Fremont City Council Meeting: 04/07/26 07:00 PM
3300 Capitol Avenue Div/Dept: Public Works
Fremont, CA 94538 Category: Agreements and Contracts
SCHEDULED
Sponsors:
COUNCIL STAFF REPORT (ID # 5666) DOC ID: 5666
Updated: 4/3/2026 9:26 AM by Dina Lewis Page 1
LS POWER FRANCHISE - Public Hearing and Introduction of an Ordinance Granting an Electric Franchise to LS Power Grid California, LLC; Adopt Resolution Adopting the Power the South Bay project Environmental Impact Report and Make Findings; Authorize the City Manager to Take Steps to Effectuate the Franchise; and Direct the City Clerk to Publish a Summary of the Ordinance
Contact Persons:
Name: Ian Champeny Hans Larsen
Title: Real Property Agent Public Works Director
Div/Dept: Public Works Public Works
Phone: 510-494-4759 510-494-4722
E-Mail: [email protected] [email protected]
Executive Summar y: The purpose of this report is to facilitate approval of a franchise agreement with LS Power Grid California, LLC (“LS Power”) to support enhancing the electrical power supply serving Fremont and the greater Bay Area.
BACKGROUND: Over the last year, the City of Fremont has been working with LS Power regarding its Power the South Bay Project to install a new 230 kilovolt (kV) alternating current (AC) transmission line through Fremont for 12 miles (6 miles within Fremont) between existing substations in Santa Clara (near Levi’s Stadium) and in Fremont (on Boyce Road near Auto Mall Parkway).
The purpose of the franchise is to permit LS Power to install, construct, maintain and use under, along, across or upon the public streets, and rights -of-way within the City, pipes and appurtenances for transmitting and distributing electricity. The proposed electrical transmission line is planned to be underground in the south Fremont area and within segments of Fremont Boulevard, Cushing Parkway and Boyce Road.
This project will strengthen the electrical grid by providing robust connections and providing better access to cost -effective energy for residents and businesses. Construction is projected to begin in 2026 and conclude in 2028.
DISCUSSION/ANALYSIS: Electric transmission line upgrades are essential for ensuring reliable and sufficient electricity supply for Fremont and the greater Bay Area. With new technologies being developed, the current infrastructure requires increased capacity to meet demand.
LS Power will pay the City an annual fee in the range of 2.0% - 2.3% of the Fremont portion of its gross revenue on an annual basis. The franchise also requires LS Power to provide a performance security bond in the amount of $200,000, updates in insurance requirements, indemnification, liability, and reimbursement of City actual and administrative costs incurred in processing and administering the franchise, permits, and inspections . LS Power will also install two spare 2 -inch nominal diameter subsurface conduits along the Project’s transmission line route for the City’s use, as shown in the Public Benefits attachment Council Staff Report (ID # 5666) Meeting of April 7, 2026 Updated: 4/3/2026 9:26 AM by Dina Lewis Page 2
included with the staff report. In addition, the project should generate significant property and sales tax revenue for the general fund, as well as lease revenue, which has contributed toward the City’s new Central Park Community Center project.
The term of the franchise is recommended to be 10 years with automatic renewals for successive 10-year terms up to 40 years. This enables the City to meet and discuss shared interests and engage and secure partnership agreements to accomplish shared goals such as climate action, resiliency, and other programs.
On March 10, 2026, the City Council adopted a resolution of intent to grant the franchise and set the public hearing for April 7, 2026. Notice of the public hearing was published in the Tri-City Voice on March 17, 2026 (within fifteen days of the resolution of intent ), the public hearing is being held between 20 and 60 days after the passage of the resolution , and all notice and time requirements have been met . The proposed Franchise Ordinance is attached to this report.
FISCAL IMPACT: LS Power will pay an annual franchise fee in the range of 2.0% - 2.3% of the Fremont portion of its gross revenue for the use of the public right of way to convey electrical transmission lines, with the first year of franchise payment expected to be approximately $500,000 to $750,000. Parties will settle on the highest total percentage that meets federal and state regulations without undue burden to maintain LS Power compliance as a transmission-only utility.
ENVIRONMENTAL REVIEW: The California Public Utilities Commission (CPUC) is the lead agency for the Power the South Bay Project for which the franchise is being considered. The CPUC has prepared an Environmental Impact Report (EIR) for the Project, and LS Power Grid California has obtained a Certificate of Public Convenience and Necessity (CPCN) and will obtain a Notice to Proceed (NTP) from the CPUC to begin work. The City Council is being asked to adopt the attached resolution adopting the CPUC EIR and related mitigation programs and issue findings as the responsible agency under CEQA.
The Final Environmental Impact Report (FEIR) for the Power the South Bay Project can be found at the weblink referenced below in this report.
WEBLINKS:
FEIR
Volume 1:
https://ia.cpuc.ca.gov/environment/info/esa/psb/pdfs/Vol_I_Power_the_SouthBay_FEIR.pdf Volume 2:
https://ia.cpuc.ca.gov/environment/info/esa/psb/pdfs/Vol_II_Power_the_SouthBay_FEIR.pdf Volume 3:
https://ia.cpuc.ca.gov/environment/info/esa/psb/pdfs/Vol_III_Power_the_SouthBay_FEIR.pdf
MMRP
https://ia.cpuc.ca.gov/environment/info/esa/psb/pdfs/PSB_MMCRP_2026-03-30.pdf
Council Staff Report (ID # 5666) Meeting of April 7, 2026 Updated: 4/3/2026 9:26 AM by Dina Lewis Page 3
ATTACHMENTS:
• Project Aerial Map
• Franchise Public Benefits
• Resolution Adopting CPUC EIR with Findings
• 4-2 Franchise Ordinance Formatted
RECOMMENDATIONS:
1. Hold a public hearing and introduce an ordinance granting a franchise to LS Power Grid California, LLC, for the purpose of transmitting electric service in the City’s public rights-of-way.
2. Adopt a resolution (1) adopting the Power the South Bay Project Environmental Impact Report, prepared by the California Public Utilities Commission (A.24 -05- 014; SCH NO. 2024071095); (2) making certain findings as the responsible agency for purposes of and pursuant to the provisions of the California Environmental Quality Act of 1970; and (3) adopting a related Mitigation Monitoring and Reporting Program and Construction Impact Mitigation Plan , in connection with the approval of discretionary actions by the city necessary for the construction and operation of the Power the South Bay Project
3. Authorize the City Manager, or her designee, to execute any agreements and documents necessary to effectuate the ordinance.
4. Direct the City Clerk to publish a summary of the ordinance.