HomeMy WebLinkAboutAgenda Report - May 6, 2020 C-10c4oAGENDA ITEM
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AGENDA TITLE:
MEETING DATE
PREPARED BY:
Adopt Resolution Authorizing City Manager to Execute the Participating Electric
Distribution Utility Joinder to the Clean Fuel Reward Program Governance
Agreement
May 6, 2020
Electric Utility Director
RECOMMENDED ACTION:
BACKGROUND INFORMATION:
Adopt a resolution authorizing the City Manager to execute the
Participating Electric Distribution Utility (EDU) Joinder to the Clean
Fuel Reward (CFR) Program Governance Agreement.
The Clean Fuel Reward (CFR) Program is a statewide point-of-
purchase rebate program for new electric vehicle (EV) purchases,
required by the Low Carbon Fuel Standard (LCFS) Regulation.
This instant rebate will be available at any participating car dealership within the state and is funded
entirely by a percentage of utilities' LCFS credits resulting from residential EV charging. EDUs
participating in the LCFS Program are required to enter into the CFR Program Governance Agreement
and comply with the regulatory requirements regarding the CFR Program as required by the California Air
Resources Board (CARB).
The CFR Program Governance Agreement establishes and defines the oversight and administrative
structure for the CFR Program, the Steering and Advisory Committees, the solicitation process for
selecting program implementers, cost sharing and transfer schedules for program costs, and various risk
mitigation measures. On January 7,2020, the California Public Utilities Commission (CPUC) formally
approved a final version of the CFR Program Governance Agreement. As a LCFS Program EDU
participant, Lodi Electric Utility (LEU) is required to join the CFR Program Governance Agreement via the
Participating EDU Joinder.
Southern California Edison (SCE) will administer the program by retaining and overseeing third-party
implementers, including: (1) a financial institution to receive and hold the participating utilities' LCFS
revenues and distribute to dealers the reimbursements for point-of-purchase LCFS rewards; (2) an
independent accounting firm to perform regular audits; and (3) one or more program implementers to
engage in marketing, establish an online tool, and perform necessary administrative functions. lt is
anticipated the CFR Program will commence Fall 2020.
To fund the CFR Program expenses, LEU is required to annually transfer two percent of residential LCFS
credit proceeds, estimated at $1,800, beginning in 2A23. Additionally, participating utilities are required to
transfer a percentage share of $50 million for the initial start-up costs of the CFR Program's starting
balance. LEU's initial contribution is $14,574, to be transferred by January 2023.
Since joining the LCFS Program in 2018, LEU has received 623 credits with an estimated market value
o1g112,140. These credits are based on current metered charging and unmetered residential EV
AppRovEo. Steve Schwabauer
Stephen Schwabauer, CitY Manager
Adopt Resolution Authorizing City Mâneger to Execute the Participating Electric Distribution Ut¡lity Joinder to the Clean Fuel Reward Program Governance Agreement
May 6, 2020
Page 2
charging estimated by CARB based on the number of registered EVs in LEU's service territory. LCFS
credit proceeds can be used to supplement existing funding for EV incentive programs and other
electrification efforts.
Participation in the CFR Program is a requiremerìt for LEU to continue receiving LCSF credits. The Risk
Oversight Committee received a report on the CFR Program Governance Agreement and Participating
EDU Joinder at its April 21 ,2020 meeting.
FISCAL IMPACT:
FUNDING AVAILABLE:
PREPARED BY: Jiayo Chiang, Electric Utility Resources Analyst
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$14,574 initially and approximately $1,800 annually thereafter.
The initial contribution and two percent annual contribution will be funded
by LEU's LCFS credit,proceeds.
And rew Keys
Andrew Keys
Deputy City Manager/lnternal Services Director
Jeff Berkheimer
Jeff Berkheimer
Electric Utility Director