HomeMy WebLinkAboutAgenda Report - December 19, 2007 K-03AGENDA ITEM Ko�
CITY OF LODI
COUNCIL COMMUNICATION
TM
AGENDA TITLE: Adopt resolution authorizing the City Managerto execute an updated Second
Phase Member Agreementwith the Northern California Power Agency forthe
Lodi Energy Center ($3,030,000) (EUD)
MEETING DATE: December 19,2007
PREPARED BY Electric Utility Director
RECOMMENDED ACTION: Adopt a resolution authorizing the City Manager to execute an
updated Second Phase Agreement with the Northern California
Power Agency (NCPA)for Financing the Planning and Development
Activities of the Lodi Energy Center.
BACKGROUND INFORMATION: On March 7, 2007, the City Council approved execution of a Second
Phase MemberAgreement with NCPA for the New Lodi Project (now called the Lodi Energy Center).The
New Lodi Project is a potential 255 MW combined cycle generation facility located adjacent to the
existing NCPA Combustion Turbine Project No. 2 facility at White Slough for possible operation in 2010
(presently 2012). Lodi's participation level wastis 30 megawatts.
This original Second Phase MemberAgreement provided that it would not become effective until
participants representing 95% of the planned participation level had executed the contract. This level was
never reached hence the agreement did not become operational. Contract cost limits for Phase 2A and
2B were $3.9 million and $10.1 million respectivelyfor a total Second Phase cost of $14 million.
Since that time (i) new participants, (ii) cost and schedule changes and (iii) changes in phase activities
have dictated revisions in the original Second Phase MemberAgreement. The updated agreement is
attached for review and approval.
Underthe updated agreement, the first sub -Phase (Phase 2A) provides for the completion of initial
engineering studies and project definition, submittal of application for California Energy Commission
(CEC) approval, and an updated assessmentof the availability/cost of equipment for the project,
machines, and the acquisition of emission reduction credits (ERC's) or options. The second sub -Phase
(Phase 2B) includes completion of the CEC process, final acquisition of ERC's as may be necessary,
completion of documents for Phase 3, and the release of bid document(s) for construction. Phase 26 will
not be undertaken by NCPA except upon the project members' further authorization pursuant to the
terms of the Agreement. Updated contractual cost levels for Phase 2A is $16 million and a total Second
Phase maximum cost of $25 million. The $16 million for Phase 2A is intended to allow for purchase of
ERCs, though that may be deferred, shifting cost from Phase 2A to Phase 213. The $25 million cap for
Phase 2 applies to the total of the two sub -Phases, regardless.
The current schedule calls for a ten (10) month period of work for Phase 2A and an additional ten (10
months for Phase 2B. If Phase 2A begins at the end of January, 2008, it is projected to be completed in
APPROVED:
ai ing, City Manager
Adopt resolution authorizing the City Managerto execute a Member Agreement (Second Phase) with the Northern
California Power Agency for the Lodi Energy Center ($3,030,000) (EUDI
December 19, 2007
Page 2 of 3
November 2008. In this case, Phase 2B will begin in December, 2008 and proceed though September
2009. The current operational date for the project is April 2012 with construction to begin in the second
quarter of 2010.
Costs have increased significantly from the original Second Phase Agreement ($14 million) to the present
agreement ($25 million). This is due in large part to the increased cost of emission offset credits (ERCs)
The projectwill be required to purchase offsets for its projected emissions of PM 10 (particulates below 10
microns in diameter), NOx, SOx and VOCs (volatile organic compounds). The expected costs of
acquiring ERCs for the project has increased from about $4.5 million to as much as $12.5 million. Other
changes in estimated costs are as follows:
Note: "ERC Option" scenario involves obtaining "options" to buy ERC credits
ratherthan actual credits in Phase 2A with ERC actual purchase in Phase 2B.
Options would cap the cost of ERCs, but require payment of a premium upfront.
Given the current level of subscription to the project, Lodi's pro -rata share of the licensing and
development costs for a 30 MW share (about 12.1 % at the 249 MW subscription level) will be about
$3.03 million, of which up to $1.94 million would be spent in Phase 2A. (Costs may vary from this
projection depending on participation levels of other entities.) If the project is found to be feasible, and if
Lodi elects to proceed with project development, a Third Phase agreement will allocate rights to
participate in final costs and benefits on the same basis. If the project is eventually financed for
construction, the second phase costs would be reimbursed to the Members from any project financings.
If the project is cancelled before construction financing, any purchased air pollution emission credits may
be resold or applied to another project. Since supply of ERCs is expected to be more limited than
demand, ERCs are believed to be an appreciating asset.
The Project is currently subscribed at 249 MW with 6 MW outstanding (unsubscribed). NCPA has
meetings planned with other Municipal and Water Agency counterpartiesto fill the remaining 6 MW. The
Lodi Energy Center Phase 2 Agreement becomes effective once approved by entities comprising 85
percent or more (216.75 MW) of the initial participation percentage levels. Signatoriesto the Agreement
will have the right to reduce their participation or to withdraw wholly from the project if a signatory's
financial commitment increases beyond its original pro rata share of the Phase 2A budget of $16 million
or priorto initiation of Phase 2B or Phase 3.
Adopt resolution authorizing the City Manager to execute a MemberAgreement (Second Phase) with the Northern
California PowerAgency for the Lodi Energy Center ($3,030,000) (EUD)
December 19,2007
Page 3 of 3
Staffs recommendation also includes designation of the City's Electric Utility Director as the City's
authorized representative under the Phase 2 Agreement with the authority to undertake project votes and
other administrative actions required of the utility under the agreement.
FISCAL IMPACT: Lodi's projected $3.03 million share of costs under this agreement is planned to be
funded through residual bond proceeds. Costs may vary from this projection
depending on final participation levels of other entities. An additional commitment
of up to 15% of this amount (and a corresponding increase in project share) may
be permitted by the agreement in case of under-subscriptionto the project or
default of another project participant, subject to a participant's right to reduce
participation or to withdraw if its financial commitment increases beyond initial
designation levels. Advances to NCPA to cover costs shall be made within sixty
days of invoice and are expected to generally reflect project cash flow needs.
FUNDING: UncorrAr4�fte#$nd proceeds (Account No. 161.1080)
, Budget Manager
c o
.7eorae F. Nrorrow
Electric Utility Director
Attachments
RESOLUTION NO. 07-72
RESOLUTION OF THE COMMISSION OF THE NORTHERN CALIFORNIA POWER
AGENCY APPROVING THE REVISED SECOND PHASEAGREEMENT OF THE
LODI ENERGY CENTER PROJECT DEVELOPMENT
WHEREAS, in November 2006, the NCPA Commission authorized the NCPA General
Manager to execute Second Phase New Lodi Project Development Agreements with NCPA Members,
and NCPA and participating NCPA members now desire to revise the previously approved Second
Phase Agreement to change the project name to the Lodi Energy Center and to allow for project
participation by public entities that are not NCPA members (Non-NCPA Members); and
WHEREAS, NCPA members have identified the need for additional power supply resources to
meet their anticipated demand for energy and capacity over the next ten years and beyond; and
WHEREAS, members have considered options including market purchases, acquisition of
existing projects, partnerships in resources development with other entities, increasing the capacity at
existing NCPA plants, and developing new and more efficient resources; and
WHEREAS, members desire to develop and construct an efficient, economic and
environmentally responsible energy and capacity resource as part of their power mix strategy; and
WHEREAS, entering into the Second Phase Agreement will assist the Participating Members in
planning to meet their capacity and energy power goals, reduce reliance on power purchase agreements
and associated fuel price volatilities, and assist the State of California in meeting its reserve requirements
and energy goals, and will reduce costs by economics of scale, avoiding duplication of efforts; and
WHEREAS, the Participating Members are ready, willing and able to support the development
of this project; and
WHEREAS, NCPA is ready, willing and able to enter into agreements on behalf of the
Participating Members and Non NCPA Members to efficiently and effectively develop and permit the
project;
NOW, THEREFORE BE IT RESOLVED, that the Commission,of the Northern California
PowerAgency hereby approves the proposal and the plan described in the attached Staff Report
authorizing an expenditure of an amount not to exceed $25,000,000 as the combined total expenditures
amount for Second Phase A and Second Phase B activities related to attaining ERCs, project permitting
and further engineering and development of the Lodi Energy Center, the finalization and approval of the
Second Phase Agreement, and the provisions within the Agreement which allow for the participation`of
Non-NCPA Members on an equitable basis with NCPA Members.
FURTHERMORE,the Commission a) approvesthe activities and intent of the Lodi Energy
Center Second Phase Agreement; b) authorizes execution of the Second Phase Agreement on behalf of
NCPA by the NCPA General Managerwith such non -substantive changes as approved by the NCPA
General Counsel; and c) approves the forwarding of the final form of the Second Phase Agreement to
the participating NCPA members and Non-NCPA members to obtain their governing body approvals of
the Lodi Energy Center Second Phase Agreement.
PASSED, ADOPTED and APPROVED this 29th day of November 2007, by the following vote on roll
call:
PATRICK KOLSTAD ATTEST: DENISE DOW
CHAI RMAN ASSISTANT SECRETARY
Vote
Abstained Absent
Alameda
-
BART
y
Biggs
_
Gridley
Healdsburg
Lodi
Y
Lompoc
Y
Palo Alto
Port of Oakland
Redding
Roseville
Santa Clara
`V
Truckee Donner
Turlock
I'
Ukiah
;f
Plumas-Sierra
PATRICK KOLSTAD ATTEST: DENISE DOW
CHAI RMAN ASSISTANT SECRETARY
SECOND PHASE AGREEMENT
FOR
FUNDING THE PLANNING AND DEVELOPMENT
ACTIVITIES
OF THE
LODI ENERGY CENTER
This Second Phase Agreement for Funding the Planning and
Development Activities of the Lodi Energy Center ("this Agreement") by and
between the Northern California Power Agency, a joint powers agency of the
State of California ("NCPA"), those members of NCPA which have individually
executed this Agreement, the Modesto Irrigation District, an Irrigation District
("MID"), the State of California by and through the California Department of
Water Resources ("CDWR"), and the City of Azusa, a municipal corporation
("Azusa"), and such other parties as may be identified in Exhibit C of this
Agreement from time to time (collectively, the "Parties"), is made and entered
into in Roseville, California as of November 29, 2007, and
WITNESSETH:
WHEREAS, the Parties to this Agreement other than NCPA are referred to
herein as "Project Members" and are identified in Exhibit C of this Agreement;
and
WHEREAS, NCPA and the Project Members are interested in developing
additional power generation to meet the future electric demands of the Project
Members and their electric customers; and
1
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
WHEREAS, NCPA proposes to develop a new combined cycle natural
gas generation facility, to be located on property owned by the City of Lodi and
which facility is anticipated to produce at least 255MW capacity ( the "Lodi
Energy Center" or the "Project"); and
WHEREAS, following study and discussion of the findings made to
NCPA Members on August 25, 2005 pursuant to NCPA Commission Resolution
05-16, the members of NCPA requested NCPA staff to prepare an agreement to
continue project development activities; and
WHEREAS, by NCPA Commission Resolution no. 06-48, adopted on
November 30, 2006, the NCPA Commission has previously authorized a form of
second phase agreement for the Lodi Energy Center, together with such non -
substantive changes to that agreement as might be approved by the NCPA
General Counsel; and
WHEREAS, since the adoption of Resolution no. 06-48, additional Project
Members, including MID, CDWR and Azusa, which are not members of NCPA
have expressed a desire to participate in the Lodi Energy Center and substantial
changes have been made to the form of the prior second phase agreement; and
WHEREAS, in accordance with Section 5.2 of that certain Facilities
Agreement executed by and between NCPA and certain of its members dated
September 22, 1993, as amended through February 2, 2007, and included herein
by reference (copies of said Facilities Agreement have been distributed to all
Project Members and NCPA will additionally distribute copies to Project
Members upon request), a project's "second phase" consists of work to be
performed after NCPA completes preliminary investigations and surveys
regarding a project proposal, and before a third phase agreement becomes
effective as to the project's actual financing, construction, operation,
maintenance, and the allocation of rights to a project's output; and
K
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
WHEREAS, to advance the due diligence investigation of the proposed
Lodi Energy Center, to pursue related environmental studies, to investigate,
appraise and attain property rights necessary to develop the Lodi Energy Center
on property owned by the City of Lodi, to perform project planning and design,
to provide working capital for project development and finance, and to engage
necessary expert professional services including those of NCPA staff, the NCPA
Commission and the Project Members hereby declare the Lodi Energy Center to
be an "NCPA Project" as per the terms of the Facilities Agreement', and hereby
enter into this Agreement which is declared to be a "Second Phase Agreement"
under the terms of the Facilities Agreement; and
WHEREAS, MID, while not a member of NCPA, wishes to participate in
the project development by assuming a sixty (60) megawatt share of the Lodi
Energy Center capacity, and to assume its prorated share of the costs and
responsibilities incurred under this Agreement; and
WHEREAS, CDWR, while not a member of NCPA, wishes to participate
in project development by assuming a sixty (60) megawatt share of the Lodi
Energy Center capacity, and to assume its prorated share of the costs and
responsibilities incurred under this Agreement; and
WHEREAS, CDWR is a public agency within the State of California and
its agreements are required by California law to include certain terms, conditions
and certifications; CDWR and NCPA, between them alone and excluding the
other Project Members, are bound by the State of California terms, conditions
and certifications set forth by reference and applicability in Section 19, and
1 Section 1.14 of the Facilities Agreement defines the term "NCPA Project" as meaning any
project which has progressed past the First Phase. Section 5.2 of the Facilities Agreement
provides that for the purpose of ending the First Phase, the NCPA Commission may declare a
termination of investigation regarding a project, or it may declare the project to be an NCPA
Project by entering into a Second Phase agreement or Third Phase agreement with one or more
participants desiring to participate in the project.
91
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Exhibits D and E hereto; and
WHEREAS, Azusa, while not a member of NCPA, wishes to participate in
the project development by assuming a seven (7) megawatt share of the Lodi
Energy Center capacity, and to assume its prorated share of the costs and
responsibilities incurred under this Agreement; and
WHEREAS, NCPA and the Project Members which are members of NCPA
desire to encourage the participation of Project Members which are not members
of NCPA ("Non-NCPA Project Members"), such as MID, CDWR and Azusa, and
such other Non-NCPA Project Members as may be identified in Exhibit C from
time to time, in the Lodi Energy Center, and to provide to them the opportunity
to participate in the governance of the Lodi Energy Center on terms equivalent to
those afforded to Project Members which are NCPA members; and
WHEREAS, NCPA's duties under this Second Phase Agreement will be
performed sequentially in parts as Phase 2A and Phase 2B, with Phase 2A
consisting of the activities listed in Exhibit A attached hereto at a cost not to
exceed sixteen million ($16,000,000) dollars and which may include attaining
Project required ERCs; and
WHEREAS, initiation of the Phase 2B activities consisting of all remaining
Second Phase activities listed in Exhibit A attached hereto, including but not
limited to the purchase of any remaining required air pollution emission credits
and additional engineering and permitting costs, at an estimated additional cost
of up to nine million ($9,000,000) dollars, actions of which will not be undertaken
by NCPA except upon the Project Members' further authorization pursuant to
the terms of this Agreement, and subject to the withdrawal of any Project
Member after the completion of Phase 2A and prior to the initiation of Phase 2B.
NOW THEREFORE, the Parties hereto agree as follows:
4
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Section 1. Obligations - Percentage Participation - Collections and Accounting.
(a) NCPA, on behalf of itself and the Project Members, shall act as the
lead agency for the purpose of representing the Lodi Energy Center in
connection with an Application for Certification to the California Energy
Commission ("CEC"), including Project environmental review, and shall
advance due diligence, perform financial planning, prepare design and
construction documents, investigate, appraise and attain necessary land and land
rights, employ experts, prepare permit documents for the Project, negotiate the
terms and conditions of draft power purchase agreements with NCPA members
and outside entities as necessary, secure vital equipment and emissions credits,
and develop a Third Phase Agreement within the meaning of the Facilities
Agreement satisfactory to NCPA and the Project Members as set forth in Sections
1.(b) and 1.(c) below.
(b) NCPA shall perform services related to the Lodi Energy Center
identified in Exhibit A hereto as Phase 2A activities at a total cost not to exceed
sixteen million ($16,000,000) dollars. Such activities contemplated in Phase 2A
include the evaluation and potential purchase of all or a portion of Project
required ERCs. Project Members may act, pursuant to Section 8 of this
Agreement, to increase Phase 2A activities costs. The Parties anticipate that
Phase 2A activities will be completed by the end of 2008.
(c) Upon the Project Members' authorization, provided pursuant to
Section 3 of this Agreement, to undertake Phase 2B activities, NCPA shall
conduct such additional work as may be necessary, including to secure a CEC
5
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Order approving an Application For Certification of the Lodi Energy Center and
to obtain any further required air emission reduction credits ("ERCs"). Such
work shall be performed at an estimated cost of up to nine million ($9,000,000)
dollars. The Parties anticipate that Phase 2A and Phase 2B activities will be
completed by the end of 2009 at a combined total cost not to exceed twenty-five
million ($25,000,000) dollars.
(d). Each Project Member hereby agrees, upon request by NCPA, to pay
or advance to NCPA, from each Project Member's electric department revenues
or funds only (or in the case of the Bay Area Rapid Transit District ("BART"),
from its tariffs, fees or other sources of revenue, provided that such sources shall
not include any sums derived by from sources the use of which is limited by law
to expenditures other than operating expenses, or in the case of CDWR, from its
Bond Fund and/or System Revenue Account) its respective Project Member
Participation Percentage share of the costs authorized by Project Members in
accordance with this Agreement. Each Project Member further agrees that it will
fix the rates and charges for services provided by its electric department (or in
the case of BART its general revenues, or in the case of CDWR, its bond funding
or billings for payments to the System Revenue Account, subject to the Budget
Contingency Clause cited in Section 21) so that it will at all times have sufficient
funds in its electric department revenue funds to meet this obligation.
(e) Each Project Member's share of Project is initially established according
to the table entitled "Lodi Energy Center Capacity and Participation
Percentages" attached as Exhibit C hereto, as shown in the column entitled Initial
Share of Project Capacity.
The Project Member Participation Percentage and Effective Project
Capacity megawatt subscription of each Project Member shall be revised
6
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
proportionately if more than 216.75 megawatt Project capacity and less than the
full 255 megawatt Project capacity is subscribed as shown in the Initial Project
Capacity column.
The Project Member Participation Percentage and Effective Project
Capacity megawatt subscription of each Project Member shall be revised
proportionately if and when any Project Member withdraws in whole or in part,
provided that the combined total of any such proportionate increases in each
Project Member's Participation Percentage and Effective Project Capacity
megawatt subscription, whether resulting from less than full Project capacity
subscription and or the full or partial withdrawal of any Project Member, shall
not exceed fifteen (15) percent of any Project Member's Initial Project Capacity
subscription and respective Initial Share of Project Capacity. Any Project
Member wholly withdrawing shall thereupon cease to be a Project Member for
all purposes except for purposes of Section 4.
In the event that additional Project Members are added to this Agreement
in accordance with the terms of Exhibit C, the Project Member Participation
Percentage of each Project Member and the respective Effective Project Capacity
such percentage represents, shall be proportionately adjusted downward but in
no case shall such downward adjustment result in any then existing Project
Member receiving less than its Initial Project Capacity subscription in the Project.
(f) From time to time, NCPA shall concurrently demand from each Project
Member its share of Lodi Energy Center Phase 2A and Phase 2B costs. NCPA
shall fix and schedule the total amount payable by each Project Member into a
number of periodic payments and set the dates on which such payments will be
made, and each Project Member agrees to abide by such schedule. NCPA shall
provide a reasonable opportunity for any Project Member to prepay, to make one
payment or to establish an alternative monthly or quarterly periodic prepayment
7
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
schedule to cover its total cost obligation. Any Project Member may arrange to
remit the entirety of its projected financial commitment in one payment, subject
to true up from time to time, based on actual expenditures and such Project
Member's Participation Percentage. Any part of such demand by NCPA which
remains unpaid for sixty (60) calendar days after its billing date shall bear
interest from such sixtieth (60th) day at the prime rate of the Bank of America
then in effect computed on a daily basis plus two (2%) percent until paid.
Interest so assessed and paid shall not change any Project Member's
Participation Percentage or Effective Project Capacity share.
The funds paid by Project Members according to this Section 1 shall be
used to establish a working capital fund for payments by and obligations of
NCPA under this Agreement.
Nothing in this Section 1 shall be construed to prohibit any Project
Member from satisfying its financial commitments from unencumbered funds
otherwise on deposit at NCPA.
(g) NCPA shall maintain a separate fund to account for all monies
received and expended with respect to the Lodi Energy Center. Within such
separate fund, NCPA shall separately account for monies received from and
costs allocated to each Project Member. Interest accruing on funds received from
Project Members in the form of a single payment or a prepayment shall be
credited to the account of such Project Members making the single payment or
prepayment. Each Project Member shall have the right to review or inspect all
financial records with respect to the Lodi Energy Center. Any Project Member
may request an accounting of monies received or expended by NCPA and a copy
of any such accounting shall be made available to all Project Members. Any
Project Member requesting an accounting less than twelve months (12) months
8
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
following the last accounting shall pay for the costs of such accounting. Any
expenses of accounting or other administrative expenses incurred by NCPA shall
be deemed to be Project related costs which shall be borne by the Project
Members.
Section 2. Limited Rights to Participate in Final Implementation and Financing.
(a) Discretion - Disposition of Capacity. In consideration of the
payments provided for in Section 1 of this Agreement, each Project Member
which has not wholly withdrawn and which is not in default, shall have an
exclusive option to enter into a Third Phase Agreement or to enter into a Power
Purchase Agreement, for all or a part of its Project Member Participation
Percentage share of all capacity made available to NCPA from the Project on a
take or pay basis. Any such Third Phase Agreement and or Power Purchase
Agreements shall be consistent with an NCPA Third Phase Agreement as
contemplated by the Facilities Agreement2.
Any Power Purchase Agreement entered into with a Project Member shall
be for not less than the term of any bonds sold to finance the construction of the
Project, shall be entered into concurrently with the approvals by Project
Members entering into the Lodi Energy Center Third Phase Agreement, and
shall be in a form mutually agreed upon by NCPA and the Project Members
choosing to enter into a Power Purchase Agreement.
(b) Increase in Participation Percentage. Any Project Member can, at
2 Section 5.2 of the Facilities Agreement defines Third Phase as all work performed after one or
more participants has contracted with NCPA to participate in the financing, construction,
operation and maintenance, and/or rights to the output, of an NCPA project.
3J
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
the time of entering into a Third Phase Agreement or Power Purchase
Agreement, increase its Project Member Participation Percentage of the Lodi
Energy Center's capacity if additional capacity is available by reason of non -
participation in the Third Phase Agreement or Power Purchase Agreements by
one or more Project Members. Such excess capacity shall be reallocated among
those Project Members which do participate in the same proportion as their
individual shares bear to the total shares of those which do participate. If any
Project Members so entitled to such excess Project capacity do not wish to
contract for their share of such reallocated excess capacity, such remaining
unallocated capacity shall be disposed of as agreed to by the Project Members.
(c) Exercise and Effect of Taking Less than Full Entitlement. Project
Members shall establish the terms and provisions of a Third Phase Agreement
and Purchase Power Agreement for rights to capacity and energy from the
Project prior to the expiration of this Agreement. The Project Members shall also
establish the date by which the Third Phase Agreement or Power Purchase
Agreements must be executed by the Project Members and delivered to NCPA if
they are to participate in the purchase of capacity from the Project. Any Project
Member's failure to execute the Third Phase Agreement or Power Purchase
Agreement for any of such Project Member's total Participation Percentage and
to deliver such agreement to NCPA by the date set for execution or sixty (60)
calendar days after the Project Member's receipt of the Third Phase Agreement
or Purchase Power Agreement, whichever is later, will be an irrevocable decision
on the part of that Project Member not to purchase any such capacity or
otherwise participate in the Project. Execution and delivery of the Third Phase
Agreement or Power Purchase Agreement for less capacity than its original total
Project Member Participation Percentage share, and delivery of that Project
10
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Member's executed Third Phase Agreement or Purchase Power Agreement to
NCPA by the date set for execution or sixty (60) calendar days after Project
Member's receipt of the Third Phase Agreement or Purchase Power Agreement,
whichever is later, will likewise be an irrevocable decision on the part of that
Project Member not to purchase any such capacity in excess of the share set forth
in its delivered agreement.
Supplemental agreements or other agreements will be entered into for the
sale or purchase any excess or surplus Project capacity not allocated pursuant to
the Third Phase Agreement or Purchase Power Agreements as described in the
preceding paragraph. The procedures for processing supplemental agreements
shall be consistent with those prescribed immediately above in this Section 2(c)
for making purchases of capacity. Any Project Member's failure to return an
executed Third Phase Agreement or Power Purchase Agreement for any excess
capacity within the prescribed time period is an irrevocable decision not to
purchase any such excess capacity. A Project Member making any irrevocable
decision not to purchase all of its original Project Participation share of capacity
shall be foreclosed from receiving, and shall be relieved of further burdens
related to, Project capacity which it has declined to purchase and shall be
accordingly relieved of associated further expenses relative to the future
development of the Project, all as of the date of its irrevocable decision.
Section 3. Project Member Direction and Review.
(a) NCPA shall comply with all lawful directions of the Project Members
with respect to this Agreement, while not stayed or nullified, to the fullest extent
authorized by law. Actions, authorizations and approvals of Project Members,
including giving directions, shall be conveyed in writing to NCPA's Project
11
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Manager. Actions, authorizations and approvals, including directions of Project
Members will be taken only by vote of a quorum of authorized representatives of
Project Members at meetings of the NCPA Commission or NCPA Facilities
Committee duly called and held pursuant to the Ralph M. Brown Act. NCPA
shall ensure that all Project Members, including Non-NCPA Project Members,
receive notices, agendas, Project related staff reports, and minutes of all NCPA
Commission and NCPA Facilities Committee meetings in the same manner as
NCPA members.
Ordinarily, voting by representatives of Project Members will be on a one
member/one vote basis, with a majority vote of Project Member representatives
eligible to vote required for action; however, upon request of a Project Member
representative, the voting on any issue will be by Project Member Participation
Percentages with a sixty-five (65%) percent or greater favorable Project Member
Participation Percentage vote necessary to carry the action.
Within ten (10) calendar days following the mailing of notice of any Lodi
Energy Center related NCPA Commission or NCPA Facilities Committee action,
authorization, approval or vote, any Project Member may veto any such action,
authorization, approval or vote of the Project Members that was not taken by a
sixty-five (65%) percent or greater Project Member Participation Percentage vote
by delivering written notice of such veto to NCPA. The notice of veto will nullify
such action, authorization, approval or vote unless, at a meeting of the NCPA
Commission or NCPA Facilities Committee called for the purpose of considering
such veto and held within thirty (30) calendar days after the delivery of such
written notice of veto, Project Members having a combined Project Member
Participation Percentage of at least sixty-five (65%) percent at such time vote to
override the veto.
IN
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
(b) Following the completion of Phase 2A activities and prior to
commencing Phase 2B activities, NCPA shall give the Project Members not less
than thirty (30) calendar days prior written notice of a meeting of the NCPA
Commission at which the Project Members may authorize NCPA to undertake
Phase 2B activities, pursuant to the procedures in Section 3(a) of this Agreement.
Section 4. Conditional Repayment to Project Members.
The Parties anticipate that bonds may be issued after the commencement
of Phase 2 for Project purposes, including the reimbursement of Project member
payments and advances made during Phase 2 and any subsequent Phases.
All payments and advances made heretofore, and those hereafter made
pursuant to Section 1 of this Agreement, excluding interest paid on delinquent
payments, shall be repaid to each of the Project Members making such payments
and advances pursuant to this Agreement out of the proceeds of the first
issuance of the Project bonds which can, as determined by NCPA, economically
provide therefor, or as and when there are sufficient funds available from partial
sale of bonds, if bonds, notes, or other evidences of indebtedness are issued to
support the Project. Such reimbursements shall be made within sixty (60)
calendar days following the sale of any Project bonds and shall include interest
on Project Member payments and advances computed monthly at a rate
equivalent to the end of the month reference rate of the Bank of America. Any
interest due NCPA under Section 1 of this Agreement and unpaid shall be
deducted from the repayment to the respective Project Members which owe such
interest to NCPA.
If NCPA determines to complete the Project, but is not successful in
obtaining all necessary approvals and financing therefor, there shall be no
13
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
reimbursement to Project Members except for proportionate reimbursement to
Project Members out of any remaining unused Project funds including those
monies then in the capital fund, along with all other receipts to which NCPA is
entitled in connection with the Project. Any ERCs purchased as authorized by
Section 1(c) of this Agreement but not utilized either because the Project is not
successful in obtaining all necessary financing or government approvals or as
may be in excess of ERCs required, shall be re -sold by NCPA and the proceeds
distributed proportionately among the Project Members.
This Section 4 shall survive the termination of this Agreement and
execution of a Third Phase Agreement and any Purchase Power Agreements.
Section 5. Term.
The Effective Date of this Agreement shall be the next calendar day after
formal approval by the governing bodies of Project Members holding eighty-five
(85%) percent of the Initial Share of Project Capacity as set out in Exhibit C of this
Agreement, or such later date as may be determined by Project Members after an
adjustment in the Lodi Energy Center Participation Percentages to provide for an
adequate subscription for the financial commitment required by Section 6 of this
Agreement is attained. This Agreement shall be superseded by the Third Phase
Agreement and any Purchase Power Agreements except that Section 4 shall
remain in effect.
14
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Section 6. Financial Commitments.
To fund the Project Phase 2A activities each Project Member agrees to a
total financial commitment equal to its respective Project Member Participation
Percentage of a total of sixteen million ($16,000,000) dollars. Upon completion of
Phase 2A activities, or at any time deemed appropriate by a favorable vote as
provided in Section 3 of this Agreement, Project Members may authorize the
financial commitment to support the completion of Project Phase 2B activities, as
referenced in Section 1(c); subject to the provisions of Section 8 of this
Agreement.
Section 7. NCPA Assignment of Right to Receive Payments.
(a) Notwithstanding any other provision of this Agreement, if NCPA
requires funds to carry out the terms of this Agreement prior to the receipt of
adequate funds from the Project Members, NCPA may assign its right to receive
any payments under this Agreement to a bank or other financial institution to
secure a loan by NCPA or in exchange for an amount of money equal to the then
present value of those payments as determined by NCPA. Project Members
hereby consent to such assignment and upon notification in writing by NCPA to
each Project Member; each such Project Member will make each such assigned
payment directly to the assignee. The assignee shall not be liable to Project
Members for the amounts as assigned, and NCPA shall use the proceeds of such
borrowing or assignment solely for the purposes provided in this Agreement.
This Section 7(a) does not apply to the CDWR, which is governed by State of
California contracting and fiscal rules that do not authorize such assignments
without additional fiscal and contracting requirements being met.
INS
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
If the amount of CDWR's payments are less, or become less, than its
Project Member Participation Percentage share of Project expenditures, CDWR
shall be invoiced an amount sufficient to meet its then assessed Project Member
Participation Percentage share and it shall pay such invoice within ninety (90)
calendar days of the date such invoice was received. If no payment is received
from CDWR, CDWR's Project Member Participation Percentage share shall be
reduced proportionately, and the corresponding amount of CDWR's Project
Member Participation Percentage reduction shall be reallocated proportionately
to the other Project Members.
If an assignment or CDWR reallocation is made under Section 7 of this
Agreement, then upon the failure of any Project Member to make any
corresponding payment assigned, the Project Member Participation Percentages
of each non -defaulting Project Member shall be automatically proportionately
increased for the term of the assignment, and the defaulting Project Member's
Participation Percentage shall (but only for purposes of computing the respective
Project Member Participation Percentages of the non -defaulting Project
Members) be reduced correspondingly; provided that the combined sum of any
such increase(s) due to a defaulting Project Member, a full or partial Project
Member withdrawal, and or CDWR reallocation for any non -defaulting Project
Member shall not exceed, without the written consent of each non -defaulting
Project Member, an accumulated maximum of twenty-five (25%) percent of the
non -defaulting Project Member's Initial Share of Project Capacity as shown in
Exhibit C hereto.
If a Project Member fails or refuses to pay any amounts due to NCPA, the
fact that other Project Members increase their obligations to make such payments
shall not relieve the defaulting Project Member of its liability for such payments
and any Project Member increasing its obligation shall have a right of recovery
16
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
from the defaulting Project Member to the extent of its respective increased
obligation, in addition to the rights of NCPA discussed in the following
paragraphs.
In addition, NCPA may terminate the provisions of this Agreement
insofar as they entitle the defaulting Project Member to its Project Member
Participation Percentage share of Project output.
In addition, NCPA shall have all rights and remedies under law or equity
to compel payment of funds owed to NCPA by Project Members.
(b) For the purposes of such assignment, NCPA may fix and schedule the
total amount payable by each Project Member into any number of periodic
payments, and the dates on which such payments will be made, and each Project
Member agrees to abide by such schedule. NCPA shall provide a reasonable
opportunity for any Project Member to prepay, to make one payment, or to
establish an alternative mutually agreeable payment schedule to cover its total
obligation.
(c) After such an assignment is made, no Project Member may avoid the
obligation so assigned by withdrawal or reduction in participation pursuant to
Section 8 of this Agreement or otherwise.
(d) If NCPA makes an assignment pursuant to Section 7 of this
Agreement, it may transfer, subject to Project Member authorization, any or all of
its rights and duties to a nonprofit corporation formed to act on behalf of NCPA
and if the voting method of the members of such nonprofit corporation is in the
same manner as that provided in Sections 3 and 9 of this Agreement.
IVA
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Section 8. Withdrawal from Further Participation.
(a) Except for increases in a Project Member's financial obligation as
provided in Section 7 of this Agreement, if at any time following the execution of
this Agreement, NCPA becomes aware of a required or estimated increase in
Phase 2A financial commitments beyond that contemplated in Section 6, NCPA
shall inform the Project Members of the reasons and amount of such required or
estimated financial increase no later than at the next scheduled meeting of Project
Members. After being noticed of such required or estimated increases in
financial commitments, Project Members may partially withdraw, (i.e., withdraw
from participation in the increase only), or may withdraw wholly from the Lodi
Energy Center, and Project Members shall notice NCPA in writing of their
decision to accept such increase, to partially withdraw, or to wholly withdraw
from Project participation. Any Project Member(s) withdrawal shall be subject to
honoring any commitments made by them or on their behalf pursuant to
authorization of this Agreement up to the day of NCPA's receipt of such Project
Member's written notice of withdrawal, in part or in whole, within thirty (30)
calendar days of the Project Member(s) receipt of the notice of the increase from
NCPA.
(b) A Project Member may, by providing written notice to NCPA,
withdraw completely from the Project or reduce its participation percentage
following the notification from NCPA pursuant to Section 3(b) of this Agreement
that Phase 2A has been completed and prior to a Project Member's authorization
to proceed with Phase 2B activities. In this event the Project Members may vote
to consider modifications to this Agreement.
IE:3
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Section 9. Voting Rights and Duration.
A Project Member is eligible to vote pursuant to Section 3 of this
Agreement until it completely withdraws from the Lodi Energy Center Project. If
a Project Member's Project Member Participation Percentage is reduced, after
such reduction, its subsequent financial commitment will be adjusted
accordingly to match such Project Member's reduced Project Member
Participation Percentage share. When the Third Phase Agreement and or Power
Purchase Agreements are executed, or revised, Project Member Participation
Percentages for voting shall be established or reestablished by dividing the
amount of Project capacity to be purchased by each Project Member that is a
party to the Third Phase Agreement and or Power Purchase Agreements by the
total amount of the Project capacity.
Section 10. Quorum Defined.
The presence of either a majority of Project Members, or of Project
Members then having a combined Project Member Participation Percentages of
at least sixty-five (65%) percent, shall constitute a quorum for the purpose of
action.
Section 11. Indemnification.
Each Project Member agrees to indemnify, defend and hold harmless
NCPA and its members, and the other Project Members, including their
respective governing officials, officers, agents, and employees, from and against
any and all claims, suits, losses, costs, damages, expenses and liability of any
19
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
kind or nature, including, without limitation, reasonable attorneys' fees
("Claims") to the extent caused by any breach of contract, negligence, gross
negligence or willful misconduct of itself and its officers, employees,
subcontractors or agents, to the maximum extent permitted by law, but only as to
Claims arising out of or related to this Agreement.
Section 12. Default and Remedies
(a) The failure of any Project Member to meet its financial commitments as
required by this Agreement shall constitute a default. In the event of such a
default, NCPA shall deliver a ten (10) calendar day written notice to the
defaulting Project Member to cure the default. If such default is not cured within
that time NCPA shall pursue all rights, under law and equity, to collect all sums
due.
(b) Any action brought to enforce any provision of this Agreement shall be
filed in the County of Sacramento, subject to the binding arbitration provision set
forth below.
(c) ANY DISPUTE REGARDING THE PERFORMANCE OF THIS
AGREEMENT, OR THE LACK THEREOF, SHALL BE RESOLVED THROUGH
BINDING ARBITRATION CONDUCTED BY A MUTUALLY AGREEABLE
ARBITRATOR, OR IF NO AGREEMENT CAN BE REACHED, THEN
THROUGH THE AUSPICES OF THE AMERICAN ARBITRATION
ASSOCIATION. THE PARTIES HERETO UNDERSTAND THAT BY
AGREEING TO THIS PROVISION THEY ARE SURRENDERING ANY
JUDICIAL REMEDIES THAT MAY OTHERWISE BE AVAILABLE.
PA
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
NCPA PROJECT MEMBER
(d) Should any actions be necessary to enforce any provision of this
Agreement the prevailing party shall be entitled to the recovery of reasonable
costs and reasonable attorney fees.
Section 13. Notices
Any notice, demand or request required or authorized by this Agreement
to be given to any party shall be in writing (excluding emails and faxes) and shall
either be personally delivered to Project Member's designated representative and
the Secretary of NCPA or transmitted to the Project Member's official mailing
address as listed in Exhibit B to this Agreement by sending such notice by U.S.
Mail, first class postage prepaid. All such notices shall be deemed received
within two (2) business days after deposit in the U.S. mail. Any party may
change the address for notice by providing written notice of such change to
NCPA and the other Project Members.
Section 14. Counterparts
This Agreement may be executed in any number of counterparts, and each
executed counterpart shall have the same force and effect as the original
instrument as if all the signatories to all of the counterparts had signed the same
instrument.
21
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Section 15. Amendment
No amendment or variation of the terms of this Agreement shall be valid
unless made in writing, signed by the Parties and approved as required. No oral
understanding or Agreement not incorporated in writing in the Agreement is
binding on any of the parties.
Section 16. Unenforceable Provision
In the event that any provision of this Agreement is unenforceable or held
to be unenforceable, then the Parties agree that all other provisions of this
Agreement have force and effect and shall not be affected thereby.
Section 17. Governing Law.
This Agreement shall be governed by the law of the State of California.
Section 18. Construction.
Each party to this Agreement is sophisticated in the operation of electric
utilities, and in the construction and financing of power generation facilities.
Each party to this Agreement was represented by counsel during the negotiation
of this Agreement. Hence, this Agreement shall be interpreted as being equally
drafted by all Parties and without reference to Civil Code section 1654 requiring
interpretation against parties causing an ambiguity.
PX
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Section 19: Special Provisions Applying to CDWR and NCPA Only.
The State of California General Terms and Conditions and Certification
Clauses, as shown in Exhibits D and E and known as GTC-307 and CCC -307,
respectively, are incorporated in this agreement. GTC-307 and CCC -307 apply
only to CDWR and NCPA concerning this Agreement.
Section 20: State of California Requirements for State Agencies
CDWR's participation in this Agreement is subject to the requirements of
the California Public Contract Code, and Articles therein, beginning with
Sections 10295 and 10335, respectively.
Section 21: State of California Budget Contingency Clause.
Funding for the Phase 2A and Phase 2B activities are continuously
appropriated to the State Water Resources Development System and are not
subject to annual legislative appropriation. CDWR represents that all funds for
use in Phase II will be from this fund. If the foregoing is changed by legislative
action or Executive Branch policy in a manner which prevents further CDWR
Project Participation funding, the following will apply: , CDWR shall have no
liability to pay any additional funds whatsoever to NCPA or to furnish any other
considerations under this Agreement Given such occurrence, CDWR's
Participation Percentage will be revised consistent with total Project payments
made to date by CDWR and Section 7 of this Agreement.
PAI
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Section 22: Department of General Services Review.
The Parties to this Agreement acknowledge that this Agreement, as
between CDWR and NCPA, must be reviewed and approved by the Director of
the Department of General Services, or his designee, before it becomes of full
force and effect. CDWR shall provide a letter opinion from CDWR Counsel
indicating that Department of General Services review and approval of this
Agreement has occurred and that all relevant procedural requirements for State
contracting have been met.
Section 23: Exhibits
This Agreement includes the following Exhibits:
Exhibit A: Activities to be undertaken in Phase 2A
Exhibit B: Addresses for Notice
Exhibit C: Lodi Energy Center Member Participation Percentages
Exhibit D: General Terms and Conditions
Exhibit E: Certification Clauses
IN WITNESS WHEREOF, each Project Member has executed this
Agreement with the approval of its governing body, and NCPA has executed
this Agreement in accordance with the authorization of its Commission
NORTHERN CALIFORNIA
POWER AGENCY
By:
Date:
24
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
MEMBERS OF THE NORTHERN CALIFORNIA POWER AGENCY:
BAY AREA RAPID TRANSIT
By:
Date:
CITY OF BIGGS
By:
Date:
CITY OF GRIDLEY
By:
Date:
CITY OF HEALDSBURG
By:
Date:
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Approved as to Legal Form
By:
Approved as to Legal Form
By:
Approved as to Legal Form
By:
Approved as to Legal Form
By:
Q1
CITY OF LODI
By:_
Date:
CITY OF LOMPOC
Approved as to Legal Form
Approved as to Legal Form
By: By:
Date:
PLUMAS-SIERRA RURAL ELECTRIC Approved as to Legal Form
COOPERATIVE
By: By:
Date:
CITY OF SANTA CLARA
By:
Date:
CITY OF UKIAH
By:
Date:
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Approved as to Legal Form
By:
Approved as to Legal Form
By:
Q'i
NON-MEMBERS OF THE NORTHERN CALIFORNIA POWER AGENCY:
MODESTO IRRIGATION DISTRICT
By:
Date:
Approved as to Legal Form
By:
STATE OF CALIFORNIA DEPARTMENT OF WATER RESOURCES with
respect to its powers and responsibilities for the State Water Resources Development
System
Bv:
Raphael A. Torres, Deputy Director
Da
Approved as to form and legal sufficiency
IRa
David A. Sandino, Chief Counsel
Date:
CITY OF AZUSA
By:
Date:
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Approved as to Legal Form
By:
NA,
Exhibit A
PHASE 2A ACTIVITIES INCLUDE
• Finalize Phase 2 Project Participant Agreement
• Achieve Phase 2 Agreement execution by all Participants
• Establish Project Participant Committee
• Establish Project Development support and reporting infrastructure
• Establish Project Parameters (duct firing, future expandability, etc.)
• Investigate, appraise and attain necessary land and land rights from the
City of Lodi
• Perform environmental assessments
• Submit application to CEC
• Purchase or secure options for Project ERCs
Phase 2A are activities anticipated to be completed by end of 2008.
PHASE 2B ACTIVITIES INCLUDE
• Complete CEC process
• Exercise ERC options or fully secure any remaining necessary ERCs
• Develop Phase III and /or PPA agreements for Project commitment and
financing
• Develop Project Operations Agreement
• Develop Project fuel supply arrangements
• Commence Project detailed engineering and design
• Execute Project Phase III and or PPA agreements
• Release bid for construction (Q12010)
• Commence construction (Q2 2010)
Phase 2B are activities anticipated to be completed by end of 2009
K-41
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Exhibit B
PROJECT PARTICPANT ADDRESSES FOR NOTICE
Northern California Power Agency
Northern California Power Agency
Attn: Ed Warner, Lodi Energy Center Manager
180 Cirby Way
Roseville, California, 95678
Telephone: (209)728-1387 x-22 or (209)768-5887
Facsimile:
Email: Ed.Warner@ncpagen.com
City of Azusa
City of Azusa
Azusa Light & Water Department
Attn: Bob Tang, Assistant Director Resource Management
729 N. Azusa Avenue
P.O. Box 9500
Azusa, California 91702-9500
Telephone: (626)812-5214
Facsimile: (626)334-3163
Email: btang@ci.azusa.ca.us
Bay Area Rapid Transit District
Bay Area Rapid Transit District
Attn: Frank Schultz, Power Resources Manager
300 Lakeside Drive, 16th Floor
Oakland, California 94612-3534
Telephone: (510)464-6435
Facsimile: (510)464-6118
Email: fschult@bart.gov
Modesto Irrigation District
Modesto Irrigation District
Attn: Gregory Salyer, P.E.,
Resource Planning and Development Manager
P.O. Box 4060
1231 Eleventh Street
Modesto, California 95352
Telephone: (209)526-7550
Facsimile: (209)526-7575
PA
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Email: gregs@mid.org
California Department of Water Resources:
Department of Water Resources
Attention: Chi Doan
Chief, Power Contracts Management Branch
3310 El Camino Avenue, LL90
Sacramento, California 95821
Telephone: (916) 574-0612
Facsimile: (916) 574-0660
Plumas-Sierra Rural Electric Cooperative
Plumas-Sierra REC
Attn: Bob Marshall, General Manager
73233 Highway 70
Portola, California 96122-7064
Telephone: (530)832-4261
Facsimile: (530)832-6070
Email: marshall@psln.com
City of Biggs
City of Biggs
Attn: Pete Carr, City Administrator
465 "C" Street
P.O. Box 307
Biggs, California 95917-0307
Telephone: (530)868-5493
Facsimile: (530)868-5239
Email: bi sg 1@bis-ca.gov
City of Gridley
City of Gridley
Attn: Jack Slota, City Administrator
685 Kentucky Street
Gridley, California 95948-2117
Telephone: (530)846-5695
Facsimile: (530)846-3229
Email: jslota@gridley.ca.us
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
City of Healdsburg
City of Healdsburg
Attn: Bill Duarte, Electric Utility Director
435 Allan Court
Healdsburg, California 95448
Telephone: (707)431-3346
Facsimile: (707)431-2710
Email: bduarte@ci.healdsbure.ca.us
City of Lodi
City of Lodi
Attn: George Morrow, Utility Director
221 W. Pine Street
Lodi, California 95240
Telephone: (209)333-6762
Facsimile: (209)333-6839
Email: gmorrow@lodielectric.com
City of Lompoc
City of Lompoc
Attn: Ronald Stassi, Utility Director
100 Civic Center Plaza
P.O. Box 8001
Lompoc, California 93438-8001
Telephone: (805)875-8299
Facsimile: (805)875-8399
Email: rstassi@ci.lompoc.ca.us
Silicon Valley Power
Silicon Valley Power
Attn: John Roukema, Electric Utility Director
1500 Warburton Avenue
Santa Clara, California 95050
Telephone: (408)261-5490
Facsimile: (408)249-0217
Email: jroukema@siliconvalleypower.com
31
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
City of Ukiah
City of Ukiah
Attn: Elizabeth Kirkley, Interim Utility Director
300 Seminary Avenue
Ukiah, California 95482
Telephone: (707)463-6298
Facsimile: (707)463-6740
Email: ekirkley@cityofukiah.com
Power and Water Resources Purchasing Authority
Power and Water Resources Purchasing Authority
Attn: Kent W. Palmerton, General Manager
2106 Homewood Way, Ste 100
Carmichael, California 95608
Telephone: (916) 483-5368
Facsimile: (916) 485-3537
Email: kent@wkpalmerton.com
Kia
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
Exhibit C
LODI ENERGY CENTER MEMBER PARTICIPATION PERCENTAGES
Upon approval of the NCPA Commission, this Exhibit C may be amended to add Project
Members, which shall thereafter and upon execution of this Agreement, be considered a
party to this Agreement, without requiring the consent of then current Project Members
provided that:
1. Total existing Initial Project Capacity subscription is less than 255MW capacity.
2. The sum of (a) the existing Initial Project Capacity subscription plus (b) the proposed
added Project Member's requested Project capacity does not exceed 255MW
capacity.
3. The added Project Member bears its full proportionate share of costs incurred prior to
its addition to this Agreement as a Project Member.
4. No existing Project Member shall have its Initial Share of Project Capacity reduced by
such addition.
5. Upon addition of a new Project Member, the Effective Project Capacity and Member
Participation Percentages, and other values reflected in this Exhibit C shall be
recalculated and updated accordingly.
6. Any new Project Member shall execute a counterpart of this Agreement, and shall be
deemed to be bound as of the Effective Date of this Agreement.
11/15/2007
Lodi Energy
Center Capacity and Participation Percentages
Total Project Capacity
255 mW
Given Capacity and Percentage Adjustments per
terms of A reement
Initial Project
Project Member Capacity mW
Initial Share of
Subscribed
Capacity - mW
Initial Share of
Project Capacity Effective Project
mW % Capacity mW
Effective Share
of Subscribed
mW %
Project Member
Participation
Percenta e
Azusa
7
2.8%
2.7%
7.17
2.8%
2.8%
BART
15
6.0%
5.9%
15.36
6.0%
6.0%
Biggs
1
0.4%
0.4%
1.02
0.4%
0.4%
CDWR
60
24.1%
23.5%
61.45
24.1%
24.1%
Gridley
5
2.0%
2.0%
5.12
2.0%
2.0%
Healdsburg
4
1.6%
1.6%
4.10
1.6%
1.6%
Lodi
30
12.0%
11.8%
30.72
12.0%
12.0%
Lompoc
5
2.0%
2.0%
5.12
2.0%
2.0%
Modesto
60
24.1%
23.5%
61.45
24.1%
24.1%
Plumas-Sierra
2
0.8%
0.8%
2.05
0.8%
0.8%
PWRPA
5
2.0%
2.0%
5.12
2.0%
2.0%
Silicon Valley Power
50
20.1%
19.6%
51.20
20.1%
20.1%
Ukiah
5
2.0%
2.0%
5.12
2.0%
2.0%
Total
249
100.0%
97.6%
255
100.0%
100.0%
0
IN
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
EXHIBIT D
THIS EXHIBIT D CONTAINS THE STATE OF CALIFORNIA GTC 307. GTC 307
CONTAINS EIGHTEEN (18) TERMS AND CONDITIONS ALL OF WHICH ARE INCLUDED
BY REFERENCE AND MADE OF PART OF THIS AGREEMENT. GTC 307 APPLIES
TO THIS AGREEMENT ONLY WITH RESPECT TO NC PA AND CDWR AND AS ACCEPTED,
MODIFIED OR DESCRIBED BY PROVISION BELOW.
1)
2)
3)
4)
5)
APPROVAL - ACCEPTED.
AMENDMENT - ACCEPTED AND INCLUDED AS SECTION 15.
ASSIGNMENT — ACCEPTED AS PROVIDED IN SECTION 7 OF THIS AGREEMENT.
AUDIT - ACCEPTED.
INDEMNIFICATION - NOT APPLICABLE. THE CALIFORNIA
GOVERNMENT CODE ALLOWS CALIFORNIA PUBLIC BODIES,
INCLUDING STATE AGENCIES, TO ALLOCATE RISK.
6) DISPUTES - ACCEPTED.
7) TERMINATION FOR CAUSE - NOT APPLICABLE ON SAME BASIS AS
10)
11)
12)
13)
14)
15)
16)
17)
18)
PROVISION 5 ABOVE.
INDEPENDENT CONTRACTOR - ACCEPTED.
RECYCLING CERTIFICATION - NOT APPLICABLE AS PRODUCTS,
MATERIALS, GOODS OR SUPPLIES ARE NOT BEING OFFERED FOR SALE TO THE
STATE OR CDWR.
NON-DISCRIMINATION CLAUSE - ACCEPTED.
CERTIFICATION CLAUSES - ACCEPTED AS DESCRIBED IN EXHIBIT E.
TIMELINESS - ACCEPTED.
COMPENSATION - ACCEPTED NOTING THAT IF THE SITUATION ARISES THAT
C DWR'S TOTAL PAYMENTS MADE TO NC PA UNDER THIS AGREEMENT ARE LESS
THAN THE TOTAL PAYMENTS ASSESSED TO CDWR BASED ON C DWR'S PROJECT
PERCENTAGE CONTAIN IN EXHIBIT C, C DWR'S PROJECT PERCENTAGE SHALL
BE REDUCED ACCORDINGLY CONSISTENT WITH SECTION 7 OF THIS AGREEMENT.
GOVERNING LAW - ACCEPTED AND INCLUDED AS SECTION 17.
ANTITRUST CLAIMS - NOT APPLICABLE.
CHILD SUPPORT COMPLIANCE ACT - ACCEPTED.
UNENFORCEABLE PROVISION — ACCEPTED AND INCLUDED AS SECTION 16.
PRIORITY HIRING CONSIDERATION - NOT APPLICABLE TO THIS
AGREEMENT AND AS NC PA IS NOT SPECIFICALLY HIRING ADDITONAL STAFF
PERFORM THE FUNCTIONS CONTEMPLATED BY NC PA UNDER THIS AGREEMENT.
State of California GTC 307
GENERAL TERMS AND CONDITIONS
1. APPROVAL: This Agreement is of no force or effect until signed by both parties and
approved by the Department of General Services, if required. Contractor may not
commence performance until such approval has been obtained.
34
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
2. AMENDMENT: No amendment or variation of the terms of this Agreement shall be
valid unless made in writing, signed by the parties and approved as required. No oral
understanding or Agreement not incorporated in the Agreement is binding on any of the
parties.
3. ASSIGNMENT: Superseded by Section 7 of this Agreement.
4. AUDIT: Contractor agrees that the awarding department, the Department of General
Services, the Bureau of State Audits, or their designated representative shall have the
right to review and to copy any records and supporting documentation pertaining to the
performance of this Agreement. Contractor agrees to maintain such records for possible
audit for a minimum of three (3) years after final payment, unless a longer period of
records retention is stipulated. Contractor agrees to allow the auditor(s) access to such
records during normal business hours and to allow interviews of any employees who
might reasonably have information related to such records. Further, Contractor agrees to
include a similar right of the State to audit records and interview staff in any subcontract
related to performance of this Agreement. (Gov. Code §8546.7, Pub. Contract Code
§10115 et seq., CCR Title 2, Section 1896).
6. DISPUTES: Contractor shall continue with the responsibilities under this Agreement
during any dispute.
7. TERMINATION FOR CAUSE: Superseded by Section 7 of this Agreement.
8. INDEPENDENT CONTRACTOR: Contractor, and the agents and employees of
Contractor, in the performance of this Agreement, shall act in an independent capacity
and not as officers or employees or agents of the State.
10. NON-DISCRIMINATION CLAUSE: During the performance of this Agreement,
Contractor and its subcontractors shall not unlawfully discriminate, harass, or allow
harassment against any employee or applicant for employment because of sex, race,
color, ancestry, religious creed, national origin, physical disability (including HIV and
AIDS), mental disability, medical condition (cancer), age (over 40), marital status, and
denial of family care leave. Contractor and subcontractors shall insure that the evaluation
and treatment of their employees and applicants for employment are free from such
discrimination and harassment. Contractor and subcontractors shall comply with the
provisions of the Fair Employment and Housing Act (Gov. Code § 12990 (a -f) et seq.)
and the applicable regulations promulgated thereunder (California Code of Regulations,
Title 2, Section 7285 et seq.). The applicable regulations of the Fair Employment and
Housing Commission implementing Government Code Section 12990 (a -f), set forth in
Chapter 5 of Division 4 of Title 2 of the California Code of Regulations, are incorporated
into this Agreement by reference and made a part hereof as if set forth in full. Contractor
W
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
and its subcontractors shall give written notice of their obligations under this clause to
labor organizations with which they have a collective bargaining or other Agreement.
Contractor shall include the nondiscrimination and compliance provisions of this clause
in all subcontracts to perform work under the Agreement.
11. CERTIFICATION CLAUSES: The CONTRACTOR CERTIFICATION CLAUSES
contained in the document CCC 307 are hereby incorporated by reference and made a
part of this Agreement by this reference as if attached hereto.
12. TIMELINESS: Time is of the essence in this Agreement.
13. COMPENSATION: The consideration to be paid Contractor, as provided herein,
shall be in compensation for all of Contractor's expenses incurred in the performance
hereof, including travel, per diem, and taxes, unless otherwise expressly so provided.
14. GOVERNING LAW: This contract is governed by and shall be interpreted in
accordance with the laws of the State of California.
16. CHILD SUPPORT COMPLIANCE ACT: "For any Agreement in excess of
$100,000, the contractor acknowledges in accordance with Public Contract Code 7110,
that:
a). The contractor recognizes the importance of child and family support obligations and
shall fully comply with all applicable state and federal laws relating to child and family
support enforcement, including, but not limited to, disclosure of information and
compliance with earnings assignment orders, as provided in Chapter 8 (commencing with
section 5200) of Part 5 of Division 9 of the Family Code; and
b) The contractor, to the best of its knowledge is fully complying with the earnings
assignment orders of all employees and is providing the names of all new employees to
the New Hire Registry maintained by the California Employment Development
Department."
17. UNENFORCEABLE PROVISION: In the event that any provision of this Agreement
is unenforceable or held to be unenforceable, then the parties agree that all other
provisions of this Agreement have force and effect and shall not be affected thereby.
K�1
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
EXHIBIT E
THIS EXHIBIT E CONTAINS THE STATE OF CALIFORNIA CCC 307. CCC 307
CONTAINS SEVEN (7) PROVISIONS PERTAINING TO CONTRACTOR CERTIFICATION
CLAUSES AND EIGHT (H) PROVISIONS PERTAINING TO DOING BUSINESS WITH THE
STATE OF CALIFORNIA, ALL OF WHICH ARE INCLUDED FOR REFERENCE. CCC 307
APPLIES TO THIS AGREEMENT ONLY WITH RESPECT TO NCPA AND CDWR AND AS
ACCEPTED, MODIFIED OR DESCRIBED BY PROVISION BELOW.
CONTRACTOR CERTIFICATION CLAUSES
1) STATEMENT OF COMPLIANCE - NOT APPLICABLE, NCPA IS A PUBLIC
ENTITY.
2) DRUG-FREE WORKPLACE REQUIREMENTS - ACCEPTED.
3) NATIONAL LABOR RELATIONS BOARD CERTIFICATION - NOT
APPLICABLE, NCPA IS A PUBLIC ENTITY.
4) CONTRACT FOR LEGAL SERVICES $50, 000 OR MORE- PRO BONO
REQUIREMENT - NOT APPLICABLE; NCPA IS NOT PERFORMING LEGAL
SERVICES FOR CDWR.
5) EXPATRIATE CORPORATIONS - ACCEPTED.
6) SWEATFREE CODE OF CONDUCT - NOT APPLICABLE, NCPA IS NOT
FURNISHING ANY APPARAL, GARMENTS OR CORRESPONDING ACCESSORIES TO
CDWR.
7) DOMESTIC PARTNERS - NOT APPLICABLE WAIVED PER PUBLIC
CONTRACT CODE SECTION 10295.3 (C) (4) .
CCC -307
CERTIFICATION
I, the official named below, CERTIFY UNDER PENALTY OF PERJURY that I am duly
authorized to legally bind the prospective Contractor to the clause(s) listed below. This
certification is made under the laws of the State of California.
Contractor/Bidder Firm Name (Printed)
Federal ID Number
By (Authorized Signature)
Printed Name and Title of Person Signing
Date Executed
Executed in the County of
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
CONTRACTOR CERTIFICATION CLAUSES
2. DRUG-FREE WORKPLACE REQUIREMENTS: Contractor will comply with the
requirements of the Drug -Free Workplace Act of 1990 and will provide a drug-free
workplace by taking the following actions:
a. Publish a statement notifying employees that unlawful manufacture, distribution,
dispensation, possession or use of a controlled substance is prohibited and specifying
actions to be taken against employees for violations.
b. Establish a Drug -Free Awareness Program to inform employees about:
1) the dangers of drug abuse in the workplace;
2) the person's or organization's policy of maintaining a drug-free workplace;
3) any available counseling, rehabilitation and employee assistance programs; and,
4) penalties that may be imposed upon employees for drug abuse violations.
c. Every employee who works on the proposed Agreement will:
1) receive a copy of the company's drug-free workplace policy statement; and,
2) agree to abide by the terms of the company's statement as a condition of employment
on the Agreement.
Failure to comply with these requirements may result in suspension of payments under
the Agreement or termination of the Agreement or both and Contractor may be ineligible
for award of any future State agreements if the department determines that any of the
following has occurred: the Contractor has made false certification, or violated the
certification by failing to carry out the requirements as noted above. (Gov. Code §8350 et
seq.)
5. EXPATRIATE CORPORATIONS: Contractor hereby declares that it is not an
expatriate corporation or subsidiary of an expatriate corporation within the meaning of
Public Contract Code Section 10286 and 10286. 1, and is eligible to contract with the
State of California.
7. DOMESTIC PARTNERS: For contracts over $100,000 executed or amended after
January 1, 2007, the contractor certifies that contractor is in compliance with Public
Contract Code section 10295.3.
DOING BUSINESS WITH THE STATE OF CALIFORNIA
1) CONFLICT OF INTEREST - ACCEPTED.
2) LABOR CODE/WORKERS' COMPENSATION - ACCEPTED.
3) AMERICANS WITH DISABILITIES ACT - ACCEPTED.
4) CONTRACTOR NAME CHANGE - ACCEPTED.
5) CORPORATE QUALIFICATIONS TO DO BUSINESS IN CALIFORNIA -
NOT APPLICABLE, NCPA IS NOT A CORPORATION.
6) RESOLUTION - ACCEPTED.
7) AIR OR WATER POLLUTION VIOLATION - ACCEPTED.
8) PAYEE DATA RECORD FORM STD. 204 - NOT APPLICABLE, NCPA IS A
GOVERNMENTAL ENTITY.
38
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
DOING BUSINESS WITH THE STATE OF CALIFORNIA
The following laws apply to persons or entities doing business with the State of
California.
1. CONFLICT OF INTEREST: Contractor needs to be aware of the following provisions
regarding current or former state employees. If Contractor has any questions on the
status of any person rendering services or involved with the Agreement, the awarding
agency must be contacted immediately for clarification.
Current State Employees (Pub. Contract Code § 10410):
1). No officer or employee shall engage in any employment, activity or enterprise from
which the officer or employee receives compensation or has a financial interest and
which is sponsored or funded by any state agency, unless the employment, activity or
enterprise is required as a condition of regular state employment.
2). No officer or employee shall contract on his or her own behalf as an independent
contractor with any state agency to provide goods or services.
Former State Employees (Pub. Contract Code §10411):
1). For the two-year period from the date he or she left state employment, no former state
officer or employee may enter into a contract in which he or she engaged in any of the
negotiations, transactions, planning, arrangements or any part of the decision-making
process relevant to the contract while employed in any capacity by any state agency.
2). For the twelve-month period from the date he or she left state employment, no former
state officer or employee may enter into a contract with any state agency if he or she was
employed by that state agency in a policy-making position in the same general subject
area as the proposed contract within the 12 -month period prior to his or her leaving state
service.
If Contractor violates any provisions of above paragraphs, such action by Contractor shall
render this Agreement void. (Pub. Contract Code § 10420)
Members of boards and commissions are exempt from this section if they do not receive
payment other than payment of each meeting of the board or commission, payment for
preparatory time and payment for per diem. (Pub. Contract Code § 10430 (e))
2. LABOR CODE/WORKERS' COMPENSATION: Contractor needs to be aware of the
provisions which require every employer to be insured against liability for Worker's
Compensation or to undertake self-insurance in accordance with the provisions, and
Contractor affirms to comply with such provisions before commencing the performance
of the work of this Agreement. (Labor Code Section 3700)
3. AMERICANS WITH DISABILITIES ACT: Contractor assures the State that it
complies with the Americans with Disabilities Act (ADA) of 1990, which prohibits
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
discrimination on the basis of disability, as well as all applicable regulations and
guidelines issued pursuant to the ADA. (42 U.S.C. 12101 et seq.)
4. CONTRACTOR NAME CHANGE: An amendment is required to change the
Contractor's name as listed on this Agreement. Upon receipt of legal documentation of
the name change the State will process the amendment. Payment of invoices presented
with a new name cannot be paid prior to approval of said amendment.
6. RESOLUTION: A county, city, district, or other local public body must provide the
State with a copy of a resolution, order, motion, or ordinance of the local governing body
which by law has authority to enter into an agreement, authorizing execution of the
agreement.
7. AIR OR WATER POLLUTION VIOLATION: Under the State laws, the Contractor
shall not be: (1) in violation of any order or resolution not subject to review promulgated
by the State Air Resources Board or an air pollution control district; (2) subject to cease
and desist order not subject to review issued pursuant to Section 13301 of the Water
Code for violation of waste discharge requirements or discharge prohibitions; or (3)
finally determined to be in violation of provisions of federal law relating to air or water
pollution.
Ml
LODI ENERGY CENTER - PHASE 2 AGREEMENT
11/29/07 Commission Approved
RESOLUTION NO. 2007-247
A RESOLUTION OF THE LODI CITY COUNCIL
AUTHORIZING THE CITY MANAGER TO EXECUTE AN
UPDATED SECOND PHASE MEMBER AGREEMENT WITH
THE NORTHERN CALIFORNIA POWER AGENCY FOR
THE LODI ENERGY CENTER
NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby
authorize (i) the City Manager to execute an updated Second Phase Member
Agreement with the Northern California Power Agency for the Lodi Energy Center and
(ii) the Electric Utility Director, or his/her designee, to representthe City in administering
the Agreement in accordance with its terms.
Dated: December 19,2007
I hereby certify that Resolution No. 2007-247 was passed and adopted by the
City Council of the City of Lodi in a regular meeting held December 19, 2007, by the
following vote:
AYES: COUNCIL MEMBERS - Hansen, Johnson, Katzakian, and
Mayor Mounce
NOES: COUNCIL MEMBERS -None
ABSENT: COUNCIL MEMBERS - Hitchcock
ABSTAIN: COUNCIL MEMBERS- None
ANDI JOHL
City Clerk
2007-247
'%M r _ t
f #
Ah
Background
• Northern California Power Agency is developing a new
baseload generating facility
• Proposed location is adjacent to existing "STIG" unit at
Lodi's water treatment plant
• Initial development phase completed (Phase 1) -- "Fatal
Flaw" analysis
• Additional more detailed studies are being proposed as
Phases 2A and 26
• Lodi previously approved Phase 2 on March 7, 2007 but
not implemented due to lack of participation by others
2
n �Q
'9<�FLodi Energy Center
-
• 255 mw, 1 x1 x1 Combined Cycle Frame Unit
• CEC Permitting Required
• Located adjacent to STIG CT2
• COD Summer 2012
• 7000 Heat Rate Baseload Plant, Natural Gas
• Transmission - Western/N P 15
• Total Project Costs $231++ million
• NCPA Commission has approved Phase 2
development ($25 million)
K
n �Q
'9<�FCombined Cycle Basics
0 "
Cooling Tower
Condenser so E�I�aust
Elechricit-� M t
Barri Turbine"' Barri
'7- Fu e
Cornbu bor
17
M1
Gas Turbine
Compressor
Intake fir
Turbine
Water Furnp
Heat Recover
Barri Generator
- Elechric&t
Generator
4
OF
IF0
P rn -1 F
Upt;dtlu
Zeh
.k
q
n �Q
Phase 2
Z 0��
Phase 2A(through December 2008)
■ Initial engineering studies
■ CEC permitting evaluation
■ Equipment specification
■ Updated cost projections and timelines
■ Acquisition of air pollution credits
Phase 2g (through December 2009)
■ Detailed engineering
■ Acquisition of permits
■ Development of Phase 3 agreements
■ Preparation of construction RFPs.
C.1
Key Changes
n �Q
(since March 1 1
• Participants
• CDWR at 60 MW; Azusa at 7 MW
■ Roseville at 0 MW
• Phase 2 Cost Estimate
■ Increase from $14 to $25 million
• Construction Cost Estimate
■ Increase from $231 M to ?
• Projected In -Service Date
• 2011 to 2012
7
Participation
G��-4� 4
Participants
Participant
Capacity (mW)
Share of
Subscribed mW (%)
Share of Project
mW (%)
Azusa
7
2.8%
2.7%
BART
15
6.0%
5.9%
Biggs
1
0.4%
0.4%
CDWR
60
24.1%
23.5%
Gridley
5
2.0%
2.0%
Healdsburg
4
1.6%
1.6%
Hercules
0
0.0%
0.0%
Lodi
30
12.0%
11.8%
Lompoc
5
2.0%
2.0%
Merced
0
0.0%
0.0%
Modesto
60
24.1%
23.5%
Plumas-Sierra
2
0.8%
0.8%
PWRPA
5
2.0%
2.0%
Redding
0
0.0%
0.0%
Roseville
0
0.0%
0.0%
Silicon Valley Power
50
20.1%
19.6%
SMUD
0
0.0%
0.0%
TO
0
0.0%
0.0%
Ukiah
5
2.0%
2.0%
Total
2491
100.0%1
97.6%
n �QLodi Participation Level
• Lodi participated in Phase 2A at 25 MW
level
• Review of Lodi baseload needs indicates a
good fit for 30 MW.
■ Same level as approved by City Council on
March 7, 2007
10
iu.0
60.0
50.0
t
c 40.0
30.0
C9
20.0
10.0
0.0
Energy Balance
v
v
v
v
v
v
7
0
4
0
OD
0
(0
O
N
� Geo
Hydro1
� Energy Purch
� WAPA
= PPA/Gen = Stig
0 CTs Load
11
20.0
10.0
0.0
-10.0
-20.0
-30.0
-40.0
-50.0
-60.0
-70.0
Net Energy Balance
C- � C- C- C- C-
m v v v v v
:F :F 7 7 7
0 0 0
v w co o N
Month
■ HLH
- LLH
12
Lodi Power Resources
Resource
MWH
Geothermal
100,000
Hydroelectric
567000
CT1 Project
0
Lodi STIG Project
0
Western Hydro
16,000
[Seattle Contract
--------------------
Totals
(10,000)
----------------
162,000
Lodi Needs
495,000
Net
(333,000)
New Lodi
225,000
13
Phase 2 Costs
14
Phase 2
Cost Estimates
15
Phase 2 Costs
(millions)
Note: Based on a 249 MW subscription level.
16
Phase 2A
Phase 213
Total
Project
$16
$9
$25
Lodi
$1.94
$1.09
$3.03
Note: Based on a 249 MW subscription level.
16
Cash Flow
LODI ENERGY CENTER
Schedule of Cash Flow
$25,000,000
i $20,000,000
$15,000,000
$10,000,000
LU $5,000,000
$0
Timeline
1—cumulative — Monthly
17
G��-4� 4
Emission
Reduction Credits
Pollutant
Tons/Year
$/Ton
NOx
90
409000
Sox
5
459000
PM10
55
809000
VOC
25
459000
Note: Phase 2 Budget is $12.5 million
18
Construction
Costs
19
F <0
00
0
Capital Costs
Average Nominal Instaltafim Casft Based m Orme Year (S/kW)
low
GPM
zan----------------------------------
7+aa ----------------------------------
_van ------- --- ------
1 --------------------------------------------------
0
i%ala 20al 2CWU 2003 3004 20W
Ombse'vemy
--= and -got=:
i Dzu m ® rmFmzmcy. m3b1 bmll-m o n a , lmfl� Dw.Imx4uff, anim. &ft, zo d m* ;y" :ffie tbopsmtfd 20W -2Ud
w� i fix� r.zmmm=miully aam&Lb" &dmIm ms axa nal6w � .mh .. Dmmf�f wik.m.i amd 1& rmrm#r-
2007 CPUC
CT 2012
Capital $/KW
$1,099
N11
Project Cost Summary
• $65 / MWh @ 78% Capacity Factor:
• $8.58/Mwh debt cost for $231 MM
. +$5.67/Mwh O&M
. +$49.35/Mwh Gas (@ $7/mmbtu)
. + $1.40/Mwh NCPA Costs
Note: Each 10% change in capital cost results in
about a $ .70 / MWh change in plant bus bar cost
21
OF
0
Joint Site Savings
• Savings by Sharing STIG resources
■ Savings of - $2.2/mwh in labor cost
■ Only 7 more employees necessary vs. 17 for a stand
alone
• Savings from Joint Infrastructure
■ Office Space /Control Room/Warehouse/Shop
■ Water Treatment equipment/ SCR Ammonia
22
In-Service Date
23
Project Schedule
Task Name Finish
New Lodi Project
Fri 40A2
Approval of Phase III
Thu 11 J18A38
Develop Project Subscr
Thu K0l07
Establish Project Team
Thu 7A M7
Establish Preliminary Si
Wed 7A 8!07
Establish Project Pararr
Thu 7A 9!07
Ener. AsmrFL RFP Prep$I
Fri 70W
Ener. Assmrit. Vendor Si
Thu 80W
Ener. Assmri .
Fri 9A M8
Engineering
Thu 721 !08
Data Adequacy (CEC)
Tue 1 !8!10
AFC Application
Fri 1 !1 !10
AFC Granted
Fri 1200
Phase III Approved
Thu 2A M9
Project Financing
Thu 3WI 0
Commence Constructii
Fri 40A 2
Testing and Startup
Fri 40A 2
Commercial Operation X, Fri 40A 2
2nd Half I 1st Half 12nd Half I 1st Half 12nd Half 11 st Half 12nd Half
W3
EM
X20
PM9
314;
7
24
n �QProject Benefits
Local/Public Ownership and Control
• Tax Free Financing
Blended Economics of Using Existing
STIG Facilities.
High Efficiency - 7050 Btu/kWh .
Gas Contracts Provide Fuel Hedging
Future Capacity Value.
Meet supply need to serve retail load.
W
Other Considerations
• Project can connect to CAISO and/or
Western/SMUD control areas
• May provide "behind the meter" benefits
for Lodi (reduction of transmission costs
and energy losses)
• Opportunity for new transmission
interconnection to west for Lodi (improved
reliability)
W
Summary
• Phase 2 is essentially fully subscribed
• Phase 2 cost estimate is about $25 million
• Lodi's share of Phase 2 costs is about
$3.03 million for 30 megawatts
• Phase 2 to extend until December 2009
• Projected in-service date is April 2012
• Staff recommends execution of updated
Phase 2 Agreement
27
Questions/comments?