This gradual expansion will allow CleanPowerSF to phase in operational and

This gradual expansion will allow cleanpowersf to

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customers. This gradual expansion will allow CleanPowerSF to phase in operational and resource procurement. It will also allow CleanPowerSF to make mid-course corrections if necessary in order to successfully reach full build-out. The following figure presents CleanPowerSF’s initial phasing plan for serving customers. Figure 5: Phasing Plan for Program Expansion Source: Pacific Energy Advisors Phasing Analysis December 4, 2015. From the above figure, it is seen that CleanPowerSF plans to have an initial rollout of 50 MW of load. CleanPowerSF plans to include approximately 75,000 customers in its initial
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customer group. These customers would consist of both residential and commercial customers. CleanPowerSF has determined that offering service to a mixture of residential and commercial customers will provide the program greater revenue stability (residential customers are less likely to switch providers) and higher operating margins (small and medium commercial customers have higher average rates and more sales per account) than if offering service to either commercial or residential customers alone. In the initial phase, CleanPowerSF will invite any customer within the City to participate by enrolling early. CleanPowerSF will fulfill the balance of its sales target by enrolling customers in the Southeast and Central parts of the City. 13 CleanPowerSF has set a stretch goal of enrolling sufficient customers into its SuperGreen program to fulfill 5% of CleanPowerSF annual sales (i.e., approximately 2.5 MW of the 50 MW), with the remaining 95% of its annual sales coming from customers receiving the default Green service. CleanPowerSF will have sufficient flexibility in its supply portfolio to handle different opt-out levels and customers’ product choices. For the base case, CleanPowerSF conservatively assumes that 20 percent of the initial tranche of customers will opt-out and continue to take commodity service from PG&E. This is a very conservative estimate and is a higher opt-out rate than Sonoma or Lancaster experienced during their start-ups, but consistent with the average opt-out rate MCE has experienced. The CleanPowerSF phasing plan after the initial tranche assumes a 15% opt-out rate to inform how fast the build-out may occur. After the first year, CleanPowerSF plans to have more phases and eventually expand to serve the entire city, as shown in Figure 5. This phasing plan assumes that CleanPowerSF meets all of its milestones and internal metrics that are established prior to the roll-out of each phase. These include that CleanPowerSF has:
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The ability to offer rates to customers sufficient to cover program costs and are competitive with PG&E’s generation rate less PCIA and franchise fee surcharges; 3 Supply commitments that are sufficient to meet projected load resulting from existing customers plus new customer enrollment; Staff and systems and/or qualified third parties that can handle additional volumes and accounts; Sufficient and cost-effective sources of credit/collateral and working capital
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