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Renewable Portfolio Standard
Annual Status Report for Calendar Year 2024
& Summary Report for Compliance Period 4
Background
Vernon Public Utilities (VPU) is responsible for implementing and enforcing a Renewable Portfolio Standard (RPS) that reflects the Legislature’s intent to encourage the use of renewable resources, while also considering the impact of the standard on rates, reliability, financial resources, and environmental goals.
As specified in the RPS Program and California Energy Commission (CEC) regulations, VPU is not required to procure a specific quantity of RPS-eligible resources in any individual year during Compliance Period 4 (CP4).
However, the total renewable procurement over the four-year period must be equal to or greater than the average derived from the following equation:
• (Approximately 35.75% of 2021 retail sales) +
• (Approximately 38.5% of 2022 retail sales) +
• (Approximately 41.25% of 2023 retail sales) +
• (Approximately 44.00% of 2024 retail sales)
This results in an average procurement target of approximately 40% for the entire compliance period. VPU successfully met this requirement for CP4.
On May 7, 2020, the CEC issued proposed regulations to implement changes to the RPS long-term contracting requirements for Publicly Owned Utilities (POUs) under the Clean Energy and Pollution Reduction Act (SB 350). SB 350 established a new requirement effective January 1, 2021, stating that at least 65% of the RPSeligible procurement must come from contracts with terms of 10 years or more.
All of VPU’s existing and future renewable energy projects qualify under the “Long-Term Procurement Requirements” as defined by the CEC.
Performance Summary
VPU has complied with the 44% RPS requirement by procuring eligible renewable generation to meet its retail sales for 2024. VPU met the specified RPS target for Compliance Period 4 (CP4) (January 1, 2021 – December 31, 2024) using eligible renewable resources. The primary resources consisted of Vernon’s long-term solar contracts. Short-term renewable energy purchases were delivered to VPU either in a single year or spread across multiple years within CP4.
Calendar Year 2024 marked the final year of CP4. VPU’s renewable obligations were fulfilled through a combination of long-term contracts and short-term purchases. VPU’s RPS requirement for CP4 was approximately 40%, and the total procured for the compliance period also reached approximately 40%. A summary of CP4 totals is provided below in Table 2.
Renewable Energy Procurement in Calendar Year 2024
Pursuant to VPU’s RPS Procurement Plan and Enforcement Program, action has been taken to acquire renewable energy resources to meet the RPS requirements. Below is a brief description of the renewable resources utilized to achieve compliance.
Sustainable Power Group (sPower) Antelope DSR Solar Project The Antelope DSR Solar Project, developed by Sustainable Power Group (sPower), was selected from numerous responses to the Southern California Public Power Authority’s (SCPPA) Request for Proposals (RFP) issued in 2014. In collaboration with other SCPPA members, VPU staff conducted a comprehensive review of the 2 | P a g e
submitted projects and determined that the Antelope DSR Project offered several superior characteristics, and a highly competitive pricing structure compared to other renewable projects considered at the time.
The final project pricing was the lowest among technologies providing on-peak energy profiles. Energy generated by the project qualifies as Portfolio Content Category 1, the most valuable and preferred class of renewable energy under SB X1-2.
The project is located in the City of Lancaster, Los Angeles County, and has been in full commercial operation since January 1, 2017. VPU holds a 25-megawatt (MW) entitlement, along with associated environmental attributes, under a 20-year power purchase agreement.
Astoria Phase II Solar Project
Astoria II LLC has entered into a long-term Power Purchase Agreement (PPA) with SCPPA to develop a solar photovoltaic facility with a net capacity of approximately 175 MW. This contractual arrangement is considered firm generation and is jointly shared with other SCPPA municipal utility partners. By collaborating with these partners, VPU gains the critical mass needed to participate in large-scale renewable energy projects. This joint strategy helps reduce construction, financing, and operational costs, enabling VPU to achieve economies of scale and secure more favorable financing terms.
The project, located in Kern County, began full commercial operation on December 31, 2016, with SCPPA taking delivery of 75 MW of the energy produced. VPU, along with five other SCPPA member utilities, is participating in the PPA to purchase energy from the facility over a 20-year term.
The Vernon City Council approved the PPA (through SCPPA) with Astoria II to supply renewable energy to the VPU. Under this agreement, VPU is entitled to:
• 20 MW of capacity from January 2017 through December 2021 • 30 MW of capacity from January 2022 through December 2036 Puente Hills Gas to Energy Project
The Puente Hills Landfill Gas-to-Energy Station was constructed by the Los Angeles County Sanitation District in the 1980s. Located in southeastern Los Angeles County, near VPU’s service area, the facility has been in full commercial operation since January 1987 and has maintained an average online availability of 95%. It produces approximately 46 MW of generating capacity.
The facility is a conventional Rankine Cycle steam power plant that uses landfill gas (LFG) as its primary fuel source. The LFG is combusted in boilers to produce superheated steam, which drives a steam turbine generator to produce electric power.
VPU, through a PPA with SCPPA, secured 10 MW of renewable energy from the Puente Hills facility beginning January 1, 2017, through December 31, 2030. In 2020, VPU received an average of just over 5 MW from this facility.
Desert Harvest II Solar Project
The Desert Harvest Solar Photovoltaic Facility was developed by EDF Renewable Development Group and is located in Riverside County. The facility has a net capacity of 150 MW.
VPU, in partnership with Anaheim Public Utilities and Burbank Water and Power, is participating in a PPA through SCPPA to purchase 70 MW of the facility's output. Under this agreement, VPU holds a 12 MW entitlement, along with the associated environmental attributes, for a 20-year term.
The facility achieved commercial operation on December 17, 2020. 3 | P a g e
Daggett Solar 2 + BESS Project
The Daggett Solar Power 2 Photovoltaic Facility, paired with battery storage, was developed by Clearway Renewables Development Group in San Bernardino County. VPU holds exclusive rights to 60 MW of solar energy and 30 MW of battery capacity.
In collaboration with another SCPPA municipal utility, the City of Cerritos, which has committed to the remaining 5 MW of solar and 3 MW of battery capacity, VPU participates in a PPA to acquire a total of 65 MW of solar and 33 MW of battery output.
This project represents VPU’s first venture into battery storage technology, allowing energy to be stored from the solar system or the grid during the day when prices are low and then discharged during peak evening hours when prices are higher.
VPU has secured a 60 MW entitlement along with associated environmental attributes under a 20-year agreement. The project achieved commercial operation on December 12, 2023.
Renewable Resource Contracts Under Negotiation
Griffith Solar + BESS Project
The Griffith Photovoltaic and Battery Storage Facility, to be developed by Griffith Solar, LLC in Mohave County, Arizona, will combine 50 MW of solar generation with 50 MW of battery storage. VPU holds exclusive rights to 25 MW of both solar and battery capacity.
In partnership with Burbank Water & Power, another SCPPA member holding a matching 25 MW share, VPU has entered into PPA negotiations to secure its portion of the solar and storage output.
This project represents VPU’s second battery storage initiative, enabling the city to store energy produced during low-cost daytime hours and discharge it during higher-cost evening peak periods.
VPU’s 25 MW entitlement, along with associated environmental attributes, will be secured under a 20-year agreement currently under negotiation. The facility’s commercial operation is expected to begin in summer 2028.
AYPA Hawkins Solar + BESS Project
The Aypa Hawkins Project is a photovoltaic and battery storage facility to be developed by Aypa Power Development, LLC in Kern County, California. The facility will integrate 150 MW of solar generation with 150 MW of battery storage. VPU has secured exclusive rights to 55 MW of both solar and storage capacity. The remaining 95 MW will be shared among three other SCPPA member agencies: Anaheim Public Utilities, Pasadena Water & Power, and Colton Electric Utility.
VPU is currently engaged in PPA negotiations to formalize its 55 MW share. This project represents Vernon’s third battery storage initiative. The 55 MW entitlement, along with all associated environmental attributes, will be secured under a 20-year agreement that is still being negotiated. Commercial operation is anticipated to begin in summer 2029.
However, staff is currently experiencing significant uncertainty with delays and cancellations of these above mentioned renewable projects due to interconnection and transmission issues, tariffs on solar panels and battery energy storage equipment, and the potential withdrawal of federal tax credits previously provided to renewable energy projects.
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Short Term Purchases
Short-term purchases for CP4 (2021-2024) were as follows:
PCC1 – 115,130 MW’s
PCC2 – 250,000 MW’s
PCC3 – 173,376 MW’s
The following tables provide an overall assessment of VPU renewable resources and RPS requirements for CY 2024 (Table 1) and CP4 January 1, 2021- December 31, 2024 Totals (Table 2).
Table 1: RPS Compliance Status Report for CY 2024
Retail Sales (MWh) 1,025,925
Renewables Requirement (%) 44%
Renewables Requirement (MWh) 451,407
RPS Resources
Antelope DSR (Solar) 57,797
Astoria II (Solar) 62,832
Desert Harvest (Solar) 28,160
Puente Hills (Landfill Gas) 35,567
Daggett (Solar) 181,182
Bucket 1 (PCC1) Short Term 66,179
Bucket 2 (PCC2) 0
Bucket 3 (PCC3) 19,331
Total Renewable Procured (MWh) 451,048
Total Renewable Procured (%) 44%
Calendar Year 2024
Renewable Portfolio Standard Compliance
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Table 2: RPS Compliance Period 4 Totals (January 1, 2021 – December 31, 2024) Summary of Procurement Plan to meet Future RPS Requirements VPU is committed to meeting all future procurement targets for renewable energy, subject to factors beyond its control. With increasing RPS mandates for POUs over the next decade, VPU recognizes the need to enhance and diversify its renewable energy portfolio. To address this, VPU plans to develop a balanced RPS strategy that incorporates solar PV, wind energy, and other renewable resources, based on projected energy demand, economic feasibility, and project availability. An Integrated Resource Plan has also been completed to help guide procurement decisions.
To comply with RPS mandates, VPU will preserve its existing renewable resources, carry over any excess procurement from one compliance period to the next, and pursue timely, cost-effective opportunities to expand its portfolio. This includes seeking short-term purchase options to diversify its energy mix, while protecting ratepayers from sharp price increases that could negatively impact economic stability and growth within the city.
In accordance with state regulations effective January 2017, at least 75% of RPS procurement used for compliance must qualify as Bucket 1 (Portfolio Content Category 1 or PCC1), which typically involves bundled energy from California-based renewable power plants. Additionally, beginning January 1, 2021, at least 65% of RPS procurement must come from contracts with a term of 10 years or more.
Given the limited availability of Bucket 1 resources and the typical development timeline of three to five years for new utility-scale renewable projects, VPU is working closely with SCPPA to access a broader range of Retail Sales (MWh) 4,364,943
Approximate CP Renewables Requirement (%) 40%
Approximate CP Renewables Requirement (MWh) 1,733,757
RPS Resources
Antelope DSR (Solar) 241,059
Astoria II (Solar) 298,659
Desert Harvest (Solar) 115,185
Puente Hills (Landfill Gas) 153,299
Daggett (Solar) 223,802
Bucket 1 (PCC1) Short Term 183,440
Bucket 2 (PCC2) 250,000
Bucket 3 (PCC3) 173,376
Banked Transfer (PCC1) 94,938
Total Renewable Procured (MWh) 1,733,758
Total Renewable Procured (%) 40%
Compliance Period 4 Totals (01/01/2021 – 12/31/2024)
Renewable Portfolio Standard Compliance
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renewable resources. Through SCPPA’s competitive procurement process, Vernon can take advantage of opportunities that might otherwise be inaccessible due to its smaller size.
VPU has secured multi-year contracts for solar and landfill gas power generation to meet the State of California’s RPS requirements, as outlined in SB 350 and SB 100. Since these resources became operational on January 1, 2017, the share of bundled renewable energy in VPU’s supply portfolio has significantly increased. This has enabled the City to meet the approximately 40% target for Compliance Period 4 and positions it well to achieve the approximately 52% target for Compliance Period 5 (CP5).
VPU is also actively collaborating with SCPPA to secure additional renewable capacity, including 80 MW of solar photovoltaic and 80 MW of battery storage. These initiatives support VPU’s long-term objective of reaching approximately 60% RPS by 2030, in alignment with SB 100.
The following table summarizes VPU’s procurement plans and activities for Compliance Periods 5 through 7, detailing the renewable energy purchases required to meet the goals of SB 350, SB 100, and SB 1020.
Table 3: RPS Compliance (January 1, 2025 – December 31, 2033) Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast 2025 2026 2027 2028 2029 2030 2031 2032 2033
A) Retail Sales (MWh) 1,022,309 1,130,213 1,349,764 1,447,045 1,673,358 1,854,138 1,387,412 1,387,412 1,387,412 Required Renewables % 46.67% 49.33% 52.00% 54.67% 57.33% 60.00% 63.00% 65.00% 68.00% Category 1 75% 75% 75% 75% 75% 75% 75% 75% 75%
Category 2 15% 15% 15% 15% 15% 15% 15% 15% 15%
Category 3 10% 10% 10% 10% 10% 10% 10% 10% 10%
Required Renewables (MWh)
Category 1 357,834 418,151 526,408 593,325 719,502 834,362 655,552 676,363 707,580 Category 2 71,567 83,630 105,282 118,665 143,900 166,872 131,110 135,273 141,516 Category 3 47,711 55,753 70,188 79,110 95,934 111,248 87,407 90,182 94,344 B) Renewables Requirement 477,112 557,534 701,877 791,100 959,336 1,112,483 874,069 901,818 943,440 Long Term Obligation 310,122 362,397 456,220 514,215 623,569 723,114 568,145 586,181 613,236 Category 1 (PCC1) Long Term 383,500 349,000 415,500 624,500 624,000 623,500 623,000 622,500 622,000 Category 1 (PCC1) Short Term 169,251 50,000 - - - - - - - Category 1 (PCC1) Total 552,751 399,000 415,500 624,500 624,000 623,500 623,000 622,500 622,000 Category 2 (PCC2) - 100,000 - 85,000 85,000 85,000 115,000 115,000 115,000 Category 3 (PCC3) 75,669 - - 75,000 75,000 75,000 75,000 75,000 VPU RPS Master
CP5 (2025-2027) CP6 (2028-2030) CP7 (2031-2033)