Executive Committee Meeting
This meeting will begin shortly.
June 10, 2024
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 Agenda Items Consent Items o Public Comment
• Regular Agenda
• Committee Members Reports
• Adjourn
Chair Report
CEO Report
FYE 2025 Budget and 5-Year Forecast (Action)
Nick Bijur, Chief Financial Officer
Peninsula Clean Energy
Product FY25 Increase
relative to FY24
Energy ($/MWh) 9%
REC ($/MWh) 69%
GHG-Free ($/MWh) 452%
RA ($/kW-month) 46%
Cost of Energy
• Cost of Energy increase due to:
o Significantly higher REC, GHG-Free and RA prices (see below) o Contingency (~7% of FY25 costs)
o Load increase largely due to organic growth and normalized weather (~2%) and new commercial load (~3%)
6 2023 2024 2025
Items Actual Actual + Forecast Forecast $ %
Cost of energy 265,207,567 326,968,882 423,403,737 96,434,855 29% Variance vs FY2024
FY25 Increases
Capacity 34,371,416
Energy 26,680,919
Contingency 23,156,869
REC/GHG-Free 13,040,789
Other -815,139
Total 96,434,855
Peninsula Clean Energy
Programs - Expense
• Increase in Programs expense driven by:
o Surplus Funds (member agency grants and school building electrification) o New programs (GovBE, Turnkey BE, Resi PV+storage)
o Ramp-up in existing programs (Home Upgrade, appliances, EV charging) 7 Expenses
Buildings - Codes 200,000
Buildings - Existing 15,000,000
EV - Vehicles 800,000
EV - Managed Chg 150,000
EV - Chg (EV Ready) 4,000,000
EV - Fleet 360,000
EV - Bike 300,000
DER - Gov Solar 160,000
DER - Residential 500,000
DER - FLEXmarket 2,200,000
Member Agency Energy Grants 3,000,000
Other/misc/uncategorized 700,000
2023 2024 2025
Items Actual Actual + Forecast Forecast $ %
Community Energy Programs 7,233,127 14,221,194 27,370,000 13,148,806 92% Variance vs FY2024
Peninsula Clean Energy
Programs – Revenue and Capital Expense
• Expanded capital programs
o GovPV ($21 million)
o Surplus Funds (~$7 million) --
financing for GovBE and
residential storage
• Programs expenses offset by
external revenues ($5.3 million)
and return of capital ($1.7 million)
8 Program Revenues
CPUC Revenues (2,300,000)
Menlo Park CEC Grant (2,000,000)
Other (CALeVIP return) (950,000)
Total External Revenues (5,250,000)
Balance Sheet
Outlay
OBF Capital 3,000,000
DER-Gov Solar 21,100,000
GovBE Capital 3,600,000
Resi Energy Storage 3,000,000
Inflow
OBF Revenues (950,000)
DER-Gov Solar (240,000)
GovBE Revenue (514,286)
All Revenues & Outlays 23,745,714
Peninsula Clean Energy
Compensation
• Staff compensation increase due to:
o 14 additional headcount in FY24 (3 of which were vacancies from 2023) o 8 new headcount proposed in FY25 (4 of which are for the proposed in-house customer contact center)
o Assumes 8% salary increase effective July 1 (average of 5% merit/COLA plus selective market adjustments)
• Proforma compensation increase of 19% (assuming full staffing in 2024) 9 2023 2024 2025
Items Actual Actual + Forecast Forecast $ %
Staff compensation 8,001,778 9,764,849 13,581,323 3,816,474 39% # of FTE 39 53 61
% of Revenue 1.9% 2.5% 2.9%
Variance vs FY2024
Peninsula Clean Energy
Other Operating Expenses
• Calpine and PG&E costs relatively stable
• Consultants increase primarily due to Power Resources (battery optimization, transmission, CC Power project and reclass of broker fees)
• Legal increase due to anticipated Federal and Power Resources support • Communication increase due to branding, marketing and website support ($550k) and community partner and school grants ($200k)
• G&A increase primarily due to new software across multiple departments ($1.4 million) 10 2023 2024 2025
Items Actual Actual + Forecast Forecast $ %
Data Manager 3,604,390 3,592,354 3,600,000 7,646 0%
Service Fees - PG&E 1,323,863 1,332,910 1,334,400 1,490 0% Consultants & Professional Services 951,686 1,334,408 2,187,810 853,403 64% Legal 1,205,757 987,184 1,393,965 406,781 41%
Communications and Noticing 1,329,437 2,034,653 2,700,073 665,420 33% General and Administrative 2,283,867 3,050,880 4,677,376 1,626,496 53% Depreciation 75,078 135,421 338,644 203,224 150%
Variance vs FY2024
Peninsula Clean Energy
No Rate Change "Break-Even" 5% discount
Operating Revenues 482,254,010 471,590,085 461,178,732
Rate Stabilization Fund - - 15,000,000
Revenues 482,254,010 471,590,085 476,178,732
Total Costs 471,552,614 471,552,614 471,552,614
Change in Net Position 10,701,396 - 4,626,119
Total Cash & Cash Equivalents 363,880,972 353,217,048 342,805,695 Days Cash on Hand (DCOH) 277 268 261
Discount to PG&E 1% 3% 5%
Fiscal Year 2025
FY2025 Revenue Scenarios
• Anticipating 11% decrease in PG&E generation rates in July 2024 (will be confirmed in June) • Three rate/revenues scenarios
• Recognition of revenue from the Rate Stabilization Fund in FY25 will allow PCE to offer a 5% discount to PG&E while maintaining sufficient DCOH (261 days) 11 Peninsula Clean Energy
2023 2024 2025
Items Actual Actual + Forecast Forecast $ %
OPERATING REVENUES
Electricity Sales, net 423,844,351 446,060,195 451,925,086 5,864,891 1% Green electricity premium 3,011,460 3,003,120 3,763,646 785,897 26% Non-Energy Related Revenue 2,151,927 5,832,317 5,490,000 (331,181) -6% Rate Stabilization Fund (65,000,000) 15,000,000 74,510,000 -115% Total Operating Revenues 429,007,738 389,895,632 476,178,732 6,283,100 2% Variance vs FY2024
FY2025 Revenue – 5% discount
• 2% increase in revenues (excluding the Rate Stabilization Fund) due to:
o Increased base load (5%)
o Increased ECO100 charge to 1.5 cents starting January 1, 2025 o CARE/FERA rebate in 2024
o Offset in part by lower average net rates
12 Excludes impact of
Rate Stabilization Fund
Peninsula Clean Energy
2023 2024 2025 2026 2027 2028 2029
Items Actual Actual + Forecast Forecast Forecast Forecast Forecast Forecast
OPERATING REVENUES
Electricity Sales, net 423,844,351 446,060,195 451,925,086 481,085,297 477,994,082 457,974,343 485,858,364 Green electricity premium 3,011,460 3,003,120 3,763,646 4,569,745 4,594,132 4,618,762 4,643,639 Non-Energy Related Revenue 2,151,927 5,832,317 5,490,000 13,875,000 4,310,000 2,595,000 13,180,000 Rate Stabilization Fund (65,000,000) 15,000,000 20,000,000 - - - Total Operating Revenues 429,007,738 389,895,632 476,178,732 519,530,042 486,898,213 465,188,105 503,682,003
OPERATING EXPENSES
Cost of energy 265,207,567 326,968,882 423,403,737 456,580,771 417,955,309 395,243,245 427,633,426 Gross Profit 163,800,171 62,926,750 52,774,995 62,949,271 68,942,905 69,944,860 76,048,577
OTHER OPERATING EXPENSES
Staff compensation 8,001,778 9,764,849 13,581,323 16,036,618 17,277,976 18,798,368 20,014,415 Data Manager 3,604,390 3,592,354 3,600,000 3,600,000 3,600,000 3,600,000 3,600,000 Service Fees - PG&E 1,323,863 1,332,910 1,334,400 1,334,400 1,334,400 1,334,400 1,334,400 Consultants & Professional Services 951,686 1,334,408 2,187,810 2,238,855 2,279,168 2,314,076 2,365,239 Legal 1,205,757 987,184 1,393,965 1,441,850 1,493,414 1,545,771 1,602,083 Communications and Noticing 1,329,437 2,034,653 2,700,073 2,129,493 2,176,283 2,224,481 2,274,138 General and Administrative 2,283,867 3,050,880 4,677,376 4,732,636 4,972,988 5,208,275 5,433,503 Community Energy Programs 7,233,127 14,221,194 27,370,000 34,830,000 36,860,000 32,060,000 43,310,000 Depreciation 75,078 135,421 338,644 1,518,644 2,684,894 2,684,894 2,684,894 Total Other Operating Expenses 26,008,983 36,453,852 57,183,591 67,862,495 72,679,124 69,770,265 82,618,672 Operating Income (Loss) 137,791,188 26,472,898 (4,408,596) (4,913,225) (3,736,219) 174,594 (6,570,096) NON-OPERATING REVENUES (EXP.)
Total Nonoperating Income/(Expense) 2,164,071 11,829,309 9,034,715 8,225,197 7,841,314 8,077,312 8,215,267 CHANGE IN NET POSITION 139,955,259 38,302,207 4,626,119 3,311,972 4,105,095 8,251,906 1,645,171 Total Cash & Cash Equivalents 254,073,593 381,548,624 342,805,695 309,066,239 307,204,191 310,573,240 308,039,840 DCOH 319 383 261 216 230 245 222
Preliminary 5-Year Forecast
13 Discussion of Proposed Updates to PCE
Rate Tables, Rates and ECO100 Premium
Leslie Brown, Director of Account Services
Peninsula Clean Energy
Background- PCE Rate Update
• PG&E will be updating electric rates effective July 1, 2024; actual PG&E rates expected to publish at the end of June.
• PG&E generation rates are expected to decrease system wide by ~11% as a 2023 under-collection surcharge sunsets
• PCE is currently maintaining two rate schedules (Vintage 2016 & Vintage 2022)
• Staff is proposing to move to one rate schedule for all customers with PCE's next rate adjustment taking effect in August, if approved by the Board
15 Peninsula Clean Energy
One vs. Two Rate Schedules for FYE 2025
• Setting one rate schedule aligned with PCE's 2016 Vintage will allow for a minimum 5% discount for customers across all Vintages
o ~95% of PCE customers are assigned Vintage 2016
o ~85% of Los Banos customers are assigned Vintage 2021 o Remaining Los Banos customers are assigned Vintage 2022 and remaining SMC customers have Vintages spread across 2016-2023
• PCE originally set and maintained two rate schedules because the 2016 PCIA was previously lower than 2021 and 2022 Vintage surcharges. • The 2016 surcharges are now higher than later Vintages and all customers can benefit with a discount from one rate schedule calibrated to the 2016 Vintage
16 Peninsula Clean Energy
Current PCIA Vintage Differential 2016 vs 2022
17 Peninsula Clean Energy
Considerations for Moving to One Rate Schedule
• For FYE 2025 PCE would collect more revenue if two rate schedules were implemented (~$1.2M)
o Vintage 2022 rates (predominantly Los Banos customers) would have higher PCE charges - PCE would collect more revenue per kWh from customers assigned Vintage 2022 rates but net effective discount for customers would still be 5%
• One rate schedule reduces complexity for both Calpine and PCE with regards to billing operations and maintenance
• Reduced confusion for customers when looking for rates and rate comparisons on our website with one schedule
• Customers with Vintages other than 2016 will have a higher discount 18 Peninsula Clean Energy
Staff Proposal-2024 Rate Update
• Recalibrate PCE rates following PG&E’s July 1, 2024 rate update • Move to one rate schedule applied to all customer based off PCIA 2016 Vintage surcharges
• Net minimum 5% discount is estimated to require allocation of $15M from Rate Stabilization Fund
• New PCE Rates effective August 1, 2024
Questions?
19 Peninsula Clean Energy
Background-ECO100 Premium
• ECO100 has been a Green-e certified product with a $0.01 premium since PCE launched service
• Review of ECO100 program driven by projected changes to Green-e program
• Green-e program issues have since resolved
• Program analysis included a ‘true cost’ review with Power Resources 20 Peninsula Clean Energy
Estimated “True” Cost of ECO100 Service
Increasing the ECO100 Premium would increase FY revenues by approximately $1.5MM ($750K for FY25 with rates adjusted Jan 1, 2025) Peninsula Clean Energy
Top 20 ECO100 Customers
Rank Row Labels Sum of Usage
1FACEBOOK INC 26.11%
2GILEAD SCIENCES INC 21.39%
3COUNTY OF SAN MATEO 8.93%
4CITY OF SAN MATEO 4.47%
5VISA U S A INC 4.21%
6CITY OF REDWOOD CITY 2.91%
7SONY INTERACTIVE ENTER 1.78%
8CITY OF BURLINGAME 1.74%
9PLENTY UNLIMITED INC 1.40%
10SAN MATEO COUNTY TRANS 1.28%
11IMPOSSIBLE FOODS INC. 1.25%
12CITY OF MENLO PARK 1.05%
13CITY OF MILLBRAE 0.89%
14CITY OF FOSTER CITY 0.84%
15CITY OF SAN CARLOS 0.72%
16TR PARKSIDE TOWERS COR 0.68%
17NORTHERN CA PRESBYTERI 0.64%
18GENENTECH INC 0.60%
19CITY OF BRISBANE 0.56%
20TOWN OF HILLSBOROUGH 0.55%
Peninsula Clean Energy
Staff Proposal-ECO100 Premium
• Staff is proposing to increase ECO100 premium to 1.5 cents ($0.015) effective January 1, 2025
• Adjusting premium effective January 1 provides plenty of time for staff to create noticing materials for ECO100 customers (minimum 30 days required by Green-e)
• Adjusting rates on the calendar year also aligns with Green-e program year and compliance reporting
• A calendar year adjustment will also allow our large commercial customers time to make informed budget decisions for continued participation Questions?
23 Self Generation Incentive Program (SGIP)
Assistance Program (Action)
Jana Kopyciok-Lande, Associate Director Strategy and Innovation Peninsula Clean Energy
Context: Revenue Diversification for PCE Programs
25 • CPUC Community-Scale
Microgrids
• EPA Solar for All
• CPUC Expanded AgFIT
• CPUC VGI Pilots
• CEC DEBA
• CPUC SGIP Assistance Program
• EPA Green Bank Financing
• CPUC EE Application
• CEC Equitable Building Decarb
• DOE HOMES
Energy
Efficiency/
Electrification
Behind-the-Meter
Distributed
Energy
Resources
Front-of-the-Meter
Distributed
Energy
Resources
Real-Time
Pricing
Peninsula Clean Energy
Opportunities Supporting DER Programs
26 Fixed battery storage
(and solar)
Right-sized resilience “Virtual power plants”
• DEBA Group 2
• SGIP Assistance
Program
• EPA Green Bank
Financing
• DEBA Group 3
Peninsula Clean Energy
SGIP Assistance Program
• Background
o SGIP is a statewide incentive program administered by the IOUs that provides incentives for a variety of customer-sited DERs, including solar and energy storage
o The Legislature recently allocated new funding for income-qualified residential customers and raised incentive levels to cover 100% of project costs
• Scope
o Support income-qualified residential customers in accessing statewide SGIP incentives o Outreach campaign to identify and recruit eligible customers o Rebate administrator supports SGIP applications
o Provide technical assistance, including zero-percent financing for roofing upgrades o Incorporate resources under PCE Virtual Power Plant (VPP) • Budget
o ~$125 million for PG&E’s service area, expected to be exhausted quickly o Goal is to enroll 200 customers, bringing $4.6 million in SGIP incentives to PCE customers • Timeline
27 08/19/2024
Implementation
Advice Letter
Sept – Oct. 24
Outreach
Campaign
Nov - Dec. 24
Application
Support
Oct.24 - Oct.25
Technical
Assistance
Peninsula Clean Energy
Recommendation
Approve development of PCE SGIP Assistance Program
Competitively select Rebate Administrator via Request for Proposal (RFP).
Cost will depend on application volume, estimated at < $100,000 Potentially select one or more installers as “participating contractors” PCE Marketing team to run outreach campaign
PCE Program team staffer to function as content expert and coordinator Offer Zero Percent Loan on-bill finance to address roof repair costs (if necessary)
28 $4.6 million in statewide incentives for PCE income-qualified customers Proposed Administrative Updates to
Operating Policies 14, 15 and 16 (Action)
Shawn Marshall, CEO
Nelly Wogberg, Office Manager and Board Clerk
Peninsula Clean Energy
Background and Context
• Staff identified inconsistencies between Peninsula Clean Energy’s Operating Rules and Regulations (i.e. Board Policies) and some elements of the Joint Powers Authority (JPA) Agreement;
o JPA vs. Policies – similarities and differences
• Staff conducted a thorough review of Policies 14, 15 and 16 all of which have some degree of overlap with the JPA Agreement and/or each other; • In late 2023, the Board requested that staff develop decorum procedures to guide public participation at Brown Act/public meetings, and staff simultaneously identified the need to more thoroughly document Board and Committee operations reflecting current practice (ref Policy 16). 30 Peninsula Clean Energy
Proposed Updates to Policy 14
1) Clarify Policy Title
“Delegation of Non-Energy Contracts Commitment and Financial Authority Policy” -> “Non-Energy Agreement Signatory and Delegation Policy”
2) Avoid misalignment with JPA
CEO/C-Suite signing authority thresholds are now here, not duplicating in the JPA Agreement 3) Increase CEO contract authorization threshold to $250k o "Middle of the pack" when benchmarked against other CCAs o Represents .44% of 2025 non-energy budgeted costs compared to $100k in 2018 representing .92% non-energy budgeted costs
4) Delegate authority in CEO's Absence
New section delegating contract authority to the CFO/COO if the CEO is unavailable and with written approval of CEO or Board Chair
31 Peninsula Clean Energy
Proposed Updates to Policy 15
1) New section delegating authority to the CFO for the same energy contract authorities provided to the CEO, if the CEO is unavailable and with written approval by the CEO or Board Chair
32 Peninsula Clean Energy
Proposed Updates to Policy 16
1) Clarify Policy Title and Expand Policy Scope
“Selection of the Chair and Vice Chair and Appointment to the Executive Committee and Other Standing Board Committees” -> “Policies and Procedures for Board of Directors, Committees, and Advisory Groups”
2) Officer term limits removed here and moved to JPA
- Recommendation for 2-year term limit in next agenda item 3) Defines scope and procedures for Brown Act committees, Staff led committees and Advisory Groups
4) Added Emeritus Advisory Group language here rather than the JPA 5) Added information on remote meeting attendance, including AB 2449, for members of the Board/Committees
6) Added guidelines around decorum and public participation 33 Peninsula Clean Energy
Recommendation
• Discussion and Recommend Adoption to the Board of Directors Edits to Peninsula Clean Energy Operating Rules and Regulations: Policy 14, "Delegation of Non-Energy Contracts Commitment and Financial Authority Policy", Policy 15, "Energy Supply Procurement Authority", and Policy 16, "Selection of the Chair and Vice Chair and Appointment to the Executive Committee and Other Standing Board Committees".
34 Proposed Administrative Updates to the
Joint Powers Authority (JPA) Agreement (Action)
Shawn Marshall, CEO
Nelly Wogberg, Board Clerk
Peninsula Clean Energy
Background and Context
• In reviewing and updating language in policies 14, 15 and 16, Staff identified several elements of the JPA Agreement that were outdated, duplicative and/or in need of clarification.
• JPA Amendments proposed are primarily administrative/operational in nature
• Once the Board approves the proposed amendments, the revised JPA Agreement will be sent to member agencies for a 30-day comment period before final Board approval.
36 Peninsula Clean Energy
Proposed JPA Updates
1) Section 3.1.1 Directors Emeritus. Move to Policy 16
2) Section 3.3.7 Add Board authorities for CPUC, FERC, and other agency filings
3) Section 3.4 Move dollar value of CEO contract authority to Policy 14 4) Section 3.9.1 Update officer term limits from a maximum of three years to two years to better align with local election cycles
5) Section 6.1.1 Update Right to Withdraw from 6 to 12 months to better align with current RA rules
6) Section 5.3.1 Update Budget language (see next slide) 37 Peninsula Clean Energy
Additional Inclusion – Section 5.3.1 - Budget
• The initial annual budget shall be approved by the Board. Staff shall report to the Board quarterly budget results and any significant budget variances. The Board may revise the budget as needed to address any significant changes and/or unexpected expenses incurred. The Board may revise the budget from time to time as may be reasonably necessary to address contingencies and unexpected expenses. All subsequent budgets of the Authority shall be approved by the Board in accordance with the Operating Rules and Regulations. 38 Peninsula Clean Energy
Recommendation
• Recommendation to the Board of Directors to approve the proposed administrative edits to the Joint Powers Authority with the new inclusion of updates to Section 5.3.1.
39 Committee Members’ Reports
Adjournment