December 16, 2025 Item #6
City Council
Item #6
RTC 25-1113: Adoption of a
CITY OF Resolution Amending Rate
Schedules for Electric
1852 Service for All Classes of
THE MISSION CIT Customers Effective
January 1, 2026
December 16, 2025
1 City of
Santa Clara
The Centerof Whats Pomible
Agenda
• Sales and Funding Background
• Outreach and Notices
• Proposed Rate Increase
• Impacts and Comparisons
• Cost Drivers/Responses
2 POST MEETING MATERIAL
1 December 16, 2025 Item #6
City of
Santa Clara
The Center of Wist: Possible
Retail Sales
• FY 2024/25 - $763 Million Retail Sales Customer Mix
Revenues Retail Sales
Residential
- Residential $44 million 5.8%
- Commercial $27 million Commercial
3.6%
- Industrial $689 million
Municipal
- Municipal $3 million Industrial 0.4%
90.2%
• Sales expected to double in the next 10
years
Benefits to having a large customer base
With projected load growth, 4% increase = $32M in CY2026 retail sales, with ~$3M from residential & small commercial customers (<10%) 3 City of
Santa Clara
Public Outreach
Date Tactic
June 10, 2025 Presented in proposed budget
November 3, 2025 and Notification to Schools and State Agencies December 1, 2025
November 3, 2025 Communications to Key Accounts, Commercial customer list November 12, 2025 X (Twitter), Facebook, Nextdoor, Website, Email News blasts to City/SVP subscribers
November 12, 2025 and Public Notices
December 10, 2025 San Jose Mercury News
: Santa Clara Weekly
December 3, 2025 City Hall News and Council Newsletters Ongoing : Social media monitoring
Directing questions to [email protected]
4 2
December 16, 2025 Item #6
City of
Santa Clara
Monthly Bill Comparisons
with Proposed 4% Increase
2026 Residential Customer Change
Low User (300 kWh) Average (410 kWh) High User (1,000 kWh) Current Rate $51.46 $71.01 $175.91
Proposed Rate $53.52 $73.85 $182.93
Increase $2.06 $2.84 $7.02
2026 Commercial/Industrial Customer Change
Large Commercial / Very Large Industrial 5 Largest Industrial Small Business Small Industrial Large Industrial
C1 CB-3 CB-6 CB-6
CB-1
(1,000 kWh) (2,000,000 kWh) (20,000,000 kWh) (43,000,000 kWh) (500,000 kWh)
Current Rate $264.16 $93,177 $349,213 $3.044,937 $6,200,997 Proposed Rate $274.71 $96,901 $363,146 $3,166,600 $6,448,790 Increase $10.55 $3,724 $13,933 $121,663 $247,793
5 City of
Santa Clara
The Cooler of Whore Possible
SVP Historical Rate Increases
Two rate increases in 2023:
12% 8% on Jan 1 & 5% on July 1
→ driven by the spike in 10%
10% antural gas price during Dee
2022 and Jan 2023
8%
8% 7% 7%
6% 5% 5% 5%
4%
4% 3% 3% 3%
%
2% ¡Ì…îİ
0% 0%
0%
105°
2026 Proposed
6 6
3 December 16, 2025 Item #6
City of
Santa Clara
The Center of Wigs Posible
Other Utilities Rate Actions
and Proposals
SMUD In June 2025, SMUD approved 3% rate increase for 2026 and 2027 for all residential and non-residential customers.
Palo Alto In June 2025, Palo Alto approved 5.1% overall increase - distribution rate increase: 11%, Supply cost increase: 1%, Effective date: July 1, 2025.
Alameda In April 2025, Alameda approved 4% rate increase effective July 1, 2025.
Roseville No rate increase planned for 2026, after 9% increase on 6/1/2024 and another 9% increase on 1/1/2025.
7 Average System Rate Comparison with Utilities in CA
lifornia Utilities (>10,000 Customer
024 Average Sustem Rates (S/kWI
Pacilk Gos & flectre Co. - 0 37703
San Diego Gas & Electric Co = 0.37005
0.29121
sor Valley Elaine Service
- 0,28324
Southern California (dison Co - 0.26464
1 0 25931
Hey Cults
City ol Colton (CA) 3024860
City of Posedena - (CA) 0.24283
Los Angeles Department of Water • 0.22613
City of Palo Alto - (CA) • 0.21241
Alame a Municas Pree! • 02222
coy oflee -ica • 0.19660
is care 21 0. 9267
Meiced wigation Diatrit • 0.18947
Cinde ani • 0 RASS
City of Burbank Water and Power 0.18401
imhonal tenpatha Sharki 20 18113
City of Redding - (CA) 1 0.17904
3017569
Modesto Irrigation District • 0.17416
The ROAN. ICA
City of Anatom (CA) • 0.16712
Тралено манний сті онт -06619
by AAA Casio • 0.15412 City of Santa Clara
Tarloh lareston Dietre 3014270
025000 1) 10000 015000
Based on Form EIA-861 - Annual Electric Power Industry Reporl, collects data from distribution utiities and power markelers of electricity.
City of
Santa Clara 8
4 December 16, 2025 Item #6
City of
Santa Clara
Thee Cererof What's Postlle
Rate Assistance Programs
• 25-40% discount on electric portion of bill for residents who qualify for:
- Financial Rate Assistance Program (FRAP) - current total, 787 participants • Under 80% of County Median Income
- Medical Rate Assistance Program (MRAP) - current total, 310 participants • High energy use medical device(s)
• Requires Doctor Certification
• Other Assistance Programs are also available
- Low-Income Energy Assistance Program (LIHEAP) - current total, 463 participants 9 City of
Santa Clara
The Conteruf Whats Possible
Need for Increase
• Increasing reserves in line with growth
projections and to deal with market fluctuations
and contingencies.
• Increasing cost of renewable energy
• Increasing equipment, material, labor, and
construction costs for required maintenance of
electric utility infrastructure and new projects.
• Continuing investment in security for substations
in anticipation of large events and for long-term
operational system reliability.
• Catastrophic failure of the DVR engine
10 10
5 December 16, 2025 Item #6
City of
Santa Clara
They Copter of What: Fossilsk:
Cash Reserves/SVP's AA- Bond Ratings
• Most important rating agency metrics to maintain AA- rating - Balanced budget and adequate reserves to weather future market fluctuation and contingencies
- Maintains existing reserves at or above the minimum target of approved ranges, and with the proposed rate increase:
• the Rate Stabilization Reserve is anticipated to be at the minimum target of 10% of sales revenue by June 30, 2026
• the Operation and Maintenance Reserve is anticipated to be above the target range of 90 - 180 days of operating expenses by June 30, 2026 11 City of
Santa Clara
The Center of Sluts Portilie
Next Steps
• Bills to start reflecting rate increase effective Jan. 1 SVP to return in Q2/Q3 with Cost-of-Service results that may result in proposing increase/decrease on rates for different customer classes
SVP Biannual update pushed to January and will cover regular update and:
- Tariffs
- PG&E/CAISO actions
12 12
6 December 16, 2025 Item #6
City of
Santa Clara
The Castersfied Possibe
Recommendation
• Staff recommends that Council adopt the Resolution
> Amending Rate Schedules for All Classes of Customers with a 4% increase effective January 1, 2026
13 13
City Council
CATA CLARA CADA Item #6
RTC 25-1113: Adoption of a
CITY OF Resolution Amending Rate
Schedules for Electric
1852 Service for All Classes of
THE MISSION CIT Customers Effective
January 1, 2026
December 16, 2025
14 7
December 16, 2025 Item #6
City of
Santa Clara
The Confer of Whits Possible
More slides
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City of
Santa Clara
The Centerof Whost Possilk
Increase to All Customers
• Cost increases triggering this rate increase proposal have been incurred on behalf of all classes of existing customers
• This approach is proposed for both policy and legal reasons • Under Proposition 26, a service rate is not a tax if it is imposed for a specific government service provided directly to a ratepayer • Therefore, it is legally required that the increased cost of service be spread equally among the various classes of ratepayers. 16 16
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