>> okay, we are back in business, the low agency formation commission, john avalos and our commissions have been introduced, jennifer low, madam clerk, can you call our next item, please. >> item number 2 is approval of lafco minutes from january 25, 2013 regular mooting. there are amendments that need to be made to the minutes, on item number 3, commissioner schmeltzer was absent and item number 6, same thing. >> okay. so, we could take those amendments after we open up for public comment. public comments on the minutes, and seeing no one come forward,

we'll close public minutes, can we change those things on the minutes. seconded by commissioner breed, we'll take that without objection. thank you, madam clerk, if you can call your next item. >> item number 3, community choice aggregation activities report, a, status update on clean power sf program, b, status update on proceedings at the california public utilities commission. >> thank you very much and we have presentations from barbara hale of the pcp and nancy miller from lafco, i didn't see you over there. >> barbara hale, assistant general manager for power, we provided some handouts that are available to the public and to the commissioners, i just wanted to give you a quick

update on three items, where things are at with the sfpuc and the california public utilities commission, the status of our customer notification and education plan and an update on our legislation related to clean energy and ms. radica fox will provide the legislative update for you, with respect to the first item, the sfpuc activities, we are progressing as planned, we are on time as our time schedule, we have rated options possible at our commission on march 12th, at that time, we'll be presenting our commission with a customer poll results, we'll be presenting the not to exceed rate for adoption and possible adoption, consideration and possible adoption and that will be accompanied with a report from the rate fairness board providing the commission with advice on those not to exceed rates.

at the california puc, we are actively engage on that setting on the proceeding that they are conducting on pg and e's proposed green tariff omtion, they proposed a 100% green power product. that product is proposed to use green e energy certificates, it's anticipated to enroll 30 thousand residential accounts, which is about .68% of eligible customers, and they are proposing this program to serve all of the customers across their service territory. they expect to reach that 30 thousand enrollment by the end of the third year of the program, and just by way of comparison, we're talking about enrolling in our clean power sf program 50 to 90 thousand residential accounts day 1, you know, and that's in part

because our program is an opt-out program, the green tariff option program pg and e is proposing is an opt-in pro program so it's projected that the differences that i communicated to you are pretty fair to assume given that that key difference in the enrollment strategies. pg and estimating is estimating their price premium to be about 6 dollars a month if r the average residential customer in pg and e territory, the proceeding had been put on hold in order to allow parties to come to agreement on pg and e's propose sal and all party settlement was not reached, and evidentiary hearings are scheduled march 19-31 at this point, there's going to be a rehearing conference at the california pu next week and

that will give us a update, we don't expect to see a puc on this green tariff option until 2014, although there isn't an all party settlement, there are parties included in talk to pg and influence. >> can you describe a bit more about what type of service they're going to have, so if a person signs up for their green e energy certified renewable energy program, are they receiving 100% of their actual electricity needs through this service or u.s. j u.s. getting a portion that's getting 100% energy. >> as i understand it, those customers will receive the pg and e portfolio, soit's

renewable at about 19%, a large portion of large hydro and nuclear and then the balance provided by other power sources like natural gas. when you sign up for green e, what pg and e is proposing to do is to buy their green e certificates to green up or cover, if you will, the natural gas fired portion, the nuclear portion, the hydro portion of the service, so that it would become a 100% renewable product, but only that 19 or so percent that is rps, you know, california renewable would be comparable to what we're offering because it's certified california renewable, the balance of that portfolio would be green e certified under pg and e's proposed application which doesn't meet the same

renewable criteria that our 100% renewable portfolio meets. >> great, and the 30 thousand, is there a sense of where the residents who will sign up for pg and e's program, where they would come from, is there real effort to undercut the folks in san francisco that would sign up to our program? >> well, i would expect that pg and e will be marketing the program throughout their service territory, once it's authorized, i would expect that from the numbers they're pretbacker projecting, it's from throughout those 30 thousand accounts are throughout their service territory, since we would be marketing and educating folks about renewable energy offerings, our market may be more ready to consider that sort of option and i would expect that pg and e will be able to under the code of

conduct, we are required to provide rate comparisons that we work on together with pg and e, our program offering versus theirs and i would expect the california puc would require us to show the green e option in that comparison, so we would be sort of more actively engaged with pg and e customers in san francisco as would pg and e as perhaps to their other territories. >> our customers automatically enroll in the green e program? >> no, customers would need to elect, sign up for that program, and that's why i think pg and e is projecting such a low percentage of enroll. , pg and e did offer a climate smart project which similarly had an elect to enroll component that had very low

participation and they ultimately cancelled the program. >> will they mail them a notification to opt in with their bill, or how will the customers be notified of the option? >> i'm not sure what pg and e's marketing plan is for it, but i would assume a bill insert and those typical ways pg and e communicates would be used. that's certainly what they did with their climate smart program. >> thank you. commissioner mar? >> thank you, thank you, chair avalos, ms. hale, could you just explain what the geographical area of pg and e's territory is. er >> it serves most of northern california from about fresno north to the oregon border, from east to west, pg and e does not serve the north

eastern portion of california or parts of the sierra nevada, and the northern part of the sierra nevada range. there are imbedded within that geography, i just described publicly owned utilities, for example, redding, so that's a pocket of that broad area that pg and e does not serve. >> but would you anticipate that a lot of their 30 thousand residential customers would probably be around berkeley and san francisco and marine county and santa cruz. >> yes, i would expect it to be coastal communities reflecting the values we see in other choices in those communities as well. >> and then you mention clean power sf will be ramped up to about 50 to 90 thousand customers on day 1, what's the current customer base of pg and e in san francisco?

>> pg and e residential accounts number 360 thousand if memory serves me, yes. >> okay, thank you. >> you're welcome, and to talk about -- >> just one more question from commissioner breed? >> i want to know if this might confuse people, if there might be some overlap from pg and e and sf power. >> i think certainly multiple campaigns advertising similar but not exactly the same products can be confusing to folks, on the upside, there will be a lot of media and interest hopefully in our program and in pg and e's, and while we may -- that may have some negative impact on the viewing audience, there will be a lot of information message being used to communicate these

choices and that's really what the clean power sf is, it's a choice program, we want folks to understand it, not to be confused by it, that will be one of our customer notification and education program challenges, but really what we want to do is make sure folks understand what the choice is, what the value of the program could be to them, what the cost of the program could be to them and we would expect that they'll be thinking about whether the pg and e option is a better way for them to go and may have questions about that as well, so there will be a communication challenge i think around those issues but it will also make sure that folks are really aware, you know, the awareness factor should be higher. >> and since we're talking about in phases, so they're going to overlap, so the ability to opt out is based on -- i mean, you're going to be rolling this program out in phases, so in some instances,

they're going to probably overlap with pg and e's plan in some of the areas? >> yeah, it's going to be in part based on how quickly we launch our program, our current timeline says we're launching our program in october of this year and how quickly pg and e receives authorization to launch their program, what's proposed is still pending, they're not authorized to launch the program, so we will begin our notification and education campaign program ourselves, you know, throughout this summer, we'll be conducting that effort to educate folks. pg and e won't be authorized probably until late this year to have their program and so they won't have the ability to address customers directly on what they have authority to offer yet. >> thank you.

>> okay. >> and just one more of the commissioners would like to, commissioner campos. >> thank you, mr. chair, and it's great to have commissioner london breed here on the local agency formation commission. just a quick question, what is our ability to actually differentiate our program in terms of information that's provided to the public from the pg and e program, you know, pg and e is talking about the use of energy credits, we're not, so if you can talk a little bit about that. >> yeah, we definitely anticipate a lower reliance on renewable energy credits than pg and e's program, so that would be one distinguishing factor. pg and e's proposal is to rely on green e certificates which are not recognized as renewable under the renewable portfolio standard law here in california.

all of the products we are proposing to offer our customers to make up the 100% renewable portfolio are considered renewable under california's rps law, so that's another key distinguishing factor and those would be the sorts of things we would be talking about, we're also talking about the fact that our program is our building block for building locally renewable resources, for employing locally to conduct that construction, and that will also be a distinguishing factor between our program and pg and e's, and we hope that will be compelling to folks to know that by choosing our clean power sf program, they'll be choosing to invest in the community and to have energy efficiency and renewable here in san francisco and on properties that san francisco controls. >> thank you, i appreciate that and i think what you said is correct and i think it underscores the importance of

the build-out in all of this because that's an important part of the marketing as well. thank you. >> thank you. and please continue. >> thank you. so, as you may know, we launched our customer survey this past weekend, and we expected to wrap up in the following week. that will be providing us with key information that we will take to the rate fairness board, to our commission, to you folks again that will help us understand customers' readiness for our clean power sf program. the survey really, the main objective is to be able to provide an updated precinct heat map that we've shown here in this setting before, that's the map of san francisco broken up by precincts that shows with color variation where the highest acceptance rates are of our clean power sf program and

that will really help us focus our efforts on locations where customers have the most interest in participating and we're testing customers through this survey to determine their general awareness and understanding of clean power sf, their willingness to pay more for 100% green renewable energy product, the likelihood of customers opting out with the not to exceed rates that we are testing, and their interest in having that opportunity to invest locally in local clean energy projects like energy efficiency and renewable generation, and then we're also going to be testing their relative interest in clean power sf versus the pg and e proposed green tariff option that i just summarized, that data should be available in early march for us to begin to share and it's one of the key

steps in an update on focusing in on the customer education component next steps for this first quarter with our newly announced or planned, perhaps it's not announced, joint puc and lafco meeting on june 25, that's going the fall within that 30 day period hopefully, if our commission decides on march 12th that it's ready to act on the proposed rates, then the 30 day period will begin shortly thereafter, and the board if it takes no action will be allowing the rates to become effective 30 days during that 30 day period, after that 30 day period, the rates would become effective, so hopefully we'll have an opportunity to engage in a dialog with our

commission and with our staff about the clean power sf program on march 25th. >> barbara, could you say how certain it is that the commission take up the rates on march 12th? >> they'll take it up by -- yes, they will be considering, and i say that assuming that all the steps that we've already gotten in place fall, you know, are taken which includes rate fairness board, getting a briefing from staff on the results of the customer survey, that's scheduled to occur on march 8th, then march 1 and 8, march 1 and 8, i should reference my more detailed schedule to make sure i give you accurate information, yes, march 1 and march 8 are the two dates the rate fairness board would have then for consideration before coming to our commission on march 12 *lt, and we're hoping

we've built in adequate time for them to be comfortable making a recommendation advising our commission and our commission will be comfortable taking action on march 12. >> and so besides the rate fairness board, do you see any other factors that could delay any kind of decisions by the commission? >> not that i'm anticipating at this point. i mean, there will be -- >> just unknown unknowns? >> yes, i don't have anything in mind. >> okay. thank you. >> and so then with that, i would like to turn it over to ratica fox to present the state legislative update if i may. >> okay, thank you, and we'll have more questions after the entire presentation. >> thank you for your presentation, barbara. >> good afternoon, commissioners, ratica fox with the sfpuc, we thought that it would be helpful to just give you an informational update about some policies that are being considered at the state

level related to clean energy, i think in the past, the puc and lafco have worked collaboratively on policy proposals being advanced in sacramento, the senator leno built focused on it being an example, i think in subsequent meetings, we'll plan on giving you more specific information as particular legislative proposals move forward. as far as the sort of broad timeline in sacramento, today is really the last day for members to introduce bills and so next week, we'll probably see 500, a thousand bills related to issues that we all care about here in san francisco. i wanted to point out really three policy issues that we think would be of particular interest to lafco, the first is around captain trade auction revenue, you all probably know that last november, san francisco -- i mean california began to create a carbon market

with cap and trade dla,, the first auction generated 280 thousand dollars in revenue, there was a second auction that year and that is generated about another 230 million just heard today, so what is happening now is california air resources board is working with the department of finance to develop a 3 year investment plan for how they propose those dollars to be spent. the three year investment plan will be shared through the governor's revised plan, the air resources board is taking both public comment and written comment around what those investment categories should look like, the puc has been working with the broader city family to try to shape some of that. our anticipation of what will

come out via the arb department of process finance is that the governor's budget may revise sal will include a broad set of investment categories and likely recommendation that various state agencies administer those funds. the legislature i think has also that their own views so we're already starting to see some bills coming out around the legislature's view and how those dollars should be spent so i think between now and the end of session in september, there are going to be i think many opportunities to weigh in on how we think those dollars should ultimately be allocated. i think some of the things we've been focused on at the puc is i think the city and the puc in particular had a strong track regard around energy efficiency and renewable generation projects particularly on public cities and for example,