Valley Clean Energy Board Meeting – April 13, 2023
Item 12 – Amended & Restated PPA with Gibson Renewables LLC 1 yvonnehunterphotography.com
Public Comments
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Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] • Nov 2020, the Board approved two PPAs resulting from the local RFO: 1) Putah Creek Energy Farm (went into commercial operation in Oct 2022), and 2) Gibson Renewables, LLC (Gibson) - the Gibson Solar project
• Upon receiving and reviewing the interconnection System Impact Study (SIS), Gibson notified VCE that the project would need to be downsized to achieve a cost and utility construction timeline that would be viable
• In Nov 2022, Gibson provided an updated project proposal based on the new configuration to VCE. Based on this information, VCE and Gibson agreed to suspend certain terms of the PPA, while attempting to renegotiate the PPA
• The revised project continues to support several Goals/Objectives of VCE’s Strategic Plan, specifically Objectives 2.1 2.2 and 2.31
• The revised project size nearly satisfies VCE’s obligation of the Diablo Canyon replacement category of the CPUC’s mid-term reliability (MTR) procurement mandate2 3 Item 12 – Amended & Restated PPA w/ Gibson Renewables LLC:
Background
1) VCE’s strategic plan adopted by the Board on 10/8/2020 2) 6/24/21, the California Public Utilities Commission (CPUC) adopted D.21-06-035 requires a resource to be zero-emitting and be available from 5-10pm
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] • Counterparty: Gibson Renewables LLC
• 13 MW AC of Solar PV Bifacial modules on Trackers, 13 MW/5-hour of BESS storage (65 MWh)1,2
• Multi-Use Plan
• Pollinator friendly
• Major Use Permit through Yolo County Planning. Anticipated project consideration dates:
• Esparto Citizen’s Advisory Committee (CAC) Recommendation – Q2 2023 • Yolo County Planning Commission Hearing – Q3 2023
• Yolo County Board of Supervisors – Q3 2023
4 Item 12 – Amended & Restated PPA w/ Gibson Renewables LLC:
Overview
1) PV field is approximately 25 MWdc, which is 20 MWac. The limiting factor is the 13 MWac point of interconnection
2) BESS = Battery Energy Storage System
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] 5 Item 12 – Amended & Restated PPA w/ Gibson Renewables LLC: Site Details
• Net Parcel Acreage: ±147 acres
• Address: State Hwy 16, Esparto, CA
• Zoning: A-N (Agricultural Intensive)
• POI: Existing PG&E 21kV Distribution Line
Site Details
• 147 Acres impacted
• 20MW AC Solar
• 6.5MW/4-hour ESS
Original Configuration
• <100 acres impacted
• 13MW AC Solar
• 13MW/5-hour BESS
Revised Configuration
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] 6 Item 12 – Amended & Restated PPA w/ Gibson Renewables LLC: Multi-Use Plan Features • Serve as pollinator habitat
• Reduce water demand
Native vegetation substrate
• Supports local and regional
agricultural production
Apiaries
• Natural vegetation control vs
chemical or mechanical means
Sheep Grazing
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] 7 Item 12 – Amended & Restated PPA w/ Gibson Renewables LLC:
Partnerships & Labor Agreements
UCD Research
Gibson Renewables has partnered
with UC Davis Wild Research
Center to curate the seed mix for
the project and conduct research
on how co-locating solar PV and
apiary can positively impact local
agriculture.
• Memorandum of Understanding
and Gift Agreement with UCD
executed
Union Project Labor Agreement (PLA)
Gibson Renewables has executed a
project labor agreement with:
• Operating Engineers Local 3
• Northern California Carpenters
Regional Council on behalf of itself its
affiliated local unions
• Northern California District Council of
Laborers and its affiliated local unions
• IBEW Local 340, and
• Ironworkers Local 118
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] 8 Item 12 – Amended & Restated PPA w/ Gibson Renewables LLC: Status of Development
Gibson Solar
Land Use Permit
Process:
• Public meeting with Esparto/Madison advisory
committees
• Public hearings – Planning Commission (PC) & Board of Supervisors (BOS)
Land Use Permit Type: Major Use Permit with Focused EIR Est. Approvals: Anticipated Q3 2023
Completed Studies:
• Cultural Resources Assessment
• Biological Resources Assessment
• Preliminary Drainage Assessment
Interconnection:
• PG&E Fully executed interconnection agreement
• CAISO Full Capacity Deliverability Study (FCDS)
Allocation anticipated Q4 2023
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] • In November 2020, ReneSola Power Holdings, LLC acquired selected assets via ET Cap CA Holdings LLC, which included the Gibson Renewables, LLC • In October 2022, ReneSola announced the acquisition of Emeren Limited, a United Kingdom-based utility-scale solar power and battery projects developer in Europe
• January 2023, ReneSola Power announced that it had changed its corporate name to Emeren Group Ltd ("Emeren")1,2,3
9 Item 12 – Amended & Restated PPA w/ Gibson Renewables LLC:
Counterparty
1) Located in Pleasanton, CA, Emeren US, LLC is a publicly traded (NYSE: SOL) 2) 300 MW project development, project finance, and asset sales in CA, NC, MA, OR, MN etc 3) 500 MW+ project pipeline under development
Gibson
Renewables, LLC
ET Cap CA
Holdings, LLC Emeren US, LLC
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] • In March 2023, VCE submitted a grant application to the California Department of Food and Agriculture (CDFA) for $5.7M to enable the Gibson project to have the capability to operate in a microgrid state
• The grant opportunity is part of the CDFA’s Community Resilience Centers Program. The project would utilize the proposed Gibson project as well as additional electrical infrastructure (grant funds would support this additional infrastructure) to serve the Capay valley in times of electrical outages
• The overall project would be called the Esparto Capay Multi-Customer Microgrid project. • The grant application received support from Senator Dodd, Assembly Member Aguiar-Curry, The Climate Center and PG&E • The project will serve the Capay valley via PG&Es Madison circuit 2101 • 5 community resilience centers (CRCs) are served by this circuit and the Gibson project could serve these centers during a power outage
10 Item 12 – Amended & Restated PPA w/ Gibson Renewables LLC: CDFA Grant Opportunity
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] 11 Item 12 – Amended & Restated PPA w/ Gibson Renewables LLC: CDFA Grant Opportunity – Capay Valley Benefits
• Capay valley is surrounded by a Tier 2 High Fire Threat Zone • Each CRC has a corresponding evacuation zone associated as defined by the Yolo County Office of Emergency Services Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] Conclusion:
• The initial Gibson project was higher cost and delayed due to interconnection issues outside of the developer’s control • The re-sized project is cost-competitive, utilizes less land, supports VCE’s strategic plan, meets regulatory mandates and has potential microgrid capability
Recommendation:
• Approve resolution authorizing the Executive Officer to execute an amended power purchase agreement (PPA) and any necessary ancillary documents for the Gibson renewable photovoltaic (PV) plus battery storage (BESS) project
12 Item 12 – Amended & Restated PPA w/ Gibson Renewables LLC:
Conclusion & Recommendation
Valley Clean Energy Board Meeting – April 13, 2023
Item 13 – Calendar Year 2022 Audit Report 13
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Public Comments
14 To Provide Public Comment on any agenda item please:
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Presented by
James Marta CPA, CGMA, ARPM
VALLEY CLEAN ENERGY ALLIANCE
SUMMARY OF AUDIT RESULTS
DECEMBER 31, 2022
James Marta & Company LLP
Agenda • Communications with Those Charged with Governance • December 31, 2022, Valley Clean Energy Alliance (VCE) Financial Information and Auditor’s Report
16 COMMUNICATION WITH
THOSE CHARGED WITH GOVERNANCE
17 James Marta & Company LLP
Professional
standards require
that we provide
you with
information related
to our audit of
VCE. This
information is
summarized as
follows:
• Responsibilities and Opinion
• Financial statements are the
responsibility of management
• Our responsibility is to express
an audit opinion
• We issued an unmodified
opinion (the best and auditor
can give)
18 James Marta & Company LLP
REPORT TO YOU - INTERACTIONS WITH MANAGEMENT
Management Consultations
with Other Independent
Accountants:
✓ None
Disagreements with
Management of Difficulties
Encountered:
✓ None
Management
Representations:
✓ Received
James Marta & Company LLP
REPORT TO YOU
QUALITATIVE
ASPECTS OF
ACCOUNTING
PRACTICES
• Significant Accounting Policies and
Changes in Those Policies - No changes
• Management Judgments and
Accounting Estimates
• Receivables, Allowance for Doubtful
Accounts
• Appropriate and in-line with
standards
20 James Marta & Company LLP
AUDIT
PROCEDURES
• An Audit is more than just assurance regarding the fairness of presenting financial statements. An Audit involves gaining an understanding of the organization’s systems and controls.
- Understanding; systems, policies and procedures
- Tests of control
- Gathering other audit evidence, review of details, performing test calculations. - Review of accounting methods and reporting
21 James Marta & Company LLP
RESULTS OF
THE AUDIT
22 Consideration Area Result
Planned Scope and Timing Scope and timing as anticipated Findings Identified in
Performing the Audit None
Significant Adjustments or Disclosures Not
Reflected in the Financial Statements None
FINANCIAL STATEMENTS
WITH INDEPENDENT AUDITOR'S REPORT
23 James Marta & Company LLP
INDEPENDENT
AUDITOR'S
REPORT
• Pages 1-3 of the Audited Financial
Statements
• Unmodified opinion (Page 1),
the best opinion that we can provide
24 James Marta & Company LLP
MANAGEMENT’S
DISCUSSION &
ANALYSIS
(MD&A)
• Pages 4-7
• Financial Highlights
• Condensed financial statements and graphs plus narrative about why balances changed from prior years
• Analysis of balances and transactions
• Facts or conditions that are expected to have a significant effect 25 James Marta & Company LLP
STATEMENT OF
NET POSITION
26 Assets up $5.7M
(Mainly increase in
receivables)
Liabilities down $4k
Net position is
up $5.7M
$24,134,563
$8,724,029
$15,410,534
$18,414,672
$8,728,436
$9,686,236
$-
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
Total Assets Total Liabilities Net Position
Statement of Net Position
2022 2021
James Marta & Company LLP
STATEMENT OF
NET POSITION
27 2022 2021
ASSETS
Current assets
Unrestricted Cash $ 3,850,610 $ 3,671,384
Accounts receivable, net of allowance 11,085,087 7,406,469 Accrued revenue 3,430,397 1,768,193
Prepaid expenses - 9,192
Other current assets and deposits 1,806,883 1,998,276
Total Current Assets 20,172,977 14,853,514
Restricted assets:
Cash in - debt service reserve fund 1,100,000 1,100,000 Cash in - power purchase reserve fund 2,709,273 2,461,158 Total Restricted assets 3,809,273 3,561,158
Noncurrent Assets
Other noncurrent assets and deposits 152,313 -
Total Noncurrent Assets 152,313 -
TOTAL ASSETS $ 24,134,563 $ 18,414,672
LIABILITIES
Current Liabilities
Accounts payable $ 399,529 $ 445,042
Accrued cost of electricity 4,657,891 4,580,941
Accrued payroll 116,285 63,909
Interest payable 2,248 2,786
Due to member agencies 25,160 117,945
Other accrued liabilities 2,810,664 2,364,787
Line of credit 530,968 1,153,026
Total Current Liabilities 8,542,745 8,728,436
Noncurrent Liabilities
Line of credit 181,284 -
Total Noncurrent Liabilities 181,284 -
TOTAL LIABILITIES 8,724,029 8,728,436
NET POSITION
Net position
Designated - local program reserves 224,500 224,500
Restricted 3,809,273 3,561,158
Unrestricted 11,376,761 5,900,578
TOTAL NET POSITION $ 15,410,534 $ 9,686,236
Accounts receivable
and accrued revenue up
due to increase rates
and collectability
James Marta & Company LLP
STATEMENT OF
REVENUES,
EXPENSES,
AND CHANGES
IN NET
POSITION
28 Primary drivers: • Twelve Months vs
Six Months
• Electricity sales and
costs
• Conscious pricing
decisions
James Marta & Company LLP
STATEMENT OF
REVENUES,
EXPENSES,
AND CHANGES
IN NET
POSITION
29 2022
(Twelve Months)
2021
(Six Months)
OPERATING REVENUE
Electricity sales, net $ 85,322,760 $ 29,357,623
Other revenue 1,338,974 -
TOTAL OPERATING REVENUES 86,661,734 29,357,623
OPERATING EXPENSES
Cost of electricity 75,130,283 30,138,826
Contractors 2,556,894 1,383,829
Staff compensation 1,282,519 537,689
Program expenses 1,168,019 -
General and administrative 759,754 341,143
TOTAL OPERATING EXPENSES 80,897,469 32,401,487
TOTAL OPERATING INCOME (LOSS) 5,764,265 (3,043,864)
NONOPERATING REVENUES (EXPENSES)
Interest income 46,501 8,731
Interest and related expenses (86,468) (22,545)
TOTAL NONOPERATING REVENUES (EXPENSES) (39,967) (13,814) CHANGE IN NET POSITION 5,724,298 (3,057,678)
Net position at beginning of period 9,686,236 12,743,914 Net position at end of period $ 15,410,534 $ 9,686,236 • Twelve Months vs Six Months
• Other revenue is
largely the AgFit
program.
James Marta & Company LLP
STATE MENT OF
CASH FLOWS
30 James Marta & Company LLP
STATEMENT OF
CASH FLOWS
31 2022
(Twelve Months)
2021
(Six Months)
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from electricity sales $ 79,912,041 $ 31,149,236 Payments for security deposits with energy suppliers (152,313) - Payments to purchase electricity (74,983,435) (32,255,458) Payments for contract services, program expenses, general, and administration (4,167,896) (2,276,073) Payments for staff compensation (1,230,143) (517,485)
Other cash payments 1,530,367 (11,393)
Net Cash Provided (Used) by Operating Activities 908,621 (3,911,173)
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES
Principal payments of debt (440,774) (197,661)
Interest and related expense (87,007) (23,019)
Net Cash Provided (Used) by Non-Capital Financing Activities (527,781) (220,680)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest income 46,501 8,731
Net Cash Provided (Used) by Investing Activities 46,501 8,731 NET CHANGE IN CASH AND CASH EQUIVALENTS 427,341 (4,123,122) Cash and cash equivalents at beginning of period 7,232,542 11,355,664 Cash and cash equivalents at ending of period $ 7,659,883 $ 7,232,542 Operating income (loss) $ 5,764,265 $ (3,043,864)
(Increase) decrease in net accounts receivable (3,678,618) 576,071 (Increase) decrease in net accrued revenue (1,662,204) 1,167,098 (Increase) decrease in prepaid expense 9,192 5,951
(Increase) decrease in other assets and deposits 39,080 (11,393) Increase (decrease) in accounts payable (45,513) 45,276 Increase (decrease) in accrued payroll 52,376 20,204
Increase (decrease) in due to member agencies (92,785) (5,461) Increase (decrease) in accrued cost of electricity 146,848 (2,116,632) Increase (decrease) in other accrued liabilities 445,877 (596,867) Increase (decrease) in user taxes and energy surcharges (69,897) 48,444 Net Cash Provided by Operating Activities $ 908,621 $ (3,911,173)
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED (USED) BY OPERATING ACTIVITIES
Adjustments to reconcile operating income to net cash provided (used) by operating activities:
James Marta & Company LLP
INDEPENDENT
AUDITOR’S
REPORT
ON INTERNAL
CONTROL AND
COMPLIANCE
• No Material Weaknesses identified
• No instances of noncompliance
identified
32 James Marta & Company LLP
Thank you to
Valley Clean Energy Alliance staff
for the partnership
in completing this engagement.
33 Valley Clean Energy Board Meeting – April 13, 2023
Item 14 – Treasury and Finance update 34
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Public Comments
35 To Provide Public Comment on any agenda item please:
➢ E-mail 300 words or less to: [email protected] OR
If in person, complete a COMMENT CARD
OR
Join the Public Comment Queue by
➢ “Raising Hand” on Zoom Meeting
OR
➢ Press *9 if joining by phone
Emailed comments received before the item has concluded will be read into the record.
Emailed comments received after the item has concluded but before the end of the meeting will not be read but will be included in the meeting record.
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] 36 Item 14 – Treasury and Finance Update
VCE Treasurer
• VCE at formation selected County Chief Financial Officer as the VCE Treasurer in JPA agreement (could be revisited should VCE desire to do so). • Treasurer role focuses in three areas:
• Banking & Cash Management – Day to day transactions are done by VCE staff.
Treasurer participates in selection of banking institutions and collaborates with staff on Cash Flow management.
• Investing – Responsible for the investment of funds in accordance with law and investment policy.
• Financing – Participates as a key member along with VCE staff on financing decisions and development debt policies.
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] 37 Item 14 – Treasury and Finance Update
VCE Investment Policy
• VCE investment ability is presently restricted by Revolving Loan of Credit Agreements with River City Bank (excerpts below):
• “Borrower shall maintain all of borrower’s deposit accounts exclusively with the lender.”
• “Borrower shall not directly or indirectly, make, retain or have any investments …” • In effect, VCE currently only has products offered by RCB open to it. Thus, VCE has opened a Money Market Account with RCB (presently 1.250% annual interest rate). • Treasurer will schedule regular check-ins with VCE Director of Finance and Internal Ops to review cash flow and will revisit investment options in the future.
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] 38 Item 14 – Treasury and Finance Update
Banking Environment and Risk Assessment
• 2023 Banking Crisis – Silvergate Bank, Silicon Valley Bank, and Signature Bank • Concentration Risk - Technology sector or cryptocurrency • Balance Sheet Risk - Federal Reserve rapidly raising interest rates • Federal Reserve Response
• Federal Deposit Insurance Corporation & United States Department of the Treasury – • All deposits were honored
• VCE Risk Assessment
• VCE funds are limited to permitted investments
• funds on deposit are required to be collateralized
• Balances are monitored - California Department of Financial Protection and Innovation Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] 39 Item 14 – Treasury and Finance Update
Tasks 2023 2024
A M J J A S O N D J F M A M J
Review of Rating
Agencies
VCE Policy Review
Reserve Policy
Rates Policy
Debt Policy
Draft VCE Rating
Presentation
Rating Agency Process
2023 Audited Financials
Initial Investment Grade Credit Rating - Timeline
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] 40 Item 14 – Treasury and Finance Update
Requested Actions:
Ratify County of Yolo Investment Policy as applicable Investment Policy to VCEA for calendar year 2023.
Valley Clean Energy Board Meeting – April 13, 2023
Item 15 – Inflation Reduction Act (IRA) 41
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Public Comments
42 To Provide Public Comment on any agenda item please:
➢ E-mail 300 words or less to: [email protected] OR
If in person, complete a COMMENT CARD
OR
Join the Public Comment Queue by
➢ “Raising Hand” on Zoom Meeting
OR
➢ Press *9 if joining by phone
Emailed comments received before the item has concluded will be read into the record.
Emailed comments received after the item has concluded but before the end of the meeting will not be read but will be included in the meeting record.
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
OVERVIEW AND ITEMS OF INTEREST TO VCE
CUSTOMERS
• Signed into law in August 2022
• Total of $739 billion
• About $300 billion for energy security and climate change programs over ten years
• Also includes prescription drug pricing reform, Medicare changes, as well as other non-energy/climate provisions 43 Item 15 – Inflation Reduction Act (IRA)
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)] PARTIAL LIST OF IRA FUNDED CLIMATE/ENERGY PROGRAMS • $1 billion for improving energy efficiency, water efficiency, or climate resilience of affordable housing.
• $1 billion to update to the latest building energy code and zero energy/stretch codes. • $3 billion for loans to build new clean vehicle manufacturing facilities and $2 billion in grants to retool existing auto manufacturing facilities to manufacture clean vehicles. • $3 billion for Environmental and Climate Justice Block Grants for community-led projects in disadvantaged communities and community capacity-building centers to address the disproportionate environmental and public health harms caused by pollution and climate change.
• $5 billion in grants to support healthy, fire resilient forests, forest conservation, and urban tree planting.
• $4 billion for drought mitigation.
• $1.8 billion for hazardous fuels reduction projects on National Forest System land within the wildland-urban interface.
• $27 billion for a Greenhouse Gas Reduction Fund to support the rapid deployment of low- and zero-emission technologies, with 40 % allocated for low-income and disadvantaged communities.
44 Item 15 – Inflation Reduction Act (IRA)
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
• FEDERAL TAX CREDITS AVAILABLE NOW FOR
HOMEOWNERS AND BUSINESSES
• Tax credits for various energy efficiency projects and clean energy projects
• Significant changes for non-profits and local governments related to tax credits
• STATE REBATES COMING SOON WITH IRA FUNDING FOR
ENERGY EFFICIENCY PROJECTS
45 Item 15 – Inflation Reduction Act (IRA)
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
FEDERAL TAX CREDIT
Electric Vehicles – Passenger Vehicles
• Extends existing $7500 tax credit but adds criteria to qualify • Vehicles must be assembled in North America and contain certain material content
• Includes hybrids
• Adds EV charging stations to eligibility
46 Item 15 – Inflation Reduction Act (IRA)
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
Electric Vehicles – Commercial Vehicle Tax Credits
Commercial EV Tax Credits do NOT include the same limiting criteria as those for passenger vehicles; vehicle must be used for business purposes
Amount of Tax Credit
• Lesser of 30 percent of the sales price or the incremental cost of the vehicle
oUp to $7,500 for vehicles weighing less than 14,000 pounds oUp to $40,000 for vehicles weighing more than 14,000
pounds
47 Item 15 – Inflation Reduction Act (IRA)
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
Tax Credits for Commercial Electric Vehicle
Charging Infrastructure
• 30 percent up to $100,000 per charger
48 Item 15 – Inflation Reduction Act (IRA)
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
RESIDENTIAL ROOF TOP SOLAR
• 30% of cost to purchase and install (increased from 26%) for ten years
• Decreases to 26% in 2033 and 22% in 2034
• Adds battery storage paired to panels to eligibility
49 Item 15 – Inflation Reduction Act (IRA)
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
50 Item 15 – Inflation Reduction Act (IRA)
HOME ENERGY EFFICIENCY TAX CREDITS
• Heat Pumps
• Home energy efficiency improvements
➢ Covers qualified windows, doors, HVAC systems, water
heaters and other energy efficiency
equipment that meet specified criteria
➢ Begins in 2023; continues through 2033
➢ Anticipates rebates distributed through
states beginning in 2023
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
51 Item 15 – Inflation Reduction Act (IRA)
OTHER TAX CREDITS CHANGED BY THE IRA
• Investment Tax Credit extension for certain types of
projects
• Production Tax Credit for eligible
projects
• Production Tax Credit for Electricity Produced from
Renewables (such as solar arrays)
• Special tax credits for renewable energy generation projects located in low-income communities and tribes
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
52 Item 15 – Inflation Reduction Act (IRA)
COMING SOON – ENERGY EFFICIENCY REBATES
• Funds for energy efficiency and other rebates sent to States for distribution
• California Energy Commission and CPUC two lead agencies • Funds for existing and new programs
• Tentative timeline:
• DOE engaged in “listening” sessions
• Funds expected to reach states’ “Energy Office” in Spring 2023 • Other IRA funds may go to other state agencies
• State agencies distribute funds through existing and new programs – not sure yet when available
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
53 Item 15 – Inflation Reduction Act (IRA)
BIG CHANGES FOR TAX-EXEMPT ENTITIES
Before the IRA, local governments and other tax-exempt
entities could not take advantage of Federal tax credits because they do not pay taxes.
• Tax-exempt entities now can receive tax credit benefits with a direct payment option in lieu of tax credits for certain projects.
• Purchase of EVs and charging infrastructure (same as for commercial EVs
• Renewable Energy Production Tax Credits
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
54 Item 15 – Inflation Reduction Act (IRA)
NEW TAX CREDIT OPPORTUNITIES FOR VCE
MEMBER LOCAL GOVERNMENTS
• Consult with your finance director and bond counsel
• Check out links on Resources to Learn More slide
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
55 Item 15 – Inflation Reduction Act (IRA)
Source: National Association of Counties
Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
56 Item 15 – Inflation Reduction Act (IRA)
PLANNED VCE ACTIVITIES
• Update website with EV and home energy
efficiency tax credit information
• Update website with rebate information as it becomes
available
• Reach out to member agencies with information about what is applicable to them (i.e., Commercial EVs and direct
payment option in lieu of tax credits, rebates)
• Consider applying for IRA-related funding or using tax-exempt opportunities for new renewable energy projects Item X – Short Title and Slide Description [Calibri (Body) 29 font (not bold)]
57 Item 15 – Inflation Reduction Act (IRA)
RESOURCES TO LEARN MORE
• WHITE HOUSE IRA PORTAL
https://www.whitehouse.gov/cleanenergy/
• WHITE HOUSE GUIDEBOOK ABOUT IRA
https://www.whitehouse.gov/cleanenergy/inflation-reduction-act-guidebook/ • IRS FAQS ABOUT IRA RESIDENTIAL TAX CREDITS
https://www.irs.gov/pub/taxpros/fs-2022-40.pdf
• IRS FACT SHEET ABOUT IRA TAX CREDITS
https://home.treasury.gov/system/files/136/Fact-Sheet-IRA-Equitable-Clean-Energy-Economy.pdf • NATIONAL LEAGUE OF CITIES ARTICLE ABOUT TAX CREDITS FOR LOCAL GOVERNMENTS https://www.nlc.org/article/2022/09/23/inflation-reduction-act-clean-energy-project-eligibility-for-local-governments/ • NATIONAL ASSOCIATION OF COUNTIES ARTICLE ABOUT THE IRA https://www.naco.org/resources/legislative-analysis-counties-inflation-reduction-act • ENERGY STAR INFORMATION ON IRA FOR HOMEOWNERS, BUILDERS, COMMERCIAL BUILDINGS https://www.energystar.gov/about/federal_tax_credits