and the contingency is nowcy on this project and those are the question that you saw see in the recommendation and is then some recommendations also with respect to schedule and i think one of the most important one there is meeting the level of service goals if this is the one project of all the wsip project that go along and all of the other activities including the activity not managed by lab bon labonte and her team that is what we would recommend and prefer as opposed to this plodge going along and everything else being drabbing dragd out into the future for a many number of years that is the heart of our recommendations as ms., labonte said before you were nice enough to incorporate our recommendation into your motion and i hope that is what you can do today. >> off motion mr. moran?

i move that we amend the resolution to adopt the recommendations. >> the date of the letter is january 16th 2013. >> thank you. written by bawsca. already movement and seconded public comments? . >> i would like to. you sure can. i would like to say that it was an excellent letter and brought to my issues to my

concern, and to my attention and i would like to know when we will be receiving a list of the items you just set forth in letter form that would -- [inaudible]. >> the bawsca letter outlined some deadline and i intend to meet those dead lines the other thing that i will do if you want, and if the general manager is in agreement would be to brief you every two weeks on the progresses being made but for sure as i mentioned we will ameliorate all of the dead lines and i think some of them were in the february or and i'll make sure that we meet those dead lines. >> good and i would like to add to that, that i think we should look at the five project that we have in preconstruction. yes. see if there is anything that can be done. yes, it will certainly be in the best -- that is a very good point because often once a project goes into construction is to some extent we have more control. but in preconstruction x there is the review process and there are measured potentials at time for delays

so, your vice will be taken and we will look at those as well. >> can i point out -- i just want to point out that it is a challenge that julie is facing because as the project move to completion, i think one of the best ways is to move it quickly to completion where we can eliminate all charges. the other thing is for the project that are in preconstruction we definitely try to look at ways to look at the scope or reduce the way that we would implement it to get cost savings but for the projects not only city and consult antis we are looking at redisploi those to save money as well and so it's going to be a hard time for city staff because they need to look for the waste water and look at other opportunity and work on other project. this is ending soon and i think everyone we need to

focus on our next capital project and so that is something that i'll be working julie on. . >> all right we have on the floor a motion as amendment aimed by mr. moran and seconded by mr. kane any other motion? all those in favor? motion carry,. >> item 12. >> approval the plans and specifications for contract wd 25 thrive in the a 31,372,335 is the contractor of 720 sective calendar days. i don't have any presentation, i would be happy to then answer any questions you have on this particular item. you guys are eds today all right is there a motion? >> second. public comments? all right there being on all

those in favor signify by saying aye. >> oppose? motion carries item 13. >> authorize the general manager to negotiate and execute an amendment to the 2009 water supply agreement. >> steve rich aye a manager for water and this item representseses a proposed amendment to the 2009 water supply agreement and back acheally for us to deal with as it was discussed in proposition -- that the wholesale customers as a voice or clear recourse in dealing with that situation and so we developed a mechanism so wholesale customers can be protected in the future consideration of the proposal and so it's simple providing for a future amendment and water supply agreement to make sure that we maintain the levels of

is the service that we have committed to and cost allocations there. >> any comments? commission moved fd. >> seconded by commissioner moran and now we are open to public comments and mr. rose crans. >> mr. mike martial? . >> good afternoon, welcome to the commission mr. martial. >> thank you happy new year and my name is mike martial i'm the executive director of rich -- and i wanted to begin by articulating what we do because it was loss in the roont campaign about this issue we are here today bealso believe that everyone involved and the water system the hetch hetchy water system should have a say of the

water improvements and i'm sorry this letter is late but which have we have it here we learned about this yesterday and we agree there should be a voice and this amendment is not the solution to this problem. and the reason is the city attorney is very clear that the voters of san francisco are the arrest orbiters arbitraries of the -- san francisco and it's on it's face value when you bhfer you take votes right away from certain conconstituentcy to none elected officials it problematic and secondly it can be open to litigation and the purpose of this is to protect focus it will counties and the taxpayers in san francisco and this does not

have any profession to the rate pairs or taxpayers of san francisco for any litigation that may come about as as a result of this amendment and i urge you to consider that before you pass this amendment and lastly, it doesn't involve all of the key stakeholders in this conversation. the city of california, has determined that the economic value of restoring hetch hetchy would be $6 billion annually to the people of california and therefore, i think that is 6 billion reasons why they are key stakeholders in this process and so, we would urge you would amend or revise or have more conversation truly about this issue by requiring that instead of providing veto power to unelect of the power on the peninsula require an elect toarl component to the region it may represent and put it directly to the voters of the from a and if you are going to veto the will of the voters of

the san francisco, it should be by other voters not unelected officials and secondly i would put bawsca on the hook for this so that san francisco lay pair doesn't have to pay for that and lastly, i would say put it to a vote. all of california are key stakeholders in that issue and i urge you that they be given an opportunity to way in on this issue. >> thank you mr. martial. mr. rose crans? welcome. thank you mr. president and commission rs thank you for the opportunity to speak here today. mike is going to run out of time and i just want to emphasize that we told bawsca twice last summer orally that we would work with them to make sure that they would have this -- in the future of their water

system we don't think this is the way to do it and takingsing the power away from the volters of san francisco and we believable the stakes holders in san francisco have a stake in the future of yosemite and so, that is we are urging you not to take not to adopt this resolution but to put it off and negotiate it a better resolution and one more issue here, the noter whereas, extraordinarily deceptive it's not the right anybody outside the bay area looks at the water system. not the way professors at uc davis or the staff at department of water resources or department of interior looks at it they don't think that hetch hetchy is the

source of 75% of the water the -- river is the source of 75% and the question is if hetch hetchy valley is restored how much water will we still be able to bring to the bay area research showed almost all televise and it should be replace and had we urge you in this communication and future communication to be more truthful and correct about that issue. >> mr. jensen? i would like to have your inputs and since your organization is with the resolutions with the. >> thank you mr. president and members of the commission. first of all, a error fact is that the item before you would put any future vote in the hands of the governing bodies of the wholesale customers not bawsca and our agencies are

appointedded by those agencies and so all of officials would be casting a vote on the future supply of the water agreement are elected officials. >> what is the fact? this is an amendment water supply agreement that you have to wholesale customer and is it would go to do those wholesale customer and is to you in the future for further amendments because of what is written in the contract. beyond that, i would be glad to answer any questions but i thought it was important to correct those two statements. >> all right any questions by members of the he commission. air force question about this litigation point is that addressed? what will happen if litigation came forward who would --. >> members this would be tied to a -- issue but our costs cornetted with the water contract supply are shared with wholesale customers ethey pay two thirds and we pay one third

and any litigation without an amendment to the contract assuming someone had any stand to go bring that lawsuit would be part of the costs of the system and therefore shared in that way. >> thank you. commissioner did you have --? along the same lines with respect to the issues before us because there are two points that i consider important the first one was to be accurate and if we are notby holding to the 85% figure, perhaps, we will be more appropriate to refer to it as the primary source of the water just to acknowledge that it's important to be as accurate as we can. and then, finally with respect to the action before us, in your opinion, does approvalling an amendment like this in any way trigger the

potential for liability given what we have before us? the i don't think that the decision by the commission or the wholesale customers to amend the contract creates a risk of liability with respect to the alcohol i think it's within your authority do that and i think there may be some ambiguity or misunderstanding on the part of the speaker and is an amendment to the contract in no way limits the right of the slotters or effects the people's constitutional right to amend the charter or to vote. so, no, we would not expect that you are liable and under litigation with respect to the amendment to the contract..

>> all right. commissioner moran. with respect to the issue raised by mr. rows crans to the fourth whereas, this goes to a rhetorical point of is really smoke. all water comes from the actual 93 river [spelling?] however in the river it's of no use to us at all. that water to be useful as a water supply has to be controlled and the release of that water has to be metered and by metered it has to be controlled so it's available when and where we need it and so a river without a dam is not a water supply but a river with a dam is a water supply and that is the reason it's worded this way and if they don't like the wording because it shines a brighter light on the reservoir and on the dam that they would

like it's accurate from an engineering standpoint it's much more accurate than the wording that they are suggesting and so i'm comfortable with the language as is and's i also don't believe that this creates liability for us, i think it recognized something that the hetch hetchy focus have recognized and that is that by the nature of our system there are interested not fully rep.ped by the electives of city of prangs and that is why we have a contract with them and those term of the contract are important and define the responsibility. and terms the last campaign spotlights an area where that contract was deficient and, create the possibility of the circumstances that would not be handled properly by the contract. i think this amendment fixes that problem, and it fix it is in at

that way thats underrure control and into is we believe acceptable to bawsca we will find out as they vote on it, and i think it's dealing with the real problem in a correct way and so i support the amendment. all right is there a motion? >> i'll move it. i think we moved it already i think it's on the table. >> which table? we moved it and seconded it. >> we are finished with the public comment? >> yeah, our wholesale customers are our customers we have entered into an agreement with them and i think it's our right by mutual consent to add or subtract whatever we want. i don't think it's of the public opinion of that we cannot do what we want with our customers. very important as evidence by

your remark on the election and that was amended by the people.. >> all right all those in favor signify by saying aye, oppose? all right motion carry gorks item between accept >> instructor: we don't neat need elaboration. i hate elaboration. so we are open now? there

was no action taken during closed section is there any action to discuss the tups discussed during closed section. >> most not toculosis. to disclose. okay the motion carries the hour of 23 having arrived ... we are ready for our cleanpowersf. who's presenting? here we go. item 14 members. >> barbara hale assistant general manage for power thank

you members for did he go 98ing this time for local power i think and they are here to present to you their business case and financial deliverless at this point and their principal will be making the presentation. we have ten minutes allot it had for this presentation. >> thank you plaintiffs perhaps miscommunication and we prepared a 30-minute powerpoint. >> i think the first 17 slides are more than enough information for us. >> this is samuel golding our project manager. >> we will have to skip through some of the slides in order to meet your time requirement. >> yes, my name is paul from local power incorporated, we have been working here in the

city since 197, i know, as i really, commissioner moran, you have upthe general manager when i started working here on c c a and the city is also involved in the proposition h bond authority in 2,000 one and the 2004 c c a ordinance followed by the c c a complement plan of 2,007 and the work that we are doing now four for which we are grateful is the culmination of that workers. very much consists with the original ordinance that called for the use of the proposition h bond authority voter mandate from 2001 to build out a local renewable resore source from wind power and other technologies as far as recommendation in his our reports to you, what we are recommending to you is essentially a modification of

the curt program not any kind of a profound change would evolve from that program primary lie the hetch hetchy power in the motion denied destoe contract currently being sold on the market we are recommending an acceleration of local build out which we will get into in some detail and then we are recommending a change in strategies in terms of renewable credits and cost rex that you are currently using otherwise the changes that we are recommending do not change the program it would involve internal modification within the program in terms of agency in terms of how you allocate resource and planning budgeting and staffing. we have leek looking at 78 that you saw customer enrollment target and

the 20 megawatt target that is the lower ranges of the current range that you have currently and it involves 1800 watts of hetch hetchy problem and it would dilute the price premiums for phase one and set in place a program that is consistent with the build out goals of the program. as far as the more specific recommenddationings we are clear that the leading question box in the she'll agreement is in consistent with the bonds with the subsequent to phases that profession makes it difficult if not impossible to issue bonds in that agreement and so subsequent agreement should takes place without that leading question block in place and then under the proposed approach we would commence the build out immediately in 2015.

that is it. so surface the can you repeat clean hour s f program design that you have, from our point of view it's not competitive, it's seasonally very similar to the f g and e program which, is now pending approval in which you would essentially be under prized by that utility for your practical and have a significant risk of high opt-out rates. >> the proposed business case is essentially is a case of supply side model where you are buying power at a higher premium green power mix and none of the components are a alcohol for the industries that would involved it civilly would be a local scaled acceleration of affordable tax and co generation of energy efficiency and other local renewable demand site

resource as far as the conceptual approach and the product definition this is seasonally what was referred to in the industry as energy as a service and that means that you get out of the old kilowatt hour paradigm that goes back to the 1930's where you are selling hours of power into a service approach where you are standard dyeing on site affordable tax and building retrofits as standard components of that service we focus on a no money down approach to energy efficiency and renewables this would not only require any kind of a late premium to the customers but a rate discount for those customers and is so energy efficiency with a discount and no money down and that is product differentiation that p g and e does not offer

and utilities do not offer but we are uniquely poised to offer. this would apply to both the business community as well as residential customers. and so, as far as the approach to development we are really recommending an integrated and targeted approach to the resource rather than the market based additive approach which you have often see with conventional utility. the draft financial model that we preached was submitted a few months ago to the commission the power comprise is a baseline a proved concept at the mathematical willful which we are going to make more complex over the next few months the first model consistses of photowind and a regional wind

farm and as provide by the two house four ordinance and the final will demand response and solar thermal and power storage to give greater depth to the model but we are confidant that the surpluses which we will tell you about shortly will improve very likely in that final model. on that point. at what point are you making sure is there a model that you are going to weren't to us regarding the financial exposure to the rate pairs? payers. >> the he exposure to rate payers, i'm not sure exactly what you mean. you want to epitomize the exposure to rate payers where is the exposure. >> well that exactly -- if you want to tackle this, i'm not sure how to answer that. that mic is not working

iggs. >> the final risk parameters with wholesale power flakbations projected with the cost of power. >> is that available now. not available right now, no. it will be in about three months. in terms of how risk is treated within the model. >> colorado you want to talk model. >> do you want to talk about the financial build out. >> yeah the wholesale price of power fluctuates considerably in the last decade and in many situation that is has defined the marketplace in this case, we are proposing a substantial development of local renewable resource and those demands eliminate -- and so the very

approach limits risk compared to what you would get if you follow the shaw north america contract approach which, is all based on a commodity electricity which, is direct exposure to market price. and so at the high altitude, that is the most general statement that i can make about risk. this is a considerably low risk approach for the rate payer because of the performance of solar and efficiency and wind are very predictable, have no market price fluctuation, are simply a matter of whether the equipment works and so it's a comparison of equipment to fuel. may be the best response would be to give us some bullets down the road and so we know how to respond to that issue and because rate pairs are going to ask that we how are we minimizing the exposure to them. >> any other questions? yeah i have another question too in the risk --