HomeMy WebLinkAboutStaff Report 3070
City of Palo Alto (ID # 3070)
City Council Staff Report
Report Type: Informational Report Meeting Date: 9/18/2012
Summary Title: Semi-annual LEAP Update
Title: Third Semi-Annual Long-term Electric Acquisition Plan (LEAP) Update
From: City Manager
Lead Department: Utilities
Executive Summary
This third semi-annual update of the Long-term Electric Acquisition Plan (LEAP) is provided to
the City Council as information only. The purpose of the update is to keep the Council apprised
of staff’s efforts towards implementing the Council-approved LEAP Objectives, Strategies and
Implementation Plan.
Much progress continues to be made towards implementing the tasks in the LEAP
Implementation Plan. Since the last LEAP update in March 2012, staff has made significant
progress towards several key LEAP implementation items including launching of the Palo Alto
CLEAN program in April 2012; Council approval of modifications to the City Renewable Portfolio
Standard (RPS); extensive evaluation of several proposals and negotiations with potential
suppliers under the City’s request for proposal for renewable resources to meet the City’s RPS;
and Council support to develop a plan to achieve carbon neutrality for the electric portfolio by
January 2015.
Staff may return to Council in 2013 with modifications to LEAP in support of the City’s efforts
towards implementing a plan to achieve carbon neutrality for the electric portfolio. At that
time, staff may propose modifications to the LEAP Implementation Plan and will address the
need for continued semi-annual reporting to Council.
Attachments:
Attachment A: LEAP Update September 2012 (PDF)
Attachment B: Council-Approved LEAP Objectives, Strategies and Implementation Plan
(PDF)
Prepared By: Monica Padilla, Sr. Resource Planner
Department Head: Valerie Fong, Director
City Manager Approval: ____________________________________
James Keene, City Manager
Page 1 of 7
Long-term Electric Acquisition Plan (LEAP)
Semi-annual Update – September 2012
LEAP Implementation Plan Item
Estimated
Completion
in LEAP September 2012 Update Status
Strategy #1 - Resource Acquisition
1. Adjust planning and portfolio models to include an
integrated and least cost planning perspective which
evaluates demand and supply side resources in an
integrated manner and includes time of delivery,
locational and environmental costs and benefits.
Dec. 2010 Completed
2. Evaluate the impacts of energy efficiency, demand
reductions and electric vehicle penetration in Palo
Alto in the annual development of the electric load
forecast.
Dec. 2010 Completed
Strategy #2 – Electric Energy Efficiency and Demand Reduction
3. Provide quarterly updates on electric efficiency
program achievements including tracking against 10-
Year Energy Efficiency goals to the UAC and annual
updates to the City Council.
quarterly No update* On-going
4. Develop Energy Efficiency Implementation Plan for
the 2010 10-Year Electric EE Plan addressing certain
items identified in the May 2010 Council Colleagues
Memo and identification of resources and funding
needed to achieve EE goals.
Apr. 2011 Completed
5. Evaluate fuel switching energy efficiency measures
and include them, if cost-effective, in the Electric and
Gas EE Implementation Plans.
Feb. 2011 Completed
6. Develop a pilot Demand Response Program for large
commercial industrial customers for implementation
in summer 2011.
Apr. 2011 Completed
Page 2 of 7
LEAP Implementation Plan Item
Estimated
Completion
in LEAP September 2012 Update Status
7. Assess the feasibility and cost-effectiveness of
using current and potential thermal energy storage
(TES) systems to shift load from on-peak periods
to off-peak periods, for use in a demand response
program, or for meeting any energy storage
needs. Coordinate with task 21 to develop targets,
if appropriate.
Dec. 2011 A summer intern is working on this task and has
prepared an inventory of TES systems in Palo Alto,
evaluating their current operation, researching new
systems and will be recommending a course of action
for the future.
Report to
UAC in
Nov 2012
8. Fully integrate the effects on energy efficiency in the
long-term electric load forecast.
Nov. 2010 Completed
Strategy #3 – Renewable Portfolio Standard (RPS)
9. Evaluate the merits of implementing a feed-in-tariff
(FIT) and the potential to meet RPS goals through
local renewable resources.
Jan. 2011 Completed
10. Seek UAC recommendation and Council approval of
the policy elements of a FIT to encourage local
renewable resource projects.
May 2011 Completed
11. Continue working with NCPA to identify
opportunities, including joint-ownership, for
developing qualifying renewable resources.
On-going Joint ownership options being investigated include a
geothermal project (see item #13) and the installation of
micro-turbines at the Calaveras Hydroelectric Project.
In May 2012, Council approved the NCPA REC
Transfer Agreement to allow the City to receive RECs
associated with certain projects managed by NCPA.
On-going
12. Evaluate the use of renewable energy credits (RECs)
to meet a portion of the City’s RPS goal and/or
greenhouse gas emission reduction goals and monitor
the regulations and requirements regarding the use of
RECs to meet RPS goals.
On-going The assessment of the use of RECs will be further
considered in the development of a carbon neutral plan
(see item #26 below).
On-going
13. Evaluate a proposed geothermal project being
considered by NCPA, including a pre-pay option and
the benefit, costs, and risks of a pre-pay structure.
June 2011 No update* In process
Page 3 of 7
LEAP Implementation Plan Item
Estimated
Completion
in LEAP September 2012 Update Status
14. Conduct a Request for Proposals for eligible
renewable resources including RECs and evaluate
alternative renewable resource technologies and
contracting mechanisms.
RFP in
June 2011
Staff issued a Request for Proposals for eligible
renewable resources in September 2011. A total of 65
project proposals were received in October 2011. Staff
is now finalizing the negotiations for a Power Purchase
Agreement with one finalist and anticipates bringing this
agreement to Council for consideration by October
2012. Staff also plans to issue another RFP for eligible
renewable resources in August/September 2012.
In conjunction with item #26 below, staff reviewed with
the UAC in November 2011 the RPS goal to clarify the
governing constraint (33%, or 0.5 cent/kWh rate impact)
and to ensure alignment with State law. In April 2012
Council considered the proposal and amended the policy
to clarify that the 0.5 cent/kWh rate impact limit is the
governing constraint.
In process
Strategy #4 – Local Generation
15. Provide an update of past local generation feasibility
studies and actions to UAC and Council
Dec. 2010 Completed
16. Assess the potential for and feasibility of small local
distributed and non-distributed, renewable and
cogeneration projects, including using a FIT to
encourage these projects.
Jan. 2011 Renewable projects are being evaluated as part of the
City’s feed-in tariff program (see item #19). An
assessment of cogeneration will be part of evaluation of
the City’s PLUG-In program. See item #18.
In process
17. Assess the potential, benefits and costs of developing
and/or joint ownership of a 25 to 50 MW gas-fired
power plant located in or near Palo Alto to meet load,
reliability and local capacity needs.
Jun. 2011 Completed
18. Evaluate the City’s PLUG-In Program to encourage
cogeneration including rules, regulations, and buy
back rates and recommend modifications as needed.
Dec. 2011 This item is on hold pending further analysis of
adopting a carbon reduction goal for the City’s electric
portfolio (see item #26).
On hold.
Page 4 of 7
LEAP Implementation Plan Item
Estimated
Completion
in LEAP September 2012 Update Status
19. Following receiving Council direction from
Implementation Plan Initiative #10, develop a FIT
proposal including rate, rules, regulations, standard
contract form and limits.
To be
determined
Completed
20. Assess the economics and potential of the anaerobic
digester as a local generation resource for CPAU
Sep. 2011 CPAU staff is actively involved in the Public Works
Department’s evaluation process.
In process
21. Assess the need for and value of energy storage to
support local renewable distributed generation
resources. Determine any appropriate energy
storage targets to be achieved by December 31,
2016, and December 31, 2021. Report back to the
Council regarding what procurement targets, if
any, are deemed to be appropriate so that the
Council may adopt such procurement targets, if
determined to be appropriate, by October 1, 2014.
Oct. 2014 In March 2012, Council modified LEAP
Implementation tasks #7 and #21 in order to comply
with AB 2514. As directed by Public Utilities Code
Section 2836, staff will bring to UAC/Council a report
with recommended energy storage targets, if any, for
potential council adoption in Winter of 2013.
Additionally, a summer intern is evaluating TES
systems in Palo Alto (see task #7) in support of this task.
Council
March
2012
Fall’12/
Winter’13
Strategy #5 – Climate Protection
22. Promote the City’s Plug-in program to encourage
development of cogeneration systems.
On-going Staff continues to provide information to interested
applicants under the City’s existing PLUG-In program.
Also see item #18 above.
On-going
23. Analyze electric vehicle (EV) charging patterns and
evaluate rates to incent nighttime EV charging.
Jun. 2011 Staff provided an EV time of use (TOU) proposal to the
UAC in July 2012. Staff is updating the proposed rate
to incorporate UAC input and open the TOU rate to all
residential customers (except those with PV systems).
Proposal planned for UAC in Sept and Council in Oct.
Phase 1 of pilot planned to start in Fall 2012
Planned for
Fall of
2012 to
Fall of
2013
24. Meet AB32 mandated annual reporting requirements
to California Air Resources Board on annual volumes
of electricity purchases by resource.
Annually,
next in Jun.
2012
Annual report to CARB of electricity purchase volumes
by resource was submitted on time on June 1, 2012.
Completed
25. Track and report annually on 6 major greenhouse gas
emissions (CO2, CH4, N2O, SF6, HFCs, PFCs) for all
of the City’s municipal operations and calculate
electric portfolio’s overall emissions coefficients (lbs
of CO2, CH4, and N2O per MWh of purchases).
Annually,
next in
Sep. 2012
Report with emissions data for calendar year 2010
submitted to The Climate Registry in December 2011.
Utilities and Public Works staff is coordinating efforts
to submit calendar year 2011 report to The Climate
Registry by October 2012.
On-going
Page 5 of 7
LEAP Implementation Plan Item
Estimated
Completion
in LEAP September 2012 Update Status
26. Evaluate the costs, benefits and impacts of the
implementation of an electric portfolio carbon neutral
policy and the setting of quantitative goals (e.g. carbon
intensity, total GHG emissions).
Jan. 2012 In May 2012, Council unanimously supported a policy
to achieve carbon neutrality for the electric supply
portfolio and directed staff to develop a plan by
December 2012 to get to carbon neutrality by January
2015.
In July 2012, the UAC unanimously supported a
recommended definition of carbon neutrality, however
at the July 16, 2012 Council meeting, the Council
directed staff to return to the Finance Committee for
further consideration of the definition of carbon
neutrality for the electric utility.
Assuming Council approval of a carbon neutral
definition (expected in Oct. 2012), staff plans to provide
a carbon neutral plan to the UAC in November 2012.
In process
27. Evaluate PaloAltoGreen program design and
recommend modifications, as appropriate, including
constructing PaloAltoGreen to assist in meeting
Renewable Portfolio Standard goals.
Jun. 2012 Proposed modifications to PaloAltoGreen will be
undertaken in coordination with the development of a
Carbon Neutral Plan for the electric portfolio (see task
26).
In process
Strategy #6 – Hydro Resource Management
28. Evaluate potential rate adjustment mechanisms that
would adjust electric rates based on hydrologic year
type and develop a recommendation for a rate.
Apr. 2011 Staff anticipates bringing this item for discussion to the
UAC in late 2012. Implementation has been delayed
due to other priorities. Such a change could be
implemented in FY 2014.
On hold
29. Assess the value related to Palo Alto’s participation in
the CAISO’s Metered Subsystem Agreement and the
use of the Calaveras hydroelectric project for load
following.
On-going No update * On-going
30. Identify long-term opportunities to maximize the value
of the Calaveras hydroelectric project as an energy
storage resource.
On-going This assessment will be undertaken as staff’s on-going
effort to maximize the value of the City’s electric
resources. Additionally, staff intends to explore hydro
energy storage in the context of meeting the
requirements set forth in AB 2514 (see item #21).
On-going
Page 6 of 7
LEAP Implementation Plan Item
Estimated
Completion
in LEAP September 2012 Update Status
31. Work with NCPA to seek opportunities to increase the
efficiency of the Calaveras hydroelectric project and
implement operational value maximizing strategies.
On-going No update * On-going
Strategy #7 – Market Price Exposure Management
32. Evaluate a block purchase of up to 25 MW to meet
base load needs for Jan-Mar and Nov-Dec for a term
of up to 5 years.
Feb. 2011 In March 2011, UAC supported staff’s recommendation
for further consideration of a block purchase if the price
of a 25 MW block for 2013 to 2017 dropped to
$40/MWh or below. At present, the price estimate for
such a product is $45/MWh. Staff has deferred the five-
year block purchase pending the development of the
Carbon Neutral Plan and establishment of new electric
master agreements.
On hold
33. Conduct an RFP for new electric master agreement
counterparties.
Dec. 2011 Staff issued an RFP in March 2012 to seek new electric
counterparties under master enabling agreements. Staff
is in negotiations with several potential new
counterparties and anticipates seeking Council approval
of a set of master agreements in Oct/Nov 2012.
In process
34. Explore opportunities with NCPA, other municipal
utilities and/or third party suppliers to reduce
scheduling and/or operating costs.
On-going No update * On-going
35. Continue to implement a 3-year laddering strategy to
manage market price uncertainty.
On-going No update * On-going
Strategy #8 – Transmission and Reliability
36. Investigate transmission connection voltage upgrade
from 115 to 230 kV, and the potential for a
transmission reliability connection to west side.
On-going The City met in February with SLAC, Western, and
Stanford University (who has also expressed an interest
in participating in the project) to discuss next steps.
Following this meeting the City drafted a set of guiding
principles for a possible agreement with SLAC, Western
and Stanford. There has been no formal reply from
SLAC or the Department of Energy (DOE), but there
have been meetings between these parties. City recently
was made aware of a DOE on-site rep at SLAC and is
attempting to engage the DOE more in the discussions.
The next meeting is scheduled for September 2012.
On-going
Page 7 of 7
LEAP Implementation Plan Item
Estimated
Completion
in LEAP September 2012 Update Status
37. Explore transmission opportunities and strategies to
meet long-term renewable portfolio objectives beyond
2020.
On-going No Update * On-going
38. Evaluate joint efforts for power plant ownership
opportunities or long-term agreements to meet the
City’s Resource Adequacy Program requirements.
On-going No Update * On-going
* No update – For these items, there is no update since the March 2012 semi-annual LEAP update
Key for Acronyms:
AB – Assembly Bill
AB32 – Assembly Bill for Greenhouse Gas Emissions Reduction
AB 2514 – Assembly Bill for Energy Storage
CAISO – California Independent System Operator
CARB – California Air Resources Board
CH4 – Methane
CO2 – Carbon Dioxide
CPAU – City of Palo Alto Utilities
DOE – Department of Energy
EE – Energy Efficiency
EV – Electric Vehicle
FIT – Feed-in-tariff
GHG – Greenhouse Gas Emissions
HFCs – Hydrofluorocarbons
kV – Kilo volt
kWh – Kilowatt-hour
MSSA – Metered Subsystem Agreement
MW – Mega Watt
MWh – Mega Watt hour
N2O – Nitrous Oxide
NCPA – Northern California Power Agency
PFCs – Perfluorocarbons
PLUG-In – Power from Local Ultra-clean Generation Incentive
RFP – Request for Proposal
RPS – Renewable Portfolio Standard
SB2 1X – California Senate Bill for 33% RPS
SF6 – Sulfur Hexafluoride
SLAC – SLAC National Accelerator Laboratory
TES – Thermal Energy Storage
TOU – Time-of-Use
UAC – Utilities Advisory Commission
WAPA – Western Area Power Administration
Page 1 of 5
Long-term Electric Acquisition Plan (LEAP)
Objectives, Strategies and Implementation Plan
Approved March 7, 2011 (Resolution No. 9152)
Modified by Council March 19, 2012 (Staff Report No. 2581)
Modified by Council April 16, 2012 (Staff Report No. 2710)
LEAP Objectives:
1. Meet customer electricity needs through the acquisition of least total cost energy and
demand resources including an assessment of the environmental costs and benefits.
2. Manage supply portfolio cost uncertainty to meet rate and reserve objectives.
3. Enhance supply reliability to meet City and customer needs by pursuing opportunities
including transmission system upgrades and local generation.
LEAP Strategies and Implementation Plan Steps:
1. Resource Acquisition – Pursue the least total cost resources including an assessment of
environmental costs and benefits to meet the City’s needs in the long term by:
a. Evaluating each potential resource on an equal basis by evaluating rate impacts and
establishing costs and values for location, time of day and year, carbon, value of
renewable supplies and any secondary benefits attributed to the resource; and
b. Including all resources – conventional energy, local and remote renewable energy
supplies, energy efficiency, cogeneration, and demand reduction – in the evaluation.
Implementation Plan Items for Strategy #1 – Resource Acquisition Estimated
Completion
1. Adjust planning and portfolio models to include an integrated and least cost
planning perspective which evaluates demand and supply side resources in an
integrated manner and includes time of delivery, locational and environmental
costs and benefits.
Dec. 2010
2. Evaluate the impacts of energy efficiency, demand reductions and electric
vehicle penetration in Palo Alto in the annual development of the electric load
forecast.
Dec. 2010
2. Electric Energy Efficiency and Demand Reduction – Fund programs that maximize
the deployment of cost-effective, reliable and feasible energy efficiency and demand
reduction opportunities as the highest priority resources by:
a. Every three years, preparing a ten-year energy efficiency plan that identifies all cost-
effective energy efficiency opportunities;
b. Using the cost of long-term renewable energy resources adjusted for time of day
factors and location as the avoided cost when evaluating cost effectiveness of energy
efficiency measures;
c. Designing and making energy efficiency programs available to all customers; and
d. Considering the impacts (costs, benefits and GHG emissions) of substituting
electricity-using appliances for natural gas-using appliances and vice versa in the ten-
year energy efficiency plan.
Page 2 of 5
Implementation Plan Items for Strategy #2 – Electric Energy Efficiency and
Demand Reduction
Estimated
Completion
3. Provide quarterly updates on electric efficiency program achievements
including tracking against 10-Year Energy Efficiency goals to the UAC and
annual updates to the City Council.
quarterly
4. Develop Energy Efficiency Implementation Plan for the 2010 10-Year
Electric EE Plan addressing certain items identified in the May 2010 Council
Colleagues Memo and identification of resources and funding needed to
achieve EE goals.
Apr. 2011
5. Evaluate fuel switching energy efficiency measures and include them, if cost-
effective, in the Electric and Gas EE Implementation Plans.
Feb. 2011
6. Develop a pilot Demand Response Program for large commercial industrial
customers for implementation in summer 2011.
Apr. 2011
7. Assess the feasibility and cost-effectiveness of using current and potential
thermal energy storage (TES) systems to shift load from on-peak periods to
off-peak periods, for use in a demand response program, or for meeting any
energy storage needs. Coordinate with task 21 to develop targets, if
appropriate.
Sep. 2011
3. Renewable Portfolio Standard (RPS) – Reduce the carbon intensity of the electric
portfolio by acquiring renewable energy supplies by:
a. Pursuing a minimum level of renewable purchases of at least 33% of retail sales by
2015 with the following attributes:
i. The contracts for investment in renewable resources shall not exceed 30 years in
term.
ii. Pursue only renewable resources deemed to be eligible by the California Energy
Commission (CEC).
iii. Evaluate use of Renewable Energy Certificates (RECs) to meet RPS.
b. Ensuring that the retail rate impact for renewable purchases does not exceed 0.5
¢/kWh on average; and
c. Performing an ongoing evaluation of the Palo Alto Clean Local Energy Accessible
Now (CLEAN) program.
Proposed Implementation Plan Items for Strategy #3 – Renewable Portfolio
Standard (RPS)
Estimated
Completion
8. Fully integrate the effects on energy efficiency in the long-term electric load
forecast.
Nov. 2010
9. Evaluate the merits of implementing a feed-in-tariff (FIT) and the potential to
meet RPS goals through local renewable resources.
Jan. 2011
10. Seek UAC recommendation and Council approval of the policy elements of a
FIT to encourage local renewable resource projects.
May 2011
11. Continue working with NCPA to identify opportunities, including joint-
ownership, for developing qualifying renewable resources.
On-going
Page 3 of 5
Proposed Implementation Plan Items for Strategy #3 – Renewable Portfolio
Standard (RPS)
Estimated
Completion
12. Evaluate the use of renewable energy credits (REC) to meet a portion of the
City’s RPS goal and/or greenhouse gas emission reduction goals and monitor
the regulations and requirements regarding the use of RECs to meet RPS
goals.
On-going
13. Evaluate a proposed geothermal project being considered by NCPA, including
a pre-pay option and the benefit, costs, and risks of a pre-pay structure.
June 2011
14. Conduct a Request for Proposal for eligible renewable resources including
RECs and evaluate alternative renewable resource technologies and
contracting mechanisms.
RFP in June
2011
4. Local Generation – Promote and facilitate the deployment of cost-effective local
resources by:
a. Using the renewable market price referent (MPR) adjusted for time of day factors and
location as the avoided cost when evaluating cost effectiveness of local resources;
b. Considering energy delivery cost uncertainty and strategic value options when
evaluating opportunities;
c. Evaluating a Feed-in-Tariff to promote locally sited renewable resources;
d. Evaluating cost-effective energy storage resources; and
e. Evaluating the feasibility of developing a 25 to 50 MW generating facility connect to
the City’s distribution system.
Proposed Implementation Plan Items for Strategy #4 – Local Generation Estimated
Completion
15. Provide an update of past local generation feasibility studies and actions to
UAC and Council
Dec. 2010
16. Assess the potential for and feasibility of small local distributed and non-
distributed, renewable and cogeneration projects, including using a FIT to
encourage these projects.
Jan. 2011
17. Assess the potential, benefits and costs of developing and/or joint ownership
of a 25 to 50 MW gas-fired power plant located in or near Palo Alto to meet
load, reliability and local capacity needs.
Jun. 2011
18. Evaluate the City’s PLUG-In Program to encourage cogeneration including
rules, regulations, and buy back rates and recommend modifications as
needed.
Dec. 2011
19. Following receiving Council direction from Implementation Plan Initiative
#10, develop a FIT proposal including rate, rules, regulations, standard
contract form and limits.
To be
determined
20. Assess the economics and potential of the anaerobic digester as a local
generation resource for CPAU
Sep. 2011
21. Assess the need for and value of energy storage to support local renewable
distributed generation resources. Determine any appropriate energy storage
targets to be achieved by December 31, 2016, and December 31, 2021.
Report back to the Council regarding what procurement targets, if any, are
deemed to be appropriate so that the Council may adopt such procurement
targets, if determined to be appropriate, by October 1, 2014.
Jun. 2012
Page 4 of 5
5. Climate Protection – Reduce the electric portfolio’s carbon intensity by:
a. Supporting the City municipal government’s climate protection goals;
b. Promoting the use of technologies (e.g. incentives for cogeneration systems,
promotion of EVs, in-home energy displays) and programs that will reduce the
community’s carbon footprint at a cost of up to the City’s value of carbon;
c. Continuing to offer a renewable resource-based retail rate for all customers who want
to voluntarily select an increased content of non-hydro renewable energy; and.
d. Evaluating quantitative goals for possible future implementation.
Proposed Implementation Plan Items for Strategy #5 – Climate Protection Estimated
Completion
22. Promote the City’s Plug-in program to encourage development of
cogeneration systems.
On-going
23. Analyze electric vehicle (EV) charging patterns and evaluate rates to incent
nighttime EV charging.
Jun. 2011
24. Meet AB32 mandated annual reporting requirements to California Air
Resources Board on annual volumes of electricity purchases by resource.
Annually,
next in Jun.
2011
25. Track and report annually on 6 major greenhouse gas emissions (CO2, CH4,
N2O, SF6, HFCs, PFCs) for all of the City’s municipal operations and
calculate electric portfolio’s overall emissions coefficients (lbs of CO2, CH4,
and N2O per MWh of purchases).
Annually,
next in Sep.
2011
26. Evaluate the costs, benefits and impacts of the implementation of an electric
portfolio carbon neutral policy and the setting of quantitative goals (e.g.
carbon intensity, total GHG emissions).
Jan. 2012
27. Evaluate PaloAltoGreen program design and recommend modifications, as
appropriate, including constructing PaloAltoGreen to assist in meeting
Renewable Portfolio Standard goals.
Jun. 2012
6. Hydro Resource Management – Actively monitor and manage cost uncertainty related
to variations in hydroelectric supply and maximize value of hydro resources by:
a. Planning for an average hydro year on a long-term basis;
b. Utilizing cost effective hydro resource management products; and
c. Implementing opportunities to maximize benefits and reduce costs of the Western
Base Resource and Calaveras hydroelectric resources.
Proposed Implementation Plan Items for Strategy #6 – Hydro Resource
Management
Estimated
Completion
28. Evaluate potential rate adjustment mechanisms that would adjust electric rates
based on hydrologic year type and develop a recommendation for a rate.
Apr. 2011
29. Assess the value related to Palo Alto’s participation in the CAISO’s Metered
Subsystem Agreement and the use of the Calaveras hydroelectric project for
load following.
On-going
30. Identify long-term opportunities to maximize the value of the Calaveras
hydroelectric project as an energy storage resource.
On-going
Page 5 of 5
Proposed Implementation Plan Items for Strategy #6 – Hydro Resource
Management
Estimated
Completion
31. Work with NCPA to seek opportunities to increase the efficiency of the
Calaveras hydroelectric project and implement operational value maximizing
strategies.
On-going
7. Market Price Exposure Management – Actively monitor and manage operational,
counterparty and wholesale energy price risk in the short-term (up to three to five years)
by:
a. Maintaining an adequate pool of creditworthy suppliers; and
b. Diversifying supply purchases across commitment date, start date, duration, suppliers
and pricing terms in alignment with rate stability objectives and reserve guideline.
Proposed Implementation Plan Items for Strategy #7 – Market Price
Exposure Management
Estimated
Completion
32. Evaluate a block purchase of up to 25 MW to meet base load needs for Jan-
Mar and Nov-Dec for a term of up to 5 years.
Feb. 2011
33. Conduct an RFP for new electric master agreement counterparties. Dec. 2011
34. Explore opportunities with NCPA, other municipal utilities and/or third party
suppliers to reduce scheduling and/or operating costs.
On-going
35. Continue to implement a 3-year laddering strategy to manage market price
uncertainty.
On-going
8. Transmission and Reliability – Pursue the reliability of supply at fair and reasonable
transmission and delivery costs by:
a. Actively participating through collaborative efforts with other entities, in local,
regional, statewide and federal regulatory and legislative forums;
b. Participating in transmission and reliability market design forums to ensure that
adopted market designs result in adequate reliability, workably competitive markets
and equitable cost allocation;
c. Evaluating interconnection options to the City to increase service reliability and lower
delivery costs; and
d. Exploring transmission opportunities and strategies to meet long-term renewable
portfolio objectives beyond 2020.
Proposed Implementation Plan Items for Strategy #8 – Transmission and
Reliability
Estimated
Completion
36. Investigate transmission connection voltage upgrade from 115 to 230 kV, and
the potential for a transmission reliability connection to west side.
On-going
37. Explore transmission opportunities and strategies to meet long-term renewable
portfolio objectives beyond 2020.
On-going
38. Evaluate joint efforts for power plant ownership opportunities or long-term
agreements to meet the City’s Resource Adequacy Program requirements.
On-going