HomeMy WebLinkAbout02. Set public hearing for 11-05-20 to award Power Purchase Agreement for solar project Page 1 of 2
Item 2.
CENTRAL SAN BOARD OF DIRECTORS
POSITION PAPER
MEETING DATE: OCTOBER 15, 2020
SUBJECT: SETA PUBLIC HEARING FOR NOVEMBER 5, 2020, AT 1:30 P.M. TO
CONSIDER AWARDING A POWER PURCHASE AGREEMENT TO REC
SOLAR COMMERCIAL CORPORATION FORA SOLAR PHOTOVOLTAIC
SYSTEM ON CENTRAL SAN'S LAGISS PROPERTY
SUBMITTED BY: INITIATING DEPARTMENT:
MELODY LABELLA, RESOURCE RECOVERY ENGINEERING AND TECHNICAL SERVICES-
PROGRAM MANAGER PDS-RESOURCE RECOVERY
REVIEWED BY: JEAN-MARC PETIT, DIRECTOR OF ENGINEERING AND TECHNICAL
SERVICES
Roger S. Bailey
General Manager
ISSUE
California Government Code Section 4217.12 requires public agencies to hold a public hearing when
considering award of energy services contracts.
BACKGROUND
On May 7, 2020, after careful evaluation and planning, the Board of Directors (Board) authorized staff to
proceed with the procurement of a solar energy Power Purchase Agreement (PPA)that would construct a
solar photovoltaic system on Central San's Lagiss property that is sized to offset all remaining grid power
purchases across Central San's operation in a typical year. Staff has completed a competitive
procurement process and initiated negotiations with the selected vendor, REC Solar Commercial
Corporation (REC), in an effort to prepare a PPA for the Board's future consideration.
California Government Code Section 4217.12 allows public agencies to execute a PPA if the public
agency holds a public hearing at a regular meeting and finds that the PPA is in the best interest of the
public agency and that the anticipated cost to the public agency for electrical energy provided by the P PA
will be less than the anticipated marginal cost to the public agency for other energy that would have been
October 15, 2020 Regular Board Meeting Agenda Packet- Page 14 of 89
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consumed by the public agency in the absence of the PPA. Accordingly, staff would like to set November
5, 2020, as the date for the public hearing.
ALTERNATIVES/CONSIDERATIONS
The Board could decide not to set the public hearing; however, since a public hearing is required by law to
execute a PPA, this would halt the implementation of the project. This alternative is not recommended.
FINANCIAL IMPACTS
Central San stands to save nearly$6.5 million dollars on future energy purchases in executing this PPA
with REC. Apart from minimal staff time to bring this item forward to the Board for consideration, the cost
to publish the Notice of Public Hearing is approximately$400.
COMMITTEE RECOMMENDATION
Staff will be seeking the Real Estate, Environmental & Planning (REEP) Committee's review of this matter
at their October 12, 2020, meeting. At that meeting, the REEP Committee will also review staff's Position
Paper for the November 5, 2020, Board meeting, which will recommend that the Board conduct a public
hearing to consider awarding a PPA to REC and authorize the General Manager to execute a PPA with
REC. The Position Paper will include details on the procurement process, the recommended vendor, and
the advantages of their proposal.
RECOMMENDED BOARD ACTION
Set a public hearing for November 5, 2020, at 1:30 p.m. to consider awarding a Power Purchase
Agreement with REC Solar Commercial Corporation for a solar photovoltaic system on Central San's
Lagiss Property.
Strategic Plan re-In
GOAL ONE: Customer and Community
Strategy 2—Maintain a positive reputation
GOAL TWO: Environmental Stewardship
Strategy 4- Reduce reliance on non-renewable energy
GOAL THREE: Fiscal Responsibility
Strategy 1—Maintain financial stability and sustainability
October 15, 2020 Regular Board Meeting Agenda Packet- Page 15 of 89