGAL COUNSEL TO MAKE MINOR
MODIFICATIONS BEFORE EXECUTION OF THE AGREEMENT
THE MOTION CARRIED WITH 2 AYES.
Desert Community Energy Board of Directors
Meeting Minutes – June 16, 2025
Chair Jeffrey Bernstein Aye
Vice Chair Veronica Chavez Aye
C. Presentation: Summer power supply outlook
Jaclyn Harr with The Energy Authority, joined the meeting via Zoom and provided an overview of the power supply outlook for the summer.
No action was taken as this was an informational item only.
8. INFORMATION
The following items were included in the agenda packet for members’ information :
A) Attendance Record
B) Summary of June 2025 Rate Adjustment
C) Coachella Valley Association of Governments’ Meeting Calendar for Fiscal Year 2025-26
9. PUBLIC COMMENT ON NON-AGENDA ITEMS
None
10. ANNOUNCEMENTS
The next DCE Board meeting will be held July 21, 2025, at 3:00 p.m. at the Large Conference Room at Palm Springs City Hall, 3200 E. Tahquitz Canyon Way, Palm Springs, 92262.
11. ADJOURNMENT
There being no further business, Chair Bernstein adjourned the meeting at 4:03 p.m.
Respectfully submitted,
Elysia Regalado
Management Analyst
ITEM 7A
STAFF REPORT
Subject: Presentation: Calpine Community Energy’s Community Benefits Grant Program
Contact: Lisa McNeilly, Director of Energy & Sustainability ([email protected]) Recommendation: Information
Background: Calpine Community Energy (also known as Calpine Energy Solutions, LLC provides front-line customer services for DCE. The relationship dates back to February 2018, when the DCE Board authorized a contract with Calpine to provide data management and customer call center services through February 26, 2025. DCE staff in late 2024 began conversations with Calpine staff to discuss a new agreement before the next renewal occurred, and DCE’s Executive Director in February signed a two-month amendment to the contract extending it through April 30, 2025. On May 19, 2025, the Board approved an agreement with Calpine Community Energy to provide data management and customer call center services through April 2028.
The new contract establishes a community benefits grants program for the DCE service territory.
For this program, Calpine rebates two percent of the annual data management service fees directly to local 501c(3) organizations for the purpose of promoting economic development, local project development, grid resiliency, and other areas that support the mission of DCE.
Board members requested more about the rollout of the community benefits grant program, which will launch in late spring 2026. Matthew Messina, Director of Client Services for Calpine, will attend the September Board meeting to share more information on the eligibility, timeline, and other aspects of the new grant program.
Fiscal Analysis: There is no cost to DCE for this informational report.
Calpine’s contract for data management and customer call center services costs about $590,000 annually. The new contract includes the two percent rebate for the proposed community benefits grant program, which was not a benefit included in the prior contracts. This is projected to equate to $11,000 or more to non-profit organizations in DCE’s service territory.
Desert Community Energy Board
September 15, 2025
ITEM 7B
STAFF REPORT
Subject: DCE Mid-Term Reliability Procurement: Resource Adequacy + TB8 with Balsam Project LLC
Contact: Lisa McNeilly, Director of Energy & Sustainability ([email protected]) Recommendation: Adopt Resolution No. 2025-06, approving a 15-year Resource Adequacy + TB8 Agreement (RA+TB8) with Balsam Project LLC (Balsam) for its San Bernardino County Battery Energy Storage System (BESS) project and authorizing the Executive Director and/or Legal Counsel to make minor modifications before execution of the agreement
Background: The DCE Board has been investing in several projects as a result of the Request for Proposals (RFP) that DCE’s consultant, The Energy Authority (TEA), first released in July 2024, to satisfy DCE’s Mid-term Reliability (MTR) procurement orders. In December 2024, the Board approved a long-term Power Purchase Agreement with San Gorgonio Westwind II, LLC for its north Palm Springs wind project. The RFP was re-opened on January 24, 2025, for a second round of proposals. Responses to the second round of this RFP were due on February 7, 2025.
In March 2025, the evaluation committee, made up of TEA and DCE staff, screened proposals for completeness and evaluated those offering a four-hour MTR battery (RA+TB4). After scoring them on a weighted criteria basis, DCE staff and TEA identified a short list of three proposed transactions and conducted interviews with the bidders. On June 16, 2025, the DCE Board approved a 15-year Resource Adequacy + TB4 Agreement (RA+TB4) with Athos Storage LLC, for its Riverside County Battery Energy Storage System (BESS) project near Desert Center.
Staff is now recommending the Board authorize a third project from this procurement effort and approve a Resource Adequacy and TB8 Agreement (RA+TB8) with Balsam Project LLC, a subsidiary of Aypa Power. The project is located in San Bernardino County. The Balsam Project will be DCE’s second eight-hour battery contract. An earlier contract with NextEra has been delayed due to network upgrades, and the commercial operation date (COD) has been pushed to 2035 as a result. Balsam will be more cost effective, with a smaller volume sized to better meet DCE’s needs. The Balsam project was screened in June and July 2025 by the same evaluation committee. It was the only short-listed bidder.
California Public Utilities Commission (CPUC) Decisions 21-06-035 from June 2021 and 23-02- 040 from February 2023 set out annual MTR procurement amounts for load-serving entities.
DCE’s MTR procurement needs fall into four categories, with specific directives from the CPUC for each. Once complete, the RA+TB8 Balsam project will fulfill DCE’s general procurement obligations. DCE also has long lead time long duration storage obligations required to be online in 2028, which can be met with projects offering eight-hour MTR battery (RA+TB8).
Much like TB4, TB8 is a standard product that can be traded on the Intercontinental Exchange (ICE) commodity trading platform. RA+TB8 is similar to a traditional Energy Storage Agreement (ESA), but shifts the responsibility of optimizing the battery dispatch for maximum economic benefit from DCE to Balsam as the key difference. A TB8 product refers to batteries that are Desert Community Energy Board
September 15, 2025
discharged when prices are high (“Top”) and charged when prices are low (“Bottom”).The economics of the TB8 component are based on the price spread between the eight highest-priced hours of the day and the eight lowest-priced hours of the day, but Balsam retains any price risk based on their operation of the battery. RA+TB8 contracts are becoming increasingly common with project developers shifting their preference away from traditional ESAs to RA+TB8 structures. The project will also help DCE satisfy its compliance requirements under the CPUC’s Resource Adequacy rules.
The Balsam project is a proposed lithium-ion battery storage facility, and DCE will be contracting for 21 MW /168 MW-hour of the total capacity of the project to meet its long lead time long duration storage MTR obligations. The remaining capacity of the battery storage facility will be contracted to other off-takers. DCE’s portion of the facility can output 21 MW of capacity at eight hours of continuous discharge. The project will be in a heavily industrial area, located 0.4 miles east of the Southern California Edison (SCE) Chino 220 kV substation, with a guaranteed COD of August 1, 2028. It will be a stand-alone storage resource and has established site control through a purchase and sale agreement. Aypa Power has reviewed the project with the City of Chino, and the gen-tie is planned to be run underground in the city right-of-way. No significant issues with permitting have been identified, and the project has received Full Capacity Deliverability Status.
The project site is adjacent to the point of interconnection (POI), and the substation has sufficient capacity to accommodate the proposed project.
Balsam is a Blackstone portfolio company that develops, owns, and operates stand-alone energy storage and hybrid renewables-plus-storage projects across North America. Balsam’s team brings a track record of success in the storage and renewable industries. Together, they have developed, constructed, and brought online more than eight GWs of wind, solar, storage, and natural gas-fired generation projects, including a mix of tolling agreements, conventional PPAs, power hedges, and merchant assets. The project is an example of how DCE can achieve its goals in a cost-effective manner. The project will be built using a project labor agreement, and Balsam will use a six-step community engagement and action plan to build trust and benefit stakeholders.
Balsam is estimated to create 170 construction jobs and eight full-time jobs. Approval of the RA+TB8 will help DCE meet its MTR obligations and reduce price volatility in DCE’s power portfolio, thereby providing for increased rate certainty.
Staff is recommending the Executive Director be authorized to execute the RA+TB8 contract, which was negotiated by TEA and DCE’s legal counsel with continuous input from DCE staff. The recommended action would also authorize the Executive Director and/or Legal Counsel to make clarifying changes prior to execution. The redacted RA+TB8 contract is available for Board review and approval at the link found at the end of this staff report.
Fiscal Analysis: Under the pricing terms in the RA+TB8 agreement, DCE will pay for the use of its portion of the Balsam Storage project at a fixed-price rate per kW-month, with no escalation, for the full 15-year term of the RA+TB8 agreement. DCE is entitled to all product attributes from the facility, including energy and resource adequacy. The RA+TB8 agreement reflects pricing that is cost-effective in the current market for new energy storage resources and is expected to reduce the overall costs for compliance with the CPUC MTR decisions referred to above. As the COD approaches, the energy storage costs will be included in DCE’s budget.
Attachments:
1. Resolution No. 2025-06
2. Project Site Map
3. Link to RA+TB8 agreement: https://desertcommunityenergy.org/wp-content/uploads/2025/09/Aypa-EEI-RATB8-Confirmation-Clean-2025-09-03_Redacted.pdf RESOLUTION NO. 2025-06
A RESOLUTION OF THE BOARD OF DIRECTORS OF DESERT COMMUNITY ENERGY APPROVING A RESOURCE ADEQUACY + TB8 AGREEMENT (RA+TB8) WITH BALSAM
PROJECT LLC
A. Desert Community Energy (“DCE”) is a joint powers authority established on October 30, 2017, for the purpose of implementing community choice aggregation (“CCA”) programs under Public Utilities Code Section 366.2.
B. DCE is required under California Public Utilities Commission (“CPUC”) Mid-Term Reliability procurement requirements, Decisions 21-06-035 and 23-02-040, to procure resources required to be online between 2023 and 2028 to meet electric system reliability needs. To meet the State of California greenhouse gas emissions reduction targets, the CPUC requires all resources procured in satisfaction of its Mid-Term Reliability decisions to be zero-emitting unless they otherwise qualify under renewables portfolio standard eligibility requirements.
C. DCE re-issued a Request for Proposals in February 2025 for projects in satisfaction of the CPUC’s Mid-Term Reliability requirements.
D. DCE has negotiated a Resource Adequacy + TB8 Agreement (RA+TB8) with Balsam Project LLC to meet its Mid-Term Reliability obligations for resource adequacy by securing capacity rights of 21 megawatt / 168 megawatt-hour in a larger proposed lithium-ion battery storage facility with a guaranteed commercial operation date of August 1, 2028.
E. Under Section 2.5.1 of the DCE Joint Powers Agreement, the DCE Board of Directors has the power to make and enter into all contracts, including, but not limited to, service agreements relating to the provision of services necessary to plan, implement, operate and administer the CCA Program and other energy programs including the acquisition of electric power supply and the provision of retail and regulatory support services.
F. DCE staff recommends the approval of the 15-year RA+TB8 Agreement with Balsam Project LLC, and the Board has received information and had a discussion regarding the terms of the agreement.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF DESERT COMMUNITY ENERGY, AS FOLLOWS:
Section 1. Approval of RA+TB8 Agreement. The Board of Directors hereby approves the 15-year RA+TB8 Agreement with Balsam Project, LLC.
Section 2. Delegation to Executive Director. The Board of Directors hereby authorizes the DCE Executive Director to negotiate, finalize, and execute the RA++TB8 Agreement in substantially similar form with any minor modifications before execution of the agreement as approved by Legal Counsel.
Section 3. Resolution Effective Date. This resolution shall take effect immediately upon its adoption.
PASSED AND ADOPTED at a meeting of the Board of Directors of Desert Community Energy held on September 15, 2025.
ATTEST:
________________________ ________________________
Jeffrey Bernstein, Chair Tom Kirk, Secretary
Desert Community Energy Desert Community Energy
AYES: NAYS: ABSENT: ABSTAIN: _
ITEM 7C
STAFF REPORT
Subject: Establishing a New Energy Efficiency Program for DCE Customers Contact: Lisa McNeilly, Director of Energy & Sustainability ([email protected]) and Eman Nazir, Management Analyst ([email protected])
Recommendation: Approve the proposed Energy Efficiency Program Plan for DCE customers and authorize the Executive Director to take the necessary steps to finalize and submit an Elect-to-Administer Tier 3 Advice Letter to the California Public Utilities Commission in support of the approved program plan.
Background: One of DCE’s founding principles is community reinvestment, including investing in local renewable energy sources and energy efficiency programs that benefit local customers.
A separate agenda item provides a preview of a community benefits grant program that was authorized by the Board earlier this year. With this item, staff is recommending the Board support another community reinvestment program and authorize the Executive Director to take the steps necessary to establish a new energy efficiency program for DCE customers.
Section 381.1(e)–(f) of the California Public Utilities Code and California Public Utilities Commission (CPUC) and Decision 14-01-033, Decision Enabling Community Choice Aggregators to Administer Energy Efficiency Programs set forth the requirements for Community Choice Aggregators (CCAs) seeking to administer energy efficiency programs for their own customers. Last year, the CPUC issued D.24-04-007, Decision Granting California Choice Energy Authority’s Petition for Modification of Decision 14-01-033, which further clarifies and refines the procedural and substantive requirements applicable to CCA-administered energy efficiency programs. This builds on the provisions that the Legislature had supported with Assembly Bill 117 in 2002 and Senate Bill 790 in 2011.
Over the summer, DCE staff investigated whether D.24-04-007 would positively impact the viability of DCE submitting an application to Elect To Administer (ETA), since the Decision increased the minimum amount of available funding to CCA programs. This analysis included coordination with two other CCAs who recently submitted Advice Letters and requesting needed data from Southern California Edison. Staff also calculated the cost effectiveness of the proposed program and met with CPUC staff.
DCE staff is now recommending the Board approve the framework of an Energy Efficiency Program Plan and authorize the Executive Director take the necessary steps to request approximately $300,000 in ETA funds to implement DCE’s first self-administered, customer-facing energy efficiency initiative. The Community Energy Savings Program marks a significant organizational milestone. Although DCE has successfully managed core operations since inception, this is the first opportunity to deliver direct services to customers through the stewardship of Public Purpose Program (PPPC) funds. Importantly, this program establishes the foundation for a broader suite of customer programs that the DCE Board had requested over time.
By demonstrating a disciplined program structure — low administrative overhead, significant Desert Community Energy Board
September 15, 2025
administrative in-kind staff contributions, and a strong emphasis on customer benefits —DCE would establish the operational capacity and credibility needed to expand its offerings over time.
ETA programs are funded through the Energy Efficiency portion of Public Purpose Program (PPP) charges and therefore do not require the use of DCE’s operating revenues. Based on staff’s analysis, submitting DCE’s Advice Letter this fall will potentially allow for faster consideration alongside other CCA applications, align program design and rollout with initiatives underway in the City of Palm Springs, and avoid the risk of recalculating the funding determination methodology that relies on the most recent data. With the Board’s authorization, staff would file the ETA application this fall. The submission package will include a finalized Advice Letter and a Program Plan drafted with critical elements required for CPUC certification. Following CPUC approval, staff will return to the Board to present additional refinements to program design and delivery for finalization.
To obtain CPUC certification, an ETA application must demonstrate:
• Board‑approved Program Plan describing how the programs will be implemented; • Funding determination methodology used to calculate the allowed three‑year budget, including (i) utility data collection, (ii) current‑year PPP revenue forecasts, and (iii) the funding approach utilized;
• Cost‑effectiveness meeting or exceeding a Total Resource Cost (TRC) of 1.0 using the CPUC Cost‑Effectiveness Tool (CET);
• Coordination plan with statewide, regional, and local offerings to avoid duplication and customer confusion;
• Evaluation, measurement, and verification (EM&V) protocols; and • Program performance metrics and reporting.
Program Plan Framework
Staff is recommending DCE’s Community Energy Savings Program consists of two complementary components: the small business direct install program and the distribution of free home and business saving kits.
The Small Business Direct Install program involves retrofits of lighting, heating/ air conditioning systems and refrigeration with no upfront‑cost. These retrofits would be delivered by qualified installers for small commercial customers. In the first year, staff hopes the program benefits up to eight businesses. Staff will focus on hard-to-reach shops, strip-mall tenants, restaurants, and convenience stores often overlooked by statewide programs.
The second part of the program allows DCE to distribute free home and business savings kits.
These curated kits will include LED bulbs, faucet aerators, weather‑stripping, smart plugs, efficient showerheads for residential customers, renters, and small businesses. Staff anticipates more than 100 kits could be distributed over three years.
Staff is recommending two initiatives that together balance breadth and depth of impact: the kits provide immediate savings and community engagement, while the direct install retrofits deliver sustained long-term savings. The portfolio has been modeled in the CPUC Cost-Effectiveness Tool (CET) and meets the Commission’s TRC and PAC requirements. It is also designed to prioritize hard-to-reach small businesses, renters, and underserved households that often lack the capital or technical resources to participate in traditional utility programs. By doing so, it advances CPUC equity objectives and aligns with California’s broader energy and climate goals.
However, staff would also note that there are other types of programs, including residential components, that on the surface would qualify for ETA funding. But it is unclear if they would meet the CPUC cost-effectiveness thresholds or other requirements, which the recommended programming does. Should the Board direct staff to revise the program plan or analyze other options, DCE staff would return as soon as October with additional data and research on components that could meet CPUC standards.
With the Board’s authorization, the Executive Director will finalize and submit a Tier 3 Advice Letter and Program Plan in October 2025, following a third-party review to ensure compliance with CPUC guidelines. Approval of the Program Plan, including the Small Business Direct Install initiative and kit distribution, will enable DCE staff to proceed with submittal to the CPUC. Staff will return to the Board after CPUC approval to provide updates and seek input on program delivery details, participation processes, or measure mix to ensure the program remains effective, responsive, and aligned with CPUC guidance.
Fiscal Analysis: The staff support needed to develop the elements of the Tier 3 Advice Letter and Program Plan is covered under existing resources.
DCE staff will be engaging Frontier Energy, who has significant experience in this area, to review and amend the application materials to ensure accuracy. Frontier Energy has worked with four Regional Energy Networks (RENs) and multiple Community Choice Aggregators (CCAs) on their applications to secure similar funding for local governments from the CPUC. Staff from the Coachella Valley Association of Governments (CVAG), which is contracted to staff DCE, is familiar with Frontier Energy’s expertise as they have a role supporting the Inland Regional Energy Network (I-REN) and regional energy efficiency initiatives. DCE’s contract is authorized under the Executive Director’s authority and is not to exceed $15,000. There are available funds in the approved DCE Fiscal Year 2025-26 Budget.
DCE staff anticipates that the ETA funding of approximately $300,000 will cover all program costs.
The draft program budget is structured to maximize direct customer benefits, with more than 85- to-90 percent of funds dedicated to implementation (retrofits and kits), less than four percent to administration, and the remaining funds dedicated to community engagement, outreach and data evaluation. While there are two components to the program, the majority of the implementation funding would be spent on the retrofits.
The ETA funding would be budgeted over three years. First year spending would prioritize toolkit distribution and a controlled direct install rollout to establish visibility and capacity. The second and third years would scale the budgets to support deeper retrofits, expanded participation, and sustained outreach. Marketing remains targeted, ensuring that available funds drive measurable savings, equity outcomes, and long-term community benefit.
ITEM 8A DESERT COMMUNITY ENERGY BOARD
FY2024-2025 ATTENDANCE RECORD
FEB MAR APR MAY JUNE
City of Palm Desert * * * * * * *
City of Palm Springs * * * * * * *
Absent
No Meeting *
Voting Members JUL AUG SEP OCT NOV DEC JAN
ITEM 8B
STAFF REPORT
Subject: Update on General Rate Case
Contact: Alvaro Valcarcel Jervis, Management Analyst ([email protected]) and Claude T. Kilgore, Director of Finance ([email protected]) Recommendation: Information
Background: DCE staff has been working to address several issues related to Southern California Edison (SCE)’s metering, billing practices and customer service, including SCE practices that resulted in customers being retroactively billed for months of usage, even after they paid their regular bill. Many of these issues began surfacing in December 2022 and included delayed meter reading, back-billing, and missing usage. On February 29, 2024, DCE Finance Director Claude Kilgore supplied testimony to the California Public Utilities Commission (CPUC) on behalf of the California Community Choice Association (CalCCA) as part of SCE’s 2025 General Rate Case outlining how errors created by SCE are negatively impacting DCE customers.
On July 28, 2025, the CPUC issued a Proposed Decision (PD) related to SCE’s 2025 General Rate Case. While the PD has no legal effect until it is voted and approved by the Commission, it does include an array of decisions the Administrative Law Judges have determined after hearing arguments from a variety of parties including SCE, CalCCA, members of the public, and other private and public associations. The PD provides fee relief by rejecting SCE’s five-fold increase to the Monthly Account Maintenance Fee (MAMF) and requiring SCE to phase out the EDI-VAN (Data transfer fee for electronic billing communication) charge by 2029. The PD provides some future Oversight by requiring SCE to provide asset-level financial details and follow Pacific Gas and Electric (PG&E)-style testimony requirements in future cases.
As it pertains to back billing, the PD orders SCE to apply Rule 17 billing error limits equally to bundled and unbundled (CCA) customers. Rule 17 limits how far back utilities can “back-bill” customers for errors, which is three months for residential customers and three years for other customer classes.
SCE was found to be back-billing CCA residential customers for charges beyond the three-month allowance. the PD requires the utility to apply the same Rule 17 back-billing limitations to both bundled and unbundled (CCA) service customers. Within 60 days of the final CPUC decision, SCE must host a workshop with intent of developing a proposal on how to address uncollected revenue from the application of Rule 17 back-billing limitations. However, the PD declines CalCCA’s request for immediate shareholder-funded reimbursements for CCA undercollections, instead requiring a workshop and a joint filing to study solutions. Additionally, the PD acknowledges billing error problems but only directs SCE to “continue working with CCAs” and report back in the next GRC, rather than mandating fixes.
The Commission is scheduled to finalize the Decision at its September 18 meeting. DCE staff will update the board if there are significant modifications to the PD.
In November of 2024, DCE also joined three other CCAs in SCE territory to file a complaint at the CPUC. The complaint argued that SCE’s decision to shorten the timeline on which it returns unpaid Desert Community Energy Board
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customer balances to CCAs, from 180 days to 90 days, without further agreement from the Joint CCAs and without providing necessary customer data, violated various Public Utilities Code as well as SCE’s terms of service the Joint CCAs. The week after the complaint was filed, the Joint CCAs began settlement discussions with SCE to attempt to resolve the issues raised. In February 2025, SCE filed with the CPUC denying that its plan to change the unpaid balance return timeline violated any law, CPUC order or other provision or legal obligation to the Joint CCAs. The parties continued to participate in the settlement process in parallel with the activity in the CPUC Complaint docket. In August 2025, staffs from SCE and the Joint CCAs reached an agreement in principle to settle all disputed issues. The settlement represents several significant wins for DCE, especially when combined with the progress highlighted above in the 2025 General Rate Case.
Some key takeaways of the agreement include having SCE implement a 90-day return date for unpaid CCA charges on closed accounts and eliminating rolling returns. The elimination of the rolling returns allows for a fairer opportunity for DCE to have customer payments applied to its balances.
SCE will also hold monthly meetings with the Joint CCAs and its consultant to discuss data quality improvements and track the implementation and validation of solutions on various items that we have been flagging for several years now. SCE will also provide quarterly written reports on data quality issues, solutions, validation status, and proposed follow-up changes.
The settlement also establishes that, by the end of the third quarter of 2026, SCE will change its rebill process to only reverse specific charges and payments being corrected, rather than all charges and payments from the date of correction, with limited exceptions. Finally, SCE will provide additional account information, including personal information, to the Joint CCAs for pursuing collections of unpaid customer balances. SCE will work with the Joint CCAs to agree on reimbursement for the costs incurred to implement the new Personal Information report. The CCAs will have the ability to cancel this portion of the agreement if the costs end up outweighing the benefits of receiving the information.
DCE staff will continue to update the Board on efforts to advocate for its customers and ensure fair and transparent billing practices.
Fiscal Analysis: There is cost to DCE for this informational update.
The Proposed Decision will positively impact DCE in that the MAMF is being maintained at current rates instead of increasing by a factor of five as originally proposed in SCE’s 2025 General Rate Case application. While no definitive outcome was established for reimbursement of revenue to CCAs due to SCE’s Rule 17 back-billing limitations, the CCAs, including DCE, will have an opportunity to address this through development of a proposal on the appropriate funding mechanism from SCE for these uncollected revenues.
The settlement between SCE and the Joint CCAs will eliminate rolling returns, allowing DCE better opportunity to apply customer payments to DCE balances. The data quality improvements will eventually reduce staff time spent on such matters, the rebill process will increase interest earned overnight as funds will no longer be withdrawn from DCE accounts and if DCE ends up receiving Personal Information, DCE may be able to collect on aged accounts it previously has not.
Attachments:
1. Link to PROPOSED DECISION OF ALJ RIZZO AND ALJ SEYBERT -Decision on test year 2025 General Rate Case for Southern California Edison Company
2. Link to Joint CCA Settlement Agreement from CPUC Docket, as found under documents tab Desert Community Energy
Unaudited Statement of Net Position Prev Year Comparison As of June 30, 2025
Jun 30, 25 Jun 30, 24 $ Change % Change
ASSETS
Current Assets
Checking/Savings
1100 · Unrestricted Funds
1103 · CAMP Account 15,999,412 14,285,262 1,714,150 12.00% 1104 · LAIF Account 6,523,044 6,468,000 55,044 0.85%
1105 · Operating Account -8099 198,284 199,749 (1,465) (0.73%) 1109 · DDM Marketplace Sweep - 0991 4,106,194 2,192,066 1,914,128 87.32% 1115 · Lockbox -4446 3,844,466 2,331,818 1,512,649 64.87% Total 1100 · Unrestricted Funds 30,671,401 25,476,895 5,194,506 20.39% 1145 · Fair Value Adjustment 7,817 (23,828) 31,644 132.81% 1199 · Restricted Funds
1110 · Money Market -5470 405,750 405,748 2 0.0%
1120 · FSR Letter of Credit Collateral 147,000 147,000 - 0.0% Total 1199 · Restricted Funds 552,750 552,748 2 0.0%
Total Checking/Savings 31,231,967 26,005,815 5,226,152 20.1% Accounts Receivable
1221 · Accounts Receivable 12,195,815 12,696,642 (500,827) (3.95%) 1223 · Accrued Accounts Receivable 4,802,386 4,566,596 235,790 5.16% 1250 · Interest Receivable 71,467 2,410 69,057 2,865.67% Total Accounts Receivable 17,069,668 17,265,648 (195,981) (1.14%) Other Current Assets
1225 · Allowance for Doubtful Accounts (1,495,288) (1,188,680) (306,608) (25.79%) 1240 · Prepaid Expenses 1,610,186 4,146,989 (2,536,802) (61.17%) Total Other Current Assets 114,899 2,958,309 (2,843,410) (96.12%) Total Current Assets 48,416,534 46,229,772 2,186,761 4.73% Other Assets
1170 · Deposits/Bonds 1,010,584 710,584 300,000 42.22%
Total Other Assets 1,010,584 710,584 300,000 42.22%
TOTAL ASSETS 49,427,118 46,940,356 2,486,761 5.3%
LIABILITIES & NET POSITION
Liabilities
Current Liabilities
Accounts Payable
2110 · Accounts Payable 7,956,110 7,302,486 653,624 8.95% 2112 · Accrued Accounts Payable 960,974 3,023,098 (2,062,123) (68.21%) 2120 · Due to Other Governments 584,064 750,167 (166,103) (22.14%) Total Accounts Payable 9,501,148 11,075,751 (1,574,603) (14.22%) Other Current Liabilities
2115 · NEM Escrow Account 91,492 54,115 37,377 69.07%
2230 · Taxes payable
2231 · Utility Users Tax (UUT) 194,963 212,411 (17,448) (8.21%) 2232 · Electric Energy Surcharge 6,119 6,300 (180) (2.86%) Total 2230 · Taxes payable 201,083 218,711 (17,628) (8.06%) Total Other Current Liabilities 292,575 272,826 19,749 7.24% Total Current Liabilities 9,793,723 11,348,577 (1,554,854) (13.7%) Long Term Liabilities
2260 · Vendor Security Deposits
2262 · PPA Development Security 225,000 225,000 - 0.0%
2263 · Contract Development Deposit 180,000 180,000 - 0.0% Total 2260 · Vendor Security Deposits 405,000 405,000 - 0.0% Total Long Term Liabilities 405,000 405,000 - 0.0%
Total Liabilities 10,198,723 11,753,577 (1,554,854) (13.23%) Net Position
31000 · Restricted Net Position 147,000 147,000 - 0.0%
32000 · Unrestricted Net Position 35,039,779 19,167,378 15,872,401 82.81% Net Revenue 4,041,615 1 15,872,401 (11,830,786) (74.54%) Total Net Position 39,228,395 35,186,779 4,041,615 11.49% TOTAL LIABILITIES & NET POSITION 49,427,118 46,940,356 2,486,761 5.3%
Desert Community Energy
Unaudited Statement of Net Position Prev Year Comparison As of June 30, 2025
1 The variance is primarily driven by significantly higher actualized costs compared to the prior year, particularly in the resource adequacy and renewable energy markets. DCE is also awaiting final calendar year 2025 Market Price Benchmarks to be approved by the CPUC in October 2025 which may decrease or increase costs for certain renewable energy products and subsequently affect Net Revenue.
Desert Community Energy
Unaudited Changes to Net Position Budget vs. Actual
July 2024 through June 2025
Jul '24 - Jun 25 Budget 1 $ Over Budget
Ordinary Revenue/Expense
Revenue
5010 · Electricity Sales 64,841,491 2 (3,593,173) 68,434,664 5100 · Other Revenue 2,615,874 7,026,346 4,410,472
Total Revenue 71,050,538 71,867,837 817,299
Expense
4100 · Cost of Electricity
4105 · Electricity Purchase 24,987,954 25,451,789 463,835 4110 · Resource Adequacy Settlement 21,205,840 20,090,242 (1,115,598) 4115 · Carbon Free Settlement 4,916,358 4,916,358 -
4120 · Renewable Energy Cr. Settlement 6,573,036 3 2,032,978 4,540,058 4125 · Market Charges 5,592,255 5,480,857 (111,398)
4175 · CPUC YARA Penalty 1,750,159 1,750,159 0
Total 4100 · Cost of Electricity 62,992,624 64,262,441 1,269,817 4200 · Accounting / Bank Services 53,179 69,036 15,857
4353 · Insurance 8,462 8,044 (418)
4423 · Office Supplies 1,600 2,415 815
4425 · Legal Services 92,117 100,782 8,665
4431 · Professional Services 260,021 167,171 (92,850)
4432 · Consultants 2,414,674 2,429,101 14,426
4433 · Outreach Services 29,154 22,738 (6,416)
4435 · Technology Costs (IT) 6,229 6,007 (222)
4440 · Postage 14,516 12,287 (2,229)
4441 · Printing 11,757 10,216 (1,541)
4452 · Marketing 12,653 4,462 (8,191)
4455 · Customer Programs (15,804) 4 (92,432) 76,628
4500 · Registrations/Memberships 196,290 87,580 (108,710) 4750 · Bad Debt Expense 2,020,149 1,777,213 (242,936)
Total Expense 68,190,052 68,943,687 753,635
Net Ordinary Revenue 2,860,486 2,924,150 63,664
Other Revenue/Expense
Other Revenue
5900 · Investment Revenue 900,000 1,085,821 185,821
5925 · Gain/(Loss) in Investments 31,644 31,644
Total Other Revenue 900,000 1,117,465 217,465
Other Expense - - -
Total Other Expense - - -
Net Other Revenue 900,000 1,117,465 217,465
Net Revenue 4,041,615 3,760,486 281,129
Desert Community Energy
Unaudited Changes to Net Position Budget vs. Actual
July 2024 through June 2025
1 2
3 4
Costs for renewable products increased from budgted amounts. DCE is also awaiting final calendar year 2025 Market Price Benchmarks to be approved by the CPUC in October 2025 which adjust certain costs upward or downward. In addition, a contractual sale of renewable energy from DCE's portfolio was inadvertently budgeted as a negative expense of about $3.8 million which was realized as revenue to DCE expected in the third quarter of fiscal year 24-25.
On March 17, 2025, the Desert Community Energy Board adopted the Fiscal Year 2024–25 Budget Amendment. The budget column presented herein reflects the amended budget as approved by the Board.
DCE’s actual retail loads were lower than the budgeted forecasts.
The credit balance in customer program reflects a prior-year over-accrual of Bill Protection Program costs for terminated accounts. In the current year, payments were issued only for balances exceeding $50, resulting in lower actual disbursements than accrued.
Desert Community Energy
Unaudited Changes to Net Position Prev Year Comparison
July 2024 through June 2025
Jul '24 - Jun 25 Jul '23 - Jun 24 $ Change % Change
Ordinary Revenue/Expense
Revenue
5010 · Electricity Sales 64,841,491 70,414,492 (5,573,001) (7.92%) 5100 · Other Revenue 7,026,346 931,854 6,094,492 654.02% Total Revenue 71,867,837 71,346,347 521,490 0.73%
Expense
4100 · Cost of Electricity
4105 · Electricity Purchase 25,451,789 34,089,369 (8,637,580) (25.34%) 4110 · Resource Adequacy Settlement 20,090,242 1 11,524,691 8,565,550 74.32% 4115 · Carbon Free Settlement 4,916,358 454,892 4,461,466 980.78% 4120 · Renewable Energy Cr. Settlement 6,573,036 - 6,573,036 100.0% 4125 · Market Charges 5,480,857 4,731,525 749,332 15.84% 4175 · CPUC YARA Penalty 1,750,159 650,105 1,100,054 169.21% Total 4100 · Cost of Electricity 64,262,441 51,450,582 12,811,859 24.9% 4200 · Accounting / Bank Services 69,036 3 1,858 67,178 3,615.46% 4353 · Insurance 8,044 8,589 (545) (6.34%)
4423 · Office Supplies 2,415 1,375 1,040 75.64%
4425 · Legal Services 100,782 159,803 (59,021) (36.93%) 4431 · Professional Services 167,171 196,095 (28,924) (14.75%) 4432 · Consultants 2,429,101 2,231,845 197,255 8.84%
4433 · Outreach Services 22,738 28,770 (6,032) (20.97%) 4435 · Technology Costs (IT) 6,007 5,625 381 6.78%
4440 · Postage 12,287 15,332 (3,045) (19.86%)
4441 · Printing 10,216 12,448 (2,232) (17.93%)
4452 · Marketing 4,462 4,239 224 5.27%
4455 · Customer Programs (15,804) 4 104,103 (119,907) (115.18%) 4500 · Registrations/Memberships 87,580 95,069 (7,489) (7.88%) 4750 · Bad Debt Expense 1,777,213 1,646,074 131,139 7.97% Total Expense 68,943,687 55,961,807 12,981,880 23.2%
Net Ordinary Revenue 2,924,150 15,384,540 (12,460,390) (80.99%) Other Revenue/Expense
Other Revenue
5900 · Investment Revenue 1,085,821 512,903 572,918 111.7% 5925 · Gain/(Loss) in Investments 31,644 (23,828) 55,472 232.81% Total Other Revenue 1,117,465 489,075 628,390 128.49%
Other Expense
4610 · Interest Expense - 1,214 (1,214) (100.0%)
Total Other Expense - 1,214 (1,214) (100.0%)
Net Other Revenue 1,117,465 487,861 629,604 129.05%
Net Revenue 4,041,615 15,872,401 (11,830,786) (74.54%)
1 3
2 4
The credit balance in customer program reflects a prior-year over-accrual of Bill Protection Program costs for terminated accounts. In the current year, payments were issued only for balances exceeding $50, resulting in lower actual disbursements than accrued.
Accounting/bank service costs increased significantly from the prior year primarily due to revolving credit renewal expenses incurred in the current year.
Costs for resource adequacy products have increased significantly in fiscal year 2024-25. This is coupled with DCE's need to procure additional products in an effort to achieve compliance with CPUC regulations. DCE is also awaiting final calendar year 2025 Market Price Benchmarks to be approved by the CPUC in October 2025 which may adjust certain costs upward or downward.
2 Costs for renewable products increased significantly in fiscal year 2024-25 in addition to DCE procuring more products to be compliant with California Renewable Portfolio Standards and meet its Carbon Free objectives. DCE is also awaiting final calendar year 2025 Market Price Benchmarks to be approved by the CPUC in October 2025 which may adjust certain costs upward or downward.
Carrying % of Fair Market % of Annual
Description Amount Total Value Total %age Yield
CASH AND INVESTMENTS UNDER THE DIRECTION OF DCE
River City Bank - Operating 198,284 $ 0.64% 198,284 $ 0.63% N/A River City Bank - DDM Marketplace Sweep 4,106,194 $ 13.15% 4,106,194 $ 13.15% 4.36% River City Bank - Lockbox 3,844,466 $ 12.31% 3,844,466 $ 12.31% N/A River City Bank - Money Market 405,750 $ 1.30% 405,750 $ 1.30% 2.28% River City Bank - Stand-by FSR Letter of Credit 147,000 $ 0.47% 147,000 $ 0.47% N/A Local Agency Investment Fund (LAIF) 6,523,044 $ 20.89% 6,530,861 $ 20.91% 4.40% CAMP 15,999,412 $ 51.24% 15,999,412 $ 51.23% 4.43%
Overall Total $ 100.00% 31,231,967 31,224,151 $ 100.00% Duly submitted by:
Claude T. Kilgore, CPA
Director of Finance
DESERT COMMUNITY ENERGY
INVESTMENT REPORT
FOR JUNE 30, 2025
[a] Source of Market Values - LAIF, State of California Pooled Money Investment Account Market Valuation - June 2025. Paper Gain/(Loss) was 0.120%. Fair market value includes accrued interest.
DCE's investment portfolio demonstrates its ability to fully sustain its expenditure requirements for at least the next six months and beyond including all liquidity requirements for the foreseeable future.