Presentation — WestLight Energy Board of Directors, January 18, 2022

Peninsula Clean Energy
Special Board of Directors Meeting
January 18, 2022
Peninsula Clean Energy
Special Agenda
• Call to Order / Roll Call
• Public Comment (for items not on the Agenda)
• Action to set the Agenda
• Regular Agenda
oAgenda Item 1 – CC Power
Approval of Resolutions
Related to CC Power
Special Board Meeting
Siobhan Doherty, Director of Power Resources
January 18, 2022
Peninsula Clean Energy
Recommendation

1. Approve Resolution directing the Chief Executive Officer to vote as a director on the California Community Power (CC Power) Board to approve the Energy Storage Services Agreement between California Community Power and Tumbleweed Energy Storage, LLC and any necessary ancillary documents for a long duration energy storage (LDS) project with a delivery term of 15 years starting at the Commercial Operation Date on or about June 1, 2026

2. Approve Resolution Delegating Authority to Chief Executive Officer to Execute on behalf of Peninsula Clean Energy as a member of CC Power the following agreements and any necessary ancillary documents for the LDS project with a delivery term of 15 years starting at the Commercial Operation Date on or about June 1, 2026, in an amount not to exceed $100 million:
o Project Participation Share Agreement between Peninsula Clean Energy, California Community Power and other participating CCAs
o Buyer Liability Pass Through Agreement between Peninsula Clean Energy Authority, California Community Power and Tumbleweed Energy Storage, LLC 4 Peninsula Clean Energy
Agenda

1. Background

2. LDS Need – Mid-term Reliability Procurement Mandate

3. Contract Structure

4. Tumbleweed Project

5. Recommendation
5 Background
Peninsula Clean Energy
RFO Background and Timeline
7 Jun 2020
• Interest and Information Gathering (RFI) for Long Duration Storage (LDS) Oct 2020
• CCAs issue a joint Request for Offers (RFO) for up to 500 MW of LDS Feb 2021
• California Community Power (CC Power) Formed / LDS Project Oversight Committee (POC) formalized
Jun 2021
• LDS Projects shortlisted, Energy Storage Service Agreement (ESSA) Negotiations start, and begin development of CC Power / CCA Agreements
Jun 2021
• CPUC issues Mid-term Reliability Procurement Order
Oct 2021
• Start CC Power and Individual CCA Approval processes for LDS Project #1 - Tumbleweed Jan 2022
• Peninsula Clean Energy Board approval for Tumbleweed
• CC Power Board approval for Tumbleweed
Feb – Mar
2022
• Other CCAs Board Approvals
Peninsula Clean Energy
Participating CCAs
8 • 7 CCAs are participating in this joint procurement effort LDS Need – Mid-term
Reliability Procurement
Mandate
Peninsula Clean Energy
Mid-Term Reliability Decision (2023 – 2026)
• D.21-06-035 adopted by CPUC on June 24, 2021, to address mid-term reliability needs • LSEs required to collectively procure 11,500 MW of new resources • Allocated to LSEs by load share
• Resources must be zero-emission or RPS eligible (no fossil resources)
• 4,500 MW of obligation subject to specific category requirements (next slide)
10 Peninsula Clean Energy
Peninsula Clean Energy Allocation
11 Procurement Category 2023 2024 2025 2026 Total
Zero-emissions generation, generation paired with storage, or demand response resources2 - - 47 - 47
Firm zero-emitting resources3 - - - 19 19
Long-duration storage resources3, 4 - - - 19 19
Remaining New Capacity Required - - - - 132
Total Annual Net Qualifying Capacity (NQC) Requirements 38 113 28 38 217

1. Obligation is in NQC MW (not nameplate) and subject to ELCC factor

2. Zero-emissions resources required to replace Diablo Canyon must be procured by 2025 but may occur in any of the years 2023-2025; therefore, the columns do not add to the total.

3. LSEs may request an extension by February 1, 2023, up to 2028 for the LLT resources.

4. 4. Minimum 8-hour discharge
Procurement Obligation in NQC1 MW for Peninsula Clean Energy by Category and Year Peninsula Clean Energy
Effective Load Carrying Capacity Factors
12 • Requirements are based on Net Qualifying Capacity
• Long duration storage assigned an NQC of 78.2%
• Each MW of nameplate capacity = .782 MW NQC
Peninsula Clean Energy NQC
Allocation
Nameplate Equivalent
19 MW 24.30 MW
Contract Structure
Peninsula Clean Energy
Typical CCA Contracting
14 Developer 1 CCA
Energy Storage Services Agreement
LDS Project CCA Customers
Typically, a CCA will procure storage services on behalf of its customers by directly entering into an Energy Storage Services Agreement (ESSA) with a developer. The ESSA addresses (1) payment obligations, (2) liability for damages, and (3) operational control of the storage unit.

Peninsula Clean Energy
Project Participation Share Agreement
15 Developer CC Power
Energy Storage Services Agreement
CC Power 7 CCAs
Project Participation Share Agreement
LDS Project CCA Customers
Peninsula Clean Energy
Liability for Damages
16 Developer CC Power
Energy Storage Services Agreement
CC Power 7 CCAs
Project Participation Share Agreement
LDS Project CCA Customers
Buyer Liability Pass Through
Agreement
(Each participating CCA executes with Developer’s Seller entity and CC Power) Operating Agreement
Buyer Liability Pass Through Agreements
Peninsula Clean Energy
Operational Control
17 Developer CC Power
Energy Storage Services Agreement
CC Power 7 CCAs
Project Participation Share Agreement
LDS Project CCA Customers
Buyer Liability Pass Through
Agreement
(Each participating CCA executes with Developer’s Seller entity and CC Power) Buyer Liability Pass Through Agreements
Operations Agreement
Scheduling
Coordinator
Agreement
Tumbleweed Project
Peninsula Clean Energy
LS Power Tumbleweed • Developer – REV Renewables / LS
Power
• Location – Kern County, CA (in
CAISO)
• Product – Full Toll, w/RA and A/S
rights
• Capacity/Technology – 69 MW Li-ion
(NMC/LFP) contract w/Full Capacity
Deliverability Status
• COD/Term – 6/1/2026, 15 years
• Discharge Duration – 8 hours
19 Peninsula Clean Energy
Environmental Review
• Staff worked with several environmental non-profits to develop a system for evaluating the environmental impact of projects. Staff studied the geospatial footprint of the project to evaluate whether the project is located in a restricted or high conflict area for renewable energy development:
o Protected areas at the federal, state, regional, local level (e.g. County-designated conservation areas, BLM Areas of Critical Environmental Concern, critical habitat for listed species, national, state, county parks, etc.).
o Identified and mapped important habitat and habitat linkages, especially for threatened and endangered species (either state or federally listed).
• For this project, the analysis showed that the project was not located in a protected area based on the USGS Protected Areas Database (PAD-US) or in an area not suitable for renewable energy development as identified by the Renewable Energy Transmission Initiative (RETI).

USGS PAD-US: https://www.usgs.gov/core-science-systems/science-analytics-and-synthesis/gap/science/protected-areas RETI: https://reti.databasin.org/
20 Peninsula Clean Energy
Tumbleweed Shares
21 CCA

CPUC PD
Capacity
Obligation MW
NQC in 2026
Entitlement
Share
Tumbleweed
Allocation (MW)
CPSF 15.5 16.06% 11.08
PCE 19 19.69% 13.59
RCEA 3.5 3.62% 2.50
SJCE 21.5 22.28% 15.37
SVCE 20.5 21.25% 14.66
SCPA 12.5 12.95% 8.94
VCE 4 4.15% 2.86
Total 96.5 100.00% 69
• Project Capacity was allocated based on CPUC obligation Peninsula Clean Energy
ESSA Contract Structure
• Pay for the use of the storage project of the project at a fixed-price rate per kW-month • No escalation
• Contract term: 15 years
• CC power is entitled to all product attributes from the facility:
o Energy Arbitrage
o Ancillary services
o Resource adequacy.
22 Peninsula Clean Energy
Contract Details – Credit / Collateral
23 • Buyer’s Liability Pass Through Agreement (BLPTA)
• Executed by CCA, Developer and CC Power
• Each CCA guarantees payment performance of CC Power under ESSA • No LCs or cash collateral required
• Project Participation Agreement
• 25% step-up cap – Each CCA commits to take up to 25% additional capacity if another CCA defaults
• 3 months payment obligation posting per CCA to CC Power Peninsula Clean Energy
Workforce Requirements
All construction work shall
• Comply with CA prevailing wage requirements
• Be conducted using a project labor agreement, community workforce agreement, work site agreement, collective bargaining agreement, or similar agreement providing for terms and conditions of employment with applicable labor organizations
24 Peninsula Clean Energy
Environmental and Environmental Justice
Requirements
• Seller required to obtain and maintain all permits and approvals requires
• Seller represents and warrants that it has not and will not knowingly utilize equipment or resources that rely on work or services exacted from any person under the threat of a penalty and for which the person has not offered himself or herself voluntarily 25 Peninsula Clean Energy
Board Authorization MW
26 • Each CCA is seeking authority to procure a maximum amount of MW to cover:
• Contingency should not all CCA's gain board authority; and • 25% step-up per PPSA
• Peninsula Clean Energy is sizing its requested authorization to its total LDS requirement
Peninsula Clean Energy NQC
Allocation
Nameplate Equivalent
19 MW 24.30 MW
Recommendation and
Approval
Peninsula Clean Energy
Recommendation

Appendix
Peninsula Clean Energy
Mid-Term Reliability Decision (2023 – 2026)
• D.21-06-035 adopted by CPUC on June 24, 2021, to address mid-term reliability needs
• LSEs required to collectively procure 11,500 MW of new resources o Measured in net qualifying capacity not nameplate capacity • Follow-on to November 7, 2019, CPUC decision mandating 3,300 MW procurement for 2021-2023 to maintain reliability
• Contract of at least 10 years
• Allocated to LSEs by load share
• Resources must be zero-emission or RPS eligible (no fossil resources) • 4,500 MW of obligation subject to specific category requirements (next slide) 31 Peninsula Clean Energy
Procurement Timing
32 • Timing of overall procurement requirement and specific categories assigned in tranches between 2023 and 2026
Procurement Category 2023 2024 2025 2026 Total
Zero-emissions generation, generation paired with storage, or demand response resources2 - - 2,500 - 2,500
Firm zero-emitting resources3 - - - 1,000 1,000
Long-duration storage resources3, 4 - - - 1,000 1,000
Remaining New Capacity Required - - 7,000
Total Annual Net Qualifying Capacity (NQC) Requirements 2,000 6,000 1,500 2,000 11,500

1. Obligation is in NQC MW (not nameplate) and subject to ELCC factor

2. Zero-emissions resources required to replace Diablo Canyon must be procured by 2025 but may occur in any of the years 2023-2025; therefore, the columns do not add to the total.

3. LSEs may request an extension by February 1, 2023, up to 2028 for the LLT resources.

4. 4. Minimum 8-hour discharge
Procurement Obligation in NQC1 MW for All LSEs by Category and Year Peninsula Clean Energy
Penalties for Non-Compliance
• If an LSE fails to meet its procurement obligations, “penalties” may be imposed • IOUs will be ordered to backstop with costs assigned to LSE and/or its customers based on a methodology to be determined
• LSE will be subject to on-going financial penalties per MW not procured until deficiency is cured.
• Also possible, but currently unclear, if existing (or new) RA compliance penalties and CAISO backstop procurement would be applicable.
33 Peninsula Clean Energy
CC Power Tumbleweed Approval Process
34 Step 1: CC Power Board issues 60-day notice to consider ESSA for approval in December - Today Step 2: CC Power Board approves ESSA, PPSA, BLPTA & Operating Agreement condition on individual CCA Approval Step 3: CCAs seek respective Board Approvals of PPSA, BLPTA and Operating Agreement  Step 4: Tumbleweed Agreements become effective
CC Power Board
issues 60-day notice
to consider ESSA for
approval in
December
Finalize
Tumbleweed ESSA
and CC Power/CCA
Supporting
Agreements
CC Power Approves
LS Power
Tumbleweed
Participating CCAs
Approve
Participation
Agreements
ESSA with LS
Power Tumbleweed
Process will be repeated for additional LDS Project Agreements – condition on negotiations and interest from other CCAs
October November - December January 19 January – March 2022 Step 1  Step 2 Step 3 Step 4
Peninsula Clean Energy
Contracting Through CC Power
35 Developer
Energy Storage Services Agreement
CC Power
LDS Project CCA Customers
Peninsula Clean Energy
Overall Structure
36 Developer CC Power
Energy Storage Services Agreement
CC Power 7 CCAs
Project Participation Share Agreement
LDS Project CCA Customers
Buyer Liability Pass Through
Agreement
(Each participating CCA executes with Developer’s Seller entity and CC Power) Buyer Liability Pass Through Agreements
Operations Agreement Scheduling
Coordinator
Agreement
Peninsula Clean Energy
Project Owner – REV Renewables
• A subsidiary of LS Power
• LS Power was founded in 1990
o Developed more than 660 miles of high voltage transmission, o Developed, constructed, managed, or acquired more than 45,000 MW of power generation, including utility-scale solar, wind, hydro, natural gas-fired and battery energy storage projects. o Actively invests in distributed energy resources including CPower Energy Management, Endurant Energy, EVgo and Rise Light & Power, as well as renewable fuels. • LS Power formed REV Renewables to accelerate investment in renewable energy and storage technologies.
• REV owns 1.9 GW of operating energy storage across the U.S. including 600MW of operating battery energy storage.
• REV has an additional 1.3 GW of battery energy storage in development. 37 Adjournment
Peninsula Clean Energy

WestLight Energy Board of DirectorsJanuary 18, 2022

WestLight Energy Board of Directors
January 18, 2022