HomeMy WebLinkAboutRESO 9486Resolution No. 9486
Resolution of the Council of the City of Palo Alto Authorizing the City Manager or his Designee
to Purchase California Greenhouse Gas Allowances in the California Cap-and-Trade Auction to
Satisfy the City's Compliance Obligations for-the Gas Utility in an Amount Not to Exceed
$4,000,000 per Year and for the Electric Utility in an Amount Not to Exceed $250,000 per Year
RECITALS
A. The California Air Resources Board (CARB) has been authorized by California
Assembly Bill 32 (AB32) to develop regulations, including the Cap-and-Trade Program to reduce
California's greenhouse gas (GHG) emissions to 1990 levels by 2020.
B. An "Allowance" means a limited tradable authorization to emit up to one metric
ton of carbon dioxide equivalent.
C. Burning 1 therm of natural gas produces approximately 0.0053 metric tons of
carbon dioxide equivalent.
D. Entities covered by the Cap-and-Trade Program are required to purchase one (1)
Allowance for each metric ton of carbon dioxide equivalent of GHG they emit.
E. Beginning in 2015, the City of Palo Alto's (the "City") gas and electric utilities are
both covered by the Cap-and-Trade Program, such that the City will be obligated to secure
sufficient Allowances to cover the City's GHG emissions.
F. Under the terms of the Cap-and-Trade Program, the City's gas utility will be given
some free Allowances, but the City will also likely need to purchase additional Allowances to
cover all GHG emissions attributable to the City's gas utility.
G. The City does not own fossil-fueled generation, but ifthe City's electric utility
imports energy, the City may be required to purchase Allowances to cover all GHG emissions
attributable to the electric utility.
The Council of the City of Palo Alto RESOLVES, as follows:
SECTION 1. Pursuant to Section 2.30.340(b) of the Palo Alto Municipal Code and
consistent with Section G ofthe City's Energy Risk Management Policy, the Council hereby
authorizes the City Manager or his designee, the Director of Utilities, on behalf of the City to
purchase Allowances in the CARB Allowance auction (a) to meet the City's gas utility GHG actual
and/or forecast compliance obligation for the gas utility, (b) in an amount not to exceed
$4,000,000 per year, and (c) where the maximum term of any Allowance transaction shall not
exceed three {3) years, commencing on the date of execution of the transaction.
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SECTION 2. Pursuant to Section 2.30.340(b) of the Palo Alto Municipal Code and
consistent with Section G of the City's Energy Risk Management Policy, the Council hereby
authorizes the City Manager or his designee, the Director of Utilities, on behalf of the City to
purchase Allowances in the CARB Allowance auction (a) to meet the City's electric utility GHG
actual and/or forecast compliance obligation for the electric utility, (b) in an amount not to
exceed $250,000 per year, and (c) where the maximum term of any Allowance transaction shall
not exceed three (3) years, commencing on the date of execution of the transaction.
SECTION 3. The Council finds that the adoption ofthis resolution does not meet the
definition of a project under the California Environmental Quality Act (CEQA) pursuant to
California Public Resources Case Section 21065, and therefore, no environmental assessment is
required.
INTRODUCED AND PASSED: January 20, 2015
AVES: BERMAN, BURT, DUBOIS, FILSETH, HOLMAN, KNISS, SCHARFF, SCHMID, WOLBACH
NOES:
ABSENT:
ABSTENTIONS:
ATIEST:
City Clerk
APPROVED AS TO FORM:
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Mayor
APPROVED:
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