Peninsula Clean Energy Board Retreat Agenda and Conversation Guide
October 24, 2024
Objectives
▪ Ground Board members in work that is foundational to PCE’s strategic thinking and decision-making ▪ Engage the full Board in the key issues PCE must address in the medium- and long-term ▪ Introduce the full Board to how three critical questions are being developed and the types of policy positions that might come to the Board for approval later Agenda
Topic Time Details
Welcome and Setting the Context 25 mins Introductions
New Process Overview
See Strategy Pyramid and Process
Critical Question One: Procurement 60 mins See Critical Question One Q&A
Discussion:
How do you think PCE should balance
the four factors driving procurement
decisions?
What else should PCE be considering
during procurement decision-making and
priority setting?
What else do you need to know when
voting on a PCE policy in this area?
Break – 10 mins
Critical Question Two: Equity Customers 60 mins See Critical Question Two Q&A
Discussion:
Which equity customer segments should
PCE prioritize serving with its own
generation/ratepayer revenues (vs use
of external public funds)?
How should PCE balance its programs
funding considering a desire to achieve
both decarbonization and equity goals?
How do rate discounts and periodic
rebates factor into this discussion?
What else do you need to know when
voting on a PCE policy in this area?
Topic Time Details
Critical Question Three: Lines of Business 40 mins See Critical Question Three Q&A
Discussion:
Are the critical questions and
opportunities clear? (Q&A for
understanding)
Which opportunities seem most relevant
or important for PCE to consider over
the next five years?
Should PCE consider adding or
expanding any lines of business not
expressed here?
What other factors should PCE be
considering within this discussion?
PCE’s Future Value Proposition 25 mins See Future Value Proposition Decision-Making Criteria 10 mins See Decision-making Criteria Next Steps and Close 10 min
Peninsula Clean Energy – Conversation Guide
Table of Contents
The Strategy Pyramid and Process Outline...................................................................................................4 Critical Questions ..........................................................................................................................................6 Question One: What are PCE’s procurement priorities and how do affordability concerns affect those priorities?...................................................................................................................................................6 Context ..................................................................................................................................................6 Definitions ..............................................................................................................................................7 Possible Answers...................................................................................................................................8 Question Two: How can PCE continue to deliver programs and services within an equity framework while also scaling decarbonization?..................................................................................................................10 Context ................................................................................................................................................10 Definitions ............................................................................................................................................11 Possible Answers.................................................................................................................................11 Question Three: Are there any new or modified lines of business that PCE should engage in to further support decarbonization and electrification in California?.........................................................................12 Context ................................................................................................................................................12 Definitions ............................................................................................................................................13 Possible New or Modified Lines of Business ........................................................................................13 Future Value Proposition.............................................................................................................................15 What could our future value proposition be?............................................................................................15 What new strengths do we need?............................................................................................................16 Current Strengths to Reinforce ................................................................................................................16 Decision-Making Criteria .............................................................................................................................17
The Strategy Pyramid and Process Outline
Peninsula Clean Energy is advancing its strategy development and planning effort through three distinctive stages. These three stages of work align with the graphic below, including Organizational Strategy, Programmatic Strategy, and Operational Strategy.
We are deeply engaged in the first stage of work, focused on Board feedback and adoption of PCE’s Organizational Strategy. The Organizational Strategy will consist of the Board’s direction on policy positions related to three critical questions that will guide PCE over the next five years. Also included in this first stage of work are two foundational activities: defining PCE’s future value proposition and developing a set of decision-making criteria to guide our strategic choices during and after this process. PCE’s Organizational Strategy will come to this Board for consideration and adoption at its January 2025 meeting. No decisions are expected at the October 2024 Board retreat; we are focused on providing information about the three critical questions and soliciting Board input into the options presented.
Based on the adopted Organizational Strategy, staff will develop “Programmatic Strategies” designed to bring the Organizational Strategy to fruition. This effort will include describing key metrics and milestones for PCE’s range of customer-serving activities including procurement and programs that the Board can use to
oversee progress. We anticipate staff proposals on PCE’s programmatic strategies coming to the Board as informational updates in Spring 2025.
Operational strategies to implement the key metrics and milestones will be developed by staff in Spring-Summer 2025 and come to the Board as part of ongoing strategic plan updates.
Based on this work, the final PCE Strategic Plan 2025-2030 will incorporate the following components:
▪ PCE’s Organizational Strategy defining PCE’s strategic policy positions (January 2025) ▪ PCE’s Programmatic Strategy establishing key metrics and milestones to implement the strategic policy positions (Spring 2025)
▪ PCE’s Operational Strategy outlining the operational, processes, and infrastructure needs for reaching the key metrics and milestones (Summer/Fall 2025)
PCE’s Organizational Strategy
Critical Questions
The strategy development process is focused on a small number of critical questions that, if resolved, will provide broad guidance for ongoing decision-making by PCE. Three critical questions have been identified as the focus of this process based on conversations with staff, the Board’s Ad Hoc Strategic Planning Committee, and community representatives. In particular, much of this framing was developed at a half-day session that included members of the Board’s Ad Hoc Strategic Planning Committee and senior staff on August 12, 2024. The three critical questions include:
1. What are PCE’s procurement priorities and how do affordability concerns affect those priorities?
2. How can PCE continue to deliver programs and services within an equity framework while also scaling decarbonization?
3. Are there any new or modified lines of business that PCE should engage in to further support decarbonization and electrification in California?
Another question that has been raised is PCE’s stance on geographic expansion. Resolving this is not central to this process. It can be addressed at a later time informed by this effort’s methodology and decision-making process.
The information that follows is designed to spark a conversation among key partners as part of an information-gathering effort around these critical questions. Based on the information gathered, the PCE Board of Directors will be asked to adopt strategic policies in these areas that will inform ongoing PCE planning and decision-making.
Question One: What are PCE’s procurement priorities and how do affordability concerns affect those priorities?
Context
SB 100 (2018) requires that all retail electricity resources must be renewable or zero carbon by 2045. To achieve this goal, PCE (and other LSEs in the State) have been driving towards the decarbonization of the energy supply by procuring greenhouse gas (GHG) free and renewable energy. At this time, according to their Power Content Labels, many electric Load-Serving Entities (LSEs) in California, including PCE and the IOUs, are reporting almost 100% GHG-free energy on an annual basis. However, there are many considerations and approaches to the decarbonization of energy (see below) that can obscure progress against proclaimed goals. For example, natural gas still accounts for 39% of California’s electricity on the grid. This natural gas is often not reflected on the Power Content Label by LSEs through the procurement of excess renewable or GHG-free electricity. In short, the system is imperfect; yet the shortfalls of the state’s mandated annual emissions reporting through the power content label are a key factor in evaluating and reporting on current PCE procurement goals. As a reminder, PCE’s current goal is to achieve 100% renewable energy on an annual basis by 2030 through strategic and cost-effective procurement of resources that maximize Peninsula Clean Energy’s 24/7 hourly matching of renewable energy and load.
Furthermore, recent market changes, increased market demand for clean power, wildfire and outage concerns, and regulatory mandates have increased price pressure on PCE’s procurement of generation resources. Subsequently, rate affordability has become a bigger concern for customers and policymakers given recent bouts of inflationary price pressure in the economy. Considering these pressures, PCE must determine what its priorities are as it continues to build out its generation resource portfolio.
Competing considerations include (but are not limited to):
▪ Centering rate affordability for PCE customers
▪ Reducing GHG emissions from electric supply using the following approaches:
Procurement of GHG-free/carbon-free energy on annual basis Procurement of renewable energy procurement on an annual basis Focusing procurement to achieve 24/7 time-coincident renewable energy Definitions
Decarbonization: The reduction or elimination of carbon dioxide and other greenhouse gas (GHG) emissions from the process of generating and delivering electricity, and from end-use processes such as transportation, space heating, water heating, industrial processes, etc. In the context of Question 1, we are only focusing on decarbonization of electricity generation and delivery.
GHG-free energy: Energy produced from resources that generate no carbon emissions1including large hydroelectric resources and nuclear power in California.
Renewable Energy: Resources that meet California’s renewable portfolio standard (RPS) which include solar, wind, geothermal, small hydroelectric, biopower, and ocean thermal and tidal facilities.2 PCE’s procurement policy excludes biomass although this energy is still considered renewable energy under state law.
3 Generation Provider: PCE, as a California load serving entity, is the default electric generation service provider for all of its customers, signing contracts with developers and other counterparties to deliver electricity that is supplied to California’s grid on behalf of its customers.
Power Content Label: Each load-serving entity in California is required to send a Power Content Label (PCL) to its customers every year. The PCL reflects the environmental attributes associated with the energy procured by the LSE on an annual basis. The format and reporting of the PCL is regulated by the California Energy Commission in response to state law. 24/7 time-coincident matching renewable energy goal: Matching renewable energy with customer demand in each and every hour of the day. PCE’s current approach to 24/7 is to maximize hourly matching while balancing affordability. This may result in “partial” 24/7 matching during some 1 From Environmental Protection Agency.
2 Refer to the RPS Guidebook at https://www.energy.ca.gov/programs-and-topics/programs/renewables-portfolio-standard. 3 From PCE 2020-2025 Strategic Plan.
periods of the year. 24/7 matching can be more expensive than annual accounting but will also result in greater emissions reduction.
The term “clean power” or “clean energy” is often used interchangeably to reference renewable and/or carbon-free energy, but it has no consistent definition, and we are not relying on these terms during this process.
Possible Answers
Resolution of this question will require a policy position that provides enough specificity for staff to be able to manage to clear goals and for PCE to communicate clearly with customers and the public. At the same time, it must equip PCE to adapt to the evolving energy landscape.
Previous policy has been to keep PCE’s energy rates “reasonable” — which has meant approximately 5% less than PG&E’s comparable rates — while seeking to achieve a 24/7 time-coincident renewable energy goal. PCE now seeks to improve this strategy by more clearly delineating the factors that contribute to “clean” energy and assessing how to prioritize those factors in its procurement decisions.
The policy options that follow were developed by PCE senior staff — informed by conversations at the August Ad Hoc Committee and September all-staff retreat — in order to provide examples of how this critical question might be answered. We are now seeking additional input into the options — or policy answers — PCE might adopt to answer this question. We are not trying to identify the “right option” during the Board retreat. The questions for the Board to consider are:
▪ How do you think PCE should balance the four factors (see above) driving procurement decisions? ▪ What else should PCE be considering during procurement decision-making and priority setting? ▪ What else do you need to know when voting on a PCE policy in this area?
Question One Policy Options
As noted above, the following options are offered as a way to consider the question of balancing customer affordability while maintaining aggressive renewable and carbon-free energy goals. These are not offered as rigid options but rather to be used to spur discussion, questions, and direction.
Option A:
Prioritize GHG Reduction
Option B:
Balanced Priorities (Status
Quo)
Option C:
Most Affordable
Factors
Prioritize in this order:
1. 24/7 as soon as possible
2. Renewable (100% on annual
basis by 2030)
3. GHG-free energy on an annual
basis
4. Affordability
Factors
Prioritize in this order:
1. GHG-free energy on an annual
basis
2. Affordability
3. Renewable (100% on annual
basis by 2030)
4. 24/7
Factors
Prioritize in this order:
1. Affordability
2. GHG-free energy on an annual
basis
3. Renewable (100% on annual
basis by 2030)
4. 24/7
Result
In order to prioritize 24/7 matching,
PCE would forego affordability and
annual GHG-free goals in exchange
for building and operating a power
portfolio that matches renewable
energy supply to customer demand
each and every hour of the day. PCE
would build new resources (solar
plus storage, stand-alone storage,
wind, and geothermal) that would
displace the most emission-intensive
natural gas generation. This
approach would be significantly
more expensive than the status quo.
Result
Option B reflects PCE’s current
approach, which is to prioritize retail
products that minimize emissions on
PCE’s Power Content Label to
illustrate 100% GHG-free electricity
and a low carbon content on an
annual basis. Low emissions are
aligned with PCE’s founding mission
and are key to PCE’s reputation with
its customers. Affordability is
secondary to PCE’s annual
emissions. For example, in early
2024, PCE’s Board adjusted its
100% renewable goal to 2030 and
modified the 24/7 matching goal
based on affordability concerns.
Result
Option C emphasizes customer
affordability by meeting minimum
mandated content requirements, and
only exceeding those requirements if
renewable energy is cheaper than
alternatives. This would slow and
potentially reverse PCE’s emissions
reductions. This option would conflict
with PCE’s currently stated primary
mission of reducing emissions and
would likely lead to reputational
damage among our customers, peer
agencies, and regulators.
24/7 matching and renewable
content will fluctuate depending on
market conditions.
Question Two: How can PCE continue to deliver programs and services within an equity framework while also scaling decarbonization?
Context
PCE continues to invest a significant amount of its generation/ratepayer revenue in developing and delivering customer programs. PCE’s customer programs are aimed at decarbonizing homes and businesses in PCE’s service area while also considering equity goals (e.g., supporting low-income customers or customers that have been historically underserved by energy programs). Currently, PCE invests approximately 25% (or an average of $8 million per year) of its ratepayer-funded program budget in serving low-income customers. This percentage does not reflect additional funding that PCE is and will seek from external public funding sources that benefit PCE’s low-income customers, such as the DAC-GT program, Self-Generation Incentive Program, and Equitable Building Decarbonization program. The financial impact of these public funds targeted toward low income and/or equity programs is expected to be ~$9 million in 2025. These numbers also do not include any rates initiatives that PCE offers to low-income customers (e.g. freezing rates at previous levels or the December 2023 $300 bill credit to CARE/FERA customers).
Moving forward, PCE must determine how to prioritize program spending that is funded through its ratepayer revenues.
4 For example, should PCE adjust its current spending (expressed as a percentage of the overall programs budget) to serve “equity customers”? If so, how are “equity customers” defined? And how do we balance offering programs serving equity customers with those serving both equity and market rate customers, which allows for greater levels of decarbonization? 5 Considerations include (but are not limited to):
▪ The extent to which PCE should serve all customers, regardless of wealth segment, with accessible programs to maximize impact and decarbonization
▪ The extent to which PCE should focus its ratepayer revenue-funded energy programs on equity customers to:
Address historic impacts of the fossil fuel production economy Increase access to customers that have been traditionally underserved by programs (e.g., renters)
Deliver disproportionate benefit to low-income customers Reach customers in disadvantaged communities (DACs)
▪ The right balance between improving affordability for low-income/equity customers through rates (such as rate stabilization or discounts for low-income customers) compared to energy programs (such as financial incentive programs like Home Upgrade for low-income customers) 4 PCE uses some CPUC ratepayer funds for its energy programs (DAC-GT and FLEXmarket), as well as some grant funding, but the large majority of PCE energy programs are currently funded by PCE generation revenues. This discussion focuses on how PCE generation revenues should be spent on programs, not public funding (which typically comes with its own set of rules and requirements).
5 Serving low-income customers via programs tends to be more expensive on a per-capita basis as those customers will need more financial assistance to implement decarbonization measures than non-low-income customers.
Of note, PCE developed a Diversity, Equity, Accessibility and Inclusion (DEAI) framework in 2022 that outlines PCE’s commitment to accessible and inclusive policies, programs and practices across the organization and within all of PCE’s workstreams. The questions posed here address just a small subset of PCE’s DEAI commitment as it specifically relates to future program funding for disadvantaged/equity customers.
Definitions
Equity customer: PCE is using this as the “umbrella” term for all customers that we define as (1) historically underserved; (2) are low income and/or low wealth; (3) have been negatively impacted by the fossil fuel economy, and (4) live in a disadvantaged community (DAC).
Underserved Customers: Customers who have been historically underserved by California’s energy programs and services due to income, wealth, geography, redlining or other forms of racism, cultural biases, language barriers, discrimination, or structural challenges for serving them.
Low-income Customers: Customers with household incomes at or below 80% of San Mateo’s or Los Banos’ area median income (AMI).6In PCE’s service territory there are approximately 56,000 customers that are at or below 80% AMI, which represents about 20% of PCE’s residential customer accounts.
Low-Wealth Customers. Low wealth is often measured by housing burden: as described by the National Equity Atlas, a low wealth household spends more than 30 percent of income on housing costs and severely cost-burdened spending more than 50 percent of income on housing.7 Historically Impacted Communities: Neighborhoods or groups of people that have disproportionally borne the negative impacts and burdens of fossil fuel production.
Disadvantaged Communities: Disadvantaged communities (DAC) refer to the areas throughout California that suffer most from a combination of economic, health, and environmental burdens.
These burdens include poverty, high unemployment, air and water pollution, presence of hazardous wastes as well as high incidence of asthma and heart disease. California’s official definition of DAC is the top 25% of census tract per the CalEnviroScreen (CES) tool.8 Around 23,000 of PCE’s customers are located in the top 25% of DACs, which represents around 8% of PCE’s residential customer accounts.
Possible Answers
The policy options that follow were developed by PCE senior staff — informed by conversations at the August Ad Hoc Committee and September all-staff retreat — in order to provide examples of how this critical question might be answered. We are now seeking additional input into the options — or policy 6 Per the US. Department of Housing (HUD). See at
https://www.huduser.gov/portal/datasets/il/il2024/select_Geography.odn. 7 National Equity Atlas.
8 See CES tool at https://oehha.ca.gov/calenviroscreen/report/calenviroscreen-40. PCE’s DEAI Framework has established a different definition than the State’s definition for DACs (including renters, families of Title 1 school etc.).
We are proposing to update the definitions under the DEAI Framework with the definitions used in this Strategic Plan once finalized.
answers — PCE might adopt to answer this question. We are not trying to identify the “right option”, or a specific percentage carve out in this meeting today.
The questions for the Board to consider are:
▪ Which equity customer segments should PCE prioritize serving with its own generation/ratepayer funded revenue (vs. use of additional public funding)
▪ How should PCE balance its programs funding considering a desire to achieve two goals: to decarbonize and to serve equity customers?
▪ How do rate discounts and periodic rebates factor into this discussion? ▪ What else do you need to know when voting on a PCE policy in this area? Option A – Greater Focus on Equity Programs: PCE will invest more of its generation/ratepayer-funded revenues into programs to serve Equity customers, while taking every step possible to achieve PCE’s decarbonization goals (for example, seeking to spend about three quarters of the programs budget on programs serving Equity customers).
Option B – Parallel Focus: PCE will invest its generation/ratepayer-funded revenues into programs that achieve the greatest level of decarbonization and will meet established goals for serving equity customers (for example, seeking to spend about half of the programs budget serving Equity customers).
Option C – Greater Focus on Decarbonization Programs: PCE will invest its generation/ratepayer funded revenues into programs based primarily on achieving the greatest level of decarbonization and will meet its Equity goals through other resources and investments such as rate and bill assistance (for example, not setting aside a specific portion of the budget on programs serving Equity customers). Equity customers would still be served under programs but not an explicit carve out and would be primarily resourced through external, public funding.
Question Three: Are there any new or modified lines of business that PCE should engage in to further support decarbonization and electrification in California? Context
PCE focuses on providing electrical service to its customers while PG&E provides delivery (i.e., transmission and distribution (T&D)) services. PCE’s core competencies include (1) the procurement of centralized, large-scale front-of-the-meter (FTM) generation and storage projects (supply-side) and (2) offering beneficial energy programs to its customers for a variety of behind-the-meter (BTM) solutions (demand side). As California moves towards the decarbonization and electrification of its energy demand, PCE needs to have confidence that the T&D grid can support that shift. In the longer term, as distributed energy generation grows, PCE’s generation revenues could decrease, which may ultimately yield an unsustainable business model.
PCE must consider if there are other lines of business that it should engage in, or if its existing lines of business should be modified to adjust to new and emerging realities during California’s transition to a decarbonized and electrified grid.
Definitions
Electrical service: Provision of electricity to end users.
Transmission system: The bulk movement of electrical energy from a generating site, such as a power plant, to an electrical substation (where it transitions to a distribution system)9.
Distribution system: Local wiring between high-voltage substations and customers10.
Delivery service: Includes both transmission and distribution (T&D) services.
Front of the Meter (FTM): Encompasses all electricity produced on the utility side of the meter and interconnected to the transmission and distribution (T&D) grid.
Behind the Meter (BTM): Encompasses electricity produced on the customer’s side of the meter (i.e. at a customer site).
Distributed Energy Resources (DER): DERs are assets on the distribution grid, either connected behind the meter or in front of the meter. They can be used individually or in aggregate to provide value to the grid and individual customers.11
Possible New or Modified Lines of Business
The goal of this conversation is to provide input into potential new lines of business, or how PCE might modify existing lines of business, to further support California’s transition to a decarbonized and electrified grid. The “blue sky” list below includes several opportunities PCE could consider. PCE is not able to pursue all these options; through this process we will seek to identify the highest priority issues to address now, while others may not be of interest or could be considered at a later time. The opportunities identified below are not listed in any order of priority.
1. Energy and Decarbonization Consulting & Technical Assistance Consulting Services: Offer low-cost consulting for businesses and local government entities with environmental, social, and governance (ESG) goals. For example, PCE has a very successful reach codes program but could develop additional services for local government agencies.
Concierge Services: Launch personalized energy services to commercial and residential customers, potentially charging for premium services like energy system management and consultation for architects and homebuilders.
9 From Wikipedia.
10 From Wikipedia.
11 Definition from current PCE Programs Team usage.
CCA Consulting: Provide consulting to help other communities design and implement community choice aggregations (CCAs).
PCE University: Facilitate clean energy education programs, potentially charging tuition to fund operations and outreach.
2. Diversifying PCE’s Energy Supply
Behind the Meter Approach (BTM) – Continue to Grow Virtual Power Plants (VPP): Building on the recently issued request for proposal (RFP) for a distributed energy resource management system (DERMS), leverage customer-sited assets to create a VPP, optimizing decentralized energy systems for grid flexibility and reliability.
Front of the Meter Approach (FTM) – Support the Development of Smaller, Distribution-Connected Projects: At this time, PCE is focusing on contracting with large, centralized FTM projects connected to the transmission grid, as well as the installation of customer-sited, or BTM, energy resources. PCE could further support the “missing middle” by focusing on the development of FTM, distribution-connected projects located in load pockets in PCE’s service area. Examples include:
▪ Community-Scale Microgrids: Develop multi-customer microgrids in areas with frequent grid outages to increase community resilience.
▪ Community Solar (or Solar + Storage): Decentralize energy procurement and provide an alternative to customers who cannot install BTM solar + storage.
3. Transmission and Distribution Infrastructure Advocacy Enhance PCE’s ability to engage more deeply in policy development and advocacy to ensure that the transmission and distribution grids are set up to serve increasing electrification demands in an affordable manner. This includes, but is not limited to, engagement in:
Expansion of the CAISO Market: Continue engagement in expansion and regionalization discussions at the California Independent System Operator (CAISO)12 CPUC High DER Proceeding: Developing systems and processes for improved distribution system planning, data availability, and consideration of a Distribution System Operator (DSO) model13
CPUC Energization Proceeding: Establishing timelines for interconnecting distributed energy resources to the grid14
4. Financial Services and Partnerships
Partner with Banks: Collaborate with financial institutions to provide expanded decarbonization programs both in total customers reached and into segments not currently served such as commercial or large energy consumers:
12 Learn more at: https://www.caiso.com/about/our-business/regional-collaboration. 13 Learn more at: https://www.cpuc.ca.gov/industries-and-topics/electrical-energy/infrastructure/distribution-planning. 14 Learn more at: https://www.cpuc.ca.gov/industries-and-topics/electrical-energy/infrastructure/energization.
▪ Offer BTM solar and storage via Power Purchase Agreements (PPAs) to select customers, with a financial model that reduces PCE power resources costs and/or generates revenues. ▪ Implement lease-to-own models for solar battery storage, allowing more customers to access renewable energy solutions.
▪ Continue to incentivize EV charging infrastructure, and consider operating chargers, offering discounted rates to equity customers, and setting different pricing structures to meet emission reduction and equity goals.15
Financing Products: Offer on-bill financing to customers, expanding to higher percentage loans with varying interest rates based on financial need.16
5. Neighborhood Decarbonization Zones
Engage in State and utility initiatives that promote the electrification of entire neighborhoods with the goal of removing the need for gas service. Create a replicable model that can change regulation and support energy independence of communities.
The questions for the Board to consider are:
▪ Which opportunities seem most relevant or important for PCE to consider over the next five years? ▪ Should PCE consider adding or expanding any lines of business not expressed here? ▪ What other factors should PCE be considering within this discussion? Future Value Proposition
Historically, PCE’s value proposition has been the ability to deliver both “cleaner” (GHG-free and renewable) and cheaper energy. As described in the Context section of Question 1 below, PCE’s value proposition is changing as its long-term contracts come on-line and all load serving entities (LSEs), including CCAs, are required to provide 100% zero carbon energy by 2045.
PCE will need to construct a new, sustainable value proposition. The factors below, developed at the August Ad Hoc Committee in-person strategy session and advanced further at the September all-staff retreat can serve as a starting point for that effort.
What could our future value proposition be?
▪ 24/7 Time-Coincident Renewable Energy: Prioritizing round-the-clock access to renewable energy as a differentiating strength.
▪ Not-for-Profit Structure: Focusing on community reinvestment, with no shareholders or profit-driven motivations. ▪ Local Focus: Serving as a trusted, community-led energy provider with elected officials on the Board and a strong local presence.
15 Support for electrification of public transit has been identified as an option but was removed from this list because other agencies are focused on this need.
16 PCE may be limited by regulations in the financing tools or structures it may offer.
▪ Innovative Model: Developing new approaches to industry challenges that work for our local community and serve as a model across the state and country. ▪ Customer-Centric Approach: Offering easy ways for customers to learn and benefit from savings on energy decisions, electrification, and emissions reductions, built through trust-building with customers.
▪ Affordability: Maintaining lower rates compared to competitors like PG&E, while balancing between affordability and decarbonization goals.
▪ Trust and Transparency: Building and maintaining trust by being a resourceful, transparent partner in energy decisions.
▪ Nimble and Efficient: Avoiding bureaucratic hurdles to remain responsive and agile in meeting community needs, maintaining commitment to progress, and getting things done.
What new strengths do we need?
▪ Focused Support for Low-Income and Disadvantaged Communities: A better distinction in policies and programs to address the specific needs of these groups. ▪ Expanded Direct Customer Support: Launching the contact center and providing more human, face-to-face interactions.
▪ Customer-Centricity: Aligning policies with customer needs and creating mindsets, platforms, and processes to make customer-centricity real, not just aspirational. ▪ Proactive Communication and Adaptability: Listening to customers, acting quickly, and communicating changes effectively.
▪ Anticipating Technological Changes: Keeping costs low by anticipating changes in technology and procurement strategies.
▪ Energy Equity: Driving structural changes to support equity and lower customer rates. ▪ Innovative: Leveraging the Agency’s business model to take reasonable risks and innovate.
Current Strengths to Reinforce
▪ Mission-Centricity: Continuing to leverage the Agency’s mission-focused structure to attract and retain a dedicated, talented team.
▪ Trusted Community Partner: Building on the organization's role as a trusted advisor and neighbor within the community.
▪ Cost Leadership: Maintaining a lower cost structure compared to competitors like PG&E. ▪ 24/7 Renewable Energy Progress: Focusing on making strides toward delivering 24/7 time-coincident renewable energy. ▪ Diverse Program Portfolio: Offering a variety of programs and support tools, such as financing, rebates, and technical assistance, tailored to customer needs. ▪ Communication on Emissions and Renewable Energy: Improving how greenhouse gas reduction and renewable energy goals are communicated.
▪ Nimbleness and Adaptability: Continuing to act quickly on customer feedback and changing needs, without being constrained by regulations like investor-owned utilities (IOUs). ▪ Nonprofit Advantages: Reinforcing the organization’s ability to focus solely on customer benefit rather than shareholder profit, with flexibility in spending on pro-community and pro-consumer projects.
▪ Efficient Staffing and Resource Allocation: Leveraging a lean staff structure for more efficient program implementation.
Decision-Making Criteria
Before implementing any new strategy or making significant decisions, PCE will need to assess each proposal using specific decision-making criteria. These criteria do not function as a rigid framework or a set of absolute values, but rather as a guide that ensures decision-makers examine relevant factors to challenge assumptions and avoid skipping over inconvenient truths. It can be used at various levels and stages of decision-making to ensure PCE maintains its “north star.” Below is an initial draft of PCE’s decision-making criteria, developed at the August Ad Hoc Committee in-person strategy session and advanced further at the September all-staff retreat. These criteria will be refined further by Board feedback and by staff as the process progresses.
Does/Is this decision (both independently and compared to other options) … ▪ Advance maximum mission and strategic impact:
Further our goals to encourage greenhouse gas reduction and promote electrification locally within our communities?
Represent sustainable (socially, economically, environmentally), measurable, and describable energy benefits to the communities we serve?
▪ Leverage or build out PCE’s Value Proposition?
▪ Advance our commitment to equity:
Enhance equitable access to the benefits of cleaner energy production, reduced greenhouse gas emissions, and electrification for individuals and communities most in need? Align with our DEIA framework?
▪ Advance positive customer and community impact:
Enable quick action on customer needs (explicit and latent)? Unlock future options to further innovate and provide additional benefits? Result in positive learning or influence that extends outside of our service area ▪ Align with our financial sustainability:
Address economic impacts that are the foundation for PCE’s financial sustainability? Account for implementation costs for both PCE and its customers? ▪ Enhance the value of PCE’s current portfolio of service offerings via cost reductions, better service efficiencies, technology and customer information enhancements, or new ways to utilize / maximize benefit of interacting with our organization?
▪ Account for operational impacts:
Consider PCE’s ability to deploy current staff or add new staff to address capacity and expertise needed
Assess impacts on current load profile (e.g., daylight v. nighttime load requirements) Include an analysis of potential risks, including financial, energy, reputational, and legal risks ▪ Meet compliance, policy and political needs
Meets PCE’s compliance requirements?
Enhance PCE’s community reputation as a trusted and transparent agent of change?