REPORT TO COUNCIL
SUBJECT
Title
Action to Authorize the City Manager to Complete Negotiations and Execute an Amendment to the Renewable Energy Purchase and Sale Agreement with Energia Sierra Juarez U.S., LLC, to Purchase Renewable Energy from the Cimarr?n Wind Project
Report
COUNCIL PILLAR
Deliver and Enhance High Quality Efficient Services and Infrastructure
Promote Sustainability and Environmental Protection
BACKGROUND
The City of Santa Clara's Electric Department, Silicon Valley Power (SVP), purchases energy to supply residents and businesses within the City of Santa Clara. With the passage of Senate Bill 100 (SB 100), SVP must meet the State of California Renewable Portfolio Standards (RPS) where SVP must procure a specified percentage of its retail sales from renewable energy resources by a particular year.
SB 100 requires local publicly owned electric utilities, like SVP, to procure minimum quantities of electricity products from eligible renewable energy resources: (1) 44% of retail sales by December 31, 2024; (2) 52% of retail sales by December 31, 2027, and (3) 60% of retail sales by December 31, 2030.
To meet this mandate, SVP has diligently sought out renewable energy projects and, over the years, the City Council has approved wind, solar, hydro, and geothermal projects. On June 7th, 2022, the City Council authorized the City Manager to negotiate, approve, and execute a Renewable Energy Purchase and Sale Agreement (Agreement) with Energia Sierra Juarez U.S., LLC (Energia Sierra Juarez), for 300 MWs of renewable energy from the Cimarr?n Wind Project located in Baja California, Mexico. In October 2022, the City and Energia Sierra Juarez, finalized and executed this Agreement.
In September 2023, Energia Sierra Juarez notified SVP that delays in the issuance of major permits by Mexican government agencies led to the expiration of their supply and construction agreements resulting in significant cost increases. Based on these cost increases and o...
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