HomeMy WebLinkAboutRESOLUTION 2024-014 N.C.S. 02/26/2024
Resolution No. 2024-014 N.C.S. Page 1
Resolution No. 2024-014 N.C.S.
of the City of Petaluma, California
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PETALUMA RATIFYING AN
AMENDMENT TO A POWER PURCHASE AGREEMENT WITH ELLIS CREEK SOLAR LLC FOR
A FLOATING SOLAR ARRAY AT ELLIS CREEK WATER RECYCLING FACILITY
WHEREAS, on December 19, 2022, the City Council approved Resolution 2022-200 authorizing the City
Manager to execute all documents necessary to enter into a Power Purchase Agreement with Ellis Creek Solar
LLC; and
WHEREAS, the Power Purchase Agreement and related contract documents requires Ellis Creek Solar LLC
to design, construct, and install a certain photovoltaic system, arrange with the local utility for interconnection of
the facilities, and generate electricity to be sold to the City at specified rates; and
WHEREAS, since the December 19, 2022 Council approval of this project, staff has met approximately
weekly with Ellis Creek Solar staff to deliver the project; and
WHEREAS, to reduce the impact on mosquito issues, staff from the Marin Sonoma Mosquito and Vector
Control District (MSMVCD) were included frequently during discussions involving project design; and
WHEREAS, over the fall 2023, the array was redesigned to include six gangways from the pond edge to the
array, six additional wider walkways to accommodate the movement of staff and equipment on the array, and
increased tilt of the solar panels to create a larger gap from which testing equipment would be placed; and
WHEREAS, the resulting design changes resulted in material changes to cost of the project to Ellis Creek
Solar as well as project schedule, so an amendment to the agreement was requested, negotiated, and execute; and
WHEREAS, in accordance with the requirements of Government Code section 4217.12, and based on data
provided in Attachment 3 of the December 19, 2022 City Council item, the City Council finds that the terms of
the Power Purchase Agreement and related agreements are in the best interest of the City because the anticipated
cost to the City for the electrical energy and related services to be provided under the agreement will be less than
the marginal cost to the City of the electrical energy that would have been consumed by the City in the absence
of the agreement, because there will be no ground lease of City property related to the Power Purchase Agreement,
and the site license authorizing the use of a portion of the Ellis Creek Water Recycling Facility for installation
and operation of a solar voltaic array involves City land and facilities with de minimis rental value, comprising
as they do part of a working municipal waste treatment and water recycling facility, and any such de minimis
rental value of the City land and facilities involved will be offset by energy savings and other benefits under the
Power Purchase Agreement, and the terms of the Power Purchase Agreement are otherwise protective of the
interests of the City, its wastewater customers and Petaluma community members generally.
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Petaluma as follows:
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Resolution No. 2024-014 N.C.S. Page 2
1. The above recitals are hereby declared to be true and correct and are incorporated into this resolution as
findings of the City Council. 2. Finds that this action, amending the PPA to amend the design, falls within the December 19, 2022, action as the addendum to the Ellis Creek Water Recycling Facility EIR accounted for design of the floating
solar array. Moreover, even if this action was not within the addendum to the EIR, this contract amendment
is exempt under the Commonsense exemption, CEQA Guidelines Section 15061, as the redesign is necessary to help address the impacts of mosquitos on the project.
3. Ratifies an Amendment to a Power Purchase Agreement with Ellis Creek Solar LLC for a Floating Solar
Array at Ellis Creek Water Recycling Facility, attachment A, and authorize the City Manager to sign any
documents to affect this and future amendments.
4. Still finds with this action, in accordance with the requirements of Government Code section 4217.12, and based on data provided in Attachment 3 of the December 19, 2022 City Council item, that the terms of the Power Purchase Agreement and related agreements are in the best interest of the City because the
anticipated cost to the City for the electrical energy and related services to be provided under the agreement will be less than the marginal cost to the City of the electrical energy that would have been consumed by the City in the absence of the agreement, because there will be no ground lease of City property related to the Power Purchase Agreement, and the site license authorizing the use of a portion of the Ellis Creek Water Recycling Facility for installation and operation of a solar voltaic array involves
City land and facilities with de minimis rental value, comprising as they do part of a working municipal waste treatment and water recycling facility, and any such de minimis rental value of the City land and facilities involved will be offset by energy savings and other benefits under the Power Purchase Agreement, and the terms of the Power Purchase Agreement are otherwise protective of the interests of the City, its wastewater customers and Petaluma community members generally.
Under the power and authority conferred upon this Council by the Charter of said City.
REFERENCE: I hereby certify the foregoing Resolution was introduced and adopted by the
Council of the City of Petaluma at a Regular meeting on the 26th of February
2024, by the following vote:
Approved as to
form:
__________________________
City Attorney
AYES: McDonnell, Cader Thompson, Healy, Nau, Pocekay, Shribbs
NOES: Barnacle
ABSENT: None
ABSTAIN: None
ATTEST: ______________________________________________
City Clerk ____________________________________________
Mayor
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Resolution No. 2024-014 N.C.S. Page 3
EXHIBIT A
PPA Amendment
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First Amendment (“Amendment”) to the Energy Services Agreement (Agreement) between
ELLIS CREEK SOLAR, LLC, A DELAWARE LIMITED LIABILITY COMPANY
(“Provider”), and the CITY OF PETALUMA, a California municipal corporation and a charter
city (“Purchaser”); each, a “party” and together, the “parties”.
The Agreement is hereby amended as follows:
1. Paragraph “O,” “Mechanical Completion,” of Section 3, “Definitions” of the Agreement is
replaced by the following
o. “Mechanical Completion:” means the time by which i) the building department of the
Purchaser has provided final approval of the Project’s building and electrical permits,
the approved building and electrical permits and request for Permission to Operate have
been submitted to the Local Electric Utility, and ii) Close of Construction Financing
has occurred.
2. Section 7, “Project Milestone Dates,” of the Agreement is replaced by the following:
a. The Guaranteed Construction Start Date is December 31, 2023, October 21, 2024,
subject to extension as set forth in Section 5 of Exhibit C, General Terms and
Conditions.
b. The Guaranteed Commercial Operation Date is twelve (12) months from the
Construction Start Date, October 21, 2025, subject to extension as set forth in Section
5 of Exhibit C, General Terms and Conditions.
3. The PPA Rate Table in Section 9, “Energy Services Payments” of the Agreement is replaced by
the following:
PPA Rate Table
Term Year kWh Rate ($/kWh)
1 0.1241
2 0.1266
3 0.1291
4 0.1317
5 0.1343
6 0.1370
7 0.1398
8 0.1426
9 0.1454
10 0.1483
11 0.1513
12 0.1543
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13 0.1574
14 0.1606
15 0.1638
16 0.1670
17 0.1704
18 0.1738
19 0.1773
20 0.1808
4. Section 14, “Allowed Disruption Time” of the Agreement, is replaced by the following:
a. Notwithstanding any provisions in Section 7.3 of the General Terms and Conditions to the
contrary, Purchaser may, upon at least fourteen (14) days’ advance written notice to
Provider, request that the System or a portion of the System be rendered non-operational
for any reason for a maximum of 24 Daylight Hours per year of the Term. If the System or
a portion of the System is rendered non-operational at Purchaser’s request, the amount of
Allowed Disruption Time used shall be calculated using the methodology described in
Exhibit F to the Agreement, “Performance Test”, or through a methodology mutually
agreed upon by the Purchaser and Provider. If Purchaser does not utilize the full 24
Daylight Hours of Allowed Disruption Time in a given year, then any unused portion of
such Allowed Disruption Time will rollover and accrue to the subsequent year and be
added to that year’s Allowed Disruption Time of 24 Daylight Hours; provided, that in no
event shall the total Allowed Disruption Time during any year including any accruals from
prior years exceed 72 Daylight Hours. Purchaser shall not be obligated to make payments
to Provider for electricity not received during the Allowed Disruption Time, nor shall
Purchaser be required to reimburse Provider for any other lost revenue during the Allowed
Disruption Time, including any lost revenue associated with any reduced sales of
Environmental Attributes. Provider shall be credited for the estimated lost electricity
production the System would have produced during such Allowed Disruption Time toward
satisfaction of its Minimum Guaranteed Output, as set forth in Section 13, such estimated
lost production to be calculated in the same manner as set forth in Section 9. The Parties
acknowledge that if as a result of a Public Safety Power Shutoff event, as determined
necessary by the Local Electric Utility from time to time, Provider is unable to perform or
Purchaser is unable to receive Energy Services during such event, Provider shall not be
entitled to compensation from Purchaser pursuant to Section 7.3 of the General Terms and
Conditions for lost revenue caused by the event.
b. If the amount of time in a given year during the Term that the System or a portion of the
System is non-operational at Purchaser’s request exceeds the Allowed Disruption Time,
applying the accrued but unused Allowed Disruption Time from prior years, then in
addition to crediting the Provider for the estimated lost electricity production that the
System would have produced during the non-operational time in excess of the Allowed
Disruption Time toward satisfaction of the Minimum Guaranteed Output in Section 13, the
Purchaser shall also pay Provider for such lost electricity during non-operational time in
excess of the Allowed Disruption Time at the rates in the PPA Rate Table in Section 9 as
part of Purchaser’s Energy Service Payments.
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5. Exhibit B to the Agreement, “Insurance Requirements,” is replaced by the new Exhibit B
attached to and made a part of this Amendment.
6. The Early Termination Fee Table in Section 2.1, “Termination By Purchaser,” in Exhibit C,
“General Terms and Conditions” to the Agreement is replaced by the following:
Early Termination Fee
Early Termination Occurs in
Year:
Early
Termination Fee
On the Effective Date and prior to
the Design Drawing Approval Date $4,046,500
On the Design Drawing Approval
Date and prior to the Building and
Electrical Permit Receipt Date
$6,199,500
On the Building and Electrical
Permit Receipt Date and prior to the
first anniversary of the Commercial
Operation Date
$19,976,616.69
2 $19,032,978.82
3 $18,133,914.63
4 $17,277,319.63
5 $16,461,188.93
6 $11,881,647.29
7 $10,429,906.44
8 $9,155,544.72
9 $8,036,890.17
10 $7,054,914.20
11 $6,192,921.32
12 $5,436,250.30
13 $4,772,030.24
14 $4,188,967.36
15 $3,677,144.49
16 $3,227,858.85
17 $2,833,467.62
18 $2,487,265.26
19 $2,183,362.24
20 $1,916,591.84
7. Section 5.0 “Milestone Extensions,” in Exhibit C, “General Terms and Conditions” to the
Agreement, is modified by replacing paragraph (i) with the following new paragraph (i), and by
the addition of a new paragraph (vii), as follows:
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(i) a request by the Purchaser to delay the Commencement of Construction, provided
that any such request shall not exceed five months. Purchaser shall not request delay
in Commencement of Construction after authorizing Provider to proceed with 90
percent Issued for Permits design set; unless a Force Majeure Event as defined in
Section 1.26 of this Exhibit occurs and as a result Purchaser reasonably determines
Commencement of Construction must be delayed for continued safe and lawful
operations of the ECWRF.
(vii.) Purchaser review and submission of complete comments of any design set takes
more than review times specified in Exhibit D.2, Section 2.04.
8. Section 2, “Mosquito Abatement Requirements,” of Exhibit E to the Agreement, “Site
Specific Requirements,” is replaced by the following:
2. Mosquito Abatement Requirements
2.1. Provider acknowledges that Purchaser must comply with certain Legal
Requirements and regulations with regard to mosquito abatement on and around
the Premises, and that placement of floating photovoltaic (PV) array (“System”)
may interfere with those activities or create or exacerbate mosquito breeding
environments. To ensure Purchaser’s compliance with mosquito abatement
requirements and to control mosquito populations associated with the Project,
Provider shall comply with the following conditions.
2.2. Marin/Sonoma Mosquito and Vector Control District (“MSMVCD”) or another
Purchaser-approved contractor will continue to perform mosquito surveillance and
abatement measures at the Premises, including within and immediately around the
System, and conduct abatement measures (as needed). This includes the continued
invoicing of such services to the Purchaser.
2.3. Provider shall design Project to minimize open water within the System.
2.4. Provider shall design Project to allow access for MSMVCD personnel or Purchaser-
approved contractor and equipment in and around the Project. Such equipment
includes but is not limited to: helicopter; watercraft, including air boat, flat bottom
boat, and kayak; truck-based applicators; backpack sprayers and blowers; aquatic
drones; and hand applicators.
2.5. Provider shall allow access for MSMVCD personnel or Purchaser-approved
contractor and equipment in and around Project, including onto the solar array
floats, for mosquito abatement treatment and surveillance.
2.6. MSMVCD or Purchaser-approved contractor will determine the method of
mosquito abatement including the type of equipment and chemical(s). MSMVCD
will determine the timing of mosquito abatement activities in consultation with
Ellis Creek Water Recycling Facility (ECWRF) staff. Purchaser shall make all
reasonable efforts to notify Provider in advance of mosquito abatement activities
that may impact installation, operation, or maintenance of the Project.
2.7. Provider to reimburse Purchaser for up to $10,000 annually for MSMVCD or
Purchaser-approved contractor costs directly attributable to Project installation,
maintenance and operations.
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2.8. Provider shall provide training to MSMVCD staff or Purchaser-approved
contractor regarding safe access in, on, and around the System, and be available for
communication with the Purchaser and MSMVCD regarding all mosquito
surveillance and abatement activities at the Premises.
2.9. Provider shall participate in monthly meetings with Purchaser and MSMVCD
and/or Purchaser-approved contractor during the first two years of operation to
identify and address issues as they arise. After the first two years, meetings shall be
held as often as mutually agreed upon by the parties.
9. Except as amended by this Amendment, all terms and conditions of the Agreement and the
rights and responsibilities of the parties under the Agreement remain unchanged and continue
in full force and effect.
IN WITNESS WHEREOF and in confirmation of their consent to this Amendment and intending
to be legally bound hereby, Provider and Purchaser have executed this Amendment to be
effective as of December 21, 2023.
PURCHASER PROVIDER
CITY OF PETALUMA ELLIS CREEK SOLAR, LLC
__________________________ __________________________
Peggy Flynn, City Manager Evan Riley, Authorized Person
Managing Partner
Date: ____________________
Approved as to form:
__________________________
Eric Danly, City Attorney
Attest:
__________________________
City Clerk
Attachment: Replacement Exhibit B – Insurance Requirements
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12/21/202312/21/2023
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