Audit & Finance
Committee
Meeting
September 8, 2025
The 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 Item 1
• Consent - Public Comment
Special Agenda
Adjournment
Chair Report
Staff Report
Staff Report
5 • Prepay #2
• S&P Outlook Revised to “Positive” on August 28
• Annual audit underway and on-track for October
• Issued $1.3 million Letter of Credit for the benefit of PG&E o CPUC recently approved updated Financial Security Requirement (FSR) calculation related to Provider of Last Resort (POLR)
o Replaced $147k escrow account
o To be recalculated twice a year – amount could increase significantly • Enterprise Risk Management (ERM) program launched
Discussion of
Possible Future
Prepay Transaction
Background
7 • PCE executed first Prepay in October 2024, which included the issuance of $960 million of CCCFA tax-exempt bonds and assignment of four PPAs representing 881k MWhs per year, ~25% of PCE’s annual load
• Transaction well timed and very successful, generating savings of 12.3%, an average of $5.7 million per year over initial 8 years
• Post-execution administration has gone smoothly and PCE realizing monthly savings • Since PCE’s transaction, there have been 8 Prepay transactions from peer CCAs, all of which generated customer savings of at least 10.5%
• Staff has begun preparing for a second Prepay transaction, likely of similar size • While the Prepay market is not as favorable as last year, PCE’s advisors recommend being ready to access the financial markets for when/if conditions improve • Of note, Silicon Valley Clean Energy and Ava Community Energy have received CCCFA Board approval and are waiting to execute respective transactions CCCFA Prepay Transactions
8 Date Project Participant(s) Par ($M) Prepaid Supplier Annual
Savings ($M) Discount
September 2021 Ava Community Energy/Silicon Valley Clean Energy $ 1,235 Morgan Stanley $ 4.1 7.9% November 2021 Marin Clean Energy 603 Goldman Sachs 2.4 10.1% July 2022 Ava Community Energy 931 Morgan Stanley 4.3 9.9% January 2023 Pioneer Community Energy 460 Goldman Sachs 2.6 12.0% January 2023 Silicon Valley Clean Energy Authority 842 Morgan Stanley 4.6 10.2% February 2023 Clean Power Alliance 999 Goldman Sachs 7.7 13.6% June 2023 Clean Power Alliance 958 Goldman Sachs 5.9 11.8% August 2023 Ava Community Energy 998 Morgan Stanley 6.5 12.2% October 2023 Central Coast Community Energy 648 Goldman Sachs 4.7 11.4% December 2023 Marin Clean Energy 1,038 Goldman Sachs 6.6 12.9% January 2024 Silicon Valley Clean Energy Authority 1,102 Morgan Stanley 7.4 13.1% August 2024 Clean Power Alliance 1,524 Goldman Sachs 11.3 13.1% October 2024 Peninsula Clean Energy 960 Goldman Sachs 5.7 12.3% November 2024 City of San José 1,243 Morgan Stanley 8.5 12.1% November 2024 Clean Power Alliance of Southern California4 1,153 RBC Capital 9.0 12.6% November 2024 San Diego Community Power 1,001 Morgan Stanley 6.7 12.0% November 2024 Sonoma Clean Power 776 Goldman Sachs 6.1 15.2% December 2024 Clean Power Alliance 1,291 Goldman Sachs 11.5 16.8% March 2025 Valley Clean Energy 493 Goldman Sachs 3.5 14.4% June 2025 Marin Clean Energy 1,063 Goldman Sachs 6.2 10.9% July 2025 San Diego Community Power 1,006 Morgan Stanley 6.1 10.5% $20,321 $131.4
Market Overview
9 PCE1 Pricing 10/1/2024
Muni Bond [A] Funding Rate [B] Prepay Spread
[B]-[A]
8-Year MMD Index 2.46 8-year UST 3.68
Credit Spread 1.15 Approx Funding Spread 1.00
Yield 3.61% Funding Rate 4.68% 1.07%
Hypothetical Today
Muni Bond [A] Funding Rate [B] Prepay Spread
[B]-[A]
8-Year MMD Index 2.86 8-year UST 4.01
Credit Spread 1.40 Approx Funding Spread 0.80
Yield 4.26% Funding Rate 4.81% 0.55
Updated Economics
10 Decreased
Spread
=
Reduced Savings
Timeline
11 Week of
Oct. 13
Week of
Oct. 6
Week of
Oct. 20
Week of
Oct. 27
Week of
Nov. 3
◼ Finalize financial model
◼ Engage Trustee
◼ Engage Rating Agency
◼ Receive Funding Recipient bids
◼ Executive Committee meeting (Oct
14)
◼ Finalize transaction documents
◼ Select Funding Recipient
◼ PCE & CCCFA Board meetings (seek approval)
◼ Receive rating from Rating Agency
◼ Receive green/climate bond opinion
◼ Due diligence calls
◼ Post offering document; start marketing
(pending market conditions)
◼ Price bonds and lock-in savings
(or later; pending market
conditions)
◼ Closing (or later)
Weeks of
Sept. 8 - 29
◼ Audit & Finance Committee
meeting (Sept 8)
◼ Prepare transaction documents
◼ Engage Green Bonds verifier
◼ Select commodity swap
counterparty
Same Prepay Deal Team
12 Municipal Advisor Prepay Counsel Conduit Issuer Prepaid Supplier Custodian / Trustee Rating Agency Bond / Tax Counsel
Peninsula Clean Energy
Entities selected
by PCE
Other Entities
in Prepay
Transaction
• Financial advisory
• Advice on structure,
timing and terms
• Fiduciary responsibility to
PCE
• PFM
• Legal advisory
• Represents PCE’s
interests
• Chapman and Cutler
• Issuer of tax-exempt
bonds
• CCCFA
• Structures transaction
• Markets and underwrites
bonds
• Goldman Sachs
• Legal services
• Affirms tax-exempt bond
status and validity of
bond offering
• Orrick
• Rates bonds
• Moody’s / S&P
• Manges prepay estate
• Bond interest payments
• US Bank
Transaction Diagram
13 Initial Issuance and Cash Flows
1. Debt Issuance – CCCFA issues tax-exempt bonds
2. Prepayment – CCCFA remits bond proceeds to Prepay
LLC in return for 30 years of assigned electricity deliveries
3. Unsecured Loan – Prepay LLC loans bond proceeds to
Funding Recipient. Funding Recipient makes fixed
monthly payments to Prepay LLC equal to assigned
electricity multiplied by PPA price
Monthly Cash / Energy Flows
4. Assigned PPAs – PCE assigns to J. Aron certain rights and obligations as Buyer; J. Aron makes monthly
payments to PPA counterparties for assigned delivered
energy
5. Electricity Supply – Prepay LLC enters into long-term agreement to purchase electricity from J. Aron to match assigned electricity quantities/terms
6. Project Participant – CCCFA sells PCE all assigned
electricity delivered by Prepay LLC at a discounted price Q4 and FY24-25
Financial Review
(in MWh) Actual Budget Variance Var (%)
Residential 1,390,074 1,446,082 (56,008) -3.9%
Commercial & Industrial 2,025,757 2,120,533 (94,777) -4.5% Total 3,415,831 3,566,616 (150,785) -4.2%
FY24-25 Base Load
Customer Load
FY 2025 load 4.2% below budget
• Lower residential load primarily due to mild first
half year
• Reduced Small Commercial load relative to pre-2022 historical levels • Staff continues to re-calibrate model to improve
performance
FY 2025 load 2.0% higher than last year
200,000
225,000
250,000
275,000
300,000
325,000
350,000
Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May Jun
Total Load (MWh)
Actuals Budget FY23-24 Actual
15 (in millions)
FY25 Q4
Actual
FY25 Q4
Budget
FY24 Q4
Actual
$Var vs
Budget
Fav/(Unf)
$Var vs
FY24 Q4
Fav/(Unf)
Electricity Sales 94.2 102.0 104.8 (7.8) (10.6)
Non-Electricity Revenues 0.8 0.8 5.5 0.0 (4.8)
Green Electricity Premium 1.1 1.1 0.7 (0.0) 0.4
Total Revenues $96.0 $103.9 $111.1 ($7.8) ($15.0)
(in millions)
FY25
Actual
FY25
Budget
FY24
Actual
$Var vs
Budget
Fav/(Unf)
$Var vs
FY24 YTD
Fav/(Unf)
Electricity Sales 434.3 451.9 442.2 (17.6) (7.9)
Non-Electricity Revenues 13.8 11.7 9.8 2.1 4.0
Green Electricity Premium 3.6 3.8 3.0 (0.1) 0.7
Total Revenues $451.7 $467.4 $455.0 ($15.6) ($3.3)
Revenues
Q4 and YTD revenues
$7.8 million, and $15.6
million below budget,
respectively
• Lower load
• Rate decrease in Feb
2025 (increased
discount to 10%)
16 Excludes impact of Rate Stabilization Fund
(in millions)
FY25 Q4
Actual
FY25 Q4
Budget
FY24 Q4
Actual
$Var vs
Budget
Fav/(Unf)
$Var vs
FY24 Q4
Fav/(Unf)
Energy 47.6 53.9 51.1 6.4 3.5
Capacity 14.3 19.1 28.0 4.8 13.7
REC/GHG-Free 16.1 3.1 (0.3) (13.0) (16.4)
Other 0.5 1.9 1.1 1.4 0.6
Contingency 0.0 5.7 0.0 5.7 0.0
Total Cost of Energy $78.6 $83.8 $79.9 $5.2 $1.4
(in millions)
FY25
Actual
FY25
Budget
FY24
Actual
$Var vs
Budget
Fav/(Unf)
$Var vs
FY24 YTD
Fav/(Unf)
Energy 224.9 251.1 225.6 26.1 0.6
Capacity 119.9 127.6 91.8 7.7 (28.1)
REC/GHG-Free 19.0 14.7 5.3 (4.3) (13.7)
Other 2.1 6.7 2.5 4.6 0.4
Contingency 0.0 29.0 0.0 29.0 0.0
Total Cost of Energy $366.0 $429.1 $325.2 $63.1 ($40.8) Cost of Energy
Q4 and YTD cost of
energy $5.2 million (6%),
and $63.1 million (15%)
below budget • Reduced load • Lower electricity and RA
prices
• Prepay savings • Higher CRR revenues • Contingency not used/ needed
• Offset in part by timing of
REC/GHG-free purchases
17 Q4 Change in Net Position (CINP)
Q4 CINP $6.8 million
higher than budget
• Lower revenues offset
by lower cost of
energy
• Operating expense
favorability due to
lower Programs spend
• Higher interest
income/gains and ITC
of $3.7 million related
to GovPV
18 (in millions)
FY25 Q4
Actual
FY25 Q4
Budget
FY24 Q4
Actual
$Var vs
Budget
Fav/(Unf)
$Var vs
FY24 Q3
Fav/(Unf)
Revenues 96.0 103.9 111.1 (7.8) (15.0)
Cost of Energy 78.6 83.8 79.9 5.2 1.4
Revenue Less Cost of Energy $17.5 $20.1 $31.1 ($2.6) ($13.7) Compensation 4.2 3.4 2.8 (0.7) (1.4)
Data Mgr and PG&E Fees 1.2 1.2 1.2 0.0 0.0
Professional Fees 0.7 0.9 0.7 0.1 (0.0)
Marketing 0.8 0.4 0.6 (0.4) (0.2)
Programs 3.5 6.8 3.6 3.3 0.1
Other G&A 1.0 1.4 0.9 0.4 (0.1)
Operating Expenses $11.4 $14.1 $9.9 $2.7 ($1.5)
Non-Operating Income 9.0 2.3 4.0 6.7 5.0
Change in Net Position $15.0 $8.2 $25.2 $6.8 ($10.2)
Excludes impact of Rate Stabilization Fund
(in millions)
FY25
Actual
FY25
Budget
FY24
Actual
$Var vs
Budget
Fav/(Unf)
$Var vs
FY24 YTD
Fav/(Unf)
Revenues 451.7 467.4 455.0 (15.6) (3.3)
Cost of Energy 366.0 429.1 325.2 63.1 (40.8)
Revenue Less Cost of Energy $85.8 $38.3 $129.8 $47.5 ($44.1) Compensation 14.6 13.6 9.8 (1.0) (4.8)
Data Mgr and PG&E Fees 4.9 4.9 4.9 0.1 (0.0)
Professional Fees 2.6 3.5 2.8 1.0 0.3
Marketing 2.7 2.7 2.2 0.0 (0.5)
Programs 14.9 27.4 13.8 12.5 (1.1)
Other G&A 3.5 5.0 3.2 1.5 (0.3)
Operating Expenses $43.1 $57.1 $36.7 $14.0 ($6.4)
Non-Operating Income 26.4 9.1 16.4 17.3 10.0
Change in Net Position $69.1 ($9.7) $109.6 $78.8 ($40.5) FY25 Change in Net Position (CINP)
FY25 CINP $78.8
million higher than
budget
• Significantly lower
energy costs
• Lower programs spend
due to program delays
(BE) and slower uptake
(EV)
• Higher interest income,
including $6 million of
investment gains, and
ITC
Excludes impact of Rate Stabilization Fund 19
(in millions)
FY25
Actual
FY25
Budget
Change in Net Position excl Rate Stabilization Fund 69.1 (9.7) Rate Stabilization Fund (Deferral)/Recognition (60.0) 15.0 Change in Net Position incl Rate Stabilization Fund $9.1 $5.3 Rate Stabilization Fund
20 Staff proposes deferring
$60 million of revenues
to the Rate Stabilization
Fund (RSF)
• To be used to offset
expected increase in
PCIA in 2026
• Total RSF balance of
$127 million
• Resulting Change in Net
Position of $9.1 million
represents 2% of
adjusted revenues and
in line with Budget
(in millions) Jun-24 Sep-24 Dec-24 Mar-25 Jun-25
Cash (JP Morgan) $16.3 $13.4 $15.5 $17.4 $14.7
CAMP 163.8 166.0 168.1 180.0 182.0
PFM 107.9 111.6 110.9 113.1 114.7
Chandler 103.5 107.1 106.3 108.5 130.1
Total Cash & Investments $391.6 $398.1 $400.7 $418.9 $441.5 Days Cash on Hand 395 365 367 374 394
Adjusted Days Cash on Hand(1) 268 251 255 265 235
Cash and Investment Summary
21 (1) Adjusted for Rate Stabilization Fund and Board-approved capital projects Appendix
Detailed Financial Statement
23 Actual Budget Var Fav/(Unf) Actual Budget Var Fav/(Unf) Electricity Sales $94,184,236 $102,003,286 ($7,819,050) $434,281,155 $451,925,086 ($17,643,931) Non-Energy Revenues 780,550 763,571 16,979 13,819,437 11,698,286 2,121,152 Green Electricity Premium 1,069,160 1,091,126 (21,966) 3,641,801 3,763,646 (121,845) Rate Stabilization Fund (60,000,000) 15,000,000 (75,000,000) (60,000,000) 15,000,000 (75,000,000) Revenue 36,033,946 118,857,983 (82,824,037) 391,742,394 482,387,018 (90,644,624) Cost of Energy 78,551,423 83,780,556 5,229,133 365,971,834 429,097,737 63,125,903 Revenue Less Cost of Energy (42,517,477) 35,077,427 (77,594,904) 25,770,560 53,289,281 (27,518,721) Compensation 4,181,679 3,448,528 (733,150) 14,610,948 13,581,323 (1,029,625) Data Manager 883,376 900,000 16,624 3,537,346 3,600,000 62,654 Service Fees (PG&E) 334,638 333,600 (1,038) 1,329,705 1,334,400 4,695 Consultants & Professional Services 480,961 508,610 27,648 1,673,579 2,144,538 470,959 Legal 267,582 348,491 80,909 901,810 1,393,965 492,155
Communications & Noticing 772,981 399,714 (373,267) 2,673,765 2,700,073 26,308 General & Administrative 914,819 1,214,167 299,348 3,365,254 4,677,376 1,312,122 Community Energy Programs 3,519,757 6,842,500 3,322,743 14,872,089 27,370,000 12,497,911 Depreciation 70,726 150,599 79,873 159,932 338,644 178,712 Operating Expenses 11,426,520 14,146,209 2,719,689 43,124,428 57,140,319 14,015,891 OPERATING INCOME (53,943,997) 20,931,218 (74,875,215) (17,353,868) (3,851,038) (13,502,830) Non-Operating Income 8,978,188 2,275,795 6,702,394 26,448,322 9,103,178 17,345,144 CHANGE IN NET POSITION ($44,965,808) $23,207,013 ($68,172,821) $9,094,454 $5,252,140 $3,842,314 Quarter Ending June 2025 FY 2024-2025
Revenues – Monthly Trend (13 months)
24 Actual Budget Var Fav/(Unf) Var Fav/(Unf) %
Jun-24 42.6 44.0 (1.4) -3.2%
Jul-24 54.8 50.2 4.7 9.3%
Aug-24 44.9 46.4 (1.5) -3.3%
Sep-24 42.2 44.6 (2.4) -5.3%
Oct-24 36.7 37.2 (0.4) -1.1%
Nov-24 35.2 35.2 (0.0) -0.1%
Dec-24 37.5 39.3 (1.7) -4.4%
Jan-25 38.1 40.1 (2.0) -4.9%
Feb-25 32.9 37.5 (4.6) -12.3%
Mar-25 33.2 33.1 0.2 0.6%
Apr-25 28.2 29.8 (1.6) -5.3%
May-25 28.6 31.8 (3.2) -10.2%
Jun-25 39.2 42.2 (3.0) -7.1%
Revenue Comparison vs. Budget (in millions)
Excludes impact of Rate Stabilization Fund
Cost of Energy – Monthly Trend (13 months)
25 Actual Budget Var Fav/(Unf) Var Fav/(Unf) %
Jun-24 34.3 27.0 (7.3) -27.1%
Jul-24 41.9 44.9 3.0 6.6%
Aug-24 48.5 48.9 0.4 0.9%
Sep-24 39.5 44.7 5.2 11.6%
Oct-24 33.8 34.5 0.7 2.0%
Nov-24 26.3 31.2 4.9 15.8%
Dec-24 4.8 35.0 30.2 86.4%
Jan-25 29.6 41.0 11.4 27.7%
Feb-25 32.9 31.9 (0.9) -3.0%
Mar-25 30.1 33.1 3.0 8.9%
Apr-25 24.0 29.3 5.3 18.2%
May-25 28.9 28.4 (0.5) -1.6%
Jun-25 25.7 26.1 0.4 1.4%
Cost of Energy Comparison vs. Budget (in millions)
Committee Members’ Reports
Peninsula Clean Energy
Adjournment
Peninsula Clean Energy