City project
Grid Modernization Program
City utilities initiative to modernize the electric grid, including system upgrades, fiber construction, receiving-station work, and a second transmission corridor.
- Current status
- Ongoing multi-year planning and capital-program initiative.
- Location
- Palo Alto, CA
August 19, 2026: Implementation update
The City expects to invest approximately $400 million over the next decade or more; staff will focus over the next five years on replacing older equipment and increasing capacity.
Read related coverageAugust 5, 2026 reliability-goal discussion
Staff said Grid Modernization investments, including circuit ties, equipment upgrades, fault indicators, sectionalizing devices, and substation work, are intended to reduce outage scope and improve restoration performance.
Read related coverageJune 3, 2026 work-plan update
Commissioners added a standalone Grid Mod objective to the work plan and requested continuing review of strategy, citywide upgrades, design standards and technologies, investment timing, demand impacts, and customer impacts. Staff described the initiative as part of the electric capital-improvement program.
Read related coverageMay 27, 2026 Capital Improvement Plan review
Staff described approximately 19 grid-modernization projects and stated that a first bond tranche of about $80 million to $90 million would be issued within a total bond program of about $300 million.
Read related coverageFY 2026 Update
FY 2026 update presented as an informational report; the agenda states that no Council action was requested.
Read related coverageFebruary 2, 2026: Utilities Advisory Commission work-plan update
Staff reported that the Utilities Advisory Commission will continue reviewing grid modernization, capital-project phasing, reliability, and related utility planning.
Read related coverageFY2026 Mid-Year Electric Grid Modernization Update
Staff proposed prioritizing 60kV subtransmission reconductoring, conversion of legacy 4kV systems, substation reconstruction, and feeder ties while pacing 12kV distribution upgrades to customer electrification, permit activity, and AMI data. Staff said 4kV conversions were planned for completion by FY2028; substation work could extend through FY2034 because transformer lead times were four to five years.
Read related coverageFY 2025 Q3/Q4 reporting discussion
A commissioner said the quarterly-report entry, including 66 telephone poles installed, did not clearly convey the project's overall status or cost position. No project action occurred.
Read related coverageJune 9, 2025 council discussion
Pat Burt referenced Phase One as largely completed in the same fiscal year and discussed consulting costs associated with the initiative.
Read related coverageApril 2, 2025 electric-rate and financing update
Staff identified grid modernization as a principal driver of the FY 2026 rate proposal and stated that the utility expects debt financing to begin in FY 2026. The commission retained grid modernization in the revised work plan and discussed the need for strategic and financial oversight of the initiative.
Read related coverageMarch 5, 2025 budget update
Staff said the current budget aligns with the prior and forthcoming five-year CIP. Council had approved a $350 million resolution, including a $50 million buffer for potential cost increases and issuance costs; staff stated the project itself remains at $300 million.
Read related coverageDecember 16, 2024: Reimbursement-intention resolution adopted
Council adopted a resolution of intention to reimburse eligible expenditures from future tax-exempt utility revenue bonds.
Read related coverageNovember 12, 2024 grid modernization update
Staff reported that the first phase covers about 1,000 homes and that the utility department aims to upgrade 5,000 additional homes annually for three years in overhead-service areas. Staff also reported work on a second transmission pathway from PG&E's grid.
Read related coverage