Mobility & Infrastructure
Committee Memorandum
TO: MOBILITY & INFRASTRUCTURE COMMITTEE DATE: JULY 13, 2023 FROM: PUBLIC UTILITIES DEPARTMENT WARDS: ALL
SUBJECT: STATUS UPDATE REPORT ON PUBLIC UTILITIES RENEWABLE ENERGY PROCUREMENT MANDATES AND ACTIVITIES ISSUE:
Receive a status update on the Public Utilities Electric Department’s renewable energy procurement mandates and recent activities.
RECOMMENDATION:
That the Mobility & Infrastructure Committee receive and file this status update report on the Public Utilities Electric Department’s renewable energy procurement mandates and recent activities.
LEGISLATIVE HISTORY:
In 2011, the California Legislature adopted SB X1-2, which officially created the first set of tiered Renewables Portfolio Standard (RPS) targets of 20% by 2013, 25% by 2016, and 33% by 2020. In 2015, the California Legislature adopted SB 350, which further increased the RPS goal to 50% by 2030.
In 2018, the California Legislature adopted SB 100, which maintained the target of 33% RPS by 2020 and set compliance period targets of 44% by 2024, 52% by 2027, and 60% by 2030. SB 100 is also known as “The 100 Percent Clean Energy Act of 2018” because it created the policy of planning to meet all the State’s retail electricity supply with a mix of RPS-eligible and zero-carbon resources by December 31, 2045.
In 2020, the Riverside City Council adopted the “Envision Riverside 2025 Strategic Plan.” This Plan, which includes Environmental Stewardship as a strategic priority, accelerated the goal of meeting all the City’s retail electricity supply with a mix of RPS-eligible and zero-carbon resources up by five years (to 2040) when compared to the State’s goal year of 2045.
BACKGROUND:
Riverside Public Utilities (RPU) provides high quality, reliable electric services to over 110,500 metered electric customers throughout the City of Riverside. RPU has a 1-in-2 peak summer load forecast (statistically expected to be reached once every 2 years) of approximately 600 MW and an annual retail load of approximately 2,150 GWh. RPU is committed to increasing its use of renewable resources and promoting sustainable living practices that help reduce environmental impacts within the City of Riverside and the State of California.
RPU has been incorporating renewable energy resources into its generation portfolio for over two decades. Since 2012, RPU has contracted for 12 new renewable energy resources. Of these, 11 are currently on-line and typically supply more than 950,000 MWh/year of renewable or carbon-free “green” energy to Riverside residents. More details concerning these 11 resources are shown in Table 1 below.
Table 1. New long-term renewable energy contracts executed by the City of Riverside since 2012.
Project Name
MW Capacity
Expected
MWh Energy
Expected COD
Generation Technology
PCC
Pre-
Existing Resource
CC Approval Date
WKN Wind
6 19,500
On-line
Wind
PCC-1
No
12/18/12
Columbia II
11 30,800
On-line
Solar PV
PCC-1
No
9/24/13
Cabazon
39 40,000
On-line
Wind
PCC-1
Yes
12/3/13
North Lake
20 47,000
On-line
Solar PV
PCC-1
No
10/9/12
CE-2016
20 147,200
On-line
Geothermal
PCC-1
Yes
5/14/13
CE-2019
20 147,200
On-line
CE-2020
46 338,400
On-line
Kingbird B
14 41,650
On-line
Solar PV
PCC-1
No
9/24/13
Tequesquite
7.3 15,000
On-line
Solar PV
PCC-1
No
3/4/14
Summer Solar
10 23,500
On-line
Solar PV
PCC-1
No
4/1/14
Big Sky
10 23,500
On-line
Solar PV
PCC-1
No
4/1/14
DSR 1
25 71,200
On-line
Solar PV
PCC-1
No
7/28/15
Coso-2022
10 83,000
On-line
Geothermal
PCC-1
Yes
1/05/21
Coso-2027
20 166,000
1/2027
DISCUSSION:
Recent Contracts (executed since 2019)
Riverside actively attempts to contract for cost-effective, new long-term renewable resources to meet or exceed all RPS mandates. Consistent with this objective, on November 9, 2020, and January 5, 2021, the Public Utilities Board and the City Council, respectively, approved a new 20-year long-term renewable energy Power Purchase Agreement (PPA) through the Southern California Public Power Association (SCPPA) for the partial output of baseload geothermal energy from Coso Geothermal Power Holdings, LLC. Riverside successfully began receiving about 10 MW of baseload energy from their China Lake, California geothermal facility in January 2022; these energy deliveries are scheduled to increase to about 30 MW in January 2027. Overall, this contract is expected to deliver about 83,000 MWh of renewable energy annually beginning in 2022, increasing to 249,000 MWh annually on/after 2027.
On November 25, 2019, and December 17, 2019, the Public Utilities Board and the City Council, respectively, approved a new 15-year long-term renewable energy PPA with Camino Solar LLC for a 44 MW solar PV facility coupled with an 11 MW / 44 MWh Battery Energy Storage System (BESS). This PV/BESS system was scheduled to begin commercial operation by April 2022 but contracting delays in 2020 caused project completion to shift out to May 2023. Then in April 2021, the developer of this project informed Riverside that the project could not be built for the contracted price. Although both parties attempted to renegotiate the contract in good faith, additional PV and lithium battery supply chain disruptions in the fall of 2021 ultimately rendered the proposed project untenable. Thus, on February 24, 2022, Riverside and Avangrid mutually agreed to terminate this PPA.
Future Contracts (currently under negotiation)
Staff is currently negotiating a new PPA with a major renewable energy developer for out-of-state wind energy. This wind energy, which will be dynamically scheduled into the California Independent System Operator (CAISO) grid, will qualify as a Portfolio Content Category 1 (PCC-1) renewable resource. Under the currently proposed PPA terms, this contract would provide an additional 369,000 MWh/year of long-term PCC-1 renewable wind energy into Riverside’s portfolio, allowing the City to comfortably exceed its 60% RPS by 2030 mandate four years early.
Additionally, RPU staff continue to actively search for additional short- and long-term, cost-effective PCC-1 resources to meet our future anticipated energy needs. Staff continue to actively participate in the annual SCPPA renewable energy RFP process, conduct bilateral discussions with potential project developers and support customer-based (i.e., local Distributed Generation) renewable energy projects. RPU is committed and has demonstrated over the past 20 years to identifying and procuring renewable energy contracts that are commercially viable, enhance and diversify the RPU resource portfolio, mitigate future regulatory risks, reduce the City’s carbon footprint, and optimize the utility’s renewable procurement content category requirements in the most cost-effective manner possible.
Current RPS Projections through 2030
The utility served 43.1% of its retail load using renewable energy in 2021 and 45.4% of its retail load using renewable energy in 2022. Note that Riverside’s 2021 Power Content Label can be found on the RPU website here:
https://riversideca.gov/utilities/residents/our-energy/power-resources Figure 1 below shows Riverside’s most recent RPS projections through 2030 for all the renewable energy resources that are currently under contract with the City. Riverside will remain above its safe-harbor RPS levels through 2024 using this current renewable resource mix but begins to fall below safe-harbor RPS levels on/after 2025.
Figure 2 below shows how Riverside’s current RPS projections through 2030 will change if the new out-of-state wind PPA is successfully executed and added into RPU’s portfolio. With this new resource added to our current renewable resource mix, Riverside will remain well above its safe-harbor RPS levels up to and beyond 2030 (and with sufficient excess renewable energy to cover the small 2025 deficit).
Figure 1. RPS projections through 2030 for RPU's current portfolio of renewable resources.
Figure 2. RPS projections through 2030, assuming the new out-of-state wind resource is added to RPU’s portfolio. 2023 Integrated Resource Planning Activities
Staff is currently working on the Utility’s 2023 Integrated Resource Plan (IRP). This IRP will include detailed generation portfolio modeling studies extending out through 2045, including studies of new renewable energy procurement strategies for completely decarbonizing RPU’s electric portfolio before the end of the next decade. Staff expects to bring this 2023 IRP to the Board of Public Utilities and City Council for approval by the end of this year.
STRATEGIC PLAN ALIGNMENT:
RPU’s Renewable Procurements directly contribute to Strategic Priority 4 - Environmental Stewardship and Goal 4.1 - Rapidly decrease Riverside’s carbon footprint by acting urgently to reach a zero carbon electric grid with the goal of reaching 100% zero-carbon electricity production by 2040 while continuing to ensure safe, reliable and affordable energy for all residents.
The item aligns with each of the five Cross Cutting Threads as follows:
Community Trust – RPU is committed to transparency and accountability in its energy portfolio and planning. RPU’s annual power source disclosure reports and power content label show RPU’s resource mix. RPU’s quinquennial Integrated Resource Plan (IRP) filings detail its long-term plan to meet future energy needs while balancing reliability, affordability, and environmental goals. These reports are adopted and approved in a public process by the Board of Public Utilities and City Council to ensure transparency and community trust.
Equity – RPU’s resource portfolio serves energy throughout the community. Through its procurement of renewable resources, RPU is committed to ensuring that every member of the community has equal access to clean and renewable energy.
Fiscal Responsibility – RPU is committed to fiscal responsibility principles in its energy procurements and compliance. All prospective resources undergo a complete economic evaluation to ensure their cost-effectiveness in RPU’s power resource portfolio and minimize impacts to the utility’s cost of service.
Innovation – Staff keep up to date on the changing regulations and requirements as it relates to the RPS along with study of new renewables technologies (as well as related enabling technologies, such as battery energy storage) as they become available. RPU evaluates the market viability and maturity of current and future renewable generation technologies (along with supporting technologies), incorporating them into its long-term planning where appropriate.
Sustainability & Resiliency – Renewable energy resource types are inherently sustainable, as they do not rely on unsustainable finite sources of fossil fuel or other inputs to reliably operate.
FISCAL IMPACT:
There is no fiscal impact associated with the receipt and filing of this report.
Prepared by: Todd M. Corbin, Utilities General Manager
Certified as to
availability of funds: Edward Enriquez, Assistant City Manager/Chief Financial Officer/City Treasurer
Approved by: Kris Martinez, Assistant City Manager
Approved as to form: Phaedra A. Norton, City Attorney
Attachment: Presentation
Update Report on RPU Renewable Energy Procurement ● Page 2