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HomeMy WebLinkAbout2025-11-20 Climate Action and Sustainability Committee Summary MinutesCLIMATE ACTION & SUSTAINABILITY COMMITTEE SUMMARY MINUTES Page 1 of 10 Special Meeting November 20, 2025 The Climate Action & Sustainability Committee of the City of Palo Alto met on this date in the Community Meeting Room and by virtual teleconference at 2:00 p.m. Present In-Person: Veenker (Chair), Burt, Lu Present Remotely: None. Absent: None. Call to Order Chair Veenker called the meeting to order. The clerk called roll and declared a quorum. Public Comments 1. David S. spoke about the City's carbon neutrality goal as it related to private auto electrification and specifically EV chargers. David S. mentioned a project at 391 Oxford Avenue in Palo Alto, where the goal was to bring power from a home to a detached garage area. The project had 2 options: to run the power above ground, which costed $8,000 and was visible; or run the power underground, which costed $18,000. The national electrical code and California electrical code specified that a rigid metal conduit only needed to be buried 6 inches below grade, but the Palo Alto code specified it had to be buried 30 inches below grade, significantly increasing the cost. David S. was concerned about code obstacles to electrification. 2. David C. noted there were new homes being built with gas hookups. David C. believed those having the gas hookups installed should pay the full price to decommission the gas line up front. David C. suggested charging more than the decommissioning cost as a way to dissuade the use of gas. David C. mentioned that most new homes have installed a 400-amp service. David C. thought that was unnecessary and proposed charging people an extra cost up front for the excess electricity. Standing Verbal Reports A. Staff Comments Director Brad Eggleston gave updates on the recent round of statewide incentives for heat pump water heaters. Over 100 Palo Alto residents signed contracts to install a water heater during round 3 through a combination of full-service emergency and rebate programs. Director Eggleston highlighted the heat pump water heater giveaway program, in which 24 residents installed heat pump water heaters to join the contest. There were 40 residents that attended the heat pump SUMMARY MINUTES Page 2 of 10 Climate Action & Sustainability Committee Special Meeting Summary Minutes: 11/20/2025 happy hour on October 23. Director Eggleston explained the refer-a-neighbor promotion, in which residents that had completed a heat pump water heater installation were eligible to earn $50 per referral and the referred neighbor could receive $100 after completing an installation. As of 1 week ago, 14 customers had signed up as new referrers and 2 sign-ups were referred customers. City staff had received emails with concerns about solar and battery permit fees. In the FY2026 budget, the City implemented a new cost of service study which inadvertently did not adjust some fees subject to state statutory caps. Staff will work on a solution. The topic will return to Council in early 2026 for discussion. The City of Palo Alto was awarded the gold-level designation by the national Charging Smart program. B. Committee Member Comments and Announcements Council Member Burt had requested to develop a spreadsheet of friction points in programs as a systematic way to address and prioritize all the issues. Council Member Burt wondered why the solar and battery permitting fees were so high, regardless of State limits. Council Member Burt opined that fee structures could be dis-incentives to adoption. Council Member Burt questioned why the latest Reach code requirements were not having the anticipated outcomes regarding gas hookups on new homes. Council Member Burt asked if the increase in 400-amp services on new homes will be a problem for the City's grid. Council Member Burt proposed a business advisory council to bring the business community into the efforts. Council Member Burt wanted the community and City's identity of being leaders in innovation and sustainability to be an essential core value in the business community. Council Member Burt queried how the Committee could make a recommendation for that to occur. Director Brad Eggleston explained that staff will bring a draft workplan in early January for the Committee to review and make a recommendation. Chair Veenker asked if staff could confirm the observations of 400-amp installations. Chair Veenker liked the idea of integrating the business community, as many big companies had Chief Sustainability Officers. Chair Veenker reported that the Northern California Power Agency was recruiting a new general manager and had selected Korn Ferry as the recruiting firm. The next quarterly legislature and regulatory committee for the CPA will be in early December. The Air District approved recommending to the Board $23M in charge grants for EV infrastructure, although the demand was outpacing the infrastructure. The State budget's new projected structural deficit was $18B due to the bullish stock market. Chair Veenker recalled Al Gore's observation that private capital was a way to solve climate problems. Of the new energy installed worldwide last year, 93 percent was renewable and 75 percent was funded by private investors, however only 2 percent was in Africa. Chair Veenker noted the interest in addressing the energy needs for AI technology. Assistant Director Jonathan Abendschein said that about one third of people were putting in new gas lines, which was mostly for stoves, and a small minority of people were doing 400-amp panel upgrades. Council Member Burt wanted staff to look at the latest numbers of 400-amp panel requests to see if there was a correlating trend between the increase of requests and the City's push for home electrification. Agenda Items SUMMARY MINUTES Page 3 of 10 Climate Action & Sustainability Committee Special Meeting Summary Minutes: 11/20/2025 1. Status Update on Sustainability and Climate Action Plan Mobility Goals and Key Actions and Request for Feedback on Tentative 2026-2027 Work Plan Items. CEQA Status - Not a project. Senior Planner Katie Heuser said there were 3 objectives for the presentation: to provide a status update on the mobility goals and key actions; to share planned and potential 2026-2027 S/CAP Work Plan Mobility work items; and to seek Committee feedback on work items. The City had two Mobility Goals: to reduce the total vehicle miles traveled (VMT) by 12 percent by 2030 compared to the 2019 baseline and to increase the mode share for active transportation and transit from 19 percent to 40 percent of local work trips by 2030. There had been at least a 25 percent reduction in total VMT in 2023 compared to 2019, largely due to the pandemic. Mode share remained around 20 percent. Challenges with VMT measurement included the City's lack of access to detailed monitoring of every vehicle entering and leaving Palo Alto and its origin, destination, and type. The S/CAP used 2 different models to estimate VMT: the Valley Transportation Authority (VTA) model, used in 2019, and Google's Environmental Insights Explorer (EIE), the current model. Google's EIE estimate was lower than the VTA model. Google's EIE had not published 2024 data nor communicated why or the timeline for release. Staff was exploring alternatives. A slide showed a table of long-term and short-term OOT work items. There were 5 main Work Plan Items for the 2026-2027 S/CAP Work Plan, which pursue reducing VMT and raising the percentage of local commutes using active transportation. The 5 main items were in line with the approved operating and CIP budgets for the OOT. The 5 items were: to achieve benchmarks for bike/pedestrian projects; to implement recommendations included in the micromobility feasibility study; to develop a parking pricing policy, which will yield revenue; to maintain and modernize traffic signals to improve multimodality; and to implement goals, policies, and programs in the Housing Element. A slide showed a table of potential additional work items, which would require reprioritizing items on the prior slide or additional staff or funding. Column 2 on the table identified what additional staffing or non-salary funds would be needed to advance the items. Tasks included advancing or accelerating work with additional full-time staff, expanding transit services, developing a tool to better understand mobility needs, transportation demand management, and education or programming for adult cyclists and pedestrians. Staff presented the slide deck to the Climate Action Working Group yesterday. Staff received comments regarding the value of quantifying potential VMT reduction and that telecommuting policies were in flux. Suggestions included a focus on bicycling infrastructure, such as separated bike lanes, to create a more comfortable environment. There was a discussion around the benefits of more people living in Palo Alto. There was general support for expanding transportation demand management services; for example, Stanford employees were paid not to drive. There was a discussion about wanting staff to consider on-demand micro-transit, such as self-driving shuttles. Council Member Lu asked what the baseline year was for the mode share and if that was based on census data for Palo Alto residents. Council Member Lu asked if working from home was factored into the mode share calculations. Council Member Lu questioned if the census data was detailed about modes of transportation, such as cycling versus walking versus taking a train or bus, and if there was anything noteworthy. Council Member Lu opined having the extra context on the mode share would be useful for a deeper evaluation of the plan and proposed items. Senior Planner Heuser said the baseline year for the mode sharing was 2019 and the census only looked at Palo Alto residents and the commute, which may be outside the City. SUMMARY MINUTES Page 4 of 10 Climate Action & Sustainability Committee Special Meeting Summary Minutes: 11/20/2025 Transportation Planning Manager Sylvia Star-Lack said staff had a conversation regarding how to capture the data and noted staff tried to keep the KPIs as simple as possible. Assistant Director Jonathan Abendschein confirmed telecommuting was not included in the mode share calculations and the number of work trips had declined while the percentage of mode share for those work trips stayed the same. Chief Transportation Official Ria Lo explained that some trends came from the census while some came from other sources. There was still a rebound in the number of trips, some of which were longer. The absolute numbers of trips were lower but the mode share was going the opposite direction because there was less transit commuting. The VTA recovered well but was still not at pre-pandemic levels. Caltrain had made substantial improvements since electrification. Council Member Burt opined that major breakdowns in the data would be informative. Council Member Burt said the 80 percent reduction goal was based on the 1990 baseline and asked what was used to come up with the 1990 GHG baseline. Council Member Burt questioned if the GHG levels for 1990 had any breakdown on mobile versus stationary sources and if there was a VMT. Council Member Burt acknowledged the 1990 numbers were less reliable than the 2019 numbers due to improvements in measurement abilities. Council Member Burt referenced Table 1 and said there was close to a 40 percent decline in the VMT, but the GHGs only reflected a 25 percent decline. Council Member Burt asked why there was a large discrepancy in the percentages. Council Member Burt queried if staff thought that Google EIE was more accurate. Council Member Burt asked how staff came up with the 293,413 GHG number. Council Member Burt clarified that, if the GHG for 2019 was adjusted higher to include data for medium- and heavy-duty vehicles, then the actual decline would be closer to 40 percent rather than 25 percent. Council Member Burt opined the percentage decline discrepancy should be reconciled as it was a large contributing factor to the City's overall goals. Council Member Burt said the decline in the GHG levels appeared similar but because the EIE numbers were not reliable in 2019, there was uncertainty as to what the actual numbers were. Council Member Burt clarified that ultimately, staff would have to make best assumptions on the 1990 and 2019 data. Council Member Burt wanted the assumptions to be transparently presented. Council Member Burt asked if the EIE was discussed with the Committee and if the EIE had origin and destination data. Google EIE was free. Council Member Burt queried what the City paid for the Fehr and Peers study. Council Member Burt referenced Table 2 and asked how rail grade separations would reduce VMTs and noted that vehicular grade separations reduced traffic congestion and increased vehicular travel. Council Member Burt questioned how traffic calming would translate to VMT reduction and clarified traffic calming would promote mode shift. Council Member Burt was skeptical that a shared micromobility system would be successful in Palo Alto. The post-Covid fixed rail transit use was down across the Bay Area, however Caltrain had seen recovery exceed projections. Hybrid work and a slow economy meant fewer people were going to work. Council Member Burt opined that traffic congestion drove transit use. Chair Veenker acknowledged the VMT was important because it could be influenced but noted the level of GHGs fell to about the same amount in either mode. Reducing the GHG levels was the ultimate goal. Chair Veenker appreciated the directionality but wanted more concrete numbers to help craft a policy that understood the VMT, if possible. Manager Christine Luong confirmed some goals had a 1990 baseline but the baseline for the mode shift specifically was 2019. Manager Christine Luong said the 1990 baseline included all categories in the GPC SUMMARY MINUTES Page 5 of 10 Climate Action & Sustainability Committee Special Meeting Summary Minutes: 11/20/2025 methodology, such as on-road transportation, off-road transportation, Caltrain transportation, aviation, etc. Staff did not have the mode shift breakdown. The earliest VMT data staff had was from 2015. The reason the City switched to Google EIE was because Google switched the entire methodology to follow the GPC methodology. The VTA model that Fehr and Peers used was $15,000. Assistant Director Abendschein explained there had been a lot of evolution in how to measure VMT and emissions from VMT, even since 2019. Staff focus in the last few years was to improve measurement methodologies. The inconsistency between the VMT decline and the GHG decline was partly due to the improvements in measurement methodologies. The Fehr and Peers study was an estimate based on the County-wide transportation model and Google EIE was in beta mode in 2019 and had a lot of errors. There was a lot of uncertainty around the 2019 numbers. The VMT measurement and ability to access vehicle data to estimate emissions from different vehicle types had varied widely. Assistant Director Abendschein emphasized the broad directionality of significant decreases in VMT from 2019 to 2023. Staff did not believe the EIE was more accurate in 2019 but the current EIE was more accurate. The 293,413 GHG number from 2019 would be lower than expected for that level of VMT if the data took into account medium- and heavy-duty vehicles. There would be higher GHG levels for that amount of VMT if vehicle types were taken into account. The 2023 data took those into account. The Fehr and Peers model had a lot of uncertainty. The decline could be closer to 40 percent or 20 percent; there was a wide margin for error. Assistant Director Abendschein agreed with the desire to have an agreed upon baseline, however there was a lot of uncertainty around vehicles entering and leaving Palo Alto during 2019 and 1990. Staff had estimating methodologies. The focus was to improve those methodologies in order to have good tracking data going forward. Staff was having issues getting the latest EIE data, which will be released. If staff was able to continue to use the EIE data, then staff could look back and determine which uncertain methodology to use as the baseline. Director Brad Eggleston said staff did not have information on the 1990 baseline at the time but would look back to understand what the basis was. The EIE was discussed with the Committee before it became a Brown Act Committee. Chief Transportation Official Lo explained that grade separations helped reduce VMT by addressing the issue of electric connected active transportation. The City hoped to redo the traffic calming process to respond to community input on pedestrian and bicycle concerns, such as reducing speeds. Transportation Planning Manager Star-Lack agreed that micromobility may not be impactful but Stanford Research Park asked the City to be included. Senior Planner Heuser said the micromobility feasibility study was due to the realization that Palo Alto may not be suitable for shared bikes and scooters. Findings showed it will be most successful in areas like downtown and Cal Ave. The inclusion of the Stanford campus and shopping center will contribute to its success. Chair Veenker referenced the current OOT work items list on slide 5 and asked how using Palo Alto Link would reduce VMTs. Chair Veenker clarified that Link or Uber does not reduce VMTs but encourages other ancillary trips to be made on public transit or with another public mode. Chair Veenker referenced the 2026-2027 workplan items and questioned how the traffic signal upgrades and timing efforts would reduce VMTs. Chair Veenker clarified the upgrades would be optimized for bike and pedestrians versus vehicles. Chair Veenker asked if there was an ongoing effort to ensure bike lanes were wide enough for 3-wheelers. SUMMARY MINUTES Page 6 of 10 Climate Action & Sustainability Committee Special Meeting Summary Minutes: 11/20/2025 Council Member Burt was skeptical that utilizing Palo Alto Link would reduce VMTs as much as in other cities, like San Francisco. Chief Transportation Official Lo explained the shuttle was cost prohibitive. Palo Alto Link would reduce VMTs by enabling people to live a car-free lifestyle and was expected to be used in conjunction with public transportation. Chief Transportation Official Lo said that optimizing the flow of roadways would reduce GHGs and there would likely be signal priority given to bikes and pedestrians. Transportation Planning Manager Star-Lack said the signal timing on Bryant through Downtown had been optimized for bicycle travel. Staff tried to get the widest bike lanes possible. Item 1 Public Comment 1. David C. wanted to prioritize bike plan projects based on GHG reductions. David C. did not want the City's work-from-home policies to relax and cause a loss of gains in the GHG and VMT reductions. David C. suggested a rent-to-own program to promote e-bikes. E-bike trials had an 85 percent conversion to ownership. David C. proposed holding an e-bike expo but cautioned against the promotion of throttle- only e-bikes. David C. opined that updating the comp plan so that street closures could occur would help traffic calming. 2. Ken K. recommended the City evaluate any micromobility proposals using a GHG reduction per dollar KPI and a safety improvement per dollar KPI. Peer city data showed that the City needed to support 1 to 3 FTE employees to get a modest GHG savings, such as Boulder. Cambridge in the UK had a successful micromobility program due to its large scale. Small-scale programs had only 10 to 20 percent of trips replace a car or ride hail; the majority of trips replaced walking or transit. Ken K. opined that other programs should be considered. Ken K. suggested investing in a micromobility voucher program or lending library. If the City implemented a shared micromobility program, the contract should be long- term to prevent the service provider from exiting. Council Member Lu liked the capital project items but opined micromobility could become a significant distraction and that staff would need to pay attention to data and practices. Council Member Lu was concerned that increasing the parking cost would not be impactful due to excess parking. Council Member Lu asked for more information on the parking and price management item. Council Member Lu believed parking enforcement was a good way to manage VMT, safety, and mode shifts. Council Member Lu supported changes in parking color zones. Council Member Lu opined that transit signal priorities for bikes and pedestrians would be the most impactful and asked if staff knew how many streets could accommodate traffic signal priorities. Council Member Lu felt that good execution on the bicycle and pedestrian capital projects would be the most impactful. Council Member Burt opined that now was not the time to implement parking changes due to the low demand. Council Member Burt believed increasing long-term parking permits would develop a sustainable funding source for TMA. Council Member Burt liked the idea of looking at GHG reduction on a per-dollar basis. Council Member Burt thought putting a greater focus on e-bikes, including cargo and 3-wheel e-bikes for seniors, would be impactful. The e-bike expo in 2016 was popular. Council Member Burt recommended using a range for GHG reduction goals. Council Member Burt suggested adjusting the mode shift goal downward but the VMT reduction goal upward. Palo Alto had adopted transit- oriented developments and communities. A high percentage of development in the region was transit oriented, however, since pre-Covid, there had been a decline in transit use, which Council Member Burt SUMMARY MINUTES Page 7 of 10 Climate Action & Sustainability Committee Special Meeting Summary Minutes: 11/20/2025 believed was due to limited access. Council Member Burt asked if the mode share shift only looked at Palo Alto residents or included commuters. Council Member Burt queried if there was a way to get data on the commuters and wanted to identify commuters as a category, even if it was less accurate. Council Member Burt opined the planned improvements on University Avenue would benefit mode shift. About 70 percent of residents work outside of Palo Alto. Council Member Burt believed the premise that new residents would eliminate commuters was false and wanted to do a proper calculation on whether the new residents would commute at similar levels and similar distances. Chair Veenker was concerned about downtown pricing policy changes having unintended consequences for the retail community. Chair Veenker liked the traffic signal timing efforts and the encouragement programs. Chair Veenker believed a sense of safety was a big factor when considering mode shift and that an additional level of security and safety would be needed around e-bikes. Chair Veenker agreed that the mode shift goal may have been too ambitious. Chief Transportation Official Lo said the current parking policy was the color zones, which generated emissions and created safety concerns. Chief Transportation Official Lo did not know how many streets could accommodate bike and pedestrian signal priorities. Senior Planner Heuser did not know how big the parking issue was. Transportation Planning Manager Star-Lack confirmed the mode share shift only looked at Palo Alto residents because of the need for a stable metric. Staff needed a metric that could be tracked year over year. In order to do estimates for incoming and outgoing commuters, staff would have to use the VTA travel model. Transportation Planning Manager Star-Lack was unsure if Google EIE would have the data for commuters. 2. Recommendation that the City Council Accept the “Evaluation of Local Energy Resources to Lower Costs and Improve Reliability and Resiliency” Report to Complete Reliability and Resiliency Strategic Plan Strategies Four and Five, and that the City Council Direct Staff to Pursue Various Activities Related to Flexible Energy Resource and Efficient Electrification to Improve Reliability and Resiliency; CEQA Status - Not a Project Assistant Director Jonathan Abendschein explained the study objective was to evaluate the level of flexible energy technologies and efficient electrification in reducing electric supply costs, deferring distribution system investment, and enhancing short- and long-term resiliency. A slide showed the study timeline. The workplan included a work item to complete the reliability and resiliency strategic plan. There was a general assumption that it was worthwhile to promote technologies for voluntary adoption and to reduce barriers. The Utilities Advisory Commission (UAC) was the primary body focused on the study. Over the summer, this Committee and the UAC reviewed the preliminary study results and provided feedback, which was incorporated into the study. The overall findings were that there was no positive cost benefit based on the savings to utility supply cost and benefits of short-term reliability of technologies. The final study was updated to remove the investment tax credit, which hurt the numbers. There were a few areas for a case-by-case focus. Time of use rates were beneficial. It was worthwhile to promote the technologies, reduce barriers, and provide low-cost technical assistance. Included in the staff recommendation was to come back in 2026 for further discussion on long-term resiliency. Slides showed the updated results for residential and commercial; there were no positive cost benefits. A slide SUMMARY MINUTES Page 8 of 10 Climate Action & Sustainability Committee Special Meeting Summary Minutes: 11/20/2025 showed feedback on the Policy Straw Proposal, all of which was integrated into the recommendations brought to the Committee. A slide showed a graph of technology cost projections. Without the ITC, commercial batteries and solar were forecasted to become cost-effective in the next 5 to 10 years, whereas residential solar and battery would take until 2040 or later. The Working Group was presented with this information and had feedback. There were clarifying questions on the report methodology and comments agreeing with the staff recommendation. There was also a recommendation to continue to focus on adopting efficient electrification technologies and reducing barriers. There were several suggestions, including considering adjusting the staff recommendation so commercial battery-only projects were considered on a case-by-case basis; doing an annual update to the cost-benefit, adjusting only electricity costs; and quantifying long-term resiliency by doing a scenario analysis on direct City savings instead of macroeconomic analysis. Staff asked the Committee to recommend acceptance of the report and ask Council to direct staff to continue to work on reducing barriers, promoting technologies, and looking for case-by-case opportunities. Director Brad Eggleston said this item was planned to go to Council as an action item in early 2026 because it included an item that was pulled from consent regarding the reliability and resiliency strategic plan. Item 2 Public Comment There were no requests to speak. Council Member Lu asked how utility-owned or larger-scale battery storage solutions may apply. Council Member Lu confirmed the short-term reliability benefits were considered but it was a complex issue and the benefits did not scale up well. Council Member Lu encouraged staff to consider ways to make the process easier on a code level. Council Member Burt was encouraged that solar and battery provided a benefit to commercial customers, especially regarding resiliency. Council Member Burt noted the gap between the supply cost benefits for residential customers on slide 6. The majority of residential solar installations included batteries even though there was no economic benefit. Council Member Burt believed that was because households valued reliability. Council Member Burt was unsure if commercial businesses placed the same value on reliability and wanted to get input from the Sustainability Council. Council Member Burt asked how staff derived the estimates for the value commercial businesses placed on short-term reliability. Council Member Burt opined that commercial businesses had subjective and emotional reasonings for solar and battery installation, and that it was not solely based on economics. Council Member Burt was glad to see the airport location was recognized as a possible microgrid and queried if the UAC was briefed on that. Chair Veenker did not see any resiliency benefits included in the residential results on slide 6 and asked why. Chair Veenker believed that long-term resiliency could make up a significant amount of value. Chair Veenker opined that technology promotion and barrier reduction was important but asked for clarification on the collection of things listed under item 2 on the staff report. Chair Veenker referenced page 11, item 4 of the staff report, which mentioned backup power for the Regional Water Quality Control Plant and the airport, and asked for clarification. Chair Veenker liked the idea of having alternative policies that provided incentives for solar and battery microgrids for things such as grocery SUMMARY MINUTES Page 9 of 10 Climate Action & Sustainability Committee Special Meeting Summary Minutes: 11/20/2025 stores. Chair Veenker appreciated income-qualified incentives. Chair Veenker did not want to defer an investment in the grid upgrades. Assistant Director Abendschein pulled up slide 7. Large-scale battery storage solutions were not considered directly but the commercial results for battery-only storage provided insight. A lot of value for large-scale batteries was in the short-term reliability. It would be a challenge to achieve the short- term reliability benefits on a utility-wide scale. The batteries were standalone and did not provide long- term resiliency. There were difficulties when considering the short-term benefits for multiple customers due to complexities with switching and the ability of the battery. There was a cost benefit on the commercial side for battery and solar but businesses wanted a 2-to-4-year payback when investing working capital. Slide 7 showed there was a 15-to-20-year payback for commercial businesses and that financing would be a major factor. Staff included commercial estimates for short-term reliability, indicated by the light green in the chart. Long-term resiliency was not included. The UAC provided feedback on the models proposed by the consultant for the study. The interruption cost estimation (ICE) model was used, which was based on surveys of commercial customers actual studies of impacts of outages on things like productivity, spoilage, etc. The City was well set up to allow people to invest in solar and batteries if desired for the short-term reliability benefit. The UAC received the same briefing as the Committee. The residential resiliency benefits for residential solar and BESS were small but long- term resiliency was not factored in. The amount of people buying solar plus battery was small compared to the total population of Palo Alto. The confusion in the staff report under item 2 was due to a comma, and should have read "vehicle to load, vehicle to home, and vehicle to grid technology." Assistant Director Abendschein explained it was important to look at all backup options for the RWQCP because solar and storage were expensive. Chief Operating Officer Terry Crowley explained that current battery technology was for the short-term and it would become an arbitrage on finance of how to mitigate the resource adequacy cost and shape peak demand. The benefits were not economic based on the financial arbitrage; however, when considering the reliability, the numbers for the benefit-to-cost ratio may change. Architect, Urban Planner, and Policy Analyst Nathaniel Gunderson explained that the ICE model was based on several different mass surveys that estimated the potential impacts of outages over varying durations for residential and commercial. The residential side was based on a willingness to pay. Individual customer characteristics determined the value ascribed to an outage of a certain duration. On the commercial side, those values were assigned based on different types of economic sectors, cost models, and what the hit to revenue would be if an outage occurred where income could not be generated during a certain period of time. The models generated a certain level of uncertainty past the 16-hour mark. After 1 day of an outage, there were other indirect costs distributed throughout the economy that would require more extensive macroeconomic modeling to understand, which was why the long-term estimates were not included. The ICE model was developed by the Lawrence Berkeley National Lab, was peer reviewed, and updated recently. The residential resiliency benefits were small compared to commercial customers because of the higher costs associated with business losses. It was based on data collected through surveys and what people expressed. The emotional factor, such as preference for comfort, was included. The survey data had been tracked for the past 2 decades and had not changed drastically. Director Eggleston explained that the City investigated having a microgrid provide backup power for the RWQCP. The current backup power for the plant was diesel generators, which brought concerns about the length of time to have power and the availability of diesel fuel and capacity to transport it in the SUMMARY MINUTES Page 10 of 10 Climate Action & Sustainability Committee Special Meeting Summary Minutes: 11/20/2025 event of a significant emergency. Staff wanted to take a closer look at the Water Quality Control Plant regardless of the microgrid idea. Council Member Burt clarified there were 2 options in the staff report, the second being a more aggressive approach to promotion. Council Member Burt was interested in pursuing the second option and asked if the funding would come from utilities or the general fund. Chair Veenker noted the report said staff would restrict efforts to .1 to .2 FTE. Assistant Director Abendschein confirmed the alternative option would promote more and required additional resources and discussion. The second option was located in the fiscal impacts section under the second bullet on page 8. It would require a .5 FTE hourly budget and staff would need to find a funding source. Assistant Director Abendschein said the City did not have resources allocated to utility- scale local storage. Motion: Council Member Burt moved, seconded by Chair Veenker that the Climate Action and Sustainability Committee (CASC) recommend the City Council adopt the Staff recommendation and as noted in the staff report, that a .5 FTE funding source would return upon greater evaluation. MOTION PASSED: 3-0 Future Meetings and Agendas The next meeting will be on Friday, December 12, with a plan to review City facility electrification and an update on the Sea Level Rise adaptation plan. There will be a 4-hour workshop on Saturday, December 13, titled "Workshop on Economics of Large-Scale Community Electrification Challenges and Innovative Strategies for the Single-Family Sector." It will be formatted as a workshop to allow more community participation. Adjournment: The meeting was adjourned at 4:27 p.m.