Peninsula Clean Energy
Board of Directors
Meeting
June 26, 2025
This Meeting will begin shortly! Thank you!
Agenda
Call to Order / Roll Call
Public Comment (for items not on the Agenda)
• Please note, send any chats to Administrative Assistant, Brianna Arroyo Action to set the Agenda and Approve Consent Items 1-4
• Consent - Public Comment
Regular Agenda
Closed Session
Adjournment
Chair Report (Discussion)
CEO Report (Discussion)
CEO Report: General Matters
Wright BESS Contract Update
• Contract signed and effective on 6/11/25 with 2 execution amendments tied to the outcome of Federal HB1/ITC changes
Self Generation Incentive Program (SGIP) update
• Regulatory hurdles to program launch
GovPV Solar Installations Live
• Atherton City Hall, Colma Community Ctr, Millbrae Chetcuti Ctr EV Charging Ribbon-Cutting
• 92 port multi-family project in East Palo Alto – June 28th CEO Report: 2025 Joint Rate Mailer (JRM)
CEO Report: Voice of the Customer Initiative
Objective: Establish a structured program that delivers qualitative and quantitative customer feedback to inform marketing, programs, experience design Summer pilot: Community Relations, SeeChange Institute & PCE intern focus on feedback from workshops, events, focus groups, and interviews Strategic value to PCE
• Customer-centricity: Supports agency goal of delivering high-impact, customer-driven programs and tools
• Insight-driven planning: Builds PCE’s ability to align offerings with customer needs and climate goals
• Capacity building: Empowers staff with tools and training to carry it forward in-house CEO Report: June Legislative Update
Pathways Initiative SB 540 (Becker)
• PCE Legislative Committee: Report Out From Meeting
REACH Codes AB 306 (Rivas)
BESS Bill SB 283 (Laird):
• Assembly Utilities & Energy; Local Government
Affordability Initiatives: SB 254 (Becker) & AB 825 (Petrie-Norris) State Budget Update:
• Legislative Deadline Met – Negotiations Ongoing - Trailer Bills to Follow
8 Reconciliation in the Senate:
• On June 16, 2025, the Senate Finance
Committee released its version of the
reconciliation bill
• Clean Energy Tax Credits continue to
be at risk and sourcing of supplies
remains a critical component
• Senate Parliamentarian has ruled on
Medicaid Cuts
• July 4 deadline is uncertain to be
met
CEO Report: Federal Impacts Update
Diablo Canyon - September 28-29
CAISO #2 – TBD - November 13th
And don't forget your subscription to Blue
Ocean Brain on-line learning platform!
CEO Report: Board & Staff Education Trips
CEO Report: June and July Community Events
11 June 28 – Woodland Creek Ribbon Cutting, East Palo Alto July 10 – Daly City Partnership Focus Group
July 14 – Climate Resilient Communities Focus Group,
East Palo Alto
July 25 – Family Resource Day, Daly City
CEO Report: Staffing Update
Katarina Malmgren, Power Resources Analyst, starting July 1 Upcoming Meetings – July 2025
Community Advisory Committee:
• Thursday, July 10 at 6:30 p.m.
Executive Committee:
• Monday, July 14, at 10:00 a.m.
Board of Directors Meeting:
• Thursday, July 24 at 6:30 p.m.
Audit and Finance Committee:
• Monday, August 11 at 8:30 a.m.
• Special Meeting September 8 at 8:30 a.m.
Please note: July meetings will proceed as scheduled, August meetings will likely be cancelled
Community Advisory Committee Report
Public Hearing:
Update on AB 2561
Leilani Johnson, Director of People
and Culture
What is AB 2561?
16 Public Hearing Requirement: Public agencies must conduct a public hearing at least once per fiscal year to discuss the status of their vacancies, recruitment, and retention strategies.
Focus on Recruitment and Retention: The bill aims to shed light on public sector staffing challenges and encourage transparency and collaboration between agencies and employee representatives.
AB 2561 became effective on January 1, 2025.
AB 2561 is a California law that requires public agencies to hold an annual public hearing to present information about their job vacancies, recruitment, and retention efforts.
AB 2561: PCE F25 YTD
17 Challenges faced in hiring:
- Finding talent that brings both the skills & experience needed AND are great “culture adds” for PCE can take
time; and,
- PCE continues to refine and expand its DEAI
recruitment efforts to hire the best candidates.
What PCE has going for us?
- A strategic, structured approach to recruitment
- 94.5% of PCE’s staff sees themselves continuing to
work for PCE for the next 3 years
- PCE offers competitive compensation & benefits
- Our culture is highly attractive to great candidates:
we are mission-driven, highly diverse, remote-first
FY 2024 – 2025 Budgeted Headcount
Total FTE Budgeted 63
New FTE Added In F25 13 + 3 Interns
New FTE Filled as of 6/26/25 13 + 3 Interns
Average Time to Hire 42 Days
Retention Rate 96.8%
Average Turnover Rate 3.2%
*Reporting period: F25 – July 2024 – June 2025 (YTD at time of report) *Average Time to Hire: Days from role posted to offer acceptance *FTE: Full-time employee; YTD: Year-to-date
This slide and data presented ensure compliance to AB 2561, which requires local public agencies to present the status of vacancies and recruitment and retention efforts at a public hearing before the governing board of the local agency at least once per fiscal year.
Approval of the Fiscal
Year 25-26 Budget
(Action)
Nick Bijur, Chief Financial Officer
Process Overview
19 • Draft budget presented to the Audit & Finance Committee on May 12 o Committee supportive
• Updated budget presented to the Audit & Finance Committee and the Executive Committee on June 9 o Only material change since initial draft was updated rate assumptions and revenues (both lower) in consideration of the PCIA Proposed Decision, which, if adopted, will result in a higher PCIA in 2026 o Both Committees unanimously recommended approval of the budget with minor suggested changes • Final budget being presented to the Board of Directors for approval o Total costs of $392 million, representing a 4% decrease from FY25 due to lower energy costs • Recommendation to maintain rates at a 10% discount to PG&E – no rate change in July o Revenues of $381 million, representing a 16% decrease from FY25; assumes ~35% rate reduction in February 2026 (in line with expected increase in the PCIA and PG&E generation rate reduction) o Staff will return to the Board in January 2026 with a budget refresh and rate recommendation FY 2025 FY 2026
$ in millions Updated Fcst Budget $ %
Energy $224.6 $238.2 $13.5 6%
Capacity 120.7 67.6 (53.1) -44%
REC/GHG-Free 12.2 7.6 (4.6) -37%
Other 3.9 3.2 (0.7) -17%
Contingency - 21.0 21.0 n/a
Cost of Energy $361.4 $337.6 ($23.8) -7%
Variance vs FY25
Cost of Energy
$24 million decrease (-7%) in cost of energy vs FY25
• Significantly lower Resource Adequacy (RA) prices (~$12 vs ~$33) • Lower REC/GHG-Free prices, nuclear allocation and increased PPA generation • Offset in part by forecasted load growth and contingency (~7% of costs) 20 FY 2025 FY 2026
$ in millions Updated Fcst Budget $ %
Buildings $6.5 $13.3 $6.8 105%
EV 3.3 3.7 0.4 11%
DER 0.6 2.4 1.8 306%
Grants/ Govt 7.0 2.2 (4.9) -69%
Other 0.1 0.2 0.1 74%
Total $17.5 $21.7 $4.2 24%
Variance vs FY25
Programs - Expense
$4.2 million increase (24%) in Programs expense
• Buildings
• Direct install (home upgrade) ramp-up after initial “startup” phase
• Increased marketing efforts should drive higher spend • Grants
• Wind down of Surplus Fund allocation; seven outstanding agencies due to timing issues and slower approval process • Distributed Energy Resources (DER)
• Surplus Funds for GovPV storage
• Residential DERM platform subscription
costs (Lunar)
• Electric Vehicles (EV)
• Program stability
21 FY 2025 FY 2026
$ in millions Updated Fcst Budget $ %
GovPV $11.9 $20.0 $8.1 68%
On-Bill Financing 5.0 6.0 1.0 19%
GovBE 1.8 0.6 (1.2) -67%
Resi ESS 0.4 3.0 2.6 650%
Total $19.1 $29.6 $10.5 55%
Variance vs FY25
Programs - Capital
$10.5 million increase in Programs capital
• Largely due to GovPV
• Residential solar and storage program launched
• GovBE driven by expected decrease in demand
22 Operating Expenses
• Compensation: Salary increase (~5.5%) and additional headcount (5) • Consultants: Additional support for Power Resources and HR • Legal: Innovation Strategies department and Power Resources • Communications: Increased paid advertising and portable battery program pilot • G&A: Increased software (+$500k) and subscription costs 23 FY 2025 FY 2026
$ in millions Updated Fcst Budget $ %
Compensation $14.2 $16.4 $2.2 16%
Data Manager 3.5 3.6 0.0 1%
Service Fees - PG&E 1.3 1.3 0.0 0%
Consultants & Professional Svcs 1.6 2.1 0.4 27%
Legal 1.0 1.2 0.2 24%
Communications and Noticing 2.7 3.3 0.5 19%
General and Administrative 3.5 4.5 0.9 27%
Variance vs FY25
PCIA Update
24 • Due to volatility in the energy markets and potential changes to the PCIA calculation methodology, staff expects the PCIA to increase significantly and PG&E generation rates to decrease in January 2026
o RA and REC prices lower in 2025 than forecasted, and expected to further decline in 2026, which will increase the PCIA in 2026
o CPUC Proposed Decision adjusts the methodology for calculating the PCIA, which, if approved, will increase the PCIA in 2026
o In addition, PG&E’s recent ERRA filing proposes several additional adjustments to the PCIA which would further increase the PCIA – unclear which proposals, if any, will be approved (currently not included in our forecast)
o As a result, “rate parity”, the rate at which PCE would need to set rates to be equal to PG&E, will decrease significantly in 2026
Ilustrative Impact of PCIA
25 $0.140
$0.035
$0.091
$0.000
$0.020
$0.040
$0.060
$0.080
$0.100
$0.120
$0.140
$0.160
$0.180
PG&E Customers PCE Customers
2026
PCIA PCE Gen Rate
$0.160
$0.010
$0.134
$0.000
$0.020
$0.040
$0.060
$0.080
$0.100
$0.120
$0.140
$0.160
$0.180
PG&E Customers PCE Customers
2025
PCIA PCE Gen Rate
10% Discount ($0.144)
10% Discount ($0.126)
~30% Decline
Cost-of-Service Rate Setting
26 ~$375M
Cost-of-Service Revenue Requirement Discount/Premium
10% Discount
Recommendation to maintain rates at 10% discount throughout the fiscal year • Assumes ~35% rate decrease in Feb 2026 to coincide with anticipated PG&E and PCIA rate changes (will return to Board in January 2026 for approval) $ millions FY26 Budget
Total Agency Costs $392.0
Non-Electricity Sales (3.9)
Interest Income (14.9)
Net Costs $373.2
FY 2026 Budget
27 Recommend approval of FY26
Budget
• Assumes PCE maintains rates at a 10%
discount throughout the fiscal year
o Will return to the Board in January
with “budget refresh” and
recommendation for a potential rate
decrease of ~35%
• Total costs of $392 million, a 4%
decrease vs FY25
• Change in Net Position of $4 million
(1% of revenues)
FY 2025 FY 2026
$ in millions Updated Fcst Budget % Change
Electricity Sales $441.2 $377.1 -15%
Non-Electricity Sales 13.6 3.9 -71%
Total Operating Revenues 454.8 381.1 -16%
Cost of Energy 361.4 337.6 -7%
Revenue less Energy Costs 93.4 43.4 -54%
Programs 17.5 21.7 24%
Compensation 14.2 16.4 16%
General & Administrative 13.9 16.3 17%
Operating Expenses 45.6 54.3 19%
Operating Income 47.8 (10.9) -123%
Interest Income 22.0 14.9 -32%
Change in Net Position $69.7 $4.0 -94%
Discussion of Rate
Stabilization Fund and 5-
Year Forecast
Nick Bijur, Chief Financial Officer
FY 2026 FY 2027
$ in millions Budget Forecast
Revenues $381.1 $406.0
Cost of Energy 337.6 352.2
Revenue less Energy Costs 43.4 53.8
Programs 21.7 27.1
Compensation 16.4 18.1
General & Administrative 16.3 16.4
Operating Expenses 54.3 61.6
Operating Income (Loss) (10.9) (7.8)
Interest Income 14.9 12.3
Change in Net Position $4.0 $4.5
Disc/(Prem) to PG&E 10% -22%
FY 2027 Forecast
• Assuming cost-of-service
ratemaking, PCE would need to
collect approximately $400 million
of revenues in FY27
o Revenues sufficient to recover
costs
• Resulting PCE rates would be at a
22% premium to PG&E
o Due to an expected increase in
the PCIA and decrease in PG&E
generation rates in 2026
• Scenario excludes impact from the
Rate Stabilization Fund, which can
be used to help stabilize and lower
rates
29 Rate Stabilization Fund Background
30 • Board approved establishment of a Rate Stabilization Fund in May 2024 o Allows PCE to defer revenues in years when financial results are strong to be used in future years to help “stabilize” / supplement rates
o Staff will consider deferral of revenues into the Rate Stabilization Fund when the addition to Net Position is greater than 3% of revenues o Deposits can be made into the Rate Stabilization Fund until the balance equals 15% of revenues
• PCE deferred $68 million of revenues in FY24, representing 15% of revenues • Most peers have Rate Stabilization Funds (Ava, Sonoma Clean Power, MCE, Clean Power Alliance, Orange County Power Authority and San Jose Clean Power); Silicon Valley plans to implement this year
o Balances as a percentage of revenues range from 9 – 20%; however, likely that peers will add to their Rate Stabilization Funds this year due to favorable financial results No RSF With RSF
$ in millions FY 2027 FY 2027
Operating Revenues $406.0 $301.0
Rate Stabilization Fund - 105.0
Revenues 406.0 406.0
Total Net Costs 401.5 401.5
Change in Net Position $4.5 $4.5
Disc/(Prem) to PG&E -22% 5%
Rate Stabilization Fund (RSF) Recommendation
31 • Providing a 5% discount generates only
$300 million in revenues
• Requires recognition of $105 million of
deferred revenues, which exceeds
PCE’s current Rate Stabilization Fund of
$68 million
• As a result, staff recommends a
temporary waiver of our Rate
Stabilization Fund limit, which will
allow PCE to defer additional revenues
in FY25 (exact amount to be
determined)
o Deferring $37 million of revenues
will increase the Rate Stabilization
Fund to $105 million, which
represents 23% of revenues
(current limit of 15%)
5-Year Forecast
Nick Bijur, Chief Financial Officer
FY 2025 FY 2026 FY 2027 FY 2028 FY 2029 FY 2030
$ in millions Updated Fcst Budget Forecast Forecast Forecast Forecast Operating Revenues $454.8 $381.1 $301.0 $418.7 $447.9 $456.9 Rate Stabilization Fund (37.0) - 105.0 - - -
Revenues 417.8 381.1 406.0 418.7 447.9 456.9
Cost of Energy 361.4 337.6 352.2 363.6 386.7 398.3
Revenue less Energy Costs 56.4 43.4 53.8 55.1 61.1 58.7 Programs 17.5 21.7 27.1 27.7 27.7 27.2
Staff Compensation 14.2 16.4 18.1 19.6 20.6 21.6
General & Administrative 13.9 16.3 16.4 17.2 17.6 18.1
Operating Expenses 45.6 54.3 61.6 64.5 65.8 66.8
Operating Income (Loss) 10.8 (10.9) (7.8) (9.4) (4.7) (8.1) Interest Income 22.0 14.9 12.3 10.5 10.4 10.3
Change in Net Position $32.7 $4.0 $4.5 $1.2 $5.8 $2.2
Discount/(Premium) to PG&E ~7% 10% 5% 5% 5% 5%
5-Year Forecast
Forecast includes utilization of Rate Stabilization Fund 33 Cash and DCOH Forecast
$429
$405
$298 $293 $291 $286
385 378
263
251 235 225
0 50
100
150
200
250
300
350
400
450
500
$0
$50
$100
$150
$200
$250
$300
$350
$400
$450
$500
2025 2026 2027 2028 2029 2030
DCOH
Cash ($M)
Cash DCOH Target DCOH
34 $130 million decline in cash
over the next two years
Approval of the Second
Amendment to the
Agreement with Shawn E.
Marshall, Chief Executive
Officer (Action)
Donna Colson, Board Chair
Board Members’ Reports
Peninsula Clean Energy
Adjournment
Peninsula Clean Energy