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PUC reviews Clean Power SF contract terms; staff outlines 51% green target and borrowing plan
Summary
Staff briefed the commission on high-level contract terms for Clean Power SF (a Community Choice Aggregation program): initial three-year price caps, rates set equivalent to PG&E initially with a small generation premium, a 51% green-resource target within 10 years, and a vendor-borrowing option to smooth early rates.
The commission received a detailed briefing on Clean Power SF, the city’s Community Choice Aggregation (CCA) program, including key contract features, rate mechanics and next steps in concurrent city review. Barbara Hale, assistant general manager for power, said the program’s contract with PCI (vendor) would initially set rates equivalent to PG&E’s generation charge and include a three-year price cap; over time the program targets 51% green resources by the 10th year and plans to increase local renewable content as new city resources come online.
Hale explained one financing tool in the contract: an initial rate deferral or borrowing mechanism that would let the program smooth upfront costs for developing new resources, to be repaid over the early years of customer participation. When commissioners pressed about the magnitude of that borrowing, Hale said the capital plan under consideration could look at borrowing up to roughly $300 million–$400 million, depending on assumptions. “It varies depending on certain assumptions about the program costs ... at a maximum of about $400,000,000,” she said in response to a commissioner’s question.
On bill impacts, staff estimated that the generation-component premium for the typical low-consuming residential customer would be small: about 75¢ a month in the first years for customers whose usage remains in PG&E’s lower tiers. Commercial customers could see larger percentage impacts on their generation component, staff said. Hale emphasized that preliminary rates will go through the city’s public process — the rate fairness board, PUC review, and Board of Supervisors — and are subject to final contract terms and approval. Staff also said they are still negotiating certain contract terms with PCI and will return as the public process proceeds.
Commissioners and public commenters raised workforce and procurement concerns, including a letter from the Coalition for Green Jobs about the use of renewable energy credits (RECs) and local job impacts; staff said the program scenarios assume purchasing or building wind and solar rather than relying on out-of-state RECs. The commission was advised the Board of Supervisors would begin concurrent review and referral to committees and analysts, and the rate fairness board will meet in advance of any final action.
What’s next: staff will continue contract negotiations with PCI, hold meetings with the rate fairness board and public outreach, and return to the PUC as the Board of Supervisors’ referral and controller’s review proceed. The commission heard the report for information and did not take a final vote on the contract during this meeting.
