Peninsula Clean
Energy Executive
Committee
Meeting
November 10, 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 Zoom chats to Brianna Arroyo, Admin Asst. • Action to set the Agenda and Approve Consent items 1-2 • Consent – Public Comment
• Regular Agenda items
• Adjournment
Chair Report
CEO Report
CEO Report
• CAISO Field Trip on 11/13 – Will Reschedule
• Diablo Canyon Field Trip on 12/11 – Still On
• PCE Performance Metrics
CEO Report – Performance Metrics
• Recent negative press in MCE territory presents an opportunity to share some comparative metrics for PCE.
• Not opining on the accuracy of the articles, but an opportunity to reflect on our own Agency’s practices and performance.
• 3 Areas
• Governance and Management Practices
• Financial Health and Rates
• Energy Portfolio and Cost Trends
CEO Report – Governance and Management
• Productive and transparent Board and management relationships - Responsive to Board direction and requests
- Bi-annual Board surveys
• High level of Board communication and engagement
- Board Chair and CEO meet weekly; Board officers kept up-to-date regularly; - Bi-monthly Board newsletter
- Working staff committees and Ad hoc subcommittees
- Rarely have quorum issues
• Fully functioning C-Suite including a seasoned CFO
• Strong finance and risk management committees in place - Audit and Finance Committee, Risk Oversight Committee CEO Report – Financial Health
• Costs generally in line with budget over the last 3 fiscal years • Cost of power and operations have increased over the last two years by an average of ~20%
• No losses; positive change in net position every quarter over the last three years even after deferring $128 M revenue into Rate Stabilization Fund
• Clean audits every year
CEO Report – Customer Rates
• The Board has stated that rate affordability is a priority along with the Agency’s ambitious environmental goals
• PCE electric generation rates have never been higher than PG&E - Historically at 5% discount, last few years at 10%+ discount • Cumulate customer savings of over $210M since 2016
• Cash reserves are high at $422M right now, but will be largely depleted over the next few years to keep rates low as PCIA and power costs increase
Cost of Energy:
Trends, Drivers
and Outlook
Executive Committee Meeting
November 10, 2025
An Evolving Portfolio & An Evolving Market
Topics:
• Cost of Energy (COE) Trends
• Market Prices Influencing COE
• 2024 Power Content Label
Cost of Energy
Performance
Cost of Energy Observed Trends
COE dominates PCE’s
budget; historically
~90% of total operating
expenses
Average per-unit COE in
FY24/25 was ~$98/MWh
Average per-unit COE is
Projected to be
~$88/MWh in FY25/26
*FY24/25 figures based on unaudited financials. FY25/26 figures based on Board-approved budget. $73.59
$86.13
$98.09
$88.15
91%
90%
89%
86%
83%
84%
85%
86%
87%
88%
89%
90%
91%
92%
$0.00
$20.00
$40.00
$60.00
$80.00
$100.00
$120.00
FY22/23 FY23/24 FY24/25 FY25/26
% of Total Operating Expenses
Average Cost ($/MWh)
Cost of Energy: Average Cost and Share of Total Operating Expenses $/MWh % of Total Operating Expenses
Cost of Energy: Actual vs Budget
FY22/23 Very low variance
(0.4%)
FY23/24 Higher actuals primarily
due to elevated resource adequacy
costs
FY24/25 COE was 14.7% below
budget, driven by lower load,
falling market prices for energy &
resource adequacy, and unused
contingency
*FY24/25 figures based on unaudited financials. FY25/26 figures based on Board-approved budget 264
311
429
340
265
325
366
0.4%
4.5%
-14.7%
-20%
-15%
-10%
-5%
0%
5%
10%
$0
$50
$100
$150
$200
$250
$300
$350
$400
$450
$500
FY22/23 FY23/24 FY24/25 FY25/26
Millions
Cost of Energy: Budget vs Actual
Budget ($m) Actual ($m) % Variance
Q1 FY25/26 COE Status
Actual has been very close to
Budget (1.6% variance)
Projected FY25/26 COE to be ~7%
lower than actual COE in FY24/25
• Lower RA prices
• Lower REC/GHG-Free prices
• Increased PPA generation
Market Prices
Influencing COE
Renewable Contract Prices
2010 – first CCA formed 2016 - Peninsula Clean Energy
formed
*Graph from CPUC’s 2024 Padilla Report, May 2024
240
220
200
180
160
140
120
100
80 60
40 20
0 ($/MWh)
No longer true!
Future procurement
costs are now
trending much higher
across the board.
Resource Adequacy (RA) Prices
RA prices were very high in
2024 and 2025 and have since
fallen.
Seasonal fluctuations in RA
prices throughout the year;
prices are highest in
summertime.
PCE will be less exposed to RA
market price volatility as more
contracted projects with RA
value come online.
*Prices from Year-Ahead RA filing in October of the prior year. $-
$20.00
$40.00
$60.00
$80.00
$100.00
$120.00
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
($/kW-mo)
Resource Adequacy Prices, 2022-2026
2022 2023 2024 2025 2026
2023
2025
2022
2026
2024
PCC-1 Renewable Energy Credit (REC) Prices
PCC-1 REC prices peaked in
late 2024 and have fallen
sharply.
2026 prices have come up
slightly, to mid-$20s.
GHG-Free attributes follow a
similar trend but are
generally priced lower than
PCC-1 RECs.
REC and GHG-Free attributes
delivery timing drives
variance between budget &
actuals on a quarterly basis.
$0.00
$10.00
$20.00
$30.00
$40.00
$50.00
$60.00
$70.00
$80.00
$90.00
$100.00
($/MWh)
REC Prices 2022-2025
*Prices for 2025 vintage RECs
Key Factors Influencing COE in Future Years
Upward Pressure:
Political factors – ITC/PTC phasing out, barriers
to renewable development
Supply chain challenges, including new Tariff
AI load growth and lagging resource buildout
Extreme weather events
Expiration of well-priced geothermal and wind
contracts in the 2030's
Lack of resource diversity
Regulatory changes, including new procurement
orders, additional reliability and sustainability
requirements
Project delays
Downward Pressure:
• Solid base portfolio built to meet compliance
• Well-priced new resources coming online
• Risk mitigating procurement practice
• Prepay cost savings
• Potential benefits from regionalization
2024 Power
Content Label
2024 Power Content Label
Board Ad Hoc Committee on
Committees –
Community Advisory
Committee & Community
Feedback Forum (Action)
Donna Colson, Board Chair and
member of Board Ad Hoc Committee
on Committees
Background
• Board Ad Hoc Committee Formed in the Spring:
- Directors Colson, Medina, Mackin, Ragsdale, Taylor
• Formed to review functionality of standing Brown Act Committees and to recommend any changes
• Community Advisory Committee, then Audit & Finance, then Executive Committee
• Review with key question in mind: Given where PCE is now, nearly a decade into operations, are the Committees working in a way that best serves PCE’s needs for the next 10 years?
• Researched best practice governance and community stakeholder committees at other CCAs and public agencies 24
Findings: Community Advisory Committee
• CAC was formed in 2017, and many original members were early supporters and advocates for PCE
• Up to 15 member Brown Act committee meets monthly and is staffed by 2 PCE staff, the General Counsel and others
• CAC scope has expanded over time but primarily focuses on public facing issues. Especially effective in early community outreach, feedback on new programs, DEAI initiative, REACH code advocacy • Brown Act rules for public engagement, small committee size and monthly night meetings limits the opportunity for broader community participation and inclusivity
25 A New Opportunity – Community Feedback Forum
Broaden community stakeholder engagement and feedback by forming a Community Feedback Forum that augments PCE’s new Voice of the Customer Program
Goals:
• Build knowledge of and support for PCE’s climate goals and actions among a wider group of community leaders
• Invite ideas and feedback on PCE’s customer-facing activities from a larger, more diverse group of stakeholders
• Provide community-friendly, flexible, and accessible forums for community listening; multi-lingual, topical breakouts, etc.
26 Community Feedback Forum Proposal
• Invite participation from 50+
community-based organizations and
interested individuals, including
current CAC members
• Convene 4-6 meetings per year to
raise awareness of PCE and collect
feedback on one or more topics or
issues
• Employ flexible, more participatory
meeting formats than otherwise
permitted by the Brown Act
Equitable, Effective Community Stakeholder Engagement
• Employ flexible, interactive meeting formats and best practices
• Hold meetings at different times and locations, such as community centers, libraries, or senior centers
• Leverage small group breakout conversations, including in multiple languages
• Collaborate with community-based organizations
through outreach grants to organize meetings and
recruit participants
Benefits to the Community and PCE
• Unlocks more diverse and deeper feedback from our
customers and various community stakeholders
• Enables more public dialogue and conversation; input is not limited to a 2-minute, formal public comment period • Maximizes reach, impact and benefit to the Agency for staff time invested
October 9th Recommendation from the CAC
The CAC approves the recommendation for a
Community Feedback Forum with the amendment
that the CAC continue in a way that the aggregated
effect is to not increase staff effort and time.
30 Staff Time Estimates
Activity
Estimated
Annual Staff
Time (Hours)
Current CAC – 12
meetings 340
New Community
Feedback Forum – 4
Meetings
100
New Community
Feedback Forum – 6
Meetings
150
• Staffing the CAC is resource-intensive, especially the recruitment process
• This staff time could be
reallocated to reach and listen
to more customers and build
a broader base of support
• Staff can leverage outreach
grants to reach a broad base
of customers for the
Community Feedback Forum
Proposed Next Steps
• November 2025: Board Ad Hoc Committee updates
proposal if needed and makes recommendation(s) to the
Board on November 20.
• December 2025: Pending Board vote, the last CAC
meeting would be held in December. Invite current CAC
members to help shape Community Feedback Forum
meetings and on-going participation in working groups.
• Q1 2026: Launch Community Feedback Forum and
facilitate first meeting.
32 Board Ad-Hoc Committee Recommendation
Sunset the current Community Advisory Committee at
the end of 2025 and thank its members for their
valuable service.
Update and expand the Agency’s approach to
community stakeholder engagement by supporting
recommendation for a new Community Feedback
Forum starting in Q1 2026.
33 Solar Billing Plan
Tariff Update
(Action)
Justin Kudo, Associate Director,
Rates and Strategic Analysis
What is Solar Billing Plan (SBP)?
Solar Billing Plan is the successor to Net Energy Metering • Replaces Net Metering on installs submitted after April 14, 2023 • PCE has 3,328 customers on SBP
• Changed how solar was credited:
• NEM – full retail rate (or close to it), calculated using time-of-use rate • “Running the meter backwards”
• SBP – Energy Export Credit based on wholesale hourly values • “What the energy is worth to the utility”
• Promotes energy storage; over 70% of SBP installs have storage • Compares with 9% of Net Metering installs
35 What are the goals of these changes?
1) Update issues with the existing end-of-year payment process for certain customers with credit balances.
2) Make payments for surplus energy which are fair and justified by available market data and valuations.
3) Make the Solar Billing Plan as easy to understand as possible. 36 How do monthly export credits accrue?
37 $-
$0.05
$0.10
$0.15
$0.20
$0.25
0 2 4 6 8 10 12 14 16 18 20 22
Credit $/kWh
Hour Beginning
Avg. PCE Hourly Export Rates “Exports” occur when energy is sent to the grid by a customer
Export credits are applied against
charges due
Credit rates based on price
forecasts for month,
weekday/end, and hour
Surplus credits are carried forward
and applied to future PCE charges
only and are not eligible for
payment
NSC is what a customer is paid
during an annual true-up
Uses an outdated methodology:
[Net Exports] x [~$0.03/kWh]
Generally, much lower rate than
export credits
How does Net Surplus Compensation (NSC) work?
38 $-
$0.05
$0.10
$0.15
$0.20
$0.25
0 2 4 6 8 10 12 14 16 18 20 22
Rate $/kWh
Hour Beginning
PCE Net Surplus Compensation
Export Credit
Annual True-Up and Customer (“Annie”) Payment
Example
What are the problems here?
1) Annie sees a $125 credit but
only gets paid $40
2) Annie is likely to continue
accruing credits each year
unless they add additional
load; PCE will also carry these
liabilities
3) Annie keeps both credits, so
they’re getting an additive
credit for the same energy
39 Annie’s True-Up Current Proposed
Accrued Export
Credit Balance
$150 $150
New Monthly Bill $25 $25
Remaining Export
Credit Balance
$125 $125
Carried Forward
into Next Year
$125 $0
Payment Current Proposed
Methodology Net kWh x $0.04 Credit Balance
Payment to
Customer
$40 $125
How does this compare with PG&E?
PG&E’s program addresses the additive credit issue by reversing the initial credit (at a proxy rate), before paying NSC
• This means customers get a charge of $0.08/kWh (!) alongside their $0.03/kWh NSC payments, raising concerns about the program design
• PCE’s program would continue to not have this credit deduction • Staff hopes that PCE’s example can provide a better, data-driven path for paying customers for surplus energy
40 Recommendation
Recommend to the Board of Directors approval of the revised Solar Billing Plan tariff, effective January 1, 2026.
41 Questions?
42 Committee Members’ Reports
Adjournment