Document elcerrito_gov_doc_3c3b741491

AGENDA BILL Agenda Item No. 6(A) Date: December 16, 2014 To: El Cerrito City Council From: Maria Sanders, Environmental Analyst Melanie Mintz, Interim Community Development Director Subject: Join the Marin Clean Energy Joint Powers Authority and Implement a Community Choice Aggregation Program in El Cerrito ACTION REQUESTED Conduct a public hearing and upon conclusion: 1. Adopt a resolution requesting membership in the Marin Clean Energy (MCE) Joint Powers Authority (JPA) and authorizing the City Manager to execute the JPA Agreement with MCE; and 2. Introduce by title, waive any further reading and approve an ordinance authorizing the implementation of a Community Choice Aggregation Program, approving the MCE JPA Agreement, and authorizing the City Manager to execute the JPA Agreement with MCE. BACKGROUND The City of El Cerrito’s Climate Action Plan (CAP), adopted May 2013, contains a strategy to “Explore opportunities for instituting or joining a regional Community Choice Aggregation (CCA) effort” (Strategy EW-3.2). Joining a CCA with a high renewable energy portfolio is identified in the CAP as one of the most cost-effective ways to reduce greenhouse gas emissions in El Cerrito, yielding an estimated 4,200 - 6,700 annual tons of CO2 reductions by 2020 with relatively little investment on the part of the City. In 2002, passage of Community Choice Aggregation (AB 117, Migden) allowed CCAs to operate in California. This legislation enables California cities, counties, public agencies, and joint powers agencies to aggregate the electricity demand of its constituents and to procure electricity that meets their desired electricity supply portfolio, while still having the local utility (PG&E, in El Cerrito’s case) provide transmission, distribution, billing, and repair services. Participation in a CCA is automatic for electricity account holders in a jurisdiction that offers a CCA. Customers who do not want to participate and prefer to purchase power from PG&E can opt out of the CCA. CCA participation rates are high due to this opt-out approach, allowing CCA agencies to secure competitive energy contracts in California’s ---PAGE BREAK--- Agenda Item No. 6(A) Page 2 incumbent-dominated energy markets. Energy transmission, distribution, repair, most customer service, and billing would continue to be administered by PG&E. In 2010, MCE launched California’s first CCA. MCE is a not-for-profit, local government agency in the form of a JPA currently consisting of all jurisdictions in Marin County, the City of Richmond, and more recently Napa County and the cities of Benicia and San Pablo. The mission of MCE is to address climate change by reducing energy-related greenhouse gas emissions, while also securing energy supply, price stability, energy efficiency, and local economic and workforce benefits. Consistent with that mission, MCE sources energy from 51% renewable sources (compared to PG&E’s 2013 22% renewable energy portfolio) at rates that are currently less than those of PG&E. As noted below, although MCE’s rates are currently less than PG&E’s, its rates have fluctuated in the past and might be higher, or lower, than PG&E’s in any given rate-setting period. Given the success of MCE to procure renewable supplies of electricity at competitive rates, many communities throughout California are taking a fresh look at instituting CCAs. Sonoma County launched their county-wide CCA this year. Nine other counties, including Alameda County, are also exploring CCAs as an option. Closer to home, the City of Richmond successfully joined MCE in 2012. In the past few months, San Pablo, Benicia, and Napa County have also joined MCE, setting the stage for a new electricity procurement cycle with MCE to begin early in 2015. The City has been exploring CCA for a couple of years. On October 2, 2012, the City Council received a presentation by Marin Clean Energy and the City of Richmond regarding CCA, their membership process, and their program offerings. During the spring of 2014, the El Cerrito Environmental Quality Committee (EQC) hosted several presentations from various groups involved in CCAs in the Bay Area. Agreeing that joining MCE represented the least cost, lowest risk, and most timely option currently available in Contra Costa County, the EQC passed a unanimous motion at its June 2014 meeting requesting that the City Council consider a resolution requesting that MCE conduct a membership analysis for El Cerrito. On July 15, 2014 the City Council adopted Resolution 2014-28, which authorized the Mayor to submit a letter to MCE requesting that it conduct a membership analysis for El Cerrito and also authorized a contract with MCE for $18,000 to conduct the membership analysis and to participate in El Cerrito community meetings. The majority of this contract was paid for by a $15,000 Climate Leader Grant awarded to the City in April 2014 from the World Wildlife Fund. On November 18, 2014 the City Council held a study session on the prospect of joining MCE, which included detailed discussion on the results of the El Cerrito membership analysis, the benefits and risks of joining MCE, and potential next steps. At that session, the City Council directed staff to: ---PAGE BREAK--- Agenda Item No. 6(A) Page 3 1. Continue pursuing membership in MCE in a timeframe that would enable the City to join the MCE Joint Powers Agency in order to be included in the MCE 2015 procurement cycle; and 2. Provide a copy of MCE’s Organizational Structure (see Attachment 4, MCE Organizational Chart) and MCE's Audited Financial Statements for Years Ended March 31, 2014 and 2013 (http://www.marinenergyauthority.com/sites/default/files/key- documents/MCE%20Financial%20Statements%202014%20%202013.pdf). The following is a summary of the items discussed during the City Council study session on November 18. MCE Membership Analysis for El Cerrito: The analysis indicates that under current market conditions expansion of MCE membership to include El Cerrito would likely result in an approximate 1% rate reduction for MCE customers, including all existing and prospective accounts, and would increase the amount of renewable energy being used in California’s energy market by approximately 16,000 megawatt hours (MWh) per year, resulting in a greenhouse gas (GHG) emissions reduction of approximately 5 million pounds of CO2 per year. Benefits of Joining MCE: • Consumer Choice: Joining MCE would provide El Cerrito residents and businesses with a choice in regard to their energy provider and the degree to which their energy comes from renewable and non-nuclear sources. • Competitive Electricity Rates: MCE customers are currently receiving cleaner electricity at rates that are lower than those of PG&E. • Renewable Incentive Programs: MCE offers a solar net energy metering (NEM) program that provides better terms than comparable PG&E programs. • Access to PG&E and MCE Energy Efficiency Programs: Because PG&E still provides MCE customers with transmission and generation services, they are also PG&E customers and will still have access to energy efficiency and other programs provided by PG&E. In addition, MCE operates energy efficiency programs that are more specifically targeted to the constituents in its territory. • Support of Community Programs and Projects: As a non-profit public agency, MCE allocates a portion of revenues to local projects and programs within its service area. Risks of Joining MCE: • JPA Debts and Liabilities: MCE has limited the liability of their members by including in the JPA agreement a provision explicitly stating that the debts, liabilities and obligations of the JPA shall not be debts, liabilities and obligations of the individual JPA members. While this provision significantly limits the risks of liability to members, it does not insulate them from all risk. ---PAGE BREAK--- Agenda Item No. 6(A) Page 4 • Competitive Rates: Currently MCE electricity rates are less than PG&E’s rates. Due to a variety of regulatory, environmental, and market factors, MCE may not always be able to provide rates that “meet or beat” PG&E’s rates. The converse is also true: PG&E’s rates are influenced by similar, as well as separate, price pressures that may make their rates higher in any given season. Other Considerations Prior to Joining MCE: • MCE’s Organizational Soundness: An independent assessment1 of MCE’s organizational soundness concludes that MCE’s governance structure is reasonable, the management is experienced and competent, and the finances are sound. MCE has been able to increase its net-surplus operating reserves consistently from year to year.2 The assessment concludes that while its long- term financial plan may be optimistic in certain years, less optimistic assumptions would also result in net surplus revenues. • JPA Participation and Voting Share: An El Cerrito City Councilmember would represent the City on the MCE Board of Directors. El Cerrito would have equal participation rights as any jurisdiction in MCE. As outlined in the MCE Joint Powers Agreement (Attachment 3, MCE JPA Agreement), each member is given a weighted voting share. As a function of this formula, El Cerrito’s JPA voting share would be 5.34% of the total JPA, which is in the top 50% of voting shares on the Board. • El Cerrito Time Commitment: Participating in the JPA will require a time commitment on part of both staff and Council Members, amounting to approximately 10 hours per month shared between staff and El Cerrito’s appointed Board Member. • Impacts on Municipal Accounts: Using current electricity rate comparisons, staff estimates that the annual potential financial impact could result in a 3.8% cost decrease of approximately $11,700 (if the City were to enroll its accounts in MCE, which is not a decision being made tonight). Using current emissions factors, enrolling municipal accounts in MCE would reduce GHG emissions by 82 tons of CO2e, or about 10% of the tons needed to reach our 2020 municipal GHG reduction goal of 803 tons. DISCUSSION As a result of the Council study session, the City Council directed staff to continue pursuing membership in MCE in order to be included in MCE’s 2015 electricity procurement cycle. This membership process includes adopting a resolution officially 1 Risk Assessment of Participation in the Marin Clean Energy Community Choice Aggregation Program on Behalf of the City of Benicia. Prepared by MRW and Associates, October 2014 2 Also see MCE's Audited Financial Statements for Years Ended March 31, 2014 and 2013 http://www.marinenergyauthority.com/sites/default/files/key- documents/MCE%20Financial%20Statements%202014%20%202013.pdf ---PAGE BREAK--- Agenda Item No. 6(A) Page 5 requesting membership in the MCE JPA and conducting a public hearing to adopt an ordinance authorizing the implementation of a CCA program and approving the MCE JPA Agreement. Upon completion of the steps described above, the executed City ordinance and signed JPA Agreement will be presented to the MCE Board for acceptance at its next Board meeting. MCE Customer Enrollment Process: After the steps above are completed, MCE would then begin procuring additional electricity supplies for the El Cerrito customer base. At that time, MCE would begin a robust community outreach process: Over a 5- month period, customers in El Cerrito will receive multiple notices about their new energy choice and their right to opt-out of MCE and stay with PG&E. If a customer does nothing, they will automatically be enrolled in MCE’s default “Light Green” service coming from 51% renewable energy sources, rates for which are currently less than PG&E’s comparable rates. Customers are also given a choice to “opt-up” to receive MCE’s “Deep Green” service, which comes from 100% renewable sources currently at a price of $0.01 per kWh more than the Light Green option. PG&E will continue to deliver energy, maintain the lines and wires, and provide billing services to all customers; MCE will ensure the electricity for El Cerrito's energy consumers is sourced from more renewable resources. Community Input Prior to Joining MCE: In order to solicit community input on the prospect of joining MCE after the November City Council study session, staff advertised and posted a survey on the City’s Open El Cerrito website at www.el- cerrito.org/CCAforum and held a community workshop on December 3, 2014. To date, approximately 40 residents participated in either one of those forums. Comments are almost exclusively in favor of joining. A small minority of responses, while still interested in having energy choices, expressed concern regarding the role of “Unbundled Renewable Energy Certificates” in MCE’s purchasing strategy and regarding MCE’s current contract with Shell Energy North America, which they considered to be less socially and environmentally responsible than PG&E. The following provides more information on MCE’s current position vis-à-vis these two concerns: • The Role of Renewable Energy Certificates (RECs) in MCE’s Renewable Energy Portfolio (RPS): RECs are the accepted accounting mechanism for tracking the actual characteristics of renewable energy generating sources. Compliance with California’s RPS law is monitored through RECs. RECs can either be sold with the electron from the physical generation source (“bundled RECs”) or can be separated from the renewable electron and sold to an energy provider for RPS compliance or for voluntary use (“unbundled RECs”). Under California’s RPS law, energy providers can only use a certain percentage of unbundled RECs to meet the current RPS requirement of 33% renewable energy by 2020. Right now, unbundled RECs are allowed to comprise up to 15% of an energy provider’s RPS and will be lowered to no more than 10% by 2017. This progressive shift is meant to drive the development of new renewable generation to displace generation from fossil fuels. ---PAGE BREAK--- Agenda Item No. 6(A) Page 6 MCE’s energy resource mix is documented in its annual Integrated Resource Plan.3 In 2015, MCE’s resource mix is expected to include a very high proportion of renewable energy compared to other utilities, with plans to significantly increase the use of bundled renewable energy supply to approximately 39% of the Light Green supply portfolio. In order to provide the promised 50% renewable energy for the Light Green program, the remaining percentage is achieved through voluntary purchases of unbundled RECs. MCE also offers a voluntary “Deep Green” 100% renewable energy option for customers, which is currently sourced from Green-e Energy4 certified wind RECs. Deep Green comes at a premium of $0.01/kWh, which adds up to about $5 more per month for a typical home. Half of the Deep Green premium paid by participating customers will be allocated to support local development of renewable energy projects. MCE is preparing to offer a second 100% renewable energy option, called Local Sol, which will be sourced entirely from a new solar farm in Novato, California. The product will be limited to approximately 200 customers with a guaranteed, fixed rate for 20 years. Compared to current Deep Green rates, the Local Sol option will cost approximately 30% more. MCE’s goal is to provide a variety of options to empower electricity customers to choose the product that meets their values and budget. For those who want a 100% renewable, 100% local, entirely “bundled” renewable energy product, the Local Sol program will meet these criteria. Alternatively, for those who are more price sensitive, MCE's Light Green 50% renewable energy product currently meets or beats PG&E's rates for energy. Customers who would like to buy a 100% renewable energy project for more than Light Green can choose Deep Green. Finally, customers can choose to stay with PG&E, whose latest reported resource mix was 22% renewable in 2013, and also includes a limited amount of unbundled RECs. • Shell Energy North America Contract: When MCE first began serving customers in 2010, MCE entered into an agreement with Shell Energy North America to meet MCE’s customers’ energy requirements. Since that time, MCE has diversified its resource mix and contracted with other energy developers. As of December 2014, MCE has contracted with 14 energy suppliers, and has nearly a dozen local renewable energy projects in the queue for development in Richmond and Marin. MCE's contract with Shell is set to expire at the end of 2017. Shell supplies energy 3 Every year, MCE must submit to the CPUC an update to its “Integrated Resource Plan.” The last was submitted in November 2014. To view the full document, visit http://marincleanenergy.org/sites/default/files/key-documents/2014_Integrated_Resource_Plan.pdf 4 Green-e Energy is one of the nation’s leading renewable energy certification program. Visit http://www.green-e.org/ for more information. ---PAGE BREAK--- Agenda Item No. 6(A) Page 7 to utilities throughout the western region and also provides energy to PG&E customers. STRATEGIC PLAN CONSIDERATIONS Goal F, “Foster environmental sustainability citywide,” of the El Cerrito Strategic Plan contains an objective to implement the City’s Climate Action Plan by facilitating “energy and water efficiency and greater adoption of clean energy.” Because CCAs in the Bay Area are being formed to procure electricity from renewable energy sources, joining a CCA is identified in the CAP as one of the more powerful and cost-effective strategies for reducing greenhouse gas emissions in El Cerrito. There is no other strategy in the CAP that provides a similar magnitude of reductions at a similar cost. If the City joined MCE, GHG emissions reductions are estimated to be 2,500 tons of CO2e in the first year of full enrollment. By 2020 this reduction is likely to increase as MCE continues to increase its renewable portfolio and was estimated by the CAP to provide between 4,200 and 6,700 tons CO2 reductions per year. ENVIRONMENTAL CONSIDERATIONS Joining MCE is an administrative action that will not result in a direct physical change to the environment or a reasonably foreseeable indirect change to the environment, and thus is not a project as defined by the California Environmental Quality Act (CEQA) Guideline Section 15378. FINANCIAL CONSIDERATIONS There are no direct financial impacts to the City’s General Fund if the City Council elects to join MCE. MCE electricity and programs are funded by ratepayers that choose to participate in MCE. If the City Council joins MCE by early 2015, no additional outside expenses are anticipated. If it elects to pursue membership in 2016, an additional membership analysis would need to be funded and conducted. The cost of community outreach to assist community members in understanding the opt-out system, once the City joins, would be borne by MCE. However, there will be internal expenses related to staff time supporting El Cerrito as a JPA member and to initially assist MCE in their customer outreach process during the enrollment period. As stated previously, if the City enrolls all its electrical municipal accounts in MCE’s Light Green program, the annual potential financial impact is estimated to result in a 3.8% cost decrease of approximately $11,700. This estimate is based on current MCE and PG&E rates. As both MCE and PG&E rates vary from year to year, the actual financial impact will be different at the time of enrollment. LEGAL CONSIDERATIONS The process for joining MCE is as described in this report. All procedures established by state law, and all required notices have been properly given. The City Attorney has reviewed the MCE JPA Agreement, the resolution requesting membership in MCE, and the ordinance for implementing the CCA in El Cerrito by participating as a member of MCE and for approving the JPA agreement. ---PAGE BREAK--- Scott Hanin, City Manager Attachments: 1. Resolution 2. Ordinance 3. MCE Joint Powers Authority Agreement ("JPA Agre~ment") 4. MCE Organizational Chart On-line Resources Agenda Item No. 6(A) 5. MCE's Audited Financial Statements for Years Ended March 31,2014 and 2013 http://wvvw.n1arinenergvauthority.con1/sites/default/files/kev- docmnents/MCEo/o20Financialo/o20Stateinentso/o2020 14o/o20o/o2020 13 .pdf 6. MCE 2014 Integrated Resource Plan http://n1arincleanenergy.org/sites/default/files/key- docun1ents/20 14 Integrated Resource Plan.pdf 7. Correspondence related to MCE membership Page 8 ---PAGE BREAK--- Agenda Item No. 6(A) Attachment 1 RESOLUTION 2014-XX RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EL CERRITO REQUESTING MEMBERSHIP IN THE MARIN CLEAN ENERGY (MCE) JOINT POWERS AGENCY AND AUTHORIZING THE CITY MANAGER TO EXECUTE THE JOINT POWERS AUTHORITY AGREEMENT WITH MCE WHEREAS, the City of El Cerrito has adopted resolutions supporting state and local actions to reduce greenhouse gas emissions, including Resolution 2006-61 endorsing the U.S. Mayors Climate Protection Agreement and Resolution 2006-93 endorsing the reduction targets of the California Global Warming Solutions Act (AB 32); and WHEREAS, the City of El Cerrito adopted its Climate Action Plan on May 21, 2013 with the goal of reducing greenhouse gas emissions from the El Cerrito community and its own city operations by 15% below 2005 emissions levels by 2020 and 30% below 2005 levels by 2035; and WHEREAS, on September 24, 2002, the Governor signed into law Assembly Bill 117 (Stat. 2002, Ch. 838; see California Public Utilities Code section 366.2; hereinafter referred to as the “Act”), which authorizes any California city or county, whose governing body so elects, to combine the electricity load of its residents and businesses in a community-wide electricity aggregation program known as Community Choice Aggregation (CCA); and WHEREAS, the Act expressly authorizes participation in a CCA program through a joint powers agency, and on December 19, 2008, Marin Clean Energy (MCE), formerly known as Marin Energy Authority, was established as a joint powers authority pursuant to a Joint Powers Agreement, as amended from time to time (“MCE Joint Powers Agreement”); and WHEREAS, the purpose of MCE is to address climate change by reducing energy related greenhouse gas emissions and securing energy supply, price stability, energy efficiencies and local economic and workforce benefits; and WHEREAS, the El Cerrito Climate Action Plan has identified membership in a CCA that procures from renewable energy sources to be one of the most cost-effective greenhouse gas emissions reductions strategies; and WHEREAS, the City Council adopted Resolution 2014-28 on July 15, 2014 authorizing the Mayor to submit a letter to Marin Clean Energy requesting it conduct a membership analysis for El Cerrito; and the subsequent membership analysis demonstrated that the City of El Cerrito joining MCE would provide positive rate-payer and environmental benefits in existing and prospective MCE-member communities; and ---PAGE BREAK--- Agenda Item No. 6(A) Attachment 1 WHEREAS, the City Council supports the mission of MCE and its intent to promote the development and use of a wide range of renewable energy sources and energy efficiency programs, including solar and wind energy production at competitive rates for customers; and WHEREAS, in order to become a member of MCE, the MCE Joint Powers Agreement requires the City of El Cerrito to individually adopt a resolution requesting membership in Marin Clean Energy and an ordinance electing to implement a Community Choice Aggregation program within its jurisdiction; and WHEREAS, this administrative action is exempt from CEQA, per State CEQA Guidelines Section 15378, which states there cannot be a project unless the proposed action will result in “either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment.” State CEQA Guidelines Section 15378(b)(5) states that “Organization or administrative activities of governments that will not result in direct or indirect physical changes in the environments” are not projects. Joining a CCA presents no foreseeable significant adverse impact to the environment because California State regulations such as the Renewable Portfolio Standard and the Resource Adequacy requirements apply equally to CCAs as they do the City’s current electricity supplier, PG&E. NOW THEREFORE, BE IT RESOLVED, that the City Council hereby requests that the Board of Directors of MCE approve the City of El Cerrito as a member of MCE, and authorizes the City Manager to execute the Joint Powers Authority Agreement with MCE; and BE IT FURTHER RESOLVED the City Council of the City of El Cerrito does hereby find that this action is exempt from CEQA and directs City Staff to file a notice of exemption with the County Clerk. BE IT FURTHER RESOLVED, that this Resolution shall become effective immediately upon passage and adoption. I CERTIFY that at a regular meeting on December 16, 2014 the City Council of the City of El Cerrito passed this Resolution by the following vote: AYES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: IN WITNESS of this action, I sign this document and affix the corporate seal of the City of El Cerrito on December 2014. ---PAGE BREAK--- Agenda Item No. 6(A) Attachment 1 Cheryl Morse, City Clerk APPROVED: Mark Friedman, Mayor ---PAGE BREAK--- Agenda Item No. 6(A) Attachment 2 ORDINANCE NO. 2014-XX AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF EL CERRITO AUTHORIZING THE IMPLEMENTATION OF A COMMUNITY CHOICE AGGREGATION PROGRAM, APPROVING THE MARIN CLEAN ENERGY JOINT POWERS AGREEMENT, AND AUTHORIZING THE CITY MANAGER TO EXECUTE THE JOINT POWERS AGREEMENT WITH MARIN CLEAN ENERGY THE CITY COUNCIL OF THE CITY OF EL CERRITO DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. FINDINGS On September 24, 2002, the Governor signed into law Assembly Bill 117 (Stat. 2002, Ch. 838; see California Public Utilities Code section 366.2; hereinafter referred to as the “CCA Act”), which authorizes any California city or county, whose governing body so elects, to combine the electricity load of its residents and businesses in a community-wide electricity aggregation program known as Community Choice Aggregation (CCA); and The CCA Act expressly authorizes participation in a CCA program through a joint powers agency, and on December 19, 2008, Marin Clean Energy (MCE), formerly known as Marin Energy Authority, was established as a joint powers authority pursuant to a Joint Powers Agreement, as amended from time to time (“MCE Joint Powers Agreement”); and The purpose of MCE is to address climate change by reducing energy related greenhouse gas emissions and securing energy supply, price stability, energy efficiencies and local economic and workforce benefits; and On February 2, 2010, the California Public Utilities Commission certified the “Implementation Plan” of MCE, confirming MCE’s compliance with the requirements of the Act; and The City of El Cerrito adopted a Climate Action Plan on May 21, 2013 with the goal of reducing greenhouse gas emissions from the El Cerrito community and its own city operations by 15% below 2005 emissions levels by 2020 and 30% below 2005 levels by 2035; and The El Cerrito Climate Action Plan contains goals and objectives to reduce reliance on fossil fuel based energy by increasing renewable energy throughout El Cerrito, including membership in a CCA, which it identified to be one of the most cost-effective greenhouse gas emissions reductions strategies available to the City; and The City Council supports the mission of MCE and its intent to promote the development and use of a wide range of renewable energy sources and energy efficiency programs, including solar and wind energy production at competitive rates for customers; and ---PAGE BREAK--- Agenda Item No. 6(A) Attachment 2 In order to become a member of MCE, the Act requires the City to individually adopt an ordinance electing to implement a Community Choice Aggregation program within its jurisdiction by and through its participation in Marin Clean Energy; and This administrative action is exempt from CEQA, pursuant to State CEQA Guidelines Section 15378, which states there cannot be a project unless the proposed action will result in “either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment.” State CEQA Guidelines Section 15378(b)(5) states that “Organization or administrative activities of governments that will not result in direct or indirect physical changes in the environments” are not projects. Joining a CCA presents no foreseeable significant adverse impact to the environment because California State regulations such as the Renewable Portfolio Standard and the Resource Adequacy requirements apply equally to CCAs as they do the City’s current electricity supplier, PG&E. SECTION 2. COMPLIANCE WITH THE CALIFORNIA ENVIRONMENTAL QUALITY ACT Pursuant to Title 14 of the California Administrative Code, the City Council finds that this Ordinance is exempt from the requirements of the California Environmental Quality Act (CEQA) for the following reasons: Pursuant to State CEQA Guidelines Section 15378, there cannot be a project unless the proposed action will result in “either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment;” and State CEQA Guidelines Section 15378(b)(5) states that “organization or administrative activities of governments that will not result in direct or indirect physical changes in the environments” are not projects. SECTION 3. APPROVAL The City Council of the City of El Cerrito elects to implement a Community Choice Aggregation program within the City’s jurisdiction by and through the City’s participation in MCE. The City Manager is hereby authorized to execute the MCE Joint Powers Agreement. SECTION 4. NOTICING, POSTING, AND PUBLICATION This ordinance is adopted pursuant to the procedures established by state law, and all required notices have been given, and the public hearing has been properly held and conducted. SECTION 5. EFFECTIVE DATE This ordinance shall not take effect until thirty days after the second reading, January 6, 2015. THE FOREGOING ORDINANCE was introduced at a regular meeting of the City Council on December 16, 2014 and passed by the following vote: AYES: Councilmembers NOES: Councilmembers ---PAGE BREAK--- Agenda Item No. 6(A) Attachment 2 ABSTAIN: Councilmembers ABSENT: Councilmembers Adopted and ordered published at a regular meeting of the City Council held on January 6, 2015 and passed by the following vote: AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers ABSENT: Councilmembers APPROVED: Mark Friedman, Mayor ATTEST: Cheryl Morse, City Clerk IN WITNESS of this action, I sign this document and affix the corporate seal of the City of El Cerrito on January 6, 2015. Cheryl Morse, City Clerk ORDINANCE CERTIFICATION I, Cheryl Morse, City Clerk of the City of El Cerrito, do hereby certify that this Ordinance is the true and correct original Ordinance No. 2014-XX of the City of El Cerrito; that said Ordinance was duly enacted and adopted by the City Council of the City of El Cerrito at a meeting of the City Council held on the _ day of January, 2015; and that said Ordinance has been published and/or posted in the manner required by law. WITNESS my hand and the Official Seal of the City of El Cerrito, California, this __th day of January, 2015. Cheryl Morse, City Clerk ---PAGE BREAK--- Marin Energy Authority - Joint Powers Agreement - Effective December 19, 2008 As amended by Amendment No. 1 dated December 3, 2009 As further amended by Amendment No. 2 dated March 4, 2010 As further amended by Amendment No. 3 dated May 6, 2010 As further amended by Amendment No. 4 dated December 1, 2011 As further amended by Amendment No. 5 dated July 5, 2012 As further amended by Amendment No. 6 dated September 5, 2013 As further amended by Amendment No. 7 dated December 5, 2013 As further amended by Amendment No. 8 dated September 4, 2014 Among The Following Parties: City of Belvedere Town of Corte Madera Town of Fairfax City of Larkspur City of Mill Valley City of Novato City of Richmond Town of Ross Town of San Anselmo City of San Pablo City of San Rafael City of Sausalito Town of Tiburon County of Marin County of Napa Agenda Item No. 6(A) Attachment 3 ---PAGE BREAK--- MARIN ENERGY AUTHORITY JOINT POWERS AGREEMENT This Joint Powers Agreement (“Agreement”), effective as of December 19, 2008, is made and entered into pursuant to the provisions of Title 1, Division 7, Chapter 5, Article 1 (Section 6500 et seq.) of the California Government Code relating to the joint exercise of powers among the parties set forth in Exhibit B (“Parties”). The term “Parties” shall also include an incorporated municipality or county added to this Agreement in accordance with Section 3.1. RECITALS 1. The Parties are either incorporated municipalities or counties sharing various powers under California law, including but not limited to the power to purchase, supply, and aggregate electricity for themselves and their inhabitants. 2. In 2006, the State Legislature adopted AB 32, the Global Warming Solutions Act, which mandates a reduction in greenhouse gas emissions in 2020 to 1990 levels. The California Air Resources Board is promulgating regulations to implement AB 32 which will require local government to develop programs to reduce greenhouse emissions. 3. The purposes for the Initial Participants (as such term is defined in Section 2.2 below) entering into this Agreement include addressing climate change by reducing energy related greenhouse gas emissions and securing energy supply and price stability, energy efficiencies and local economic benefits. It is the intent of this Agreement to promote the development and use of a wide range of renewable energy sources and energy efficiency programs, including but not limited to solar and wind energy production. 4. The Parties desire to establish a separate public agency, known as the Marin Energy Authority (“Authority”), under the provisions of the Joint Exercise of Powers Act of the State of California (Government Code Section 6500 et seq.) (“Act”) in order to collectively study, promote, develop, conduct, operate, and manage energy programs. 5. The Initial Participants have each adopted an ordinance electing to implement through the Authority Community Choice Aggregation, an electric service enterprise agency available to cities and counties pursuant to California Public Utilities Code Section 366.2 (“CCA Program”). The first priority of the Authority will be the consideration of those actions necessary to implement the CCA Program. Regardless of whether or not Program Agreement 1 is approved and the CCA Program becomes operational, the parties intend for the Authority to continue to study, promote, develop, conduct, operate and manage other energy programs. ---PAGE BREAK--- AGREEMENT NOW, THEREFORE, in consideration of the mutual promises, covenants, and conditions hereinafter set forth, it is agreed by and among the Parties as follows: ARTICLE 1 CONTRACT DOCUMENTS 1.1 Definitions. Capitalized terms used in the Agreement shall have the meanings specified in Exhibit A, unless the context requires otherwise. 1.2 Documents Included. This Agreement consists of this document and the following exhibits, all of which are hereby incorporated into this Agreement. Exhibit A: Definitions Exhibit B: List of the Parties Exhibit C: Annual Energy Use Exhibit D: Voting Shares 1.3 Revision of Exhibits. The Parties agree that Exhibits B, C and D to this Agreement describe certain administrative matters that may be revised upon the approval of the Board, without such revision constituting an amendment to this Agreement, as described in Section 8.4. The Authority shall provide written notice to the Parties of the revision of any such exhibit. ARTICLE 2 FORMATION OF MARIN ENERGY AUTHORITY 2.1 Effective Date and Term. This Agreement shall become effective and Marin Energy Authority shall exist as a separate public agency on the date this Agreement is executed by at least two Initial Participants after the adoption of the ordinances required by Public Utilities Code Section 366.2(c)(10). The Authority shall provide notice to the Parties of the Effective Date. The Authority shall continue to exist, and this Agreement shall be effective, until this Agreement is terminated in accordance with Section 7.4, subject to the rights of the Parties to withdraw from the Authority. 2.2 Initial Participants. During the first 180 days after the Effective Date, all other Initial Participants may become a Party by executing this Agreement and delivering an executed copy of this Agreement and a copy of the adopted ordinance required by Public Utilities Code Section 366.2(c)(10) to the Authority. Additional conditions, described in Section 3.1, may apply to either an incorporated municipality or county desiring to become a Party and is not an Initial Participant and (ii) to Initial Participants that have not executed and delivered this Agreement within the time period described above. ---PAGE BREAK--- 2.3 Formation. There is formed as of the Effective Date a public agency named the Marin Energy Authority. Pursuant to Sections 6506 and 6507 of the Act, the Authority is a public agency separate from the Parties. The debts, liabilities or obligations of the Authority shall not be debts, liabilities or obligations of the individual Parties unless the governing board of a Party agrees in writing to assume any of the debts, liabilities or obligations of the Authority. A Party who has not agreed to assume an Authority debt, liability or obligation shall not be responsible in any way for such debt, liability or obligation even if a majority of the Parties agree to assume the debt, liability or obligation of the Authority. Notwithstanding Section 8.4 of this Agreement, this Section 2.3 may not be amended unless such amendment is approved by the governing board of each Party. 2.4 Purpose. The purpose of this Agreement is to establish an independent public agency in order to exercise powers common to each Party to study, promote, develop, conduct, operate, and manage energy and energy-related climate change programs, and to exercise all other powers necessary and incidental to accomplishing this purpose. Without limiting the generality of the foregoing, the Parties intend for this Agreement to be used as a contractual mechanism by which the Parties are authorized to participate as a group in the CCA Program, as further described in Section 5.1. The Parties intend that subsequent agreements shall define the terms and conditions associated with the actual implementation of the CCA Program and any other energy programs approved by the Authority. 2.5 Powers. The Authority shall have all powers common to the Parties and such additional powers accorded to it by law. The Authority is authorized, in its own name, to exercise all powers and do all acts necessary and proper to carry out the provisions of this Agreement and fulfill its purposes, including, but not limited to, each of the following: 2.5.1 make and enter into contracts; 2.5.2 employ agents and employees, including but not limited to an Executive Director; 2.5.3 acquire, contract, manage, maintain, and operate any buildings, works or improvements; 2.5.4 acquire by eminent domain, or otherwise, except as limited under Section 6508 of the Act, and to hold or dispose of any property; 2.5.5 lease any property; 2.5.6 sue and be sued in its own name; 2.5.7 incur debts, liabilities, and obligations, including but not limited to loans from private lending sources pursuant to its temporary borrowing powers such as Government Code Section 53850 et seq. and authority under the Act; 2.5.8 issue revenue bonds and other forms of indebtedness; 2.5.9 apply for, accept, and receive all licenses, permits, grants, loans or other aids from any federal, state or local public agency; ---PAGE BREAK--- 2.5.10 submit documentation and notices, register, and comply with orders, tariffs and agreements for the establishment and implementation of the CCA Program and other energy programs; 2.5.11 adopt rules, regulations, policies, bylaws and procedures governing the operation of the Authority (“Operating Rules and Regulations”); and 2.5.12 make and enter into service agreements relating to the provision of services necessary to plan, implement, operate and administer the CCA Program and other energy programs, including the acquisition of electric power supply and the provision of retail and regulatory support services. 2.6 Limitation on Powers. As required by Government Code Section 6509, the power of the Authority is subject to the restrictions upon the manner of exercising power possessed by the County of Marin. 2.7 Compliance with Local Zoning and Building Laws. Notwithstanding any other provisions of this Agreement or state law, any facilities, buildings or structures located, constructed or caused to be constructed by the Authority within the territory of the Authority shall comply with the General Plan, zoning and building laws of the local jurisdiction within which the facilities, buildings or structures are constructed. ARTICLE 3 AUTHORITY PARTICIPATION 3.1 Addition of Parties. Subject to Section 2.2, relating to certain rights of Initial Participants, other incorporated municipalities and counties may become Parties upon the adoption of a resolution by the governing body of such incorporated municipality or such county requesting that the incorporated municipality or county, as the case may be, become a member of the Authority, the adoption, by an affirmative vote of the Board satisfying the requirements described in Section 4.9.1, of a resolution authorizing membership of the additional incorporated municipality or county, specifying the membership payment, if any, to be made by the additional incorporated municipality or county to reflect its pro rata share of organizational, planning and other pre-existing expenditures, and describing additional conditions, if any, associated with membership, the adoption of an ordinance required by Public Utilities Code Section 366.2(c)(10) and execution of this Agreement and other necessary program agreements by the incorporated municipality or county, payment of the membership payment, if any, and satisfaction of any conditions established by the Board. Notwithstanding the foregoing, in the event the Authority decides to not implement a CCA Program, the requirement that an additional party adopt the ordinance required by Public Utilities Code Section 366.2(c)(10) shall not apply. Under such circumstance, the Board resolution authorizing membership of an additional incorporated municipality or county shall be adopted in accordance with the voting requirements of Section 4.10. ---PAGE BREAK--- 3.2 Continuing Participation. The Parties acknowledge that membership in the Authority may change by the addition and/or withdrawal or termination of Parties. The Parties agree to participate with such other Parties as may later be added, as described in Section 3.1. The Parties also agree that the withdrawal or termination of a Party shall not affect this Agreement or the remaining Parties’ continuing obligations under this Agreement. ARTICLE 4 GOVERNANCE AND INTERNAL ORGANIZATION 4.1 Board of Directors. The governing body of the Authority shall be a Board of Directors (“Board”) consisting of one director for each Party appointed in accordance with Section 4.2. 4.2 Appointment and Removal of Directors. The Directors shall be appointed and may be removed as follows: 4.2.1 The governing body of each Party shall appoint and designate in writing one regular Director who shall be authorized to act for and on behalf of the Party on matters within the powers of the Authority. The governing body of each Party also shall appoint and designate in writing one alternate Director who may vote on matters when the regular Director is absent from a Board meeting. The person appointed and designated as the Director or the alternate Director shall be a member of the governing body of the Party. 4.2.2 The Operating Rules and Regulations, to be developed and approved by the Board in accordance with Section 2.5.11, shall specify the reasons for and process associated with the removal of an individual Director for cause. Notwithstanding the foregoing, no Party shall be deprived of its right to seat a Director on the Board and any such Party for which its Director and/or alternate Director has been removed may appoint a replacement. 4.3 Terms of Office. Each Director shall serve at the pleasure of the governing body of the Party that the Director represents, and may be removed as Director by such governing body at any time. If at any time a vacancy occurs on the Board, a replacement shall be appointed to fill the position of the previous Director in accordance with the provisions of Section 4.2 within 90 days of the date that such position becomes vacant. 4.4 Quorum. A majority of the Directors shall constitute a quorum, except that less than a quorum may adjourn from time to time in accordance with law. ---PAGE BREAK--- 4.5 Powers and Function of the Board. The Board shall conduct or authorize to be conducted all business and activities of the Authority, consistent with this Agreement, the Authority Documents, the Operating Rules and Regulations, and applicable law. 4.6 Executive Committee. The Board may establish an executive committee consisting of a smaller number of Directors. The Board may delegate to the executive committee such authority as the Board might otherwise exercise, subject to limitations placed on the Board’s authority to delegate certain essential functions, as described in the Operating Rules and Regulations. The Board may not delegate to the Executive Committee or any other committee its authority under Section 2.5.11 to adopt and amend the Operating Rules and Regulations. 4.7 Commissions, Boards and Committees. The Board may establish any advisory commissions, boards and committees as the Board deems appropriate to assist the Board in carrying out its functions and implementing the CCA Program, other energy programs and the provisions of this Agreement. 4.8 Director Compensation. Compensation for work performed by Directors on behalf of the Authority shall be borne by the Party that appointed the Director. The Board, however, may adopt by resolution a policy relating to the reimbursement of expenses incurred by Directors. 4.9 Board Voting Related to the CCA Program. 4.9.1. To be effective, on all matters specifically related to the CCA Program, a vote of the Board shall consist of the following: a majority of all Directors shall vote in the affirmative or such higher voting percentage expressly set forth in Sections 7.2 and 8.4 (the “percentage vote”) and the corresponding voting shares (as described in Section 4.9.2 and Exhibit D) of all such Directors voting in the affirmative shall exceed 50%, or such other higher voting shares percentage expressly set forth in Sections 7.2 and 8.4 (the “percentage voting shares”), provided that, in instances in which such other higher voting share percentage would result in any one Director having a voting share that equals or exceeds that which is necessary to disapprove the matter being voted on by the Board, at least one other Director shall be required to vote in the negative in order to disapprove such matter. 4.9.2. Unless otherwise stated herein, voting shares of the Directors shall be determined by combining the following: an equal voting share for each Director determined in accordance with the formula detailed in Section 4.9.2.1, below; and an additional voting share determined in accordance with the formula detailed in Section 4.9.2.2, below. 4.9.2.1 Pro Rata Voting Share. Each Director shall have an equal voting share as determined by the following formula: (1/total number of ---PAGE BREAK--- Directors) multiplied by 50, and 4.9.2.2 Annual Energy Use Voting Share. Each Director shall have an additional voting share as determined by the following formula: (Annual Energy Use/Total Annual Energy) multiplied by 50, where “Annual Energy Use” means, with respect to the first 5 years following the Effective Date, the annual electricity usage, expressed in kilowatt hours (“kWhs”), within the Party’s respective jurisdiction and (ii) with respect to the period after the fifth anniversary of the Effective Date, the annual electricity usage, expressed in kWhs, of accounts within a Party’s respective jurisdiction that are served by the Authority and “Total Annual Energy” means the sum of all Parties’ Annual Energy Use. The initial values for Annual Energy use are designated in Exhibit C, and shall be adjusted annually as soon as reasonably practicable after January 1, but no later than March 1 of each year 4.9.2.3 The voting shares are set forth in Exhibit D. Exhibit D may be updated to reflect revised annual energy use amounts and any changes in the parties to the Agreement without amending the Agreement provided that the Board is provided a copy of the updated Exhibit D. 4.10 Board Voting on General Administrative Matters and Programs Not Involving CCA. Except as otherwise provided by this Agreement or the Operating Rules and Regulations, each member shall have one vote on general administrative matters, including but not limited to the adoption and amendment of the Operating Rules and Regulations, and energy programs not involving CCA. Action on these items shall be determined by a majority vote of the quorum present and voting on the item or such higher voting percentage expressly set forth in Sections 7.2 and 8.4. 4.11 Board Voting on CCA Programs Not Involving CCA That Require Financial Contributions. The approval of any program or other activity not involving CCA that requires financial contributions by individual Parties shall be approved only by a majority vote of the full membership of the Board subject to the right of any Party who votes against the program or activity to opt-out of such program or activity pursuant to this section. The Board shall provide at least 45 days prior written notice to each Party before it considers the program or activity for adoption at a Board meeting. Such notice shall be provided to the governing body and the chief administrative officer, city manager or town manager of each Party. The Board also shall provide written notice of such program or activity adoption to the above-described officials of each Party within 5 days after the Board adopts the program or activity. Any Party voting against the approval of a program or other activity of the Authority requiring financial contributions by individual Parties may elect to opt-out of participation in such program or activity by ---PAGE BREAK--- providing written notice of this election to the Board within 30 days after the program or activity is approved by the Board. Upon timely exercising its opt-out election, a Party shall not have any financial obligation or any liability whatsoever for the conduct or operation of such program or activity. 4.12 Meetings and Special Meetings of the Board. The Board shall hold at least four regular meetings per year, but the Board may provide for the holding of regular meetings at more frequent intervals. The date, hour and place of each regular meeting shall be fixed by resolution or ordinance of the Board. Regular meetings may be adjourned to another meeting time. Special meetings of the Board may be called in accordance with the provisions of California Government Code Section 54956. Directors may participate in meetings telephonically, with full voting rights, only to the extent permitted by law. All meetings of the Board shall be conducted in accordance with the provisions of the Ralph M. Brown Act (California Government Code Section 54950 et seq.). 4.13 Selection of Board Officers. 4.13.1 Chair and Vice Chair. The Directors shall select, from among themselves, a Chair, who shall be the presiding officer of all Board meetings, and a Vice Chair, who shall serve in the absence of the Chair. The term of office of the Chair and Vice Chair shall continue for one year, but there shall be no limit on the number of terms held by either the Chair or Vice Chair. The office of either the Chair or Vice Chair shall be declared vacant and a new selection shall be made if: the person serving dies, resigns, or the Party that the person represents removes the person as its representative on the Board or the Party that he or she represents withdraws form the Authority pursuant to the provisions of this Agreement. 4.13.2 Secretary. The Board shall appoint a Secretary, who need not be a member of the Board, who shall be responsible for keeping the minutes of all meetings of the Board and all other official records of the Authority. 4.13.3 Treasurer and Auditor. The Board shall appoint a qualified person to act as the Treasurer and a qualified person to act as the Auditor, neither of whom needs to be a member of the Board. If the Board so designates, and in accordance with the provisions of applicable law, a qualified person may hold both the office of Treasurer and the office of Auditor of the Authority. Unless otherwise exempted from such requirement, the Authority shall cause an independent audit to be made by a certified public accountant, or public accountant, in compliance with Section 6505 of the Act. The Treasurer shall act as the depositary of the Authority and have custody of all the money of the Authority, from whatever source, and as such, shall have all of the duties and responsibilities specified in Section 6505.5 of the Act. The Board may require the Treasurer and/or Auditor to ---PAGE BREAK--- file with the Authority an official bond in an amount to be fixed by the Board, and if so requested the Authority shall pay the cost of premiums associated with the bond. The Treasurer shall report directly to the Board and shall comply with the requirements of treasurers of incorporated municipalities. The Board may transfer the responsibilities of Treasurer to any person or entity as the law may provide at the time. The duties and obligations of the Treasurer are further specified in Article 6. 4.14 Administrative Services Provider. The Board may appoint one or more administrative services providers to serve as the Authority’s agent for planning, implementing, operating and administering the CCA Program, and any other program approved by the Board, in accordance with the provisions of a written agreement between the Authority and the appointed administrative services provider or providers that will be known as an Administrative Services Agreement. The Administrative Services Agreement shall set forth the terms and conditions by which the appointed administrative services provider shall perform or cause to be performed all tasks necessary for planning, implementing, operating and administering the CCA Program and other approved programs. The Administrative Services Agreement shall set forth the term of the Agreement and the circumstances under which the Administrative Services Agreement may be terminated by the Authority. This section shall not in any way be construed to limit the discretion of the Authority to hire its own employees to administer the CCA Program or any other program. ARTICLE 5 IMPLEMENTATION ACTION AND AUTHORITY DOCUMENTS 5.1 Preliminary Implementation of the CCA Program. 5.1.1 Enabling Ordinance. Except as otherwise provided by Section 3.1, prior to the execution of this Agreement, each Party shall adopt an ordinance in accordance with Public Utilities Code Section 366.2(c)(10) for the purpose of specifying that the Party intends to implement a CCA Program by and through its participation in the Authority. 5.1.2 Implementation Plan. The Authority shall cause to be prepared an Implementation Plan meeting the requirements of Public Utilities Code Section 366.2 and any applicable Public Utilities Commission regulations as soon after the Effective Date as reasonably practicable. The Implementation Plan shall not be filed with the Public Utilities Commission until it is approved by the Board in the manner provided by Section 4.9. ---PAGE BREAK--- 5.1.3 Effect of Vote On Required Implementation Action. In the event that two or more Parties vote to approve Program Agreement 1 or any earlier action required for the implementation of the CCA Program (“Required Implementation Action”), but such vote is insufficient to approve the Required Implementation Action under Section 4.9, the following will occur: 5.1.3.1 The Parties voting against the Required Implementation Action shall no longer be a Party to this Agreement and this Agreement shall be terminated, without further notice, with respect to each of the Parties voting against the Required Implementation Action at the time this vote is final. The Board may take a provisional vote on a Required Implementation Action in order to initially determine the position of the Parties on the Required Implementation Action. A vote, specifically stated in the record of the Board meeting to be a provisional vote, shall not be considered a final vote with the consequences stated above. A Party who is terminated from this Agreement pursuant to this section shall be considered the same as a Party that voluntarily withdrew from the Agreement under Section 7.1.1.1. 5.1.3.2 After the termination of any Parties pursuant to Section 5.1.3.1, the remaining Parties to this Agreement shall be only the Parties who voted in favor of the Required Implementation Action. 5.1.4 Termination of CCA Program. Nothing contained in this Article or this Agreement shall be construed to limit the discretion of the Authority to terminate the implementation or operation of the CCA Program at any time in accordance with any applicable requirements of state law. 5.2 Authority Documents. The Parties acknowledge and agree that the affairs of the Authority will be implemented through various documents duly adopted by the Board through Board resolution, including but not necessarily limited to the Operating Rules and Regulations, the annual budget, and specified plans and policies defined as the Authority Documents by this Agreement. The Parties agree to abide by and comply with the terms and conditions of all such Authority Documents that may be adopted by the Board, subject to the Parties’ right to withdraw from the Authority as described in Article 7. ---PAGE BREAK--- ARTICLE 6 FINANCIAL PROVISIONS 6.1 Fiscal Year. The Authority’s fiscal year shall be 12 months commencing July 1 and ending June 30. The fiscal year may be changed by Board resolution. 6.2 Depository. 6.2.1 All funds of the Authority shall be held in separate accounts in the name of the Authority and not commingled with funds of any Party or any other person or entity. 6.2.2 All funds of the Authority shall be strictly and separately accounted for, and regular reports shall be rendered of all receipts and disbursements, at least quarterly during the fiscal year. The books and records of the Authority shall be open to inspection by the Parties at all reasonable times. The Board shall contract with a certified public accountant or public accountant to make an annual audit of the accounts and records of the Authority, which shall be conducted in accordance with the requirements of Section 6505 of the Act. 6.2.3 All expenditures shall be made in accordance with the approved budget and upon the approval of any officer so authorized by the Board in accordance with its Operating Rules and Regulations. The Treasurer shall draw checks or warrants or make payments by other means for claims or disbursements not within an applicable budget only upon the prior approval of the Board. 6.3 Budget and Recovery Costs. 6.3.1 Budget. The initial budget shall be approved by the Board. The Board may revise the budget from time to time through an Authority Document as may be reasonably necessary to address contingencies and unexpected expenses. All subsequent budgets of the Authority shall be prepared and approved by the Board in accordance with the Operating Rules and Regulations. 6.3.2 County Funding of Initial Costs. The County of Marin shall fund the Initial Costs of the Authority in implementing the CCA Program in an amount not to exceed $500,000 unless a larger amount of funding is approved by the Board of Supervisors of the County. This funding shall be paid by the County at the times and in the amounts required by the Authority. In the event that the CCA Program becomes operational, these Initial Costs paid by the County of Marin shall be included in the customer charges for electric services as provided by Section 6.3.4 to the extent permitted by law, and the County of Marin shall be reimbursed from the ---PAGE BREAK--- payment of such charges by customers of the Authority. The Authority may establish a reasonable time period over which such costs are recovered. In the event that the CCA Program does not become operational, the County of Marin shall not be entitled to any reimbursement of the Initial Costs it has paid from the Authority or any Party. 6.3.3 CCA Program Costs. The Parties desire that, to the extent reasonably practicable, all costs incurred by the Authority that are directly or indirectly attributable to the provision of electric services under the CCA Program, including the establishment and maintenance of various reserve and performance funds, shall be recovered through charges to CCA customers receiving such electric services. 6.3.4 General Costs. Costs that are not directly or indirectly attributable to the provision of electric services under the CCA Program, as determined by the Board, shall be defined as general costs. General costs shall be shared among the Parties on such basis as the Board shall determine pursuant to an Authority Document. 6.3.5 Other Energy Program Costs. Costs that are directly or indirectly attributable to energy programs approved by the Authority other than the CCA Program shall be shared among the Parties on such basis as the Board shall determine pursuant to an Authority Document. ARTICLE 7 WITHDRAWAL AND TERMINATION 7.1 Withdrawal. 7.1.1 General. 7.1.1.1 Prior to the Authority’s execution of Program Agreement 1, any Party may withdraw its membership in the Authority by giving no less than 30 days advance written notice of its election to do so, which notice shall be given to the Authority and each Party. To permit consideration by the governing body of each Party, the Authority shall provide a copy of the proposed Program Agreement 1 to each Party at least 90 days prior to the consideration of such agreement by the Board. 7.1.1.2 Subsequent to the Authority’s execution of Program Agreement 1, a Party may withdraw its membership in the Authority, effective as of the beginning of the Authority’s fiscal year, by giving no less than 6 ---PAGE BREAK--- months advance written notice of its election to do so, which notice shall be given to the Authority and each Party, and upon such other conditions as may be prescribed in Program Agreement 1. 7.1.2 Amendment. Notwithstanding Section 7.1.1, a Party may withdraw its membership in the Authority following an amendment to this Agreement in the manner provided by Section 8.4. 7.1.3 Continuing Liability; Further Assurances. A Party that withdraws its membership in the Authority may be subject to certain continuing liabilities, as described in Section 7.3. The withdrawing Party and the Authority shall execute and deliver all further instruments and documents, and take any further action that may be reasonably necessary, as determined by the Board, to effectuate the orderly withdrawal of such Party from membership in the Authority. The Operating Rules and Regulations shall prescribe the rights if any of a withdrawn Party to continue to participate in those Board discussions and decisions affecting customers of the CCA Program that reside or do business within the jurisdiction of the Party. 7.2 Involuntary Termination of a Party. This Agreement may be terminated with respect to a Party for material non-compliance with provisions of this Agreement or the Authority Documents upon an affirmative vote of the Board in which the minimum percentage vote and percentage voting shares, as described in Section 4.9.1, shall be no less than 67%, excluding the vote and voting shares of the Party subject to possible termination. Prior to any vote to terminate this Agreement with respect to a Party, written notice of the proposed termination and the reason(s) for such termination shall be delivered to the Party whose termination is proposed at least 30 days prior to the regular Board meeting at which such matter shall first be discussed as an agenda item. The written notice of proposed termination shall specify the particular provisions of this Agreement or the Authority Documents that the Party has allegedly violated. The Party subject to possible termination shall have the opportunity at the next regular Board meeting to respond to any reasons and allegations that may be cited as a basis for termination prior to a vote regarding termination. A Party that has had its membership in the Authority terminated may be subject to certain continuing liabilities, as described in Section 7.3. In the event that the Authority decides to not implement the CCA Program, the minimum percentage vote of 67% shall be conducted in accordance with Section 4.10 rather than Section 4.9.1. 7.3 Continuing Liability; Refund. Upon a withdrawal or involuntary termination of a Party, the Party shall remain responsible for any claims, demands, damages, or liabilities arising from the Party’s membership in the Authority through the date of its withdrawal or involuntary termination, it being agreed that the Party shall not be responsible for any claims, demands, damages, or liabilities arising after the date of the Party’s withdrawal or involuntary termination. In addition, such ---PAGE BREAK--- Party also shall be responsible for any costs or obligations associated with the Party’s participation in any program in accordance with the provisions of any agreements relating to such program provided such costs or obligations were incurred prior to the withdrawal of the Party. The Authority may withhold funds otherwise owing to the Party or may require the Party to deposit sufficient funds with the Authority, as reasonably determined by the Authority, to cover the Party’s liability for the costs described above. Any amount of the Party’s funds held on deposit with the Authority above that which is required to pay any liabilities or obligations shall be returned to the Party. 7.4 Mutual Termination. This Agreement may be terminated by mutual agreement of all the Parties; provided, however, the foregoing shall not be construed as limiting the rights of a Party to withdraw its membership in the Authority, and thus terminate this Agreement with respect to such withdrawing Party, as described in Section 7.1. 7.5 Disposition of Property upon Termination of Authority. Upon termination of this Agreement as to all Parties, any surplus money or assets in possession of the Authority for use under this Agreement, after payment of all liabilities, costs, expenses, and charges incurred under this Agreement and under any program documents, shall be returned to the then-existing Parties in proportion to the contributions made by each. ARTICLE 8 MISCELLANEOUS PROVISIONS 8.1 Dispute Resolution. The Parties and the Authority shall make reasonable efforts to settle all disputes arising out of or in connection with this Agreement. Should such efforts to settle a dispute, after reasonable efforts, fail, the dispute shall be settled by binding arbitration in accordance with policies and procedures established by the Board. 8.2 Liability of Directors, Officers, and Employees. The Directors, officers, and employees of the Authority shall use ordinary care and reasonable diligence in the exercise of their powers and in the performance of their duties pursuant to this Agreement. No current or former Director, officer, or employee will be responsible for any act or omission by another Director, officer, or employee. The Authority shall defend, indemnify and hold harmless the individual current and former Directors, officers, and employees for any acts or omissions in the scope of their employment or duties in the manner provided by Government Code Section 995 et seq. Nothing in this section shall be construed to limit the defenses ---PAGE BREAK--- available under the law, to the Parties, the Authority, or its Directors, officers, or employees. 8.3 Indemnification of Parties. The Authority shall acquire such insurance coverage as is necessary to protect the interests of the Authority, the Parties and the public. The Authority shall defend, indemnify and hold harmless the Parties and each of their respective Board or Council members, officers, agents and employees, from any and all claims, losses, damages, costs, injuries and liabilities of every kind arising directly or indirectly from the conduct, activities, operations, acts, and omissions of the Authority under this Agreement. 8.4 Amendment of this Agreement. This Agreement may be amended by an affirmative vote of the Board in which the minimum percentage vote and percentage voting shares, as described in Section 4.9.1, shall be no less than 67%. The Authority shall provide written notice to all Parties of amendments to this Agreement, including the effective date of such amendments. A Party shall be deemed to have withdrawn its membership in the Authority effective immediately upon the vote of the Board approving an amendment to this Agreement if the Director representing such Party has provided notice to the other Directors immediately preceding the Board’s vote of the Party’s intention to withdraw its membership in the Authority should the amendment be approved by the Board. As described in Section 7.3, a Party that withdraws its membership in the Authority in accordance with the above-described procedure may be subject to continuing liabilities incurred prior to the Party’s withdrawal. In the event that the Authority decides to not implement the CCA Program, the minimum percentage vote of 67% shall be conducted in accordance with Section 4.10 rather than Section 4.9.1. 8.5 Assignment. Except as otherwise expressly provided in this Agreement, the rights and duties of the Parties may not be assigned or delegated without the advance written consent of all of the other Parties, and any attempt to assign or delegate such rights or duties in contravention of this Section 8.5 shall be null and void. This Agreement shall inure to the benefit of, and be binding upon, the successors and assigns of the Parties. This Section 8.5 does not prohibit a Party from entering into an independent agreement with another agency, person, or entity regarding the financing of that Party’s contributions to the Authority, or the disposition of proceeds which that Party receives under this Agreement, so long as such independent agreement does not affect, or purport to affect, the rights and duties of the Authority or the Parties under this Agreement. 8.6 Severability. If one or more clauses, sentences, paragraphs or provisions of this Agreement shall be held to be unlawful, invalid or unenforceable, it is hereby agreed by the Parties, that the remainder of the Agreement shall not be affected thereby. Such clauses, sentences, paragraphs or provision shall be deemed reformed so as to be lawful, valid and enforced to the maximum extent possible. ---PAGE BREAK--- 8.7 Further Assurances. Each Party agrees to execute and deliver all further instruments and documents, and take any further action that may be reasonably necessary, to effectuate the purposes and intent of this Agreement. 8.8 Execution by Counterparts. This Agreement may be executed in any number of counterparts, and upon execution by all Parties, each executed counterpart shall have the same force and effect as an original instrument and as if all Parties had signed the same instrument. Any signature page of this Agreement may be detached from any counterpart of this Agreement without impairing the legal effect of any signatures thereon, and may be attached to another counterpart of this Agreement identical in form hereto but having attached to it one or more signature pages. 8.9 Parties to be Served Notice. Any notice authorized or required to be given pursuant to this Agreement shall be validly given if served in writing either personally, by deposit in the United States mail, first class postage prepaid with return receipt requested, or by a recognized courier service. Notices given personally or by courier service shall be conclusively deemed received at the time of delivery and receipt and by mail shall be conclusively deemed given 48 hours after the deposit thereof (excluding Saturdays, Sundays and holidays) if the sender receives the return receipt. All notices shall be addressed to the office of the clerk or secretary of the Authority or Party, as the case may be, or such other person designated in writing by the Authority or Party. Notices given to one Party shall be copied to all other Parties. Notices given to the Authority shall be copied to all Parties. ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- Exhibit A To the Joint Powers Agreement Marin Energy Authority -Definitions- “AB 117” means Assembly Bill 117 (Stat. 2002, ch. 838, codified at Public Utilities Code Section 366.2), which created CCA. “Act” means the Joint Exercise of Powers Act of the State of California (Government Code Section 6500 et seq.) “Administrative Services Agreement” means an agreement or agreements entered into after the Effective Date by the Authority with an entity that will perform tasks necessary for planning, implementing, operating and administering the CCA Program or any other energy programs adopted by the Authority. “Agreement” means this Joint Powers Agreement. “Annual Energy Use” has the meaning given in Section 4.9.2.2. “Authority” means the Marin Energy Authority. “Authority Document(s)” means document(s) duly adopted by the Board by resolution or motion implementing the powers, functions and activities of the Authority, including but not limited to the Operating Rules and Regulations, the annual budget, and plans and policies. “Board” means the Board of Directors of the Authority. “CCA” or “Community Choice Aggregation” means an electric service option available to cities and counties pursuant to Public Utilities Code Section 366.2. “CCA Program” means the Authority’s program relating to CCA that is principally described in Sections 2.4 and 5.1. “Director” means a member of the Board of Directors representing a Party. “Effective Date” means the date on which this Agreement shall become effective and the Marin Energy Authority shall exist as a separate public agency, as further described in Section 2.1. ---PAGE BREAK--- “Implementation Plan” means the plan generally described in Section 5.1.2 of this Agreement that is required under Public Utilities Code Section 366.2 to be filed with the California Public Utilities Commission for the purpose of describing a proposed CCA Program. “Initial Costs” means all costs incurred by the Authority relating to the establishment and initial operation of the Authority, such as the hiring of an Executive Director and any administrative staff, any required accounting, administrative, technical and legal services in support of the Authority’s initial activities or in support of the negotiation, preparation and approval of one or more Administrative Services Provider Agreements and Program Agreement 1. Administrative and operational costs incurred after the approval of Program Agreement 1 shall not be considered Initial Costs. “Initial Participants” means, for the purpose of this Agreement, the signatories to this JPA as of May 5, 2010 including City of Belvedere, Town of Fairfax, City of Mill Valley, Town of San Anselmo, City of San Rafael, City of Sausalito, Town of Tiburon and County of Marin. “Operating Rules and Regulations” means the rules, regulations, policies, bylaws and procedures governing the operation of the Authority. “Parties” means, collectively, the signatories to this Agreement that have satisfied the conditions in Sections 2.2 or 3.2 such that it is considered a member of the Authority. “Party” means, singularly, a signatory to this Agreement that has satisfied the conditions in Sections 2.2 or 3.2 such that it is considered a member of the Authority. “Program Agreement 1” means the agreement that the Authority will enter into with an energy service provider that will provide the electricity to be distributed to customers participating in the CCA Program. “Total Annual Energy” has the meaning given in Section 4.9.2.2. ---PAGE BREAK--- Exhibit B To the Joint Powers Agreement Marin Energy Authority -List of the Parties- City of Belvedere Town of Corte Madera Town of Fairfax City of Larkspur City of Mill Valley City of Novato City of Richmond Town of Ross Town of San Anselmo City of San Pablo City of San Rafael City of Sausalito Town of Tiburon County of Marin County of Napa ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- Agenda Item No. 6(A) Attachment 4 ---PAGE BREAK--- OFFICE OF THE CITY CLERK CITY HALL 10890 San Pablo Avenue, El Cerrito, CA 94523-3034 Telephone (510) 215-4305 Fax (510) 215-4379 http://www.el-cerrito.org December 16, 2014 Regular City Council Meeting Agenda Item No. 6(A) Attachment 5 - MCE's Audited Financial Statements for Years Ended March 31, 2014 and 2013 http://www.marinenergyauthority.com/sites/default/files/key- documents/MCE%20Financial%20Statements%202014%20%202 013.pdf Attachment 6 - MCE 2014 Integrated Resource Plan http://marincleanenergy.org/sites/default/files/key- documents/2014_Integrated_Resource_Plan.pdf Hardcopies are available for review at: Office of the City Clerk and The El Cerrito Library 10890 San Pablo Avenue 6510 Stockton Avenue El Cerrito, CA El Cerrito, CA (510) 215-4305 ---PAGE BREAK--- 1 Dec. 8th, 2014 Dear Mayor Friedman and City Council Members, Thank you for directing City staff to pursue community choice aggregation (CCA) membership with Marin Clean Energy (MCE) for their 2015 membership cycle. I enthusiastically support the adoption of an ordinance to join a CCA program under MCE. Doing so provides El Cerrito businesses and residents a democratic choice to express their values regarding the source of their electric power, which they do not enjoy today. The default MCE power portfolio delivers a higher fraction of renewable energy with lower bills, and offers the possibility to purchase 100% renewable power (“opting up”) for a small premium. Joining MCE will dramatically increase the fraction of renewably sourced electrical power consumed in El Cerrito. This stands to be the single largest and fastest action to contribute to meeting our Climate Action Plan (CAP) goals. Based on recent greenhouse gas (GHG) inventories, showing significant progress toward meeting our 2020 CAP target, joining MCE should easily make up the remainder and put us on the path to exceed our GHG emission goals. Risks associated with pricing changes have been identified in the thorough CCA membership analysis that has been prepared. It is important to recognize that there are also similar risks associated with the status quo. In fact, there is typically less risk when a consumer has a choice, so the CCA option should not be considered highly risky compared to what we have today. CCA and MCE are well proven and are based on a open and transparent public representation process. While it is clear there is a significant advantage for solar net-metering customers who own their solar equipment, going forward, it would be useful to clarify the implications of CCA transition for solar net-metering customers who have engaged a residential solar lease rather than direct ownership of their home solar system. This detail has not been clear in previous presentations. I do not expect it to be a problem, but I look forward to avoiding any confusion that might diminish enrollment or cause negative impressions of the program. As a member of the Environmental Quality Committee I expect to actively participate in the public education and outreach performed by MCE to ensure high rates of enrollment and opting up. Richmond achieved impressively high rates of enrollment including the highest voluntary opt-up enrollment in MCE service territory. El Cerrito should strive to meet or exceed those achievements and I will work as a volunteer to help make that happen. Sincerely, Howdy Goudey 635 Elm St. El Cerrito, CA 94530 Agenda Item No. 6(A) Attachment 7 ---PAGE BREAK--- 1 Cheryl Morse Subject: FW: CCA Community Workshop Attachments: Appx A from 2013_Integrated_Resource_Plan-1.pdf From: Betony Jones [mailto:[EMAIL REDACTED]] Sent: Wednesday, December 03, 2014 12:47 PM To: Maria Sanders Subject: CCA Community Workshop Hi Maria, I hope to make it tonight, but I have a competing commitment. I wanted to get my CCA thoughts to you. I like the promise of CCA, but I am skeptical that it can deliver on all fronts (keeping rates competitive, accelerating the transition to local renewables, creating good jobs, etc.) MCE relies on unbundled and voluntary RECs to meet their green power claims. (see attached). They do not yet appear to be doing as well as PG&E in terms of meeting the RPS, and if we were to get more local renewable energy, I think costs would go up. That is fine for people like me, but not so good for the business or low-income community. People can opt out of course, but if we go with CCA, we want it to be successful, i.e. not result in high opt-out rates, which would kill it permanently. Buying power from Shell is actually worse than from PG&E, from a social responsibility perspective. I know they are both corporate entities whose profits go to shareholders, but PG&E has a far better record on labor relations, and environmental and social responsibility. I know Shell is a means to an end, but I would like to see quicker and more aggressive moves toward that end than we have so far seen with MCE. The jury is still out on whether the CCA model is better for consumers, the community, and the environment than PG&E. I also wonder how permanent the arrangement would be. It might make sense to wait to see where Alameda County goes. How much voting power would El Cerrito have-- could we actually influence their business decisions? --Betony Betony Jones 1205 Navellier St Agenda Item No. 6(A) Attachment 7 ---PAGE BREAK--- MCE Integrated Resource Plan November 7, 2013 Page 23 of 23 Appendix A: Load and Resource Tables 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Energy Requirements (GWh) Retail Load 1101 1275 1275 1275 1275 1275 1275 1275 1275 1275 New Energy Efficiency and Distributed Generation (23) (40) (63) (85) (107) (129) (152) (174) (196) Retail Load (Net of EE/DG) 1,092 1,252 1,235 1,212 1,190 1,168 1,146 1,123 1,101 1,079 Distribution Line Losses and Unaccounted For Energy 66 75 74 73 71 70 69 67 66 65 Total Energy Requirements 1,158 1,328 1,309 1,285 1,261 1,238 1,214 1,191 1,167 1,144 Renewable Energy Content Light Green 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% RPS Qualifying 27% 27% 27% 27% 27% 29% 31% 33% 33% 33% Deep Green Participation 1% 3% 3% 3% 4% 4% 4% 5% 5% 5% Overall MCE Renewable Energy Content (RPS and Voluntary) 51% 52% 52% 52% 52% 52% 52% 53% 53% 53% Renewable Energy Requirements( GWh) PCC 0 (SENA P1) 39 39 14 - - - - - - - PCC 1 (Bundled, In-State) 128 194 208 213 241 254 266 278 273 267 PCC 2 (Bundled, Firmed and Shaped) 64 60 64 65 48 51 53 56 55 53 PCC 3 (REC Only) 64 45 48 49 32 34 36 37 36 36 Subtotal, RPS Renewable Energy Requirements 295 338 333 327 321 339 355 371 363 356 Voluntary Renewable Energy Certificate Requirements( GWh) Light Green Volume 251 288 284 279 274 245 218 191 187 183 Deep Green Incremental Volume 5 19 20 21 21 22 23 28 29 29 Subtotal, Voluntary RECs 257 307 304 299 295 267 241 219 216 213 Conventional Energy Requirements (includes energy w/ unbundled RECs) 927 1,034 1,023 1,007 972 933 895 857 840 823 Renewable Resources Under Contract (GWh) Baseline (SENA P1) 39 39 14 - - - - - - - PCC 1 - - - - - - - - - - SENA P2A - 3 2 - - - - - - - G2 Hay 6 12 12 12 12 12 12 12 12 12 G2 Ostrom 5 13 13 13 13 13 13 13 13 13 Cottonwood - - 63 63 63 63 63 63 63 63 SENA P2B 74 58 19 - - - - - - - Genpower 34 34 34 34 34 34 34 34 34 34 RE Kansas - - 40 46 49 - - - - - SENA P3 - - 43 60 - - - - - - SR Airport 2 2 2 2 2 2 2 2 2 2 Calpine ST - 26 - - - - - - - - Calpine LT - - - - 88 88 88 88 88 88 Subtotal PCC 1 121 148 228 230 261 212 212 212 212 212 PCC 2 SENA P2A 13 15 6 - - - - - - - SENA P2B 49 35 12 - - - - - - - SENA P3 - 10 47 51 - - - - - - Subtotal PCC 2 62 60 65 51 - - - - - - PCC 3 - - - - - - - - - - OneEnergy 38 - - - - - - - - - Middle Fork ID 22 11 - - - - - - - - Subtotal PCC 3 60 11 - - - - - - - - Subtotal, RPS Renewable Resources Under Contract 282 258 307 281 261 212 212 212 212 212 Voluntary RECs Under Contract 3 Degrees - - - - - - - - - - OneEnergy 250 - - - - - - - - - Subtotal Voluntary RECs Under Contract 250 - - - - - - - - - Open Position, RPS Renewables (GWh) PCC 1 7 47 (20) (17) (20) 42 55 66 61 55 PCC 2 2 14 48 51 53 56 55 53 PCC 3 4 34 48 49 32 34 36 37 36 36 Subtotal, Open Position, Renewables 13 80 27 47 61 127 143 159 152 144 Open Position, Voluntary RECs 7 307 304 299 295 267 241 219 216 213 Conventional Resources Under Contract (GWh) SENA Shaped Energy (Net of SENA RE and Unit Specific) 808 977 960 946 920 - - - - - WAPA Base Resource 0 0 25 25 25 25 25 25 25 25 Donnells Hydro 110 0 0 0 0 0 0 0 0 0 Subtotal, existing Conventional Resources 918 977 985 971 945 25 25 25 25 25 Open Position, Conventional Energy (GWh) 9 57 38 36 27 908 870 832 815 798 Total Energy Under Contract (GWh) 1,140 1,224 1,292 1,252 1,206 237 237 237 237 237 Net Open, All Physical Energy (GWh) 18 104 17 33 56 1,001 978 954 930 907 Total Energy Contract Coverage 98% 92% 99% 97% 96% 19% 19% 20% 20% 21% Marin Clean Energy Resource Balance October, 2013 Agenda Item No. 6(A) Attachment 7