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W A T E R E N E R G Y L I k L :-3 III& RIVERSIDE PUBLIC UTILITIES Board Memorandum PUBLIC UTILITIES BOARD OF PUBLIC UTILITIES DATE: November 2, 2012 ITEM NO: S SUBJECT: PUBLIC UTILITIES ELECTRIC ANNUAL RESOURCE ADEQUACY PLAN FOR 2013 ISSUE: That the Board of Public Utilities consider approval of the Riverside Public Utilities' (RPU) Annual Resource Adequacy Plan for calendar year 2013 ("Plan"), as required by Public Utilities' Resource Adequacy Program ("RA Program"). RECOMMENDATION: That the Board of Public Utilities recommend that the City Council: 1. Approve Riverside Public Utilities' Annual Resource Adequacy Plan for 2013 and direct staff to file the document with the California Independent System Operator ('CAISO") in compliance with tariff requirements; and 2. Authorize the Board of Public Utilities to approve future annual Resource Adequacy Plan, in compliance with the City Council-approved RA Program, for filing with the CAI SO. BACKGROUND: "Resource Adequacy" refers to a utility's procurement of adequate power supply resources (i.e., capacity and energy) to serve its projected electric requirements, plus an additional amount to be held in reserve in case of unforeseen circumstances (e.g., unplanned transmission or generation outages). The City of Riverside first established its RA Program on May 23, 2005, through Resolution No. 21170 in response to California Independent System Operator Corporations ("CAISO") Tariff requirements regarding RA Programs. On June 5, 2012, the City Council adopted a revised RA Program which reflects current conditions, ensures implementation efficiency and further enhances electric reliability. The changes to the Annual RA Program included the following: • Revised the annual RA Plan procurement obligation to 100% of the City's forecasted non- summer monthly peak demands and at least 115% of City's summer monthly peak demands (July-September); • Eliminated the preparation of a monthly energy plan; • Established a minimum reserve margin for application under exigent circumstances beyond the City's control. (unforeseen transmission or generation outages beyond the City's control and impacting City's power resources); • Eliminated the provision of using liquidated damages contracts for RA capacity; and • Revised certain sections regarding resource bidding and to conform to most recently adopted CAISO Tariff and protocols.