REPORT TO COUNCIL
SUBJECT
Title
Action on a Power Purchase and Sale Agreement with The Olcese Water District
Report
BACKGROUND
In December 2016, the City Council updated the City of Santa Clara's Renewable Energy Resource Procurement Plan to reflect the changes made to the Public Utilities Code and the Renewable Portfolio Standard Regulations mandated by Senate Bill 350 that required the City of Santa Clara's Electric Department, Silicon Valley Power (SVP), to achieve 33% by 2020 and 50% renewables by 2030. Signed into law in September 2018, Senate Bill 100 (SB 100) accelerated the Renewable Portfolio Standard (RPS) requirement of 50% by 2030 to a new date of 2026, and set a new goal of 60% for 2030.
SVP meets or exceeds the current RPS requirements of 28% this compliance period and is on track to meet 33% by 2020. In order to meet the new accelerated goals under SB 100, SVP must replace existing renewable energy contracts that will expire in the future with new contracts, as well as procure additional renewable energy to meet both load growth projections and annual increases to the RPS as it rises incrementally to 60%.
In conformance with the City's Purchasing Ordinance, the purchase or sale of electrical power and fuels for the generation is not subject to the City's centralized purchasing system, but is instead procured by SVP. SVP procures Power Purchase Agreements (PPAs) by engaging with project developers or generation owners through their direct offerings or through a request for proposal (RFP) process. Each potential PPA project may have unique characteristics that impact the value of the resource to SVP customers and staff evaluates the potential projects on locational value, shape of the generation output, environmental attributes, capacity attributes, viability and flexibility.
DISCUSSION
SVP received a Request for Offer (RFO) in late 2018 from the Olcese Water District and SVP submitted a proposal in January 2019 to purchase the output from...
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