The URL can be used to link to this page

Home My WebLink AboutRESO 9829{D0365802.DOCX / 1} Resolution No. 9829 Resolution of the Council of the City of Palo Alto Approving a Termination Agreement with Hecate Energy Palo Alto LLC and Approving a Long Term Power Purchase Agreement with Golden Fields Solar III, LLC for the Purchase of Solar Electricity A. On April 16, 2012, the Council approved an update to the Longterm Electric LEAP ) strategy related to the Renewable Portfolio Standard (RPS ). The reduce the carbon intensity of the electric portfolio by pursuing a minimum level of renewable purchases of at least 33 percent of retail electricity sales by 2015 within a rate impact cap of 0.5 cents per kilowatthour. B. On March 4, 2013, the Council approved a Carbon Neutral Plan, which enabled the City to achieve a carbon neutral electric supply portfolio starting in calendar year 2013. C. On October 7, 2015 350, which requires that all retail sellers of electricity in California, including publiclyowned utilities, serve 50 percent of their retail electricity sales with renewable energy by 2030. D. The City was interested in purchasing power generated by renewable resources for the benefit of its electric customers to reduce the production of greenhouse gases, meet RPS requirements under SB 350 and LEAP, and meet its Carbon Neutral Plan goals and issued Request for Proposals 156876 May 2015. E. Hecate Energy Palo Alto LLC HEPA rough its parent company, Hecate Energy LLC, proposed its project, the Wilsona Solar project, , and its proposal was highly competitive with other RFP respondent proposals. F. Council approved HEPA on March 21, 2016, effective as of July 18, 2016 (as further amended, modified, supplemented and/or restated, and including all related agreements, instruments and documents, including a certain Letter Agreement, dated as of October 24, 2016, and also including Amendment No. 1 to Power for the sale of energy to City from HEPA upon completion of an approximately 26 MW photovoltaic solar electric generating facility that was to be developed, financed, built and owned by HEPA. G. Prior to the development of the generating facility, HEPA desired to assign the City/Hecate PPA to Golden Fields Solar III LLC City/Hecate PPA, which provides that the City must consent in writing prior to any assignment of the rights and obligations of the City/Hecate PPA, and that consent must not be unreasonably withheld. DocuSign Envelope ID: 8F1285D3-EC6C-4DC7-AF31-C29DE1574443 {D0365802.DOCX / 1} H. Pursuant to its obligations under Section 10.2 of the City/Hecate PPA, the City successfully negotiated an agreement with Golden Fields . I. Pursuant to the City/Golden Fields PPA, Golden Fields intends to develop, finance, build, own and operate an approximately 240 MW solar photovoltaic electric generat metered solar photovoltaic electric generating facilities, one of which will be dedicated to serve the City J. The City wishes to purchase the output of the Plant to meet its needs at a known price and timing and intends to resell related energy to its residential and commercial customers. K.City/Golden Fields PPA may result in surplus electric purchases that are inconsistent with the antispeculation requirement of section D.1 of resources, and potential uncertainties associated with the timeliness and viability of the . L. Because the PPA which resulted from the negotiations between City and Golden different than the City/Hecate PPA which was to be assigned, the City, HEPA and Golden Fields agreed to terminate the City/Hecate PPA and for the City to separately enter into the City/Golden Fields PPA, with certain conditions precedent on the termination of the City/Hecate PPA. The Council of the City of Palo Alto does RESOLVE as follows: SECTION 1. The Council approves the Termination Agreement under which the City and Hecate Energy Palo Alto LLC mutually agree to the termination of their Power Purchase Agreement (PPA ) from 2016 . SECTION 2. The Council approves the PPA between Golden Fields Solar III, LLC, as seller, and the City of Palo Alto, as buyer . The delivery term of the City/Golden Fields PPA is up to forty (40) years, commencing upon the commercial operation date of the planned electric generation facility, which date is expected to be no later than January 1, 2023. The City will receive a 26 MW authority under the PPA shall not exceed one hundred one million dollars ($101,000,000). SECTION 3. The Council delegates to the City Manager, or his designee, the authority to (1) execute the Termination Agreement between the City and Hecate Energy Palo Alto LLC, on behalf of the City; and (2) execute the City/Golden Fields PPA with Golden Fields Solar III, LLC on behalf of the City, and the authority to execute any documents necessary to administer the DocuSign Envelope ID: 8F1285D3-EC6C-4DC7-AF31-C29DE1574443 {D0365802.DOCX / 1} City/Golden Fields PPA that are consistent with the Palo Alto Municipal Code and City Council approved policies. SECTION 4. As permitted by section 2.30.290 of the Palo Alto Municipal Code, the Council delegates to the City Manager, or his designee, the authority to exercise at his discretion any or all of the three extension term options included in the City/Golden Fields PPA, to extend the twentyfive year base contract up to a forty year contract term for the City. SECTION 5. City/Golden Fields PPA referred to in Section 2 above, the Council waives the creditworthiness requirements of Palo Alto Municipal Code section 2.30.340(c), as that requirement may apply to Golden Fields Solar III, LLC. SECTION 6. City/Golden Fields PPA referred to in Section 2 above, the Council waives the antispeculation requirement of Section existing Energy Risk Management Policy, as that requirement may apply to surplus electricity purchases caused by he PPA with Golden Fields Solar III, LLC. // // // // // // // // // // // // // DocuSign Envelope ID: 8F1285D3-EC6C-4DC7-AF31-C29DE1574443 {D0365802.DOCX / 1} SECTION 7. e City/Golden Fields PPA does not meet the definition of a project under the California Environmental Quality Act (CEQA), pursuant to Public Resources Code Section 21065. However, the City does intend, pursuant to the City/Golden Fields PPA, to receive output from a project that will constitute a project for the purposes of CEQA. The project developer, Golden Fields, will be responsible for acquiring necessary environmental reviews and permits on the project to be developed, and the City/Golden Fields PPA provides for the City to receive confirmation that all CEQA requirements have been met as a condition precedent to the INTRODUCED AND PASSED: May 6, 2019 AYES: CORMACK, DUBOIS, FILSETH, KNISS, KOU NOES: ABSENT: FINE, TANAKA ABSTENTIONS: ATTEST: City Clerk Mayor APPROVED AS TO FORM: APPROVED: Assistant City Attorney City Manager Director of Utilities Director of Administrative Services DocuSign Envelope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