The board on June 26 approved two energy storage contract actions intended to preserve local battery capacity and help SDCP meet resource adequacy needs.

Kenny Key, director of power contracts, presented the first item: an amendment to move previously contracted 60 MW / 8‑hour capacity from a stalled Desert Sands site into additional capacity at Yellow Pine Solar 3 LLC’s project. Key said network upgrade delays and development risk made the original site unviable, and moving the capacity to Yellow Pine reduces price and preserves the long‑duration storage SDCP needs for compliance. "We get to move it to the site, keep it viable, have a reduced price for that, move up the commercial operations date to align with when they're able to build out the Yellow Pine site, which is the middle of 2027," Key said. The amendment includes a $250,000 community benefit fund, a project labor agreement and union construction commitments.

The board next approved the North Johnson Energy Center energy storage service agreement, a local project the agency originally approved earlier this year but for which the contractor sought a price adjustment after tariff‑driven supply‑chain cost increases. Key said staff negotiated operational and commercial protections to preserve the project’s near‑term commercial‑operation date and retain local benefits. One mitigation is increasing allowed daily charge‑discharge cycles (where warranties and operations permit) to recover value from arbitrage; another is a price adjustment with contractual downward price triggers if the project misses guaranteed commercial operation dates.

Why it matters: Both approvals preserve local storage capacity that contributes to SDCP’s RA and local capacity targets, support construction jobs and include community benefits; staff emphasized protections to limit downside exposure if a project is delayed.

Both items passed by roll call vote.