Cooperation Agreement Between Pacific Gas and Electric and the City of San José for Electric Infrastructure Development March 4, 2025
Presented by: Kip Harkness, Deputy City Manager
Erica Garaffo, Assistant to the City Manager (Lead Resilience Strategist)
OVERVIEW
2 Collaborative Framework: Establishes a partnership between the City and PG&E.
Infrastructure Development: Supports planning, financing, construction, and maintenance of needed new electric infrastructure.
Economic and Industry Growth: Enables business attraction and supports driving industries like data centers and advanced manufacturing.
Decarbonization Goals: Aligns with the City’s carbon neutrality objectives.
Driving Delivery: Defines milestones and processes to ensure progress and oversight.
BACKGROUND
3 Growing Demand
for Electric
Capacity:
Rapid industry growth in
data centers and
advanced
manufacturing.
Driven by increased
demand for artificial
intelligence.
City’s
Decarbonization
Goals:
Aligned with Climate
Smart San José
initiative.
Aims to reduce
greenhouse gas
emissions and transition
to 100% clean energy.
Infrastructure
Challenges:
North San José and
Downtown face capacity
limitations and
interconnection delays.
Challenges in balancing
growth with
sustainability targets.
Critical Need for
Reliable, Clean
Energy:
Essential for business
attraction, economic
development, and
innovation.
PG&E’s
Role:
As the grid operator,
PG&E is well-positioned
to collaborate on
infrastructure
development and
modernization
• Initial discussions on
municipal electric utility
feasibility.
• Evaluation of existing city
energy programs and
regulatory landscape.
• Lessons learned from past
efforts, including
Downtown West (2021).
• October 3, 2023: Council
adopted Municipal Code
changes and directed staff
to explore standing up a
municipal energy utility
and keep engaging with
IBEW/PG&E
• Partner engagement to
assess governance,
financial, and operational
structures.
• Refinement of key
questions: cost savings,
innovation, resilience, and
workforce.
• Public and stakeholder
outreach to assess
support and feasibility.
• Development of a
business case, staffing
model, and financing
approach for San Jose
Power.
• Honing PG&E Partnership
Agreement (alternative to
San José Power)
Exploring Municipal Electric Utility
TIMELINE: Progressing Coordination and
Collaboration with PG&E
Establishing recurring monthly meetings to coordinate:
• Emergency Response and Preparedness,
• Electrical Connection to Development/Permitting,
• Resilience and Innovation,
• PG&E Distribution Infrastructure,
• PG&E Load Forecasting/Future Planning
Coordinating with IBEW
• Development of Cooperation
Agreement (TODAY)
• Negotiating Implementation
Agreement for terms on
speed, certainty, and
accountability (NEXT)
Improving Emergency
Management response and
coordination, especially in
response to Power Safety
Shutoff and weather events
2021-2023 2023 2024 2025
5 Funding for a City team
to accelerate work and
improve coordination.
Workforce development
initiatives and a PG&E
demonstration facility
Process improvements to
speed delivery and
innovations in design and
delivery of infrastructure
Commitment to joint planning,
and exploring options for
financing, and development
of new electric infrastructure
The commitment to cooperate on negotiating a more detailed Implementation Agreement which will include greater detail on all issues above including an approach to joint planning, load forecasting, transmission and distribution capital projects and budget teams, funding of staff, workforce development, and design and process improvements
KEY PROVISIONS IN
THE COOPERATION
AGREEMENT
Commitment to define
milestones for
interconnection of large load
customers (e.g. data centers,
labs)
COLLABORATION WITH IBEW
City coordinating with IBEW on:
• Gathering feedback on the Cooperation and
Implementation Agreements
Energy Department engaging with IBEW on:
• Long term Power Purchase Agreement project
selection criteria.
• Potential building electrification workforce
development programs.
6 RECOMMENDATION
Adopt a resolution authorizing the City Manager or her
designee to:
(a) Negotiate and execute the non-binding Cooperation
Agreement between Pacific Gas and Electric
Company and the City of San José to support the
timely development of electric transmission and
distribution infrastructure necessary for economic
growth and decarbonization goals in North San
José and Downtown San José.
(b) Negotiate a binding Implementation Agreement
consistent with the Cooperation Agreement’s
objectives that the parties expect will be brought
before City Council in the spring of 2025.
7 Cooperation Agreement Between Pacific Gas and Electric and the City of San José or Electric Infrastructure Development March 4, 2025
Presented by: Kip Harkness, Deputy City Manager
Erica Garaffo, Assistant to the City Manager (Lead Resilience Strategist)