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POWER. As noted, the balance of the City's procurement requirement will be met through other contracts, primarily through the procurement of compost. The agreement between ABAG POWER and the City provides that ABAG POWER will procure the SB 1383-compliant RNG on behalf of the City, manage the direct contract with supplier, and collect and share with the City the required record keeping documents under the SB 1383 regulations. The agreement term is thirty-four months, and the cost is not to exceed $233,780. Further analysis of the City's consideration of procurement of SB 1383 compliant RNG was conducted by Rincon Consultants, Inc. An analysis of natural gas replacement with the purchase of RNG was completed (Attachment 2) and concluded that the replacement of fossil fuel natural gas with RNG has GHG reduction benefits. The analysis looked at various percentage levels at which the City could reduce natural gas and replace with RNG. Based on available funding, City staff selected to replace approximately 25 percent of the current ABAG POWER natural gas portfolio with RNG avoiding a total of approximately 161.42 metric tons (MT) of CO2 emissions annually. Additionally, Rincon Consultants, Inc. conducted a cost-benefit analysis of replacing natural gas with RNG based on the cost of procurement of the product and the social cost of carbon. The social cost of carbon is defined as the monetary value of net harm or economic damages to society from emitting a metric ton of the GHG to the atmosphere each year. The Rincon analysis concluded that replacing natural gas with RNG creates a Social Cost Avoided Emissions value equal to $30,670 annually. Approval of this contract will advance a significant component of the City's SB 1383 compliance strategy by procuring RNG to meet 30 percent of the City's State requirement over the next three years. This action also furthers the City's Climate Action Plan 2.0 by reducing GHG emissions and supporting strategies for climate resilience. Submitted by: Fiscal Review: Approved by: (i.aj Becky Hopkins Susan Hsieh Gerry Beaudin Assistant to the City Manager Director of Finance ity Manager Attachment: 1. Renewable Natural Gas Program Member Agreement by and between ABAG POWER and the City of Pleasanton 2. Letter dated March 15, 2023, from Rincon Consultants, Inc. Page 3 of 3