Staff recommends City Council adopt a resolution authorizing the City Manager to execute the First Amendment to the Retail Electric Energy Services Agreement with TSI Semiconductors America LLC.

For many years the City of Roseville has worked closely with its large electric customers to design future infrastructure, pre-purchase power, plan maintenance outages, coordinate load shedding during system emergencies, and implement energy efficiency improvements. This work benefits individual customers, the electric utility, other electric customers, and the City.

In 2019, the City entered into a two-year Retail Electric Energy Services Agreement (Agreement) with the TSI Semiconductor America LLC (TSI). The Agreement, among other items, provides TSI with a discount on certain electricity rates. The Agreement is scheduled to expire on February 5, 2021.

The purpose of this amendment is to extend the term of the Agreement and revise the discount provided to TSI on energy charges. The amended Agreement will help stabilize the utility’s future revenues, reduce the risk of needing to raise rates on other customers, and continues an important partnership with a large electric customer. The key obligations of the Agreement between the City and TSI remain unchanged and include:

• Customer agrees to:
  • Receive electricity only from the City;
  • Provide load forecasts to the City;
  • Coordinate future energy efficiency projects with the City;
  • Participate in peak load reduction programs with the City; and
  • Partner with the City to reduce energy demand during grid emergencies.

The amendment includes all the items from the initial Agreement and the following amended terms:

• City agrees to:
  • Provide a 5% discount on the customer’s energy charges from February 6, 2021 to December 31, 2022.

This amendment to the Agreement will provide significant value to the City and other electric customers. A portion of TSI’s existing energy rate pays to maintain and operate the City’s electric distribution system. Roseville Electric Utility estimates that TSI currently provides over $2 million in annual contributions to help maintain and operate the City’s electrical distribution system and pay the electric utility's debt service. 

The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment, or is otherwise not considered a project as defined by CEQA Statute §21065 and CEQA State Guidelines §15060(c)(3) and§15378.

The Retail Electric Energy Services Agreement First Amendment meets the above criteria and is not subject to CEQA. No additional environmental review is required.

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Dominick Casey, City Manager