October 20, 2026
Department
DATE: October 20, 2026
TO: Mayor Martinez and Members of the City Council
FROM: Daniel Chavarria, Director of Public Works
Darin Fitzpatrick, Assistant Deputy Director of Public
Works, Operations & Maintenance
Subject: Termination of PG&E Electric Vehicle Fleet Electrification Program Agreements for 3230 Macdonald Avenue and
2500 Barrett Avenue
FINANCIAL IMPACT: Termination of the two Pacific Gas and Electric Company EV Fleet Electrification Program projects is estimated to result in reimbursement to PG&E of approximately
$76,785.90 for project development, design, engineering, project management, and related costs already incurred.
These termination costs will be absorbed within the
existing Public Works General Fund budget (Account
String: 01231031-400293).
Preliminary staff estimates indicate that completing these remaining obligations could require several hundred
thousand dollars in additional City investment.
PREVIOUS COUNCIL
ACTION:
November 28, 2023
STATEMENT OF THE
ISSUE:
The City entered into two Pacific Gas and Electric
Company EV Fleet Electrification Program agreements
for sites at 3230 Macdonald Avenue and 2500 Barrett
Avenue. Subsequent review determined that completing
the City's required behind-the-meter infrastructure would require substantial additional investment for which
sufficient project funding has not been identified. Staff recommends terminating the two projects and
reimbursing PG&E for documented project costs incurred
to date.
AGENDA
REPORT
October 20, 2026
RECOMMENDED ACTION: ADOPT a resolution terminating the City's participation in the Pacific Gas and Electric Company Electric Vehicle
Fleet Electrification Program for PG&E Project No.
FLEET005109591 at 3230 Macdonald Avenue and
PG&E Project No. FLEET005111982 at 2500 Barrett
Avenue; AUTHORIZE payment of PG&E's documented
project development and termination costs in an amount
not-to-exceed $80,000 from the existing Public Works
General Fund budget; and AUTHORIZE the City
Manager or designee to execute any termination,
closeout, or related documents necessary to discontinue and close out the two projects – Public Works
Department – (Daniel Chavarria 510-620-5478/Darin
Fitzpatrick 510-231-3044).
DISCUSSION:
Original Program and City Council Authorization
In Fall 2022, City Transportation staff applied to the California Hybrid and ZeroEmission Truck and Bus Voucher Incentive Project (HVIP) to reduce the cost of replacing two gasoline-powered R-Transit vans with wheelchair-accessible electric vans. The vehicle purchase included two Level II Electric Vehicle (EV) chargers that were anticipated for installation at the City Corporation Yard EV Charging Hub. Staff subsequently determined that the existing electrical service at the Corporation Yard was not configured to support the anticipated growth of the City's electric fleet and charging demand.
As a result of the City's participation in HVIP, PG&E contacted the City regarding participation in its EV Fleet Electrification Program Make-Ready Incentive Option. Under the program, PG&E would fund and perform upgrades to utility-side electrical infrastructure necessary to support EV charging installations.
Transportation staff initially submitted five City locations for consideration:
1. 32nd Street Recreation Complex;
2. City Corporation Yard;
3. Barrett Avenue Lot at 25th Street;
4. Richmond Auditorium lot adjacent to Nevin Avenue; and
5. Marina parking lot at Macdonald Avenue.
On August 30, 2023, PG&E's Engineering and Design team met with Transportation and Public Works staff and visited the five proposed locations to evaluate the feasibility and design of the utility upgrades. On September 27, 2023, Transportation staff received notification from PG&E that the Recreation Complex location had been approved, while the remaining locations continued to be evaluated.
October 20, 2026
On November 28, 2023, the City Council authorized staff to execute letters of commitment and related contracts for individual sites approved for participation in PG&E's EV Fleet Electrification Program (Attachments 1 and 2). This broader authorization allowed staff to proceed as PG&E completed its evaluation and approval of each location without returning to the City Council separately for each site.
Program Responsibilities
The original City Council report described the program as a "To The Meter" utility upgrade. Under this structure, PG&E is responsible for designing, constructing, owning, and maintaining the electrical supply infrastructure from its transformer to the City's meter. The City, however, is responsible for designing, constructing, owning, operating, and maintaining the customer-owned electrical infrastructure from the meter to the EV chargers.
The original November 28, 2023, agenda report identified no direct cost associated with participation in the PG&E program itself. However, it also expressly identified the City's responsibility for the infrastructure downstream of the meter and stated that staff would return to City Council as the City transitioned its fleet and acquired supporting EV service equipment.
The program also contemplated a 10-year commitment to operate and maintain equipment and provide EV usage information, as well as the acquisition and deployment of qualifying electric fleet vehicles and charging equipment.
Executed Project Agreements
Following Council authorization, the City proceeded with two project agreements that remain relevant to this action.
For 3230 Macdonald Avenue, PG&E Project No. FLEET005109591, PG&E issued its program invitation dated September 27, 2023 (Attachment 3). The project contemplated five vehicles and five EV chargers. PG&E offered a customer-owned make-ready infrastructure incentive of up to $20,000 and a potential EV charger rebate of up to $75,000, subject to the program's eligibility requirements. The agreement was subsequently countersigned in December 2023.
For 2500 Barrett Avenue, PG&E Project No. FLEET005111982, PG&E issued its program invitation dated December 7, 2023 (Attachment 4). The project contemplated 20 vehicles and provided for a customer-owned make-ready infrastructure incentive of up to $80,000, subject to program requirements. The agreement was countersigned on December 13, 2023.
Both agreements state that once the agreements are executed, PG&E will begin incurring design and project development costs. Both also provide that if the City withdraws from the program before site activation, PG&E reserves the right to recover fees and costs incurred by PG&E and its subcontractors following execution, including design and site-walk costs.
October 20, 2026
Current Project Review and Funding Considerations
Public Works recently reviewed the status of the two projects, the City's contractual responsibilities, available funding, and the remaining work necessary to complete the installations.
Under the executed agreements, PG&E is responsible for the utility-owned infrastructure extending to the City's meter. The City remains responsible for designing, constructing, owning, operating, and maintaining all customer-owned infrastructure behind the meter necessary to connect the new electrical service to the City's EV charging equipment.
Although the PG&E improvements would provide substantial utility infrastructure at the two locations, the City's remaining obligations would require significant additional investment that was not funded as part of the original program authorization.
Preliminary estimates indicate that required improvements may include switchgear costing approximately $80,000 to $350,000 or more; design and engineering costing approximately $25,000 to $75,000 or more; and additional costs for electrical and civil construction, trenching, conduit, charging equipment, permitting, commissioning, networking, software, and related improvements. In total, completing the two projects could require several hundred thousand dollars in additional City investment.
The original November 28, 2023, staff report identified no direct cost for participation in the PG&E program itself but acknowledged that the City would remain responsible for infrastructure downstream of the meter and anticipated that staff would return to the City Council as the City's fleet transitioned and additional EV service equipment was acquired. Funding sufficient to complete the City's remaining obligations has not subsequently been identified.
The agreements also provide that PG&E may recover costs incurred after execution if the City withdraws before site activation. PG&E has identified $31,855.32 in costs associated with the 3230 Macdonald Avenue project and $44,930.58 associated with the 2500 Barrett Avenue project, for a combined estimated termination cost of $76,785.90 (Attachment 5).
Accordingly, the City now faces a choice between terminating the projects and reimbursing PG&E for costs already incurred or continuing the projects and committing substantially greater City resources to complete the required behind-the-meter infrastructure. While termination will result in an expenditure without completed charging facilities, proceeding solely to avoid the termination costs would require substantially greater expenditures for projects for which adequate funding has not been identified.
On August 27, 2026, Public Works recommended terminating the projects and paying the applicable PG&E costs. The Public Works Director subsequently confirmed that recommendation, and Finance confirmed that an amount not to exceed $80,000 can be absorbed within the existing Public Works General Fund budget.
October 20, 2026
Based on the current cost information, available funding, and remaining City obligations, staff recommends terminating the two PG&E EV Fleet Electrification Program projects, reimbursing PG&E for documented costs in an amount not to exceed $80,000, and closing out the City's obligations under the agreements.
Staff Recommendation
Based on information currently provided by PG&E, termination of the two projects would result in the following estimated costs:
Site Project Number Estimated Termination Cost
3230 Macdonald Avenue FLEET005109591 $31,855.32
2500 Barrett Avenue FLEET005111982 $44,930.58
Total $76,785.90
The approximately $76,786 represents costs already incurred by PG&E in reliance upon the City's executed project commitments. Terminating the projects does not avoid those incurred costs. Conversely, proceeding with the projects would avoid the immediate termination payment but would require the City to fund and complete its remaining behind-the-meter obligations.
City staff recognize that discontinuing the projects results in a financial loss to the City because the approximately $76,786 payment will not result in completed EV charging facilities. However, the relevant financial decision at this stage is whether to incur the termination costs now or commit substantially greater City resources to complete projects for which adequate funding has not been identified.
Based on the current project costs, available funding, and the City's remaining infrastructure obligations, City staff recommends that the City Council adopt a resolution terminating the City's participation in the two PG&E EV Fleet Electrification Program projects, authorize payment of PG&E's documented project development and termination costs in an amount not to exceed $80,000, and authorize the City Manager or designee to execute any documents necessary to discontinue and close out the projects (Attachment 6).
DOCUMENTS ATTACHED:
Attachment 1 – November 28, 2023 City Council Agenda Report – PG&E EV Fleet Electrification Program
Attachment 2 – November 28, 2023 Authorizing Resolution Attachment 3 – PG&E Project No. FLEET005109591 – 3230 Macdonald Avenue Agreement
Attachment 4 – PG&E Project No. FLEET005111982 – 2500 Barrett Avenue Agreement Attachment 5 – PG&E Project Cost/Termination Documentation Attachment 6 – Resolution
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