HomeMy WebLinkAboutRESO 9665Resolution No. 9665
Resolution of the Council of the City of Palo Alto Continuing the Palo Alto Clean Local Energy
Accessible Now Program at the Contract Rate of 16.5 ¢/kWh for Local Solar Resources until
Reaching 3 MW of Program Capacity and then Reducing the Contract Rate to the Avoided
Cost Value; and Increasing the Contract Rate for Nonsolar Renewable Energy Resources to 8.4
¢/kWh to 8.5 ¢/kWh Based on the Avoided Cost of Local Renewable Energy and Amending
Associated Program Rules
R E C I T A L S
A. On March 5, 2012, the City approved the Palo Alto Clean Local Energy Accessible
Now (CLEAN) Program (or feedin tariff). Under the Palo Alto CLEAN Program, participants who
build a new solar generating system in Palo Alto may obtain a longterm, fixedprice contract
with the City to sell the energy from the system to the electric utility.
B. Council extended the program beyond its original termination date of December
31, 2012 and has periodically reviewed the contract price and program cap.
C. On March 28, 2016, Council approved Resolution 9580 (as amended for
clarification by Resolution 9618 (8/22/16)), which continued Palo Alto CLEAN at the contract
price of 16.5 cents per kilowatthour (¢/kWh) for local solar resources, and reduced the
contract prices for local nonsolar renewable energy resources to 8.1 ¢/kWh for a 20year term
or 8.2 ¢/kWh for a 25year term. The contract rates for nonsolar resources were set to be
equal to the then current estimated avoided cost of the energy generated by these resources.
The resolution further continued the separate program caps of 3 megawatts (MW) of
generating capacity for both the solar and nonsolar resources.
D. In the past year, the City has received five CLEAN Program project applications
for local solar facilities, which together will total 1.43 MW of capacity, or 47.6% of the 3 MW
program cap.
E. The City wants to continue to encourage the development of distributed
renewable energy resources within its territory; however, it also wishes to minimize the impact
of these projects on ratepayers.
F. The City wants to continue the CLEAN program for solar resources at the current
contract price of 16.5 ¢/kWh until the program reaches the 3 MW cap, and extend the program
after reaching the 3 MW cap, but reduce the contract price to the avoided cost of such
energy (currently 8.9 ¢/kWh for a 20year contract term, or 9.1 ¢/kWh for a 25year contract
term) for all additional capacity. Therefore, the 3 MW program cap is eliminated since the
contract price after 3 MW of capacity is reached is equal to the avoided cost of energy
such that there is no rate impact.
G. Additionally, the City wants to raise the contract prices available to local non
solar eligible renewable resources to 8.4 ¢/kWh for a 20year term or 8.5 ¢/kWh for a 25year
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term for such resources, which is equal to the current estimated avoided cost of energy
generated by these resources. For local nonsolar resources, the 3 MW cap is eliminated since
there is no rate impact when the contract price is equal to the avoided cost of energy for these
resources.
The Council of the City of Palo Alto
SECTION 1. The Council adopts revised Palo Alto CLEAN Program Eligibility Rules
Requirements, set forth in Exhibit 1 attached to this Resolution.
SECTION 2. The Council authorizes the City Manager or his designee to sign contracts
for the output of one or more solar, or other nonsolar eligible renewable energy resource
meeting the CLEAN Program Eligibility Rules and Requirements described in Section 1.
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SECTION 3. The Council finds that the adoption of this resolution and the associated
amendment of CLEAN Program Eligibility Rules and Requirements is not subject to California
Environmental Quality Act (CEQA) review because adoption of this resolution and associated
amendment of CLEAN Program rules is an administrative government activity that will not
result in any direct or indirect physical change to the environment as a result (CEQA Guidelines
section 15378(b)(5)).
INTRODUCED AND PASSED: February 6, 2017
AYES: DUBOIS, FILSETH, FINE, HOLMAN, KOU, SCHARFF, TANAKA, WOLBACH
NOES:
ABSENT: KNISS
ABSTENTIONS:
ATTEST:
City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
Senior Deputy City Attorney City Manager
Asst. City Manager/Utilities General
Manger
Director of Administrative Services
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PALOALTOCLEAN(CLEANLOCAL ENERGYACCESSIBLE NOW)
PROGRAM ELIGIBILITY RULES AND REQUIREMENTS
Effective 2/06/2017
PARTICIPATION ELIGIBILITY:
The Palo Alto Clean Local Energy Accessible Now Program (the is open to
participation by any Eligible Renewable Energy Resource, as defined in Section D.4, that
satisfies these Program Eligibility Rules and Requirements.
TERRITORIALITY REQUIREMENT:
In order to be eligible to participate in the CLEAN Program, an Eligible Renewable Energy
Resource must be located in and generating electricity from within the utility service area of
the City of Palo Alto.
PRICES AND TERM FOR ELIGIBLE RENEWABLE RESOURCES:
The following purchase prices shall apply to the electricity produced by an Eligible
Renewable Energy Resource participating in the Program, except as provided in Section D.5.
Solar Energy Resources:
Total Solar Capacity Reserved Contract Term Contract Price
03 MW 20 or 25 years $0.165 / kWh
More than 3 MW 20 years $0.089 / kWh
More than 3 MW 25 years $0.091 / kWh
Solar Energy Resources that straddle multiple pricing tiers shall receive a weightedaverage
purchase price based on the amount of their capacity that is contained in each tier.
NonSolar Eligible Renewable Energy Resources:
Contract Term Contract Price
20 years $0.084 / kWh
25 years $0.085 / kWh
ADDITIONAL RULES AND REQUIREMENTS:
1. The owner of the Eligible Renewable Energy Resource shall enter into an Eligible
Renewable Energy Resource Power Purchase Agreement with the City of Palo
Alto prior to delivering energy to the City.
2. An application for participation in the CLEAN Program to sell output to the City (the
may be submitted at any time. Applications will be considered in the
order received.
3. Eligible Renewable Energy Resource means an electric generating facility that: (a) is
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PALOALTOCLEAN(CLEANLOCAL ENERGYACCESSIBLE NOW)
PROGRAM ELIGIBILITY RULES AND REQUIREMENTS
Effective 2/06/2017
defined and qualifies as an renewable energy under California Public
Utilities Code Section 399.12(e) and California Public Resources Code Section 25471,
respectively, as amended; and (b) meets the territoriality requirement set forth in
Section B.
4. The California Energy certification of the Eligible Renewable
Energy Resource shall be required within six (6) months of the commercial operation
date of the generating facility; the owner shall provide written notice of the
certification to the City within ten (10) business days of receipt of said
certification. If the City agrees, in its sole discretion, to take delivery of the generating
electricity prior to the certification, then, as the electricity
cannot be considered in fulfillment of the RPS requirements, the price that the
City will pay for the generating electricity (the Certification will be
set to $0.076 per kWh (for a 20year contract term) or $0.08 per kWh (for a 25year
contract term), based on the estimated levelized cost of brown power over a 20year or
25year period, respectively. Upon the certification of the generating facility and
the provision of notice of such certification to the City in accordance with this section,
the City will pay the Price set forth in Section C of these CLEAN Program Rules and
Requirements and the PPA (collectively referred to as the for the
generating electricity delivered on and after the date of the certification.
The City will, in its sole discretion, as appropriate, the difference between the
Contract Price and the PreCertification Price for any electricity received and paid for by
the City, effective as of the date of certification of the Eligible Renewable Energy
Resource.
5. If an Eligible Renewable Energy Resource is authorized to participate in the CLEAN
Program, then that Resource shall not be entitled to receive any rebate or other
incentive from the Photovoltaic (PV) Partners Program or any other similar
incentive program funded by the ratepayers. To the extent any rebate or
incentive is paid to the owner of the Resource, that rebate or incentive shall be
disgorged and refunded to the City upon 30 if the Eligible Renewable
Energy Resource continues to participate in the CLEAN Program. If a rebate or an
incentive has been paid to the Eligible Renewable Energy Resource, then that Resource
shall be ineligible to participate in the CLEAN Program.
6. All electricity generated by the Eligible Renewable Energy Resource shall be delivered
only to the City. No portion of the electricity may be used to offset any load of the
generating facility (other than incidental loads associated with operating the generating
facility).
7. A metering and administration fee will be charged to each Eligible Renewable Energy
Resource that participates in the CLEAN Program. See Utilities Rate Schedule E15
(Electric Service Connection Fees).
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