Finance & Risk
Management
Committee
Meeting
March 3, 2022
2 Regular
Meeting
Agenda
1. Welcome
2. Roll Call
3. Public Comment for Items Not on the Agenda
4. Items to be Added, Withdrawn or Reordered on
the Agenda
Regular Agenda
5. Treasurer’s Report for Period Ending 1/31/22
6. Proposed Renewal and Increase to River City
Bank Credit Facility
7. Energy Proposal Evaluation Criteria
Committee Member Announcements
Adjournment
3 Item 5
Treasurer’s Report for Period Ended 1/31/22
Presenter:
Dr. Eric Washington,
Chief Financial Officer
4 Results for the period were in line compared
to the amended budget:
• Net operating revenues were slightly 1%
under the budgeted amount
• Operating expenses were inline with the
budget
Financial results for the YTD FY22:
• $208.11M in net operating revenues
• $199.76M in total expenses
(includes energy costs of $196.09M
or 94% of net revenues)
• $8.36M change in net position
Budget Comparison
YTD FY22 as of
1/31/22 (7 mos)
FY22 YTD
Budget
Budget
Variance ($) Budget (%)
Net Operating Revenues $ 208,112,088 $ 209,341,518 $ (1,229,430) 99 Total Expenses $ 199,756,193 $ 199,544,706 $ 211,487 100 Change in Net Position $ 8,355,895 $ 9,796,812 $ (1,440,917) Item 5: Treasurer’s Report
YTD FY22 Budget v. Actual
5 Item 5: Treasurer’s Report
Year-to-date financial results compared
to projections:
• Net operating revenues were inline
with projections
• Total expenses were $1.55M more
than projected
• Change in net position was $2.27M
under the projected
YTD FY22 Proforma v. Actual
6 Item 6
Proposed Renewal and Increase to River City
Bank Credit Facility
Presenter:
Dr. Eric Washington,
Chief Financial Officer
7 Item 6: Proposed Renewal and Increase
to River City Bank Credit Facility
Prior Loan Amount
$35.0m
New Loan Amount
$50.0m
Loan Type • Commercial Revolving Line of Credit (“RLOC”) Purpose • To support working capital as needed
• To support the issuance Letters of Credit
Interest Rate
RLOC: ~2.63% as of 2/25/22
Term Loan: 5-year US
Treasury Note yield + 2.00%
• RLOC: Floating at the 3-month term Secured Overnight Financing Rate (“SOFR”) as published by CME Group plus 2.25%. Subject to a 2.25% floor rate • Term Loan: Fixed for the Term Loan term at the then prevailing 5-year US Treasury Note yield + 2.00% on the Term Loan Conversion Date, subject to a
2.00% interest rate floor. (No change)
Repayment
• RLOC: Interest only due monthly, outstanding principal due at maturity or termed out under the term loan provision
• Term Loan: Fully amortized over 60 months with equal monthly principal and interest payments
• LCs: In the event of a Letter of Credit draw, bank will disperse funds from the RLOC, and borrower must repay the Bank in full within 3 days. 8 Item 7
Energy Proposal Evaluation Criteria
Presenter:
Byron Vosburg,
Director of Power Services
9 Proposed Evaluation Criteria
Project
Development
Environmental
Stewardship
Workforce
Development
Community
Benefits
Project
Location
Quantitative
Value
• SDCP will use an Energy Proposal Evaluation Criteria (EPEC) to score proposals for evaluation of long-term, wholesale energy contracts and, generally, to guide all resource procurement • The EPEC may be modified on a solicitation-by-solicitation basis to reflect specific goals of targeted procurement
• The EPEC will include evaluation within the following six areas:
10 Project Location
Local
• For Renewable Energy: San Diego or Imperial counties
• For Energy Storage: SD-IV Local RA
• In Southern California
• Out-of-state projects
HIGH
MEDIUM
LOW
NEUTRAL • In other counties within California
11 Quantitative Value
Projects will be ranked and categorized as
high, medium, or low.
• The Quantitative score will be based
on several project development- related factors, including: – Contract price – Products offered/included for purchase
– Value to SDCP customers – Impact to SDCP portfolio risk 12 Project
Development
Projects will be ranked and categorized as
high, medium, or low.
• The development score will be based
on several project development-related factors, including:
– Site control
– Interconnection status
– Environmental screens
– Land use and permits
– Project financing
– Developer experience
13 Community Benefits
• Located within a DAC, has completed community outreach, and demonstrates community benefits
• If non-DAC, project demonstrates extraordinary community benefits • Project is not located within a DAC but has completed community outreach and can demonstrate community benefits
• Project does not demonstrate community benefits
• Project is inconsistent with community priorities
HIGH
MEDIUM
NEUTRAL
LOW
14 Workforce
Development
• The project meets all objectives of SDCP’s Inclusive and Sustainable Workforce Policy with respect to PPAs.
• The project does not meet all objectives of SDCP’s ISWF Policy but can demonstrate prevailing wage, skilled and trained workforce, and local hire commitments • The project does not demonstrate prevailing wage, skilled and trained workforce, and local hire commitments
HIGH
MEDIUM
LOW
15 SDCP ISWF Policy
16 Environmental Stewardship
HIGH
MEDIUM
NEUTRAL
LOW
• Demonstrates multiple societal, health, economic, water-saving, or environmental benefits beyond the climate and GHG reduction benefits of renewable energy
• Located in area designated as a preferred renewable energy zone and has received required land use entitlement permits
• Project does not demonstrate positive or negative environmental impact • Project demonstrates significant, unmitigated negative environmental impacts 17 Example Evaluation
Project Summary Location Price Capacity
(MW)
COD Project
Location
Price /
Value
Dev
Score
Community
Benefits
Workforce
Dev
Enviro
SDCP A SD
County
$2 100 1/1/24 High High High Med High Med
SDCP B Orange
County
$1.50 200 1/1/24 Med High High High High Neutral
SDCP C SD
County
$2.25 50 1/1/25 High High Med Neutral High Neutral
SDCP D Imperial
County
$2 20 1/1/24 High High High Neutral High Neutral
SDCP E SD
County
$3 75 1/1/25 High Med Med Neutral Med Neutral
SDCP F Riverside
County
$3.50 20 1/1/25 Med Med High Med Med Neutral
SDCP G Imperial
County
$4 50 1/1/24 High Low Med Low TBD Neutral
SDCP H SD
County
$3.75 100 1/1/24 High Low High Neutral Med Low
Finance & Risk
Management
Committee
Next Regular Meeting
April 7, 2022