The San Francisco Public Utilities Commission (SFPUC) is taking significant steps to enhance its energy management capabilities by approving a substantial amendment to its contract with APX Incorporated. During a recent meeting, SFPUC officials presented Amendment Number 3, which seeks to increase the contract's financial scope by $3.1 million for professional services and a staggering $363 million for pass-through charges related to energy market participation. This amendment will extend the contract term to eight years, allowing the SFPUC to build internal expertise before issuing a new Request for Proposals (RFP).

The need for a scheduling coordinator is critical for the SFPUC, as it currently relies on APX to navigate the California Independent System Operator (CAISO) market. The CAISO oversees the Western grid, and participation requires either certification as a scheduling coordinator or contracting with one. While the SFPUC aims to eventually become its own scheduling coordinator, it acknowledges that it is not yet prepared to take on this responsibility due to financial and operational complexities.

The proposed amendment comes in response to unforeseen increases in energy market prices, which have surged due to factors such as global energy shortages and supply chain disruptions. The SFPUC's costs for participating in the CAISO market have risen dramatically, with pass-through costs increasing by 197% for Clean Power SF and 67% for Hecatechi Power in recent years. The majority of the costs associated with this amendment are fixed and non-negotiable, reflecting the realities of the energy market.

In addition to financial adjustments, the SFPUC plans to use this time to enhance its in-house capabilities. This includes installing automated systems at the Moccasin Powerhouse, which will allow for greater independence and efficiency in energy management. By strengthening its internal resources, the SFPUC hopes to attract a broader pool of bidders for future contracts, ultimately leading to more competitive pricing and improved service.

The discussions during the meeting highlighted the importance of these changes not only for the SFPUC but also for the residents of San Francisco. As the commission works to refine its processes and capabilities, the goal remains clear: to ensure reliable and cost-effective energy services for the community while preparing for a more self-sufficient future in energy management.