DATE: October 13, 2026
CATEGORY: Public Hearing
DEPT.: City Manager’s Office
TITLE: Energy Services Contract for Solar
Photovoltaic Systems and Battery Energy
Storage Project—Various Actions
RECOMMENDATION
Adopt a Resolution of the City Council of the City of Mountain View: (1) Awarding an Energy Services Contract to SolarNorcal, LLC, Doing Business as Excite Energy, for the Design, Installation, and Commissioning of Solar Photovoltaic (PV) Systems at Four City Facilities: the Mountain View Public Library, City Hall, the Mountain View Center for the Performing Arts, and Rengstorff Park Aquatics Center (“Project Sites”), Including Roof Replacement Work at the Mountain View Public Library and the Mountain View Center for the Performing Arts, and a Battery Energy Storage System (Battery Storage) at the Rengstorff Park Aquatics Center, For a Total Amount Not to Exceed $3,945,750; (2) Finding That the Project Satisfies the Cost-Effectiveness Requirements of California Government Code Section 4217.12 for Energy Service Contracts; (3) Approving a Midyear Capital Improvement Program (CIP) Project, City Facilities Solar PV and Battery Storage, for the Design and Installation of Solar PV Systems at the Project Sites, Including Roof Replacement Work at the Mountain View Public Library and the Mountain View Center for the Performing Arts, and Battery Storage at Rengstorff Park Aquatics Center (Collectively, “Project”); (4) Transferring and Appropriating $2,600,000 From the General Non-Operating Fund, $1,400,000 From the CIP Reserve Fund, and $1,000,000 From the Sustainability Project CIP (Project 20-99) to Fund the New CIP Project; and (5) Finding That the Project is Exempt From the California Environmental Quality Act (CEQA), to be read in title only, further reading waived (Attachment 1 to the Council report). (Five Votes Required)
BACKGROUND
Municipal Sustainability and Solar Energy
The City has incorporated solar energy into its municipal facilities as part of its ongoing sustainability efforts. Solar energy can reduce reliance on electricity from the utility grid, lower greenhouse gas emissions associated with City operations, and help manage long-term energy costs. Municipal facilities also provide an opportunity for the City to demonstrate the benefits of renewable energy investments and lead by example in the community.
Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
Solar photovoltaic (PV) systems are located at the California/Bryant Street parking garage, Shoreline Golf Pro Shop, Shoreline Maintenance Facility, Municipal Operations Center, Mountain View Senior Center, Mountain View Sports Pavilion, Whisman Sports Center, Rengstorff Park Aquatics Center, and Mountain View Community Center. The Mountain View Community Center solar PV system also includes a battery energy storage system (battery storage). The solar PV systems at the Mountain View Senior Center, Mountain View Sports Pavilion, and Whisman Sports Center were included in the Energy Services Contract approved by the City Council at a June 25, 2024 public hearing.
Inflation Reduction Act Funding Opportunity
The Inflation Reduction Act (IRA), enacted in 2022, established federal incentives to support investment in clean energy projects, such as solar PV installations. Through the IRA's Direct Pay provisions, eligible public agencies may receive payments comparable to the federal Investment Tax Credit (ITC) for qualifying clean energy projects. The City anticipates receiving approximately $1,527,418 in Direct Pay incentives for the recently completed solar projects at the Mountain View Senior Center, Mountain View Sports Pavilion, and Whisman Sports Center.
When the IRA was enacted in 2022, Direct Pay incentives for eligible solar PV and battery storage projects were expected to remain available through at least 2032, providing public agencies with a longer timeframe to plan and implement clean energy projects. However, federal legislation enacted in 2025 accelerated the phaseout of certain IRA clean energy incentives and shortened the eligibility period for qualifying solar projects. As a result, eligible solar PV projects now must be completed and placed into service by December 31, 2027, to qualify for Direct Pay incentives.
Battery storage projects remain eligible for Direct Pay incentives through December 31, 2032.
These changes have significantly reduced the time available for public agencies to develop and complete qualifying solar PV projects in order to receive Direct Pay incentives. The accelerated timeframe has created constraints for planning new solar installations at City facilities, resulting in careful consideration of the project delivery approaches needed to complete the project by the end of December 2027.
ANALYSIS
Proposed Solar PV and Battery Storage Systems
The proposed project (“Project”) would build on the City’s existing solar installations by adding solar PV systems at four sites: the Mountain View Public Library (Library), City Hall, the Mountain View Center for the Performing Arts (MVCPA), and additional solar PV capacity and battery storage at the Rengstorff Park Aquatics Center. The Project Sites were identified based on energy consumption, anticipated energy cost savings, available space, and technical feasibility. The Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
preliminary locations and configurations of the installations at the Project Sites are shown in Attachment 2. The final locations, layouts, configurations, and related design details may be refined during final design and engineering to optimize system performance and address sitespecific conditions while remaining consistent with the approved Project scope. The goals of the Project are to increase onsite renewable energy generation, reduce electricity costs, and advance the City's sustainability goals.
Rengstorff Park Aquatics Center
At the Rengstorff Park Aquatics Center, the Project includes solar carports within the existing parking areas as well as battery storage. The battery storage system at the Rengstorff Park Aquatics Center will store excess solar energy for use during periods of high electricity demand, when utility rates are typically highest. The Rengstorff Park Aquatics Center is well-suited for battery storage due to its all-electric operations and significant energy needs, including pool heating.
Preliminary review indicates that approximately 10 to 12 small, newly planted trees located in the middle parking island at the Rengstorff Park Aquatics Center may be affected by the proposed solar carport improvements and may require removal. Staff anticipates being able to replant these recently established trees. Planting will be in accordance with City requirements and the final Project design, including consideration of appropriate locations outside of the solar carport footprint. Minor tree trimming or pruning may also be necessary at other locations to support the functionality and performance of the solar PV system.
City Hall, MVCPA, and Library
The solar PV systems at City Hall, MVCPA, and the Library will consist of rooftop panels and will be designed to accommodate future battery storage, providing flexibility to add storage as operational needs evolve, technology advances, or additional funding becomes available.
The Project also includes roof replacement work at two of the facilities – MVCPA and the Library.
Preliminary assessments identified that portions of the existing roofing systems at these facilities may require replacement during the anticipated 20-year operating life of the rooftop solar PV systems. Completing roof replacement before solar installation will allow the City to coordinate the improvements efficiently, minimize future disruption to the facility and solar energy production, achieve utility savings, and avoid costs associated with removing and reinstalling solar equipment if roof work were to be required after installation.
Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
Project Delivery Approach
Energy Services Contractor Selection Process
The City issued a Request for Proposals (RFP) on February 13, 2026, seeking qualified firms to provide design-build services for solar PV systems at the four Project Sites. The RFP also requested that each system be designed to be battery-ready, allowing for future integration of battery storage, and invited optional proposals for immediate installation of battery storage if financially advantageous to the City. Proposals were due on April 3, 2026, and the City received six proposals.
Proposals were evaluated based on the firms' relevant experience, technical qualifications, project approach, ability to meet the Project schedule, cost, and acceptance of the City's contract terms. Following evaluation of the written proposals, the four highest-ranked firms were invited to interviews, and reference checks were completed as part of the final evaluation process.
Based on the results of the evaluation, staff recommends awarding the Energy Services Contract to Excite Energy. Their proposal demonstrated a strong understanding of the Project, a technically sound approach, and successful experience delivering comparable design-build solar energy projects for public agencies. Excite Energy’s proposal was among the lowest-cost proposals received and ranked highest overall based on the evaluation criteria and provided the best overall value to the City.
Key Aspects of Excite Energy’s Proposal
Excite Energy's proposal includes the design, installation, and commissioning of the solar PV systems, solar carports, battery storage, and roof replacement work. The total energy services contract is $3,945,750, including $1,234,814 for roof replacement at the Library and MVCPA. The roof replacement work will be performed by a subcontractor to Excite Energy and is included in the energy services contract because completing the work before installation of the rooftop solar PV systems will avoid future costs associated with removing and reinstalling the solar equipment.
In addition to the $3,945,750 energy services contract, the proposal includes an initial two-year operations and maintenance (O&M) term for the solar PV and battery storage systems at a cost not to exceed $50,750. O&M services include system monitoring, preventive and corrective maintenance, and warranty support. Staff anticipates procuring the O&M services through a separate contract in accordance with applicable City procurement policies and procedures. The City may extend the O&M agreement for additional one-year periods, subject to future evaluation of system performance, operational needs, and available funding.
Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
Financial Analysis
Table 1 summarizes the anticipated Energy Services Contract costs, as well as the estimated IRA Direct Pay incentive.
Table 1: Estimated Energy Services Contract Costs
Category Estimated
Amount
Energy Services Contract (including Solar PV Systems, Battery Storage, Roof Replacement Work, and Contingency) $3,945,750
Estimated IRA Direct Pay Incentive (30-40% of eligible project costs) ($920,190) Net Project Cost $3,025,560
The financial analysis considers the Energy Services Contract cost, estimated electricity cost savings, O&M costs, and anticipated IRA Direct Pay incentives. The Project is eligible for IRA Direct Pay incentives, and staff expects to receive the proceeds after the Project is completed and placed into service and applicable federal requirements have been satisfied. The City may evaluate applying the incentive proceeds to reimburse or replenish eligible funding sources used for the Project, subject to applicable City policies and budgetary requirements.
Figure 1 illustrates the projected 20-year net savings cumulative over time by Project Site, incorporating Excite Energy’s proposed system sizes and costs (and not including roof replacement costs), anticipated IRA Direct Pay incentives, and projected O&M expenses. City Hall and MVCPA are analyzed together and shown as the Civic Center because the two facilities are served by a single PG&E account and meter.
Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
Figure 1: 20-Year Cumulative Net Savings for Proposed Solar and Battery Systems by Project Site (3.7% utility rate escalation)
As shown in Figure 2, the proposed solar and battery systems are projected to generate approximately $5.7 million in cumulative net savings for all proposed sites over 20 years. These savings reflect the anticipated energy cost savings and IRA Direct Pay incentives after accounting for the costs of the solar and battery systems, not including costs associated with the planned roof replacement and associated O&M expenses.
The analysis assumes an annual utility electricity rate increase of 3.7%, based on the annual average PG&E rate increase identified in the California Public Utilities Commission’s analysis referenced by Energy Toolbase. This assumption is used to estimate future electricity costs and the resulting savings from the Project.
Given the significant increases in PG&E electricity rates in recent years, staff also evaluated a 5% annual utility rate increase as a sensitivity analysis. The 5% assumption is consistent with the rate escalation assumption permitted under the Energy Conservation Assistance Act loan program and is intended to illustrate the potential impact of higher future electricity rate growth.
Under the 5% assumption, projected cumulative net savings would increase to approximately $6.9 million over 20 years.
Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
The cumulative net savings including the planned roof replacement costs and other City-incurred Project costs is $4.5 million. The roof replacements at the Library and MVCPA are necessary capital improvements that are being completed in conjunction with the solar installations to avoid future costs associated with removing and reinstalling rooftop solar equipment. When the roof replacement costs are incorporated into the overall economic analysis, the Project continues to demonstrate positive lifecycle economic benefits, as shown in Figure 2 and Table 2, and in more detail in Attachment 3.
Figure 2: 20-Year Cumulative Net Savings for Proposed Solar and Battery Systems – Total Project (3.7% utility rate escalation)
The solar PV and battery storage systems are also projected to generate additional savings beyond the 20-year analysis period, with many modern solar PV systems operating for 30 years or longer. As shown in Table 2, over a 30-year period, cumulative net savings from the solar PV and battery storage systems are projected to range from approximately $10.4 million to $15.1 million, depending on the utility rate escalation assumption and whether planned roof replacement costs are included.
Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
Table 2: Cumulative Net Savings (in Millions)
Project Savings Scenario
20 Years 30 Years
3.7% utility rate
escalation
5% utility rate
escalation
3.7% utility rate
escalation
5% utility rate
escalation
Excluding Roof Replacement $5.7M $6.9M $11.6M $15.1M
Including Roof Replacement $4.5M $5.7M $10.4M $13.9M
Note: Values represent cumulative net savings and assume annual utility-rate escalation of 3.7% or 5.0%, as indicated.
Energy Conservation Contracting
Staff recommends delivering the project using the Energy Conservation Contracting process authorized by California Government Code Sections 4217.10 through 4217.19. This procurement method allows public agencies to contract with qualified energy services contractors based on overall project value, including technical qualifications, project approach, lifecycle costs, schedule, and anticipated energy savings, rather than solely on the lowest responsive bid. For this Project, the Energy Conservation Contracting process also supports timely implementation necessary to preserve eligibility for available IRA Direct Pay incentives.
Required Government Code Findings
Prior to approving an energy services contract under Government Code Section 4217, the City Council must determine that the contract is in the City's best interests and that the anticipated cost of energy provided under the contract is less than the anticipated cost of energy the City would otherwise purchase in the absence of the Project.1 These findings can be made because:
• The Project was competitively procured through the Energy Conservation Contracting process and represents the best overall value to the City; • Projected electricity cost savings exceed the cost of electricity that would otherwise be purchased from the utility;
• Anticipated IRA Direct Pay incentives further reduce the City's overall project cost; and 1 Government Code Section 4217 also requires findings before a public agency may enter into a ground lease that is necessarily related to the energy service contract. Here, the project does not involve a necessarily related facility ground lease.
Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
• The financial analysis demonstrates positive lifecycle economic benefits over the expected useful life of the Project, as summarized in Figure 1, 20-Year Cumulative Net Savings by Project Site, presented earlier in this report. The solar and battery components of the Project provide positive long-term savings. As mentioned above, although including planned roof replacement affects the timing and amount of cumulative savings, the Project continues to provide positive lifecycle economic benefits. A detailed 20-year cumulative net savings analysis, including the impact of planned roof replacement, is provided in Attachment 3.
Accordingly, staff recommends that the City Council make the findings required by Government Code Section 4217.12, as reflected in the attached resolution.
Environmental Clearance
In accordance with the requirements of the California Environmental Quality Act (CEQA), the solar PV systems component of the Project is statutorily exempt pursuant to Public Resources Code Section 21080.35 as an installation of a solar energy system on the roof of an existing building or at an existing parking lot. On a separate and independent basis, the solar PV systems and battery energy storage system components of the Project are exempt pursuant to Cal. Code Regs. tit. 14 (CEQA Guidelines) section 15301 (Class 1, Existing Facilities), as minor alterations of existing public structures or facilities involving negligible or no expansion of existing or former use. On another separate and independent basis, the solar PV systems are exempt pursuant to CEQA Guidelines section 15303 (Class 3, New Construction or Conversion of Small Structures), as it is a new small structure or conversion of existing small structures from one use to another where only minor modifications are made in the exterior of the structure. Further, the roof replacement work at the Library and MVCPA is categorically exempt pursuant to CEQA Guidelines Section 15302 (Class 2, Replacement or Reconstruction). The roof replacement work consists of the replacement of existing roofing systems with similar improvements at existing City facilities and does not involve expansion of existing uses.
The Project consists of the installation of Solar PV Systems at four existing City facilities—a battery storage system, and roof replacement work. The Project will involve improvements to existing City facilities and does not involve expansion of existing uses or result in significant environmental impacts. Accordingly, staff recommends that the City Council find the Project exempt from CEQA pursuant to the statutory and categorical exemptions identified above.
Project Schedule
If approved by the City Council, the Project will enter the design phase in 2026, with construction to begin early to mid-2027. The project schedule has been developed to prioritize completion of the solar PV systems, including roof replacement work, by December 31, 2027, preserving the Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
City's eligibility for IRA Direct Pay incentives while allowing for coordination of the battery storage system at the Rengstorff Park Aquatics Center at a later date.
FISCAL IMPACT
The total estimated cost of the Project is $5,000,000. This includes $3,945,750 for the Energy Services Contract with Excite Energy, $50,750 for the initial two-year O&M term, and approximately $1,003,500 for other Project costs, including professional services, project management, permitting and fees, construction inspections, City administration, and contingency. Staff anticipates executing a separate contract, in accordance with applicable City procurement policies and procedures, for the O&M services.
The Project is anticipated to qualify for approximately $920,190 in federal Inflation Reduction Act Direct Pay incentives, which would reduce the City’s net project cost to approximately $4.1 million. The Project is also expected to generate ongoing electricity cost savings over the useful life of the solar PV and battery storage systems.
Staff recommends establishing a new CIP project, City Facilities Solar PV and Battery Storage, and transferring and appropriating $2,600,000 from the General Non-Operating Fund, $1,400,000 from the CIP Reserve Fund, and $1,000,000 from the Sustainability Project CIP (Project 20-99), for a total appropriation of $5,000,000. Sufficient funds are available from these existing funding sources, and no new funding is required.
As the Project advances, staff will review certain City-incurred costs, including permitting, fees, and related project costs, and City administration costs, to determine whether they can be reduced or eliminated for this City project. Any resulting savings would reduce the Project's funding requirement only where the cost and associated funding are within the same fund.
The CIP appropriation request is summarized in Table 3.
Table 3: CIP Appropriation Request
Description Cost
Energy Services Contract $3,945,750
Operations and Maintenance Services (Initial Two-Year Term) $50,750 Professional services $217,560
Project management $237,083
Permitting, fees, and related project costs $65,000
Construction inspections $120,000
City administration $299,624
Contingency $64,233
Total CIP Appropriation Request $5,000,000
Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
LEVINE ACT
California Government Code Section 84308 (also known as the Levine Act) prohibits city officials from participating in any proceeding involving a “license, permit, or other entitlement for use” if the official has received a campaign contribution exceeding $500 from a party, participant, or agent of a party or participant within the last 12 months. The Levine Act is intended to prevent financial influence on decisions that affect specific, identifiable persons or participants. For more information see the Fair Political Practices Commission website: www.fppc.ca.gov/learn/pay-toplay-limits-and-prohibitions.html
Please see below for information about whether the recommended action for this agenda item is subject to or exempt from the Levine Act.
SUBJECT TO THE LEVINE ACT
☒ Contract or franchise agreement
CONCLUSION
The Project includes the design and construction of rooftop solar PV systems at City Hall, the MVCPA, and the Library; solar carports and battery storage at the Rengstorff Park Aquatics Center; and associated roof replacement work at MVCPA and the Library necessary to support the installation and expected useful life of the Rooftop Solar PV Systems. The Project will be funded through transfers and appropriations from the General Non-Operating Fund, CIP Reserve Fund, and Sustainability Project CIP to fund the Energy Services Contract, two years of operations and maintenance, and additional City-incurred Project costs.
The Project aligns with the City’s sustainability and climate action goals and is projected to generate $5.7 million in cumulative net utility cost savings over 20 years from the solar PV and battery storage, after accounting for associated project and O&M costs. The inclusion of planned roof replacement work affects the overall Project savings; however, the combined solar, battery, and roof replacement project continues to provide positive lifecycle economic benefits. Based on the anticipated energy cost savings, available project incentives, and lifecycle cost analysis, the Project is expected to provide long-term financial benefits to the City. The Project also satisfies the requirements of California Government Code Section 4217 for use of an energy conservation contract, as the anticipated cost of energy provided by the Project, including associated costs over the contract term, is expected to be less than the anticipated marginal cost of energy that would otherwise be consumed by the City.
Energy Services Contract for Solar Photovoltaic Systems and Battery Energy Storage Project—Various Actions
October 13, 2026
ALTERNATIVES
1. Do not adopt the resolution and defer the Project. This alternative would forego eligibility for currently available federal Inflation Reduction Act Direct Pay incentives and delay the anticipated energy savings and facility improvements.
2. Do not adopt the resolution and direct staff to pursue an alternative project delivery and/or funding approach, such as a traditional Public Works design-bid-build process or funding the Project through a future Capital Improvement Program process. This alternative would delay implementation and may affect Project costs, anticipated energy savings, and the City’s ability to maximize available federal incentives.
3. Modify the resolution to authorize a reduced project scope, such as limiting solar PV and/or battery storage improvements to select sites, or deferring certain improvements. This alternative would reduce the initial funding requirement but may also reduce anticipated energy savings, resiliency benefits, and available federal incentives.
4. Provide other direction.
PUBLIC NOTICING
Agenda posting and a notice of the public hearing was published in The Daily Journal on September 29, 2026 as required by Government Code Section 4217.
Prepared by:
Lauren Anderson
Sustainability Analyst II
Rebecca Lucky
Sustainability Manager
Approved by:
Kimbra McCarthy
City Manager
Attachments: 1. Resolution
2. Preliminary Locations for Solar PV and Battery Energy Storage Systems
3. Projected 20-Year Cumulative Net Savings