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Home My WebLink About2024-06-03 Utilities Advisory Commission Agenda PacketUTILITIES ADVISORY COMMISSION Special Meeting Monday, June 03, 2024 Community Meeting Room & Hybrid 6:00 PM Utilities Advisory Commission meetings will be held as “hybrid” meetings with the option to attend by teleconference/video conference or in person. To maximize public safety while still maintaining transparency and public access, members of the public can choose to participate from home or attend in person. Information on how the public may observe and participate in the meeting is located at the end of the agenda. Masks are strongly encouraged if attending in person. T h e m e e t i n g w i l l b e b r o a d c a s t o n C a b l e T V C h a n n e l 2 6 , l i v e o n YouTube https://www.youtube.com/c/cityofpaloalto, and streamed to Midpen Media Center https://midpenmedia.org. VIRTUAL PARTICIPATION CLICK HERE TO JOIN (https://cityofpaloalto.zoom.us/j/96691297246) Meeting ID: 966 9129 7246 Phone: 1(669)900‐6833 PUBLIC COMMENTS Public comments will be accepted both in person and via Zoom for up to three minutes or an amount of time determined by the Chair. All requests to speak will be taken until 5 minutes after the staff’s presentation. Written public comments can be submitted in advance to UACPublicMeetings@CityofPaloAlto.org and will be provided to the Council and available for inspection on the City’s website. Please clearly indicate which agenda item you are referencing in your subject line. PowerPoints, videos, or other media to be presented during public comment are accepted only by email to UACPublicMeetings@CityofPaloAlto.org at least 24 hours prior to the meeting. Once received, the Clerk will have them shared at public comment for the specified item. To uphold strong cybersecurity management practices, USB’s or other physical electronic storage devices are not accepted. Signs and symbolic materials less than 2 feet by 3 feet are permitted provided that: (1) sticks, posts, poles or similar/other type of handle objects are strictly prohibited; (2) the items do not create a facility, fire, or safety hazard; and (3) persons with such items remain seated when displaying them and must not raise the items above shoulder level, obstruct the view or passage of other attendees, or otherwise disturb the business of the meeting. TIME ESTIMATES Listed times are estimates only and are subject to change at any time, including while the meeting is in progress. The Commission reserves the right to use more or less time on any item, to change the order of items and/or to continue items to another meeting. Particular items may be heard before or after the time estimated on the agenda. This may occur in order to best manage the time at a meeting to adapt to the participation of the public, or for any other reason intended to facilitate the meeting. CALL TO ORDER 6:00 pm – 6:05 pm AGENDA CHANGES, ADDITIONS AND DELETIONS 6:05 pm – 6:10 pm The Chair or Board majority may modify the agenda order to improve meeting management. PUBLIC COMMENT 6:10 pm – 6:25 pm Members of the public may speak to any item NOT on the agenda. APPROVAL OF MINUTES 6:25 pm – 6:30 pm 1.Approval of the Minutes of the Utilities Advisory Commission Meeting Held on May 1, 2024 UTILITIES DIRECTOR REPORT 6:30 pm – 6:45 pm NEW BUSINESS (a 10 minute break will be imposed during this section) 2.City of Palo Alto Utilities Wildfire Mitigation Plan (WMP) Annual Update (ACTION 6:45 PM – 7:15 PM) Staff: Tomm Marshall 3.Staff Recommends that the Utilities Advisory Commission Recommend the City Council Adopt the 2024 Annual Water Shortage Assessment Report (ACTION 7:15 PM – 7:35 PM) Staff: Lisa Bilir 4.City of Palo Alto One Water Plan: Presentation of Initial Results (DISCUSSION 7:35 PM – 8:30 PM) Staff: Lisa Bilir COMMISSIONER COMMENTS AND REPORTS FROM MEETINGS/EVENTS FUTURE TOPICS FOR UPCOMMING MEETING July 3, 2024 ADJOURNMENT SUPPLEMENTAL INFORMATION The materials below are provided for informational purposes, not for action or discussion during UAC Meetings (Govt. Code Section 54954.2(a)(3)). INFORMATIONAL REPORTS 12‐Month Rolling Calendar Public Letter(s) to the UAC PUBLIC COMMENT INSTRUCTIONS Members of the Public may provide public comments to teleconference meetings via email, teleconference, or by phone. 1. W r i t t e n p u b l i c c o m m e n t s m a y b e s u b m i t t e d b y e m a i l t o UACPublicMeetings@cityofpaloalto.org. 2. Spoken public comments using a computer will be accepted through the teleconference meeting. To address the Council, click on the link below to access a Zoom‐ based meeting. Please read the following instructions carefully. You may download the Zoom client or connect to the meeting in‐ browser. If using your browser, make sure you are using a current, up‐to‐date browser: Chrome 30 , Firefox 27 , Microsoft Edge 12 , Safari 7 . Certain functionality may be disabled in older browsers including Internet Explorer. You may be asked to enter an email address and name. We request that you identify yourself by name as this will be visible online and will be used to notify you that it is your turn to speak. When you wish to speak on an Agenda Item, click on “raise hand.” The Clerk will activate and unmute speakers in turn. Speakers will be notified shortly before they are called to speak. When called, please limit your remarks to the time limit allotted. A timer will be shown on the computer to help keep track of your comments. 3. Spoken public comments using a smart phone will be accepted through the teleconference meeting. To address the Council, download the Zoom application onto your phone from the Apple App Store or Google Play Store and enter the Meeting ID below. Please follow the instructions B‐E above. 4. Spoken public comments using a phone use the telephone number listed below. When you wish to speak on an agenda item hit *9 on your phone so we know that you wish to speak. You will be asked to provide your first and last name before addressing the Council. You will be advised how long you have to speak. When called please limit your remarks to the agenda item and time limit allotted. CLICK HERE TO JOIN Meeting ID: 966 9129 7246 Phone:1‐669‐900‐6833 Americans with Disability Act (ADA) It is the policy of the City of Palo Alto to offer its public programs, services and meetings in a manner that is readily accessible to all. Persons with disabilities who require materials in an appropriate alternative format or who require auxiliary aids to access City meetings, programs, or services may contact the City’s ADA Coordinator at (650) 329‐2550 (voice) or by emailing ada@cityofpaloalto.org. Requests for assistance or accommodations must be submitted at least 24 hours in advance of the meeting, program, or service. 1 Regular Meeting June 03, 2024 Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org. UTILITIES ADVISORY COMMISSIONSpecial MeetingMonday, June 03, 2024Community Meeting Room & Hybrid6:00 PMUtilities Advisory Commission meetings will be held as “hybrid” meetings with the option toattend by teleconference/video conference or in person. To maximize public safety while stillmaintaining transparency and public access, members of the public can choose to participatefrom home or attend in person. Information on how the public may observe and participate in themeeting is located at the end of the agenda. Masks are strongly encouraged if attending inperson. T h e m e e t i n g w i l l b e b r o a d c a s t o n C a b l e T V C h a n n e l 2 6 , l i v e o nYouTube https://www.youtube.com/c/cityofpaloalto, and streamed to Midpen MediaCenter https://midpenmedia.org.VIRTUAL PARTICIPATION CLICK HERE TO JOIN (https://cityofpaloalto.zoom.us/j/96691297246)Meeting ID: 966 9129 7246 Phone: 1(669)900‐6833PUBLIC COMMENTSPublic comments will be accepted both in person and via Zoom for up to three minutes or anamount of time determined by the Chair. All requests to speak will be taken until 5 minutesafter the staff’s presentation. Written public comments can be submitted in advance toUACPublicMeetings@CityofPaloAlto.org and will be provided to the Council and available forinspection on the City’s website. Please clearly indicate which agenda item you are referencingin your subject line.PowerPoints, videos, or other media to be presented during public comment are accepted onlyby email to UACPublicMeetings@CityofPaloAlto.org at least 24 hours prior to the meeting. Oncereceived, the Clerk will have them shared at public comment for the specified item. To upholdstrong cybersecurity management practices, USB’s or other physical electronic storage devicesare not accepted.Signs and symbolic materials less than 2 feet by 3 feet are permitted provided that: (1) sticks,posts, poles or similar/other type of handle objects are strictly prohibited; (2) the items do notcreate a facility, fire, or safety hazard; and (3) persons with such items remain seated whendisplaying them and must not raise the items above shoulder level, obstruct the view orpassage of other attendees, or otherwise disturb the business of the meeting.TIME ESTIMATESListed times are estimates only and are subject to change at any time, including while the meeting is in progress. The Commission reserves the right to use more or less time on any item, to change the order of items and/or to continue items to another meeting. Particular items may be heard before or after the time estimated on the agenda. This may occur in order to best manage the time at a meeting to adapt to the participation of the public, or for any other reason intended to facilitate the meeting. CALL TO ORDER 6:00 pm – 6:05 pm AGENDA CHANGES, ADDITIONS AND DELETIONS 6:05 pm – 6:10 pm The Chair or Board majority may modify the agenda order to improve meeting management. PUBLIC COMMENT 6:10 pm – 6:25 pm Members of the public may speak to any item NOT on the agenda. APPROVAL OF MINUTES 6:25 pm – 6:30 pm 1.Approval of the Minutes of the Utilities Advisory Commission Meeting Held on May 1, 2024 UTILITIES DIRECTOR REPORT 6:30 pm – 6:45 pm NEW BUSINESS (a 10 minute break will be imposed during this section) 2.City of Palo Alto Utilities Wildfire Mitigation Plan (WMP) Annual Update (ACTION 6:45 PM – 7:15 PM) Staff: Tomm Marshall 3.Staff Recommends that the Utilities Advisory Commission Recommend the City Council Adopt the 2024 Annual Water Shortage Assessment Report (ACTION 7:15 PM – 7:35 PM) Staff: Lisa Bilir 4.City of Palo Alto One Water Plan: Presentation of Initial Results (DISCUSSION 7:35 PM – 8:30 PM) Staff: Lisa Bilir COMMISSIONER COMMENTS AND REPORTS FROM MEETINGS/EVENTS FUTURE TOPICS FOR UPCOMMING MEETING July 3, 2024 ADJOURNMENT SUPPLEMENTAL INFORMATION The materials below are provided for informational purposes, not for action or discussion during UAC Meetings (Govt. Code Section 54954.2(a)(3)). INFORMATIONAL REPORTS 12‐Month Rolling Calendar Public Letter(s) to the UAC PUBLIC COMMENT INSTRUCTIONS Members of the Public may provide public comments to teleconference meetings via email, teleconference, or by phone. 1. W r i t t e n p u b l i c c o m m e n t s m a y b e s u b m i t t e d b y e m a i l t o UACPublicMeetings@cityofpaloalto.org. 2. Spoken public comments using a computer will be accepted through the teleconference meeting. To address the Council, click on the link below to access a Zoom‐ based meeting. Please read the following instructions carefully. You may download the Zoom client or connect to the meeting in‐ browser. If using your browser, make sure you are using a current, up‐to‐date browser: Chrome 30 , Firefox 27 , Microsoft Edge 12 , Safari 7 . Certain functionality may be disabled in older browsers including Internet Explorer. You may be asked to enter an email address and name. We request that you identify yourself by name as this will be visible online and will be used to notify you that it is your turn to speak. When you wish to speak on an Agenda Item, click on “raise hand.” The Clerk will activate and unmute speakers in turn. Speakers will be notified shortly before they are called to speak. When called, please limit your remarks to the time limit allotted. A timer will be shown on the computer to help keep track of your comments. 3. Spoken public comments using a smart phone will be accepted through the teleconference meeting. To address the Council, download the Zoom application onto your phone from the Apple App Store or Google Play Store and enter the Meeting ID below. Please follow the instructions B‐E above. 4. Spoken public comments using a phone use the telephone number listed below. When you wish to speak on an agenda item hit *9 on your phone so we know that you wish to speak. You will be asked to provide your first and last name before addressing the Council. You will be advised how long you have to speak. When called please limit your remarks to the agenda item and time limit allotted. CLICK HERE TO JOIN Meeting ID: 966 9129 7246 Phone:1‐669‐900‐6833 Americans with Disability Act (ADA) It is the policy of the City of Palo Alto to offer its public programs, services and meetings in a manner that is readily accessible to all. Persons with disabilities who require materials in an appropriate alternative format or who require auxiliary aids to access City meetings, programs, or services may contact the City’s ADA Coordinator at (650) 329‐2550 (voice) or by emailing ada@cityofpaloalto.org. Requests for assistance or accommodations must be submitted at least 24 hours in advance of the meeting, program, or service. 2 Regular Meeting June 03, 2024 Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org. UTILITIES ADVISORY COMMISSIONSpecial MeetingMonday, June 03, 2024Community Meeting Room & Hybrid6:00 PMUtilities Advisory Commission meetings will be held as “hybrid” meetings with the option toattend by teleconference/video conference or in person. To maximize public safety while stillmaintaining transparency and public access, members of the public can choose to participatefrom home or attend in person. Information on how the public may observe and participate in themeeting is located at the end of the agenda. Masks are strongly encouraged if attending inperson. T h e m e e t i n g w i l l b e b r o a d c a s t o n C a b l e T V C h a n n e l 2 6 , l i v e o nYouTube https://www.youtube.com/c/cityofpaloalto, and streamed to Midpen MediaCenter https://midpenmedia.org.VIRTUAL PARTICIPATION CLICK HERE TO JOIN (https://cityofpaloalto.zoom.us/j/96691297246)Meeting ID: 966 9129 7246 Phone: 1(669)900‐6833PUBLIC COMMENTSPublic comments will be accepted both in person and via Zoom for up to three minutes or anamount of time determined by the Chair. All requests to speak will be taken until 5 minutesafter the staff’s presentation. Written public comments can be submitted in advance toUACPublicMeetings@CityofPaloAlto.org and will be provided to the Council and available forinspection on the City’s website. Please clearly indicate which agenda item you are referencingin your subject line.PowerPoints, videos, or other media to be presented during public comment are accepted onlyby email to UACPublicMeetings@CityofPaloAlto.org at least 24 hours prior to the meeting. Oncereceived, the Clerk will have them shared at public comment for the specified item. To upholdstrong cybersecurity management practices, USB’s or other physical electronic storage devicesare not accepted.Signs and symbolic materials less than 2 feet by 3 feet are permitted provided that: (1) sticks,posts, poles or similar/other type of handle objects are strictly prohibited; (2) the items do notcreate a facility, fire, or safety hazard; and (3) persons with such items remain seated whendisplaying them and must not raise the items above shoulder level, obstruct the view orpassage of other attendees, or otherwise disturb the business of the meeting.TIME ESTIMATESListed times are estimates only and are subject to change at any time, including while themeeting is in progress. The Commission reserves the right to use more or less time on any item,to change the order of items and/or to continue items to another meeting. Particular items maybe heard before or after the time estimated on the agenda. This may occur in order to bestmanage the time at a meeting to adapt to the participation of the public, or for any other reasonintended to facilitate the meeting.CALL TO ORDER 6:00 pm – 6:05 pmAGENDA CHANGES, ADDITIONS AND DELETIONS 6:05 pm – 6:10 pmThe Chair or Board majority may modify the agenda order to improve meeting management.PUBLIC COMMENT 6:10 pm – 6:25 pm Members of the public may speak to any item NOT on the agenda.APPROVAL OF MINUTES 6:25 pm – 6:30 pm1.Approval of the Minutes of the Utilities Advisory Commission Meeting Held on May 1,2024 UTILITIES DIRECTOR REPORT 6:30 pm – 6:45 pm NEW BUSINESS (a 10 minute break will be imposed during this section)2.City of Palo Alto Utilities Wildfire Mitigation Plan (WMP) Annual Update (ACTION 6:45PM – 7:15 PM) Staff: Tomm Marshall3.Staff Recommends that the Utilities Advisory Commission Recommend the City CouncilAdopt the 2024 Annual Water Shortage Assessment Report (ACTION 7:15 PM – 7:35PM) Staff: Lisa Bilir4.City of Palo Alto One Water Plan: Presentation of Initial Results (DISCUSSION 7:35 PM –8:30 PM) Staff: Lisa BilirCOMMISSIONER COMMENTS AND REPORTS FROM MEETINGS/EVENTSFUTURE TOPICS FOR UPCOMMING MEETING July 3, 2024ADJOURNMENTSUPPLEMENTAL INFORMATIONThe materials below are provided for informational purposes, not for action or discussion during UAC Meetings (Govt. CodeSection 54954.2(a)(3)). INFORMATIONAL REPORTS 12‐Month Rolling Calendar Public Letter(s) to the UAC PUBLIC COMMENT INSTRUCTIONS Members of the Public may provide public comments to teleconference meetings via email, teleconference, or by phone. 1. W r i t t e n p u b l i c c o m m e n t s m a y b e s u b m i t t e d b y e m a i l t o UACPublicMeetings@cityofpaloalto.org. 2. Spoken public comments using a computer will be accepted through the teleconference meeting. To address the Council, click on the link below to access a Zoom‐ based meeting. Please read the following instructions carefully. You may download the Zoom client or connect to the meeting in‐ browser. If using your browser, make sure you are using a current, up‐to‐date browser: Chrome 30 , Firefox 27 , Microsoft Edge 12 , Safari 7 . Certain functionality may be disabled in older browsers including Internet Explorer. You may be asked to enter an email address and name. We request that you identify yourself by name as this will be visible online and will be used to notify you that it is your turn to speak. When you wish to speak on an Agenda Item, click on “raise hand.” The Clerk will activate and unmute speakers in turn. Speakers will be notified shortly before they are called to speak. When called, please limit your remarks to the time limit allotted. A timer will be shown on the computer to help keep track of your comments. 3. Spoken public comments using a smart phone will be accepted through the teleconference meeting. To address the Council, download the Zoom application onto your phone from the Apple App Store or Google Play Store and enter the Meeting ID below. Please follow the instructions B‐E above. 4. Spoken public comments using a phone use the telephone number listed below. When you wish to speak on an agenda item hit *9 on your phone so we know that you wish to speak. You will be asked to provide your first and last name before addressing the Council. You will be advised how long you have to speak. When called please limit your remarks to the agenda item and time limit allotted. CLICK HERE TO JOIN Meeting ID: 966 9129 7246 Phone:1‐669‐900‐6833 Americans with Disability Act (ADA) It is the policy of the City of Palo Alto to offer its public programs, services and meetings in a manner that is readily accessible to all. Persons with disabilities who require materials in an appropriate alternative format or who require auxiliary aids to access City meetings, programs, or services may contact the City’s ADA Coordinator at (650) 329‐2550 (voice) or by emailing ada@cityofpaloalto.org. Requests for assistance or accommodations must be submitted at least 24 hours in advance of the meeting, program, or service. 3 Regular Meeting June 03, 2024 Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org. Item No. 1. Page 1 of 1 Utilities Advisory Commission Staff Report From: Dean Batchelor, Director Utilities Lead Department: Utilities Meeting Date: June 3, 2024 Staff Report: 2405-3026 TITLE Approval of the Minutes of the Utilities Advisory Commission Meeting Held on May 1, 2024 RECOMMENDATION Staff recommends that the UAC consider the following motion: Commissioner ______ moved to approve the draft minutes of the May 1, 2024 meeting as submitted/amended. Commissioner ______ seconded the motion. ATTACHMENTS Attachment A: 05-01-2024 DRAFT UAC Minutes AUTHOR/TITLE: Jenelle Kamian, Program Assistant I Item #1 Packet Pg. 4 Utilities Advisory Commission Minutes Approved on: Page 1 of 9 UTILITIES ADVISORY COMMISSION MEETING MINUTES OF MAY 1, 2024 REGULAR MEETING CALL TO ORDER Chair Scharff called the meeting of the Utilities Advisory Commission (UAC) to order at 6:00 p.m. Present: Chair Scharff, Vice Chair Mauter, Commissioners Croft, Forssell (joined at 6:05 p.m.), Metz and Phillips Absent: Commissioner Segal AGENDA CHANGES, ADDITIONS AND DELETIONS None PUBLIC COMMENT None APPROVAL OF MINUTES ITEM 1: ACTION: Approval of the Minutes of the Utilities Advisory Commission Meeting Held on April 3, 2024 Chair Scharff asked for a motion to approve the April 3, 2024 UAC draft meeting minutes. ACTION: Commissioner Metz moved to approve the draft minutes of the April 3, 2024 meeting as submitted. Commissioner Mauter seconded the motion. The motion carried 4-0 with Chair Scharff, Vice Chair Mauter, Commissioners Metz and Phillips voting yes. Commissioner Croft abstained. Commissioner Forssell absent. UTILITIES DIRECTOR REPORT Utilities Director Dean Batchelor delivered the Director's Report. Water Supply Update: SFPUC, Palo Alto’s water supplier, confirmed water supply is in a solid position this year. SFPUC increased rates by 8.8% to $5.67. This change resulted in a proposed CPAU water rate Item #1 Packet Pg. 5 Utilities Advisory Commission Minutes Approved on: Page 2 of 9 increase of 11%. Last week, staff met with Finance regarding the proposed rates. Finance recommended lowering the CPAU water rate increase to 9.5%; therefore, staff will use funds from the Rate Stabilization Account. The proposed rate increase will be in the Financial Plan presented to Council in June and in the Proposition 218 notices. Heat Pump Water Heater (HPWH) Program Update: As of March 7, the State’s TECH Clean HPWH incentives were fully reserved. On April 15, City Council adopted the HPWH program budget with new pricing. A new 65-gallon HPWH installed through the full-service program is $2300. The City will provide a credit up to $1000 for site preparation work such as plumbing for the condensate line. There is a City rebate up to $3500 for customers who use their own contractor for HPWH installation. As of April 25, 237 HPWHs were installed through the full-service program and 70 HPWHs were installed through the rebate program. Staff is in the process of selecting one or more vendors to implement an Emergency Water Heater Replacement Pilot Program. Facilities Managers Meeting: Last Tuesday, the Commercial team hosted a Facilities Managers Meeting at the Cabana Crown Plaza Hotel. There were 20 participants. Staff presented a case study on the HPWH installation at City Hall, electrification incentives, landscape rebates and AMI. The meeting culminated with a tour of the heat pump HVAC system installed at the hotel. Earth Day Event at Hewlett Packard: The City’s Sustainability and Key Account Program Managers participated in a tabling event for HP’s Earth Day Event to share information about the City’s energy efficiency and electrification programs along with available rebates. City staff and HP’s facility and sustainability staff explored potential partnerships and ways the City can support HP’s sustainability initiatives and educational endeavors. Commercial Energy Efficiency Webinar: Last Thursday, staff hosted its first Commercial Energy Efficiency Webinar. The discussion led by industry experts and engineers discussed strategies for making commercial buildings more energy-efficient, particularly through HVAC and lighting advancements. After the webinar, one attendee signed up for the Business Energy Advisor program and was interested in pursuing energy efficiency projects. With close to 60 RSVPs for this session and the success of this workshop, staff plans to put together other webinar opportunities for our commercial customers. EV Charger Program: The EV Charger Program has 15 sites in the permitting or installation phase. Most of these projects will be completed by the end of the year. More than 30 additional properties are in earlier project phases, including site assessment, bidding and vendor selection. EV Technical Assistance Program (EVTAP): The three-year extension with CLEAResult began April 16 to provide technical assistance to sites in the pipeline. The extension guarantees a minimum of 19 additional sites going live within the life of the contract. It takes at least two years on average to complete an EV charger project. Events: The Commercial team attended an Earth Month Celebration at Stanford Research Park and a Sustainability Fair at Hewlett Packard. Staff tabled at the Downtown Palo Alto Farmers Market to promote the HPWH Program. On April 13, staff hosted an in-person workshop entitled “Tips & Tricks for Successful Turf Conversion” attracting over 60 people. On April 21, staff from Utilities, Public Works, Community Services and the Office of Transportation hosted the City’s Earth Day Festival at Rinconada Library and had over 700 attendees. On April 23, Utilities staff participated in the Palo Alto High School Item #1 Packet Pg. 6 Utilities Advisory Commission Minutes Approved on: Page 3 of 9 Earth Day event. More than 30 students came to the Utilities table to play an interactive game and learn about heat pump water heaters, EVs and PV systems. The UAC will have tables at the park for the May Fete Parade this weekend. The yearly MSC open house is on July 27 from 10 to 2. Jenelle Kamian sent an email to the UAC about rescheduling the next UAC meeting to Monday, June 3 in the Community Room. Commissioners will receive a poll regarding not having a UAC meeting this August. NEW BUSINESS ITEM 2: ACTION: Recommendation to Retain the Current WAPA Hydroelectricity Base Resource Contract Allocation From 2025-2030 Sr. Resource Planner Lena Perkins, PhD, delivered a slide presentation on the WAPA contract background, history and recommendation. Dr. Perkins addressed commissioners’ questions. The Valuation Estimate for WAPA Base Resource chart shows annual net value decreasing over time due to decreasing power market prices and increasing cost projections. The 20-year contract expires December 31, 2024 with five-year off-ramps. Western does not produce energy in the middle of the day when there is a surplus of solar and is paid for doing so. ACTION: Vice Chair Mauter moved to approve Staff’s recommendation that the UAC recommend that the City Council keep the City of Palo Alto’s full share of its allocated hydroelectric resource under the current hydroelectricity supply contract, the 2025 Base Resource Contract from Sierra Nevada Region of the Western Area Power Administration (2025 WAPA Contract), as approved by Council in February of 2021 (Staff Report #11679). Commissioner Phillips seconded the motion. The motion carried 6-0 with Chair Scharff, Vice Chair Mauter, Commissioners Croft, Forssell, Metz and Phillips voting yes. Commissioner Segal absent. The UAC took a break at 6:38 p.m. and resumed at 6:43 p.m. ITEM 3: DISCUSSION: Discussion of the Northern California Power Agency Issuing Bonds to Prepay for the Energy Received Under the 2025-2037 Geysers Power Purchase Agreement Sr. Resource Planner Shiva Swaminathan addressed the UAC. In early 2023, the UAC recommended and the Council approved Palo Alto’s participation in the 12-year PPA for Geysers Power Company. Staff anticipated receiving 5% of Palo Alto’s energy from this geothermal PPA starting in January 2025 and up to 10% of our needs by 2027 at an annual cost of approximately $7M ($6M for energy products and $1M for capacity products). The energy component is prepaid and was expected to yield 5% to 8% of energy cost savings at prevailing interest rate spreads, yielding a savings equivalent for Palo Alto of about $300,000 to $400,000 per year over 12 years. Staff seeks the UAC’s input on this deal structure. Staff will seek the Finance Committee’s input in June. If the consensus among NCPA member governing bodies is to proceed with the prepayment, staff will return to the UAC for formal approval to participate. Item #1 Packet Pg. 7 Utilities Advisory Commission Minutes Approved on: Page 4 of 9 PFM Financial Advisors Managing Director Michael Berwanger explained the energy prepayment structure. Northern California Power Agency (NCPA) CFO Monty Hanks stated the PPA participants were Palo Alto 10%, Santa Clara 70%, Lodi 10% and five other entities totaled the remaining 10%. Mr. Hanks stated that staff would seek input from the Finance Committee at their June 4 meeting. Approximately August 2024, NCPA will provide an informational update to the UAC, including the status of the CEC discussions, the result of Anaheim Electric’s prepay transaction, the status of bond financing documents, an estimated savings update, market conditions and review of the schedule. Higher interest rates generate greater savings. In fall or winter 2024, Geysers PPA participants will seek their respective City Council approvals and NCPA will seek approval from their commission to issue bonds. Mr. Swaminathan addressed commissioners’ questions. As the community expressed concerns with past structures and this is Palo Alto’s first prepay, staff was seeking the UAC’s input today. In August, staff will ask the UAC to act. There is minimal or no financial risk. There is a regulatory risk. An interest rate risk does not exist after the deal is done. Mr. Berwanger stated a custodian bank would bundle the separate payments and send one check to Geysers. Geysers is not prepaid for energy. Mr. Hanks remarked that Geysers would receive a check of $2.5M per month paid from funds in a custodian account funded by a combination of the participants paying a premium with the discount and the prepaid counterparty paying the difference. Mr. Berwanger explained the worst-case scenario was if the transaction terminates and participants no longer received expected savings; otherwise, this nonrecourse transaction does not financially harm participants. NCPA’s obligation is take and pay. The debt does not come back to NCPA or any of the project participants. There are contract provisions allowing the remarketing of energy to other municipal entities if there is too much energy coming off the project or if a project participant fails to pay or cannot take the energy. The first step is to look to the other participants within the project or other NCPA members to see if they can take the energy. As this is a nonrecourse transaction, there is no obligation on NCPA to repay the debt. It is a take-and- pay obligation, meaning that as you take energy you need to pay for it. Commissioner Phillips expressed his concern with the Bucket 1 risk from the CEC; however, he would recommend Council approval if Anaheim’s prepay transaction was successful and Palo Alto does not have any risk. Utilities Director Dean Batchelor commented that staff previously evaluated this option when interest rates were low but did not proceed because there was not much savings. In August, depending on interest rates, staff will evaluate the risks and savings. ACTION: None ITEM 4: ACTION: Utilities Advisory Commission Recommendation to Adopt a Resolution Amending the Gas Utility Long-term Plan (GULP) Objectives, Strategies and Implementation Plan; Amending the Gas Utility Reserves Management Practices, Amending the FY 2025 Gas Fund Budget, and Amending Rate Schedules G-1 (Residential Gas Service), G-2 (Residential Master-Metered and Commercial Gas Service), Item #1 Packet Pg. 8 Utilities Advisory Commission Minutes Approved on: Page 5 of 9 G-3 (Large Commercial Gas Service), and G-10 (Compressed Natural Gas Service). CEQA status: Not a project under Public Resources Code 15378(b)(5) and exempt under Public Resources Code 15273(a). Resource Management Acting Assistant Director Karla Dailey and Resource Planner Jason Huang delivered a slide presentation and proposed a strategy for mitigating a short-term natural gas price spike. Mr. Huang stated that Council approved a capped-price winter gas purchasing strategy for winter 2023- 2024 and a $0.15/therm maximum gas commodity charge impact to purchase the price caps. Staff purchased $2/therm price caps for half of Palo Alto’s expected load for December 2023, January 2024 and February 2024 at a total cost of about $1.5M. A $0.055/therm adder was included in the gas commodity charge from November 2023 through October 2024, representing an increase of about $1.80/month on a typical residential bill or a 2.8% increase, not including the underlying commodity price which is still based on the market index. Gas prices remained below $2/therm during December 2023, January 2024 and February 2024, so the City did not use the price caps it purchased. Council directed staff to evaluate alternatives. Staff recommended purchasing gas based on the monthly market price in addition to funding a reserve to offset future short-term price spikes. To fund the Gas Rate Stabilization Reserve, staff recommended an adder of $0.103/therm to the gas commodity charge, representing an estimated 5.2% increase on the median monthly residential customer bill. Staff estimated $2.8M would accrue each year up to a total of $11.3M by November 2028. The reserve would have funds to maintain the gas commodity charge at $2/therm for one month even if there were a price spike up to $5/therm for that month. Staff proposed reducing the maximum commodity charge to $3.50/therm in Fiscal Year 2026-2027, $2.75/therm after three years, and $2/therm after four years. Ms. Dailey stated that staff would address the Finance Committee on June 4 and the Council in August. Implementation of the strategy would start in October 2024 for gas year November 2024-October 2025. The Commission discussed alternatives as well as the importance of transitioning from gas to electricity, assisting low-income customers, an information campaign, and the possibility of using the Outage Management System to provide immediate notifications to customers of price spikes. Ms. Dailey addressed commissioners’ questions about neighboring communities. Long Beach and Vernon have gas utilities. PG&E passes the market price through every month. The CPUC requires PG&E to have storage, which in a normal year costs more money because storage is expensive. Usually, PG&E is around 6% higher than CPAU, although PG&E was lower than CPAU in January 2023 for an unknown reason but staff believed PG&E had some hedging in place. Ms. Dailey reminded the UAC it could not build a reserve for low-income customers because of Proposition 26; however, the General Fund could help. ProjectPLEDGE allows customers to donate money into a fund that provides one time bill payment assistance. Chair Scharff recommended that staff calculate the cost to protect low-income consumers who are unable to pay a one to three-month spike. Vice Chair Mauter wondered if CPAU saw a large increase in unpaid bills during the price spike. Utilities Strategic Manager Dave Yuan responded that there have been many unpaid bills accumulating since COVID but staff could do some research if the UAC wanted Item #1 Packet Pg. 9 Utilities Advisory Commission Minutes Approved on: Page 6 of 9 an answer. Mr. Yuan pointed out that CPAU’s Rate Assistance Program had about 500 participants in gas and 700 in electric. Staff can use the Rate Assistance Program to identify low-income customers. The Commission’s consensus was to assist low-income customers but not protect the broad populace against volatility in gas market prices over which Palo Alto has no control. Discussion ensued on the wording of the motion. ACTION: Vice Chair Mauter moved to recommend the City Council advise Staff to investigate options to protect low-income customers and provide additional price spike informational campaigns and to consider the following: 1. Maintain the maximum gas commodity charge of $4 per therm with the $0.06 adder for 3 years, and for Staff to return for review in two years, or 2. Raise the maximum of the gas commodity charge to $5 per therm with no adder. Commissioner Forssell seconded the motion. The motion carried 6-0 with Chair Scharff, Vice Chair Mauter, Commissioners Croft, Forssell, Metz and Phillips voting yes. Commissioner Segal absent. ITEM 5: ACTION: Staff Recommends That the Utilities Advisory Commission Recommend the City Council Adopt the Proposed Operating and Capital Budgets for the Utilities Department for the Fiscal Year 2025 Sr. Business Analyst Anna Vuong delivered a presentation. Next week, staff will seek the Finance Committee’s recommendations. In June, staff will seek Council approval. Projected FY 2025 rate increases in residential median bills: Electric Utility 9% increase, Gas Utility 9% increase, Wastewater 15% increase and Water Utility 9.5% increase for a total increase of about $33 in the median monthly bill. Ms. Vuong displayed slides on FY 2024 Department accomplishments, FY 2024 staffing report and Electric FY 2024 accomplishments. Electric FY 2025 initiatives included electrification-related business processes, efficiency programs and TOU rates; rebalance the electric supply portfolio; design and identify pilot area for residential whole-home electrification and gas decommissioning; enhance and accelerate HPWH installations. The Commission provided feedback on the presentation slides. Accomplishments do not need to be included in budgeting unless it is an ongoing project. Have a more detailed discussion on initiatives. When making budgeting decisions, what were the first two or three things below the line and why did staff decide not to include them? If you had an additional $5M, what would you do? Utilities Director Dean Batchelor responded that there was nothing below the line for Electric. When discussing the other funds, staff will mention any unbudgeted items. Commissioner Metz asked when the UAC would have more details on grid modernization, which was about 80% of the total budget. Utilities Strategic Business Manager Dave Yuan replied that the City was using existing vendors for the pilot project. After the pilot, the City will issue an IFP (invitation for bid) for the construction project and would have a list of all line items and costs from vendors or suppliers. Item #1 Packet Pg. 10 Utilities Advisory Commission Minutes Approved on: Page 7 of 9 Mr. Batchelor remarked that components of the large dollar amounts included building the hardware; costs for poles, wires, transformers and labor. Almost all the secondary needed replacement. Some of the feeder had to be replaced coming out of the substations. The substations needed upgrades. Oil breakers have to be replaced to harden the system. In response to Commissioner Croft’s question, Mr. Yuan explained why expenses exceeded revenues. The electric fund did not fully budget the bond financing. After the IFB and cost estimate, staff will perform a midyear (or later) revenue adjustment to account for the remaining bond finance. Ms. Vuong outlined the preliminary plan for the FY 2024-2030 grid modernization project. Purchase equipment and construction to upgrade all overhead areas in Years 1 through 4. Purchase equipment in Year 3 for construction to upgrade substation transformers in Years 5 and 6. Purchase equipment in Year 5 for construction to upgrade all underground areas in Years 6 and 7. As pilots are completed, staff will bring forth information to the UAC for review, comments and recommendations. The Fiber Fund FY 2025 initiatives included expanding the fiber backbone network into the foothills, conducting cost and benefit analysis study, as well as launching Palo Alto Fiber Internet in the pilot area. Mr. Yuan remarked that the fiber pilot would launch in CY 2025 Q1 or Q2. After CEQA approval in June, construction and material purchasing can begin. Gas initiatives for FY 2025 included Gas Main Replacement 24B, Cross-bore Phase IV, as well as conducting a study and identifying proof of concept area for downsizing the gas system. Ms. Vuong explained the Customer Connection Project. Customers fully pay for gas connections but the City pays for the portions of work needed to meet the customer’s needs in the public right of way or that benefit the City’s gas distribution system. Wastewater Fund FY 2025 initiatives included completing the Sewer Master Plan Study. Vice Chair Mauter was curious about the Sewer Master Plan Study objectives around changes in the magnitude of precipitation and if it’s tied into resiliency work the City might be doing on flooding. Ms. Vuong was not familiar with the goals or scope other than flow analysis of the system and recalibrating the sewer system hydraulic model. Mr. Batchelor remarked Utilities was working with Public Works to evaluate what needed to be done in the flooding areas. A full hydraulic model of the sewer system is updated periodically. Water Fund FY 2025 initiatives included Water Main Replacement Project 29, Water Seismic Project for Park and Dahl Reservoirs, as well as completion of alternative water resource approaches for the One Water Plan. Discussion ensued regarding backflow devices. Mr. Batchelor stated that about 80% of customers have their backflow device inspected; however, 20% were repeatedly not in compliance. Staff addressed this problem with Legal. CPAU was advised they did not have the right to shut off water. Those 20% are causing us to be out of compliance with the State for the last four or five years. Staff discussed charging $50 to $60 for the City to certify backflow devices and have parts for making repairs if needed. CPAU will shut off service if the backflow is nonfunctional. There are 7800 backflow devices in Palo Alto. Item #1 Packet Pg. 11 Utilities Advisory Commission Minutes Approved on: Page 8 of 9 ACTION: Commissioner Phillips moved to approve Staff recommendation the Utilities Advisory Commission recommend the City Council adopt the Proposed Operating and Capital Budgets for the Utilities Department for Fiscal Year 2025. Chair Scharff seconded the motion. The motion carried 6-0 with Chair Scharff, Vice Chair Mauter, Commissioners Croft, Forssell, Metz and Phillips voting yes. Commissioner Segal absent. COMMISSIONER COMMENTS and REPORTS from MEETINGS/EVENTS Council Liaison Vice Mayor Lauing reported the Finance Committee approved Utility’s rate proposals with one minor change. Last night, Council interviewed candidates for the UAC. One candidate was out of town, so Council will finalize their decision after meeting with the final candidate on Monday night. FUTURE TOPICS FOR UPCOMING MEETINGS Vice Chair Mauter asked what was the appropriate way of addressing separate meters for ADUs and/or bringing the topic onto the agenda for a future meeting. Utilities Director Dean Batchelor replied it was complicated because our Utilities rules and regulations do not allow two meters on one property. Staff had some discussions on engineering and Development Center permitting. Mr. Batchelor offered to provide an answer by the next UAC meeting or he could write up a short report and include the rules and regulations. Chair Scharff stated the UAC could recommend to Council that they change the rules and staff could provide their input. Commissioner Phillips noted the UAC spent very little time on electric power service to business but spent a lot of time on residential, which was approximately 20% of the load. He would appreciate more than just the segmentation of the businesses and he urged staff to schedule an informational item. In view of the court cases, Commissioner Metz wondered what were staff’s views on the electrification strategy and its impact on the Gas Utility. Mr. Batchelor responded that Utilities would devise a strategy. The Development Center may change the Reach Code. Five cities use the Source Energy Margin model, including San Jose, San Luis Obispo and Santa Cruz. Those Cities have high goals for appliance efficiency that gas appliances are unable to meet. The courts or residents have not challenged the model. In response to Council’s request for staff to come back to Council, staff is moving forward with a similar recommendation. If Council provides approval in June, staff will return to the UAC in July for a discussion. NEXT SCHEDULED MEETING: June 3, 2024 ADJOURNMENT Chair Scharff moved to adjourn. Vice Chair Mauter seconded the motion. The motion carried 6-0 with Chair Scharff, Vice Chair Mauter, Commissioners Croft, Forssell, Metz, and Phillips voting yes. Item #1 Packet Pg. 12 Utilities Advisory Commission Minutes Approved on: Page 9 of 9 Commissioner Segal absent. Meeting adjourned at 10:13 p.m. Item #1 Packet Pg. 13 Item No. 2. Page 1 of 3 Utilities Advisory Commission Staff Report From: Dean Batchelor, Director Utilities Lead Department: Utilities Meeting Date: June 3, 2024 Staff Report: 2404-2905 TITLE City of Palo Alto Utilities Wildfire Mitigation Plan (WMP) Annual Update. RECOMMENDATION Staff recommends the Utilities Advisory Commission accept and approve the updated 2024 Wildfire Mitigation Plan (WMP or Plan). EXECUTIVE SUMMARY The purpose of this report is to present to the UAC the updated annual Plan. Each year, electric utilities are required to update their Wildfire Mitigation Plans, present the Plan in a noticed public meeting, then submit the Plan annually by July 1 of to the California Wildfire Safety Advisory Board (WSAB).1 BACKGROUND California law requires all electric Utilities (Investor and Publicly-Owned Utilities) to annually update and submit a WMP to the WSAB, and to perform a comprehensive revision of the Plan at least once every three years.2 The Plan outlines specific ways in which the utility will prepare for and mitigate against possible wildfire ignition from electric equipment. The WMPs are limited in geographic scope to the areas previously identified as a high fire threat area by the California Public Utilities Commission’s State Fire map. For Palo Alto, this is the Foothills area. The City of Palo Alto Utilities Department (CPAU) submitted its initial Plan on January 21, 2020 (Staff Report ID 106703). As required by law, staff has updated the Plan in subsequent years 1 California Wildfire Safety Advisory Board https://energysafety.ca.gov/wp-content/uploads/2023/12//wsab-2024- wmp-pou-advisory-opinion.pdf 2 Public Utility Code 8387 https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?sectionNum=8387.&lawCode=PUC 3 Staff Report ID 10670 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city- manager-reports-cmrs/year-archive/2020/id-10670-mini-packet-01212020.pdf?t=53268.17 Item #2 Packet Pg. 14 Item No. 2. Page 2 of 3 2021 (Staff Report ID 121904), 2022 (Staff Report ID # 141755), and performed a ”comprehensive revision of the Plan” last year in 2023 (Staff Report ID #2301-0900).6 Palo Alto Utilities’ primary mitigation activity is undergrounding eleven miles of overhead electric lines in the Foothills area. This project involves installing substructure work, including boxes for electric and fiber lines; removing electric lines and fiber lines from overhead poles; and installing pad-mounted equipment where possible. This project consists of multiple phases and is expected to be complete in 2025. We have completed the substructure portions for Phase 1, Phase 2, and currently wrapping up Phase 3. We will then be moving onto Phase 4, which is the last phase of the project. Please see Appendix A within the 2024 Plan for a listing of mitigation activities and status. FISCAL/RESOURCE IMPACT Neither the UAC presentation nor the Wildfire Mitigation Plan itself have any immediate resource impacts besides the staff time to monitor, review, and update the Plan and the corresponding presentation. Ongoing and proposed activities listed in the Plan are and will be approved annually through the Capital and Operating Budget processes. STAKEHOLDER ENGAGEMENT The annual presentation of the Plan in a publicly noticed meeting provides an opportunity to hear and accept comments from the public, other local and state agencies, and interested parties. Additionally, all versions of the plan are posted on the Utilities Department website for public review. ENVIRONMENTAL REVIEW The UAC’s receipt of this WMP is not a project requiring California Environmental Quality Act review, because it is an administrative governmental activity which will not cause a direct or indirect physical change in the environment. To the extent proposed activities in the WMP require CEQA review, environmental review will be addressed when the City reviews the proposed project. ATTACHMENTS Attachment A: Updated 2024 Wildfire Mitigation Plan 4 Staff Report ID 12190 https://www.cityofpaloalto.org/files/assets/public/utilities/id-12190-item-2.pdf 5 Staff Report ID 14175 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/agendas- minutes/utilities-advisory-commission/archived-agenda-and-minutes/agendas-and-minutes-2022/06-08-2022/06- 08-2022-id-14175-item-3-wildfire.pdf 6 Update” and “comprehensive revision” are undefined in the statute. Palo Alto staff and other POUs interpret “update” to mean bringing the original plan up to date with limited to no significant changes, and “comprehensive revision” to mean an in-depth review of each plan element, with significant changes made as needed to the original plan. Staff report ID 2301-0900 https://cityofpaloalto.primegov.com/meetings/ItemWithTemplateType?id=1404&meetingTemplateType=2 Item #2 Packet Pg. 15 Item No. 2. Page 3 of 3 APPROVED By: Dean Batchelor, Director of Utilities Staff: Tomm Marshall, Assistant Director, Electric & Fiber Utilities Item #2 Packet Pg. 16 WILDFIRE MITIGATION PLAN JUNE 2024 Item #2 Packet Pg. 17 TABLE OF CONTENTS I. Utility overview and context……………………………………………………………………………………………….. 1 A. Context table……………………………………………………………………………………………………………… 1 B. Statutory cross-reference table………………………………………………………………………………….. 1 C. Process for WMP adoption…………………………………………………………………………………………. 2 D. Plan location on the website………………………………………………………………………………………. 2 II. Plan purpose and objectives……………………………………………………………………………………………….. 2 A. Purpose……………………………………………………………………………………………………………………… 2 B. Scope…………………………………………………………………………………………………………………………… 2 C. Plan objectives…………………………………………………………………………………………………………… 3 III. Roles and responsibilities…………………………………………………………………………………………………….. 5 A. City of Palo Alto Utilities Department…………………………………………………………………………. 5 B. Coordination with other departments……………………………………………………………………….. 6 C. Deenergization-related communication……………………………………………………………………… 6 IV. Electric-line ignited wildﬁre risk drivers with prevention and mitigation eﬀorts………………… 7 A. Primary risk drivers and speciﬁc mitigation eﬀorts……………………………………………………. 7 B. Primary risk driver and speciﬁc mitigation eﬀorts: Vegetation type, density, and management practices……………………………………………………………………………………………… 7 C. Other electric equipment-speciﬁc mitigation strategies……………………………………………… 8 D. Enterprise-wide Safety Risks………………………………………………………………………………………. 9 E. Current and prior activities………………………………………………………………………………………… 10 V. Monitoring the plan…………………………………………………………………………………………………………...... 10 A. Measuring Plan and inspection performance……………………………………………………………… 10 B. Performance and outcome metrics……………………………………………………………………………. 11 C. Applying previous Plan metrics to this Plan………………………………………………………………… 11 Appendix A: Wildﬁre Mitigation Activities………………………………………………………………………………….. 13 Item #2 Packet Pg. 18 1 I. UTILITY OVERVIEW AND CONTEXT A. Context table B. Statutory cross-reference table 1 CPUC ArcGIS map @ https://www.arcgis.com/home/webmap/viewer.html. 2 CAL Fire’s Santa Clara Unit 2023 Strategic Fire Plan @ https://cdnverify.osfm.ﬁre.ca.gov/media/aw4hpsgj/2023-santa-clara-unit-ﬁre-plan.pdf. City of Palo Alto Size in Square Miles 26 square miles Assets Distribution Number of Customers Served 29,849 residential and business customer accounts Customer Classes Residential and Small/Medium Business Location/Topography Urban Percent Territory in CPUC High Fire Threat Districts Tier 3 - 0% Tier 2 - 40% CAL FIRE FRAP Map Fire Threat Zones 40% High Approx. based on visual interpretation of CPUC ArcGIS map.1 Existing Grid Hardening Measures Undergrounding Impacted by another utility’s PSPS? Yes, as a transmission dependent utility, Palo Alto could be impacted by a PG&E PSPS. Mitigates impact of another utility’s PSPS? Yes Expects to initiate its own PSPS? Factors used to identify possible need for PSPS are based on weather forecast and field conditions. Refer to the PSPS Policy and Process. Prevailing wind directions & speeds by Please refer to Cal Fire’s Santa Clara Unit 2023 Strategic Fire Plan for information about wind regional wind conditions. 2 Code section Requirement Page 8387(b)(2)(A) Accounting of responsibilities 5 8387(b)(2)(B) Plan objectives 3 8387(b)(2)(C) Preventive strategies and programs to minimize risk 7 8387(b)(2)(D) Metrics used to evaluate Plan’s performance 11 8387(b)(2)(E) Current Plan informed by previous Plan’s metrics 11 8387(b)(2)(F) Protocols related to deenergizing and public safety impacts 8 8387(b)(2)(G) Customer notification around deenergizing 6 8387(b)(2)(H) Vegetation management 7 8387(b)(2)(I) Electrical infrastructure inspection plans 10 8387(b)(2)(J) A list of wildfire risks and drivers 7 8387(b)(2)(K) Area that is a particularly high wildfire threat 4 8387(b)(2)(L) Wildfire and safety risk methodology 7 8387(b)(2)(M) Restoring service after a wildfire 9 8387(b)(2)(N) Process to monitor Plan, identify any execution deficiencies, and audit inspection effectiveness 10 Item #2 Packet Pg. 19 2 C. Process for WMP adoption Palo Alto is unique among POUs because it has a Utilities Advisory Commission (UAC), an advisory Commission to the City Council. This commission is comprised of Council-appointed residents who meet monthly to provide advice to City Council and staﬀ on utilities-related matters, including the City’s Wildﬁre Mitigation Plan (Plan). A Brown Act body, the UAC publishes agendas in advance of each public meeting and provides opportunities for public comment at each meeting. Each year, Palo Alto staﬀ presents the Plan at a UAC meeting where staﬀ accept any public comments and receive feedback from Commissioners.3 Minutes and videos of past meetings are available on the City’s website. D. Plan location on the website Palo Alto’s Plan is the ﬁrst substantive item found on the Utilities Department safety webpage. Navigating to this page from the Department’s main page takes only two clicks and is intuitive. Users click on “Utilities Services and Safety,” then “Wildﬁre Mitigation.” 4 Because the City also has a Fire Department and an Oﬃce of Emergency Services that respond to ﬁres and other emergencies, this report brieﬂy notes how this wildﬁre Plan diﬀers from other City emergency response plans. II. PLAN PURPOSE AND OBJECTIVES A. Purpose This Plan is written in compliance with Public Utilities Code section 8387 and describes how the City of Palo Alto’s Utilities Department (CPAU) maintains and operates its electrical lines and equipment in a manner that minimizes the risk of wildﬁre posed by those lines and equipment. B. Scope The scope of this Plan is limited to providing information about mitigating the risk of wildﬁres from electric lines and equipment. It distinguishes between mitigating risks of possible electric line-ignited wildﬁres versus wildﬁres or wildﬁre suppression generally. The latter topics are in the scope and under the purview of trained ﬁre experts, such as the city’s Fire Department, and not within the expertise of utility engineers and technicians. The former is within the scope of CPAU responsibilities and is the subject of the state code section mandating this Plan; therefore, it is the sole focus of this Plan. 3 PUC 8783(b)(3) requires a POU to “present its wildﬁre mitigation plan in an appropriately noticed public meeting…[and] accept comments on its wildﬁre mitigation plan from the public….” While not the governing board of the utility, the UAC review satisﬁes the legal requirement of presenting the Plan at a noticed public meeting where comments from the public are accepted. 4 Utilities Department safety webpage @ https://www.cityofpaloalto.org/Departments/Utilities/Utilities- Services-Safety/Safety/Utilities-Wildﬁre-Safety. 8387(b)(3) Present Plan in an appropriately noticed public meeting 2 Item #2 Packet Pg. 20 3 Additionally, this Plan applies to the only area in the City of Palo Alto identified as a high fire threat area in the California Public Utilities Commission (CPUC) State Fire Map. As of 2023, the high fire threat area in Palo Alto includes all areas with the City limits west of Highway 280, referred to as the Foothills Area. (See below, Figure 1). This area is about eight square miles, is sparsely populated, and consists primarily of open space. Lastly and per the Board’s request of all POUs, this updated Plan deliberately omits general information the Board already understands in favor of specific information about the City’s territory, infrastructure, and mitigation projects. For example, the Board already knows that CPAU, and other POUs, meet all applicable GO 95 standards so it is not reiterated here. To avoid redundancy, the Plan omits appendices submitted in prior years, although there may be references to information from prior Plans. This is intended to acknowledge that both CPAU and the Board have limited resources to write and review Plans, the Board has already reviewed the appendices and offered guidance, and recycling past information is not as helpful as providing new information. C. Plan objectives The Plan’s primary objective is to guide CPAU staff in minimizing the probability that the City’s distribution system may be an original or contributing source for wildfire ignition. The City strives to ensure that its infrastructure is safe and resilient by taking proactive actions to maintain its equipment, refine the existing Public Safety Power Shutoff (PSPS) protocols as needed, and underground the electric lines in the only high fire threat area. A secondary objective is to improve the resiliency of the City’s distribution system and to measure the efficacy of the mitigation strategies. Item #2 Packet Pg. 21 4 Fig. 1: CPAU electric service area, showing high ﬁre threat “Foothills Area”. Item #2 Packet Pg. 22 5 III. ROLES AND RESPONSIBILITIES A. City of Palo Alto Utilities Department In Palo Alto, the City Council is the governing body of all City functions including the City’s utilities. As noted above, the UAC is a Brown Act body that provides advice on utilities- related matters. CPAU operates and maintains all the utilities in the City, including electric, water, gas, fiber, and wastewater. CPAU also employs communications staff to engage with the community and a Compliance Manager who, among other duties, ensures reports such as this Plan are completed timely and appropriately. CPAU’s electric and fiber staff noted above all play a role in mitigating wildfire risk from electric lines and equipment. Specifically, CPAU engineers produce safe and resilient designs, and oversee wildfire mitigation projects such as undergrounding electric lines. Item #2 Packet Pg. 23 6 Electric Operations staff inspect, repair, and maintain equipment while flagging any potential causes for concern. The CPAU Communications team produces safety communication material to the community, and the Compliance Manager ensures CPAU meets or exceeds laws and regulations.5 B. Coordination with other departments As one division of the City’s utilities department, CPAU’s Electric Utility staff works closely with other utilities divisions and other City departments. These include the Public Works Department and its Urban Forestry and Environmental Services Divisions, the Fire Department, the Office of Emergency Services, and the water utility Engineering and Operations team. Together, these departments and divisions proactively prepare for wildfires, act to mitigate climate and fire-related risks, maintain electric and water infrastructure, develop plans for deenergization events, ensure appropriate vegetation management, and lead Palo Alto’s robust climate action efforts. As these divisions, departments, and teams are under the umbrella of one City, there is a strong history of working together closely. C. Deenergization-related communication CPAU’s Communications staff is responsible for engaging the community about deenergization events. In doing so, and in deciding whether to deenergize lines, CPAU utilizes the “Utilities Wildfire Mitigation Response and Communications Procedure for Public Safety Power Shutoff.”6 This procedure includes proactively sending a specific recorded message to customers living in the Foothills area, and a more general but still targeted message to all electric customers. These messages are sent prior to deenergizing lines, to allow residents time to act, if necessary. Palo Alto also sends emails to Foothills residents, with specific information about conditions that may prompt deenergization, the anticipated dates and times of a shutoff, how to prepare, and where to find more information. During a deenergization event, CPAU continues to email and call customers. The calls and emails prior to and during any shutoffs are supplemented with frequent information posted on CPAU’s website and social media accounts. 5 To keep the public informed of CPAU’s capital improvement projects (CIPs), CPAU places CIP-related information @ https://www.cityofpaloalto.org/Departments/Utilities/Utilities-Services-Safety/Utilities- Projects/Foothill-Fire-Mitigation-Project. This information includes primary staﬀ contact information for the projects. 6 This document was previously provided to the Board as Attachment G in Palo Alto’s 2022 Plan. As a newer procedure that remains accurate, it has not been updated since that submittal. Item #2 Packet Pg. 24 7 IV. ELECTRIC-LINE IGNITED WILDFIRE RISK DRIVERS WITH PREVENTION AND MITIGATION EFFORTS A. Primary risk drivers and specific mitigation efforts Palo Alto recognizes that the Board is most interested in specific risks unique to each POU and its service territory, rather than general risks carried by all electric utilities. As such, and because Palo Alto is in the process of undergrounding the lines in its single high fire threat area, this Plan notes only the risk associated with electric equipment in the Foothills area. The more general risks Palo Alto regularly mitigates, but does not specifically address in this Plan, include: • Electric system operating, management, and construction practices outside the Foothills area • Weather including high winds outside the Foothills area • Extended drought With regard to weather monitoring, Palo Alto installed a weather station in the Foothills area, allowing staff direct, localized weather data. CPAU staff also monitor regional conditions, receive red flag warnings, and communicate with first-responder departments on any actions needed due to weather conditions. B. Primary risk drivers and specific mitigation efforts: Vegetation type, density, and management practices. Wildfire risks from electric lines and equipment include vegetation intruding into power lines, falling onto lines, or roots damaging undergrounded equipment. Mitigation efforts include ongoing physical inspections, ensuring the proper type of vegetation is placed at the correct distance from equipment, and adherence to the City’s Line Clearing Program and Tree Technical Manual for proper care of trees. Palo Alto is fortunate to have a dedicated Urban Forestry Division within the Public Works Department, staffed by trained and experienced urban foresters. Twice a year, these individuals evaluate every line- adjacent tree in the high fire threat area with a potential for contact with CPAU electric lines. Palo Alto utilizes a variety of vegetation treatment methods to reduce the risk of wildfire, including tree or branch removal, trimming, mowing, brush cutting, discing, and herbicide use. The Urban Forestry Department is planning a program to help remove potential fall- ins from trees outside of Palo Alto’s maintenance envelope of line-adjacent trees. In the future, to help staff track and manage flammable new growth, Palo Alto may utilize GIS and growth modeling. Currently, this work is performed manually with physical inspections. Item #2 Packet Pg. 25 8 In addition, for the Foothills area, Urban Forestry uses an enhanced vegetation management buffer as shown in the diagram below: This practice exceeds GO 95 minimum clearance standards for the line voltage. Specifically, a 4-foot radial clearance is the minimum required in high fire danger areas for lines between 750 volts and 300kv; Palo Alto maintains a minimum of 10 feet and a target of 12 feet radial clearance for all circuits in the Foothills area. C. Other electric equipment-specific mitigation strategies • Disabling certain reclosures. In the Foothills area, CPAU has two reclosers on the distribution line that automatically open when they sense a large amount of current flowing due to a fault. After a preset delay, they both can automatically reclose; however, as a method to minimize fire risk, the reclosing function is permanently disabled on both reclosures and at the circuit breaker of the substation serving this area. Restoring service requires manual reclosing, which occurs only after staff have physically inspected the lines, performed any needed repairs, and ensured that the outage cause is removed. While this practice means potentially longer outage times, it is an important risk mitigation activity. • Utilizing specific fuses. CPAU utilizes non-expulsion fuses in the high fire threat area. Specifically, CPAU utilizes Eaton’s Cooper PowerE series ELFE fuse, a full range, current-limiting dropout fuse with a self-contained design that eliminates noise and expulsive showers. If these fuses explode, any hot metal is contained within the fuse holder, preventing contact with vegetation. • Deenergizing, then reenergizing when prudent. CPAU considers deenergizing electric lines as a last resort, realizing that while the lack of power could be an Item #2 Packet Pg. 26 9 inconvenience for some customers, it could cause significant health and safety concerns for others. However, CPAU will utilize this option when necessary to minimize the risk of an electric-line ignited wildfire in the high fire threat area. Factors CPAU considers when determining whether to deenergize include: o The possible safety impacts to City customers o Any fire activity in the vicinity o Any evacuation orders and other information from emergency personnel o Information from local fire agencies, vegetation staff, and CPAU electric operators o Local and regional weather conditions including wind, humidity, precipitation and any red flag warnings o The state of vegetation in the area (i.e. very dry) • Restoring power after a wildfire or deenergization event. Lines will only be reenergized when (1) the risk has passed, (2) the lines are inspected, and (3) any needed repairs are complete. CPAU utilizes a Public Safety Power Shutoff (PSPS) policy and procedure when determining whether to deenergize lines because of a wildfire risk. The written protocol also includes customer notification procedures and reenergization information.7 In addition to customer notification from the Utilities Department, PSPS communication is also coordinated with Palo Alto’s Office of Emergency Services. The decision to institute a PSPS also includes working with CPAU’s water utility staff to determine if the City should pump water up to the reservoirs located in the Foothills area in advance of shutting off power, to ensure there is sufficient water and water pressure for any firefighting activities. • Coordination with PG&E. As a transmission-dependent utility, CPAU communicates with PG&E regarding their potential deenergization events that may impact the City’s service territory. • Studying device coordination strategies. Staff has engaged in protective device coordination studies to ensure that any fault is isolated quickly and any impact limited. Based on these studies, CPAU changed the fuse type and size, as noted above, on Foothills area distribution lines and changed relay settings for reclosers and a station circuit breaker. D. Enterprise-wide Safety Risks Palo Alto’s protocol for identifying and addressing enterprise-wide safety risks is a collaborative effort with various City departments. Together the goal is to prevent, protect from, mitigate, respond to, and recover from a broad range of potential hazards and threats. The City’s Office of Emergency Services (OES) leads that coordination with the goal of developing, maintaining, and sustaining a citywide, comprehensive, all hazard, risk-based emergency management program that engages the whole 7 The PSPS Policy and Process was included as Appendix F in the City’s 2022 update and has not been updated since then. Information on PSPS events can also be found on the website @ https://www.cityofpaloalto.org/Departments/Utilities/Utilities-Services-Safety/Outages/Public-Safety- Power-Shutoffs. Item #2 Packet Pg. 27 10 community. The City maintains and updates the following reports and plans that provide information regarding the risks in Palo Alto and the necessary actions to take. - Threat and Hazard Identification and Risk Assessment Report8 - The result of the THIRA process is an organized evaluation of vulnerability and implementation measures based on the necessary capabilities to deal with the natural and non- natural hazards and threats of most concern. - Local Hazard Mitigation Plan9 - Identifies and prioritizes potential and existing hazards across jurisdictional borders, including hazards that may be further amplified by climate change, and provides mitigation objectives with prioritized actions. - Foothills Fire Management Plan10 - Addresses a broad range of integrated activities and produced planning documents to address and mitigate the impacts of fire hazards in the Palo Alto Foothills Area. E. Current and prior activities CPAU’s earlier Plans note mitigation tasks the City has already completed, such as preparing a Foothills Fire Mitigation Plan and acting as “territory lead” for the CPUC’s fire threat map. Additionally, prior Plans note ongoing efforts, which continue. These include regular vegetation management, inspection and maintenance of the electric system, and electric infrastructure designs that consider fire safety. Attachment A shows the status of CPAU’s mitigation-related activities. V. MONITORING THE PLAN A. Measuring Plan and inspection performance In preparing annual Plans, CPAU takes the opportunity to evaluate the current Plan for any deficiencies, or if any best practices have changed. In doing so, CPAU considers what, if anything, related to wildfires occurred in the high fire threat area. Any events related to wildfires or City electric infrastructure in the Foothills area could inform future Plans and help understand the effectiveness of the current Plan. Since CPAU began submitting these annual reports, there have been no wildfires in the high fire threat area. With regard to inspections, CPAU examines its electric equipment in the high fire threat area more frequently than in other areas of the service territory. Staff strive to ensure that all inspections are completed by June, before the historic start of fire season, or earlier, depending on drought conditions. Inspections are completed manually. Staff analyzes the results of the inspections for trends of any failures or maintenance needs, 8 The Threat and Hazard Identiﬁcation and Risk Assessment Report can be found @ https://www.cityofpaloalto.org/files/assets/public/oes/plans/unrestricted_palo_alto_thira_report_final_a pril-2017.pdf. 9 The Local Hazard Mitigation Plan can be found @ https://www.cityofpaloalto.org/files/assets/public/oes/lhmap/paloalto_separateannex_march2017.pdf. 10 The Foothills Fire Management Plan can be found @ https://www.cityofpaloalto.org/ﬁles/assets/public/oes/plans/foothills-ﬁre-management-plan-update- 2016-ﬁnal.pdf . Item #2 Packet Pg. 28 11 which can inform future design changes. Staff also monitors the performance of equipment during windy and raining weather as described in the metrics below. B. Performance and outcome metrics CPAU audits the effectiveness of the Plan’s mitigation and prevention efforts by using two broad metrics: performance and outcomes. Information specific to each are below: i. Performance metrics a. Vegetation management. This metric includes the amount of vegetation cleared or number of trees trimmed in the high fire threat area. b. Infrastructure maintenance in high fire threat area. This metric includes the amount of equipment and number of lines inspected and repaired (if needed) in the high fire threat area. c. Project status. This metric involves monitoring the progress of any projects related to mitigating wildfires from electric equipment or lines in the high fire threat area and ensuring that projects progress on the proper timeline. ii. Outcome metrics a. Electric-line ignited wildﬁre. This metric includes any ﬁre started by CPAU’s electric equipment in the high ﬁre threat area that traveled greater than one linear meter from the ignition point. In at least the past 20 years, there have been zero such ﬁres. b. Downed lines in the high ﬁre threat area. For purposes of this Plan, a wires-down event includes any instance where an electric line in the high ﬁre threat area of the service territory falls to the ground or onto a foreign object. CPAU will not normalize this metric by excluding unusual events, such as severe storms. Instead, staﬀ will supplement this metric with a qualitative description of any such unusual events. C. Applying previous Plan metrics to this Plan CPAU’s initial Plan speciﬁed two metrics for evaluating performance, each discussed below, and noting how they have informed this revised Plan: i. Outages to the overhead lines in the high ﬁre threat area Item #2 Packet Pg. 29 12 In the 2020 Plan, staﬀ described how CPAU would evaluate any outages in the high ﬁre threat area. (Page 21). It also noted a related project in Appendix F, rebuilding the overhead lines, the status of which is presented below in Appendix A. CPAU’s evaluation of any outages in the high ﬁre threat area described in 2020 remains: Determine if CPAU’s activities (a) should have prevented any outages, (b) were adequate to prevent an outage, (c) could be improved, and (d) could not have prevented an outage. Both the evaluation and metric remain for this Plan because they properly inform CPAU eﬀorts in preventing outages. Since January 1, 2020, CPAU has had 10 outages in the Foothills area. None were a result of a PSPS event or weather-related. Most were caused by animal activity in this heavily wooded area or a car hitting a pole. ii. Fire ignitions An important metric, CPAU stated in the 2020 Plan that staﬀ would provide the number of ﬁres occurring in the high ﬁre threat area that were less than 10 acres in size, speciﬁcally describing any ﬁres larger than 10 acres. Since January 1, 2020, CPAU has had zero wildﬁres in the high ﬁre threat area over 10 acres with no calls to 911 to report of a ﬁre of any size. If CPAU experiences any wildﬁres in this area, whether ignited by electric infrastructure or not, CPAU will work with the Fire Department, Oﬃce of Emergency Services, and any related local government agency to review the cause, how or if CPAU equipment related to the cause or was impacted and collaborate on any after-action activities. iii. Wires down This metric includes instances of any electric lines or conductors that fall to the ground or come into contact with a foreign object in the high ﬁre threat area. For each wires-down event, CPAU will utilize an evaluation system similar to CPAU’s outage evaluation: reviewing the cause, what actions may have prevented the event, and if there are areas for improvement. Item #2 Packet Pg. 30 13 APPENDIX A: WILDFIRE MITIGATION ACTIVITIES The City’s key mitigation activity is undergrounding eleven miles of overhead electric lines in the Foothills area. This project involves installing substructure work, including boxes for electric and fiber lines; removing electric lines and fiber lines from overhead poles; and installing pad- mount equipment where possible. This iterative project consists of multiple phases (Phases 1-4) and is expected to be complete in 2025. CPAU already installed three of four required substructures. This image is a high-level visual representation of the project area, timeline, and how many feet below the surface equipment will be placed. Item #2 Packet Pg. 31 14 WILDFIRE MITIGATION ACTIVITIES Activity Description Status Projected completion date Undergrounding Phase 1 and Phase 2 Substructure work, installing boxes and padmount equipment, pulling cable, energizing electric lines, and removing electric facilities off of overhead poles. Substructure work for Phases 1 and 2 in Foothills Park is done. Electric lines are now underground, and facilities are energized. Completed 2024 Utilizing Fiberglass Some poles will remain in the high fire threat area once lines are underground. CPAU will use new fiberglass crossarms when replacement is needed to enhance resiliency. Staff completed the fiberglass crossarms design, ordered materials, but faced shipping delays. Materials arrived in Spring 2023. Completed 2023 Outage Management System (OMS) Updating the Outage Management System to provide enhanced customer communication during outages and improve customer service. Implementation upgrades now oﬀer enhanced functionalities, enabling customer notiﬁcations and resource mobilization for outages and emergencies, with updates via email, text, and social media. Completed 2023 Overhead Pole Removal and Fiber Transfer Full removal of aerial facilities in Phases 1 and 2 by the end of the Summer. Fiber cable is still aerial due to long lead times for material, however that material has been received and staﬀ anticipate the full removal of aerial facilities in Phases 1 and 2 by then end of the Summer 2024. Fall 2024 Item #2 Packet Pg. 32 15 Activity Description Status Projected completion date Undergrounding Phase 3 Substructure work, installing boxes and padmount equipment, pulling cable, energizing electric lines, and removing electric facilities oﬀ of overhead poles. Substructure for Phase 3 has been completed on Pony Tracks Fire Road and Page Mill Road. Fall 2024 SCADA switch to facilitate deenergization To facilitate the ability to quickly shut oﬀ power on the line serving the high ﬁre threat area, CPAU staﬀ will install a remotely operable switch, providing Electric Dispatch Operators at the Utility Control Center the capability to deenergize the line immediately. CPAU selected the location of the remote switch and will install it while completing the above- mentioned undergrounding project Spring 2025 Fiber Optic Extension CPAU will design and install new ﬁber optic cable to enhance the communications capability in the high ﬁre threat area. Segments of underground communication conduit are being installed along with the electric substructure work, phase by phase. Summer 2025 Undergrounding Phase 4 Substructure work, installing boxes and padmount equipment, pulling cable, energizing electric lines, and removing electric facilities oﬀ of overhead poles. Phase 4 substructure is under construction along Page Mill Road and Montebello Road. It is expected to reach Montebello Reservoir by year-end. Staﬀ is discussing relocating the Public Utility easement with Mid-Peninsula Open Space to extend installation along Montebello Road beyond Montebello Reservoir. Spring 2025 Item #2 Packet Pg. 33 Item No. 3. Page 1 of 3 Utilities Advisory Commission Staff Report From: Dean Batchelor, Director Utilities Lead Department: Utilities Meeting Date: June 3, 2024 Staff Report: 2402-2691 TITLE Staff Recommends that the Utilities Advisory Commission Recommend the City Council Adopt the 2024 Annual Water Shortage Assessment Report RECOMMENDATION Staff requests the Utilities Advisory Commission (UAC) recommend the City Council adopt the 2024 Annual Water Shortage Assessment Report. EXECUTIVE SUMMARY Beginning in 2022, every urban water supplier in California must conduct an Annual Water Supply and Demand Assessment as required by California Water Code Section 10632 (a). Each urban water supplier must also submit an Annual Water Shortage Assessment Report to the Department of Water Resources (DWR) on or before July 1, as required by California Water Code Section 10632.1. The City’s Annual Water Shortage Assessment Report (Attachment A, Tables 1- 5) shows that there is no water shortage anticipated for Fiscal Year 2025. On April 15, 2024, the San Francisco Public Utilities Commission (SFPUC), Palo Alto’s water supplier, provided Palo Alto with the Water Supply Availability Update indicating for the current water year, Hetch Hetchy watershed has experienced nearly average conditions for precipitation and snowpack. The City of Palo Alto encourages continued water conservation efforts and the City’s website contains more information about available water conservation programs.1 DISCUSSION To prepare the 2024 Annual Water Shortage Assessment Report, staff followed the procedures outlined in its Water Shortage Contingency Plan, contained in Section 7 of the City’s 2020 Urban Water Management Plan (UWMP).2 Palo Alto’s 2024 Annual Water Shortage Assessment Report uses the DWR-developed Optional Annual Assessment Tool format. This format includes the 5 tables shown in Attachment A. Staff will submit the standard tables to DWR by July 1, 2024. 1 Water Conservation Programs https://www.cityofpaloalto.org/Departments/Utilities/Sustainability/Ways-to- Save 2 UWMP https://www.cityofpaloalto.org/files/assets/public/v/1/utilities/uwmp/2020-uwmp_final-submission-to- dwr.pdf Item #3 Packet Pg. 34 Item No. 3. Page 2 of 3 “Table 1. Annual Assessment Information” (Table 1) provides required overview information. The remaining tables project water supply and demand for FY 2025 under dry conditions, as required, and finds that there is no projected water shortage. After Palo Alto and other urban water suppliers report to DWR on the 2024 Annual Water Shortage Assessment Reports, DWR will prepare a summary report on its review of the Annual Water Supply and Demand Assessment results and provide it to the State Water Resources Control Board (State Board) by September 30. The DWR report will include water shortage information at the supplier level, as well as regional and statewide analysis of water conditions as required by California Water Code Section 10644 (c)(1)(B). Potable Water Palo Alto receives 100% of its potable water supply from the SFPUC Regional Water System and staff used the SFPUC's April 15, 2024 Water Supply Availability Update to determine water supply. • “Table 2: Water Demands” (Table 2) provides a demand projection for each month of FY 2025; • “Table 3: Water Supplies” (Table 3) notes that there is sufficient supply to meet Palo Alto’s demand and projects supply equal to the demand projection since there is no projected water shortage in FY 2025; • “Table 4(P): Potable Water Shortage Assessment” (Table 4(P)) compares projected FY 2025 demand with supply and illustrates that there is no shortage projected for FY 2025; • “Table 5: Planned Water Shortage Response Actions” (Table 5) shows no triggered water shortage actions. Palo Alto’s eight permanent water use regulations remain in effect (see Palo Alto Municipal Code Section 12.32.010). Non-Potable Water For non-potable recycled water, Table 2 provides the demand projection and Table 3 notes that there is sufficient supply to meet Palo Alto’s non-potable recycled water demand in FY 2025. For that reason, the supply is set to equal demand and there is no shortage of non-potable water projected in Table 4(NP), “Non-Potable Water Shortage Assessment”. ANALYSIS Upon review, discussion, and action by the UAC, staff will bring the Annual Water Shortage Assessment Report to the City Council to consider its adoption on June 19, 2024. California Water Code Section 10632.1 requires the Annual Water Shortage Assessment Report to be submitted to DWR by July 1 each year. FISCAL/RESOURCE IMPACT There is no fiscal impact from Council approving the 2024 Annual Water Shortage Assessment Report. STAKEHOLDER ENGAGEMENT Item #3 Packet Pg. 35 Item No. 3. Page 3 of 3 Staff encourages interested parties to comment or provide feedback on the draft Annual Water Shortage Assessment Report at the UAC or Council meeting where the report will be considered for approval, or to submit written comments prior to those meetings. ENVIRONMENTAL REVIEW Adoption of the 2024 Annual Water Shortage Assessment Report is exempt from California Environmental Quality Act’s (CEQA) review pursuant to Water Code Section 10652. ATTACHMENTS Attachment A: 2024 Annual Water Shortage Assessment Report Tables Attachment B: Presentation AUTHOR/TITLE: Dean Batchelor, Director of Utilities Staff: Lisa Bilir, Senior Resource Planner Item #3 Packet Pg. 36 Attachment A: 2024 Annual Water Shortage Assessment Report Tables Item #3 Packet Pg. 37 Item #3 Packet Pg. 38 Item #3 Packet Pg. 39 Item #3 Packet Pg. 40 Item #3 Packet Pg. 41 Item #3 Packet Pg. 42 June 5, 2024 www.cityofpaloalto.org 2024 Annual Water Shortage Assessment Report Utilities Advisory Commission Item #3 Packet Pg. 43 TITLE 40 FONT BOLD Subtitle 32 font 2 www.cityofpaloalto.org §Beginning in 2022, every urban water supplier must: §1) Conduct an Annual Water Supply and Demand Assessment; and §2) Submit an Annual Water Shortage Assessment Report to the Department of Water Resources §Required by the California Water Code Sections 10632(a) and 10632.1 §There is no water shortage and no triggered water shortage actions §SFPUC’s April 15, 2024 Water Supply Availability Update indicates precipitation and snowpack close to long-term median levels; SFPUC does not anticipate any water shortage §Palo Alto’s temporary drought emergency water use restrictions expired June 10, 2023 §Permanent Water Use Restrictions (Palo Alto Municipal Code Section 12.32.010) Annual Water Shortage Assessment Report Item #3 Packet Pg. 44 TITLE 40 FONT BOLD Subtitle 32 font 3 www.cityofpaloalto.org The Utilities Advisory Commission recommends Council adopt the 2024 Annual Water Shortage Assessment Report. RECOMMENDED MOTION Item #3 Packet Pg. 45 Questions www.cityofpaloalto.org Item #3 Packet Pg. 46 Item No. 4. Page 1 of 1 Utilities Advisory Commission Staff Report From: Dean Batchelor, Director Utilities Lead Department: Utilities Meeting Date: June 3, 2024 Staff Report: 2404-2968 TITLE City of Palo Alto One Water Plan: Presentation of Initial Results RECOMMENDATION This item is for discussion and no action is requested. Staff seeks input from the Utilities Advisory Commission (UAC) on its initial results from the City of Palo Alto One Water Plan. The attached presentation describes the One Water Plan background, goals, approach, overview and initial results. Staff also plans to return to the UAC with a complete One Water Plan in Fall 2024 before finalizing the One Water Plan for Council acceptance by the end of 2024. A conceptual list of water supply options (projects) was provided to the UAC in February 2023 and is available as an attachment to Staff Report 14974.1 Attachment A provides a table of initial draft planning-level unit cost estimates for water supply projects; note that before Council approves any water supply project, additional studies would be necessary to explore information such as feasibility, engineering design and cost. ATTACHMENTS Attachment A: Unit Costs for Water Supply Options (Projects) Attachment B: Presentation AUTHOR/TITLE: Dean Batchelor, Director of Utilities Staff: Lisa Bilir, Senior Resource Planner 1 Staff Report 14974 https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes-reports/agendas- minutes/utilities-advisory-commission/archived-agenda-and-minutes/agendas-and-minutes-2023/02-feb-2023/02- 01-2023-id-14974-item-2.pdf Item #4 Packet Pg. 47 Attachment A – Initial Draft Planning Level Unit Cost Estimates of Water Supply Projects 1 | P a g e Note: Projects identiﬁed with “*” in the tables were included as water supply and conservation options and proceeded through the project screening Current Cost Basis 2023 Imported Desalination Units SFPUC* Enhanced Conservation, Phase 1* Enhanced Conservation, Phase 2* Irrigation Wells Emergency Well Conversion Full Treatment* Emergency Well Conversion (El Camino Only), Full Treatment Emergency Well Conversion Blending Emergency Well Conversion (El Camino Only) Blending DPR, Palo Alto Facility* DPR, Regional Facility* DPR, Palo Alto Facility with SSRF* IPR, Groundwater Injection* Non Potable Reuse Bay Water Desalination* Multi Source Storage Green Infrastructure Graywater Rain Barrels Total Capital Cost Capital Cost $0 $0 $0 $1,000,000 $49,760,760 $25,472,442 $1,532,363 $0 $105,257,000 $16,410,000 $48,900,000 $188,900,000 $148,510,000 $251,832,599 $22,630,000 $4,080,000 $0 $0 $ Land Acquisition Cost $0 $0 $0 $0 $0 $0 $0 $0 $11,463,000 $0 $7,400,000 $7,400,000 $0 $43,560,000 $0 $0 $0 $0 $ Amortized Capital and Land Cost $0 $0 $0 $65,051 $3,408,068 $1,788,376 $92,395 $0 $7,592,804 $1,067,494 $3,662,396 $12,769,597 $9,660,789 $19,215,712 $1,472,114 $265,410 $0 $0 $ Total Annual O&M Cost Groundwater Production Charge N/A N/A N/A $93,096 $5,172,000 $4,137,600 $5,172,000 $4,137,600 $0 $0 $0 $5,671,960 $0 $0 $0 $0 $0 $0 $ per Year O&M Cost $24,267,125 $188,176 $639,142 $6,822 $1,811,749 $1,362,069 $212,010 $169,608 $9,305,267 $6,049,640 $1,897,644 $6,213,260 $992,271 $9,827,073 $60,000 $240,000 $46,650 $43,251 $ per Year Energy Cost $0 N/A N/A $3,276 $99,964 $74,426 $99,964 $74,426 $74,733 $270,999 $45,045 $1,054,780 $82,592 $1,281,486 $0 $0 $0 $0 $ per Year Total Unit Cost Total Annual Cost $24,267,125 $188,176 $639,142 $168,246 $10,491,781 $7,362,471 $5,576,369 $4,381,634 $16,972,804 $7,117,134 $5,605,085 $25,709,597 $10,653,060 $30,324,272 $1,532,114 $505,410 $46,650 $43,251 $ per Yr Project Yield 10,982 606 330 54 2,250 1,800 3,000 2,400 4,723 1,769 630 5,150 1,100 4,480 39 30 6 0.7 Acre Feet per Year Capital Cost Unit Cost $0 $0 $0 $1,205 $1,515 $994 $31 $0 $1,608 $603 $5,813 $2,480 $8,783 $4,289 $38,125 $8,847 $0 $0 $ per AF GPC Unit Cost $0 $0 $0 $1,724 $2,299 $2,299 $1,724 $1,724 $0 $0 $0 $1,101 $0 $0 $0 $0 $0 $0 $ per AF O&M Unit Cost $2,210 $310 $1,939 $126 $805 $757 $71 $71 $1,970 $3,420 $3,012 $1,206 $902 $2,193 $1,554 $8,000 $8,215 $58,321 $ per AF Energy Unit Cost $0 $0 $0 $61 $44 $41 $33 $31 $16 $153 $71 $205 $75 $286 $0 $0 $0 $0 $ per AF Total Unit Cost $2,210 $310 $1,939 $3,116 $4,663 $4,090 $1,859 $1,826 $3,594 $4,024 $8,897 $4,992 $9,685 $6,768 $39,679 $16,847 $8,215 $58,321 $ per AF Future Cost Basis 2045 Imported Desalination Units SFPUC* Enhanced Conservation, Phase 1* Enhanced Conservation, Phase 2* Irrigation Wells Emergency Well Conversion Full Treatment* Emergency Well Conversion (El Camino Only), Full Treatment Emergency Well Conversion Blending Emergency Well Conversion (El Camino Only) Blending DPR, Palo Alto Facility* DPR, Regional Facility* DPR, Palo Alto Facility with SSRF* IPR, Groundwater Injection* Non Potable Reuse Bay Water Desalination* Multi Source Storage Green Infrastructure Graywater Rain Barrels Total Capital Cost Capital Cost $0 $0 $0 $1,071,225 $53,304,971 $27,286,717 $1,641,505 $0 $159,050,554 $29,450,626 $73,891,257 $240,333,553 $188,946,193 $380,536,347 $25,968,446 $4,681,894 $0 $0 $ Land Acquisition Cost $0 $0 $0 $0 $0 $0 $0 $0 $17,321,380 $0 $11,181,908 $9,414,867 $0 $65,822,151 $0 $0 $0 $0 $ Amortized Capital and Land Cost $0 $0 $0 $69,685 $3,650,808 $1,915,753 $98,976 $0 $11,473,247 $1,915,805 $5,534,131 $16,246,493 $12,291,221 $29,036,261 $1,689,285 $1,689,285 $0 $0 $ Total O&M Cost Groundwater Production Charge $0 $0 $0 $346,726 $19,262,570 $19,262,570 $19,262,570 $15,410,056 $0 $0 $0 $21,124,618 $0 $0 $0 $0 $0 $0 $ per Year O&M Cost $49,517,551 $418,502 $1,421,444 $15,173 $4,029,311 $3,029,227 $471,508 $377,206 $20,694,811 $13,454,332 $4,220,340 $13,818,221 $2,206,800 $21,855,303 $133,439 $533,757 $103,749 $96,190 $ per Year Energy Cost $0 $0 $0 $4,826 $159,607 $118,832 $159,607 $118,832 $119,323 $432,691 $71,921 $1,684,115 $131,871 $2,046,084 $0 $0 $0 $0 $ per Year Total Unit Cost Total Annual Cost $0 $418,502 $1,421,444 $436,410 $27,102,295 $24,326,381 $19,992,661 $15,906,094 $32,287,381 $15,370,137 $9,826,392 $52,873,447 $14,629,892 $52,937,648 $1,822,724 $2,223,042 $103,749 $96,190 $ per Yr Project Yield 12,113 606 330 54 2,250 1,800 3,000 2,400 4,723 1,769 630 5,150 1,100 4,480 39 30 6 1 Acre Feet per Year Capital Cost Unit Cost $0 $0 $0 $1,290 $1,623 $1,064 $33 $0 $2,429 $1,083 $8,784 $3,155 $11,174 $6,481 $43,749 $56,309 $0 $0 $ per AF GPC Unit Cost $0 $0 $0 $6,421 $8,561 $10,701 $6,421 $6,421 $0 $0 $0 $4,102 $0 $0 $0 $0 $0 $0 $ per AF O&M Unit Cost $4,088 $690 $4,313 $281 $1,791 $1,683 $157 $157 $4,382 $7,606 $6,699 $2,683 $2,006 $4,878 $3,456 $17,792 $18,271 $129,705 $ per AF Energy Unit Cost $0 $0 $0 $89 $71 $66 $53 $50 $25 $245 $114 $327 $120 $457 $0 $0 $0 $0 $ per AF Unit Cost $4,088 $690 $4,313 $8,082 $12,045 $13,515 $6,664 $6,628 $6,836 $8,689 $15,597 $10,267 $13,300 $11,815 $47,205 $74,101 $18,271 $129,705 $ per AF Other Conservation Conservation Water Reuse Other Water ReuseGroundwater Groundwater Item #4 Packet Pg. 48 June 3, 2024 www.cityofpaloalto.org One Water Plan: Initial Results Utilities Advisory Commission Item #4 Packet Pg. 49 2 www.cityofpaloalto.org One Water Initial Results Outline 1.Goal, Overview & Approach 2.Supply and Conservation Projects 3.Water Supply & Conservation Portfolios 4. Initial Conclusions 5. Next Steps Item #4 Packet Pg. 50 3 www.cityofpaloalto.org Previous UAC Meetings on One Water Plan •July 7, 2021 – One Water Plan Draft Scope •February 1, 2023 – One Water Plan Update; provided update on screening process, stakeholder engagement and portfolio approach Item #4 Packet Pg. 51 4 www.cityofpaloalto.org One Water Plan: Goal Council adoption of a One Water supply plan that is a 20-year adaptable roadmap for implementing prioritized portfolio alternatives for water supply and conservation Item #4 Packet Pg. 52 5 www.cityofpaloalto.org One Water Plan: Approach •Key Action in City’s Sustainability and Climate Action Plan (SCAP) •Long-term 20-year (through 2045) Water Supply Plan •Addresses future uncertainties •Includes robust and meaningful stakeholder engagement •In collaboration with Carollo Engineers, a national One Water thought leader •Builds on existing plans/work One Water Plan does not directly address: •Near-term drought •Short-term emergencies such as earthquakes and wildfires – addressed under separate emergency plans •Building codes Item #4 Packet Pg. 53 6 www.cityofpaloalto.org Key Uncertainties •Valley Water Transfer •About half of effluent from Regional Water Quality Control Plant •Option expires in 2033 •Transfer incompatible with some Palo Alto water supply options •Future Water Supply Availability (varies by water supply project) •Droughts •Climate Change •State regulations •SFPUC’s alternative water supply implementation •Cost Item #4 Packet Pg. 54 TITLE 40 FONT BOLD Subtitle 32 font 7 www.cityofpaloalto.org One Water Plan: Overview (Summer 2024) (End of 2024) Item #4 Packet Pg. 55 8 www.cityofpaloalto.org Water Supply and Conservation Project Screening §Environmental Benefits §Ease of Implementation §Cost §Reliability Item #4 Packet Pg. 56 9 www.cityofpaloalto.org Screening Results: Top Water Supply Projects Baseline - SFPUC (Regional Water System; Current Potable Water Supply) Conservation Phase 1 Conservation Phase 2 Groundwater Full Treatment (Iron, Manganese, Total Dissolved Solids) Groundwater Blending Direct Potable Reuse - Palo Alto Facility Direct Potable Reuse - Regional Facility Direct Potable Reuse - Palo Alto Facility with Small Salt Removal Facility Indirect Potable Reuse Bay Water Desalination Note: full list of water supply and conservation options attached to this presentation, and schematics on upcoming slides Item #4 Packet Pg. 57 10 www.cityofpaloalto.org Enhanced Conservation Phase 1 & 2 Possible Measures Conservation Phase 1 Conservation Phase 2 Outdoor irrigation assistance for commercial customers High Efficiency Toilet direct install for commercial customers Non- functional turf ban for commercial customers Turf conversion support for residential customers Front lawn limitation for residential new developments and major retrofits Front lawn limitation for residential properties upon resale Permanent 3-day watering week restriction Low-income residential High Efficiency Toilet direct install Item #4 Packet Pg. 58 11 www.cityofpaloalto.org Groundwater Options Groundwater Blending Only (no treatment) – not carried forward in One Water Plan, need to understand public acceptance Groundwater with blending plus Iron (Fe), Manganese (Mn) and Total Dissolved Solids (TDS) treatment SFPUC Water Item #4 Packet Pg. 59 12 www.cityofpaloalto.org Direct Potable Reuse (DPR) DPR Treatment Facility with three possible configurations: 1) Palo Alto DPR Facility Or 2) Regional DPR Facility owned by Valley Water, if effluent transfer occurs Or 3) Palo Alto DPR Facility that utilizes the Small Salt Removal Facility currently being built at the Regional Water Quality Control Plant Item #4 Packet Pg. 60 13 www.cityofpaloalto.org Indirect Potable Reuse (IPR) Item #4 Packet Pg. 61 14 www.cityofpaloalto.org Baywater Desalination Item #4 Packet Pg. 62 15 www.cityofpaloalto.org Project Normal Year Yield Comparison (Acre Feet per Year) Item #4 Packet Pg. 63 16 www.cityofpaloalto.org Project Unit Cost Per Acre Foot Comparison Item #4 Packet Pg. 64 17 www.cityofpaloalto.org Project Compatibility With Valley Water Effluent Transfer No Valley Water Transfer With Valley Water Transfer Baseline - SFPUC (Regional Water System; Current Potable Water Supply) Conservation Phase 1  Conservation Phase 2  Groundwater Full Treatment (Fe, Mn, TDS) Groundwater Blending  Direct Potable Reuse - Palo Alto Facility No Direct Potable Reuse - Regional Facility No  Direct Potable Reuse - Palo Alto Facility with SSRF  Indirect Potable Reuse – Palo Alto Facility No Bay Water Desalination  Note: list of water supply and conservation options attached to this presentation Item #4 Packet Pg. 65 Water Supply and Conservation Tool & Portfolios Item #4 Packet Pg. 66 19 www.cityofpaloalto.org Tool for Water Supply Portfolio Analysis Future Scenario Assumptions Project Variables Portfolio Development Project Costs Estimates Portfolio Evaluation Portfolio Supply Summary Portfolio Costs Estimates Portfolio Evaluation Graphical Outputs Water Demand Forecast Project Yields Project Cost Estimates Project Evaluation Data Inputs User Selections Outputs Item #4 Packet Pg. 67 20 www.cityofpaloalto.org Water Supply Portfolio Evaluation Criteria & Suggested Weights Suggested weights from stakeholder engagement meeting with community and interdepartmental staff as well as online survey Item #4 Packet Pg. 68 21 www.cityofpaloalto.org Initial Water Portfolio Evaluation Results Weighted Criteria Ranking by Portfolio - No Valley Water Transfer - 2045 Evaluation Criteria Note: 1)Each portfolio includes Conservation Phase 1 and Phase 2, except Baseline SFPUC 2)Each portfolio includes SFPUC supply Item #4 Packet Pg. 69 22 www.cityofpaloalto.org Initial Water Portfolio Evaluation Results Weighted Criteria Ranking by Portfolio - With Valley Water Transfer - 2045 Evaluation Criteria Note: 1)Each portfolio includes Conservation Phase 1 and Phase 2, except Baseline SFPUC 2)Each portfolio includes SFPUC supply Item #4 Packet Pg. 70 23 www.cityofpaloalto.org Initial Observations •Conservation Phase 1 and Phase 2 score higher than “do nothing” and do not require large investment to proceed (included in every portfolio other than the SFPUC or “do nothing”) •Highest Scoring Portfolios: DPR - Palo Alto Only No Valley Water Transfer DPR - Regional Facility with Valley Water Transfer •Both DPR portfolios contingent on Valley Water Effluent Transfer; resolved in nine years •Baywater Desal is highest scoring portfolio not dependent on the Valley Water Effluent Transfer •Other high scoring portfolio is emergency supply well conversion with blending only (no treatment); lower water quality so not included Item #4 Packet Pg. 71 24 www.cityofpaloalto.org Sensitivity of Initial Results Weighted Criteria Ranking by Portfolio - No Valley Water Transfer - 2045 Evaluation Criteria Note: 1)Each portfolio includes Conservation Phase 1 and Phase 2, except Baseline SFPUC 2)Each portfolio includes SFPUC supply Item #4 Packet Pg. 72 25 www.cityofpaloalto.org Sensitivity of Initial Results Weighted Criteria Ranking by Portfolio - With Valley Water Transfer - 2045 Evaluation Criteria Note: 1)Each portfolio includes Conservation Phase 1 and Phase 2, except Baseline SFPUC 2)Each portfolio includes SFPUC supply Item #4 Packet Pg. 73 26 www.cityofpaloalto.org Initial Results Sensitivity to Cost Weighting •Top portfolios unchanged DPR - Palo Alto Only No Valley Water Transfer DPR - Regional Facility with Valley Water Transfer •Conservation scores higher •Only the top scoring portfolio and Conservation score higher than Baseline – SFPUC •Groundwater blending only (no treatment) is second-highest scoring infrastructure project and scores higher than Baseline – SFPUC Item #4 Packet Pg. 74 27 www.cityofpaloalto.org Next Steps UAC Final One Water Plan (Fall 2024) •Recommended supply strategy •Trigger-based implementation plan City Council Final One Water Plan (End of 2024) Future Activities •Funding Strategy •Implementation •Updating One Water Tool as conditions change Item #4 Packet Pg. 75