REPORT TO COUNCIL
SUBJECT
Title
Action on Resolution Establishing New Electric Rate Schedules for Large Customers
Report
BACKGROUND
Over the past twenty years, Silicon Valley Power (SVP) has entered into individual electric service agreements (ESA) with large customers. The ESAs have provided a balance of benefits such as longevity and economic development with market-based rates or rate discounts commensurate with the type of service being provided to these large customers. Customers have also sought different rate structures to match either corporate goals or their atypical load profile. On April 3, 2018, City Council delegated authority to the City Manager to negotiate, assign, and/or extend ESAs, as necessary, until January 31, 2019, while new standardized rate tariffs were designed to meet the needs of both the largest-use customer class and SVP.
DISCUSSION
Rather than continue with a process that requires negotiation of individual rates for large customers, SVP is recommending that City Council enact three new alternative rate schedules that each of the fourteen customers with current ESAs, that will be expiring. These new schedules would yield substantially the same average cost of power these customers are paying under their individual agreements. These are alternative rates schedules that will be available for future customers who meet the qualifications for their appropriate rate schedule. These rate schedules are:
Schedule CB-6 Large Combined General Service
Schedule CB-7 Large Combined General Service - Market Based Option
Schedule CB-8 Customer Load Retention
The prices in these rate schedules, as well as various other provisions, are meant to approximate, for each customer with an ESA, the cost of power that would have been incurred had that ESA been renewed or extended. As the current ESAs expire, those customers will be eligible to transition to the appropriate rate schedule. Customers served under these new rate schedules are very lar...
Click here for full text