Peninsula Clean Energy
Board of Directors Meeting
May 26, 2022
Peninsula Clean Energy
Agenda
• Call to Order / Roll Call
• Public Comment (for items not on the Agenda)
• Action to set the Agenda and Approve Consent Items 1-7 o Consent - Public Comment
• Regular Agenda
• Adjournment
Chair Report (Discussion)
May 26, 2022
CEO Report (Discussion)
May 26, 2022
Peninsula Clean Energy
Staffing Updates
• Posted Positions:
o CFO
o EV Associate Programs Manager
o Power Resources Manager
o Renewable Energy Analyst
Peninsula Clean Energy
Presentations / Meet and Greet’s
• May 9 – Presentation on 24/7 at World
Resources Institute Webinar
• May 12 – Meeting with CEC Chair David
Hochschild
• May 23 – Follow up meeting with CPUC
Commissioner Cliff Rechshtaffen
6 Peninsula Clean Energy
Legislative Activities Update
7 • AB 1944 (Lee and C. Garcia) was heard on May 4 in the Assembly Committee on Local Government and passed that committee. It is now headed to the floor of the state Assembly for consideration.
• SB 881 (Min) was placed on the Suspense Calendar and then held by the Senate Committee on Appropriations. This bill will not move forward in 2022. • SB 887 (Becker) reached the floor of the state Senate where it passed this week.
It is now headed to the state Assembly for consideration. • SB 1020 (Laird, Caballero, Durazo, Atkins) was passed in the Senate Energy Committee and the Senate Committee on Appropriations. It is scheduled for a floor vote in the state Senate during the week of May 23.
Peninsula Clean Energy
• SB 1112 (Becker) passed in the Senate Energy Committee and the Senate Committee on Appropriations. It was considered by the full state Senate and passed earlier this week. • SB 1158 (Becker) passed in the Senate Energy Committee and then referred to the Senate Committee on Appropriations where it was placed on the Suspense Calendar. The committed voted it off the Suspense Calendar. It was voted upon and passed off the floor of the full Senate. • SB 1203 (Becker) passed in the Senate Environmental Quality Committee. Peninsula Clean Energy submitted a letter of support for the bill and spoke in favor at the hearing. The Senate Committee on Appropriations then sent the bill to the full Senate for consideration, where it was voted upon and passed this week..
• SB 1393 (Archuleta) passed in the Senate Governance and Finance Committee on April 20. It was referred to the Senate Committee on Appropriations for further consideration. The bill was passed by Senate Appropriations, but further amended at that time. It will next be considered by the full Senate.
8 Legislative Activities Update
Peninsula Clean Energy
Upcoming Meetings
• Citizens Advisory Committee:
o June 9 at 6:30 p.m. (Zoom)
• Audit & Finance Committee:
o June 13 at 8:30 a.m. (Zoom)
• Executive Committee:
o June 13 at 10:00 a.m. (Zoom)
• Board of Directors:
o June 23 at 6:30 p.m. (Zoom)
CAC Report (Discussion)
May 26, 2022
Recognition of Peninsula Clean Energy’s
Fifth Anniversary of Service to San Mateo
County (Discussion)
May 26, 2022
Resolution to Honor Members of the
Citizens Advisory Committee (CAC)
(Action)
May 26, 2022
Peninsula Clean Energy
Honoring Recent CAC Members
Tim Bussiek
• Advocated for PCE to set decarbonization of San Mateo County by 2035 goal Morgan Chaknova
• Drafted the Citizens Advisory Committee’s original work plan template in 2020 • Supported CAC work plan creation in 2021 and 2022
• Served as Vice-Chair and then Chair of the CAC in 2021 and into 2022 Janet Creech
• Spearheaded a grassroots group supporting the creation of PCE • Played a leading role in the creation of PCE’s programs to support schools • Volunteered significant hours to develop Peninsula Clean Energy’s energy education resources
Peninsula Clean Energy
Honoring Recent CAC Members (cont’d)
Terri Givens
• Offered PCE her deep professional expertise on Diversity, Equity, Accessibility, and Inclusion (DEAI)
• Drafted the CAC’s Equity Statement in 2020
Ray Larios
• Supported PCE in outreach to San Mateo County’s Latinx community • Volunteered at bilingual events throughout the County • Served as CAC Chair in 2021
Alex Melendrez
• Expanded PCE reach to San Mateo County’s young Latinx community • Promoted our program offerings through personal social media • Helped connect PCE with San Mateo County’s affordable housing community Approval of New Citizens Advisory
Committee (CAC) Members (Action)
May 26, 2022
Peninsula Clean Energy
CAC Openings
Total of 8 openings on the CAC
4 CAC members had terms expiring in May 2022
• Two requested re-appointment for another term:
o Jason Mendelson
o Steven Booker
4 additional vacancies from members who stepped off in the past year
Peninsula Clean Energy
CAC Nomination Process
• Members terming off can request re-appointment by submitting a letter • Open application posted on PCE website
• 12 complete applications received
• All 12 applicants interviewed by a Board subcommittee in April 2022 o All applicants were highly qualified
o Diversity in perspectives and geographic balance were considered o Following applicants recommended for appointment
Peninsula Clean Energy
Candidates Nominated for Appointment
Term Name City Selected Background
Renewed Term Steven Booker Half Moon Bay
Political Director and Community Affairs Liaison with IBEW 617. A former electrician for 20+ years, working with Building Management Systems to reduce energy consumption.
Renewed Term Jason
Mendelson Redwood City
Active in developing Woodside’s Climate Action plan and city sustainability ordinances, organizing Earth Day celebrations in Portola Valley/Woodside, owns TV and film production studio.
New Term Brandon Chan South San
Francisco
Current member of Community Advisory Committee General Plan 2040 for City of South San Francisco. Interested in supporting the electrification of existing buildings equitably.
New Term Kathleen
Goforth San Carlos
Brings experience from a career with the U.S. Environmental Protection Agency and volunteer work with local environmental organizations. Passionate about public education on building electrification and reach codes.
Peninsula Clean Energy
Candidates Nominated for Appointment (cont’d)
Term Name City Selected Background
New Term Michael Garvey San Carlos
Led various energy and energy efficiency efforts through a career in local government, including as City Manager of San Carlos.
Vision is to increase education around electrification programs.
New Term Margaret Li South San
Francisco
Environmental engineer with the San Francisco Public Utilities Commission. Enthusiastic about contributing to community through local environmental advocacy.
New Term Ed Love Half Moon Bay
Architect with experience in design and construction. Interested in programs for electrifying homes, including new technologies and pilots such as Harvest Thermal.
New Term Bryan Tran South San
Francisco
Passionate about community service and addressing the rising cost of energy for households. Former member of the YMCA Urban Services Philanthropy Board and mentor for at-risk youth.
Approval of 2022 Citizens Advisory
Committee Workplan (Action)
May 26, 2022
Peninsula Clean Energy
CAC Role and Responsibilities
• Act as liaison to community
• Provide feedback on PCE policy and operational objectives • Engage in outreach to community, including encouraging ratepayers to participate in PCE offerings and programs, and implement other carbon reducing practices • Assist with legislative advocacy in conjunction with staff and board • Provide an initial forum for community discussions on wide variety of strategies to reduce carbon emissions in conjunction with staff and board New: Support PCE in strategic initiatives, such as the Diversity, Equity, Accessibility, and Inclusion (DEAI) project
Peninsula Clean Energy
CAC Work Planning
oAd hoc working groups focus on specific projects with PCE staff o2021 CAC working group deliverables included in agenda packet o2022 working group projects suggested by both staff and CAC members, reviewed by PCE Executive Committee
Work Plan Guiding Principles
● Ensure PCE Staff and Board understand how to leverage CAC in a way that is useful and drives PCE strategic priorities
● Ensure CAC members feel fully engaged and utilized if they have interest and bandwidth
● Maximize efficiency of CAC impact on staff resources
Peninsula Clean Energy
Proposed 2022 CAC Working Groups
Project Proposed Task Description and Deliverables Staff Liaison
1. Home Upgrade Program Review data and results from the first completed homes. Provide input on technical design guidelines, outcomes for the program, and future program enhancement as needed.
Deliverable: Brief memo summarizing input on technical design guidelines and outcomes for the program provided between June 2022 and April 2023. Delivered to staff prior to the April 2023 CAC meeting.
Alejandra Posada,
Programs Team
2. Building Electrification
Education
Conduct community education around the Reach Code 2.0 effort and/or building electrification contribution to 2035 decarbonization goal.
Deliverable: Brief memo summarizing community education conducted by CAC members regarding reach codes and/or building electrification between June 2022 and April 2023. Delivered to staff prior to the April 2023 CAC meeting.
Rafael Reyes,
Programs Team
Peninsula Clean Energy
Proposed 2022 CAC Working Groups (cont’d)
Project Proposed Task Description and Deliverables Staff Liaison
3. Demand-Side Strategies
for 24/7 Grid Decarboni-zation
Provide input on the Distributed Energy Resources (DER) framework, focusing on demand-side strategies (e.g., load management / shaping) to accomplish our planned 24/7 grid decarbonization.
Deliverable: Brief memo summarizing input for DER programs provided between June 2022 and April 2023. Delivered to staff prior to the April 2023 CAC meeting.
Peter Levitt and Dave
Fribush, Programs
Team
4. Education Initiatives Provide input on initiatives to expand clean energy curriculum and decarbonization projects in schools.
Deliverable: Brief memo summarizing input on education initiatives provided between June 2022 and April 2023. Delivered to staff prior to the April 2023 CAC meeting.
Vanessa Shin,
Marketing Team
Peninsula Clean Energy
Proposed 2022 CAC Working Groups (cont’d)
Project Proposed Task Description and Deliverables Staff Liaison
5. Role of Citizen Advisory
Committees
Research the roles, objectives, basic functioning, and impact to date of citizen advisory committees at other CCAs and similar public agencies in California.
Deliverable: Brief memo summarizing research on citizen advisory committees and any resulting recommendations for Peninsula Clean Energy, keeping in mind the CAC’s advisory role, provided between June 2022 and April 2023. Delivered to staff prior to the April 2023 CAC meeting.
Kirsten Andrews-Schwind, Marketing
Team
Approval of Authority for Peninsula Clean Energy
CEO to Vote on California Community Power
Board Items (Action)
May 26, 2022
Peninsula Clean Energy
Recommendation
• Approve Resolution Delegating Authority to Chief Executive Officer to Vote on California Community Power (CC Power) Board Items. 27 Peninsula Clean Energy
CC Power Firm Clean Update
• Issued RFO on Oct 25, 2021, for up to 200 MW of Firm Clean Resources, to achieve compliance with the CPUC D.21-06-035 requiring new firm clean resources (zero-emitting) such as geothermal to address mid-term reliability
o https://cacommunitypower.org/solicitations/
• Offers were due on Dec 13, 2021
• In February, CC Power shortlisted two geothermal developers • Negotiations are underway and two project PPAs are near finalized • CC Power will execute projects under a similar structure as the long-duration storage with Tumbleweed
28 Peninsula Clean Energy
Peninsula Clean Energy Approval Process for
CC Power Projects
Date Event
5/9 May Executive Committee Provide background
5/26 May Board Meeting Provide Board with background on project 5/27 Procurement Subcommittee Deeper dive on project and contract Prior to June Peninsula
Clean Energy board
meeting
CC Power Board Meeting Vote on CC Power participation in Firm Clean Power project
6/23 June Board Meeting Report back on status of CC Power vote Within 120 days of CC
Power Board Meeting
June – September PCE board meetings Vote on Peninsula Clean Energy participation in project(s)
Peninsula Clean Energy
CC Power Enhanced Conditions - Workforce
• In April 2021, CC Power Board passed a resolution for Enhanced Project Conditions for the Long Duration Storage (LDS) project • The CC Power Board adopted these same conditions for FCR
1. Workforce:
• Require payment of prevailing wages
• State a preference, but not a requirement for a Project Labor Agreement (PLA) allowing up to 5 points in the evaluation process • For projects that do not implement a PLA, require an audit to ensure compliance with the first two conditions
• Encourage the use of local labor
30 Peninsula Clean Energy
CC Power Enhanced Conditions – Environmental
2. Environmental
• All projects must meet permitting requirements of the appropriate governing authority / authorities
• State a preference for projects that avoid sensitive habitat areas
3. Environmental Justice
• Require the developer to attest to not using forced labor in its supply chain which can be demonstrated by signing on to the SEIA pledge
• Require developers to identify project benefits to local communities 31 Peninsula Clean Energy
Recommendation
• Approve Resolution Delegating Authority to Chief Executive Officer to Vote on California Community Power (CC Power) Board Items 32 Wright Solar 2nd Amended &
Restated Power Purchase
Agreement
Siobhan Doherty, Director of Power Resources
May 26, 2022
Peninsula Clean Energy
Recommendation
• Approve Resolution Delegating Authority to the Chief Executive Officer to Execute a Second Amended and Restated Power Purchase and Sale Agreement for Renewable Supply with Wright Solar Park, LLC, and any necessary ancillary documents with a Power Delivery Term of 25 years, which commenced at the Commercial Operation Date which occurred on January 3, 2020 in an amount not to exceed $900 million.
34 Peninsula Clean Energy
Wright Solar + Storage
35 Developer / Owner Clenera
Location Merced County
Solar Capacity 200 MW
Capacity Factor 31.4%
Storage Size 80 MW / 4 hour – 320 MWh
MWh / ~% of Load ~550,000 / 16%
Storage COD December 31, 2023
Key Milestones LGIA: Executed
Permitting: Complete
Construction Start: June 2023
Labor 5 Party PLA
DACs Located in DAC, expect to provide
workforce development benefits
CONFIDENTIAL
Wright
Solar
Project
Peninsula Clean Energy
Background
• Executed initial PPA for Wright in January 2017
• Executed 1st Amended & Restated PPA in September 2017, when it was acquired by Clenera and Centaurus
• Both included the option to negotiate an amendment to add storage • Wright started operating January 3, 2020
• Staff worked with Wright project owners to negotiate an amended and restated PPA to incorporate storage
36 Peninsula Clean Energy
Contract Structure
• No change to solar PPA – Continue to pay for the output of the solar generating portion of the project at a fixed-price rate per MWh
• Pay for the use of the storage portion of the project at a fixed-price rate per kW-month • Both with no escalation
• Contract term: 25 years, started January 3, 2020
• Peninsula Clean Energy is entitled to all product attributes from the facility:
o Energy
o Renewable energy
o Ancillary services
o Resource adequacy.
37 Peninsula Clean Energy
Decision Requiring Procurement to Address Mid-Term
Reliability (2023-2026)
• Requires LSEs to collectively procure 11,500 MW NQC of new resources
• Passed by CPUC on June 24, 2021
• Follow-on to November 7, 2019 CPUC decision mandating 3,300 MW NQC procurement for 2021-2023 to maintain reliability
• Contract of at least 10 years
• Allocated to LSEs by load share
• Allocated to various resource categories – must be zero-emission or RPS eligible
• No fossil resources
CONFIDENTIAL 38
Peninsula Clean Energy
Peninsula Clean Energy Allocation
CONFIDENTIAL 39
Procurement Category 2023 2024 2025 2026 Total
Zero-emissions generation, generation paired with
storage, or demand response resources1 - - 47 - 47
Firm zero-emitting resources2 - - - 19 19
Long-duration storage resources2 - - - 19 19
Remaining New Capacity Required - - - - 132
Total Annual Capacity Requirements 38 113 28 38 217
1. 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.
2. LSEs may request an extension by February 1, 2023, up to 2028 for the LLT resources • Volumes allocated to LSEs based on load share
• Some portion of category 1 would need to come online prior to 2025 to meet targets below
Peninsula Clean Energy
Generation Profile (Wright Solar)
CONFIDENTIAL 40
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200
5 10 15 20
ώ50
0 50
100
150
200 Re s ou rce
Batte ry
Sola r
Hou r Hou r Hou r Hou r
MW MW MW
Month=9 Month=10 Month=11 Month=12
Month=5 Month=6 Month=7 Month=8
Month=1 Month=2 Month=3 Month=4
Peninsula Clean Energy
Dispatch within PCE Portfolio
0 100
200
300
400
500
600
700
0 100
200
300
400
500
600
700
5 10 15 20 0
100
200
300
400
500
600
700
5 10 15 20 5 10 15 20 5 10 15 20
Load
Wright
Existing Contracts
Hour Hour Hour Hour
MW MW MW
Jan Feb Mar Apr
May Jun Jul Aug
Sep Oct Nov Dec
CONFIDENTIAL 41
Peninsula Clean Energy
Recommendation
• Approve Resolution Delegating Authority to the Chief Executive Officer to Execute a Second Amended and Restated Power Purchase and Sale Agreement for Renewable Supply with Wright Solar Park, LLC, and any necessary ancillary documents with a Power Delivery Term of 25 years, which commenced at the Commercial Operation Date which occurred on January 3, 2020 in an amount not to exceed $900 million.
• Project has positive net value to Peninsula Clean Energy • Project will help to meet MTR Procurement requirements • Project will help to meet 24/7 renewable goal
42 FY 2022-2023
(July 1, 2022 – June 30, 2023)
Budget Review Initial Draft
Board Meeting
May 26, 2022
Peninsula Clean Energy
Schedule – Budget Review and Approval
44 • May 9, 2022 – Review Initial Draft Budget with Audit & Finance Committee • May 9, 2022 – Review Initial Draft Budget with Executive Committee • May 26, 2022 – Review Current Draft Budget with Board of Directors • June 13, 2022 – Review Revised Draft Budget with Audit & Finance Committee • June 23, 2022 – Approve Final Budget by Board of Directors Peninsula Clean Energy
Draft Budget FY2022-2023 – Key Assumptions
45 PG&E Generation Rates – significant rise in rates
o April 1, 2022 – increase 33%
o January 1, 2023 – decrease 10%
o Net change of up 20% as of 1/1/23 compared to 3/31/22 o San Mateo County and Los Banos rates are the same
PCIA Rates – significant decrease in rates
o April 1, 2022 – decrease 59%
o January 1, 2023 – increase 65%
o Net change of down 32% as of 1/1/23 compared to 3/31/22 o Los Banos PCIA rate is higher than SMC starting April 1, 2022. Lower starting on 1/1/23. Then, comparable after 1/1/24 Rates to PCE – up more than 100% through Jan 1, 2023 (although customers only pay an additional 33% in total) Load – FY23 forecasted to be 3.2% higher than FY22 forecast – FY22 includes only 3 months of Los Banos load Cost of Energy –
o Budgeted to increase 18% over FY22 forecast to $263 million (includes $15 million conservatism adder) o Increase of 11% without conservatism adder
Peninsula Clean Energy
PG&E and PCIA Rate Change Summary
46 1/1/2021 4/1/2021 4/1/2022 1/1/2023 1/1/2024 1/1/2025 1/1/2026 Actual Actual Forecast Forecast Forecast Forecast
PG&E Generation Rate 0.112 0.109 0.144 0.130 0.126 0.124 0.126 Generation Rate Change (Percent) 33% -10% -3% -1% 1%
Cumulative % Change from 1/1/22 33% 20% 16% 15% 16%
PCIA (System Average)
San Mateo County 0.032 0.047 0.019 0.032 0.033 0.031 0.028 PCIA Change (Percent) -59% 65% 3% -6% -8%
Cumulative % Change from 1/1/22 -59% -32% -30% -34% -39% PCE Rate to Ratepayers
San Mateo County
PCE Rate (net of PCIA and 5% Discount) 0.075 0.056 0.118 0.092 0.087 0.087 0.092 Net PCE Rate Change (Percent) 109% -22% -5% 0% 5%
Cumulative % Change from 1/1/22 109% 63% 55% 55% 62%
Los Banos 0.028 0.025 0.028 0.032 0.030 0.028
PCIA Change (Percent) -11% 13% 16% -6% -9%
Cumulative % Change from 1/1/22 -11% 0% 16% 9% -1%
Peninsula Clean Energy
Draft Budget FY23 – Summary
47 Budget and Forecast 2022 2022 Variance - Fav/ (Unf) 2023 Items Approved Budget Forecast $ Variance Initial Budget $ Change - Inc/(Dec) % Change
OPERATING REVENUES
Electricity Sales, net 219,619,107 236,757,514 17,138,407 364,961,141 128,203,627 54% Green electricity premium 2,621,034 2,764,175 143,141 2,822,550 58,375 2% 222,240,141 239,521,689 17,281,547 367,783,691 128,262,002 54%
OPERATING EXPENSES
Cost of energy 216,705,953 222,412,656 (5,706,703) 262,900,760 40,488,104 18% Staff compensation 6,464,275 6,132,735 331,540 8,249,693 2,116,958 35% Data Manager 3,420,000 3,397,930 22,070 3,600,000 202,070 6% Service Fees - PG&E 1,260,000 1,243,780 16,220 1,350,000 106,220 9% Consultants & Professional Services 1,351,204 1,060,014 291,190 1,431,813 371,799 35% Legal 1,615,500 1,328,611 286,889 1,474,000 145,389 11% Communications and Noticing 2,068,197 1,710,255 357,942 2,686,208 975,953 57% General and Administrative 2,259,391 2,106,435 1,152,272 2,359,806 253,371 12% Community Energy Programs 6,555,671 4,887,752 1,667,919 8,640,000 3,752,248 77% Depreciation 111,675 86,741 24,934 96,000 9,259 11%
Total Operating Expenses 241,811,865 244,366,909 (1,555,728) 292,788,280 48,421,371 20% Operating Income (Loss) (19,571,724) (4,845,220) 15,725,820 74,995,411 79,840,631 NON-OPERATING REVENUES (EXP.)
Total Nonoperating Income/(Expense) 900,000 (1,983,245) (2,883,245) 600,000 2,583,245 CHANGE IN NET POSITION (18,671,724) (6,828,465) 12,842,575 75,595,411 82,423,876 Net Position at the beginning of period 184,271,220 180,798,537 (3,472,684) 173,970,072 Net Position at the end of period 165,599,497 173,970,072 9,369,891 249,565,483 Total Cash & Cash Equivalents 168,332,845 162,964,482 (5,368,362) 238,559,894 Unrestricted Cash Days on Hand 250 243 297
Current Fiscal Year FY22
Variance Initial Budget vs. Prior Year
Forecast
Peninsula Clean Energy
Draft Budget Detail - Revenues
48 Budget and Forecast 2022 2023
Items Forecast Initial Budget $ Change - Inc/(Dec) % Change
OPERATING REVENUES
Electricity Sales, net 236,757,514 364,961,141 128,203,627 54% Commercial - Demand 19,060,125 19,622,891 562,766 3%
Streetlight and Agr- Demand 258,039 155,461 (102,577) -40% Commercial - Gen 112,412,969 176,626,802 64,213,833 57% Residential - Gen 103,186,947 166,666,713 63,479,766 62% Street lighting and Agr - Gen 2,213,075 3,723,249 1,510,174 68% CAPP Proceeds 1,667,791 - (1,667,791) -100%
Bad Debt Expense (2,041,432) (1,833,976) 207,457 -10%
Green electricity premium 2,764,175 2,822,550 58,375 2% 239,521,689 367,783,691 128,262,002 54%
Current Fiscal Year FY22
Variance Initial Budget vs. Prior Year
Forecast
Initial Fiscal Year Budget FY23
Peninsula Clean Energy
Draft Budget FY2022-2027 – Budget Summary & 5-year Plan 49 Budget and Forecast 2022 2022 2023 2024 2025 2026 2027 Items Approved Budget Forecast Initial Budget Forecast Forecast Forecast Forecast
OPERATING REVENUES
Electricity Sales, net 219,619,107 236,757,514 364,961,141 315,583,351 310,221,811 321,390,127 334,096,231 Green electricity premium 2,621,034 2,764,175 2,822,550 2,973,323 3,132,849 3,301,644 3,480,252 222,240,141 239,521,689 367,783,691 318,556,673 313,354,660 324,691,771 337,576,483
OPERATING EXPENSES
Cost of energy 216,705,953 222,412,656 262,900,760 266,150,723 259,404,029 261,318,950 265,549,966 Staff compensation 6,464,275 6,132,735 8,249,693 8,742,875 9,265,647 9,819,786 10,407,173 Data Manager 3,420,000 3,397,930 3,600,000 3,708,000 3,819,240 3,933,817 4,051,832 Service Fees - PG&E 1,260,000 1,243,780 1,350,000 1,390,500 1,432,215 1,475,181 1,519,437 Consultants & Professional Services 1,351,204 1,060,014 1,431,813 1,454,973 1,453,785 1,450,217 1,449,390 Legal 1,615,500 1,328,611 1,474,000 1,505,320 1,538,876 1,574,838 1,613,390 Communications and Noticing 2,068,197 1,710,255 2,686,208 2,916,529 3,129,555 3,218,162 3,309,427 General and Administrative 2,259,391 2,106,435 2,359,806 2,420,600 2,485,030 2,553,341 2,625,797 Community Energy Programs 6,555,671 4,887,752 8,640,000 13,750,000 15,550,000 18,850,000 23,000,000 Depreciation 111,675 86,741 96,000 96,000 96,000 96,000 96,000 Total Operating Expenses 241,811,865 244,366,909 292,788,280 302,135,520 298,174,377 304,290,293 313,622,411 Operating Income (Loss) (19,571,724) (4,845,220) 74,995,411 16,421,154 15,180,283 20,401,478 23,954,072 NON-OPERATING REVENUES (EXP.)
Total Nonoperating Income/(Expense) 900,000 (1,983,245) 600,000 618,000 636,540 655,636 675,305 CHANGE IN NET POSITION (18,671,724) (6,828,465) 75,595,411 17,039,154 15,816,823 21,057,115 24,629,377 Net Position at the beginning of period 184,271,220 180,798,537 173,970,072 249,565,483 266,604,637 282,421,460 303,478,574 Net Position at the end of period 165,599,497 173,970,072 249,565,483 266,604,637 282,421,460 303,478,574 328,107,951 Total Cash & Cash Equivalents 168,332,845 162,964,482 238,559,894 255,599,047 271,415,870 292,472,985 317,102,362 Unrestricted Cash Days on Hand 250 243 297 309 332 351 369 Current Fiscal Year FY22 Fiscal Year Projections
Voluntary Allocation Market Offer
(VAMO)
Siobhan Doherty, Director of Power Resources
May 26, 2022
Peninsula Clean Energy
Background
• CPUC Rulemaking R.17-06-026 opened on June 26, 2017, to review, revise and consider alternatives to the Power Cost Indifference Adjustor (“PCIA”). • D.18-10-019 opened a second phase of the proceeding with a working group process resulting in four decisions to address three specific topic areas: (1) the market price benchmarks, (2) a voluntary prepayment option, and (3) portfolio optimization and cost reduction of the IOUs PCIA portfolios.
• D.21-05-030 was issued on May 24, 2021, as part of Phase 2 of the PCIA proceeding - addresses portfolio optimization activities associated with RPS resources subject to PCIA cost recovery. • A Voluntary Allocation and Market Offer (“VAMO”) mechanism was adopted, including authorizing a process for the IOUs to allocate a “slice” of an IOU’s entire PCIA-eligible RPS portfolio to eligible load serving entities (“LSEs”) in proportion to their vintaged, forecasted annual load share. • Under VAMO, LSEs have the option to contract for a long-term allocation, short-term allocation, or decline all or a portion of their allocation.
51 Peninsula Clean Energy
Background
• Term Start: January 1, 2023
• Short-Term Allocation End: December
31, 2024
• Long-Term Allocation End: will be the
latest end date of all PPAs for resources
in the long-term pool with a PCIA vintage
applicable to Buyer
• PG&E is required to do a VAMO once
per RPS compliance period
52 Peninsula Clean Energy
Timing
• CPUC issued ruling
on Friday May 20th
,
extending timelines for
allocations
• Staff will provide an
update and
recommendation at
June Board meeting
53 Date Action
May 31 July 29 Return attestation to PG&E
June – July December 31 PG&E approval from CPUC
January 1, 2023 Allocation term starts
Peninsula Clean Energy
Risks Associated with Allocation
• Pricing
• Volume
• Meeting 24/7 Renewable Goal
• Resource type
• Term
• REC Classification
54 Peninsula Clean Energy
Price Risk
• Pricing for VAMO contracts is variable
• Energy index price plus a REC adder based on an annual Market Price Benchmark (“MPB”)
o Set through PCIA process each year
• Will pay monthly based on forecasted MPB
• Annual true-up the following year based on actual MPB • Index plus contracts are generally less attractive economically than bundled contracts
55 Peninsula Clean Energy
Volume Risk
• Significant risk and difficulty estimating the volume we should expect o Allocation share will vary annually based on load, will differ between SMC and LB
o RPS Energy will vary based on actual production, may have different resources applicable to different PCIA vintages
56 Peninsula Clean Energy
Volume Risk (Cont’d) – Add / Remove Resources
• PG&E can remove resources from portfolio, if
o Contract terminates or expires
o Resource is no longer in their PCIA-eligible portfolio due to an order from a Governmental Authority or Governmental Entity
o The Resources is owned by Seller, but ceases operation • PG&E can add resources to portfolio
o For Resources that have a PCIA vintage that corresponds with Buyer’s Allocation Share
o From Customer Programs – GTSR and DAC
• PG&E will provide notice of additions or removals “as soon as reasonably practicable”
57 Peninsula Clean Energy
Volume Risk (Cont’d) – Third Party Sales
• PG&E has the right to sell all or any portion of the RECs associated with the resources
• There does not appear to be any notice requirement associated with this
• Sales would be incorporated into the calculation of allocation amounts and would appear on our invoices, which we receive 4 months after energy generation
58 Peninsula Clean Energy
Meeting 24/7 Goal
• We will not know whether allocations can help to meet 24/7 goal • The only information we will receive will be project, type of resource, quantity, month and year of generation
• We will not know daily or hourly details on when generation occurred 59 Peninsula Clean Energy
Resource Mix – GHG Emissions
• Limited visibility into the resource mix we would receive • Project list includes biomass and other resources that have GHG emissions
• May increase our GHG emissions reported on PCL
• Will be more difficult to forecast GHG emissions
60 Peninsula Clean Energy
Unbundled RECs
• Accepting allocation could result in procurement of unbundled RECs or PCC2 RECs, both of which have negative implications for reporting GHG emissions on Power Content Label o Peninsula Clean Energy has policy against procurement of unbundled RECs • Under the RPS, there are three REC classifications:
o PCC1 – Bundled in CA – Peninsula Clean Energy purchases only PCC1 o PCC2 – Located outside of CA
o PCC3 – Unbundled RECs
• The IOUs have some resources that were procured prior to the PCC classification system. These resources were assigned a PCC0 classification and grandfathered into the program. However, if these resources are re-sold, they would lose their grandfathering status and take on the appropriate classification (PCC2 or PCC3).
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Unbundled RECs
• During regulatory process, the IOUs recommended that PCC0 RECs that are allocated from the IOUs’ to LSEs through the Voluntary Allocation process retain their PCC0 classification eligibility, with the same benefits and limitations that apply to the IOUs’ use of PCC0 RECs • CPUC and other agencies has yet to rule on this matter in R.18-07-003 o On May 20, 2022, the CPUC issued a proposed decision that would allow the PCC0 RECs to retain their PCC0 classification; expect a final decision June 23, 2022
• This remains a large regulatory concern for VAMO
o Peninsula Clean Energy has policy against procurement of PCC3 RECs o A reclassifications of PCC0s to PCC2 or PCC3 would have negative power content label impacts
PG&E Portfolio make-up of PCC1 v PCC0 RECs
62 2023 2024 2025 2026 2027 2028 2029 2030
PCC1% 36.6% 36.3% 37.9% 39.0% 39.6% 39.7% 40.7% 40.8%
PCC0 % 63.4% 63.7% 62.1% 61.0% 60.4% 60.3% 59.3% 59.2%
Peninsula Clean Energy
Other CCAs Approach
• Some CCAs are planning to accept allocation to ensure they are in compliance with RPS long-term procurement requirements
• Peninsula Clean Energy is over-procured on RPS quantity and long-term requirements due to early execution of Wright and Mustang PPAs
• At this point, staff would recommend not accepting allocation due to the various types of risk
• Will present a formal recommendation and action item at June Board meeting
63 Peninsula Clean Energy
Thank you!
64 Questions?
Board Members’ Reports (Discussion)
Adjournment
Peninsula Clean Energy