WEBINAR FOR BUSINESSES | 1 Introduction and Update for Prospective Business Customers Wednesday, November 4, 2015 11:00 am - noon.

WEBINAR FOR BUSINESSES | 1

Introduction and Update for Prospective

Business CustomersWednesday, November 4, 2015

11:00 am - noon


Webinar Objectives

• Provide an update on the Silicon Valley Community Choice Energy Partnership, current development efforts and next steps

• Offer a primer on Community Choice Energy, and what it means for commercial energy customers

• Engage prospective business customers and key commercial stakeholders


Community Choice Energy - Context

IOUInvestor-Owned

Utility(e.g. PG&E)

CCECommunity Choice

Energy(e.g. Marin Clean Energy)

MuniMunicipally-Owned

Utility(e.g. CPAU/Palo Alto)


Business Customers and Impact

64%


Speaker Introductions

Shawn Marshall, LEAN U.S.

Founder and Executive DirectorLocal Energy Aggregation Network, U.S.

Don Bray, Joint Venture Silicon Valley

Executive Director, Energy Initiatives

Melody Tovar, City of Sunnyvale

Regulatory Programs Division Manager, City of Sunnyvale

SVCCEP Project Team Lead

http://www.bing.com/images/search?q=logo+city+of+sunnyvale&id=B088349B7763D2435A694DFD45CC118298EB62AB&FORM=IQFRBA


Today’s Agenda

11:00am

Introduction and Overview Don Bray, Joint Venture Silicon Valley

11:05 Introduction to the Silicon Valley Community Choice Energy Partnership

Melody TovarCity of SunnyvaleRegulatory Programs Division Manager

11:15 Primer: Community Choice Energy• Regulatory history• How does CCE work?• Where has this been done, and with

what results?• How is energy procured and priced?• What are the costs and savings?

opportunities? risks?

Shawn MarshallLEAN Energy U.S.Executive Director

11:40 Summary of Questions Frequently Asked by Commercial Energy Customers

Don Bray

11:45 Moderated Audience Q&A Shawn Marshall, Melody Tovar, Don Bray

11:55 Next Steps and Key Resources Melody Tovar, Don Bray


What is Community Choice Energy?


What is Motivating CCE?

• Communities adopting Climate Action Plans for Greenhouse Gas Reduction

• Transportation and Electricity Consumption are largest community contributors of GHG

• Transforming ElectricitySourcing is essential to reaching goals


Major companies in the area have similar motivations:

1)

2)

4)

5)

12)

18)

23)

2015 National Top 100

Intel

Microsoft

Apple

Google

Cisco

Equinix

Lockheed

100% of EnergyfromRenewables

http://www3.epa.gov/greenpower/index.htm


Introducing SVCCEP - Silicon Valley Community Choice Energy Partnership

Mayor Jim Griffith

Mayor Rod Sinks

SupervisorJoe Simitian

Mayor John McAlister

Sponsoring Agencies . . .


SVCCEP Priority Goals

• Offer renewable energy supply options that exceed the renewable content offered by IOU.

• Reduce GHG emissions to support local climate action goals.

• Provide competitive, potentially lower, electricity rates for all customers.

• Facilitate the use of clean technology, local clean power, and other energy innovations.

• Create and maintain a local public agency that is well managed and financially sustainable.


Interest has Grown

Sunnyvale

Mountain View

Unincorporated Santa Clara

Cupertino

Campbell

Gilroy

Los Altos

Los Altos Hills

Los Gatos

Monte Sereno

Morgan Hill

Saratoga

68%

32%

Electricity Usage by Community4 Million MWh Total


SVCCEP Milestones and TimelineWe are Here

Phase 1 Phase 2 Phase 3

INITIAL STUDY TECHNICAL FEASIBILITY

CCE PROGRAM DEVELOPMENT

CCE LAUNCH

ID potential agency partners

ID opportunities, costs, and risks

Investigate other CCEs Inform community and

gather feedback Framework for next

steps

ID partners & funding Technical Study: load

and rate analysis, economics, supply options, environmental outcomes

Community outreach & input

JPA Formation Expand Outreach Energy Svcs Pricing and

Procurement Enabling Ordinance Implementation Plan to

CPUC Agmt with PG&E Bridge financing to

revenue

Staffing and Org setup Energy and other

Service Contracts Customer notifications

and service Conservation &

Renewables programming

Fall 2015Technical Study Completed

Winter 2015Communities Decide JPA

Spring 2016Implementation Plan to CPUC

Winter 2017Program Launch!

Summer 2016Ramp-up Operations and Communications


Today’s Agenda

11:00am Introduction and Overview Don Bray, Joint Venture Silicon Valley



11:15 Primer: Community Choice Energy• Regulatory history• How does CCE work?• Where has this been done, and

with what results?• How is energy procured and

priced?• What are the costs and savings?


Shawn MarshallLEAN Energy U.S. Executive Director


Don Bray




Authorized by CA Assembly Bill 117 in 2002

CCEs in 7 States• California• Illinois• Massachusett

s• New Jersey• Ohio• Rhode Island• New York

Under Consideration:Utah, Delaware, Minnesota

Community Choice Energy in the U.S.


History in California

• Authorized by AB 117 (Migden, 2001)

• Expanded by SB 790 (Leno, 2011) Also required CPUC to open Rulemaking to adopt a Code of Conduct,

associated rules, and enforcement procedures, to govern the conduct of an electrical corporation relative to the CCAs

D. 12-12-036

• Community Choice operating in: Marin County and neighboring jurisdictions Sonoma County City of Lancaster

• Now under study in numerous additional jurisdictions


Expansion in CA


State Law Elements of CCA Service

• Local governments participate by passing an ordinance and joininga Joint Powers Agency (JPA)

• Utility (PG&E) continues to provide consolidated billing, customer service, power line and grid maintenance

• CCA becomes default electric provider; Customers receive minimum 4 opt-out notices over 120 days, can return to PG&E service at any time.

• New CCA agencies register with CPUC, submit Implementation Plan

• Service Agreement with PG&E codifies CCA/utility operating relationship


How is a CCE operated and governed?• Proposed as a Joint Powers Agency of multiple municipal

members

• Key Functions of the JPA: o Power procurement/development o Rate design and settingo Legal/regulatory compliance o Ancillary energy programso Customer engagement

• JPA Agreement specifies terms of municipal membership

• Governance proposed as one elected representative from each member city/county, plus alternate

• The Board meets monthly in a public setting. The Board sets JPA direction, approves procurement strategy and power contracts, sets rates and provides organizational oversight

• Specifically qualified staff run daily operations


How is CCE visible to customers?

SCP Generation Charge


What offerings are available to CCE customers?

Launch Year Power Supply Options

2010 “Light Green” - 50% Renewable “Dark Green” - 100% Renewable

“Sol Shares” - 100% Local Solar

2014 “Clean Start” - 36% Renewable

“Evergreen” - 100% Renewable

2015 “Clear Choice” - 35% Renewable

“Smart Choice” - 100% Renewable


Customer offerings are sourced to meet specific goals.

PG&E CleanStart EverGreen0%

10%20%30%40%50%60%70%80%90%

100%

2736

100

UnspecifiedNuclearNatural GasLarge HydroRenewable8

24

21

21 20

44

Electric Power Generation Mix*PG&E – Sonoma Clean Power Comparison

*The generation data represents 2014 and is provided in the “Annual Report to the California Energy Commission: Power Source Disclosure Program,” excluding voluntary unbundled renewable energy credits. PG&E data is subject to an independent audit and verification that will not be completed until October 1, 2015. The figures above may not sum up to100 percent due to rounding.


PG&E Sonoma Clean Start Sonoma Evergreen0

50

100

150

200

250

300

350

400

450

500

445

294

70

CO2 Emissions, lbs/MWh

Goals include reducing carbon emissions from electricity generation.

Poun

ds

per

Megaw

att

-Hour

2013 PG&E / 2014 SCP Data

427


Generation Rate PG&EMCE

Light GreenMCE Deep

Green

E-1 (residential) $0.097 $0.082 $0.092A-1 (small commercial) $0.102 $0.082 $0.092E-19S (large industrial) $0.099 $0.081 $0.091

AG-1A (agricultural) $0.103 $0.093 $0.103

PG&ESCP

Clean StartSCP

Evergreen

E-1 (residential) $0.097 $0.071 $0.106A-1 (small commercial) $0.102 $0.076 $0.111E-19S (large industrial) $0.099 $0.077 $0.112

AG-1A (agricultural) $0.103 $0.081 $0.116

CCE Generation Rate Comparison(Per Kwh; As of May 2015)


Anticipated Rate Savings in the Near Term

Illustrative Rate Comparison

Sonoma Clean Power2015 Commercial

Com-1/A-1, 1500 kWh


Anticipated Rate Savings in the Near Term

Illustrative Rate Comparison

Sonoma Clean Power2015 Commercial

A-10, E-19 Examples


CCE Investment in Local Energy Development – Innovation and Opportunity

Solar on a Brownfield Floatovoltaics

Energy Efficiency Battery Storage


The timing for CCE formation is good.

Market Conditions/Utility Rate Trends

• Wholesale power and natural gas prices are at historic lows.

• Utilities are fully resourced through 2020 and thus excess power is available.

• Affordable financing available due to low interest rates.


CCE programs are demonstrating sound fiscal performance.

Marin Clean Energy (MCE) and Sonoma Clean Power (SCP) •Provide greener energy at competitive rates•Provide enhanced energy programs•Are fiscally sound MCE (Draft FY15-16) SCP (Draft FY15-16)

Total Revenue $146M $165M

Expenses $141M $149M

Cost of Energy $129M $130M

Cost of Administration 4% 3.5%

Net Increase in Reserves $4.5M $16.9M

v


Risks exist but can be mitigated.

Risks related to CCE

• Financial risk

• Competitive and pricing risk/opt-out rates

• Market exposure

• Regulatory risk

• Political risk Assessment Report analyzes these risks andoutlines potential risk-mitigation measures

Effecton

Business

Probability

of Event


Summary – Business Value Proposition

• CCE adds additional choices and opportunity for C&I customers

• CCEs established today should be able to compete on costs for the foreseeable future

• CCEs provide cost-effective renewable energy and reduction of Scope 2 GHG emissions

• CCE revenue can fund local private/public partnership activity, e.g. Feed-In Tariffs, PEV Infrastructure, Demand Response, Energy Conservation, Storage

• Great opportunity for local pilots and innovation


Today’s Agenda







Shawn MarshallLEAN Energy U.S. - Local Energy Aggregation NetworkExecutive Director


Don Bray




Some Business FAQs• What energy options are available to commercial customers?

• Would service reliability be affected?

• How are Direct Access customers affected?

• What do commercial rate schedules look like?

• What elements of the utility bill are affected? Not affected?

Demand Charges?

Fees?

NEM?

• How are rates set? When?

• What steps are required to become a customer of the CCE entity?


Today’s Agenda







Shawn MarshallLEAN Energy U.S. - Local Energy Aggregation NetworkExecutive Director


Don Bray




Next Steps

Technical Study & Program Development

Stakeholder Engagement

Agency Agreement & Preparation


Technical Study Scenarios

1. Match PG&E GHG-free content and start at 35% Renewable Portfolio Content

2. Exceed PG&E content, starting at 50% RP escalating to 75% by 2030, and ensure that GHG remains 20% below PG&E

3. Maximize GHG-free and RP content, while achieving rate parity with PG&E Include 100% RP voluntary program in all scenarios

Utilize Product Content Category 1, 2 split of 75%/25% in all scenarios


Decision Making

• 12 partners

• Council/Board action- Adopt CCE Ordinance- Resolution to join JPA;

approve final agreement- Approve cost-sharing contribution

• Target – action by March 31, 2016- Council preparatory info by December 9, 2015- First JPA meeting in April 2016


Community Engagement

• Community Meetings – 12 minimum

• Targeted Stakeholder Forum November 17th in Sunnyvale

• Business Engagement Website – e-mail updates, comments

Business Forum Meeting – December

Business Groups, Chambers

• Grows in next phase

• Customer Noticing 60 days before service


www.SVCleanEnergy.org


Thank you.

WEBINAR FOR BUSINESSES | 1 Introduction and Update for Prospective Business Customers Wednesday, November 4, 2015 11:00 am - noon.

Documents