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Consent-General Government # 14.
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| Board of Supervisors |
Financial Services |
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| Subject |
| Authorize the Assistant County Administrator and/or Chief Financial Officer to apply for the Self Generation Incentive Program and authorize related deposit. (No general fund impact) (Rinde/Nunes) |
| Recommended Action |
- Authorize the Assistant County Administrator and/or the Chief Financial Officer to apply for the Self Generation Incentive Program (SGIP); and
- Authorize the Chief Financial Officer to process the related required refundable deposit of 5% of the SGIP Project cost.
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| Strategic Plan Goal(s) |
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Sustainable Environment |
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| Reason for Recommended Action/Background |
In December, 2017, the County issued a request for qualifications for Energy Conservation Performance Contracting and selected Trane, Inc. Subsequently, Trane reviewed County facilities and utility costs including the solar program. As part of the review of the solar program, options were reviewed in the Investment Grade Audit (IGA) (Attachment A) for options related to Battery Storage solutions that would improve the County's energy program in light of changes being implemented regarding PG&E Time-of-Use (TOU) rate structures.
A critical component in order to determine the feasibility of the proposed battery storage project involves what rebates and incentives are available, potential revenue that may be generated from an agreement with a load serving entity (LSE), as well as reductions in electrical expense attributable to utilization of battery storage instead of PG&E market rates during peak load periods. The California Public Utilities Commission (CPUC) makes funding available annually through a Self Generation Incentive Program (SGIP) which may be able to provide rebates and incentives for a large portion of the proposd project cost. The amount will depend on the categorization of the project and whether the CPUC concurs that the project addresses critical infrastructure needs and that Yolo is a disadvantaged community (according to the SGIP criteria). In order to determine whether the project will ultimately be feasible, the County needs to apply with the Battery storage project scope to the SGIP program on April 1, 2020. Thus, County staff are seeking approval in order to allow the Assistant County Administrator and/or Chief Financial Officer to submit an application to the SGIP program.
The SGIP Program requires a deposit of 5% of the total project cost which is refundable should the project not proceed. The estimated size of the project is currently $6.45 million (which reflects minor changes from the IGA) and thus the size of the deposit that is required to accompany the application is estimated to be $322,500. This cost would be advanced from Yolo Electric Internal Services Fund. As the deposit is refundable, a budget resolution is not being brought forward at this time and will accompany the larger project when financial feasibility analysis is accomplished. As mentioned previously, Yolo County is under no obligation to proceed with the project either as part of the SGIP program or to pay any costs to Trane associated with project development to date.
County staff expect to hear back regarding the SGIP conditional award toward the end of April, 2020. Concurrently, Trane has been authorized to begin to submit offers to Load Serving Entities (LSE) to determine any potential revenue available from load serving entities related to the project. This is expected to take approximately 90 days and a full project pro-forma is expected to be available approximately June or July of 2020. County staff will then determine based on the incentives as part of the SGIP program and any LSE revenues attributable to the project whether to proceed at that time. Staff expect at that time a touch base will likely occur with the Committee on Capital Investments and potentially the Debt Committee (depending on the financing plan) before coming back before the full board for approval. |
| Collaborations (including Board advisory groups and external partner agencies) |
| Financial Services has collaborated with the County Administrator's Office, General Services Department, County Counsel and with Trane, Inc. as the County's Energy consultant. |
| Competitive Bid Process |
| Not applicable. |
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| Fiscal Impact |
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| Source of Funds for this Expenditure |
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Explanation (Expenditure and/or Revenue) |
| Further explanation as needed: |
| As part of the submission of an Application for the SGIP Program, a 5% refundable required deposit needs to be submitted to the CPUC. Should the project not proceed, the deposit would be returned. For purposes of the deposit, Yolo Electric funds will be utilized for the deposit. |
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