Gao, Beilei
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Sanford Krasner
Saturday, June 21, 2025 10:04 AM
cityclerk; Gao, Beilei; Hampton, Tyron; Cole, Rick; Jones, Justin; Lyon, Jason MSC 6/24/2025 Item 3 - Optimized Strategic Plan
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Hello members of the Municipal Services Committee,
I am writing to comment on the draft outline for the Optimized Strategic Plan to be presented at the MSC meeting on Tuesday, June 24, 2025.
Executive summary: Please direct PWP to construct an achievable optimized strategic plan, with a realistic cost estimate, and let that drive the rate study.
Regardless of which options should be included, I do not see how this outline becomes a plan. This is more of a "concept for a plan". It is a grab bag of items that might be included in a plan.
A plan should begin with a statement of the objectives for the plan. At JPL, we would consider these driving requirements. The driving requirement for this plan should be Resolution 9977 - 100% carbon-free electricity, on an hourly basis, by the end of 2030.
The plan should also include guiding assumptions and philosophy. Some guidance might be that the eventual costing will be equitable, with some definition of equity, and that reliability is a high priority. It might also include guidance such as the retention of Glenarm, but only in a backup mode. Stated assumptions may also include projected demand, projected weather models, and projected technology availability and maturation.
There must be a basis to believe that assumed technologies (hydrogen; renewable natural gas) will be available when needed. These are the basis to reassess these assumptions as time progresses.
The plan must include a set of SMART goals - Specific, Measurable, Achievable, Relevant, and Time-based. In other words, the plan must outline a set of activities to be completed, along with planned dates. I understood that plans are never perfect, and must be periodically re-evaluated. But a failure to plan is a plan to fail.
General Eisenhower said that "plans are nothing; planning is everything." The plan must also be cost-able - sufficiently detailed to allow some level of costing. Cost estimates are inevitably in error but they provide a reality check on whether the plan is achievable. A cost estimate without a plan is a fantasy.
The Optimized Strategic Plan should proceed in several phases, which have not been apparent so far. 1 1.) Define the baseline plan for comparison. PWP has cited cost deltas for the various scenarios, but has never defined the baseline they are compared to. What are the SMART items in the baseline plan? (Wire undergrounding? Vault upgrades? Battery installation? Etc.) What are the consumption projections? What power procurements are planned? What are the projections for rooftop solar (individual, commercial and city-owned)? What is the projected cost to implement the baseline plan? Are these already included in the city budget?
2.) Define the Optimized Strategic Plan. What changes will be made to the baseline plan? What new activities are planned? (Expanded battery storage? Grid enhancements? Solar incentives? Changes in permitting?) What are the projected metrics? (X amount of solar each year? GHG emissions each year?)
3.) Costing - define the costs associated with the OSP. What are the cost deltas between that and the baseline?
4.) Rate Study - how will these costs be allocated? (Fixed charges, volumetric charges, bonds, general fund, private investments for rooftop, etc. ?) What are the driving principles for cost allocation? (Equity? Low-income impacts? Etc.) I am not recommending a particular solution, but these must be addressed. It makes no sense to proceed with a rate study without understanding of the revenue needed to execute the plan.
This writeup implies a linear process through these phases. There will be iteration back and forth. But this provides a structure for that iteration.
Please direct PWP to construct a realistic optimized strategic plan, with a realistic cost estimate, and let that drive the rate study.
Thank you for your attention,
Sandy Krasner
Altadena
CCL, Pasadena 100
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