Municipal Services Committee
October 8, 2024

Pasadena Water and PowerAN ORDINANCE AMENDING PASADENA MUNICIPAL CODE CHAPTER 13.04 TO REMOVE DIRECT ACCESS PROVISIONS AND RELATED TARIFFS, AND AMENDING LONG-TERM CONTRACT PROVISIONSMunicipal Services CommitteeOctober 22, 2024Item #2 Pasadena Water and PowerRecommendation1) Find that the proposed actions are exempt from CEQA State CEQA Guidelines Section 15061(b)(3) (Common Sense Exemption); and2) Direct the City Attorney to prepare an ordinance and return within 60 days, amending the Pasadena Municipal Code (“PMC”) Chapter 13.04, the light and power rate ordinance to: >Remove Chapters 13.04.095 – Direct access service, 13.04.096 –Direct access transition charge, 13.04.097 – Direct access service charge; and>Amend PMC Chapter 13.04.075 – Long-term contracts, to remove equity adjustments and associated provisions. 2 Pasadena Water and PowerElectric Rate Study
3 Rate Ordinance ReviewRate Ordinance ReviewPolicyReviewPolicyReviewTools & DesignTools & DesignScenariosScenariosOutcomeOutcomeEUAPDirect Access ServiceLong-term ContractsReview Financial Policies Financial modelsRate DesignPresent & Select ScenariosAdopt Rates & Communicate to Customers You are here
Pasadena Water and PowerBackground•Created during a past era of deregulation>Added to PMC in the year 2000>Direct Access: Customers allowed to choose electricity supplier>Long-Term Contracts: Large customers can receive equity adjustments to promote high load factors•Currently no customers enrolled•Inconsistent with current regulation•Not aligned with industry best practices4 Pasadena Water and PowerDirect Access Service •Direct Access Service Chapters >Customers may purchase electricity directly from a third-party provider, instead of from a regulated electric utility, such as PWP>13.04.095 through 13.04.097: Direct Access Service, Transition Charge, Service Charge>Historically no PWP customers enrolled•Recommend to remove Direct Access Service options 5 Pasadena Water and PowerCurrent Long-Term Contracts•Long-Term Contract Chapter 13.04.075>Commercial Customers who meet the minimum load factor during contract term may enter into long-term contracts with PWP>Equity adjustment provided for long-term contract customers>Currently no contracts in place6 Pasadena Water and PowerLong-Term Contracts Changes
7 Current
• Medium and Large Commercial Secondary and Primary customers • Minimum of four to five-year contracts• Meet minimum criteria on load and load factors, >100 kW• Five or seven % equity adjustments Proposed
• Large Commercial Secondary and Primary customers • Minimum five-year contracts• Meet minimum criteria on load and load factors, peak demand of >10,000 kW• Terms negotiated on a case-by-case basis Pasadena Water and PowerRecommendation Summary
8 • Retain local control of power supply sources• No longer a regulatory requirement• Streamline PMCDirect Access Service •Flexible solution to encourage demand stability• Streamline PMC to customize solution for large customers•Adapt to cost of service changes made in other portions of the PMCLong-Term Contracts