Standard LSE Plan
LANCASTER CHOICE ENERGY
2026 INTEGRATED RESOURCE PLAN
AUGUST 10, 2026
1 Table of Contents
I. Introduction and Executive Summary ................................................................................ 4 LCE respectfully requests that the Commission certify this IRP. ................................. 6 As both the Legislature and the Commission have recognized, the Legislature has granted CCAs broad authority to procure resources on behalf of their respective customers, an authority limited only where “other generation procurement arrangements have been expressly authorized by statute.” Likewise, the Legislature has granted CCAs autonomy in setting their own rates and managing interactions with their customers. LCE understands that the Commission has three primary interests in the CCA IRP process: ............................. 6 • Ensuring that CCA IRPs provide requisite procurement information needed by the Commission to develop its statewide plan. ........................................................... 6 • Ensuring that CCAs’ current and planned procurement is consistent with the RA requirements established pursuant to PUC Section 380.5. ............................ 6 • Ensuring that CCAs’ current and planned procurement satisfies the CCA’s share of renewables integration resources identified in the Commission’s PSP, and that the CCA either self-provides or pays for investor-owned utility (“IOU”) procurement to support its share of any renewable integration shortfall. ............ 6
LCE has prepared its IRP with these interests in mind, and thanks the Commission for recognizing and preserving CCA procurement autonomy as well as the benefits of a collaborative planning approach with CCA organizations in its certification review of LCE’s IRP. ....................................................... 6
This narrative provides a detailed description of the development and content of LCE’s PCPs, each portfolio’s compliance with applicable requirements, and an action plan detailing LCE’s next steps (to promote conformance with such requirements). ................................................................................................................................... 7
II. Study Design ................................................................................................................................. 8 a. Objectives .................................................................................................................................... 8 b. Methodology ............................................................................................................................... 9 Modeling Tool(s) ........................................................................................................................... 9 a. For new resource selection, LCE relied upon the modeling and assumptions in the Preferred System Portfolio, LCE’s ongoing and recent procurement experience, and consultation with CalChoice, which helped 2 shape assumptions related to resource availability and cost. In addition, LCE’s new resource selection reflected the preferences of its City Council, including considerations related to resource location and availability. ................................ 10 Modeling Approach .................................................................................................................... 10 III. Study Results .............................................................................................................................. 12 b. Conforming Portfolio .......................................................................................................... 12 c. Preferred Conforming Portfolio ...................................................................................... 14 a. LCE Preferred Conforming Portfolio ............................................................................. 14 d. GHG Emissions Results ....................................................................................................... 17 e. Local Air Pollutant Minimization and Disadvantaged Communities .............. 17 i. Local Air Pollutants .......................................................................................................... 17 ii. Focus on Disadvantaged Communities .................................................................. 18 iii. Power Procurement in DACs ................................................................................... 19 f. Cost and Rate Analysis ....................................................................................................... 20 g. System Reliability Analysis ................................................................................................ 21 i. Hydro Generation Risk Management ........................................................................... 23 j. Long-Duration Storage Planning ................................................................................... 23 k. Clean Firm Power Planning ............................................................................................... 24 l. Non-CAISO, including Out-of-State, Wind Planning ............................................ 24 m. Offshore Wind Planning ................................................................................................ 24 n. Transmission Planning ........................................................................................................ 24 IV. Action Plan ............................................................................................................................... 26 a. Proposed Procurement Activities and Potential Barriers ..................................... 26 i. The LSE should provide responses for each of the following resource categories: Resources to meet IRP mandated procurement requirements, including D.21-06-035 and D.23-02-040: ...................................................................... 26 i. Plans for resources that are currently non-candidate in CPUC’s IRPs not described above ........................................................................................................................ 26 ii. Other renewable and/or zero carbon resources not described above ..... 26 iii. Other energy storage not described above ...................................................... 27 3 iv. Other demand response not described above ................................................ 27 v. Other energy efficiency not described above ...................................................... 27 vi. Other distributed generation not described above ...................................... 27 vii. Transportation electrification, including any investments that correspond to different levels than what is included in Integrated Energy Policy Report (IEPR) ................................................................................................................. 27 viii. Building electrification, including any investments that correspond to different levels than what is included in Integrated Energy Policy Report (IEPR) 27
ix. Potential Centralized Procurement, pursuant to AB-1373 ......................... 28 x. Other ...................................................................................................................................... 28 b. Disadvantaged Communities (DACs) ........................................................................... 28 i. Joint CCA Disadvantaged community green tariff Program (DAC-GT) ..... 28 ii. Power Choice CARE – Distributed Microgrids Program................................... 29 c. LSEs’ Tribal Customers ........................................................................................................ 29 d. Procurement Products ........................................................................................................ 29 e. Commission Direction of Actions................................................................................... 30 V. Lessons Learned ........................................................................................................................ 30 Glossary of Terms............................................................................................................................... 32
4 I. Introduction and Executive Summary
Description of LCE
The City of Lancaster is a municipal corporation and charter city organized and operated under the laws of the State of California. The City of Lancaster is governed by, and accountable to, representatives elected by its citizens. The City of Lancaster operates numerous programs for the benefit of its citizens, including Lancaster Choice Energy (“LCE”).
LCE was formed by the Lancaster City Council on May 27, 2014, through Ordinance 997 and began serving load in May 2015. LCE currently provides retail electric generation services and complementary energy programs to customers within the municipal boundaries of the City of Lancaster. LCE launched as the City’s Community Choice Aggregation (“CCA”) program for the purposes of promoting local control and local economic benefits as well as offering participating customers competitive and stable rates.
Figure 1: Service Area Map
LCE currently serves approximately 47,700 residential accounts and 5,600 commercial and industrial accounts. LCE provides retail generation service to a variety of customer classes, including residential, small and medium commercial accounts, large industrial consumers, and agricultural and pumping facilities. LCE’s service area has a population of approximately 169,000, the majority of which live in households or work at businesses that receive generation service from LCE. In 2025, LCE had a peak load of 190 MW, and a total 2025 energy usage of 540 GWh.
Lancaster
5 LCE has pursued CCA implementation activities under a shared service model, which means LCE has joined together with other, regionally located and city specific CCA programs to promote administrative efficiencies by outsourcing many operational and technical services typically required for CCA administration and operation. The California Choice Energy Authority, or CalChoice, is the organization selected by LCE to provide requisite services, including resource planning and procurement activities.
Key decisions of LCE, including rate setting, retail supply portfolio composition, disposition of financial reserves, and administration of complementary programs, are addressed by the Lancaster City Council with supporting input from LCE staff and CalChoice personnel. Due to the relatively small size of the City of Lancaster (both in terms of population and retail sales), meaningful administrative efficiencies have been achieved through joint solicitation/procurement administration through CalChoice. By partnering with CalChoice, LCE has been able to establish and pursue objectives and key parameters that are directly responsive to the unique constituents and interests within the City of Lancaster.
LCE’s Mission
LCE was formed for the express purpose of empowering the city to choose the generation resources that reflect its specific values, needs and cost preferences. More specifically, LCE seeks to provide reliable electric service, within the city, at competitive rates when compared to those rates offered by the incumbent electric utility and also prioritizes local control, economic development and environmental stewardship within the City of Lancaster. Consistent with Public Utilities Code Sections 366.2(a)(5) and 454.52 (b)(3), all procurement by LCE, including the portfolios set forth in this Integrated Resource Plan (“IRP”), must comply with policy direction provided from LCE’s governing board, which is comprised of the Lancaster City Council.
Introduction to LCE’s IRP
In accordance with the requirements of California Public Utilities Code (“PUC”) Sections 454.51 and 454.52 and California Public Utilities Commission (“Commission” or “CPUC”) Decision (“D.”) 18-02-018, D.22-02-004, Administrative Law Judge’s Ruling Setting Requirements for Individual Integrated Resource Plans Due June 1, 2026, Email Ruling Granting Joint Request for Extension of Load Serving Entity (“LSE”) Integrated Resource Plan (“IRP”) Filings, and guidance provided by the Commission’s Energy Division, LCE is providing its LSE-specific IRP to the Commission for certification and use in the Commission’s statewide planning process.
In addition to this narrative, LCE’s IRP includes the following documents:
• LCE’s Resource Data Template
• LCE’s Clean System Power Calculator
• LCE’s IRP Verification
Projecting resource needs over the planning horizon covered by the IRP is a fluid process and LCE expects changes over time. The future resources identified in LCE’s IRP represent LCE’s current good- faith projection of the resource mix that will be procured over the IRP planning horizon. Such projections are based on best available information regarding planning directives, LCE policy, resource availability and other key considerations. The resources identified in future iterations of LCE’s IRP may change due to new information and evolving circumstances, and the ultimate resource mix that LCE actually procures (in future years) may differ from what is reflected in this plan due to a number of variables, including availability of supply, technology changes, price of supply, and/or other market or regulatory considerations.
6 Board Council Approval of IRP
In compliance with Public Utilities Code Section 454.52(b)(3), this IRP was formally submitted to the Lancaster City Council for approval based on the IRP’s compliance with Sections 454.51 and 454.52 (the “IRP Statute”) and all relevant council-adopted procurement requirements of LCE’s governing council.
On July 14, 2026, the Lancaster City Council issued a Resolution which formally approved this IRP and adopted LCE’s Preferred Conforming Portfolio (“PCP”). LCE’s Resolution also made the following determinations regarding LCE’s PCP:
• LCE’s PCP is expected to achieve economic, reliability, environmental, security, and other benefits and performance characteristics that are consistent with the goals set forth in Section 454.52(a)(1)(A-I).
• LCE’s PCP includes a diversified procurement portfolio consisting of both short-term and long- term electricity and electricity-related and demand reduction products. • LCE’s PCP achieves the resource adequacy requirements established pursuant to Public Utilities Code Section 380.
• LCE’s PCP is consistent with the procurement timing, resource mix, and operational attributes of the Commission’s Preferred System Portfolio (“PSP”).
• LCE’s PCP is compliant with all LCE board-adopted procurement directives.
A copy of the final Resolution is available on the City’s website. 1 Request for Certification
LCE respectfully requests that the Commission certify this IRP.
As both the Legislature and the Commission have recognized, the Legislature has granted CCAs broad authority to procure resources on behalf of their respective customers, an authority limited only where “other generation procurement arrangements have been expressly authorized by statute.” 2 Likewise,
the Legislature has granted CCAs autonomy in setting their own rates and managing interactions with their customers.
3 LCE understands that the Commission has three primary interests in the CCA IRP process:
• Ensuring that CCA IRPs provide requisite procurement information needed by the Commission to develop its statewide plan.
4 • Ensuring that CCAs’ current and planned procurement is consistent with the RA requirements established pursuant to PUC Section 380.5.
5 • Ensuring that CCAs’ current and planned procurement satisfies the CCA’s share of renewables integration resources identified in the Commission’s PSP, and that the CCA either self-provides or pays for investor-owned utility (“IOU”) procurement to support its share of any renewable integration shortfall.
6 LCE has prepared its IRP with these interests in mind, and thanks the Commission for recognizing and preserving CCA procurement autonomy as well as the benefits of a collaborative planning approach with CCA organizations in its certification review of LCE’s IRP. 7 This narrative provides a detailed description of the development and content of LCE’s PCPs, each portfolio’s compliance with applicable requirements, and an action plan detailing LCE’s next steps (to promote conformance with such requirements).
LCE developed its IRP through the following steps:
• LCE compiled data for its existing energy contracts, RA capacity contracts, and its share of capacity for allocated Cost Allocation Mechanism (“CAM”) resources. • For each IRP planning year, LCE identified its short positions relative to known planning targets and its assigned load forecast.
• LCE populated the Resource Data Template with all current contracts. • LCE compiled detailed information on projects for which it is currently negotiating power purchase agreements, including information regarding project status and timing • LCE identified future contracts it expects to secure for new solar, storage, geothermal, and wind generation. LCE prioritized the selection of future resources to ensure that LCE’s overall portfolio of new resources is varied, meets all regulatory goals, meets the goals expressed by LCE’s City Council, and is estimated to minimize costs to customers, subject to applicable mandates. LCE added generic future contracts with existing resources, including large hydroelectric generators, to help fill its remaining open positions. • LCE used the Commission’s Clean System Power Calculator Tool to check the GHG emissions associated with the resulting portfolio to ensure that these emissions are equivalent to, or slightly less than, LCE’s assigned share of the GHG emissions benchmarks; LCE added planned purchases of RPS qualifying renewable and large hydroelectric energy in sufficient volume to
1 https://lancasterenergy.com/
2 PUC Section 366.2(a)(5).
3 D.05-12-041 at 9-11 (“Nothing in the statute directs the CPUC to regulate the CCA’s program except to the extent that its programs may affect utility operations and the rates and services to other customers. For example, the statute does not require the CPUC to set CCA rates or regulate the quality of its services… We are confident that existing law protects CCA customers. Entities of local government, such as CCAs, are subject to numerous laws that will have the effect of protecting CCA customers and promoting accountability by CCAs…”). 4 D.19-04-040 at 17-18 (“The Commission’s portfolio aggregation and evaluation process, which relies of fulfillment of IRP filing requirements by LSEs, is the only process capable of assessing the overall needs of the CAISO grid and meeting the statewide GHG, reliability, and least-cost goals collectively. While LSEs may use their IRP process to meet local planning needs as well, the statewide planning function is the statutorily required process . . .”).
5 Section 454.52(b)(3)(C).
6 Section 454.51.
8 ensure that portfolio emissions were equal to, or slightly less than, LCE’s assigned share of the GHG benchmark.
• LCE identified the resulting portfolio as its PCP
LCE reached the following findings regarding its PCP:
• LCE’s PCP includes the procurement of the following new resources:
o New solar resources totaling 195MW solar
o New battery storage resources totaling 168 MW
o New wind resources totaling 76 MW
o New geothermal resources totaling 11 MW
• LCE’s PCP provides for the following overall resource mix in 2045:
o 19 GWh of Large Hydro
o 109 GWh of Geothermal
o 265 GWh of Wind
o 686 GWh of Solar
o 362 MWh of Short Duration Battery Storage
o 754 MWh of Long Duration Storage
o 116 MW of Natural Gas/Baseload/Other (Capacity-Only)
• LCE’s PCP conforms to the procurement timing, resource quantities, and general resource attributes identified in the PSP.
• LCE’s PCP would have GHG emissions of 0.065 MMT, 0.051 MMT, 0.045 MMT, and 0.027 MMT in 2030, 2035, 2040, and 2045, respectively, which is equivalent to or less than LCE’s assigned GHG benchmarks for those years.
• LCE’s PCP meets all relevant reliability metrics.
• LCE’s PCP provides approximately LCE’s load-proportional share of renewable integration resources.
II. Study Design
a. Objectives
LCE had the following objectives in performing the analytical work to develop its IRP:
1. Identify a PCP with emissions equal to or slightly less than LCE’s proportional share of the 8 MMT GHG reduction benchmark, as determined using the Commission’s emissions calculator.
2. Identify a PCP that achieves economic, reliability, environmental, security, and other benefits and performance characteristics that are consistent with the goals set forth in Section 454.52(a)(1)(A-I).
3. Identify diverse and balanced PCP that includes both short-term and long-term electricity products as well as electricity-related demand reduction products.
4. Identify portfolios that achieve the resource adequacy requirements established pursuant to PUC Section 380 and provide LCE’s share of system reliability and renewable integration resources.
9 5. Identify a portfolio that complies with all of LCE’s Board-adopted procurement directives.
6. Identify a portfolio that is compliant with LCE’s obligations under the Renewables Portfolio Standard (“RPS”) program.
7. Identify a portfolio that is cost-effective and minimize rate impacts on LCE’s customers. b. Methodology
Modeling Tool(s)
In developing its planned portfolios, LCE used the modeling performed by the Energy Division using RESOLVE and SERVM and incorporated applicable outputs into the RDTv3 and CSP templates as a starting point. After evaluating related results, LCE consulted with CalChoice, leveraging its extensive experience and expertise in the areas of resource planning and procurement, to construct LCE’s own, internally developed models to quantify portfolio targets for renewable energy content, capacity, and portfolio GHG emissions, as well as physical and financial positions conforming with LCE’s currently effective risk management policies and business practices.
LCE also utilized its commercial energy trading and risk management system to monitor positions, market exposure, credit exposure, value-at-risk, and other risk management metrics. LCE has maintained a record of all such transactions in this system for several years and plans to continue using this system to facilitate transaction management, resource planning, and risk management activities.
LCE used the outputs of its energy trading and risk management system to develop reports and models which were then analyzed to assess annual, monthly, and hourly open positions by considering all forecasted electric loads and expected deliveries from LCE’s resource portfolio. LCE also used a proprietary financial model to project power supply costs based on existing and planned procurements as well as an overall financial assessment of revenues, costs, and cash flows. Current market conditions were considered when compiling any costs associated with expected/planned purchases; actual costs, based on existing procurement contracts, were incorporated as appropriate. Similar to the aforementioned energy trading and risk management system, LCE has used this financial model for several years and has found it to be highly effective in supporting the financial planning needs of its CCA program.
10 a. For new resource selection, LCE relied upon the modeling and assumptions in the Preferred System Portfolio, LCE’s ongoing and recent procurement experience, and consultation with CalChoice, which helped shape assumptions related to resource availability and cost. In addition, LCE’s new resource selection reflected the preferences of its City Council, including considerations related to resource location and availability.
Modeling Approach
Load Forecast
LCE developed this IRP using its assigned load forecast from the file 2026 LSE GHG Emission Benchmarks7 (also contained in the CSP templates), as directed in the Final Ruling.
Table 1: LCE’s 2026-2045 Load Forecast (GWh)
Year Load Forecast
2026 591.97
2027 617.87
2028 652.17
2029 684.02
2030 718.50
2031 748.48
2032 779.87
2033 811.68
2034 845.22
2035 878.16
2036 902.39
2037 925.20
2038 945.60
2039 964.08
2040 980.74
2041 995.24
2042 1,009.79
2043 1,022.23
2044 1,030.26
2045 1,037.56
7 7 See Load Forecastss + GHG Benchmarks (January 16, 2026) (hereinafter ”GHG Benchmarks”), available at https://www.cpuc.ca.gov/industries-and-topics/electrical- energy/electric-power-procurement/long-term-procurement-planning/2024-26-irp- cycle-events-and-materials.
11 Load Shape
In developing its portfolio LCE used the default load shape from the Clean System Power Calculator. Use of this load shape does not change LCE’s total annual energy volumes for both load and load modifiers, and these energy volumes remain consistent with LCE’s assigned load forecast.
Load-Proportional GHG Emissions Benchmark
LCE’s modeling was assessed against its 2030 and 2045 load-proportional share of the respective GHG emissions benchmarks, which yielded the following results:8
Table 2: LCE’s Assigned Shares of GHG Reduction Benchmarks 2030 2035 2040 2045
0.067 0.055 0.050 0.027
Compiling Existing Resources
To populate its baseline resource templates, LCE added existing resources from the following procurement categories:
• Energy Contracts.
• Capacity (Resource Adequacy) Contracts.
• LCE’s assigned share of capacity for CAM resources, taken from Energy Division’s Aggregated CAM Resources for LSEs Plan Development (September 29, 2022). • LCE’s selected Voluntary Allocation and Market Opportunities (“VAMO”) allocation of RPS resources from Southern California Edison Company (“SCE”) • LCE’s allocation of GHG-free resources from SCE
Selecting New Resources
To identify its new resource procurement opportunities, LCE first determined the new resource capacity it intends to add each year, which considered resource needs (open positions), long-term renewable contracting requirements, renewable portfolio standards, resource adequacy requirements, the need for incremental resource adequacy capacity to contribute to system reliability and renewable
integration needs, the potential for technological improvements, and financial considerations. LCE selected resource types based on its experience with competitive solicitations for new renewable and storage resources and its experience in procuring resource adequacy resources, as well as consideration of the studies and modeling underlying the adopted PSP.
8 See 2022 Final GHG Emission Benchmarks for LSEs, (June 28, 2022) (hereinafter” GHG Benchmarks”), available at https://www.cpuc.ca.gov/-/media/cpuc- website/divisions/energy-division/documents/integrated-resource-plan-and-long-term- procurement-plan-irp-ltpp/2022-irp-cycle-events-and-materials/2022-final-ghg- emission-benchmarks-for-lses_public.xlsx.
12 Confirming Reliability
LCE’s portfolios were evaluated to ensure that sufficient dependable capacity (net qualifying capacity) would be available to meet peak load requirements, as shown in the RDTv3. These requirements include procuring sufficient net qualifying capacity to meet the Planning Reserve Margins applicable to each year of the planning period. LCE used technology-specific Effective Load Carrying Capacity (“ELCC”) factors from the RDT to assess the contribution of each resource to system reliability. The ELCCs for battery storage resources degrade precipitously during the planning period, which means that battery resources provide less net qualifying capacity per MW of nameplate capacity. In order to ensure that its portfolio met the reliability requirements in each year of the planning period, LCE added sufficient short- term RA capacity as needed to supplement capacity from its long-term portfolio. LCE’s portfolio was designed to ensure that current incremental resource adequacy capacity obligations from the various CPUC procurement orders will be met.
Calculating GHG Emissions
LCE calculated the emissions associated with its PCP using the Commission’s Clean System Power calculator. The assigned load forecast and default load shapes and behind the meter adjustments were used for this assessment, along with the planned supply portfolios. The results were checked against the assigned GHG benchmarks included in the Clean System Power tools.
III. Study Results
b. Conforming Portfolio
LCE’s Conforming Portfolio
The following table provides a summary of LCE’s 2045 PCP, identifying resources by type and distinguishing between the following procurement categories:
• Existing resources (energy and capacity) that LCE owns or contracts with, consistent with definitions provided in the Resource Data Template.
• Existing resources (energy and capacity) that LCE plans to contract with in the future. • Existing resources (capacity) that LCE partially pays for through CAM. • New Resources (energy and capacity) that are under development that LCE is planning to procure.
• Future new resources (energy and capacity) that LCE is planning to procure.
In summary, to meet LCE’s projected 2045 energy demand of 1,038 GWh, LCE has selected a 2045 PCP Conforming Portfolio composed primarily of the following resources:
• Solar, planned existing: 150 GWh
• Solar, planned new: 536 GWh
• Wind, planned existing: 50 GWh
• Wind, CA, planned new: 63 GWh
13 • Wind, New Mexico, new: 85 GWh
• Wind, Wyoming, new; 66 GWh
• Large Hydro, existing: 19 GWh
• Geothermal, new: 84 GWh
• Battery storage, new: 1087 GWh dispatch capability
Additionally, LCE’s 2045 PCP includes capacity-only resources composed primarily of the following resources:
• CAM, Demand Response and Energy Efficiency Allocations – 32 MW • Existing natural gas, baseload, and other (planned procurement) – 116MW LCE’s portfolio includes a mix of existing and new resources. Approximately 443 MW of LCE’s PCP is composed of new resources, reflecting LCE’s role as an active player in the State’s development of new renewable and storage resources. Furthermore, LCE’s PCP is comprised of a mix of resources in which LCE can minimize customer rate impacts while still achieving the State’s GHG-reduction targets.
LCE’s PCP Is Consistent with the Preferred System Plan
The new resources included in LCE’s PCP are consistent with the PSP 2045 new resource mix. The Commission adopted the PSP, which established the 8 MMT GHG target by 2045 and adopted the resources in Tables 5 and 6 of D.22-02-004.9
The Decision requires that LSEs procure resources in the following categories: Gas, Biomass, Geothermal, Wind, Wind on New-Out-of-State Transmission, Offshore Wind, Utility-Scale Solar, Battery Storage, Pumped (Long-Duration) Storage, Shed Demand Response.
As demonstrated in the following table, LCE’s PCP is generally consistent with LCE’s proportional share of new procurement for each of the “resource types” identified in D.22-02-004.
Table 3: Comparison of LCE’s PCP vs PSP
Resource Category PSP (MW) LCE’s Proportional
Share of PSP New
Resources (MW)
LCE’s PCP (MW)
Geothermal 3,230 11.39 11
Geothermal (Enhanced) 674 2.38 0
Biomass 12 0.04 0
In-State Wind 10,949 38.62 27
Out-of-State Wind 19,036 67.14 49
Solar 82,732 291.81 188
Li-ion Battery (4-hr) 6,758 23.84 83
9 D.22-02-004 at 101-105. Note the Decision references Tables 6 and 7, but this was presumably a typographical error since there was no foregoing Table 7. Thus, LCE understands the Decision to be referencing Tables 5 and 6. 14 Li-ion Battery (8-hr) 21,102 74.43 85
Location Constrained
Storage (12-hr)
8,499 29.98 0
c. Preferred Conforming Portfolio
a. LCE Preferred Conforming Portfolio
As demonstrated in Table 3 above, LCE’s IRP, LCE’s PCP consists of a combination of:
• Natural Gas
• Biomass
• Geothermal
• Wind
• Wind on New-Out-of-State Transmission
• Utility-Scale Solar
• Hybrid Solar Plus Storage
• Battery Storage
• Pumped (Long-Duration) Storage
• Shed Demand Response
As stated above, in accordance with Section 454.51(b)(3), LCE’s governing board has determined that the resource mix in the PCP achieves “economic, reliability, environmental, security, and other benefits and performance characteristics that are consistent with the goals set forth in [Section] 454.51(a)(1)].” These benefits and characteristics are discussed as follows.
GHG Reduction Goals
LCE’s PCP achieves results and performance characteristics consistent with the Section 454.52(a)(1)(A) goal of meeting the Commission’s 8 MMT GHG reduction benchmark (8 MMT GHG by 2045). The 2035 emissions from LCE’s PCP are equivalent to LCE’s load-proportional share of the 8 MMT by 2035 emissions target. LCE’s proportional share of the 8 MMT GHG target is 0.0274 MMT in 2045. According to the Commission’s emissions calculator, LCE’s PCP would account for 0.0273 MMT in 2045 emissions, which is less than the GHG Benchmarks for LCE.
Renewable Energy
LCE’s PCP achieves results and performance characteristics consistent with the Section 454.52(a)(1)(B) goal of ensuring that portfolios are composed of at least 60% eligible renewable resources. In 2030 LCE’s PCP portfolio would consist of 61% eligible renewable generation, after accounting for resource curtailments, which exceeds the 60% requirement. In 2045, LCE’s PCP portfolio would consist of 95% eligible renewable generation after accounting for resource curtailments.
Enable Each Electrical Corporation to Fulfill Its Obligation to Serve Customers at Just and Reasonable Rates
15 As detailed in Section III.e., below, LCE is committed to serving its customers at reasonable rates. In addition to setting rates that are competitive with SCE, LCE works to minimize rate volatility by constructing a balanced and conservatively hedged power supply portfolio, building prudent financial reserves, and minimizing rate changes to once per year, whenever possible.
Minimizing Bill Impact
LCE’s PCP achieves results and performance characteristics consistent with the Section 454.52(a)(1)(D) goal of minimizing the impact of planned procurement on ratepayers’ bills. LCE’s PCP portfolio consists primarily of renewable resources that generally support a least-cost, best-fit procurement strategy.
LCE’s planned use of large hydro resources is expected to minimize costs associated with lowering GHG emissions because the cost premiums associated with large hydro energy is less than those associated with RPS qualifying renewable energy.
LCE prioritizes cost competitiveness, reliability, use of renewable energy and local economic development amongst its primary concerns. LCE anticipates that bill impacts will be minimized during its planned portfolio transition through the pursuit of a diversified resource mix that seeks to minimize exposure(s) that could otherwise occur by overemphasizing resources located within specific geographic areas, relying on a limited subset of technology types and/or purchasing from a limited pool of suppliers/developers, amongst other considerations. LCE is also aware of the risks associated with certain renewable-only generating configurations that limit the buyer’s ability to re-shape deliveries to times of the day when negative prices and, possibly, curtailments are less likely to occur. With this concern in mind, LCE has carefully considered and incorporated energy storage opportunities within its resource mix, which should promote grid reliability during California’s transition to an increasingly clean/renewable energy mix while reducing the potential for unforeseen costs (due to negative pricing) and/or reduced renewable energy deliveries related to curtailment. For example, coupling new-build solar with battery storage increases the capacity value of such projects and provides limited dispatchability for the solar generation, reducing risks related to curtailment and negative pricing.
Further, LCE’s PCP reduces exposure to volatile natural gas prices as well as bill impacts that may result from periodic spikes in fossil fuel prices.
Ensuring System and Local Reliability
LCE’s PCP achieves results and performance characteristics consistent with the Section 454.52(a)(1)(E) goal of ensuring system and local reliability. The PCP meets system resource adequacy requirements as detailed in Section III.f. With the adoption of the Central Procurement Entity structure, LCE no longer has local resource adequacy requirements since the CPE has taken over the procurement of local resource adequacy capacity within LCE’s service area, pursuant to D.20-06-002. LCE’s portfolio assumes CAM allocations and CAM resources, which incorporate CPE system and flexible capacity allocations, consistent with what is described in the most recently issued CPE procurement allocations. At this point, uncertainties and initial implementation issues with the CPE make it difficult for LCE to estimate how the CPE structure will change LCE’s RA needs over time.
As it has done in the past, and as shown in most state planning studies, LCE anticipates that it will meet a portion of its reliability needs through capacity-only contracts with natural gas plants. LCE has contracted with demand response resources to fulfill some of its RA needs and is exploring other opportunities for demand response. LCE is hopeful that new technologies will be developed that will provide cleaner resources with the reliability characteristics of California’s existing natural gas fleet, and it will continue to investigate such resources as appropriate. This noted, one of LCE’s primary concerns is supporting ongoing grid reliability, which compels the CCA program, in the near term, to include natural 16 gas resources amongst its resource adequacy purchases until such time that clean, reliable capacity becomes more readily available.
Ensure that at least 65% of RPS Procurement is From Long-Term Contracts
Consistent with Section 454.52(a)(1)(F), LCE is on pace to meet the requirement that 65% of its RPS procurement must come from contracts of 10 years (long-term or more for each compliance period. For the current compliance period, LCE has procured 80% from long-term contracts. Additionally, the majority of the resources shown in LCE’s PCP are expected to be acquired through long-term contracts.
LCE will continue to procure renewables through short-term contracts when opportunities present themselves for cost-efficient procurement and when doing so would reduce any remaining dependency on system power.
Strengthen the diversity, sustainability, and resilience of the bulk transmission and distribution systems, and local communities
LCE’s PCP achieves results and performance characteristics that strengthen the diversity, sustainability and resilience of the bulk transmission and distribution systems, as well as local communities, meeting Section 454.52(a)(1)(G). LCE’s PCP relies on procurement from a variety of resource types as well as significant storage resources incorporated in hybrid solar and storage configuration. LCE believes that the complementary nature of the solar and storage in hybrid resources makes better use of the existing transmission system. LCE carefully evaluates the long-term generation load-matching and congestion risks of new resources and weighs its options in the context of its existing supply and net demand on an hourly basis for the full duration of any contract period.
As described below, LCE is actively pursuing the procurement of or has recently purchased capacity to meet the sub-category requirements of D.21-06-035, which includes long-duration storage, clean-firm resources like geothermal, and resources to replace the Diablo Canyon Power Plant. Additionally, LCE has recently procured demand response capacity resources, providing additional system diversity.
Demand-Side Energy Management
LCE’s PCP achieves results and performance characteristics consistent with the Section 454.52(a)(1)(H) goal of enhancing demand-side energy management. LCE continues to explore and pursue demand-side management programs such as demand response, energy efficiency, and behind the meter energy storage solutions. As part of LCE’s procurement toward D.21-06-035, as discussed in more detail in Section IV.a.ii., LCE has contracted for demand response resources to meet a portion of its requirements.
Distributed energy resources (DER) programs support customer energy cost reduction, GHG reductions, and air quality improvements. Such programs help CCAs reduce costly energy purchases, while some may earn revenue from wholesale market participation. Demand response programs provide customers an opportunity to play a role in the operation of the electric grid by reducing their electricity usage during peak demand days when market prices are highest (“peak events”) in exchange for financial incentives.
With the recent expansive deployment of DERs in CalChoice member jurisdictions (such as smart thermostats, rooftop solar and battery storage systems, and electric vehicles and chargers; aka “behind- the-meter” assets), the groundwork is being laid to establish a virtual power plant (VPP) for the benefit of CalChoice Members. Through a VPP, each CCA program may create, monitor, and control a fleet of 17 assets to modify load when power is expensive, and reduce stress on the grid during called events and/or during certain market conditions. Implementation of such a program requires a third-party supplier to provide the DERMS software for management of the devices. In addition, it also requires an experienced program administrator to establish a future demand response incentive offering for CalChoice Member customers. The program administrator will also be responsible for integration and coordination of DER assets with third-party owners.
CalChoice is currently exploring opportunities to launch a DERMS and develop its customer incentive demand response program for 2026-2027.
Minimizing Localized Air Pollutants with Emphasis on Disadvantaged Communities (“DACs”)
LCE’s PCP achieves results and performance characteristics consistent with the Section 454.52(a)(1)(I) goal of minimizing localized air pollutants and other GHG emissions with early priority on disadvantaged communities. LCE’s PCP relies primarily on renewable generation and hydroelectric generation, and this portfolio is expected to exhibit relatively low GHGs and localized air pollution emissions. LCE’s PCP minimizes LCE’s reliance on unspecified system power, instead opting for renewable and hydroelectric generation procurement/development whenever feasible. Results from the CSP tool indicate the following localized air pollutants associated with LCE’s PCP in 2045:
• NOx: 3 tonnes/year
• PM 2.5: 2 tonnes/year
• SO2: 0 tonnes/year
These emissions are expected to result from the planned use of system energy and biomass energy in the PCP, as well as emissions from Combined Heat and Power (“CHP”) resources and system energy assigned to the LCE portfolio by the CSP tool. In evaluating new use of biomass resources, LCE will prioritize those located outside of DACs to the greatest practical extent. d. GHG Emissions Results
LCE used its load-based proportional share of the 8 MMT GHG Benchmark to determine the emissions compliance for its 8 MMT PCP. LCE’s assigned load proportional share of the 8 MMT benchmark in 2035 is 0.0552 MMT and in 2045 is 0.0274 MMT. Based on the 8 MMT version of the CSP calculator, LCE’s 8 MMT PCP would result in total 2035 GHG emissions of 0.0512 MMT and 2045 GHG emissions
0.0273MMT, which is slightly less than LCE’s assigned share of the 8 MMT GHG reduction benchmark. e. Local Air Pollutant Minimization and Disadvantaged Communities i. Local Air Pollutants
The CSP calculator estimates the following emissions associated with LCE’s 8 MMT portfolio:
Table 4: PCP Air Pollutants
Pollutant 2030 2035 2040 2045
PM2.5 4 4 3 2
SO2 0 0 0 0
NOx 6 6 6 3
18 LCE’s contribution to air pollutants is a result of a combination of electricity procured from biomass and from reliance on system power. The table below shows the portion of load that is being served from fossil fuel resources and system power each year the portfolio.
Table 5: 8 MMT Portfolio Demand, Fossil Fuel Resources and System Power 2030 2035 2040 2045
Demand 782 955 1,067 1,129
Net System Power 144 123 131 97
% of Load Served
by System Power
20% 14% 13% 9%
ii. Focus on Disadvantaged Communities
LCE’s IRP is consistent with the goal of minimizing local air pollutants, with early priority on DACs. As defined by the CalEPA’s designation, a Disadvantaged Community includes four categories:
• Census tracts receiving the highest 25 percent of overall scores in CalEnviroScreen 4.0 (1,984 tracts).
• Census tracts lacking overall scores in CalEnviroScreen 4.0 due to data gaps but receiving the highest 5 percent of CalEnviroScreen 4.0 cumulative pollution burden scores (19 tracts). • Census tracts identified in the 2017 DAC designation as disadvantaged, regardless of their scores in CalEnviroScreen 4.0 (307 tracts).
• Lands under the control of federally recognized Tribes.
LCE serves customers in the following DACs:
Figure 2: Map of DACs within LCE’s Service Area
19 LCE’s service area includes the following DAC census tracks:
• Among the highest 15% of census tracts
o 6037900602: CalEnviroScreen 4.0 score of 51
o 6037900701: CalEnviroScreen 4.0 score of 51
o 6037900804: CalEnviroScreen 4.0 score of 49
o 6037900806: CalEnviroScreen 4.0 score of 48
• Among the highest 20% of census tracts
o 6037900501: CalEnviroScreen 4.0 score of 47
o 6037900607: CalEnviroScreen 4.0 score of 45
o 6037900606: CalEnviroScreen 4.0 score of 44
• Among the highest 25% of census tracts
o 6037900703: CalEnviroScreen 4.0 score of 41
iii. Power Procurement in DACs
LCE does not currently procure electricity directly from any natural gas or other fossil fuel power plants.
However, LCE recognizes the need to help mitigate the impacts of air pollution in regions of the state where communities have been disproportionately impacted by the existing generating fleet and the need for economic development in areas with high unemployment and poverty.
Our planning objective is to minimize unspecified system power usage and prioritize clean resources that reduce local pollution burdens across the State. Where grid capacity exists within our communities, we are particularly conscious of local areas with high cumulative pollution scores. In procurement practice, this involves prioritizing biomass facilities located outside of DACs and renewable generation with the greatest potential for displacement of fossil fuels, wherever practical: in its solicitations LCE requests respondents to identify how the submitted projects may replace or supplant existing generation and to quantify the expected emissions impacts of this transition.
As required in this 2026 IRP submission, LCE has also analyzed its existing portfolio of long-term contracts and their relationship to DACs within a 5-mile radius. While LCE does not have direct data showing emissions reductions as a result of these projects (many are not yet operational), LCE’s long- term portfolio is comprised of renewable resources – solar, wind, geothermal – and battery storage capacity which all are anticipated to have either a positive impact or negligible impact on emissions and have the potential to displace emitting generation.
Table 6: PCP Air Pollutants
Project Type Project Location Census Tract DACs in 5-mile radius Solar Plus Storage Terra Bella, CA 6107004500 6107003400, 6107004200, 6107004500
20 f. Cost and Rate Analysis
LCE’s 8 MMT PCP is reasonable from a cost perspective. In selecting resources for its portfolios, LCE carefully considered the cost implications of specific resource selections and procurement timing. This analysis was informed by LCE’s procurement experience and the standard assumptions and results of the Commission’s RESOLVE/SERVM modeling.
LCE strives to keep customer costs as low as possible. This is reflected both in the resources procured and in the timing of those procurements. LCE employs risk-management that considers risk associated with under-procurement, as well as risks of potential over-procurement which could occur from unforeseen changes in load going forward. Risk management also involves assessing the currently available technologies, expected technological developments, and potential for radically different technologies in the future. The assessment of potential resources is not strictly on price issues but includes information on how well the resources match the specific needs of LCE’s customers’ load. For example, solar resources are often the least expensive on a simple cost per MWh basis, but other resources which may cost more on a simple MWh basis may provide additional benefits in terms of RA capacity, better matching LCE’s load profile, or serving the needs of the Lancaster community.
In general, LCE sought to balance the need to procure resources with enough lead time to meet LCE’s LSE-specific procurement shortfalls and the Commission-identified overall system new resource needs with the cost-saving benefits of waiting to procure renewable and storage resources with downward sloping cost projections. LCE also recognizes that future resource costs are highly uncertain, and technological advancement can happen unexpectedly; LCE’s procurement cycle is designed to take advantage of technological and cost improvements by incrementally adding new resource commitments over time.
LCE continuously monitors the energy markets and reassesses current market prices, expected future prices, technological progress, and its expected needs. When opportunities arise LCE will take advantage of them.
Requirements for All LSEs (including non-IOUs)
LCE’s portfolio cost analysis quantifies the expected power supply costs associated with the PCP through 2045. The cost analysis incorporates expected generation costs, resource value (energy, resource adequacy, and renewable energy, as applicable), and the costs associated with resource curtailments.
Marginal ELCC values from RESOLVE were used to quantify expected net qualifying capacity values from the portfolio. As these ELCC factors decline significantly for battery storage resources over the planning period and remain low for solar resources, relatively little RA value is obtained from the solar and battery portfolio elements of the portfolio, despite large increased in nameplate capacity. The average nominal portfolio cost increases by a compound average growth rate of 1.6% annually from 2026 through 2045. The yearly average portfolio cost is shown in the following figure.
21 Figure 3: Cost Impacts
g. System Reliability Analysis
LCE’s PCP is expected to be reliable and will contribute LCE’s fair share to system reliability needs. The effective capacity of LCE’s 8 MMT PCP is provided in the following “System Reliability Progress Tracking Table” from the 8 MMT Resource Data Template dashboard (note that the row containing peak demand is confidential and has been excluded from this table). The net qualifying capacity for the month of September is shown for each year in the following table:
Table 7: System Reliability Progress Tracking, September, 8 MMT PCP
Load and Resource Table by Contract Status
2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 LSE reliability need (MW) 217 221 225 208 190 196 201 206 211 216 219 221 223 225 227 227 227 226 226 225 ELCC by contract status (effective MW)
Online 130 118 116 93 87 39 39 36 36 36 33 32 25 26 26 26 25 25 25 25 Development 8 23 21 14 7 6 10 9 9 9 7 8 8 8 8 4 4 4 4 4 Review - - - - - - - - - - - - - - - - - - - - PlannedExisting 76 76 84 97 65 119 116 121 124 116 122 124 124 116 111 115 116 111 106 98 PlannedNew - - - - 27 27 31 34 36 49 49 49 58 68 74 74 74 79 84 92 BTM PV 3 4 4 4 4 5 5 6 6 7 7 7 8 8 9 9 8 8 8 8 LSE total supply (effective MW) 217 221 225 208 190 196 201 206 211 216 219 221 223 225 227 227 227 226 226 225 Net capacity position (+ve = excess, -ve = shortfall) (effective MW) - - - - - - - - - - - - - - - - - - - - 22 Figure 4: LCE’s Capacity by Contract Status
As demonstrated in Table 7, LCE’s PCP contributes 217 MW of peak monthly NQC in 2045. Combined with LCE’s allocation of 8 MW of behind-the-meter PV, this makes for an LSE total supply of 225 MW. As shown in the table above, this NQC meets LCE’s reliability need. Of this total, 92 MW are related to new renewable and hybrid resources as well as new short- and long-duration storage resources. LCE’s PCP includes planned contracts with existing resources, which are expected to include resources within the existing natural gas generator fleet, for a total of 126 MW of NQC. This balanced portfolio of flexible capacity works to effectively and reliably integrate a renewables-heavy portfolio, thus exceeding LCE’s share of any system-wide renewable integration resource requirements. h. Existing Resource Planning
Over the last several years, LCE has been ramping up its procurement of new resources as it gains experience in contracting new resources. LCE’s portfolios still reflect a sizeable number of existing resources, but much of this is already under contract and LCE anticipates renewing existing contracts.
LCE’s PCP shows declining use of existing resources as LCE plans to work with developers to add new renewable generation to the LCE power mix. As demonstrated in LCE’s PCP, LCE will drive significant new resource development, which will have a corresponding decrease in LCE’s planned use of existing resources. Existing resources that LCE plans to utilize are generally resources that have been available and successfully contracted in the past. Some of these contracts are for multi-year terms, which provides assurance that such resources will remain available. LCE has chosen these resources because of their lower delivery risks compared to new resources. However, LCE recognizes that there is a risk that some existing resources planned for use may not be available to meet LCE’s plans. LCE’s portfolios attempt to balance out these competing risks, and, as LCE will adapt its plans should energy market conditions change. Existing resources that LCE plans to contract with are generally resources that LCE
23 has seen have been available. LCE has chosen these resources because of their lower delivery risks compared to new resources. However, LCE recognizes that there is a risk that these existing resources may not be available to meet LCE’s plans. LCE’s portfolios attempt to balance out these competing risks, and, as LCE has explained elsewhere in this document, LCE does not view its proposed portfolio as written in stone, but rather a map to be followed. LCE is always ready to change its path should the energy market change. If expected existing resources are not available, LCE will consider other possible alternatives. Even if the existing resources are available, LCE may procure new resources if doing so would reduce emissions or save money.
i. Hydro Generation Risk Management
In developing its portfolios, LCE took several steps to manage the risk of reduced hydro availability that may result from future in-state drought. First, LCE has developed a network of Pacific Northwest-based hydroelectric power suppliers, including entities that have substantial Asset Controlling Supplier (“ACS”) supply and are thus able to sell firm low-carbon supply to LCE. LCE’s PCP includes hydroelectric resources located within California as well as imported hydroelectric power from the Pacific Northwest.
Second, LCE will prioritize hydroelectric contracts with marketers that provide firm delivery volumes, helping to reduce the planning uncertainty associated with drought and variable hydroelectric conditions within California. For its PCP, LCE increased its planned use of hydroelectricity, which could be at risk under certain drought conditions. However, due to LCE’s relatively small hydroelectric needs, LCE will have a greater probability of filling its annual positions than other, larger LSEs. With that noted, under a drought scenario or in the event that other factors restrict the availability of hydroelectricity and LCE is unsuccessful in filling related shortfalls through short-term contracting opportunities, LCE would plan to substitute with renewable energy resources to ensure it meets its assigned GHG benchmark.
j. Long-Duration Storage Planning
LCE observed that the System Reference Plan includes increasing amounts of eight-hour battery storage and relatively static amounts of four-hour battery storage over the planning period. LCE has similarly planned to increase its use of long-duration storage over time. Planned solar plus storage projects beginning with the 2035 procurement tranche include eight-hour battery storage. This represents a change from the 2022 IRP in which most of the battery storage was planned as four-hour duration.
Current cost estimates are high for long duration storage, and this puts upward pressure on portfolio costs. The relatively low ELCC factors for battery storage in the RDT means that relatively little resource adequacy value is obtained, despite the high costs. As additional technologies are market-proven and more developers offer long-duration storage with potentially lower costs, LCE will consider further procurement of these resources. However, LCE will consider shorter duration storage if the economics are more attractive. LCE sees the possibility for substantial benefits from long-duration storage to the grid and for aiding LSEs in compliance with the Slide-of-Day Resource Adequacy program.
24 k. Clean Firm Power Planning
LCE views clean firm generation as a valuable element of its resource mix as it provides reliable and predictable generation with low emissions. The challenge to greater utilization of this resource type is availability and cost. The primary large scale clean firm resources are geothermal and nuclear generation. Other clean firm generation types, such as biomass and especially biogas are typically smaller-scale projects. None of these resources are abundant, and costs have been increasing rapidly due to resource scarcity and competition with non-LSE offtakers such as data centers, which could limit their role in the planned portfolio. The PCP includes new geothermal contracted and planned to come online in 2031, meeting LCE’s D.21-06-035 requirements, and planned new geothermal in 2035 and 2045. The PCP assumes other LSEs and non-LSE offtakers such as data centers are similarly procuring from the pool of available geothermal resources, further limiting how much is assumed to be available to LCE and driving up pricing.
l. Non-CAISO, including Out-of-State, Wind Planning
LCE’s planned contracting for new out-of-state wind energy projects generally follows the timeline and relative size for selected builds of this resource type from the CPUC’s RESOLVE modeling results. To date, LCE has observed various LSEs with contracts for New Mexico wind resources delivered via the SunZia transmission project. Availability of IARs remains a constraining factor for New Mexico wind, and transmission limitations are anticipated to be constraining availability of wind from other states. As compared to the 2022 IRP, the current PCP includes similar amounts out-of-state wind after adjusting for the larger load reflected in the current PCP. Transmission remains the most significant risk to LCE’s planned use of out-of-state wind.
m. Offshore Wind Planning
LCE did not include plans for offshore wind in its PCP pending further progress on development of this resource type. Potential Department of Water Resources contracts of offshore wind energy have not been assumed, but LCE could adapt future plans as needed to incorporate these resources. n. Transmission Planning
In identifying resource locations for all portfolios, LCE was guided by the following considerations:
• LCE has a general preference for resources located within its service area and the community it serves, but more generally, within Southern California. • LCE prefers projects located in areas that can utilize existing transmission infrastructure with minimal upgrade/modification costs.
• LCE prefers low-impact renewable energy projects that provide economic benefit to DACs, subject to community interest in siting projects within such locations.
Unlike the IOUs, LCE is not a transmission and distribution (“T&D”) system operator. LCE does not enjoy the benefits of a granular knowledge of Southern California Edison Company’s (“SCE”) T&D system or the CAISO grid, and LCE is not in the best position to identify optimal resource locations and does not have the expertise inhouse to determine the best locations for new resources. In practice, LCE relies on 25 project developers to conduct the research and technical studies necessary for siting potential generation projects. LCE evaluates projects offered by developers based on a variety of criteria, including transmission availability, nodal prices and potential for congestion, project viability, environmental, workforce, and other factors. As such, LCE generally utilized the PSP selected candidate resources as a guide for likely resource locations in its PCP. These should be treated as general expectations based on the aforementioned considerations, not definitive selections – actual project locations will be selected during LCE’s future solicitation processes. LCE believes that the best way to keep costs down during resource solicitations is to not limit the potential locations of the resources.
Competition among the responders to resource solicitations ensures that LCE can avail itself of the best possible resources, including allowing developers to explore different locations and select what they feel is the best location for their resource taking into account numerous factors, including the costs of any potential transmission upgrades or curtailment issues. Like most LSEs, LCE doesn’t have the necessary resources to examine all possible resource locations to find optimal one from a transmission perspective but relies on the developers of projects doing just that.
As discussed in prior sections, LCE will remain flexible with respect to identifying specific resources for its supply portfolio. If LCE’s expected resource locations become infeasible due to various constraints, or if the Commission’s modeling efforts happen to indicate that certain resource locations are no longer feasible/desirable, then LCE would ultimately locate and contract for alternative resources that fall in preferred locations. LCE also remains open to attractive project opportunities, even if those locations differ from the assumptions used in this plan. As discussed in prior sections, LCE is very nimble in administering pertinent resource planning processes. More specifically, if LCE’s expected resource locations become infeasible due to various constraints, or if the Commission’s modeling efforts happen to indicate that certain resource locations are no longer feasible/desirable, then LCE would ultimately locate and contract for alternative resources that fall in preferred locations. LCE also remains open to interesting opportunities, and should developers find locations that have not been anticipated but through the developer’s analysis offer benefits LCE will consider them without feeling locked into the existing expected locations.
Most of the resources in the LCE’s PCPs are not expected to require transmission upgrades beyond the standard interconnection process. Those resources in LCE’s PCP that might require substantial transmission upgrades or new transmission lines are generally planned for much later in the plans and LCE expects that the developers will have determined that the transmission will be available before LCE enters into agreements with them. These resources in the LCE PCPs would include the OOS Wind and Offshore Wind. It is obvious that both offshore and out-of-state wind will require additional transmission, and this is a part of any discussion of these resources. In addition, in selecting these future resources for its portfolios LCE has considered transmission and chosen projects for which any transmission concerns should be minimized or already addressed. LCE’s choice of New Mexico Wind was made because of the existing plans for transmission to bring that energy to California. LCE’s choice of Wyoming Wind was made because of the existing plans for transmission to bring that energy to California; indeed, developers of that transmission have approached the CAISO about having that transmission become part of the CAISO.
26 IV. Action Plan
a. Proposed Procurement Activities and Potential Barriers LCE has a well-established procurement process that it uses and will continue to use to steadily achieve its PCP over the planning period. LCE’s procurement process includes the following key activities:
• Identification of planned resources by type, desired online date, and capacity. • Planning for procurement activities in consideration of LCE’s risk management policy; resource acquisition lead times including, where applicable, development timelines; staff capacity; and financial considerations.
• Design and administration of resource solicitations. For new resources, these typically take the form of periodic request for offers processes, while for existing resources, procurement activity is more frequent and routinized.
• Careful negotiation of contract terms to ensure positive outcomes for LCE customers with appropriate risk mitigation.
• Ongoing contract management, including where applicable, careful monitoring of development milestones.
• Ongoing contract management, including where applicable, careful monitoring of generator performance after a resource has achieved commercial operation date (“COD”). • Conduct and participate in joint CCA solicitation processes in order to expand procurement opportunities available to LCE.
LCE expects to use competitive solicitations to procure contracts for the new build resources contained in the PCP. Standard power purchase agreement terms are expected to range from ten to twenty years. i. The LSE should provide responses for each of the following resource categories:
Resources to meet IRP mandated procurement requirements, including D.21- 06-035 and D.23-02-040:
LCE does not have any procurement requirements under D.21-06-035, but has made significant progress in contracting with resources to meet its D.23-02-040 requirement. The recent D.26-02-057 procurement order obligates additional incremental procurement totaling 15 MW by 2032, of which 4 MW is long duration storage and/or clean firm generation. LCE is currently evaluating offers resulting from a recent joint solicitation, which it expects to yield contracts to help contribute to the new obligation.
i. Plans for resources that are currently non-candidate in CPUC’s IRPs not described above
Not applicable
ii. Other renewable and/or zero carbon resources not described above As previously mentioned, LCE’s PCPs are not set in stone. LCE continually monitors the renewable energy space through RFPs and discussions with developers, as well as monitoring various news reports, and regulatory proceedings. LCE is ready to modify its expected portfolio if new resources or specific opportunities arise. LCE has expressed openness to alternative potential emissions reduction 27 opportunities in its RFPs and has encouraged such offers from respondents. This has not resulted in any viable opportunities to date, but LCE will continue to pursue various approaches to explore the potential value of a wide range of options. LCE strives to be a nimble and adaptable energy buyer in order to offer its customers the lowest cost, high renewable content power. iii. Other energy storage not described above
LCE expects that except for the long-duration storage required under D.21-06-035, D.26-02-057 and future procurement orders, the storage it will acquire will mostly be from paired solar and storage resources and/or standalone storage resources that help balance LCE’s very high behind-the-meter solar penetration. LCE remains open to considering other possibilities, especially if new technologies arise that reduce the costs of storage or in situations where storage can help fulfill other needs, such as reducing the need for new transmission or distribution. LCE will continue to monitor developments in the energy storage markets and adjust its portfolio if advantageous opportunities arise. iv. Other demand response not described above
LCE has already contracted for a modest amount of demand response resources. LCE remains open to other opportunities should they arise, and consistent with the current maximum cumulative capacity (“MCC”) bucket requirements.
v. Other energy efficiency not described above
LCE does not currently have any energy efficiency investment plans but may consider these proposals in the future.
vi. Other distributed generation not described above
LCE does not currently have any distributed generation investment plans but may consider these proposals in the future.
vii. Transportation electrification, including any investments that correspond to different levels than what is included in Integrated Energy Policy Report (IEPR) LCE does not currently have any transportation electrification investment plans but may consider these proposals in the future.
viii. Building electrification, including any investments that correspond to different levels than what is included in Integrated Energy Policy Report (IEPR) LCE does not currently have any building electrification investment plans but may consider these proposals in the future.
28 ix. Potential Centralized Procurement, pursuant to AB-1373 x. Other
b. Disadvantaged Communities (DACs)
i. Joint CCA Disadvantaged community green tariff Program (DAC-GT)
Table 8: Targeted DAC-GT Program Capacity and Enrollment 2026
Program LE
Capacity targeted for procurement
(MW) 0.05
Estimated customer enrollment 22
On June 22, 2018, the California Public Utilities Commission (“Commission”) issued Decision (“D.”) 18- 06-027, Alternate Decision Adopting Alternatives to Promote Solar Distributed Generation in Disadvantaged Communities which provided capacity allocations to Community Choice Aggregators located in a DAC.
As approved by the Commission in Resolution E-5130 the City of Lancaster (collectively on behalf of their CCA program) elected to pool their capacity allocations to offer a Request for Offers (“RFO”) for projects to serve their DAC-GT customers.1 The City of Lancaster CCA DAC-GT program has a program capacity allocation of 0.05 MW.1 The DAC-GT program provides a 20% bill discount to low-income customers, defined as customers eligible for California Alternate Rates for Energy Program (“CARE”) or Family Electric Rate Assistance Program (“FERA”), located in Disadvantaged Communities (“DACs”), defined as the top 25% most impacted census tracts statewide using the CalEnviroScreen tool, along with other areas in the highest 5% of CalEnviroScreen’s Pollution Burden. 1 On September 1, 2023, LCE released a DAC-GT RFO for new projects to serve their program. After the closure of the RFO on September 15, 2023, LCE received one offer. LCE successfully negotiated a Power Purchase Agreement (“PPA”) for the Minneola Solar Project. LCE submitted the PPA to the Commission review via a Tier 2 Advice Letter on June 3, 2024 and the Energy Division approved the PPA on July 3, 2024.5
Construction commenced in 2025 with an original estimated COD on or before March 31, 2026. On October 24, 2025, Coast Energy informed LCE of changes on utility schedule that pushes project COD to Q3 2026. Coast Energy has been diligently working with Southern California Edison Company (“SCE”) to advance the project interconnection schedule. However, consideration of CAISO synchronization and commissioning, ongoing delays resulted from the County about the Building permit approval and mainly due to SCE’s workload, the Seller agreed with SCE to submit Material Modification Assessment (“MMA”) to update the Commercial Operation Date to June 15, 2026. SCE approved the MMA to update the project’s critical milestones on December 11, 2025. Based on this approved assessment and current utility workloads, the target COD has been moved from March 31, 2026, to June 15, 2026, with SCE PTO identified for July 20, 2026.
29 ii. Power Choice CARE – Distributed Microgrids Program Power Choice program facilitates the installation of solar plus battery storage to CCA customers through a PPA, which is administered/paid via the customer bill. The program is a partnership with Participate Energy, who finances and owns the systems and acts as program administrator, and Tesla, who provides the storage assets for the program. Additionally, the program partners with local solar installers in each participating City.
In October 2025, the program launched "Power Choice CARE" program, which offered a program participation rate at 50% discount from the standard residential Power Choice offering. Customers must be on a CARE/FERA rate and must meet the income eligibility thresholds to participate. The targeted marketing campaign reached more than 80,000 eligible households across CalChoice Member CCA territories. Eligible customers within LCE’s customer base include 443 FERA customers and 20,946 CARE customers.
Equitable Building Decarbonization Direct Installation Program
In 2026, LCE joined the Southern California Coalition, comprised of approximately 50 community-based organizations (CBOs) and Community Choice Aggregators (CCAs) to market the CEC funded program. Led by program administrator, Los Angeles County, this program provides building decarbonization upgrades for low-income and moderate-income households in under-resourced communities in Southern California including:
• Single-family homes
• Multi-family homes
• Manufactured/mobile homes
The SoCal Coalition received an award of $2.8M to install energy efficiency measures. Equity Is at the heart of the program, and Is designed to address:
• High utility costs
• Poor Indoor air quality
• Older, Inefficient housing
• Barriers due to language, socioeconomic status and digital access
The program will launch with "initial focus area" communities, identified by program administrator, Los Angeles County. The initial customer outreach will target CCA customers located within a designated DACGT, and customers must meet a moderate-to-low income threshold to participate.
c. LSEs’ Tribal Customers
There are no tribal customers currently being served by LCE. d. Procurement Products
LCE intends to utilize the following physical energy products in procurement activities associated with its PCP. Contracts are expected to be conducted bilaterally rather than via commodities exchanges.
30 Table 9: Procurement Products
Product Description
Physical energy, RPS qualifying Renewable energy qualified to meet California RPS
Physical energy, other carbon free Non-carbon emitting energy that does not meet California RPS; e.g., large hydro
Physical energy, CAISO energy Energy delivered to the CAISO grid from unspecified sources
Capacity, Net Qualifying Capacity Capacity qualified to meet California Resource Adequacy program standards
e. Commission Direction of Actions
Not applicable
V. Lessons Learned
LCE’s experience in this IRP cycle has reinforced several important considerations regarding the scale and urgency of clean energy procurement required to achieve California’s long-term emissions goals. As a CCA committed to delivering clean, affordable, and reliable energy to its customers, LCE recognizes that the path to meeting the electric sector’s 8 MMT by 2045 GHG benchmark demands sustained, large-scale procurement activity across the entire IRP planning horizon — not merely in the near term.
A central lesson from this planning cycle is the recognition that achieving compliance with state GHG emissions reduction requirements will necessitate substantial and continuous procurement of renewable energy, long-duration storage, clean firm power, and other zero-carbon resources through 2045. The scale of resource additions required — informed by the 2025-2026 Transmission Planning Process Portfolio and LCE’s own load growth projections — underscores that no single procurement wave will be sufficient. Rather, LSEs such as LCE must maintain active, ongoing procurement pipelines over the coming two decades to ensure that new clean resources come online in cadence with load growth, contract expirations, and the retirement of fossil-fueled generation. LCE encourages the Commission to structure future IRP cycles, procurement tracks, and associated guidance in a manner that supports and anticipates this long-duration procurement obligation.
LCE intends to be an active and engaged participant in procurement necessary to achieve these objectives. LCE’s governing board has affirmed procurement as a strategic priority, and LCE plans to pursue solicitations for renewable energy, energy storage, and other qualifying resources on a rolling basis consistent with its Preferred Conforming Portfolio and Action Plan. LCE recognizes that successful procurement at the scale required through 2045 will depend not only on its own diligence, but also on the Commission’s continued efforts to streamline procurement authorization processes, reduce regulatory barriers to contract execution, and provide adequate lead time for LSEs to compete effectively in competitive resource markets.
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Glossary of Terms
Alternative Portfolio: LSEs are permitted to submit “Alternative Portfolios” developed from scenarios using different assumptions from those used in the Preferred System Plan with updates. Any deviations from the “Conforming Portfolio” must be explained and justified.
Approve (Plan): the CPUC’s obligation to approve an LSE’s integrated resource plan derives from Public Utilities Code Section 454.52(b)(2) and the procurement planning process described in Public Utilities Code Section 454.5, in addition to the CPUC obligation to ensure safe and reliable service at just and reasonable rates under Public Utilities Code Section 451.
Balancing Authority Area (CAISO): the collection of generation, transmission, and loads within the metered boundaries of the Balancing Authority. The Balancing Authority maintains load-resource balance within this area.
Baseline resources: Those resources assumed to be fixed as a capacity expansion model input, as opposed to Candidate resources, which are selected by the model and are incremental to the Baseline.
Baseline resources are existing (already online) or owned or contracted to come online within the planning horizon. Existing resources with announced retirements are excluded from the Baseline for the applicable years. Being “contracted” refers to a resource holding signed contract/s with an LSE/s for much of its energy and capacity, as applicable, for a significant portion of its useful life. The contracts refer to those approved by the CPUC and/or the LSE’s governing board, as applicable. These criteria indicate the resource is relatively certain to come online. Baseline resources that are not online at the time of modeling may have a failure rate applied to their nameplate capacity to allow for the risk of them failing to come online.
Candidate resource: those resources, such as renewables, energy storage, natural gas generation, and demand response, available for selection in IRP capacity expansion modeling, incremental to the Baseline resources.
Capacity Expansion Model: a capacity expansion model is a computer model that simulates generation and transmission investment to meet forecasted electric load over many years, usually with the objective of minimizing the total cost of owning and operating the electrical system. Capacity expansion models can also be configured to only allow solutions that meet specific requirements, such as providing a minimum amount of capacity to ensure the reliability of the system or maintaining greenhouse gas emissions below an established level.
Certify (a Community Choice Aggregator Plan): Public Utilities Code 454.52(b)(3) requires the CPUC to certify the integrated resource plans of CCAs. “Certify” requires a formal act of the Commission to determine that the CCA’s Plan complies with the requirements of the statute and the process established via Public Utilities Code 454.51(a). In addition, the Commission must review the CCA Plans to determine any potential impacts on public utility bundled customers under Public Utilities Code Sections 451 and 454, among others.
Clean System Power (CSP) methodology: the methodology used to estimate GHG and criteria pollutant emissions associated with an LSE’s Portfolio based on how the LSE will expect to rely on system power on an hourly basis.
33 Community Choice Aggregator: a governmental entity formed by a city or county to procure electricity for its residents, businesses, and municipal facilities.
Conforming Portfolio: the LSE portfolio that conforms to IRP Planning Standards, the 2045 LSE-specific GHG Emissions Benchmark, use of the LSE’s assigned load forecast, use of inputs and assumptions matching those used in developing the Reference System Portfolio, as well as other IRP requirements including the filing of a complete Narrative Template, a Resource Data Template and Clean System Power Calculator.
Effective Load Carrying Capacity: a percentage that expresses how well a resource is able avoid loss-of- load events (considering availability and use limitations). The percentage is relative to a reference resource, for example a resource that is always available with no use limitations. It is calculated via probabilistic reliability modeling, and yields a single percentage value for a given resource or grouping of resources.
Effective Megawatts (MW): perfect capacity equivalent MW, such as the MW calculated by applying an ELCC % multiplier to nameplate MW.
Electric Service Provider: an entity that offers electric service to a retail or end-use customer, but which does not fall within the definition of an electrical corporation under Public Utilities Code Section 218.
Filing Entity: an entity required by statute to file an integrated resource plan with CPUC.
Future: a set of assumptions about future conditions, such as load or gas prices.
GHG Benchmark (or LSE-specific 2045 GHG Benchmark): the mass-based GHG emission planning targets calculated by staff for each LSE based on the methodology established by the California Air Resources Board and required for use in LSE Portfolio development in IRP.
GHG Planning Price: the systemwide marginal GHG abatement cost associated with achieving a specific electric sector GHG planning target.
Integrated Resources Planning Standards (Planning Standards): the set of CPUC IRP rules, guidelines, formulas and metrics that LSEs must include in their LSE Plans.
Integrated Resource Planning (IRP) process: integrated resource planning process; the repeating cycle through which integrated resource plans are prepared, submitted, and reviewed by the CPUC Long term: more than 5 years unless otherwise specified.
Load Serving Entity: an electrical corporation, electric service provider, community choice aggregator, or electric cooperative.
Load Serving Entity (LSE) Plan: an LSE’s integrated resource plan; the full set of documents and information submitted by an LSE to the CPUC as part of the IRP process.
Load Serving Entity (LSE) Portfolio: a set of supply- and/or demand-side resources with certain attributes that together serve the LSE’s assigned load over the IRP planning horizon.
Loss of Load Expectation (LOLE): a metric that quantifies the expected frequency of loss-of-load events per year. Loss-of-load is any instance where available generating capacity is insufficient to serve electric demand. If one or more instances of loss-of-load occurring within the same day regardless of duration 34 are counted as one loss-of-load event, then the LOLE metric can be compared to a reference point such as the industry probabilistic reliability standard of “one expected day in 10 years,” i.e. an LOLE of 0.1.
Maximum Import Capability: a California ISO metric that represents a quantity in MWs of imports determined by the CAISO to be simultaneously deliverable to the aggregate of load in the ISO’s Balancing Authority (BAA) Area and thus eligible for use in the Resource Adequacy process. The California ISO assess a MIC MW value for each intertie into the ISO’s BAA and allocated yearly to the LSEs. A LSE’s RA import showings are limited to its share of the MIC at each intertie.
Net Qualifying Capacity (NQC): Qualifying Capacity reduced, as applicable, based on: (1) testing and verification; (2) application of performance criteria; and (3) deliverability restrictions. The Net Qualifying Capacity determination shall be made by the California ISO pursuant to the provisions of this California ISO Tariff and the applicable Business Practice Manual.
Non-modeled costs: embedded fixed costs in today’s energy system (e.g., existing distribution revenue requirement, existing transmission revenue requirement, and energy efficiency program cost).
Nonstandard LSE Plan: type of integrated resource plan that an LSE may be eligible to file if it serves load outside the CAISO balancing authority area.
Optimization: an exercise undertaken in the CPUC’s Integrated Resource Planning (IRP) process using a capacity expansion model to identify a least-cost portfolio of electricity resources for meeting specific policy constraints, such as GHG reduction or RPS targets, while maintaining reliability given a set of assumptions about the future. Optimization in IRP considers resources assumed to be online over the planning horizon (baseline resources), some of which the model may choose not to retain, and additional resources (candidate resources) that the model is able to select to meet future grid needs.
Planned resource: any resource included in an LSE portfolio, whether already online or not, that is yet to be procured. Relating this to capacity expansion modeling terms, planned resources can be baseline resources (needing contract renewal, or currently owned/contracted by another LSE), candidate resources, or possibly resources that were not considered by the modeling, e.g., due to the passage of time between the modeling taking place and LSEs developing their plans. Planned resources can be specific (e.g., with a CAISO ID) or generic, with only the type, size and some geographic information identified.
Qualifying capacity: the maximum amount of Resource Adequacy Benefits a generating facility could provide before an assessment of its net qualifying capacity.
Preferred Conforming Portfolio: the conforming portfolio preferred by an LSE as the most suitable to its own needs; submitted to CPUC for review as one element of the LSE’s overall IRP plan.
Preferred System Plan: the Commission’s integrated resource plan composed of both the aggregation of LSE portfolios (i.e., Preferred System Portfolio) and the set of actions necessary to implement that portfolio (i.e., Preferred System Action Plan).
Preferred System Portfolio: the combined portfolios of individual LSEs within the CAISO, aggregated, reviewed and possibly modified by Commission staff as a proposal to the Commission, and adopted by the Commission as most responsive to statutory requirements per Pub. Util. Code 454.51; part of the Preferred System Plan.
Short term: 1 to 3 years (unless otherwise specified).
35 Staff: CPUC Energy Division staff (unless otherwise specified).
Standard LSE Plan: type of integrated resource plan that an LSE is required to file if it serves load within the CAISO balancing authority area (unless the LSE demonstrates exemption from the IRP process).
Transmission Planning Process (TPP): process conducted by the California Independent System Operator (CAISO) to identify potential transmission system limitations and areas that need reinforcements over 10- year and 15-year horizons.