WEBVTT 00:00:00.000 --> 00:00:22.920 Unknown: take care guys.. 00:05:30.000 --> 00:05:32.000 Unknown: Thank you. 00:06:00.000 --> 00:06:02.000 Unknown: We are back to the public. 00:06:02.000 --> 00:06:04.000 Unknown: So I will try to get back to the public. 00:06:04.000 --> 00:06:06.000 Unknown: Thank you. 00:06:06.000 --> 00:06:08.000 Unknown: You're welcome. 00:06:08.000 --> 00:06:10.000 Unknown: Thank you. 00:06:10.000 --> 00:06:12.000 Unknown: Thank you. 00:06:12.000 --> 00:06:14.000 SPEAKER_04: Thank you. 00:06:14.000 --> 00:06:16.000 SPEAKER_04: Thank you. 00:06:16.000 --> 00:06:18.000 SPEAKER_04: Thank you. 00:06:18.000 --> 00:06:20.000 SPEAKER_04: Thank you. 00:06:20.000 --> 00:06:22.000 SPEAKER_04: Thank you. 00:06:22.000 --> 00:06:24.000 Unknown: Thank you. 00:06:24.000 --> 00:06:26.000 SPEAKER_04: Thank you and thank you for your support. 00:06:26.000 --> 00:06:28.000 SPEAKER_04: Thank you. 00:06:28.000 --> 00:06:33.060 SPEAKER_04: speakers request form located on the table outside this room and handed to security. 00:06:33.060 --> 00:06:37.500 SPEAKER_04: Members of the public attending this meeting virtually that wish to provide verbal comments 00:06:37.500 --> 00:06:42.660 SPEAKER_04: during committee may do so by using the raise hand feature in Zoom. 00:06:42.660 --> 00:06:45.100 SPEAKER_04: At the time, public comment is called. 00:06:45.100 --> 00:06:48.639 SPEAKER_04: Technical support staff will enable the audio for you when your name is announced during 00:06:48.639 --> 00:06:50.720 SPEAKER_04: the public comment period. 00:06:50.720 --> 00:06:55.240 SPEAKER_04: You may also submit written comments by emailing newpubliccomment.org. 00:06:55.240 --> 00:06:59.139 SPEAKER_04: Written comments will not be read into the record but will be provided to the board 00:06:59.139 --> 00:07:03.800 SPEAKER_04: electronically and placed into the record of the meeting if received within two hours 00:07:03.800 --> 00:07:05.740 SPEAKER_04: after the meeting ends. 00:07:05.740 --> 00:07:08.040 SPEAKER_04: Chief legal officer, please conduct the roll call. 00:07:08.040 --> 00:07:09.040 Unknown: Director Sanborn? 00:07:09.040 --> 00:07:10.040 Unknown: Director Bishman? 00:07:10.040 --> 00:07:11.040 SPEAKER_02: Here. 00:07:11.040 --> 00:07:12.040 SPEAKER_04: Chair Buettomson? 00:07:12.040 --> 00:07:13.040 SPEAKER_02: Present. 00:07:13.040 --> 00:07:16.040 SPEAKER_02: Director Bishman and Chair Buettomson are present. 00:07:16.040 --> 00:07:18.040 SPEAKER_02: Director Sanborn is absent. 00:07:18.040 --> 00:07:22.740 SPEAKER_02: Also present are directors Rose, Herver and present tonight. 00:07:22.740 --> 00:07:23.740 SPEAKER_04: Thank you. 00:07:23.740 --> 00:07:27.620 SPEAKER_04: And tonight's agenda is to provide the board an update on the status of customer programs 00:07:27.620 --> 00:07:30.819 SPEAKER_04: under the 2030 zero carbon plan. 00:07:30.819 --> 00:07:36.460 SPEAKER_04: Our presenter, Rach Wong, the director of distributed energy solutions will be presenting 00:07:36.460 --> 00:07:38.780 SPEAKER_04: this evening. 00:07:38.780 --> 00:07:43.819 Unknown: Thank you. 00:07:43.819 --> 00:07:44.819 SPEAKER_01: Distributed energy solutions. 00:07:44.819 --> 00:07:48.660 SPEAKER_01: Tonight I'm going to be giving you an update on SMUD's customer programs and initiatives 00:07:48.660 --> 00:07:50.900 SPEAKER_01: relative to the zero carbon plan. 00:07:51.159 --> 00:07:56.579 SPEAKER_01: Before I dive in, I really do want to take some time to acknowledge the efforts of all 00:07:56.579 --> 00:08:02.259 SPEAKER_01: the staff that really help contribute towards delivering our zero carbon plan customer programs. 00:08:02.259 --> 00:08:05.299 SPEAKER_01: The distributed energy solutions team definitely leads the work. 00:08:05.299 --> 00:08:10.699 SPEAKER_01: But the work that we do actually touches probably almost every single organization within SMUD. 00:08:10.699 --> 00:08:13.579 SPEAKER_01: So it would be impossible to thank everybody by name. 00:08:13.579 --> 00:08:18.060 SPEAKER_01: But I just wanted to acknowledge all that help support offering these customers for 00:08:18.060 --> 00:08:22.019 SPEAKER_01: our program as well as the leadership of the distributed energy solutions team to be 00:08:22.019 --> 00:08:23.259 SPEAKER_01: able to deliver them. 00:08:23.259 --> 00:08:24.459 SPEAKER_01: Thank you. 00:08:24.459 --> 00:08:26.500 SPEAKER_01: Next slide. 00:08:26.500 --> 00:08:28.240 SPEAKER_01: Next slide. 00:08:28.240 --> 00:08:31.060 SPEAKER_01: So the board is all familiar with this slide. 00:08:31.060 --> 00:08:35.940 SPEAKER_01: It's just a reminder of what SMUD's customer programs and how they play a role in multiple 00:08:35.940 --> 00:08:39.019 SPEAKER_01: aspects of our zero carbon plan. 00:08:39.019 --> 00:08:43.600 SPEAKER_01: We expand clean technology through the renewable offerings of our green pricing offerings. 00:08:43.600 --> 00:08:48.720 SPEAKER_01: We pilot and scale new technology and business models with our virtual power plant offerings. 00:08:48.720 --> 00:08:53.159 SPEAKER_01: We are pursuing grants and partnerships to get external funding and support to stack 00:08:53.159 --> 00:08:57.480 SPEAKER_01: those financial offerings with our program offerings to keep rates affordable for our 00:08:57.480 --> 00:08:59.519 SPEAKER_01: customers and our community. 00:08:59.519 --> 00:09:03.279 SPEAKER_01: And we maximize those customer and community benefits to ensure that all of our customers 00:09:03.279 --> 00:09:08.000 SPEAKER_01: have an opportunity to participate in the zero carbon plan vision. 00:09:08.000 --> 00:09:11.560 SPEAKER_01: In addition to our own emissions, our building and transportation electrification programs 00:09:11.559 --> 00:09:16.759 SPEAKER_01: help support local decarbonization and improve air quality as Dr. Ayala talked about last 00:09:16.759 --> 00:09:18.959 SPEAKER_01: week in his presentation. 00:09:18.959 --> 00:09:21.359 SPEAKER_01: Next slide. 00:09:21.359 --> 00:09:25.699 SPEAKER_01: So as I've mentioned in previous board updates for the customer programs for the zero carbon 00:09:25.699 --> 00:09:30.519 SPEAKER_01: plan, our customer zero carbon plan programs are generally grouped into these four portfolios 00:09:30.519 --> 00:09:32.000 SPEAKER_01: that you see here below. 00:09:32.000 --> 00:09:35.959 SPEAKER_01: I'll describe each portfolio in more detail on the slides that follow, but I do want to 00:09:35.959 --> 00:09:37.919 SPEAKER_01: give some additional context. 00:09:37.919 --> 00:09:42.559 SPEAKER_01: So the first is that while the programs and projects in each portfolio are included based 00:09:42.559 --> 00:09:47.319 SPEAKER_01: upon their primary goals and objectives, we do strive to offer solutions that can work 00:09:47.319 --> 00:09:50.479 SPEAKER_01: across multiple portfolios when working with customers. 00:09:50.479 --> 00:09:54.079 SPEAKER_01: Because as you think about it, customers often adopt multiple technologies. 00:09:54.079 --> 00:09:57.759 SPEAKER_01: And so we do have projects that tap into different programs and different portfolios, and we 00:09:57.759 --> 00:10:01.479 SPEAKER_01: really shape that to best meet our customers' needs. 00:10:01.479 --> 00:10:04.240 SPEAKER_01: There's also a theme that you're going to hear from me tonight, and maybe I'll start 00:10:04.240 --> 00:10:09.560 SPEAKER_01: getting repetitive, but as I share our progress for each of the portfolios, the reality is 00:10:09.560 --> 00:10:13.120 SPEAKER_01: is that we are facing a lot of external headwinds. 00:10:13.120 --> 00:10:17.039 SPEAKER_01: We've been taking measures to support that participation, but we're also ensuring that 00:10:17.039 --> 00:10:21.080 SPEAKER_01: we're managing the incentives to the value that SMUD gets in investing in these different 00:10:21.080 --> 00:10:25.639 SPEAKER_01: technologies and customer adoption to ensure that we maintain affordability and low rates 00:10:25.639 --> 00:10:28.340 SPEAKER_01: for all of our SMUD customers. 00:10:28.340 --> 00:10:32.060 SPEAKER_01: As such, as you know from some of the different communications of the board, but as I'll also 00:10:32.059 --> 00:10:36.899 SPEAKER_01: be talking about, while we have increased incentives in certain areas, we haven't been 00:10:36.899 --> 00:10:41.659 SPEAKER_01: able to come close to making up the difference in what we've lost in external funding sources 00:10:41.659 --> 00:10:44.419 Unknown: that we can stack on top of SMUD's incentives. 00:10:44.419 --> 00:10:48.619 SPEAKER_01: And we've also been working on evolving SMUD's program designs to best align where there's 00:10:48.619 --> 00:10:53.699 SPEAKER_01: value that we can share between SMUD and our customers so that we can pass that value onto 00:10:53.699 --> 00:10:57.699 SPEAKER_01: our customers in helping them manage their energy bills. 00:10:57.699 --> 00:11:00.199 SPEAKER_01: Next slide. 00:11:00.220 --> 00:11:03.180 SPEAKER_01: So first, building electrification and energy efficiency. 00:11:03.180 --> 00:11:05.940 SPEAKER_01: You've heard me say this many times before. 00:11:05.940 --> 00:11:11.980 SPEAKER_01: The lowest hanging fruit for greenhouse gas emissions reduction are transportations and 00:11:11.980 --> 00:11:12.980 SPEAKER_01: buildings. 00:11:12.980 --> 00:11:15.120 SPEAKER_01: Buildings are actually the second largest source. 00:11:15.120 --> 00:11:19.540 SPEAKER_01: As such, as we decarbonize our energy supply, we not only support the decarbonization of 00:11:19.540 --> 00:11:23.140 SPEAKER_01: buildings, but we actually eliminate direct combustion of fossil fuels. 00:11:23.140 --> 00:11:26.180 SPEAKER_01: We improve efficiency through the electric equipment. 00:11:26.199 --> 00:11:30.819 SPEAKER_01: And because our electricity rates are much lower compared to PG&E's gas rates and their 00:11:30.819 --> 00:11:35.539 SPEAKER_01: expected growth and their expected rate trajectory growth, building electrification is also the 00:11:35.539 --> 00:11:38.479 SPEAKER_01: best way for our customers to save on their total energy expenditures. 00:11:38.479 --> 00:11:42.379 SPEAKER_01: And I'll go into more detail at the end of my presentation. 00:11:42.379 --> 00:11:47.519 SPEAKER_01: So as we shift our customers to efficient electric appliances, we actually are complementing 00:11:47.519 --> 00:11:52.559 SPEAKER_01: our supply-side renewable energy commitments and help our customers achieve carbon savings, 00:11:52.699 --> 00:11:57.559 SPEAKER_01: both by increasing their use of cleaner power from our energy portfolio, but also in reducing 00:11:57.559 --> 00:12:01.219 SPEAKER_01: the use of fossil fuels within their homes and their transportation. 00:12:03.219 --> 00:12:04.219 SPEAKER_01: Okay. 00:12:04.219 --> 00:12:05.779 SPEAKER_01: Next slide. 00:12:05.779 --> 00:12:12.219 SPEAKER_01: So this shows the progress of our achievement of our building electrification goals. 00:12:12.219 --> 00:12:18.679 SPEAKER_01: On the left-hand side is our annual goals on a month-by-month basis for 2026. 00:12:18.699 --> 00:12:23.639 SPEAKER_01: And on the right, you see the trajectory that was developed by the zero carbon plan and 00:12:23.639 --> 00:12:26.539 SPEAKER_01: how we're doing on an annual basis. 00:12:26.539 --> 00:12:32.339 SPEAKER_01: And then I'll also start by reminding all of you how we calculate this metric of all 00:12:32.339 --> 00:12:33.919 SPEAKER_01: electric equivalent homes. 00:12:33.919 --> 00:12:37.899 SPEAKER_01: It doesn't mean that every single home has to be electrified to count. 00:12:37.899 --> 00:12:42.500 SPEAKER_01: What it considers is the impact of electrifying individual devices, so heat pump water heaters, 00:12:42.500 --> 00:12:47.539 SPEAKER_01: heat pump space heaters, for example, and the aggregated impact at the community level. 00:12:47.539 --> 00:12:52.219 SPEAKER_01: This metric is the combination of commercial and residential accounts, so we translate 00:12:52.219 --> 00:13:00.019 SPEAKER_01: these measures into the equivalent using 3,300 kilowatt hours as an equivalent home. 00:13:00.019 --> 00:13:07.059 SPEAKER_01: So for our 2030 goals, we're striving to add 112,000 equivalent all-electric homes by 2030. 00:13:07.059 --> 00:13:11.439 SPEAKER_01: That gives us that total of 154,000 because we started with a baseline of all-electric 00:13:11.439 --> 00:13:15.000 SPEAKER_01: homes when we started our journey in our service territory. 00:13:15.000 --> 00:13:21.720 SPEAKER_01: And also note that a commercial building could be as many as multiple equivalent all-electric 00:13:21.720 --> 00:13:27.519 SPEAKER_01: homes because of the magnitude of the measures. 00:13:27.519 --> 00:13:31.840 SPEAKER_01: So last year, I did give a little bit of foreshadowing, and I shared that while we didn't meet our 00:13:31.840 --> 00:13:39.399 SPEAKER_01: 2025 annual goals, we still met, in most cases across our portfolio, our ZCP trajectory in 00:13:39.399 --> 00:13:42.639 SPEAKER_01: that specific year, which is the graph on the right. 00:13:42.659 --> 00:13:48.000 SPEAKER_01: I also foreshadowed that this year would be quite challenging in order to hit our goals, 00:13:48.000 --> 00:13:54.279 SPEAKER_01: even though we were ahead of our ZCP trajectory goals given the curve, right? 00:13:54.279 --> 00:13:58.199 SPEAKER_01: So we were kind of starting out slow, and then we were starting to be on the curve that's 00:13:58.199 --> 00:13:59.399 SPEAKER_01: curving up. 00:13:59.399 --> 00:14:02.919 SPEAKER_01: And unfortunately, while the team has worked very diligently to try to get as close to 00:14:02.919 --> 00:14:08.639 SPEAKER_01: the goals as possible, we are expected to meet our annual goal as well as our 2026 ZCP 00:14:08.639 --> 00:14:10.580 SPEAKER_01: trajectory goal this year. 00:14:10.580 --> 00:14:13.980 SPEAKER_01: We are facing a lot of headwinds, and you'll hear me say this a lot. 00:14:13.980 --> 00:14:17.980 SPEAKER_01: The federal tax credit for energy efficiency and building electrification expired at the 00:14:17.980 --> 00:14:22.460 SPEAKER_01: end of the year, and statewide funding that actually got some flow down in funding from 00:14:22.460 --> 00:14:24.460 SPEAKER_01: the federal government was cut. 00:14:24.460 --> 00:14:28.700 SPEAKER_01: And then we're also facing a pretty volatile economy, and so customers are holding back 00:14:28.700 --> 00:14:32.980 SPEAKER_01: on making large financial investments if that's not really critical. 00:14:32.980 --> 00:14:37.220 SPEAKER_01: So recognizing these headwinds, we will be undertaking goal updates in conjunction with 00:14:37.220 --> 00:14:41.060 SPEAKER_01: the development of the integrated resources plan, which we'll be starting shortly. 00:14:41.060 --> 00:14:46.500 SPEAKER_01: And we've been modeling scenarios and evaluating BE and EE targets, doing that analysis through 00:14:46.500 --> 00:14:47.500 SPEAKER_01: 2027. 00:14:47.500 --> 00:14:52.019 SPEAKER_01: And what we will be doing is coming back to the board as part of the SD9 update following 00:14:52.019 --> 00:14:58.820 SPEAKER_01: the IRP for a recommendation to the board on revisions to SD9. 00:14:58.820 --> 00:15:01.340 SPEAKER_01: Next slide. 00:15:01.340 --> 00:15:05.540 SPEAKER_01: So despite the outlook of coming in short of our goals overall for the portfolio, there 00:15:05.539 --> 00:15:08.379 SPEAKER_01: are still some bright spots to highlight. 00:15:08.379 --> 00:15:12.899 SPEAKER_01: So our Advanced Home Solutions Program, which is our residential retrofit program, is forecasted 00:15:12.899 --> 00:15:18.139 SPEAKER_01: to exceed 30,000 cumulative heat pump installations by third quarter of this year. 00:15:18.139 --> 00:15:25.899 SPEAKER_01: This includes more than 22,500 heat pump space heaters and over 7,500 heat pump water heaters 00:15:25.899 --> 00:15:30.099 SPEAKER_01: that have been installed since our program inception in 2018. 00:15:30.099 --> 00:15:33.879 SPEAKER_01: You'll see that we're actually forecasting to exceed our heat pump water heater goals 00:15:33.879 --> 00:15:41.799 SPEAKER_01: for the year, as well as meet our income-qualified home electrification retrofits. 00:15:41.799 --> 00:15:46.639 SPEAKER_01: You do know also that we did increase our incentives across the board for both residential 00:15:46.639 --> 00:15:51.480 SPEAKER_01: and commercial programs this year to help support adoption, especially as we heard about 00:15:51.480 --> 00:15:53.980 SPEAKER_01: the pullback in federal funding. 00:15:53.980 --> 00:15:58.679 SPEAKER_01: We had decreased the incentives actually starting last year in recognition that we could stack 00:15:58.679 --> 00:16:01.679 SPEAKER_01: incentives but with the pullback in federal funding. 00:16:01.679 --> 00:16:06.959 SPEAKER_01: We chose to increase incentives at the beginning of this year for residential and have added 00:16:06.959 --> 00:16:10.079 SPEAKER_01: some additional increases throughout the year. 00:16:10.079 --> 00:16:11.819 SPEAKER_01: We had lost federal funding. 00:16:11.819 --> 00:16:16.139 SPEAKER_01: We had pauses in statewide funding, including tech funding that was significant in the thousands 00:16:16.139 --> 00:16:17.139 SPEAKER_01: of dollars. 00:16:17.139 --> 00:16:21.959 SPEAKER_01: And even though we increased incentives by $500 for most of our programs, there was no 00:16:21.959 --> 00:16:26.199 SPEAKER_01: way financially that we could make that gap that we lost from the external sources of 00:16:26.200 --> 00:16:27.720 SPEAKER_01: fundings that we could stack. 00:16:27.720 --> 00:16:33.240 SPEAKER_01: So, well, our most recent incentive increased with both increasing incentives as well as 00:16:33.240 --> 00:16:36.680 SPEAKER_01: increasing the cap for our multifamily building electrification. 00:16:36.680 --> 00:16:41.920 SPEAKER_01: So recognizing that as we think of multifamily was a key sector that we want to help electrify, 00:16:41.920 --> 00:16:44.820 SPEAKER_01: making sure that that's aligned as well. 00:16:44.820 --> 00:16:49.259 SPEAKER_01: And while losing external funding sources has been a challenge, we are actually still 00:16:49.259 --> 00:16:55.020 SPEAKER_01: seeing year-over-year increases in project volume, even if they're not to the extent 00:16:55.019 --> 00:16:56.939 SPEAKER_01: that we planned. 00:16:56.939 --> 00:17:01.039 SPEAKER_01: So in addition to incentives, we have continued to develop and offer tools to support our 00:17:01.039 --> 00:17:04.180 SPEAKER_01: customers and help them make the decision to electrify. 00:17:04.180 --> 00:17:08.740 SPEAKER_01: At the end of last year, after the board presentation, we launched the Zero Home tool. 00:17:08.740 --> 00:17:12.500 SPEAKER_01: It's a free online tool that provides our residential customers the ability to model 00:17:12.500 --> 00:17:17.119 SPEAKER_01: their homes' current energy use and identify potential cost savings from electrification 00:17:17.119 --> 00:17:19.139 SPEAKER_01: and energy efficiency upgrades. 00:17:19.139 --> 00:17:22.660 SPEAKER_01: Customers can view their homes' current carbon footprint and energy usage. 00:17:22.660 --> 00:17:23.980 SPEAKER_01: They actually don't have to authenticate. 00:17:23.980 --> 00:17:26.099 SPEAKER_01: They just plug in their home address. 00:17:26.099 --> 00:17:29.579 SPEAKER_01: They can choose from a menu of electrification upgrades to see the rebates and incentives 00:17:29.579 --> 00:17:34.420 SPEAKER_01: available to estimate their out-of-pocket costs, as well as their future energy bill 00:17:34.420 --> 00:17:35.420 SPEAKER_01: savings. 00:17:35.420 --> 00:17:39.759 SPEAKER_01: We're also working on developing an enhanced contractor tool with the Zero Home to be able 00:17:39.759 --> 00:17:43.539 SPEAKER_01: to make it easy for customers that as they see this analysis, if they want to take action 00:17:43.539 --> 00:17:47.779 SPEAKER_01: to be able to access information about contractors that can help them take those actions, as 00:17:47.779 --> 00:17:51.519 SPEAKER_01: well as we're talking to Zero Home about a version of the customer tool that they've 00:17:51.519 --> 00:17:55.680 SPEAKER_01: designed for tenants and property owners of multifamily buildings. 00:17:55.680 --> 00:18:00.839 Unknown: Dr. Webster and our reporter spoke to you about SMUD's Community Impact Plan and the 00:18:00.839 --> 00:18:02.240 SPEAKER_01: income-qualified efforts in August. 00:18:02.240 --> 00:18:03.879 SPEAKER_01: So I'm not going to reiterate those. 00:18:03.879 --> 00:18:08.559 SPEAKER_01: But I did want to highlight the Garden Land Northgate Neighborhood Association, which 00:18:08.559 --> 00:18:11.000 SPEAKER_01: you often hear is GNNA, effort. 00:18:11.000 --> 00:18:15.079 SPEAKER_01: And they've successfully completed 16 projects and have 16 projects in flight. 00:18:15.079 --> 00:18:19.559 SPEAKER_01: We've gotten part of the federal ARPA grant reimbursement for the Community Impact Plan 00:18:19.559 --> 00:18:22.919 SPEAKER_01: efforts and expect to receive full reimbursement. 00:18:22.919 --> 00:18:28.960 SPEAKER_01: So back to the piece about grant funding and additional funding to support our efforts. 00:18:28.960 --> 00:18:33.960 SPEAKER_01: We've also updated our definition as of July of what we consider an active contractor within 00:18:33.960 --> 00:18:38.279 SPEAKER_01: our contractor network to be one that completed three measures of that type within the last 00:18:38.279 --> 00:18:39.519 SPEAKER_01: 90 days. 00:18:39.519 --> 00:18:44.159 SPEAKER_01: This ensures that customers that are searching for contractors to do a certain measure, that 00:18:44.159 --> 00:18:48.079 SPEAKER_01: they are getting contractors recommended to them that have completed the relevant work 00:18:48.079 --> 00:18:53.960 SPEAKER_01: recently, as well as it helps encourage contractors to do jobs in the measures that we're incentivizing 00:18:53.960 --> 00:18:55.799 SPEAKER_01: and promoting. 00:18:55.799 --> 00:19:00.019 SPEAKER_01: Looking ahead, to both help our customers mitigate grid impacts, as well as helping 00:19:00.019 --> 00:19:03.859 SPEAKER_01: support our customers who need to replace things like Zinsco panels, we are working 00:19:03.859 --> 00:19:07.039 SPEAKER_01: on incentives for residential smart panels and meter-collar devices. 00:19:07.039 --> 00:19:12.319 SPEAKER_01: Our R&D team is working on pilots to both income customers as well as market rate customers 00:19:12.319 --> 00:19:16.599 SPEAKER_01: to validate savings estimates, as well as benefits from advanced load management to 00:19:16.599 --> 00:19:19.679 SPEAKER_01: help support those incentive levels. 00:19:19.679 --> 00:19:24.519 SPEAKER_01: We're working to address that classic challenge with regards to water heater replacements 00:19:24.519 --> 00:19:29.619 SPEAKER_01: in emergencies by developing an emergency heat pump water heater replacement offering 00:19:29.619 --> 00:19:32.199 SPEAKER_01: that we hope to launch early next year. 00:19:32.199 --> 00:19:36.919 SPEAKER_01: I know the board's been very interested in the status of the RFP and the solicitation 00:19:36.919 --> 00:19:39.519 SPEAKER_01: for a new vendor for our complete energy solutions. 00:19:39.519 --> 00:19:40.759 SPEAKER_01: We launched that in the summer. 00:19:40.759 --> 00:19:45.960 SPEAKER_01: The team is actually currently evaluating the bids and is preparing for demos by the 00:19:45.960 --> 00:19:49.319 SPEAKER_01: bidders, I think, in the next couple weeks. 00:19:49.319 --> 00:19:53.000 SPEAKER_01: We expect to bring that contract to the board early next year. 00:19:53.000 --> 00:19:57.879 SPEAKER_01: And then finally, we've been closely tracking the CPUC's efforts and communicating with 00:19:57.879 --> 00:20:04.039 SPEAKER_01: staff at PG&E for consideration of opportunities under SB 1221 projects. 00:20:04.039 --> 00:20:10.399 SPEAKER_01: So that's the legislation that where if more if it's more cost effective to electrify 00:20:10.399 --> 00:20:15.839 SPEAKER_01: than upgrade aging infrastructure, allocating funds to help support building electrification 00:20:15.839 --> 00:20:17.440 SPEAKER_01: instead. 00:20:17.440 --> 00:20:23.559 SPEAKER_01: And so the latest information from the CPUC in July helped narrow down that actually some 00:20:23.559 --> 00:20:28.159 SPEAKER_01: of these pockets of locations are with customers in that 6 to 20 range. 00:20:28.159 --> 00:20:33.700 SPEAKER_01: So the requirement of needing at least two-thirds of the customers to be aligned to do the work 00:20:33.860 --> 00:20:37.019 SPEAKER_01: is a little bit mitigated in terms of risk because the numbers of customers that we're 00:20:37.019 --> 00:20:38.180 SPEAKER_01: talking on are much smaller. 00:20:38.180 --> 00:20:40.100 SPEAKER_01: It's not a huge base. 00:20:40.100 --> 00:20:44.460 SPEAKER_01: And looking at some of the different target areas for that. 00:20:44.460 --> 00:20:45.460 SPEAKER_01: Next slide, please. 00:20:45.460 --> 00:20:46.460 Unknown: Yes. 00:20:46.460 --> 00:20:47.460 SPEAKER_01: All right. 00:20:47.460 --> 00:20:48.460 SPEAKER_05: Oh, go ahead. 00:20:48.460 --> 00:20:49.460 SPEAKER_05: I thought briefly earlier. 00:20:49.460 --> 00:20:53.340 SPEAKER_05: Maybe I won't say anything, but that's not going to happen. 00:20:53.340 --> 00:20:54.340 SPEAKER_01: What's not going to happen? 00:20:54.340 --> 00:20:55.340 SPEAKER_01: SB 1221, is that going to happen? 00:20:55.340 --> 00:20:56.340 SPEAKER_01: Can I tell you that? 00:20:56.340 --> 00:21:01.340 SPEAKER_01: I'm going to ask a couple of questions though. 00:21:01.980 --> 00:21:10.139 SPEAKER_05: I guess the first one, it was related to the state and federal like HVAC and water heater 00:21:10.139 --> 00:21:15.740 SPEAKER_05: and conversion to electrification, both tax credits and grants. 00:21:15.740 --> 00:21:20.339 SPEAKER_05: I know the one big beautiful bill killed a whole slew of that funding. 00:21:20.339 --> 00:21:27.740 SPEAKER_05: Is there anything currently like opened or approved at either the state or federal level? 00:21:27.740 --> 00:21:30.819 SPEAKER_05: The tech funding has been coming in and out. 00:21:30.819 --> 00:21:37.139 SPEAKER_01: And so that's been feedback back to the state relative to both for customers and for contractors 00:21:37.139 --> 00:21:40.579 SPEAKER_01: to have some more predictability instead of this like tech funding is available and then 00:21:40.579 --> 00:21:41.579 SPEAKER_01: tech funding is not available. 00:21:41.579 --> 00:21:43.579 SPEAKER_01: You would have to run those programs. 00:21:43.579 --> 00:21:46.659 SPEAKER_05: But the state's notorious, I mean I run a program for the state. 00:21:46.659 --> 00:21:49.819 SPEAKER_05: It's notorious for coming and going as things fill up. 00:21:49.819 --> 00:21:50.819 SPEAKER_01: Yeah. 00:21:50.819 --> 00:21:56.139 SPEAKER_01: So that's been one that theoretically can still be available as more funding is available. 00:21:56.139 --> 00:21:59.939 SPEAKER_01: But the main ones, and I think I had done a presentation to the board last year with 00:21:59.940 --> 00:22:04.100 SPEAKER_01: regards to our potential study and an update on building electrification. 00:22:04.100 --> 00:22:09.580 SPEAKER_01: And you may recall that, like I said, even though we are bumping up incentives by $500 00:22:09.580 --> 00:22:14.180 SPEAKER_01: or even $1,000 in certain areas or lifting caps, we're losing thousands of dollars through 00:22:14.180 --> 00:22:15.180 SPEAKER_01: that external funding. 00:22:15.180 --> 00:22:16.980 SPEAKER_01: So it's very challenging to make up. 00:22:16.980 --> 00:22:19.900 SPEAKER_01: Plus we're seeing increased costs, right, between tariffs and things like that. 00:22:19.900 --> 00:22:21.539 SPEAKER_01: We're seeing increased costs as well. 00:22:21.539 --> 00:22:22.539 SPEAKER_05: It's in my mind. 00:22:22.539 --> 00:22:26.660 SPEAKER_05: What does that, I guess what does that elasticity looks like as those dollars disappear and 00:22:26.660 --> 00:22:28.500 SPEAKER_05: the cost of the projects go up? 00:22:28.819 --> 00:22:34.059 SPEAKER_05: I guess how many are we losing because of the outside influences? 00:22:34.059 --> 00:22:35.779 SPEAKER_05: Like we bumped our incentive up. 00:22:35.779 --> 00:22:44.059 SPEAKER_05: We can't make up for a 30% federal tax credit or $3,000 from state funding. 00:22:44.059 --> 00:22:45.940 SPEAKER_01: I think there's a couple things to remember. 00:22:45.940 --> 00:22:52.019 SPEAKER_01: One is, and I'll get into this a little bit closer to the end of the presentation, but 00:22:52.019 --> 00:22:58.140 SPEAKER_01: Tech actually did some analysis and we tacked onto it with our EM&V team and actually identified 00:22:58.259 --> 00:23:03.700 SPEAKER_01: that in SMUD territory, I've given you estimates in the past of how much customers can save 00:23:03.700 --> 00:23:08.380 SPEAKER_01: by going to building electrification and actually that EM&V study reinforced that actually 00:23:08.380 --> 00:23:10.420 SPEAKER_01: customers can save even more than what we thought. 00:23:10.420 --> 00:23:16.820 SPEAKER_01: So we're still well positioned in terms of building electrification being a very wise 00:23:16.820 --> 00:23:21.100 SPEAKER_01: investment for our customers and probably one of the best ways to help our customers 00:23:21.100 --> 00:23:23.820 SPEAKER_01: save on their electricity bill. 00:23:23.819 --> 00:23:26.299 SPEAKER_01: It's just really that trajectory, right? 00:23:26.299 --> 00:23:30.779 SPEAKER_01: Like that really aggressive exponential growth trajectory is really what we need to really 00:23:30.779 --> 00:23:32.859 SPEAKER_01: consider and rethink. 00:23:32.859 --> 00:23:37.339 SPEAKER_01: And I think that's something, as I mentioned, as we look at revising SD9, I think that those 00:23:37.339 --> 00:23:41.539 SPEAKER_01: are conversations we need to have as part of our integrated resources planning process. 00:23:41.539 --> 00:23:45.779 SPEAKER_01: Not that the IRP analysis identifies what that should be, but I think that's part of 00:23:45.779 --> 00:23:50.139 SPEAKER_01: that stakeholder and board conversation about how we think about electrification and what 00:23:50.139 --> 00:23:51.139 SPEAKER_01: those goals are. 00:23:51.140 --> 00:23:54.700 SPEAKER_01: We're still well positioned and it is still beneficial to our customers. 00:23:54.700 --> 00:24:00.300 SPEAKER_01: I think the key is just not that exponential aggressive trajectory is really what we should 00:24:00.300 --> 00:24:01.300 SPEAKER_01: be looking at. 00:24:01.300 --> 00:24:02.300 Unknown: Okay. 00:24:02.300 --> 00:24:08.259 Unknown: Rachel, another question is really more about rates, so I don't think we can get an answer 00:24:08.259 --> 00:24:09.259 SPEAKER_06: or not. 00:24:09.259 --> 00:24:15.060 SPEAKER_06: We only give – so we give incentives to people who buy a new appliance, if it's 00:24:15.060 --> 00:24:20.620 SPEAKER_06: an electric appliance, but we only give a rate relief if their home is all electric, 00:24:21.339 --> 00:24:23.819 SPEAKER_01: when you say rate relief, what do you mean? 00:24:23.819 --> 00:24:25.699 SPEAKER_06: We offer an all-electric rate, right? 00:24:25.699 --> 00:24:26.699 SPEAKER_06: No. 00:24:26.699 --> 00:24:27.699 SPEAKER_06: Oh, well, okay. 00:24:27.699 --> 00:24:28.699 SPEAKER_06: We don't anymore. 00:24:28.699 --> 00:24:30.699 SPEAKER_06: I'm not sure when the whole controversy went down. 00:24:30.699 --> 00:24:31.699 SPEAKER_06: Okay. 00:24:31.699 --> 00:24:33.699 Unknown: Wait, Jennifer, do you want to chime in? 00:24:33.699 --> 00:24:34.699 SPEAKER_04: We used to. 00:24:34.699 --> 00:24:38.699 SPEAKER_04: We went against our ads, but oh, okay. 00:24:38.699 --> 00:24:42.139 SPEAKER_06: Well, then my mistake, I thought we did. 00:24:42.139 --> 00:24:44.059 SPEAKER_06: So my question is moot, never mind. 00:24:44.059 --> 00:24:47.059 Unknown: Yeah, no, we didn't. 00:24:47.059 --> 00:24:48.059 Unknown: Okay. 00:24:48.859 --> 00:24:49.859 Unknown: Yeah, we used to. 00:24:49.859 --> 00:24:50.859 SPEAKER_05: We used to. 00:24:50.859 --> 00:24:52.859 SPEAKER_05: I think it came off about 2017. 00:24:52.859 --> 00:24:58.179 SPEAKER_05: Rachel, the other thing on the previous slide you had – and you mentioned this, the smart 00:24:58.179 --> 00:24:59.179 SPEAKER_05: panel. 00:24:59.179 --> 00:25:00.179 SPEAKER_05: Yes. 00:25:00.179 --> 00:25:02.179 SPEAKER_05: The smart panel and meter coloring. 00:25:02.179 --> 00:25:07.419 SPEAKER_05: Can you maybe elaborate a little bit on the timing and development and what the current 00:25:07.419 --> 00:25:11.019 SPEAKER_05: thinking is we might have a product available? 00:25:11.019 --> 00:25:12.019 SPEAKER_01: Sure. 00:25:12.019 --> 00:25:17.059 SPEAKER_01: So we are working – the team has been working to move as quickly as possible to be able 00:25:17.059 --> 00:25:19.460 SPEAKER_01: to offer an incentive. 00:25:19.460 --> 00:25:24.099 SPEAKER_01: We've actually – in partnership with the R&D team, we actually had some consultant 00:25:24.099 --> 00:25:30.299 SPEAKER_01: analysis to look at what we thought the savings would be with regards to labor that could 00:25:30.299 --> 00:25:33.859 SPEAKER_01: help sort of justify what an incentive level would be. 00:25:33.859 --> 00:25:35.659 SPEAKER_01: We've drafted those incentive levels. 00:25:35.659 --> 00:25:41.759 SPEAKER_01: We've done conversations internally to vet that from a financial standpoint. 00:25:41.759 --> 00:25:48.039 SPEAKER_01: We have also been working to – one thing I will say is that we are planning on having 00:25:48.039 --> 00:25:54.799 SPEAKER_01: that incentive be vendor agnostic, recognizing that while there are leaders in the space, 00:25:54.799 --> 00:26:00.279 SPEAKER_01: there are other emerging entities in that space and so want to make sure that we have 00:26:00.279 --> 00:26:01.279 SPEAKER_01: that. 00:26:01.279 --> 00:26:05.480 SPEAKER_01: So we're developing the specs of what are the requirements to access that incentive 00:26:05.480 --> 00:26:11.599 SPEAKER_01: but aren't dictating that it's only one specific company or another. 00:26:12.599 --> 00:26:19.879 SPEAKER_01: We are, as part of that, looking to develop an incentive that's a like-for-like panel 00:26:19.879 --> 00:26:24.559 SPEAKER_01: replacement and recognition that some customers with Zinsco panels are looking to replace 00:26:24.559 --> 00:26:28.939 SPEAKER_01: their panel outside of requiring a building electrification measure. 00:26:28.939 --> 00:26:32.359 SPEAKER_01: So those are some of those things that we've been vetting through. 00:26:32.359 --> 00:26:37.639 SPEAKER_01: And then we're working closely with the vendors on what availability they have of equipment 00:26:37.680 --> 00:26:44.800 SPEAKER_01: and the delivery pathways to be able to offer that as options for our customers. 00:26:44.800 --> 00:26:50.440 SPEAKER_01: The other thing separately – Suresh is not here, but we're working on an IT project. 00:26:50.440 --> 00:26:51.960 SPEAKER_01: This is more information you need to know. 00:26:51.960 --> 00:26:58.460 SPEAKER_01: But SAP used to have – well, has a module called the demand-side management module that 00:26:58.460 --> 00:27:04.400 SPEAKER_01: helps sort of manage our program incentives and measures and things like that. 00:27:04.400 --> 00:27:06.480 SPEAKER_01: And SAP is discontinuing support of that. 00:27:06.480 --> 00:27:11.519 SPEAKER_01: So we are in the process of replacing that with a different software tool. 00:27:11.519 --> 00:27:18.180 SPEAKER_01: The timing of being able to get the program information in that tool is probably looking 00:27:18.180 --> 00:27:21.000 SPEAKER_01: closer to the November timeframe. 00:27:21.000 --> 00:27:23.200 SPEAKER_01: But there's some risk there. 00:27:23.200 --> 00:27:28.099 SPEAKER_01: So I would say the team is working to have something as quickly as possible this year. 00:27:28.099 --> 00:27:33.720 SPEAKER_01: But there's a couple of factors that are – that may play a role in how – when exactly it 00:27:33.720 --> 00:27:35.319 SPEAKER_01: gets rolled out. 00:27:37.480 --> 00:27:47.960 Unknown: Thank you for the great report of all the progress you're making. 00:27:47.960 --> 00:27:52.400 SPEAKER_07: There is one group, however, and I'm reminded of it from personal experience recently, 00:27:52.400 --> 00:27:53.759 SPEAKER_07: that we don't help. 00:27:53.759 --> 00:27:58.839 SPEAKER_07: And that's the group of owner-builders who are trying to do projects around their own 00:27:58.839 --> 00:27:59.839 SPEAKER_07: helms. 00:27:59.839 --> 00:28:04.480 SPEAKER_07: They can't apply for and receive most of the SMUD incentives. 00:28:04.480 --> 00:28:09.120 SPEAKER_07: And the way I know this was putting in a heat pump water heater, where I got two bids 00:28:09.120 --> 00:28:13.839 SPEAKER_07: from SMUD contractors and they both came in about $6,000. 00:28:13.839 --> 00:28:23.720 SPEAKER_07: And I put it in myself instead for about three hours and bought the thing from Home Depot. 00:28:23.720 --> 00:28:30.640 SPEAKER_07: And so that extra five grand that we're paying to those contractors didn't really 00:28:30.640 --> 00:28:33.000 SPEAKER_07: help SMUD get this job done. 00:28:33.039 --> 00:28:36.559 SPEAKER_07: And so I wish there was some way, and I know I brought it up in the past, that we could 00:28:36.559 --> 00:28:40.519 SPEAKER_07: come up with a program that owner-builders could take advantage of. 00:28:40.519 --> 00:28:41.519 Unknown: Okay. 00:28:41.519 --> 00:28:43.400 SPEAKER_01: Well, thank you for highlighting that for me. 00:28:43.400 --> 00:28:45.039 SPEAKER_01: We'll definitely take that back to my team. 00:28:45.039 --> 00:28:50.359 SPEAKER_01: One thing I will say that the team has been looking at – and it was part of some of 00:28:50.359 --> 00:28:55.920 SPEAKER_01: the data that came out of the analysis that was done as part of the tech study for both 00:28:55.920 --> 00:29:00.519 SPEAKER_01: the statewide efforts as well as looking at our own service territory – is there is 00:29:00.519 --> 00:29:06.559 SPEAKER_01: a wide range of costs to your point of getting some of these measures installed. 00:29:06.559 --> 00:29:11.480 SPEAKER_01: And one thing that we recognize is because of this very wide cost range could potentially 00:29:11.480 --> 00:29:13.359 SPEAKER_01: obliterate some of the value of incentives. 00:29:13.359 --> 00:29:16.879 SPEAKER_01: I know that's not exactly what you're saying, but my point is that, like, how do 00:29:16.879 --> 00:29:23.720 SPEAKER_01: we think about helping the customers to be able to install these measures in a cost-effective 00:29:23.720 --> 00:29:24.720 SPEAKER_01: way? 00:29:24.720 --> 00:29:27.960 SPEAKER_01: What I hear you're saying is, hey, let me access some of these incentives. 00:29:28.960 --> 00:29:33.559 SPEAKER_07: As soon as the contractor sets foot in my house, they take on all sorts of liability. 00:29:33.559 --> 00:29:34.559 SPEAKER_07: Then they own the warranty. 00:29:34.559 --> 00:29:36.559 SPEAKER_07: There's all kinds of things they've got to worry about. 00:29:36.559 --> 00:29:38.160 SPEAKER_07: You know, they're looking at me. 00:29:38.160 --> 00:29:40.360 SPEAKER_07: They assume I'm going to complain a lot. 00:29:40.360 --> 00:29:43.920 SPEAKER_07: And so there are going to be some after-sales costs. 00:29:43.920 --> 00:29:47.279 SPEAKER_07: But if I'm an owner-builder, all those costs evaporate. 00:29:47.279 --> 00:29:53.759 SPEAKER_07: And so that's how these things could be installed, you know, much more – for a lot less money. 00:29:53.759 --> 00:29:58.680 SPEAKER_07: And I'm remembering that we used to do this because I took advantage of it with the 00:29:58.680 --> 00:30:01.920 SPEAKER_07: whole house fan, where I bought the fan and put it in. 00:30:01.920 --> 00:30:06.440 SPEAKER_07: And if I went through the contractor system, we were rebating $1,000, but we were rebating 00:30:06.440 --> 00:30:12.359 SPEAKER_07: to the homeowner who was installing it themselves $100, which was enough to get me to do it. 00:30:12.359 --> 00:30:17.240 SPEAKER_07: And so I know there's some system here where we can take advantage of these owner-builders 00:30:17.240 --> 00:30:20.680 SPEAKER_07: who are out there building stuff, and a little bit of incentive would push them toward a 00:30:20.680 --> 00:30:22.240 SPEAKER_07: better outcome for us. 00:30:22.319 --> 00:30:25.000 SPEAKER_01: Okay. I will follow up with that with the staff. Thank you. 00:30:25.000 --> 00:30:29.519 Unknown: You may have gotten a bunch of customers here. 00:30:34.519 --> 00:30:37.839 Unknown: I totally agree with Director Crothers' throw that out. 00:30:37.839 --> 00:30:39.519 SPEAKER_05: It's a cosplay. 00:30:39.519 --> 00:30:44.240 SPEAKER_05: I remember I had – my good friend at work was having the house insulation put into her 00:30:44.240 --> 00:30:48.000 SPEAKER_05: attic, and she found that it was – and this is before we changed our contractor network, 00:30:48.000 --> 00:30:52.559 SPEAKER_05: but it was a lot cheaper for her to use someone who was not a part of our network, like half 00:30:52.559 --> 00:30:56.559 SPEAKER_05: the price than to go through the network, although I think that's – this was probably 00:30:56.559 --> 00:30:58.880 SPEAKER_05: six, seven years ago, so we've changed up. 00:30:58.880 --> 00:31:01.559 SPEAKER_05: But it's a good point, right? 00:31:01.559 --> 00:31:06.079 SPEAKER_05: You show your receipt for buying a heat pump hot water heater, right? 00:31:06.079 --> 00:31:07.079 SPEAKER_05: Well, in the permit – 00:31:07.079 --> 00:31:09.079 SPEAKER_05: It's the point of the gesture, right? 00:31:09.079 --> 00:31:13.359 SPEAKER_05: In the permit, right, from the city, because we don't want to buy it here and take it 00:31:13.359 --> 00:31:15.359 SPEAKER_07: to some other county. 00:31:15.359 --> 00:31:18.879 SPEAKER_07: So the permit to install has been signed off, if there ought to be some way to – 00:31:18.879 --> 00:31:20.879 SPEAKER_05: I think – pardon me. 00:31:20.879 --> 00:31:27.719 SPEAKER_05: I've been thinking about especially with the panel replacements and the Zinsco issue, 00:31:27.719 --> 00:31:32.159 SPEAKER_05: it's like, well, I always like us showing a gesture to our customers. 00:31:32.159 --> 00:31:37.639 SPEAKER_05: They pay hundreds of dollars a month for years and decades on end. 00:31:37.639 --> 00:31:43.240 SPEAKER_05: I can see thrown in a couple hundred, $500 towards a panel replacement, but you can make 00:31:43.240 --> 00:31:46.960 SPEAKER_05: their argument, you know, the panel is 70 years old, it's at the end of its life, it's 00:31:46.960 --> 00:31:48.839 SPEAKER_05: your house, it's your panel, you should pay for it. 00:31:48.839 --> 00:31:52.400 SPEAKER_05: So I always think there's a bit of a balancing out there. 00:31:52.400 --> 00:31:58.400 SPEAKER_05: How much of the gestures matter in terms of customer service and showing that we care 00:31:58.400 --> 00:32:05.440 SPEAKER_05: and support our customers, right, who are our owners, and also being strictly like policy 00:32:05.440 --> 00:32:08.319 SPEAKER_05: wants, sort of the train of thought. 00:32:08.319 --> 00:32:13.120 SPEAKER_05: Yeah, and you'll see actually in how we're developing as we finalize how we're developing 00:32:13.119 --> 00:32:16.879 SPEAKER_01: those incentives for smart panels and panel replacements that we've actually do have 00:32:16.879 --> 00:32:18.879 SPEAKER_01: a nod to that point. 00:32:18.879 --> 00:32:24.279 SPEAKER_05: And the last thing I'll say, and I'll be quiet, please send us an update on complete 00:32:24.279 --> 00:32:25.279 SPEAKER_05: energy solutions solicitation. 00:32:25.279 --> 00:32:28.119 SPEAKER_05: I've heard it verbally, but I'd like something in writing. 00:32:28.119 --> 00:32:29.119 Unknown: Okay. 00:32:29.119 --> 00:32:34.839 SPEAKER_01: Yeah, basically I think the staff are getting ready to do demos very soon. 00:32:34.839 --> 00:32:35.839 SPEAKER_01: But happy to do so. 00:32:35.839 --> 00:32:36.839 SPEAKER_01: Just in paragraph. 00:32:36.839 --> 00:32:37.839 Unknown: Yep. 00:32:37.839 --> 00:32:39.239 SPEAKER_01: Any other questions before I go on? 00:32:39.240 --> 00:32:40.240 SPEAKER_01: Just one little comment. 00:32:40.240 --> 00:32:41.240 SPEAKER_00: Sure. 00:32:41.240 --> 00:32:47.480 SPEAKER_00: I do want to say it's really great that we have an emergency water heater replacement 00:32:47.480 --> 00:32:51.880 SPEAKER_00: offering coming because I've had that happen. 00:32:51.880 --> 00:32:54.240 SPEAKER_00: People have asked me about that a couple of times. 00:32:54.240 --> 00:32:56.960 SPEAKER_00: So glad we're looking at that. 00:32:56.960 --> 00:32:57.960 Unknown: Great. 00:32:57.960 --> 00:33:01.000 SPEAKER_01: Yeah, my neighbor texted me and staff were able to help her. 00:33:01.000 --> 00:33:03.319 SPEAKER_01: So those are things that are very important. 00:33:03.319 --> 00:33:04.319 SPEAKER_01: Yes. 00:33:04.319 --> 00:33:05.319 SPEAKER_01: Okay. 00:33:05.319 --> 00:33:06.339 SPEAKER_01: Okay, next slide. 00:33:06.339 --> 00:33:10.419 SPEAKER_01: So this is where we get to showcase some of the great projects that are going on. 00:33:10.419 --> 00:33:16.159 SPEAKER_01: So some notable things in the electrification building energy efficiency space. 00:33:16.159 --> 00:33:20.459 SPEAKER_01: So as you know, getting customers to switch to electric, often one of the key barriers 00:33:20.459 --> 00:33:26.000 SPEAKER_01: is the desire or lack of desire to switch from gas to electric cooking. 00:33:26.000 --> 00:33:30.399 SPEAKER_01: It's a particular challenge as we think about cultural aspects of cooking. 00:33:30.399 --> 00:33:35.079 SPEAKER_01: And wok cooking is one of the hardest, right, because of the value of the wok hay from the 00:33:35.079 --> 00:33:36.079 SPEAKER_01: open flames. 00:33:36.079 --> 00:33:42.179 SPEAKER_01: And that switch to electric isn't just about energy savings or emissions because we want 00:33:42.179 --> 00:33:46.399 SPEAKER_01: to make sure that while that's true, we want to ensure that the food stays true to the 00:33:46.399 --> 00:33:47.399 SPEAKER_01: culture. 00:33:47.399 --> 00:33:53.079 SPEAKER_01: So of that, we are particularly proud, and a number of you are actually in this picture, 00:33:53.079 --> 00:33:56.480 SPEAKER_01: of the Sacramento Asian Sports Foundation. 00:33:56.480 --> 00:34:00.279 SPEAKER_01: In this picture on the left, this is showing the ribbon cutting when they unveiled their 00:34:00.279 --> 00:34:06.019 SPEAKER_01: all electric commercial kitchen with several officials and community partners in attendance. 00:34:06.019 --> 00:34:11.679 SPEAKER_01: This was made possible by the Community Impact Plans Business District electrification program, 00:34:11.679 --> 00:34:15.619 SPEAKER_01: as well as DES's Complete Energy Solutions Small and Medium Business Electrification 00:34:15.619 --> 00:34:16.679 SPEAKER_01: Program. 00:34:16.679 --> 00:34:21.420 SPEAKER_01: They replaced all of their gas appliances with advanced electric cooking equipment, 00:34:21.420 --> 00:34:27.420 SPEAKER_01: including an induction wok station with four woks, a griddle, two combination ovens, a 00:34:27.420 --> 00:34:30.219 SPEAKER_01: deep fryer, and a stock pot station. 00:34:30.219 --> 00:34:33.699 SPEAKER_01: This space is not only going to be used by the organization, which apparently has an 00:34:33.699 --> 00:34:39.539 SPEAKER_01: infamous crab feed, and a huge crab feed that serves very many, but also is going to 00:34:39.539 --> 00:34:43.899 SPEAKER_01: host demonstration and educational sessions to showcase and educate how Asian cooking 00:34:43.899 --> 00:34:45.259 SPEAKER_01: can actually go induction. 00:34:45.259 --> 00:34:49.379 SPEAKER_01: So that's one of those barriers, and it's a great investment and opportunity to partner 00:34:49.379 --> 00:34:54.659 SPEAKER_01: with an agency that's interested in helping us further that education. 00:34:54.659 --> 00:34:59.619 SPEAKER_01: The middle picture is of our now third annual SMUD contractor network event, which was held 00:34:59.619 --> 00:35:04.380 SPEAKER_01: in January and celebrated our participating contractors supporting clean energy projects 00:35:04.380 --> 00:35:06.339 SPEAKER_01: back in 2025. 00:35:06.339 --> 00:35:09.219 SPEAKER_01: Highlights included recognizing top performers. 00:35:09.219 --> 00:35:13.500 SPEAKER_01: We unveiled new heat pump rebates for 2026, and we actually even hosted our first ever 00:35:13.500 --> 00:35:18.539 SPEAKER_01: vendor fair with 41 representatives from various local distributors, manufacturers, as well 00:35:18.539 --> 00:35:20.259 SPEAKER_01: as Go Green financing. 00:35:20.259 --> 00:35:26.699 SPEAKER_01: In 2025, we had 275 participating contractors from the SMUD contractor network. 00:35:26.699 --> 00:35:33.059 SPEAKER_01: They completed over 6,000 projects worth over $12 million in rebates, significantly boosting 00:35:33.059 --> 00:35:36.460 SPEAKER_01: the local economy by an estimated $85 million. 00:35:36.460 --> 00:35:41.179 Unknown: Through our partnership with K-MAX, our very own Zach Lawrence, who is in there in the 00:35:41.179 --> 00:35:42.179 SPEAKER_01: upright. 00:35:42.179 --> 00:35:45.739 SPEAKER_01: He's our supervisor of SMUD's residential building electrification team. 00:35:45.739 --> 00:35:49.539 SPEAKER_01: He was interviewed on K-MAX in a segment that shared the benefits of building electrification 00:35:49.539 --> 00:35:52.179 SPEAKER_01: and getting that message out to our customers. 00:35:52.299 --> 00:35:56.259 SPEAKER_01: And then finally, in the lower right-hand corner is a photo featuring the video that 00:35:56.259 --> 00:36:00.779 SPEAKER_01: was created entitled SMUD is Powering the Places We Call Home. 00:36:00.779 --> 00:36:05.879 SPEAKER_01: With our very own SMUD customers, Joel and Kristin Raythewall, they did energy efficiency 00:36:05.879 --> 00:36:08.059 SPEAKER_01: measures and went all electric with their home. 00:36:08.059 --> 00:36:12.500 SPEAKER_01: They took advantage of our rebates for their electrical panel, a heat pump HVAC system, 00:36:12.500 --> 00:36:17.339 SPEAKER_01: heat pump water heating, induction cooking, and air sealing and insulation. 00:36:17.340 --> 00:36:22.300 SPEAKER_01: So wonderful to see our customers featured in the work that they're doing to go all 00:36:22.300 --> 00:36:23.300 SPEAKER_01: electric. 00:36:23.300 --> 00:36:24.300 Unknown: Next slide. 00:36:24.300 --> 00:36:28.620 SPEAKER_01: I might add that they are part of the Curtis Park Electric Stars. 00:36:28.620 --> 00:36:32.780 SPEAKER_00: Well, that's fantastic so they can spread the message even more. 00:36:32.780 --> 00:36:35.140 Unknown: Okay, transportation electricity. 00:36:35.140 --> 00:36:36.460 SPEAKER_01: Do we have a... 00:36:36.460 --> 00:36:37.460 SPEAKER_05: I'm sure we should... 00:36:37.460 --> 00:36:43.059 SPEAKER_05: Are we getting the feedback from those contractors and giving them a survey and how they do that? 00:36:43.059 --> 00:36:45.820 SPEAKER_05: Yeah, so we survey the contractors within our contractor network. 00:36:45.820 --> 00:36:50.059 SPEAKER_01: As I mentioned, too, we've been doing a lot with the contractor network to help not only... 00:36:50.059 --> 00:36:54.700 SPEAKER_01: We actually do monthly educational sessions with our contractor network, so I try to put 00:36:54.700 --> 00:36:59.220 SPEAKER_01: in the monthly board report what the topic was of that month, just so you know. 00:36:59.220 --> 00:37:03.500 SPEAKER_01: And like I said, we do periodic surveys with our contractor network, and we're trying to 00:37:03.500 --> 00:37:08.180 SPEAKER_01: make sure that we've got a robust contractor network that are doing projects that are relevant 00:37:08.180 --> 00:37:13.660 SPEAKER_01: to our incentive programs and they're up and current so that customers really have those 00:37:13.659 --> 00:37:18.739 SPEAKER_01: options that are with contractors with great experience that's recent. 00:37:18.739 --> 00:37:21.779 Unknown: Okay, transportation electrification. 00:37:21.779 --> 00:37:24.980 SPEAKER_01: Like building electrification, transportation electrification supports our customers and 00:37:24.980 --> 00:37:30.579 SPEAKER_01: our region by both providing carbon emissions reductions as well as energy cost savings 00:37:30.579 --> 00:37:34.579 SPEAKER_01: for our customers while providing revenue to SMUD through beneficial load growth. 00:37:34.579 --> 00:37:38.859 SPEAKER_01: In fact, there's a lot of press about data centers, and I've said this last year, and 00:37:38.859 --> 00:37:42.219 SPEAKER_01: EPRI has an updated slide actually about data centers and EVs. 00:37:42.219 --> 00:37:46.419 SPEAKER_01: And while in the short term it's true that data center load may increase faster, in 00:37:46.419 --> 00:37:51.819 SPEAKER_01: the long run, EPRI still says that EVs is going to be the largest load growth for utilities. 00:37:51.819 --> 00:37:55.659 SPEAKER_01: That's really that long-term growth opportunity. 00:37:55.659 --> 00:37:58.739 SPEAKER_01: Transportation is the number one source of carbon emissions in California, so the switch 00:37:58.739 --> 00:38:03.299 SPEAKER_01: to electric does provide significant carbon savings at a cost that's competitive to market 00:38:03.299 --> 00:38:04.859 SPEAKER_01: prices for carbon. 00:38:04.859 --> 00:38:11.579 SPEAKER_01: In 2025, EVs in our service territory reduced emissions by 228,000 metric tons of carbon 00:38:11.579 --> 00:38:18.019 SPEAKER_01: dioxide equivalent, and in 2026 we expect to reduce a total of 270,000 metric tons. 00:38:18.019 --> 00:38:23.500 SPEAKER_01: And then EV owners in SMUD's territory pocketed an estimated $118 million in gas savings in 00:38:23.500 --> 00:38:32.500 SPEAKER_01: 2025, and we're expected to save $140 million in 2026, so it's pretty significant. 00:38:32.500 --> 00:38:34.900 SPEAKER_01: Next slide. 00:38:34.900 --> 00:38:38.739 SPEAKER_01: So similar to building electrification, we have seen a lot of external headwinds. 00:38:38.739 --> 00:38:42.699 SPEAKER_01: That included the loss of the federal tax credit late last year that expired at the 00:38:42.699 --> 00:38:47.099 SPEAKER_01: end of September, coupled with the run-up of EV adoption given the expiration. 00:38:47.099 --> 00:38:52.699 SPEAKER_01: So 2026 got impacted because everybody raced to go get EVs right before that tax credit 00:38:52.699 --> 00:39:01.059 SPEAKER_01: expiration, so we saw a big spike in 2025, and that obviously impacted us in early 2026. 00:39:01.059 --> 00:39:05.299 SPEAKER_01: The run-up of gas prices that we've seen has helped a bit with EV adoption despite the 00:39:05.300 --> 00:39:10.260 SPEAKER_01: loss of the federal tax credit, and we think that we're going to get close, but we are 00:39:10.260 --> 00:39:12.980 SPEAKER_01: still forecasting to miss the year-end goal. 00:39:12.980 --> 00:39:17.140 SPEAKER_01: But despite that, customer interest does remain strong. 00:39:17.140 --> 00:39:23.260 SPEAKER_01: Based upon research by Cox Automotive and J.D. Powers, 65% of people who intend to buy 00:39:23.260 --> 00:39:30.340 SPEAKER_01: an EV still plan to purchase, and 94% of current owners intend to repurchase an EV. 00:39:30.340 --> 00:39:35.420 SPEAKER_01: So it really makes the gap between intention and purchase that affordability thing, and 00:39:35.420 --> 00:39:41.460 SPEAKER_01: that's obviously impacted by the availability of federal funding and tax credits. 00:39:41.460 --> 00:39:46.460 SPEAKER_01: So efforts underway to bolster adoption include both efforts by SMUD, but actually we are 00:39:46.460 --> 00:39:50.780 SPEAKER_01: also seeing some statewide efforts that are attempting to add some funds where the federal 00:39:50.780 --> 00:39:54.820 SPEAKER_01: government has pulled back, and I'll talk a little bit more about those in the next slide. 00:39:54.820 --> 00:39:59.740 SPEAKER_01: And then SMUD is also planning to increase our EV circuit rebate from 500 to 750 to continue 00:39:59.739 --> 00:40:05.299 SPEAKER_01: to support circuit installation costs with the updated rebate expected in Q3 of this 00:40:05.299 --> 00:40:07.899 SPEAKER_01: year, so coming up very, very soon. 00:40:07.899 --> 00:40:10.619 SPEAKER_01: Next slide. 00:40:10.619 --> 00:40:15.099 SPEAKER_01: So the team has been taking a number of actions to help bolster EV adoption in our territory 00:40:15.099 --> 00:40:18.819 SPEAKER_01: as well as complement those external efforts that are working to try to address some of 00:40:18.819 --> 00:40:24.459 SPEAKER_01: those gaps left by the federal funding pullback with the federal clean vehicle tax credit 00:40:24.459 --> 00:40:27.539 SPEAKER_01: that expired September 30th of last year. 00:40:27.539 --> 00:40:31.059 SPEAKER_01: Just recall, like as you think about our EV growth trajectory, you know, especially 00:40:31.059 --> 00:40:37.380 SPEAKER_01: for 2030, that federal tax credit was expected to originally not expire until 2032, so it 00:40:37.380 --> 00:40:41.420 SPEAKER_01: really gives you a contrast of what we thought was going to be available and what actually 00:40:41.420 --> 00:40:44.340 SPEAKER_01: happened when they pulled back that tax credit. 00:40:44.340 --> 00:40:48.179 SPEAKER_01: We're also doing a lot more work from an outreach standpoint, both to get the message out to 00:40:48.179 --> 00:40:53.179 SPEAKER_01: all of our customers as well as specifically to focus on our disadvantaged communities. 00:40:53.179 --> 00:40:57.219 SPEAKER_01: We've relaunched public EV educational workshops to inform our customers about the benefits 00:40:57.219 --> 00:40:59.980 SPEAKER_01: of going electric for their transportation. 00:40:59.980 --> 00:41:04.419 SPEAKER_01: You've probably seen a lot of the Go electric advertisements and marketing that's been out 00:41:04.419 --> 00:41:05.419 SPEAKER_01: recently. 00:41:05.419 --> 00:41:10.059 SPEAKER_01: Year to date, SMUD has delivered two successful ride and drive events, both at the ECOS event 00:41:10.059 --> 00:41:16.059 SPEAKER_01: as well as in ARDIN, providing a total of 345 in-car EV experiences. 00:41:16.059 --> 00:41:19.739 SPEAKER_01: The ARDIN event actually received CBS 13 media coverage. 00:41:19.739 --> 00:41:25.579 SPEAKER_01: I know it highlighted Abby, who's our program manager for the ride and drives, and really 00:41:25.579 --> 00:41:30.619 SPEAKER_01: highlighted SMUD's commitment to supporting our customers, EV education, as well as increasing 00:41:30.619 --> 00:41:34.259 SPEAKER_01: regional awareness about clean transportation options. 00:41:34.259 --> 00:41:39.179 SPEAKER_01: We're also deepening partnerships with community-based organizations that serve equity and disadvantaged 00:41:39.179 --> 00:41:44.900 SPEAKER_01: communities to provide accessible EV information, build trust within our communities, as well 00:41:44.900 --> 00:41:48.779 SPEAKER_01: as reach customers who have historically faced barriers to EV adoption. 00:41:48.779 --> 00:41:53.539 SPEAKER_01: We actually are preparing three additional ride and drives and three EV educational events 00:41:53.539 --> 00:41:59.940 SPEAKER_01: through October that include participation at North and Thomas's Drive Electric Expo, 00:41:59.940 --> 00:42:04.619 SPEAKER_01: celebrate North Highlands, Capitol Air Show, a micro ride and drive at the South Sacramento 00:42:04.619 --> 00:42:09.500 SPEAKER_01: Christian Center, SMUD's Community Resource Fair, and Caltrans National Drive Electric 00:42:09.500 --> 00:42:12.119 SPEAKER_01: Month celebration. 00:42:12.119 --> 00:42:16.699 SPEAKER_01: This outreach is actually really opportune because despite federal pullback, we do see 00:42:16.699 --> 00:42:22.420 SPEAKER_01: a number of auto OEMs that are starting to introduce EVs priced around the $30,000 range. 00:42:22.420 --> 00:42:28.500 SPEAKER_01: We're starting to see a little bit more availability of used EVs as leases are being turned in. 00:42:28.500 --> 00:42:34.180 SPEAKER_01: There's the 2026 Nissan Leaf and the 2027 Chevy Bolt that are all coming in that $30,000 00:42:34.180 --> 00:42:35.180 SPEAKER_01: range. 00:42:35.180 --> 00:42:39.900 SPEAKER_01: We're also seeing a number of EVs coming out of China that are fully featured and have 00:42:39.900 --> 00:42:45.380 SPEAKER_01: low MSRPs, but unfortunately with the tariffs are really pricing them currently out of the 00:42:45.380 --> 00:42:46.380 SPEAKER_01: market. 00:42:46.380 --> 00:42:51.099 SPEAKER_01: But when and if that changes, that could really unleash additional models for people to choose 00:42:51.099 --> 00:42:54.420 SPEAKER_01: from as they think about EV options. 00:42:54.420 --> 00:42:57.940 SPEAKER_01: And then the Statewide California Clean Fuel Rewards Program, that's the program that's 00:42:57.940 --> 00:43:01.059 SPEAKER_01: funded through the Low Carbon Fuel Standard Credit. 00:43:01.059 --> 00:43:05.539 SPEAKER_01: That transitioned from what was originally a light duty incentive program, a cash on 00:43:05.539 --> 00:43:10.980 SPEAKER_01: the hood program, to incentivized medium and heavy duty vehicle electrification. 00:43:10.980 --> 00:43:17.179 SPEAKER_01: So the California Air Resources Board recognized that that was an opportunity and so transitioned 00:43:17.179 --> 00:43:21.940 SPEAKER_01: that with a launch in, actually I think it was June 26th was the launch date for the 00:43:21.940 --> 00:43:26.980 SPEAKER_01: medium and heavy duty vehicle electrification incentives and that's off to a good start. 00:43:26.980 --> 00:43:30.779 SPEAKER_01: SMUD served on the steering committee for that, helped design that program and launched 00:43:30.779 --> 00:43:35.299 SPEAKER_01: that program which launched on July 26th. 00:43:35.299 --> 00:43:39.219 SPEAKER_01: There is a significant amount of activity in the EV space in adding chargers to our 00:43:39.219 --> 00:43:42.219 SPEAKER_01: region, many through grant funded projects. 00:43:42.219 --> 00:43:46.539 SPEAKER_01: So SMUD is implementing a project under the California Energy Commission funded Reach2 00:43:46.539 --> 00:43:47.539 SPEAKER_01: grant. 00:43:47.539 --> 00:43:52.340 SPEAKER_01: This is working to expand equitable access to EV charging infrastructure in SMUD's disadvantaged 00:43:52.340 --> 00:43:57.659 SPEAKER_01: communities by deploying a scalable, replicable model for charging access at multifamily and 00:43:57.659 --> 00:44:02.019 SPEAKER_01: multifamily adjacent properties supporting clean transportation goals. 00:44:02.019 --> 00:44:07.320 SPEAKER_01: We were awarded $5 million and the project is targeting 400 Level 2 chargers. 00:44:07.320 --> 00:44:14.300 SPEAKER_01: We have MOUs in place and signed for 342 of the 400 handles and are working to recruit 00:44:14.300 --> 00:44:20.500 SPEAKER_01: those remaining handles for the completion of the grant which is scheduled for May 31st 00:44:20.500 --> 00:44:21.500 SPEAKER_01: of 2027. 00:44:21.500 --> 00:44:26.780 SPEAKER_01: So we got a little bit of time to finish up and get those last couple of handles. 00:44:26.780 --> 00:44:30.560 SPEAKER_01: Recognizing the need for diverse charging options, SMUD is also implementing a project 00:44:30.560 --> 00:44:35.780 SPEAKER_01: under the CEC funded FAST grant where we were awarded $2.8 million to support EV charging 00:44:35.780 --> 00:44:41.780 SPEAKER_01: infrastructure for high mileage, on demand transportation services, car sharing enterprises 00:44:41.780 --> 00:44:44.460 SPEAKER_01: as well as car rental agencies in the public. 00:44:44.460 --> 00:44:50.019 SPEAKER_01: This project that's already underway will support the deployment of two 150KW DC FAST 00:44:50.019 --> 00:44:55.860 SPEAKER_01: charging hubs with a total of 13 stations and 26 ports in strategically chosen locations 00:44:55.860 --> 00:45:00.220 SPEAKER_01: with high on demand transportation volume and quick and easy access to main transportation 00:45:00.220 --> 00:45:01.460 SPEAKER_01: corridors. 00:45:01.460 --> 00:45:05.460 SPEAKER_01: So six stations are going to be located at the Capitol Public Radio station parking lot 00:45:05.460 --> 00:45:08.680 SPEAKER_01: on CSUS's campus near Folsom Boulevard. 00:45:08.679 --> 00:45:13.000 SPEAKER_01: And seven stations will be located in the new rideshare driver waiting lot at the Sacramento 00:45:13.000 --> 00:45:16.559 SPEAKER_01: Airport with a forecasted commissioning date of early next year. 00:45:16.559 --> 00:45:20.599 SPEAKER_01: And that grant also finishes up at the end of March. 00:45:20.599 --> 00:45:25.480 SPEAKER_01: With regards to the EV charging in addition to the FAST grant, FAST grant DC FAST chargers 00:45:25.480 --> 00:45:29.940 SPEAKER_01: at Sacramento Airport, the airport is continuing development of the new rental car agency 00:45:29.940 --> 00:45:35.799 SPEAKER_01: facility which includes EV charging infrastructure to support rental car fleet electrification. 00:45:35.800 --> 00:45:39.560 SPEAKER_01: Works on this project and details on the numbers of handles and types are still being 00:45:39.560 --> 00:45:44.360 SPEAKER_01: developed because completion is expected to align with the timeline for a bulk substation 00:45:44.360 --> 00:45:49.680 SPEAKER_01: coming online around 2030 as the car rental agency's project demand is expected to exceed 00:45:49.680 --> 00:45:50.680 SPEAKER_01: available capacity. 00:45:50.680 --> 00:45:58.240 SPEAKER_01: So the strategic account advisors are very actively engaged with the airport team and 00:45:58.240 --> 00:46:01.220 SPEAKER_01: working with them as they go through each stage of planning. 00:46:01.219 --> 00:46:06.199 SPEAKER_01: And my team is also engaged to support that EV charging adoption which we expect to probably 00:46:06.199 --> 00:46:11.480 SPEAKER_01: be a mix of level 2 charging as well as maybe some FAST charging. 00:46:11.480 --> 00:46:16.439 SPEAKER_01: In addition, in order to ensure that we can support the load growth from electrification, 00:46:16.439 --> 00:46:21.519 SPEAKER_01: we continue to refine our analysis and we completed an updated integration integrated 00:46:21.519 --> 00:46:23.199 SPEAKER_01: distribution resources plan. 00:46:23.199 --> 00:46:26.319 SPEAKER_01: So the last time we did that was actually before the 2030 plan. 00:46:26.319 --> 00:46:27.959 SPEAKER_01: So it's a little bit of a while. 00:46:27.980 --> 00:46:31.440 SPEAKER_01: It informs SMUD on what infrastructure is needed to support the load growth and explores 00:46:31.440 --> 00:46:35.340 SPEAKER_01: the potential for DERs to help mitigate the grid investment cost needed. 00:46:35.340 --> 00:46:39.619 SPEAKER_01: This analysis we're actually going to be bringing to the board in an upcoming board meeting. 00:46:39.619 --> 00:46:40.619 Unknown: Yes. 00:46:40.619 --> 00:46:48.300 Unknown: The DC FAST charger numbers seem like we're falling behind there. 00:46:48.300 --> 00:46:49.300 SPEAKER_06: Our goal was 20. 00:46:49.300 --> 00:46:51.619 SPEAKER_06: We're going to get maybe to 9. 00:46:51.619 --> 00:46:54.019 SPEAKER_06: We had 59 last year. 00:46:54.019 --> 00:46:55.780 SPEAKER_06: Why the drop off there? 00:46:55.800 --> 00:46:57.560 SPEAKER_01: A lot of it is funding. 00:46:57.560 --> 00:47:04.880 SPEAKER_01: So I think there is there was a lot of grant funding available and with the federal funding 00:47:04.880 --> 00:47:08.240 SPEAKER_01: pullback, there just hasn't been as many. 00:47:08.240 --> 00:47:10.880 SPEAKER_01: I think we are still trying to support. 00:47:10.880 --> 00:47:14.760 SPEAKER_01: So in addition to the FAST grant where the team has been working with regards to those 00:47:14.760 --> 00:47:20.280 SPEAKER_01: specific projects, the Amtrak station replacement actually was originally part of FAST but because 00:47:20.280 --> 00:47:25.820 SPEAKER_01: of timing and funding got pulled out but we've actually re-added back the Amtrak station 00:47:25.820 --> 00:47:27.500 SPEAKER_01: back in so we'll be doing that. 00:47:27.500 --> 00:47:28.500 SPEAKER_01: But you're right. 00:47:28.500 --> 00:47:31.860 SPEAKER_01: It is smaller than what it's been in the past. 00:47:31.860 --> 00:47:34.540 SPEAKER_06: These are just projects that we have a direct role in, correct? 00:47:34.540 --> 00:47:35.540 SPEAKER_06: Yes. 00:47:35.540 --> 00:47:38.380 SPEAKER_06: It's not total number of DC FAST chargers in our service here. 00:47:38.380 --> 00:47:39.380 SPEAKER_06: Yes. 00:47:39.380 --> 00:47:42.820 SPEAKER_01: These are the ones that are incentivized through our programs or participating in our programs. 00:47:42.820 --> 00:47:49.940 SPEAKER_06: The Bellaire store near my house at Eastern and Arden, they're about to commission I think 00:47:49.940 --> 00:47:56.280 SPEAKER_06: like eight or nine new Tesla handles that are I think they qualify as DC FAST chargers 00:47:56.280 --> 00:47:57.400 SPEAKER_06: or leave most of them. 00:47:57.400 --> 00:47:59.639 SPEAKER_06: So they're not counted in these numbers. 00:47:59.639 --> 00:48:02.039 SPEAKER_01: They're not counted in these program numbers. 00:48:02.039 --> 00:48:03.280 SPEAKER_06: Correct. 00:48:03.280 --> 00:48:04.599 Unknown: Okay. 00:48:04.599 --> 00:48:11.720 Unknown: I think many of you may have also heard that California did allocate dollars in their budget 00:48:11.720 --> 00:48:16.720 SPEAKER_01: to provide some incentive dollars to help bolster EV adoption given the federal pullback. 00:48:16.719 --> 00:48:24.739 SPEAKER_01: So California did launch the My First EV program last month that provides $1,750 to $3,500 00:48:24.739 --> 00:48:27.059 SPEAKER_01: off a new or used electric vehicle. 00:48:27.059 --> 00:48:32.139 SPEAKER_01: The state's $130 million investment is matched by select automakers and is intended to help 00:48:32.139 --> 00:48:37.059 SPEAKER_01: shore up that support for the EVs within the state of California. 00:48:37.059 --> 00:48:41.059 SPEAKER_01: And then looking ahead, we are finishing up the deployment or the development of the SMUD 00:48:41.059 --> 00:48:43.779 SPEAKER_01: public charging EV app with SEW. 00:48:43.780 --> 00:48:47.019 SPEAKER_01: We're working on a project to enable that pricing program that we've been talking about 00:48:47.019 --> 00:48:51.900 SPEAKER_01: for a while that will enable us to provide discounted public EV charging for income-qualified 00:48:51.900 --> 00:48:57.180 SPEAKER_01: customers as well as transportation network drivers to help improve that access to low-cost 00:48:57.180 --> 00:48:59.820 SPEAKER_01: charging within our service territory. 00:48:59.820 --> 00:49:04.740 SPEAKER_01: And then while our commercial EV program already incentivizes smart outlets as featured with 00:49:04.740 --> 00:49:09.900 SPEAKER_01: the Bridgway Estates project that we featured in last year's board presentation, we're actually 00:49:09.900 --> 00:49:16.260 SPEAKER_01: looking closely at how we can leverage smart outlets, particularly in the multifamily space, 00:49:16.260 --> 00:49:21.300 SPEAKER_01: as well as a potential alternative for avoiding vandalism situations. 00:49:21.300 --> 00:49:27.019 SPEAKER_01: We have been, unfortunately, seeing some of them with our community impact plan projects, 00:49:27.019 --> 00:49:31.500 SPEAKER_01: unfortunately, where we've seen some vandalism of EV charging cords being cut. 00:49:31.500 --> 00:49:37.180 SPEAKER_01: And so think that this might be a great opportunity to help address some of that as well and continue 00:49:37.179 --> 00:49:40.899 SPEAKER_01: to grow charging options across the various customer segments. 00:49:40.899 --> 00:49:45.659 SPEAKER_01: We are going to be finishing up both Reach2 and FAST grant projects and charging installations, 00:49:45.659 --> 00:49:49.019 SPEAKER_01: as I mentioned, by the end of March, which is when the grant completes. 00:49:49.019 --> 00:49:51.339 SPEAKER_01: And we are planning for future vehicle-to-grid opportunities. 00:49:51.339 --> 00:49:57.099 SPEAKER_01: I know James Frazier is going to be coming to the board talking about SD10 and innovation 00:49:57.099 --> 00:50:01.059 SPEAKER_01: in a couple weeks, I believe, and he'll go into more detail about the work that the R&D 00:50:01.059 --> 00:50:03.019 SPEAKER_01: team is doing in that space. 00:50:04.019 --> 00:50:12.900 Unknown: With the grant funding, I know the price of the DC FAST chargers have gone down significantly. 00:50:12.900 --> 00:50:20.139 SPEAKER_04: What has been the average cost and how much of that per station has been grant funded? 00:50:20.139 --> 00:50:23.420 Unknown: I don't know off the top of my head, but I'm happy to follow up. 00:50:23.420 --> 00:50:24.420 SPEAKER_01: I know it's gone down. 00:50:24.420 --> 00:50:27.780 SPEAKER_01: Yes, the costs have gone down. 00:50:27.780 --> 00:50:34.140 SPEAKER_04: And then for the EV charging app, where are we on launching something? 00:50:34.140 --> 00:50:38.300 SPEAKER_04: I know that there's been a lot of discussion about trying to do it multiple. 00:50:38.300 --> 00:50:42.620 SPEAKER_04: We have like a million charging networks here. 00:50:42.620 --> 00:50:46.100 SPEAKER_04: Where are we on just picking one so we can just get something off the ground so we can 00:50:46.100 --> 00:50:47.940 SPEAKER_04: see if the app even works? 00:50:47.940 --> 00:50:55.740 SPEAKER_01: Yeah, so we are in the testing phase of the app that's been developed with SEW. 00:50:55.739 --> 00:50:58.859 SPEAKER_01: The key is what chargers the EV app works with. 00:50:58.859 --> 00:51:02.500 SPEAKER_01: To your point about like can it work with multiple chargers and things like that, SEW 00:51:02.500 --> 00:51:08.339 SPEAKER_01: has worked with ChargeHub to be able to provide access to different charging networks. 00:51:08.339 --> 00:51:19.099 SPEAKER_01: I think we are looking at when to launch the app relative to operational support for the 00:51:19.099 --> 00:51:22.059 SPEAKER_01: program relative to things like the pricing program. 00:51:22.059 --> 00:51:27.219 SPEAKER_01: So we are hoping to get all the testing done. 00:51:27.219 --> 00:51:29.340 SPEAKER_01: Like I said, the testing is going on right now. 00:51:29.340 --> 00:51:34.500 SPEAKER_01: But I think that we have a supplemental project that we have to work on to really kind of 00:51:34.500 --> 00:51:40.139 SPEAKER_01: complete all the functionality that we will be submitting for prioritization this year. 00:51:40.139 --> 00:51:45.179 SPEAKER_01: So hopefully we can get some work done to have some availability next year is the hope. 00:51:45.179 --> 00:51:49.579 Unknown: Do you think sometime next year we might see a pilot of some sort? 00:51:49.579 --> 00:51:50.579 SPEAKER_01: Yes. 00:51:50.579 --> 00:51:58.099 SPEAKER_01: Rachel, can I ask you, are you done with this slide? 00:51:58.099 --> 00:52:00.539 SPEAKER_05: Yeah, we can be done with this slide. 00:52:00.539 --> 00:52:01.539 SPEAKER_05: Okay. 00:52:01.539 --> 00:52:07.420 Unknown: I just wanted to ask you a little bit about your thoughts on the heavy duty side, which 00:52:07.420 --> 00:52:09.019 SPEAKER_05: is always near and dear to my heart. 00:52:09.019 --> 00:52:13.059 SPEAKER_05: Do you just need that as an open question for you? 00:52:13.059 --> 00:52:16.019 Unknown: Oh, well, a couple things. 00:52:17.019 --> 00:52:22.900 SPEAKER_01: So the integrated distribution resources plan analysis, IDRP, that I said that we will be 00:52:22.900 --> 00:52:29.179 SPEAKER_01: bringing to the board in an upcoming board meeting, actually did try to provide a refined 00:52:29.179 --> 00:52:34.219 SPEAKER_01: estimate of medium and heavy duty vehicle electrification versus sort of the very high 00:52:34.219 --> 00:52:37.699 SPEAKER_01: level estimate that we did in the last IDRP. 00:52:37.699 --> 00:52:41.139 SPEAKER_01: And then also you are probably familiar and I have talked about in the past the work that 00:52:41.859 --> 00:52:47.379 SPEAKER_01: we did with the CEC Blueprint funding relative to medium and heavy duty vehicle electrification. 00:52:47.379 --> 00:52:51.500 SPEAKER_01: The other thing to consider though is there is also that federal funding pullback that 00:52:51.500 --> 00:52:55.059 SPEAKER_01: is also impacting medium and heavy duty vehicle electrification. 00:52:55.059 --> 00:53:00.059 SPEAKER_01: And the reality is, is most are saying that that is probably slowed down versus what that 00:53:00.059 --> 00:53:03.420 SPEAKER_01: original trajectory of adoption is going to be. 00:53:03.420 --> 00:53:10.539 SPEAKER_01: I think that is why things like the switch for the LCFS funding to helping support adoption 00:53:10.539 --> 00:53:13.179 SPEAKER_01: of medium and heavy duty vehicles is helpful. 00:53:13.179 --> 00:53:17.500 SPEAKER_01: I think there is still going to be fleets that look at it from a financial opportunity 00:53:17.500 --> 00:53:23.460 SPEAKER_01: standpoint because of the cost of gas, the maintenance pieces. 00:53:23.460 --> 00:53:27.420 SPEAKER_01: And so I don't think fleets are not adopting them, but I think it is just not at the same 00:53:27.420 --> 00:53:29.579 SPEAKER_01: pace that we had originally anticipated. 00:53:29.579 --> 00:53:33.820 SPEAKER_01: So how we are looking at it from SMUD is, you know, what are the things that we can 00:53:33.820 --> 00:53:36.820 SPEAKER_01: do to continue to support that adoption? 00:53:36.820 --> 00:53:40.820 SPEAKER_01: And then how do we think about the charging infrastructure needed to support that adoption 00:53:40.820 --> 00:53:41.820 SPEAKER_01: as well? 00:53:41.820 --> 00:53:43.780 SPEAKER_01: And that is really what our focus is on. 00:53:43.780 --> 00:53:47.019 SPEAKER_01: So we don't think adoption is going to stop. 00:53:47.019 --> 00:53:51.539 SPEAKER_01: We think LCFS, that clean fuel rewards program will help, but it is just not going to be 00:53:51.539 --> 00:53:52.539 SPEAKER_01: on the same trajectory. 00:53:52.539 --> 00:54:00.740 SPEAKER_01: Because I know our technical assistance program with Black and Beach, I think, remember last 00:54:00.739 --> 00:54:05.899 SPEAKER_05: week said it wasn't having a huge strong demand in that. 00:54:05.899 --> 00:54:08.939 SPEAKER_05: Is like the WAD-EV project still progressing? 00:54:08.939 --> 00:54:10.979 Unknown: I don't have the latest on the WAD-EV. 00:54:10.979 --> 00:54:15.379 SPEAKER_01: I know the customer side has continued to work with that team with regards to kind of 00:54:15.379 --> 00:54:16.379 SPEAKER_01: where they are. 00:54:16.379 --> 00:54:17.699 SPEAKER_01: So I can find out the status of that. 00:54:17.699 --> 00:54:19.099 SPEAKER_01: I think it is something to think about. 00:54:19.099 --> 00:54:21.179 SPEAKER_05: Diesel is over $8 a gallon. 00:54:21.179 --> 00:54:22.179 SPEAKER_05: Yeah. 00:54:22.179 --> 00:54:25.899 SPEAKER_01: That is the balance with EVs, right, which is the cost of gasoline and diesel right now 00:54:25.900 --> 00:54:31.019 SPEAKER_01: is so high that it has helped some degree of EV adoption, but just not that full recovery 00:54:31.019 --> 00:54:34.740 SPEAKER_01: of the original trajectories that we were anticipating. 00:54:34.740 --> 00:54:36.380 SPEAKER_05: Thank you. 00:54:36.380 --> 00:54:38.500 SPEAKER_01: Next slide. 00:54:38.500 --> 00:54:42.880 SPEAKER_01: So for transportation electrification, I'm going to speed up a little bit. 00:54:42.880 --> 00:54:47.139 SPEAKER_01: So highlights from a project standpoint, I talked about a REACH2 grant project that is 00:54:47.139 --> 00:54:51.780 SPEAKER_01: working to expand that equitable access to EV charging infrastructure in SMUD's disadvantaged 00:54:51.780 --> 00:54:52.780 SPEAKER_01: communities. 00:54:52.780 --> 00:54:58.019 SPEAKER_01: The middle top picture on the left showcases the Salishan Apartments, where 18 Level 2 00:54:58.019 --> 00:55:01.500 SPEAKER_01: chargers were installed in three different areas of the apartment complex to ensure easy 00:55:01.500 --> 00:55:03.420 SPEAKER_01: access for its residents. 00:55:03.420 --> 00:55:07.340 SPEAKER_01: This site is actually one of the first two projects to be completed under the REACH2 00:55:07.340 --> 00:55:08.340 SPEAKER_01: grant. 00:55:08.340 --> 00:55:12.040 SPEAKER_01: In the middle, on the top, you know, work with development is really, really key and 00:55:12.040 --> 00:55:17.180 SPEAKER_01: necessary in order to support this transportation electrification adoption, as well as to support 00:55:17.180 --> 00:55:20.380 SPEAKER_01: economic development and prosperity from a zero carbon plan. 00:55:20.380 --> 00:55:25.019 SPEAKER_01: So the middle top picture showcases the training that the e-fuel program did for five of the 00:55:25.019 --> 00:55:29.660 SPEAKER_01: fusion electricians for certification on installation and commissioning of the chem power equipment 00:55:29.660 --> 00:55:31.380 SPEAKER_01: that's going in. 00:55:31.380 --> 00:55:37.300 SPEAKER_01: This training was held at the Cal-EPIC facility, and supporting the charger deployments under 00:55:37.300 --> 00:55:38.660 SPEAKER_01: the FAST grant. 00:55:38.660 --> 00:55:42.820 SPEAKER_01: The bottom middle photo features construction underway at Sac State, with all the boring 00:55:42.820 --> 00:55:47.140 SPEAKER_01: complete and the SMUD primary inspections passed for Rule 16 equipment, make ready. 00:55:47.139 --> 00:55:50.099 SPEAKER_01: Those have placed all the conduit and have backfilled the trenches. 00:55:50.099 --> 00:55:54.500 SPEAKER_01: That's for the FAST charger that's going in by Capital Public Radio. 00:55:54.500 --> 00:55:59.019 SPEAKER_01: And then at the right features our very own director, Rosanna Herber, with our program 00:55:59.019 --> 00:56:05.539 SPEAKER_01: manager, Abby Visvanathan, at the Eco's Earth Day Ride and Drive event at Southside Park 00:56:05.539 --> 00:56:08.259 SPEAKER_01: earlier this year. 00:56:08.259 --> 00:56:09.259 SPEAKER_01: Next slide. 00:56:09.259 --> 00:56:10.259 Unknown: Okay. 00:56:10.259 --> 00:56:15.500 SPEAKER_01: It's a great photo showing your trenching and all your brace paper calls. 00:56:15.500 --> 00:56:17.340 SPEAKER_05: It is in construction. 00:56:17.340 --> 00:56:20.219 SPEAKER_01: Those projects are in construction for sure. 00:56:20.219 --> 00:56:21.219 SPEAKER_01: Okay. 00:56:21.219 --> 00:56:23.579 SPEAKER_01: Distributed energy resources and load flexibility. 00:56:23.579 --> 00:56:27.940 SPEAKER_01: So those are the programs that help shift and manage loads to maximize the use of our 00:56:27.940 --> 00:56:32.260 SPEAKER_01: renewable energy generation, create capacity where and when needed to support the bulk 00:56:32.260 --> 00:56:33.780 SPEAKER_01: system or the localized grid. 00:56:33.780 --> 00:56:37.340 SPEAKER_01: And in the future, we'll help us be able to take advantage of market participation to 00:56:37.340 --> 00:56:39.039 SPEAKER_01: optimize resources. 00:56:39.039 --> 00:56:43.219 SPEAKER_01: You may recall on our zero carbon plan, we're aiming to achieve 634 megawatts. 00:56:43.219 --> 00:56:47.139 SPEAKER_01: That was the minimum sports, mud zero carbon efforts for new technologies and business 00:56:47.139 --> 00:56:48.139 SPEAKER_01: models. 00:56:48.139 --> 00:56:53.019 SPEAKER_01: And this is where our customers can help manage their energy use, can actually help support 00:56:53.019 --> 00:56:58.379 SPEAKER_01: reduced incentives in alternate utility scale resources, and can be cost competitive, potentially 00:56:58.379 --> 00:57:01.059 SPEAKER_01: alleviating grid constraints. 00:57:01.059 --> 00:57:02.500 SPEAKER_01: Next slide. 00:57:02.500 --> 00:57:06.379 SPEAKER_01: For the load flexibility portfolio, despite a large amount of activity in the residential 00:57:06.379 --> 00:57:10.519 SPEAKER_01: battery energy storage space through our My Energy Partner Plus program, we are still 00:57:10.519 --> 00:57:15.420 SPEAKER_01: falling short of our annual goal at the portfolio level, as well as coming very close, but just 00:57:15.420 --> 00:57:19.079 SPEAKER_01: a bit short of our 26 goal under the zero carbon plan. 00:57:19.079 --> 00:57:30.139 SPEAKER_01: There is a theme that I want you guys to keep in mind to ensure that the load flexibility 00:57:30.139 --> 00:57:36.480 SPEAKER_01: that we provide is robust, is cost effective, and are reliable resources. 00:57:36.480 --> 00:57:41.039 SPEAKER_01: That's really critical for the DERs to be able to play a role in both helping support 00:57:41.039 --> 00:57:44.760 SPEAKER_01: electrification load growth, as well as integrating renewables. 00:57:44.760 --> 00:57:49.880 SPEAKER_01: This means that while we may have lower megawatts total for the portfolio that you see at the 00:57:49.880 --> 00:57:54.880 SPEAKER_01: end of the year from the forecast, we do actually have more confidence in the value that those 00:57:54.880 --> 00:57:59.880 SPEAKER_01: megawatts that are coming are intending to provide and have adjusted our programs as 00:57:59.880 --> 00:58:00.880 SPEAKER_01: such. 00:58:00.880 --> 00:58:02.519 SPEAKER_01: I'm going to give a little bit more detail in the next slide. 00:58:02.519 --> 00:58:05.559 SPEAKER_01: You can see the evidence of this in actually our April May results, because you're like, 00:58:05.559 --> 00:58:08.679 SPEAKER_01: why did you go from 82.3 down to 80.4? 00:58:08.679 --> 00:58:11.480 SPEAKER_01: Like theoretically, usually you're adding customers. 00:58:11.480 --> 00:58:12.799 SPEAKER_01: What was that step change? 00:58:12.799 --> 00:58:15.320 SPEAKER_01: I'll go into a little bit more detail in the next slide. 00:58:15.320 --> 00:58:21.400 SPEAKER_01: Really, we ended up changing the event hours for our commercial power direct program. 00:58:21.400 --> 00:58:26.079 SPEAKER_01: We recognized the teamwork with resource planning to assess the value of the program, and we've 00:58:26.079 --> 00:58:30.900 SPEAKER_01: had a certain program design with certain event hours in the past, and we had them give 00:58:30.900 --> 00:58:34.199 SPEAKER_01: us an updated value of the program with those event hours. 00:58:34.199 --> 00:58:38.919 SPEAKER_01: What came back from the analysis is that because our resource mix is changing, the 00:58:38.919 --> 00:58:43.000 SPEAKER_01: value of those resources from that timeframe were no longer as valuable as they used to 00:58:43.000 --> 00:58:44.719 SPEAKER_01: be. 00:58:44.719 --> 00:58:48.559 SPEAKER_01: We instituted a change to the event hours, and that actually resulted in a change of 00:58:48.559 --> 00:58:52.919 SPEAKER_01: some of our customers' ability to participate in the load flexibility for those changed 00:58:52.919 --> 00:58:55.879 SPEAKER_01: hours in that new time window. 00:58:55.879 --> 00:58:59.119 SPEAKER_01: What we've done is we haven't dropped those customers, but what we did is we didn't call 00:58:59.119 --> 00:59:02.759 SPEAKER_01: on those customers for summer events this year, and we're actually working with that 00:59:02.760 --> 00:59:07.000 SPEAKER_01: customer through our program design, and I'll tell more about it in a second, to see 00:59:07.000 --> 00:59:10.320 SPEAKER_01: what future opportunities there is for them to participate in load flexibility for the 00:59:10.320 --> 00:59:12.160 SPEAKER_01: hours that they can flex. 00:59:12.160 --> 00:59:16.220 SPEAKER_01: This is just an example of one of the evolutions we're doing with our programs, and I'll cover 00:59:16.220 --> 00:59:18.680 SPEAKER_01: more in the next slide. 00:59:18.680 --> 00:59:20.720 SPEAKER_01: Okay, next slide. 00:59:20.720 --> 00:59:21.720 SPEAKER_01: The details. 00:59:21.720 --> 00:59:26.960 SPEAKER_01: We've seen, as you can see on the very top, for My Energy Optimizer batteries, we've seen 00:59:26.960 --> 00:59:31.560 SPEAKER_01: overwhelming interest in our My Energy Optimizer Partner Plus program, which is our residential 00:59:31.560 --> 00:59:32.560 SPEAKER_01: battery storage program. 00:59:32.559 --> 00:59:37.119 SPEAKER_01: We are forecasting to achieve over double our 2026 goal, delivering over 19 megawatts 00:59:37.119 --> 00:59:39.480 SPEAKER_01: of capacity through the end of July this year. 00:59:39.480 --> 00:59:43.880 SPEAKER_01: We've actually already surpassed what our trajectory was for our 2028 goals for that 00:59:43.880 --> 00:59:46.480 SPEAKER_01: program in 2026 alone. 00:59:46.480 --> 00:59:50.960 SPEAKER_01: Given the success and to better align the incentives to the value of the resource, we 00:59:50.960 --> 00:59:55.559 SPEAKER_01: are reducing the upfront enrollment incentives starting September 23rd. 00:59:55.559 --> 00:59:59.980 SPEAKER_01: Those upfront incentives will be reduced for projects submitted for interconnection on 00:59:59.980 --> 01:00:06.719 SPEAKER_01: or after September 23rd from the $500 to $300 per kilowatt hour with a maximum cap 01:00:06.719 --> 01:00:09.099 SPEAKER_01: of $6,000 per household. 01:00:09.099 --> 01:00:12.539 SPEAKER_01: The higher incentive will still be honored for customers who submit for interconnection 01:00:12.539 --> 01:00:17.300 SPEAKER_01: on or before September 22nd and enrolled in the customer by the end of the year, so the 01:00:17.300 --> 01:00:18.300 SPEAKER_01: program by the end of the year. 01:00:18.300 --> 01:00:20.900 SPEAKER_01: So really, we want to make sure that those projects are getting done. 01:00:20.900 --> 01:00:25.500 SPEAKER_01: But something to note, even with this incentive change, SMUD continues to offer one of the 01:00:25.500 --> 01:00:28.740 SPEAKER_01: most generous battery incentives in the nation. 01:00:28.819 --> 01:00:33.339 SPEAKER_01: I know of utilities that are offering like $500 for a battery storage system. 01:00:33.339 --> 01:00:39.419 SPEAKER_01: So while supporting affordability and our decarbonization goals, the program achieved 01:00:39.419 --> 01:00:45.979 SPEAKER_01: several other key milestones in 2026, including the development of full operational processes 01:00:45.979 --> 01:00:51.179 SPEAKER_01: for both bulk system and distribution level dispatches, and it successfully delivered 01:00:51.179 --> 01:00:53.819 SPEAKER_01: its first customer events during the summer season. 01:00:53.819 --> 01:00:58.179 SPEAKER_01: That point about distribution level dispatches, so the distribution operations team actually 01:00:58.179 --> 01:01:03.619 SPEAKER_01: reached out to the load flex team this year in June because they had substation upgrade 01:01:03.619 --> 01:01:09.500 SPEAKER_01: work in the Orangevale and Citrus Heights area and asked the battery storage program 01:01:09.500 --> 01:01:14.059 SPEAKER_01: if we could actually dispatch batteries in that specific location to help out. 01:01:14.059 --> 01:01:18.819 SPEAKER_01: And what we're able to do is it's demonstrating growing operational integration as well as 01:01:18.819 --> 01:01:23.899 SPEAKER_01: confidence in the program's abilities, and that's a really, really big win for us. 01:01:23.899 --> 01:01:26.940 SPEAKER_01: Consistent with the theme I mentioned the portfolio, this summer for our Smart Thermostat 01:01:26.940 --> 01:01:33.340 SPEAKER_01: program we launched an energy shift capacity pilot to test new load shaping strategies. 01:01:33.340 --> 01:01:34.659 SPEAKER_01: We partnered with Renew Home. 01:01:34.659 --> 01:01:38.740 SPEAKER_01: They're the ones that provide the Google Nest thermostat load flexibility platform. 01:01:38.740 --> 01:01:42.500 SPEAKER_01: They've developed an innovative offering that increases thermostat load shifting capability 01:01:42.500 --> 01:01:48.099 SPEAKER_01: by adjusting the customer thermostat by a half to two degrees during peak demand events. 01:01:48.099 --> 01:01:53.139 SPEAKER_01: The pilot did test the ability to materially enhance the performance that we're getting 01:01:53.139 --> 01:01:56.139 SPEAKER_01: from that program during long duration events, right? 01:01:56.139 --> 01:02:00.619 SPEAKER_01: That's the hard part is like during the multi-hour events we get great performance in the first 01:02:00.619 --> 01:02:02.819 SPEAKER_01: hour and then it kind of decreases in the second hour. 01:02:02.819 --> 01:02:08.500 SPEAKER_01: So we're trying to figure out how do we really maximize the performance and aggregating that 01:02:08.500 --> 01:02:11.739 SPEAKER_01: resource while potentially improving cost effectiveness because we want to make sure 01:02:11.739 --> 01:02:13.779 SPEAKER_01: that these are cost effective resources. 01:02:13.779 --> 01:02:17.500 SPEAKER_01: So those pilot results are going to help us determine in the long-term scalability and 01:02:17.500 --> 01:02:20.940 SPEAKER_01: integration of the solution into SMUD's load flex portfolio. 01:02:20.940 --> 01:02:25.980 SPEAKER_01: We're also working to identify free riders who receive incentives but don't contribute 01:02:25.980 --> 01:02:28.420 SPEAKER_01: to load reductions during events. 01:02:28.420 --> 01:02:32.539 SPEAKER_01: So I think we've given the board a heads up that we're going to be sending out communication 01:02:32.539 --> 01:02:36.740 Unknown: to Google Nest customers who opt out of 60% of peak event minutes. 01:02:36.740 --> 01:02:38.300 SPEAKER_01: Now we're not saying, hey, we're dropping you. 01:02:38.300 --> 01:02:41.420 SPEAKER_01: We're saying like, hey, we noticed that you haven't been opting out. 01:02:41.420 --> 01:02:43.059 SPEAKER_01: Is this still a good fit for you? 01:02:43.059 --> 01:02:44.820 SPEAKER_01: So really putting it with the customer. 01:02:44.820 --> 01:02:48.940 SPEAKER_01: But what we want to do is we want to ensure that the program includes customers that feel 01:02:48.940 --> 01:02:53.340 SPEAKER_01: that this program is a good fit for them and that their resources can have the confidence 01:02:53.340 --> 01:02:59.380 SPEAKER_01: to show up to be able to provide those resources and the reliability of them to the grid when 01:02:59.380 --> 01:03:05.099 SPEAKER_01: an event is called as well as continue to optimize for program costs. 01:03:05.099 --> 01:03:09.500 Unknown: I mentioned in the previous slide the event hours for PowerDirect but just a little bit 01:03:09.500 --> 01:03:10.500 SPEAKER_01: more detail. 01:03:10.500 --> 01:03:14.940 SPEAKER_01: So resource planning completed what we call an effective load carrying capability, ELCC 01:03:14.940 --> 01:03:16.139 SPEAKER_01: assessment. 01:03:16.139 --> 01:03:21.219 SPEAKER_01: And what it did is it assessed our PowerDirect's contribution to SMUD's resource adequacy. 01:03:21.219 --> 01:03:25.619 SPEAKER_01: It took into consideration our actual program performance, the availability of the resource, 01:03:25.619 --> 01:03:28.219 SPEAKER_01: and alignment with net load conditions. 01:03:28.219 --> 01:03:32.779 SPEAKER_01: But because we're seeing substantial new utility scale solar and wind resources coming online 01:03:32.779 --> 01:03:37.420 SPEAKER_01: this year, our highest risk hours shifted later into the evening. 01:03:37.420 --> 01:03:40.819 SPEAKER_01: So as a result, the PowerDirect capacity value declined. 01:03:40.820 --> 01:03:46.860 SPEAKER_01: It used to be about 56% in 2025 and it went down to 7% in 2026. 01:03:46.860 --> 01:03:50.900 SPEAKER_01: So it really spoke to needing to tweak what are event hours in order to maximize that 01:03:50.900 --> 01:03:52.420 SPEAKER_01: value. 01:03:52.420 --> 01:03:56.539 SPEAKER_01: To better align that emerging system need, the program team extended the PowerDirect event 01:03:56.539 --> 01:03:58.539 SPEAKER_01: window from 3 to 7 to 3 to 9. 01:03:58.539 --> 01:04:02.340 SPEAKER_01: And so that was where some of those commercial customers really couldn't be able to shift 01:04:02.340 --> 01:04:05.400 SPEAKER_01: in some of those later hours that we extended it to. 01:04:05.400 --> 01:04:10.400 SPEAKER_01: It did result in reduced customer participation and lower enrolled megawatts. 01:04:10.400 --> 01:04:15.440 SPEAKER_01: But one of the things that we are doing, well, as a result, though, the megawatts that do 01:04:15.440 --> 01:04:21.119 SPEAKER_01: remain enrolled provide that higher system value to SMUD and it aligns with SMUD's net 01:04:21.119 --> 01:04:23.160 SPEAKER_01: peak risk period. 01:04:23.160 --> 01:04:27.160 SPEAKER_01: The other thing that the team is doing is actually working on a redesign of the PowerDirect 01:04:27.160 --> 01:04:28.160 SPEAKER_01: program. 01:04:28.160 --> 01:04:33.539 Unknown: And we want to improve its flexibility and at the same time customer experience and scalability. 01:04:33.539 --> 01:04:37.340 SPEAKER_01: So as mentioned, traditionally our programs say you have to reduce or you have to shift 01:04:37.340 --> 01:04:40.820 SPEAKER_01: your load for this full entire event hours. 01:04:40.820 --> 01:04:44.599 SPEAKER_01: So the redesign structure we're looking at is going to allow customers to select participation 01:04:44.599 --> 01:04:46.400 SPEAKER_01: durations that fit their operations. 01:04:46.400 --> 01:04:49.139 SPEAKER_01: So ranging from one hour to five hour commitments. 01:04:49.139 --> 01:04:53.519 SPEAKER_01: And then we're going to scale the incentives to better align to their levels of participation. 01:04:53.519 --> 01:04:57.380 SPEAKER_01: So it improves to better align with their business operations and also better helps 01:04:57.380 --> 01:05:00.320 SPEAKER_01: us from a cost effectiveness resource standpoint. 01:05:00.320 --> 01:05:02.960 SPEAKER_01: We're wrapping up contract negotiations for our commercial VPP offerings. 01:05:02.960 --> 01:05:06.519 SPEAKER_01: So I know we've talked to you about that, which is that pilot that is targeting select 01:05:06.519 --> 01:05:11.600 SPEAKER_01: commercial and industrial customers behind substations that we have a future to be overloaded 01:05:11.600 --> 01:05:17.400 SPEAKER_01: to enhance grid reliability, provide avoidance capacity from an RA avoidance capacity as 01:05:17.400 --> 01:05:22.080 SPEAKER_01: well as have that potential to defer those substation upgrades. 01:05:22.080 --> 01:05:25.880 SPEAKER_01: The program offers both an upfront and ongoing incentives to accelerate that battery storage 01:05:25.880 --> 01:05:30.720 SPEAKER_01: adoption and encouraging our commercial and industrial customers to host and operate storage 01:05:30.720 --> 01:05:32.760 SPEAKER_01: assets for grid services. 01:05:32.760 --> 01:05:35.039 SPEAKER_01: Those contract negotiations are wrapping up. 01:05:35.039 --> 01:05:42.440 SPEAKER_01: We're hoping to launch by the end of the year and then have those installations come be 01:05:42.440 --> 01:05:44.660 SPEAKER_01: realized in 2027. 01:05:44.660 --> 01:05:49.200 SPEAKER_01: We are wrapping up evaluations for our multi-DER vendor selection. 01:05:49.200 --> 01:05:55.780 SPEAKER_01: That's our combined thermostat, residential battery energy storage and EV managed charging. 01:05:55.780 --> 01:05:59.700 SPEAKER_01: So we're hoping to have a new vendor online next year. 01:05:59.700 --> 01:06:04.100 SPEAKER_01: You will recall that while we have opened up our battery storage program to multiple 01:06:04.100 --> 01:06:09.480 SPEAKER_01: OEMs, that currently Tesla is the only one that we can control. 01:06:09.480 --> 01:06:13.580 SPEAKER_01: But the intent would be with this new vendor we can control all the battery storage with 01:06:13.580 --> 01:06:15.960 SPEAKER_01: the different manufacturers. 01:06:15.960 --> 01:06:19.500 SPEAKER_01: And then finally we're exploring some residential front of the meter battery storage models 01:06:19.500 --> 01:06:23.380 SPEAKER_01: to pilot where maybe concentrated battery storage deployment could deliver localized 01:06:23.380 --> 01:06:25.540 SPEAKER_01: value. 01:06:25.539 --> 01:06:27.500 SPEAKER_01: Next slide. 01:06:27.500 --> 01:06:29.820 SPEAKER_01: So some highlights for load flex. 01:06:29.820 --> 01:06:35.259 SPEAKER_01: The photos on the right showcase the marketing for our My Energy Optimizer partner program. 01:06:35.259 --> 01:06:36.980 SPEAKER_01: So that's our smart thermostats program. 01:06:36.980 --> 01:06:39.539 SPEAKER_01: The first two on the top. 01:06:39.539 --> 01:06:43.539 SPEAKER_01: And then the bottom one is our web page with information on our partner plus program for 01:06:43.539 --> 01:06:48.940 SPEAKER_01: the residential battery energy storage before we've announced the battery storage incentive 01:06:48.940 --> 01:06:50.460 SPEAKER_01: decrease. 01:06:50.460 --> 01:06:53.099 SPEAKER_01: Both of those programs are exceeding our goals this year. 01:06:53.099 --> 01:06:58.019 SPEAKER_01: So marketing did a digital Amazon ad campaign on the left. 01:06:58.019 --> 01:07:01.619 SPEAKER_01: And then they also provided an end of season performance impact message for the thermostat 01:07:01.619 --> 01:07:02.779 SPEAKER_01: program that you can see here. 01:07:02.779 --> 01:07:03.819 SPEAKER_01: Which is kind of cute, right? 01:07:03.819 --> 01:07:09.259 SPEAKER_01: That shows how much those thermostats really did in terms of equivalent hair dryers of 01:07:09.259 --> 01:07:11.219 SPEAKER_01: how much energy that they were able to shift. 01:07:11.219 --> 01:07:13.460 SPEAKER_01: Which is pretty significant. 01:07:13.460 --> 01:07:17.019 SPEAKER_01: As I mentioned we are decreasing the storage incentive and we have updated our web page 01:07:17.019 --> 01:07:21.980 SPEAKER_01: to include that information effective September 23rd. 01:07:21.980 --> 01:07:25.940 SPEAKER_01: On the left our Power Direct program which is our commercial load flexibility program 01:07:25.940 --> 01:07:31.260 SPEAKER_01: that I mentioned that we've changed the hours and are working to redesign the program actually 01:07:31.260 --> 01:07:33.980 SPEAKER_01: enrolled two new notable customers this year. 01:07:33.980 --> 01:07:38.300 SPEAKER_01: The bottom left picture is actually a picture that we also had last year because we featured 01:07:38.300 --> 01:07:40.619 SPEAKER_01: them because they went all electric. 01:07:40.619 --> 01:07:42.059 SPEAKER_01: And they put in EV charging. 01:07:42.059 --> 01:07:46.300 SPEAKER_01: It's core the new hub for health wellness and connection in Elk Grove which opened in 01:07:46.300 --> 01:07:47.800 SPEAKER_01: July of 2025. 01:07:47.800 --> 01:07:51.059 SPEAKER_01: It's owned and operated by the Consumna's Community Services District. 01:07:51.059 --> 01:07:56.519 SPEAKER_01: It's a 59,000 square foot all electric two story facility addressing a critical community 01:07:56.519 --> 01:08:01.619 SPEAKER_01: need by providing year round access to court sports, fitness and flexible programming for 01:08:01.619 --> 01:08:03.019 SPEAKER_01: all ages and abilities. 01:08:03.019 --> 01:08:07.539 SPEAKER_01: They did participate in the first Power Direct event this August and contributed an average 01:08:07.539 --> 01:08:12.019 SPEAKER_01: of 50 kilowatts of load shade capacity back to the grid. 01:08:12.019 --> 01:08:14.539 SPEAKER_01: On the top you've got Home Depot. 01:08:14.539 --> 01:08:19.500 SPEAKER_01: Actually 11 the 11 Sacramento Home Depot stores within our service territory enrolled in the 01:08:19.500 --> 01:08:24.279 SPEAKER_01: Power Direct program through a company called Voltus that's an external aggregator that 01:08:24.279 --> 01:08:27.340 SPEAKER_01: recruits customers into load flexibility programs. 01:08:27.340 --> 01:08:32.039 SPEAKER_01: And the 11 stores participated in the first Power Direct event this past August contributing 01:08:32.039 --> 01:08:35.720 SPEAKER_01: an average of 960 kilowatts of load shade back to the grid. 01:08:35.720 --> 01:08:40.319 SPEAKER_01: So really seeing some great performance by some of our new customers. 01:08:40.319 --> 01:08:41.420 SPEAKER_01: Okay next slide. 01:08:41.420 --> 01:08:42.420 SPEAKER_01: Green pricing. 01:08:42.420 --> 01:08:43.420 SPEAKER_01: Yes. 01:08:43.779 --> 01:08:50.819 Unknown: I guess one of the key takeaways is the tremendous success of our home batteries program and 01:08:50.819 --> 01:08:53.119 SPEAKER_05: building a virtual power plant. 01:08:53.119 --> 01:08:56.460 SPEAKER_05: You talked about it a little bit but it sort of makes it clear right. 01:08:56.460 --> 01:09:02.060 SPEAKER_05: In terms of the work we're doing how to dispatch that and really put it to the use of the greater 01:09:02.060 --> 01:09:03.060 SPEAKER_05: good. 01:09:03.060 --> 01:09:04.060 SPEAKER_05: Is that what you were talking about? 01:09:04.060 --> 01:09:05.060 SPEAKER_05: That's part of what we're doing in 2027. 01:09:05.060 --> 01:09:07.220 SPEAKER_05: Is there already work going on though? 01:09:07.220 --> 01:09:08.220 Unknown: Yeah. 01:09:08.220 --> 01:09:12.739 SPEAKER_01: So I talked a little bit about what we're doing to kind of shift our programs and really what 01:09:12.739 --> 01:09:16.340 SPEAKER_01: it speaks to and we'll talk more about it in the IDRP analysis. 01:09:16.340 --> 01:09:21.099 SPEAKER_01: But from a financial model standpoint when we've designed a lot of our load flexibility 01:09:21.099 --> 01:09:23.920 SPEAKER_01: programs they've been on the bulk system value right. 01:09:23.920 --> 01:09:26.179 SPEAKER_01: So from an RA capacity standpoint. 01:09:26.179 --> 01:09:32.579 SPEAKER_01: But what we're seeing is as the resource mix changes that value can potentially go down. 01:09:32.579 --> 01:09:37.939 SPEAKER_01: And so as such to really justify the incentives to get customers to participate or those ongoing 01:09:37.939 --> 01:09:40.979 SPEAKER_01: capacity payments we need to find additional value streams. 01:09:40.979 --> 01:09:46.259 SPEAKER_01: So maybe even back in the zero carbon plan for a long time we've talked about load flexibility 01:09:46.259 --> 01:09:48.939 SPEAKER_01: and the concept of stacking value streams. 01:09:48.939 --> 01:09:53.219 SPEAKER_01: Well really what we're starting to see is that we're needing to, we've been doing pilots 01:09:53.219 --> 01:09:57.319 SPEAKER_01: and we've been doing a lot of analysis is like how do we start seeing the realization 01:09:57.319 --> 01:09:59.659 SPEAKER_01: of those additional value streams. 01:09:59.659 --> 01:10:03.859 SPEAKER_01: Especially when potentially the foundational value stream is evolving as well. 01:10:03.859 --> 01:10:08.659 SPEAKER_01: Because we need to make sure that we maintain that value because that's how we pass on those 01:10:08.659 --> 01:10:10.179 SPEAKER_01: incentives to our customers. 01:10:10.180 --> 01:10:15.300 SPEAKER_01: So we're already doing it today and how we're evolving the power direct program for example. 01:10:15.300 --> 01:10:20.780 SPEAKER_01: But it's the same thing with battery storage and why we're looking at like with the commercial 01:10:20.780 --> 01:10:25.380 SPEAKER_01: VPP or potentially even front of the meter residential batteries is this is where like 01:10:25.380 --> 01:10:28.420 SPEAKER_01: where is that localized distribution grid value. 01:10:28.420 --> 01:10:33.579 SPEAKER_01: We call them non-mariles alternatives or be able to sort of defer some grid investments. 01:10:33.579 --> 01:10:38.720 SPEAKER_01: Sometimes the financial model needs that value stream to make it pencil to be in the black. 01:10:38.720 --> 01:10:40.760 SPEAKER_01: That that bulk system value is not enough. 01:10:40.760 --> 01:10:44.920 SPEAKER_01: And so those are the things that we're really doing to evolve our load flexibility programs. 01:10:44.920 --> 01:10:46.360 Unknown: That's great. 01:10:46.360 --> 01:10:53.760 SPEAKER_05: Another thing I know we've known for a minute maybe a yearish now that sodium ion batteries 01:10:53.760 --> 01:11:01.720 SPEAKER_05: are coming and are potentially two to four times cheaper than the medium run than the 01:11:01.720 --> 01:11:03.560 SPEAKER_05: lithium iron phosphate technology. 01:11:03.560 --> 01:11:08.560 SPEAKER_05: And so I guess I would just say like let's make sure we're keeping a close eye on cost 01:11:08.560 --> 01:11:15.720 SPEAKER_05: of equipment and making sure that we're balancing our incentive levels to match the actual cost 01:11:15.720 --> 01:11:17.800 SPEAKER_05: make sure we're not inflating. 01:11:17.800 --> 01:11:21.400 SPEAKER_05: We're not overly inflating costs. 01:11:21.400 --> 01:11:24.160 SPEAKER_05: So something in my mind. 01:11:24.160 --> 01:11:28.480 SPEAKER_01: It's definitely early but that's a problem for probably your one to three years away. 01:11:28.480 --> 01:11:32.600 SPEAKER_05: Yeah you know it's it's important whether it's technology or just sort of the pricing 01:11:32.600 --> 01:11:36.680 SPEAKER_01: like we would have said or actually we do say like if you look at international costs 01:11:36.680 --> 01:11:41.160 SPEAKER_01: from a battery cell standpoint you know especially in the EV space it's like okay it's price 01:11:41.160 --> 01:11:47.160 SPEAKER_01: parity to internal combustion engines but you know because they're manufactured overseas 01:11:47.160 --> 01:11:49.880 SPEAKER_01: and things like that between terrorists and things like that it's just not the same the 01:11:49.880 --> 01:11:52.760 SPEAKER_01: cost haven't come down for us to install them in the U.S. 01:11:52.760 --> 01:11:57.600 SPEAKER_01: So those are those considerations that we watch very closely because with some of those 01:11:57.600 --> 01:12:02.600 SPEAKER_01: changes once some of those things unlock the fact that some technologies already exist 01:12:02.600 --> 01:12:08.120 SPEAKER_01: that are much less expensive that can unlock huge opportunities. 01:12:08.120 --> 01:12:09.120 SPEAKER_01: Very good point. 01:12:09.120 --> 01:12:10.720 SPEAKER_01: Okay next slide. 01:12:10.720 --> 01:12:12.760 SPEAKER_01: Last portfolio green pricing. 01:12:12.760 --> 01:12:15.880 SPEAKER_01: So last but not least is our green pricing portfolio. 01:12:15.880 --> 01:12:20.039 SPEAKER_01: It provides our customers the opportunity to utilize and support renewable and carbon-free 01:12:20.039 --> 01:12:24.360 SPEAKER_01: energy beyond our standard electricity mix and it's designed to increase our customers 01:12:24.359 --> 01:12:29.599 SPEAKER_01: access to solar and renewable energy at reasonable cost to our customers. 01:12:29.599 --> 01:12:31.559 SPEAKER_01: Next slide. 01:12:31.559 --> 01:12:35.759 SPEAKER_01: So same theme as you can see from the charts the team has forecasted to come in very very 01:12:35.759 --> 01:12:40.839 SPEAKER_01: close but slightly short of the goal for the year at 830 gigawatt hours sold versus the 01:12:40.839 --> 01:12:43.960 SPEAKER_01: goal of 870 gigawatt hours. 01:12:43.960 --> 01:12:47.399 SPEAKER_01: You know I think I mentioned it last year but we lost the mid-tier product at the end 01:12:47.399 --> 01:12:51.799 SPEAKER_01: of last year that was that $8 per month option because we've been seeing that renewable costs 01:12:51.800 --> 01:12:56.600 SPEAKER_01: are increasing coupled with the loss of the web-enabled sales channel for new electric 01:12:56.600 --> 01:12:59.360 SPEAKER_01: service starts in that transition to SEW. 01:12:59.360 --> 01:13:03.560 SPEAKER_01: So we're lagging a bit on our zero carbon plan trajectory given the challenge to catch 01:13:03.560 --> 01:13:04.560 SPEAKER_01: up. 01:13:04.560 --> 01:13:08.720 SPEAKER_01: That being said there's still stuff to celebrate and we have seen increases in participation 01:13:08.720 --> 01:13:09.720 SPEAKER_01: in certain areas. 01:13:09.720 --> 01:13:12.159 SPEAKER_01: So next slide. 01:13:12.159 --> 01:13:16.119 SPEAKER_01: So we are coming in really really close to our goals for green energy and that's actually 01:13:16.119 --> 01:13:22.079 SPEAKER_01: really significant thanks to a number of organizations. 01:13:22.079 --> 01:13:26.119 SPEAKER_01: The contact center stepped up to increase enrollments through that channel given the 01:13:26.119 --> 01:13:29.899 SPEAKER_01: loss of the web-based sales channel for new electric service. 01:13:29.899 --> 01:13:35.239 SPEAKER_01: They increased enrollments by 51% year over year which was a huge jump. 01:13:35.239 --> 01:13:38.960 SPEAKER_01: We are also appreciative of marketing and communications engagement teams who explored 01:13:38.960 --> 01:13:43.680 SPEAKER_01: new marketing channels including outreach at local community events to support customer 01:13:43.680 --> 01:13:45.840 SPEAKER_01: adoption in light of that loss of that web channel. 01:13:45.840 --> 01:13:48.239 SPEAKER_01: So thank you thank you thank you. 01:13:48.239 --> 01:13:50.480 SPEAKER_01: Something else to celebrate would you believe it? 01:13:50.480 --> 01:13:55.800 SPEAKER_01: Greenergy is celebrating 30 years of national leadership in the voluntary green pricing 01:13:55.800 --> 01:13:57.239 SPEAKER_01: space in the upcoming year. 01:13:57.239 --> 01:14:02.920 SPEAKER_01: It's been 30 years so definitely something to celebrate given all that it's done for 01:14:02.920 --> 01:14:06.800 SPEAKER_01: our community and for our customers and in the industry. 01:14:06.800 --> 01:14:10.680 SPEAKER_01: We did significantly increase residential solar shares participation this year and we've 01:14:10.680 --> 01:14:14.520 SPEAKER_01: actually added five more megawatts of solar supply to allow for additional customers to 01:14:14.520 --> 01:14:18.920 SPEAKER_01: participate because we're getting ready to run out of solar resources. 01:14:18.920 --> 01:14:22.600 SPEAKER_01: That being said you know we are watching the price for solar energy closely. 01:14:22.600 --> 01:14:26.640 SPEAKER_01: I think you've heard from Brian Swan and others that the resource PPA costs are going up for 01:14:26.640 --> 01:14:32.840 SPEAKER_01: solar PPAs and so we're managing participation and adding capacity in a cautious way to ensure 01:14:32.840 --> 01:14:37.120 SPEAKER_01: that our solar supply matches up with that financial equation that sets accessible pricing 01:14:37.120 --> 01:14:41.360 SPEAKER_01: for our customers because make like you know reminder residential solar shares we really 01:14:41.360 --> 01:14:43.640 SPEAKER_01: target to our low and moderate income customers. 01:14:43.640 --> 01:14:47.960 SPEAKER_01: So we want to make sure that that financial equation works so we're managing enrollments 01:14:47.960 --> 01:14:48.960 SPEAKER_01: from that standpoint. 01:14:48.960 --> 01:14:49.960 SPEAKER_01: Rachel? 01:14:49.960 --> 01:14:50.960 SPEAKER_01: Yes. 01:14:50.960 --> 01:15:03.760 Unknown: I'm not sure if we still have this program or if it's solar shares but when someone wants 01:15:03.760 --> 01:15:12.239 SPEAKER_00: to have solar but you know the roof is shaded they can't cut the trees or they live in a 01:15:12.239 --> 01:15:15.360 SPEAKER_00: rental. 01:15:15.360 --> 01:15:18.159 SPEAKER_00: Is there a program for them to have solar? 01:15:18.159 --> 01:15:19.159 Unknown: Yes. 01:15:19.159 --> 01:15:21.440 SPEAKER_01: So residential solar shares is the program. 01:15:21.440 --> 01:15:25.020 SPEAKER_01: We don't limit who can participate in residential solar shares. 01:15:25.020 --> 01:15:29.159 SPEAKER_01: We do a lot of targeted marketing to low and moderate income customers for residential 01:15:29.159 --> 01:15:33.480 SPEAKER_01: solar shares because often it's a challenge for them to be able to participate so we want 01:15:33.479 --> 01:15:37.639 SPEAKER_01: to make sure that they are aware and have the ability to participate so we do see a 01:15:37.639 --> 01:15:42.000 SPEAKER_01: large percentage of our residential solar shares customers participating that are low 01:15:42.000 --> 01:15:45.439 SPEAKER_01: and moderate income but it is not limited to like we don't turn people away and say 01:15:45.439 --> 01:15:49.500 SPEAKER_01: no you have to meet certain income qualifications in order to participate in residential solar 01:15:49.500 --> 01:15:50.500 SPEAKER_01: shares. 01:15:50.500 --> 01:15:58.679 SPEAKER_00: And have we capped solar shares because the person I was talking to said that she was 01:15:58.679 --> 01:16:02.919 SPEAKER_00: told that there's it's not available anymore to her. 01:16:02.920 --> 01:16:06.159 SPEAKER_01: I wonder if that might be neighborhood solar shares. 01:16:06.159 --> 01:16:10.039 SPEAKER_01: Were they trying to build an ADU or something like that? 01:16:10.039 --> 01:16:16.880 SPEAKER_00: They just wanted to get solar for their home but they couldn't have it up on the roof. 01:16:16.880 --> 01:16:17.880 SPEAKER_01: Okay. 01:16:17.880 --> 01:16:21.760 SPEAKER_01: So one thing that is closed is neighborhood solar shares. 01:16:21.760 --> 01:16:26.619 SPEAKER_01: So neighborhood solar shares is the program that was approved by the California Energy 01:16:26.619 --> 01:16:32.399 SPEAKER_01: Commission as like I think the only program that enabled builders to utilize neighborhood 01:16:32.399 --> 01:16:36.399 SPEAKER_01: solar shares instead of installing solar on their rooftop. 01:16:36.399 --> 01:16:42.559 SPEAKER_01: Now Title 24 has continued to evolve and the building standards have evolved so we actually 01:16:42.559 --> 01:16:49.639 SPEAKER_01: sunset neighborhood solar shares but what we did is we introduced well we launched a 01:16:49.639 --> 01:16:51.960 SPEAKER_01: program called multi-tenant solar. 01:16:51.960 --> 01:16:57.199 SPEAKER_01: And really what multi-tenant solar is if you remember what virtual solar is was it allows 01:16:57.199 --> 01:17:03.519 SPEAKER_01: a developer to put on solar and then utilize it to support multiple tenants. 01:17:03.519 --> 01:17:08.300 SPEAKER_01: And so we used to only limit it to low income developments, low income multi-family so that 01:17:08.300 --> 01:17:09.300 SPEAKER_01: was virtual solar. 01:17:09.300 --> 01:17:12.939 SPEAKER_01: But now we've converted to multi-tenant solar. 01:17:12.939 --> 01:17:17.359 SPEAKER_01: So we still have the low income option that has a little bit of a boost but then we also 01:17:17.359 --> 01:17:20.399 SPEAKER_01: have a market rate option for that. 01:17:20.399 --> 01:17:25.659 SPEAKER_01: And then for customers that have ADUs that had a lot of them have been taking advantage 01:17:25.659 --> 01:17:30.619 SPEAKER_01: of neighborhood solar shares I think the building code had evolved a bit so that they 01:17:30.619 --> 01:17:32.739 SPEAKER_01: had some options. 01:17:32.739 --> 01:17:36.939 SPEAKER_01: So that might be it but if not happy to follow up and dig in a little bit deeper to understand 01:17:36.939 --> 01:17:37.939 SPEAKER_01: what's going on. 01:17:37.939 --> 01:17:38.939 Unknown: Thank you. 01:17:38.939 --> 01:17:39.939 Unknown: Okay. 01:17:39.939 --> 01:17:41.939 Unknown: Oh, was there a question? 01:17:41.939 --> 01:17:52.699 SPEAKER_01: The Energy Commission changed the code so it basically doesn't, you can't qualify. 01:17:52.699 --> 01:17:55.899 SPEAKER_05: I don't know exactly what the current code says but there's no current program. 01:17:55.899 --> 01:17:56.899 SPEAKER_05: Right. 01:17:56.899 --> 01:17:57.899 SPEAKER_05: And there's nothing on the horizon. 01:17:57.899 --> 01:18:00.779 SPEAKER_01: Yeah, we were the only program at the time with the code and then after they changed 01:18:00.779 --> 01:18:02.899 SPEAKER_01: the code we chose not to continue giving them all the cases. 01:18:02.899 --> 01:18:03.899 SPEAKER_01: And I wouldn't testify. 01:18:03.899 --> 01:18:10.260 SPEAKER_01: We've been able to have that get into place. 01:18:10.260 --> 01:18:18.340 SPEAKER_05: So one general thought is again there's so many solar share neighborhood commercial 01:18:18.340 --> 01:18:21.220 SPEAKER_05: residential and then green energy programs. 01:18:21.220 --> 01:18:26.020 SPEAKER_05: I would think Steph might consider trying to rebrand these a little bit into clear names 01:18:26.020 --> 01:18:32.860 SPEAKER_05: or categories just at the highest level comment because we see this every year and it gets 01:18:32.860 --> 01:18:33.860 SPEAKER_05: confusing. 01:18:33.860 --> 01:18:34.860 SPEAKER_05: Yes. 01:18:34.860 --> 01:18:40.980 SPEAKER_05: And the actual question and all that commentary is is it the residential solar shares the 01:18:40.980 --> 01:18:47.539 SPEAKER_05: currently open program where you try to remember will you pay a little bit more for the first 01:18:47.539 --> 01:18:51.420 SPEAKER_05: like I don't know four or five years and then we give you a discount for like the next 01:18:51.420 --> 01:18:52.500 SPEAKER_05: ten years or something like that. 01:18:52.500 --> 01:19:04.699 SPEAKER_05: The residential solar shares program is where you pay in but I think you get savings from 01:19:04.699 --> 01:19:06.279 SPEAKER_01: in that first year. 01:19:06.279 --> 01:19:10.380 SPEAKER_01: So it's not like commercial solar shares where you paid higher for a while and then there's 01:19:10.380 --> 01:19:11.619 SPEAKER_01: a crossover point. 01:19:11.619 --> 01:19:12.619 Unknown: Okay. 01:19:12.619 --> 01:19:13.619 SPEAKER_05: Which commercial shares. 01:19:13.619 --> 01:19:14.619 SPEAKER_01: I'm going to google it. 01:19:14.699 --> 01:19:19.659 SPEAKER_05: It's my dot org and it's residential solar shares and it has years one through ten and 01:19:19.659 --> 01:19:21.260 SPEAKER_04: eleven through twenty but you are correct. 01:19:21.260 --> 01:19:23.939 SPEAKER_04: The charges start the first year. 01:19:23.939 --> 01:19:28.859 SPEAKER_04: So for the listening public we have a whole website that shows pricing and terms and shows 01:19:28.859 --> 01:19:35.099 SPEAKER_04: you each year the bill credits and splits it up first ten years and the second twenty. 01:19:35.099 --> 01:19:36.099 SPEAKER_04: Second set. 01:19:36.099 --> 01:19:37.099 SPEAKER_05: I was right. 01:19:37.099 --> 01:19:38.099 SPEAKER_05: It's year six. 01:19:38.099 --> 01:19:39.099 SPEAKER_05: It switches over. 01:19:39.099 --> 01:19:40.099 SPEAKER_04: Okay. 01:19:40.099 --> 01:19:41.099 Unknown: It switches over. 01:19:41.100 --> 01:19:47.460 SPEAKER_06: Rachel, to go along with the residential solar shares program I'm still waiting for 01:19:47.460 --> 01:19:51.579 SPEAKER_06: us to offer vanity solar which is putting fake solar panels on your roof so you can 01:19:51.579 --> 01:19:52.579 SPEAKER_06: brag to your friends. 01:19:52.579 --> 01:19:56.860 SPEAKER_06: But maybe that's for a different time. 01:19:56.860 --> 01:20:01.020 SPEAKER_01: Well we used to when I started solar shares what was that back in 2007 we gave you a little 01:20:01.020 --> 01:20:05.100 SPEAKER_01: window cling so you could put it on there and say hey I'm a member of solar shares. 01:20:05.100 --> 01:20:09.300 SPEAKER_06: Close enough and probably more practical. 01:20:09.300 --> 01:20:13.900 SPEAKER_01: Okay so looking ahead I did a board presentation a month ago so not going to go into details 01:20:13.900 --> 01:20:17.380 SPEAKER_01: but we're making progress in our demonstration projects for solar and storage for schools 01:20:17.380 --> 01:20:20.860 SPEAKER_01: so appreciate all of you approving the PPA for grant union. 01:20:20.860 --> 01:20:25.739 SPEAKER_01: Our climate advocate program is seeing opportunities to expand the projects that we fund to include 01:20:25.739 --> 01:20:29.940 SPEAKER_01: nature based solutions which are projects aimed to protect, restore, benefit ecosystems 01:20:29.940 --> 01:20:35.260 SPEAKER_01: by enhancing resilience, biodiversity and sustainability in our immediate environment. 01:20:35.260 --> 01:20:39.539 SPEAKER_01: So the green energy team is actually working or the climate advocate team is working with 01:20:39.539 --> 01:20:44.840 SPEAKER_01: Kathleen Ave on who is now part of the power gen team to develop project selection criteria 01:20:44.840 --> 01:20:48.380 SPEAKER_01: to identify projects that have particular value to SMUD, our customers and the Sacramento 01:20:48.380 --> 01:20:50.780 SPEAKER_01: region so we're actually really excited about that. 01:20:50.780 --> 01:20:55.980 SPEAKER_01: And then finally we're looking ahead in program design as well as our customers needs evolved. 01:20:55.980 --> 01:20:58.619 SPEAKER_01: We've heard from our commercial customers that they want to better understand how their 01:20:58.619 --> 01:21:02.940 SPEAKER_01: energy use lines up with renewable and carbon free generation so the staff have been working 01:21:02.939 --> 01:21:06.579 SPEAKER_01: on a tool that can show commercial customers with their sustainability goals, how their 01:21:06.579 --> 01:21:10.859 SPEAKER_01: electrical load matches up with resources and are developing a program designed to support 01:21:10.859 --> 01:21:14.619 SPEAKER_01: their evolving renewables needs. 01:21:14.619 --> 01:21:15.759 SPEAKER_01: Okay next slide. 01:21:15.759 --> 01:21:21.339 SPEAKER_01: So mentioning the climate advocate program the first project on the left is actually 01:21:21.339 --> 01:21:26.079 SPEAKER_01: the climate advocate team and you see Kathleen there that is one of the projects they're 01:21:26.079 --> 01:21:29.859 SPEAKER_01: looking to explore for the climate advocate program that's a nature based solution. 01:21:29.859 --> 01:21:35.339 SPEAKER_01: This picture is the team at Lundberg family farms so you may enjoy their rice. 01:21:35.339 --> 01:21:40.099 SPEAKER_01: The project involves rebuilding and rewetting the peat moss soil at Bacon Island by transitioning 01:21:40.099 --> 01:21:44.099 SPEAKER_01: the crops from traditional alpha and corn to organic rice. 01:21:44.099 --> 01:21:48.460 SPEAKER_01: We've identified that the attributes which are up to 100,000 metric tons of carbon reduced 01:21:48.460 --> 01:21:52.939 SPEAKER_01: annually that are attractive so it could be our very first opportunity to support our 01:21:52.939 --> 01:21:59.359 SPEAKER_01: nature based solution which is a growing motivator for environmentally focused people and organizations. 01:21:59.380 --> 01:22:04.299 SPEAKER_01: The middle project is the country acres project which is a 344 megawatt system and the largest 01:22:04.299 --> 01:22:05.619 SPEAKER_01: of its kind in our area. 01:22:05.619 --> 01:22:08.839 SPEAKER_01: Some of the power from this project will be used to support some of our green pricing 01:22:08.839 --> 01:22:09.839 SPEAKER_01: programs. 01:22:09.839 --> 01:22:13.219 SPEAKER_01: And the last picture is a marketing piece that was launched around Earth Day. 01:22:13.219 --> 01:22:17.979 SPEAKER_01: It was publicizing the efforts of our green energy program over the years as well as recognizing 01:22:17.979 --> 01:22:23.259 SPEAKER_01: our commercial customers who are making a difference through their green energy participation. 01:22:23.259 --> 01:22:24.259 SPEAKER_01: Next slide. 01:22:24.259 --> 01:22:25.259 Unknown: Okay. 01:22:25.259 --> 01:22:26.619 Unknown: Coming in the home stretch. 01:22:26.640 --> 01:22:30.779 SPEAKER_01: So as we do every year, I wanted to share where we are in both applications and installations 01:22:30.779 --> 01:22:32.939 SPEAKER_01: for customer behind the meter solar. 01:22:32.939 --> 01:22:37.220 SPEAKER_01: As you can see from this slide, overall year to year we still see increases in both applications 01:22:37.220 --> 01:22:42.500 SPEAKER_01: and installations when combining residential commercial solar from 2025 to 26. 01:22:42.500 --> 01:22:46.140 SPEAKER_01: This is looking at January through August 23rd of each year. 01:22:46.140 --> 01:22:50.680 SPEAKER_01: We still see that a significant part of this growth is due to new construction. 01:22:50.680 --> 01:22:56.159 SPEAKER_01: During the January to August 23rd time period we've added approximately 18.4 megawatts of 01:22:56.159 --> 01:22:59.340 SPEAKER_01: solar, the vast majority of that being residential. 01:22:59.340 --> 01:23:05.139 SPEAKER_01: And as of the end of Q2 2026, over 67,000 customers have installed rooftop solar totaling 01:23:05.139 --> 01:23:09.099 SPEAKER_01: nearly 435 megawatts. 01:23:09.099 --> 01:23:12.859 SPEAKER_01: And then I didn't, it's not necessarily a purpose of this slide, but I did want to take 01:23:12.859 --> 01:23:16.420 SPEAKER_01: a couple minutes just to mention balcony solar because I know the question came up. 01:23:16.420 --> 01:23:19.099 SPEAKER_01: I think it was last week. 01:23:19.099 --> 01:23:24.019 SPEAKER_01: And SB 868 was recently passed by the California legislature and is awaiting the governor's 01:23:24.019 --> 01:23:25.019 SPEAKER_01: signature. 01:23:25.040 --> 01:23:29.440 SPEAKER_01: That legislation exempts portable solar generation devices from all interconnection requirements. 01:23:29.440 --> 01:23:32.840 SPEAKER_01: I know Laura answered a question about it last week, but I wanted to add a little bit 01:23:32.840 --> 01:23:34.360 SPEAKER_01: more detail. 01:23:34.360 --> 01:23:38.840 SPEAKER_01: We do recognize that plug-in solar can be a meaningful option for customers, but as 01:23:38.840 --> 01:23:43.440 SPEAKER_01: Laura mentioned and reinforced is that current U.S. standards and codes are actually not 01:23:43.440 --> 01:23:48.600 SPEAKER_01: fully ready for deployment as both EPRI and the underwriters labs have both identified 01:23:48.600 --> 01:23:53.400 SPEAKER_01: gaps in the national electric code because the NEC assumes generation is permanent, hired, 01:23:53.579 --> 01:23:58.179 SPEAKER_01: and connected to the house's electric panel rather than the electrical outlet. 01:23:58.179 --> 01:24:02.619 SPEAKER_01: So SMUD is supporting standards development and customer education while maintaining a 01:24:02.619 --> 01:24:06.219 SPEAKER_01: clear focus on safety, code compliance, and operational visibility. 01:24:06.219 --> 01:24:08.379 SPEAKER_01: So SMUD is participating. 01:24:08.379 --> 01:24:14.899 SPEAKER_01: EPRI actually has an effort on plug-in PIVV where we're going to benefit from their efforts 01:24:14.899 --> 01:24:19.299 SPEAKER_01: from lab testing to inform the development of internal processes as well as educational 01:24:19.299 --> 01:24:20.299 SPEAKER_01: materials for our customers. 01:24:20.300 --> 01:24:25.119 SPEAKER_01: So happy to provide additional details as they come out, but just wanted to make sure 01:24:25.119 --> 01:24:28.000 SPEAKER_01: I addressed that given a number of questions that have come up. 01:24:28.000 --> 01:24:31.159 SPEAKER_00: Well, I just want to say thank you. 01:24:31.159 --> 01:24:36.320 SPEAKER_00: I know I have beaten up our general manager about where's that memo? 01:24:36.320 --> 01:24:43.000 SPEAKER_00: I want to see what's going on because I keep, you know, I keep running into people who have, 01:24:43.000 --> 01:24:47.039 SPEAKER_00: they're all excited about the solar balcony thing. 01:24:47.039 --> 01:24:49.119 SPEAKER_00: And so here's a question for you. 01:24:49.800 --> 01:24:54.800 SPEAKER_00: The governor has a bill on his desk to allow for it. 01:24:55.760 --> 01:25:02.760 SPEAKER_00: Why would the governor sign a bill that would allow for solar that isn't safe for someone's home? 01:25:07.800 --> 01:25:12.680 SPEAKER_01: You know, and I can't contemplate what the governor will choose to do. 01:25:12.680 --> 01:25:17.119 SPEAKER_01: I will just say that I think it's important for us as we think about these solutions. 01:25:17.119 --> 01:25:21.279 SPEAKER_01: Like I said, this is something that does provide an opportunity, but we want our customers 01:25:21.279 --> 01:25:23.800 SPEAKER_01: to be safe and we want our employees to be safe. 01:25:23.800 --> 01:25:26.559 SPEAKER_01: And so for that, those are those things that we are looking for. 01:25:26.559 --> 01:25:31.880 SPEAKER_01: I know there is a draft board memo, so we're getting close to finalizing it that has a 01:25:31.880 --> 01:25:36.880 SPEAKER_01: lot more details that will share additional information with the board. 01:25:36.880 --> 01:25:37.880 SPEAKER_00: Okay. 01:25:37.880 --> 01:25:42.159 SPEAKER_00: Well, you know, I will keep waiting for it. 01:25:42.159 --> 01:25:51.279 SPEAKER_00: But it bothers me that, you know, we have a piece of legislation that's going to the 01:25:51.279 --> 01:25:53.279 SPEAKER_00: governor's desk. 01:25:53.279 --> 01:26:06.279 SPEAKER_00: Even one of our board members, Heidi Sanborn, said last night that it does require UL certification. 01:26:07.079 --> 01:26:18.079 SPEAKER_00: You know, it's very awkward for all of us to say, yes, there's solar balcony, but no, don't plug it in. 01:26:18.079 --> 01:26:24.079 Unknown: And yet, you know, the legislature is saying that this is okay. 01:26:24.079 --> 01:26:28.399 SPEAKER_00: I mean, we need to figure out what's going on. 01:26:28.399 --> 01:26:31.800 SPEAKER_00: And maybe I'll know after I get that memo. 01:26:31.800 --> 01:26:37.039 SPEAKER_00: But this is an issue that is really important to me. 01:26:37.039 --> 01:26:48.880 SPEAKER_00: You know, it isn't good for SMUD to think of ourselves as a solar advocate and then, 01:26:48.880 --> 01:26:56.640 SPEAKER_00: you know, basically back away from something that's sweeping the state. 01:26:56.640 --> 01:26:59.720 SPEAKER_00: So we need to get on top of this. 01:26:59.720 --> 01:27:00.720 SPEAKER_00: Yeah. 01:27:00.720 --> 01:27:01.720 SPEAKER_01: So I would say we're backing away. 01:27:01.720 --> 01:27:05.960 SPEAKER_01: I think that's actually why we chose to participate in the EPRI efforts. 01:27:05.960 --> 01:27:10.560 SPEAKER_01: Because we want to really understand technically what needs to happen to make sure, like I 01:27:10.560 --> 01:27:13.199 SPEAKER_01: said, both our customers and our employees are safe. 01:27:13.199 --> 01:27:22.400 SPEAKER_01: So I just want to, like I said, we are already participating in that EPRI project to be able 01:27:22.400 --> 01:27:26.800 SPEAKER_01: and recognizing others are as well to be able to address these things. 01:27:27.800 --> 01:27:32.560 SPEAKER_03: Just a point of clarification as well, Laura Engway, CEO, General Manager, that the California 01:27:32.560 --> 01:27:38.000 SPEAKER_03: SB 868, which is what's awaiting the Governor's signature, is really around the exemption 01:27:38.000 --> 01:27:39.000 SPEAKER_03: of interconnection fees. 01:27:39.000 --> 01:27:43.840 SPEAKER_03: So it's really not speaking to the safety or the requirements of those devices. 01:27:43.840 --> 01:27:50.039 SPEAKER_03: It's really more around avoiding interconnection fees for those devices when they become available. 01:27:50.039 --> 01:27:54.079 Unknown: Thank you for that clarification. 01:27:54.079 --> 01:27:56.579 Unknown: Okay. 01:27:57.500 --> 01:27:59.500 SPEAKER_01: So next slide. 01:27:59.500 --> 01:28:02.619 SPEAKER_01: So in light of these challenges, how do we think about the path ahead? 01:28:02.619 --> 01:28:05.779 SPEAKER_01: You've heard me a lot say we are trying really hard. 01:28:05.779 --> 01:28:07.819 SPEAKER_01: We've got a lot of headwinds. 01:28:07.819 --> 01:28:09.979 SPEAKER_01: But we're not exactly hitting the goal. 01:28:09.979 --> 01:28:14.859 SPEAKER_01: So I've talked about the fact that the reality is we do need to rethink the goal trajectories. 01:28:14.859 --> 01:28:16.059 SPEAKER_01: It's not to say we don't grow. 01:28:16.059 --> 01:28:18.859 SPEAKER_01: And it's not to say that we don't continue to increase and encourage our customers to 01:28:18.859 --> 01:28:20.300 SPEAKER_01: drop these technologies. 01:28:20.300 --> 01:28:23.939 SPEAKER_01: But whether we're growing on that exponential curve that we had set back with the 2030 plan 01:28:24.019 --> 01:28:28.659 SPEAKER_01: is something that we need to discuss and talk about and prioritize as we think about our 01:28:28.659 --> 01:28:32.779 SPEAKER_01: investments, how to best serve our customers, help them with their affordability and energy 01:28:32.779 --> 01:28:38.699 SPEAKER_01: needs, as well as continue supporting sustainability. 01:28:38.699 --> 01:28:42.619 SPEAKER_01: This is consistent with what you've heard from the utility side as well. 01:28:42.619 --> 01:28:45.619 SPEAKER_01: I know Josh and Brian came and spoke in April. 01:28:45.619 --> 01:28:49.539 SPEAKER_01: And we faced headwinds from that standpoint that, frankly, we just didn't expect when 01:28:49.539 --> 01:28:51.259 SPEAKER_01: we minted the zero carbon plan. 01:28:51.260 --> 01:28:54.820 SPEAKER_01: So as we think about the path ahead, you know that we're going to be starting the integrated 01:28:54.820 --> 01:28:58.180 SPEAKER_01: resources plan effort next month. 01:28:58.180 --> 01:28:59.739 SPEAKER_01: And we'll have some consideration. 01:28:59.739 --> 01:29:03.739 SPEAKER_01: So I do want to share with you some of the thoughts I have as you consider as we go through 01:29:03.739 --> 01:29:09.180 SPEAKER_01: that process for those considerations to support our goals with sustainability, reliability 01:29:09.180 --> 01:29:10.180 SPEAKER_01: and affordability. 01:29:10.180 --> 01:29:11.900 SPEAKER_01: So next slide. 01:29:11.900 --> 01:29:15.500 SPEAKER_01: So this is where, and you've heard me say about how you can say from an electrification 01:29:15.500 --> 01:29:21.819 SPEAKER_01: standpoint, but as mentioned with the updated analysis, measurement verification, we need 01:29:21.819 --> 01:29:25.659 SPEAKER_01: to continue to think about the offerings based upon the portfolio. 01:29:25.659 --> 01:29:28.539 SPEAKER_01: And I have this what I call as the dollhouse view, right? 01:29:28.539 --> 01:29:30.100 SPEAKER_01: Customers adopt multiple technologies. 01:29:30.100 --> 01:29:33.939 SPEAKER_01: So we really need to think about the customer experience as they adopt these different technologies, 01:29:33.939 --> 01:29:37.979 SPEAKER_01: but also help our customers understand what are the things that can best meet their needs. 01:29:37.979 --> 01:29:41.939 SPEAKER_01: If they're looking for help with regards to managing energy costs, how do we share with 01:29:41.939 --> 01:29:44.779 SPEAKER_01: them what are those things that will have the most impact and think about what they 01:29:44.779 --> 01:29:46.219 SPEAKER_01: adopt when? 01:29:46.219 --> 01:29:52.819 SPEAKER_01: This shows the comparison, and this is today, of a mixed fuel home versus an all-electric 01:29:52.819 --> 01:29:53.819 SPEAKER_01: home. 01:29:53.819 --> 01:29:56.579 SPEAKER_01: So assuming a baseline of electricity, that's the same on both. 01:29:56.579 --> 01:29:59.619 SPEAKER_01: So you've got your air conditioning and your electric loads. 01:29:59.619 --> 01:30:02.939 SPEAKER_01: Gas appliances use over 1200. 01:30:02.939 --> 01:30:08.939 SPEAKER_01: Gas appliances, the gas to support your gas appliances is over $1200 a year. 01:30:08.939 --> 01:30:14.179 SPEAKER_01: If customers convert to electric appliances, so heat pump space heating, heat pump water 01:30:14.180 --> 01:30:19.820 SPEAKER_01: heating, induction cooking, customers can cut their energy costs from gas appliances 01:30:19.820 --> 01:30:21.140 SPEAKER_01: in half. 01:30:21.140 --> 01:30:26.500 SPEAKER_01: If they switch from gasoline for transportation to an EV, they can cut their energy costs 01:30:26.500 --> 01:30:31.860 SPEAKER_01: to almost one-third of what they're paying today, resulting in overall cutting an average 01:30:31.860 --> 01:30:40.900 SPEAKER_01: residential single-family homes energy wallet from $6846 a year to $3613 a year. 01:30:40.900 --> 01:30:41.900 SPEAKER_01: That is really significant. 01:30:41.899 --> 01:30:45.539 SPEAKER_01: When we talk about affordability, when we talk about the things that we can encourage 01:30:45.539 --> 01:30:52.059 SPEAKER_01: our customers to do, electrification is really significant in helping our customers find 01:30:52.059 --> 01:30:55.819 SPEAKER_01: ways to save on their energy bills. 01:30:55.819 --> 01:30:59.500 SPEAKER_01: From a carbon emission standpoint, building electrification reduces carbon emissions by 01:30:59.500 --> 01:31:04.979 SPEAKER_01: 1.4 metric tons per equivalent all-electric home and each EV by three metric tons. 01:31:04.979 --> 01:31:10.779 SPEAKER_01: So EVs really, as we talked about loading order and which one is the number one priority, 01:31:11.219 --> 01:31:15.539 SPEAKER_01: Dr. Ayala said last week when someone asked him the question, if you had a dollar, if 01:31:15.539 --> 01:31:17.259 SPEAKER_01: you had money, where would you put your money? 01:31:17.259 --> 01:31:21.019 SPEAKER_01: And he said, I would put my money on incentivizing electrification. 01:31:21.019 --> 01:31:26.859 SPEAKER_01: So I want to make sure you think about, like as we think about where we go and how we prioritize 01:31:26.859 --> 01:31:33.179 SPEAKER_01: things, incentivizing customers to switch to electrification can help our customers 01:31:33.179 --> 01:31:37.539 SPEAKER_01: save on their energy bill and it can also be a cost-effective way for us to help reduce 01:31:37.539 --> 01:31:42.260 SPEAKER_01: carbon emissions, particularly in those sectors that are really the largest emitting in our 01:31:42.260 --> 01:31:43.699 SPEAKER_01: region. 01:31:43.699 --> 01:31:45.659 SPEAKER_01: So next slide. 01:31:45.659 --> 01:31:49.899 SPEAKER_01: But as you think about electrification, I think there's one other thing I want to leave 01:31:49.899 --> 01:31:50.899 SPEAKER_01: you with. 01:31:50.899 --> 01:31:53.739 SPEAKER_01: It is a key priority for the future as we think about decarbonization and supporting 01:31:53.739 --> 01:31:55.140 SPEAKER_01: our customers in affordability. 01:31:55.140 --> 01:31:59.500 SPEAKER_01: It allows us to replace fossil fuels in our homes and vehicles and buildings with increasing 01:31:59.500 --> 01:32:00.500 SPEAKER_01: clean electricity. 01:32:00.500 --> 01:32:02.460 SPEAKER_01: However, there are some headwinds. 01:32:02.460 --> 01:32:06.300 SPEAKER_01: There are things that we have to think about as we think about increasing load growth from 01:32:06.300 --> 01:32:09.539 SPEAKER_01: buildings, transportation and electric loads. 01:32:09.539 --> 01:32:13.180 SPEAKER_01: Complementing electrification with load flexibility is important. 01:32:13.180 --> 01:32:16.659 SPEAKER_01: I'll talk a lot more about this as we talk about our integrated distribution resources 01:32:16.659 --> 01:32:18.900 SPEAKER_01: plan analysis in a future board meeting. 01:32:18.900 --> 01:32:23.820 SPEAKER_01: But as we grow that load, customers are going to face high upfront costs. 01:32:23.820 --> 01:32:27.420 SPEAKER_01: Scaling can create bottlenecks, both in capacity constraints on the grid as well as take time 01:32:27.420 --> 01:32:32.020 SPEAKER_01: for permitting and interconnection, as well as face supply chain and workforce bottlenecks. 01:32:32.020 --> 01:32:38.220 SPEAKER_01: But load flexibility can play a role in helping where we can partner with our customers to 01:32:38.220 --> 01:32:45.060 SPEAKER_01: shift load off of the peak, improve grid utilization, defer grid upgrades and help optimize investments 01:32:45.060 --> 01:32:48.740 SPEAKER_01: so that we can support affordability while supporting reliability. 01:32:48.740 --> 01:32:54.580 SPEAKER_01: So net, to scale decarbonization successfully, we need electrification paired with load flexibility. 01:32:54.580 --> 01:33:00.260 SPEAKER_01: So in conclusion, you've heard a lot about the external headwinds. 01:33:00.260 --> 01:33:04.500 SPEAKER_01: And they have made a significant impact on our program participation towards goals. 01:33:04.500 --> 01:33:08.420 SPEAKER_01: And the team has been working really, really hard on trying to find ways to get as close 01:33:08.420 --> 01:33:09.920 SPEAKER_01: as we possibly can. 01:33:09.920 --> 01:33:11.820 SPEAKER_01: But we still face significant challenges. 01:33:11.820 --> 01:33:15.699 SPEAKER_01: That external funding loss is not something we can make up alone. 01:33:15.699 --> 01:33:21.780 SPEAKER_01: But we do see that DERs remain still a large opportunity to afford affordability for customers 01:33:21.780 --> 01:33:22.780 SPEAKER_01: and our community. 01:33:22.780 --> 01:33:27.579 SPEAKER_01: And it helps enable them to participate in our decarbonization journal and make a significant 01:33:27.579 --> 01:33:28.699 SPEAKER_01: difference. 01:33:28.720 --> 01:33:33.960 SPEAKER_01: As we go into the IRP and talk about stakeholders and prioritization, those considerations are 01:33:33.960 --> 01:33:35.340 SPEAKER_01: going to be important. 01:33:35.340 --> 01:33:39.720 SPEAKER_01: And then again, to reiterate, the integrated distribution resources planning analysis, 01:33:39.720 --> 01:33:44.460 SPEAKER_01: it is helping inform, as I said, we are going to need to figure out what those new trajectory 01:33:44.460 --> 01:33:45.460 SPEAKER_01: goals are. 01:33:45.460 --> 01:33:50.699 SPEAKER_01: We cannot achieve those exponential growth ones and still stay affordable. 01:33:50.699 --> 01:33:54.859 SPEAKER_01: But it doesn't mean that we don't stop increasing what that looks like. 01:33:54.859 --> 01:34:01.699 SPEAKER_01: And I think as we embark upon the next couple months in our journey with the IRP, that will 01:34:01.699 --> 01:34:03.859 SPEAKER_01: be the opportunity to have that dialogue. 01:34:03.859 --> 01:34:06.979 SPEAKER_01: So with that, that's the end of my presentation. 01:34:06.979 --> 01:34:09.739 SPEAKER_01: I'm happy to take any additional questions. 01:34:13.259 --> 01:34:15.339 SPEAKER_06: First of all, Rachel, thank you. 01:34:15.339 --> 01:34:17.059 SPEAKER_06: And I know how much work went into this. 01:34:17.059 --> 01:34:21.579 SPEAKER_06: So thank you to the rest of the team that put in some effort on this, which is pretty 01:34:21.579 --> 01:34:25.579 SPEAKER_06: much company-wide, I'm assuming, at some level. 01:34:29.579 --> 01:34:32.819 SPEAKER_06: We couldn't have anticipated some of the headwinds we're seeing now when we embarked on this 01:34:32.819 --> 01:34:35.819 SPEAKER_06: journey. 01:34:35.819 --> 01:34:39.019 SPEAKER_06: We've got at least a couple more years of them, I'm afraid. 01:34:39.019 --> 01:34:43.420 SPEAKER_06: But after that, maybe things will get a little bit better, slowly but surely. 01:34:43.420 --> 01:34:45.939 SPEAKER_06: So I remain hopeful. 01:34:45.939 --> 01:34:50.739 SPEAKER_06: Actually achieving zero carbon by 2030, starting to look less and less likely. 01:34:51.739 --> 01:34:53.739 SPEAKER_06: I think we keep the goal. 01:34:53.739 --> 01:34:58.979 SPEAKER_06: We push as hard as we can, given the parameters that we've set up in terms of affordability and 01:34:58.979 --> 01:35:00.979 SPEAKER_06: reliability. 01:35:00.979 --> 01:35:02.979 SPEAKER_06: And we keep doing what we can do. 01:35:02.979 --> 01:35:11.979 SPEAKER_06: And gosh, if we only reduce our carbon output by 80% or 90%, oh gosh, oh darn, I'm so upset. 01:35:11.979 --> 01:35:13.979 SPEAKER_06: I will call that a win. 01:35:13.979 --> 01:35:15.979 SPEAKER_06: I will call that a win. 01:35:16.219 --> 01:35:21.219 Unknown: My question for you is, and this is one that I've been getting a lot out in public, and a few 01:35:21.219 --> 01:35:28.219 SPEAKER_06: coming in via email from people I know, concerned about, and this gets back to the large load 01:35:28.219 --> 01:35:35.219 SPEAKER_06: question, how much does new large load, i.e. data centers, how does that impact our 2030 carbon 01:35:35.219 --> 01:35:37.219 SPEAKER_06: goal? 01:35:37.219 --> 01:35:41.219 Unknown: And I think I know the answer right today. 01:35:41.219 --> 01:35:43.219 SPEAKER_06: Well, how many of them are we going to have by 2030? 01:35:43.460 --> 01:35:45.460 SPEAKER_06: I mean, is it 2 or 3? 01:35:45.460 --> 01:35:47.460 SPEAKER_06: Or is it 10 or 20? 01:35:47.460 --> 01:35:51.460 SPEAKER_06: And I don't think anybody envisions that many or that much load. 01:35:51.460 --> 01:35:55.460 SPEAKER_06: And I mean, I know that 90% of the time we can absorb that load and it's not a problem. 01:35:55.460 --> 01:35:57.460 SPEAKER_06: So let me, well, I'm sorry. 01:35:57.460 --> 01:35:59.460 SPEAKER_06: I'm answering my own question. 01:35:59.460 --> 01:36:04.460 SPEAKER_06: Let me ask you, how does the advent of additional data center load impact our 2030 zero carbon 01:36:04.460 --> 01:36:06.460 SPEAKER_06: plan? 01:36:06.460 --> 01:36:11.460 Unknown: So I know that there are others at SMUD that are probably a little bit closer to the data 01:36:11.699 --> 01:36:15.699 SPEAKER_01: center conversation, so I might. 01:36:15.699 --> 01:36:19.699 Unknown: Lauren Gway, CEO, General Manager. 01:36:19.699 --> 01:36:23.699 SPEAKER_03: Obviously, the additional load means that we need additional generation, so it just adds 01:36:23.699 --> 01:36:27.699 SPEAKER_03: to the amount of new resources that we need to bring online. 01:36:27.699 --> 01:36:29.699 SPEAKER_03: Thank you. 01:36:29.699 --> 01:36:31.699 Unknown: One quick question. 01:36:31.699 --> 01:36:43.699 Unknown: If our customers have solar, they're helping us get to the 2030 plan, right? 01:36:43.699 --> 01:36:51.699 SPEAKER_00: They don't have the battery to help us get to the 2030 zero carbon plan. 01:36:51.699 --> 01:36:55.699 Unknown: Even though if they've got the money, you know, it'd be helpful. 01:36:55.699 --> 01:37:01.699 SPEAKER_00: But that solar generation is helping us reach the 2030 goal, correct? 01:37:01.699 --> 01:37:03.699 SPEAKER_00: Yes. 01:37:03.699 --> 01:37:05.699 SPEAKER_01: Okay. 01:37:05.699 --> 01:37:09.699 SPEAKER_00: That's why I hope we have more balcony solar. 01:37:13.699 --> 01:37:19.699 Unknown: Rachel, could you, I know you said it, what's the top line number of our rooftop solar 01:37:19.699 --> 01:37:21.699 SPEAKER_05: installs at the number at the moment? 01:37:21.699 --> 01:37:27.699 SPEAKER_05: I think, you know, the cumulative number I have is as of Q2, and this is what's on 01:37:27.699 --> 01:37:35.699 SPEAKER_01: SMUD.org, as of Q2, 2026, over 67,000 customers have installed rooftop solar totaling nearly 01:37:35.699 --> 01:37:37.699 SPEAKER_01: 435 megawatts. 01:37:37.699 --> 01:37:39.699 SPEAKER_01: 435, okay. 01:37:39.699 --> 01:37:41.699 SPEAKER_01: Perfect. 01:37:41.699 --> 01:37:47.699 SPEAKER_01: My general comment with this presentation is that we have a lot of customers that are 01:37:47.699 --> 01:37:51.699 SPEAKER_05: not going to be able to get to the 2030 plan. 01:37:51.699 --> 01:37:59.699 SPEAKER_05: My general comment with this presentation is because it's under the 2030 plan update, 01:37:59.699 --> 01:38:05.699 SPEAKER_05: what we don't see is that metric tons avoided from all this electrification work. 01:38:05.699 --> 01:38:09.699 SPEAKER_05: I went and pulled up the SD9 presentation from last week. 01:38:09.699 --> 01:38:15.699 SPEAKER_05: When I added the building electrification with the transportation electrification, I got 01:38:15.699 --> 01:38:17.699 SPEAKER_05: it. 01:38:17.699 --> 01:38:19.699 SPEAKER_05: Am I understanding those numbers correctly? 01:38:19.699 --> 01:38:21.699 SPEAKER_05: Yes. 01:38:21.699 --> 01:38:29.699 SPEAKER_05: Because it helps me, knowing it's roughly 400,000 metric tons of carbon avoided, I can 01:38:29.699 --> 01:38:31.699 SPEAKER_05: put that in some context. 01:38:31.699 --> 01:38:35.699 SPEAKER_05: We're at 1.3, 1.4, 1.5 million metric tons. 01:38:35.699 --> 01:38:40.699 SPEAKER_05: This is sort of get a feel for what we're potentially avoiding through these electrification 01:38:40.699 --> 01:38:42.699 SPEAKER_05: programs. 01:38:42.699 --> 01:38:44.699 SPEAKER_05: Is that a fair train of thought? 01:38:44.699 --> 01:38:51.699 SPEAKER_05: For, yeah, for I think I said like what did I say, 2025 EVs are about 228,000 metric 01:38:51.699 --> 01:38:52.699 SPEAKER_01: tons. 01:38:52.699 --> 01:38:53.699 SPEAKER_01: 2026 we expect 270. 01:38:53.699 --> 01:38:58.699 SPEAKER_01: Then on the building electrification side, yeah. 01:38:58.699 --> 01:39:05.699 Unknown: Yeah, I think, yeah, Brian's numbers would be correct from his presentation. 01:39:05.699 --> 01:39:06.699 Unknown: All right. 01:39:06.699 --> 01:39:07.699 Unknown: Thank you. 01:39:07.699 --> 01:39:08.699 SPEAKER_05: Thank you for tonight's presentation. 01:39:08.699 --> 01:39:09.699 SPEAKER_05: It's great. 01:39:09.699 --> 01:39:10.699 SPEAKER_01: Thank you. 01:39:11.699 --> 01:39:12.699 Unknown: I'll send any comments. 01:39:12.699 --> 01:39:13.699 Unknown: Okay. 01:39:13.699 --> 01:39:14.699 Unknown: Thank you. 01:39:14.699 --> 01:39:15.699 SPEAKER_04: Do we have any speakers? 01:39:15.699 --> 01:39:16.699 SPEAKER_04: We do not. 01:39:16.699 --> 01:39:17.699 Unknown: Okay. 01:39:17.699 --> 01:39:18.699 Unknown: Any public comment, Brian, is not on the agenda? 01:39:18.699 --> 01:39:19.699 Unknown: I don't see any hands, no. 01:39:19.699 --> 01:39:20.699 SPEAKER_04: Okay. 01:39:20.699 --> 01:39:21.699 Unknown: Great. 01:39:21.699 --> 01:39:22.699 Unknown: And then I think there were a couple items of summary committee direction. 01:39:22.699 --> 01:39:23.699 SPEAKER_04: Okay. 01:39:23.699 --> 01:39:24.699 SPEAKER_04: Okay. 01:39:24.699 --> 01:39:25.699 Unknown: Okay. 01:39:25.699 --> 01:39:26.699 Unknown: Okay. 01:39:26.699 --> 01:39:27.699 SPEAKER_04: Okay. 01:39:27.699 --> 01:39:28.699 Unknown: Okay. 01:39:28.699 --> 01:39:29.699 SPEAKER_04: Okay. 01:39:29.699 --> 01:39:30.699 SPEAKER_04: Okay. 01:39:30.699 --> 01:39:31.699 SPEAKER_04: Okay. 01:39:31.699 --> 01:39:32.699 Unknown: Okay. 01:39:32.699 --> 01:39:33.699 Unknown: Okay. 01:39:33.699 --> 01:39:34.699 SPEAKER_04: Okay. 01:39:34.699 --> 01:39:35.699 SPEAKER_04: Okay. 01:39:35.699 --> 01:39:36.699 SPEAKER_04: Okay. 01:39:36.699 --> 01:39:37.699 SPEAKER_04: Okay. 01:39:37.699 --> 01:39:38.699 SPEAKER_04: Okay. 01:39:38.699 --> 01:39:39.699 SPEAKER_04: Okay. 01:39:39.699 --> 01:39:40.699 SPEAKER_04: Thank you. 01:39:40.699 --> 01:39:41.699 Unknown: Thank you. 01:39:41.699 --> 01:39:42.699 Unknown: Thank you, Brian. 01:39:42.699 --> 01:39:43.699 Unknown: Thank you. 01:39:43.699 --> 01:39:56.319 Unknown: Thank you, 01:39:56.319 --> 01:40:11.639 SPEAKER_02: Thank you.