>> my name is david gray. i'm the sierra energy chair, new at that. i wanted to say thank you so much for going ahead and reading our letter expressing our concerns about the program. the sierra club is supportive, we really want to see this program woour main concern is tn by engineering background, i think of things very much in terms of black-and-white. if the terms are not accurately laid out, you're not guaranteed hogging the result you're actually wahoo wanting. -- you aractually want.

generating revenues in the city itself, and also to address global warming. lead to be generating our own power whenever possible. it is in your hands to be able to put that forward. we would like to see this done and a fixed your in the commission if at all possible before it goes to the board of supervisors. it would be an ideal situation for us. and with that, i think i will conclude early. happy holidays. >> i am from the local clean energy alliance. thank you, everybody, for the

concerted efforts around the community choice program. i wanted to echo what others have said and what commissioner torres introduced, having language that makes this particular contract contingent on the development of a plan that is in the works. they are investing a good deal of money around the research and formulation of a developmental effort that will result in the economic development of energy resources in san francisco and the jobs that will come from that. and from that work, the fashioning of a roll out plan that will be the most optimal for the citizens of the city. part of the construction of the total package has to do with how you leverage various resources,

energy efficiency resources, creating a rule out that optimizes our ability to sell this program to the folks in san francisco. folks in the city are very concerned about pricing. they're very concerned about the question of jobs. big leg which -- including language in the resolution upon an explicit plan for framework, who within the 4.5 years, it is reasonable to explain how the local build up will unfold to make it explicit upon that kind of a plan. and upon the types of jobs and economic development that the plan expresses, and the price points that would influence a

rollout strategy for that plan. putting this plan forward as it is, it is absent the work that is going on and a little bit like the card before the horse. we are definitely in favor of moving the process forward, but with the express written assurance that the final contract is dependent upon the work that is being funded right out with the investigative stuff. i don't know if someone has written down specific language, but we would like to see something more explicit in the resolution. >> any other additional public comment? it is in the hands of the commission. >> would you mind coming up

again? i think i have an amendment here, but i want to make sure that there is a piece that you said -- i just want to hear it one more time. >> for the record, i am not a lawyer. what i thought of after hearing that the commissioners because final approval of the contract conditional on an express plan for local build up with a rate plan that will reflect that plan and a rollout that launches the maximum number of customers in the rate base possible. >> thank you so much.

president moran: i am wondering if there is a path through this item. oen is but this -- not one is put this on hold for nine months vs was presented to us which is to proceed with the contract that meets the term she requirements that we agreed to at the prior meetings. i guess i am hearing an attempt to try to do both, and my first question is, can both be done? she points out that if we seek to amend the contract, that would have ceqa implications that we would have to deal with. if we have a resolution that includes a whereas, committing ourselves to the lumber program, it reaffirms our long-

term intent but does nothing to alter the specific build up that has been -- roll out that has been proposed to us. where would we like to go? >> i would like to introduce an amendment to the resolution which would read as follows. >> i second that motion. >> of the puc reaffirms its commitment to the local home builders out components-- local buildout program to the cca program. whereas the puc anticipates the immediate commencement of b the localuildout -- of the local buildout. generation revenues identified and the sfpuc approves a budget

and timeline for the local bill the -- buildout. >> can that be accommodated with c in the existeqa stand -- within the existing ceqa standards. >> if you are saying that when you enter into this contract that you are unequivocal making discretionary decision now that a local buildout that is not defined as something to you are obligated to do, then you should add language that makes it clear that there will be some subsequent decision by the commission and the board that you are exercising that your sole discretion to decide if, where, and how you will make

physical changes of you can have appropriate mitigation measures. it might be part of the study that you have commissioned that is supposed to be under way for the next nine months to frame the physical build up so you can consider the environmental impact. we can draft language that will reserve your discretion to review all of that, but i can't do it yet. it is impossible that we can take a break while we do some other things and i can get some people to write that? it might be helpful especially because this is a contract, at least the preliminary contract approval going to the board, you have partners. it might be nice to show them how we are going to amend the

approval of the resolution. >> i don't think we are amending the contract. that is not the intent of this apparel. and the way i heard her read that, i thought was expressions of intent, not commitments to do. if you read it one more time, it might assuage your concerns. >> i was thinking a short break might be in order now in any event. why don't we do that, and to give the city attorney a chance to look at the language. my hearing of it was the same as yours and hopefully it will get us where we need to go. without objection, we'll take a short break and reconvene at 2:00.

president moran: we are back in session. we have a draft and that the city attorney has been able to review. if i could have somebody read it. >> i will read it. whereas -- and i am not exactly sure, i guess it should be inserted after the fourth whereas on page 8. does that make sense? >> it is shirley page to, but it is really page 8. -- is really page two, but it is really page 8. >> after achieving this city

because the goals -- city's goals. the puc reaffirms its commitment to pursue the local who billed out component of -- local buildout component of the cca. and whereas the puc anticipates the immediate commencement of the local buildout. once the have completed their scope of work, sufficient revenues are identified, the sfpuc considers the environmental analysis of any physical impact of the local bellout -- buildout program, and approves the budget and timeline for the local buildout. president moran: any questions from the commission on that language? >> second.

president moran: procedurally, we don't have anything to make an amendment to yet. let's just do this and a simple way and tell me if it doesn't stand up. let's vote on the language, we can move the replacement resolution that includes that language. >>-secon i can second it. >> are we going to have public comment on the proposed amendment? >> i think we should. president moran: ok. do you want to move the other amendments then? >> why don't we do that?

>> other coveys of this, the ones that came into the meeting? president moran: the commission was given substitute language at the beginning of the meeting. the mover and seconder agreed that what is before the mission is the entire resolution, including the changed language -- and >> yes. sounds fine. >> commissioner, would it be useful for me to mention with those three small changes are in the amendments? president moran: yes, please. >> the first is the noble american contract said before that it had to be by the puc and board of supervisors. it does not have to go to the board. it has to go to the puc. the second is that we did not have ceqa language. we added ceqa language, adding that it would be covered.

the third is to be even more clear. it says the puc will only authorize the general managers to launch the program as long as it is a per by the board of supervisors and the following conditions are met to the satisfaction of the puc, and the same language stays in there. we wanted to make sure that is on the record. president moran: ok. so what is before the commission is the substitute resolution with the addition of the two whereas clauses that were just read earlier. ok. public comment on that item? >> good afternoon again, commissioners. san francisco green party and the local grassroots organization of our city. a few things on the amendments that you're going over. an important one is the ceqa issue. what we're seeing out here is that we need the final approval

of the shell contract and the program that is being based on it to be contingent upon the build out work -- and by the way, not necessarily the full nine to 11 months, but enough of the build of work being completed in five or six months to inform of the economics of the contract will work. we're not saying that the contract needs to be changed so that it is adopting construction and installation. we are saying that once we flesh out that build-out information sufficiently and, like we said, get the horse before the cart sufficiently, what we learned about how we're going to build the build-out will give us tools to radically affect the economics is some tiny shell contract. i do not believe that is a ceqa issue. because it is not asking for changes in infrastructure. it is just got to change the financial structure and

agreement. this was just a procurement contracts. maybe the city attorney will correct me on that, but i have a feeling that we can chart a territory there. i would just repeat, for my member groups, that what we said before, which is that we need this to proceed in a way that that build-out study work will be carefully integrated with the progress of a shell contract before it is finally approved, so that those economics will work out properly. so that we can get the economics of a large asset base that brings in revenue and a lot of revenue for solar efficiency and more to affect it. that is what we're getting at, that is where we need to move forward. and you should really look this over and decide whether you are able to move that forward today or not. thank you. president moran: thank you.

any other public comment? >> as part of the substitution cause for the contract, is there something in there that says once a local service is identified and it is generating that that would substitute not just a power source but would also shift the economic formula? >> it gives us the ability to substitute -- it is not -- it does not require it, because we also think that it might be bringing on new customers at the same time, and we actually need the generation, not the substitute, that allows for that kind of flexibility. then you decide whether you're changing rates based on that. it depends on whether you're substituting or whether you are adding. this is flexible enough to do both. but it is not directing one of the other, leaving it up to the flexibility of the commission to make that decision. >> and this is a four and a half

year contract? >> right. >> thank you. >> so far from the local clean energy alliance. i want to thank you all for the efforts to try to include in a very prominent way the local build-out work in the importance of doing that work as part of the clean power sf piece overall. i want to clarify what might still be a mystery about the relationship between the investigative work going on now by local power inc., and that might conceivably end up in the contract as a result of that work. said the contract, as is now, specifies a certain type of energy that would be purchased. it will specify a price at which that energy will be purchased. it will specify a certain amount of energy that will be purchased.

those are pieces where once the local bell about estimations edward r. dunne might have some influence. to give you an example, in terms of the normal load that the city has, it has peaked at certain points in time. say a certain time of year or a certain time of day, there is a maximum peaking point, if your capacity has to match that, you're going to pay a price that represents the peak power that will have to be produced. if you have a build-out plan with energy efficiency and demand reduction measures that shaves down the peak in a substantial way, then, presumably the price you pay for power should be different because you're not having to contract for the same level of capacity that you did before. i am just trying to express in a way were the information that is being developed now could conceivably have an impact on what you decide to contract a

few months down the line. that was the notion of making the contracts that are contingent upon those studies. i think what you're expressing is the commitment to move forward with a local build-out plan and a longer term plan in clearly would not be in your interest once you have that landing to the contract with terms that are into that a call to those interests. i am trying to lay out a little bit about how the investigative work could conceivably influence either the price points or the amount of energy you buy or other points like that. we think there is a commitment to move them forward, and i wanted to make that clarification. >> i want to respond and thank all of the activists and stakeholders for the letter in bringing this before us continuously. we hope that as the information does become more apparent and

the data is collected, we can take steps to adjust accordingly. because i think there's a strong commitment on the part of this commission and the city families. supervisor campos represents that, too, to really recognize that local build-out is key. we want to continue to hear from you on where we can make adjustments if necessary, and hopefully this language will at least get us to the next step in moving this program forward. president moran: thank you. any additional public comment? >> hello again. thank you for incorporating language. one thing, forgive me if i missed it, i did not hear the commitment to making sure the maximum number of rate-payers come on. what we are risking here is if you want a program that is 100% renewable. this is the economics that some of the advocates are speaking about.

you might get a very high opt- out rate. this could only be for people signing on and not opt out because it is harder to court those repairs once we have already started a program. president moran: thank you. one of the things that is still outstanding to the commissioner, please send it out to the program. there are several times that we could address that. the time it would have to address it is when it comes back in march for the go, no go. that is also the time when we will look at any other new information that we have, so i think it comes out of the second track for local build out and would be in front of the commission at that time. we have retained authority to change the size of the program or incorporate new information as it comes to us. that would be the time that it

would naturally come together. the question would be, is the local build-out sufficiently developed that we can act on it at that time are does that have to be an action? >> we have a motion. we have a second. we have had public comment. and the other questions? >> ok, all those in favor? opposed? the item passes. thank you. >> thank you, commissioners. it has been seven years, right? president moran: that is item 12? >> yes. president moran: we skip over items 10 and 11. 11 is my intent to call toward the end of the meeting after we have had the budget workshop. i believe mr. chang is with us.

if you could call 10. we're trying to keep this moving. >> item 10, presentation discussion of the rate fairness report and presentation on municipal power rates. shall i call 13 as well? president moran: um, no. >> in that case, let me run through quickly item 10. i am a member of the raid prepared this board. i would like to quickly give background on the board, the numbers, and our findings for rates for men is about power. in your presentation on page two.

let me put this on the overhead. the rate fairness board was in november 2002 by 2002e, designed to set forth rate policies for the city. it is an advisory body from the charged with quoting public hearings in making rate policy recommendations to the puc. members of the board consists of four members of the polish, two appointed by the mayor. two from the board of supervisors. three members of the city departments. administrator, controller, and the office of public finance. this year, we had process for reviewing and is about power rates. in doing so, we had four meetings this quarter. in numbers were very engaged. we had many presentations from staff, and we have been able to engage staff with a number of

inquiries that we have had. there has been the minted public comment before the rate fairness board. as such, the recommendation that we may a the representation of the rate fairness board and their members with limited public comment. that being said, the rate fairness board generally as guiding principles in fulfilling its responsibilities and determined the rates, as part of the charter section are to improve and maintain the financial condition and the ratings, to provide sufficient resources for the continued financial health, operation and maintenance and repair of the enterprise, and be based on the cost of service. just a way of background. rates have been currently in place since 1989. it has been limited rate increases since then. we're proposing rate increases

today. to put them in context. the first major increases for about 12 years. the context of the rate increase are to look at the booking options. the two book-ends are the two cents rates over two years or 4 cents over four years. primary drivers are two cents and four cents to ensure that the rate scale fund and the puc maintains operations to a prudent level. as recommended by staff. in both scenarios, the prudent level will be restored. however, if it should dip below 2 cents, that stabilization fund would not be maintained. that is not the point we're advocating as part of the board. what we're advocating is to look somewhere between that two cents and 4 cents, between full restoration of the capital programs and limited or no restoration.

key questions we have asked in evaluating were that recommendation should be between two cents and 4 cents is, the first question is, is it fair to have the $90 million in capital programs funded through general fund department bills? the second question is to what degree should the rate fairness board, in its recommendations, be sensitive to the current fiscal condition, fiscal constraints of the general fund department? in both cases, we believe there should be a balance between the two. it is basically a balance of the trinity debt. what the refairness board believes is in adding back then i'm million dollars in capital programs, where do we at and how do we add is, first, to make sure there is a public-sector benefit. second, do have and us