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Home My WebLink AboutRESO 9638161011 jb 6053846 1 Resolution No. 9638 Resolution of the Council of the City of Palo Alto Adopting a Revised Net Energy Metering Cap Calculation Methodology and Repealing Resolution 9557 R E C I T A L S A. Net energy metering (NEM), is a billing arrangement that provides credit to customers for the full retail value of the electricity their system generates. B. State law requires all electric utilities to offer NEM to eligible customers with local distributed renewable generation up to a maximum cap of 5% of the utility's aggregate customer peak demand. C. The California Public Utilities Code affords publicly owned utilities (POUs), like Palo Alto, with the discretion to define "aggregate customer peak demand," leaving matters such as the best method for calculating "aggregate customer peak demand" and what reference year to use up to the City. D. Given the flexibility available to POUs and other nonInvestor Owned Utilities, there are a variety of differing methodologies in use for calculating the NEM cap across the state, resulting in confusion for utility customers and renewable energy installers operating across multiple utility service territories. E. On October 26, 2015, via Resolution 9557, Council formally adopted a NEM cap to be five percent of the City's peak demand achieved in 2006, or 9.5 megawatts (MW). F. On August 22, 2016, Council directed staff to revise the NEM cap calculation methodology to be five percent of the customer class noncoincident peak. Staff determined that the sum of the customer class noncoincident peaks in 2006 was 215.6 MW and that five percent of that is equal to 10.8 MW. The City's NEM installations are currently approximately 70% of the revised 10.8 MW NEM cap and staff estimates that the cap could be reached in 2017. Local renewable generation installations after the NEM cap is reached will be subject to the NEM Successor Program. G. NEM cap will encourage additional local renewable generation and formal adoption of the NEM cap promotes greater market certainty and transparency for customers and renewable energy installers operating within the community. The proposed revision to the NEM cap is consistent with NEM legislative and regulatory obligations and the Counciladopted Local Solar Plan to promote distributed solar projects. The Council of the City of Palo Alto does hereby RESOLVE as follows: SECTION 1. The City Council adopts the methodology for calculating the City's NEM cap to be five (5) percent of the sum of the City's noncoincident customer class peak demands, DocuSign Envelope ID: EE916C32-14C5-45E4-92EE-D9C30E50F2B8 161011 jb 6053846 2 which is defined as the sum of the 2006 historical noncoincident customer class peak electric demands of 215.6 megawatts (MW), or 10.8 MW. SECTION 2. Resolution 9557, which formally adopted a Net Energy Metering Cap Calculation Methodology as of October 26, 2015, is repealed. SECTION 3. The Council finds that adoption of the revision to the NEM cap does not meet the California Environmental Quality Act's definition of a "project" under Public Resources Code Section 21065 and CEQA Guidelines Section 15378(b)(5), because it is an administrative governmental activity which will not cause a direct or indirect physical change in the environment, thus no environmental review is required. INTRODUCED AND PASSED: November 7, 2016 AYES: BERMAN, BURT, DUBOIS, FILSETH, HOLMAN, KNISS, SCHARFF, SCHMID, WOLBACH NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk Mayor APPROVED AS TO FORM: APPROVED: Senior Deputy City Attorney City Manager Director of Utilities Director of Administrative Services DocuSign Envelope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