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Page 1 of 5 <br />Item #13 <br /> CITY COUNCIL AGENDA REPORT <br /> <br />April 21, 2026 <br />Public Works - Engineering Division <br /> <br />TITLE: AUTHORIZE THE CITY MANAGER TO ENTER INTO AN ENERGY SERVICES <br />AGREEMENT WITH CLIMATEC FOR COMPREHENSIVE FACILITY <br />IMPROVEMENTS: ENERGY EFFICIENCY AND RESILIENCE TO DEVELOP <br />AN ENERGY INFRASTRUCTURE MODERNIZATION PROGRAM <br /> <br />SUMMARY <br />As City facilities and infrastructure age amid new regulations, rising energy costs, and ongoing <br />power outages, the City is pursuing comprehensive improvements to reduce energy <br />consumption and strengthen efficiency and resilience. <br /> <br />Consistent with the City's Strategic Plan and the Climate Action Plan (CAP) 2.0, the City <br />issued a Request for Qualifications (RFQ) in April 2025 for the design and delivery of <br />comprehensive energy, gas, and water infrastructure improvements. Staff recommends <br />awarding the RFQ to Climatec as the most qualified respondent and approve an Energy <br />Services Agreement (ESA) to deliver turnkey development, implementation, monitoring, and <br />funding application assistance for an Energy Infrastructure Modernization Program (the <br />Program). <br /> <br />Approving an ESA with Climatec would authorize the City to begin citywide assessments and <br />develop a preliminary scope and funding options for City Council review before any <br />implementation work is authorized. Following City Council direction, Climatec would then <br />complete detailed assessments and return to the City Council with an ESA amendment to <br />authorize implementation with a not-to-exceed amount and savings guarantee. <br /> <br />RECOMMENDATION <br />Approve and authorize the City Manager to enter into an Energy Services Agreement with <br />Climatec for Comprehensive Facility Improvements: Energy Efficiency and Resilience to <br />develop an Energy Infrastructure Modernization Program. <br /> <br />BACKGROUND <br />The City's energy utility rates have increased by an average of seven percent annually over <br />the past nine years, increasing pressure on the General Fund and making efficiency <br />investments imperative to support ongoing and future operations. More frequent power <br />outages and events such as wildfires highlight the need to strengthen resilience measures <br />across City facilities. City facilities also lack the infrastructure needed to meet new and <br />upcoming regulatory requirements. <br /> <br />For example, the California Air Resources Board (CARB) Advanced Clean Fleets Regulation <br />requires 50 percent of municipal fleet vehicle purchases to be zero-emission vehicles (ZEVs), <br />increasing to 100 percent beginning in 2027. The City currently lacks sufficient infrastructure to <br />support this transition, except for a fleet charging project in design at the City Corporation Yard <br />Page 238 of 846