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Resolution No. _____
Resolution of The Council of The City of Palo Alto Authorizing the City Manager or Their Designee to Transact Electric Supplies to Meet the City’s Electrical Loads Under Electric Master Agreements, Under Specified Terms and Conditions During Calendar Years 2025 Through 2039, Inclusive
SECTION 1. The City Council finds, as follows:
A. By Resolution 9324 adopted in 2013, the City Council authorized the City Manager or their Designee to transact electric supplies to meet the City’s electrical loads under Electric Master Agreements with suppliers during a 15-year delivery period, between calendar years 2013 through 2027, under the following conditions; I. The maximum term of any transaction shall not exceed three years, commencing on the date of execution of the transaction; II. No transaction entered into shall extend beyond December 31, 2027; III. The maximum expenditure under any Master Agreement shall not exceed $50 million in the aggregate;
B. The Resolution also found that Council’s approval of an Energy Risk Management Policy, via Resolution 9272, provided for the oversight and controls necessary to manage risks inherent in transacting electric supply under the Master Agreements; the Risk Management Policy has since been updated, most recently in June 2024 via Resolution 10166.
C. Since the authorization provided in 2013 via Resolution 9324, staff has undertaken over 200 transactions totaling $131.9 million, of which $1.6 million is for delivery during or after January 2025;
D. In December 2016, via Resolution 9652, Council approved a standard form electric master agreement based on the year 2000 version of the Edison Electric Institute (EEI) Master Power Purchase and Sale Agreement. This standard form agreement has been made available to any wholesale utility supplier on the City’s website since that time; however, execution of, and delegation of authority to transact under, standard form master agreements with specific suppliers remains subject to Council approval before any transactions may be completed.
The Council of the City of Palo Alto does RESOLVE as follows:
SECTION 2. The Council once again authorizes the City Manager or their designee to execute one or more transactions under Council-approved Master Agreements with pre- approved suppliers to purchase and/or sell electricity supplies and related services to meet the City’s forecasted electricity load and regulatory requirements.
NOT YET APPROVED Attachment A
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SECTION 3. The authorization referenced in Section 2 is subject to the following requirements:
(a) the maximum expenditure under any Master Agreement shall not exceed $75 million in the aggregate and, with respect to outstanding transactions referred to in Section 1.C, the respective amounts shall be applied against the maximum expenditure established herein; and
(b) the maximum term of any transaction shall not exceed three years, commencing on the date of execution of the transaction. The sentence preceding notwithstanding, the City may enter into a transaction greater than three years, if the Council grants prior approval to such transaction.
SECTION 4. No Master Agreement and any related transaction entered into with any qualified supplier, executed by the City Manager or his designated representative and approved as to form by the City Attorney, under the authority of this ordinance shall extend beyond December 31, 2039.
SECTION 5. The suppliers that have Master Agreements with the City and authorized to transact are listed below, and the supplier list could be expanded to additional suppliers with future approval from the City Council.
a. BP Energy Company;
b. Cargill Power Markets, LLC;
c. Constellation Energy Generation, LLC;
d. Avangrid Renewables, LLC;
e. NextEra Energy Marketing, LLC;
f. PacifiCorp;
g. Powerex Corp;
h. Shell Energy North America (US), L.P.;
i. Silicon Valley Clean Energy Authority (SVCE); and
j. Turlock Irrigation District.
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NOT YET APPROVED Attachment A
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SECTION 6. The Council hereby finds that authorizing the City Manager or their designee to transact for electric supplies to meet the City’s electrical loads under electric Master Agreements does not constitute a project for the purposes of the California Environmental Quality Act, pursuant to California Public Resources Code Section 21065, and, therefore, no environmental assessment is required.
INTRODUCED:
PASSED:
AYES:
NOES:
ABSTENTIONS:
ABSENT:
ATTEST:
_____________________________ _____________________________ City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
_____________________________ ______________________________ Assistant City Attorney City Manager
______________________________
Director of Administrative
Services
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Director of Utilities