HomeMy WebLinkAboutResolutions - No. 2015-204RESOLUTION NO. 2015-204
A RESOLUTION OF THE LODI CITY COUNCIL APPROVING A COLLATERAL
ASSIGNMENT OF THE POWER PURCHASE AGREEMENT TO PERMIT
FINANCING OF THE ASTORIA 2 SOLAR PROJECT BY EFS RENEWABLES
HOLDINGS, LLC AND APPROVING RELATED AMENDMENTS TO THE
EXISTING POWER PURCHASE AGREEMENT TO EFFECTUATE SUCH
FINANCING AS CONTAINED IN A CONSENT AND AGREEMENT; A
NON -DISTURBANCE AND ATTORNMENT AGREEMENT; AND AN
INTERCREDITOR AND SUBORDINATION AGREEMENT; AND DIRECTING
THE CITY MANAGER TO EXECUTE SAID AGREEMENTS
WHEREAS, on June 18, 2014, the Lodi City Council approved a Power Purchase
Agreement (PPA) with RE Astoria 2 LLC, a wholly-owned subsidiary of Recurrent Energy, to
purchase 10 MW of energy and capacity, and associated environmental attributes, to be
generated by RE Astoria 2 LLC from the Astoria 2 Solar Project for a period of 20 years at a
fixed price of $64 per MWh; and
WHEREAS, in addition to RE Astoria 2 LLC as Seller and the City of Lodi, the other
parties to the PPA are the Southern California Public Power Authority (SCPPA), Power and
Water Resources Pooling Authority (PWRPA), and the cities of Corona, Moreno Valley and
Rancho Cucamonga (Cities). SCPPA, PWRPA, Cities, and the City of Lodi are jointly the buyers
(Buyers) under the PPA; and
WHEREAS, the Astoria 2 Solar Project is a 75 MW photovoltaic plant currently under
construction which will assist the Lodi Electric Utility (LEU) with meeting its Renewables
Portfolio Standard obligations; and
WHEREAS, RE Astoria 2 LLC has requested the consent of the Buyers to a collateral
assignment of the PPA for the Astoria 2 Solar Project to reflect the ownership interest of a
proposed new tax equity investor, EFS Renewables Holdings, LLC, a wholly-owned subsidiary
of General Electric Corporation, which requires the consent of the Buyers; and
WHEREAS, the PPA provides the Buyers' consent shall not be unreasonably withheld;
and
WHEREAS, EFS Renewables Holdings, LLC, has requested certain limited
amendments to the PPA be approved by RE Astoria 2 LLC and the Buyers, as indicated in the
Consent and Agreement in order to secure financing from its construction lender Deutsche Bank
Trust Company Americas (DBTC); and
WHEREAS, DBTC has further requested that RE Astoria 2 LLC and the Buyers approve
a Non -Disturbance and Attornment Agreement and an Intercreditor and Subordination
Agreement to protect DBTC's rights in the event of default by RE Astoria 2 LLC or EFS
Renewables Holdings, LLC, as a condition of its loan; and
WHEREAS, the Non -Disturbance and Attornment Agreement also includes as a party,
RE Astoria 2 Landco LLC, an additional wholly-owned subsidiary of Recurrent Energy and the
owner of the property on which the Astoria 2 Solar Project is being constructed; and
WHEREAS, in consideration of the requested contractual amendments and approvals,
RE Astoria 2 LLC has agreed to provide to the Buyers, including the City of Lodi, a $1 per MWh
reduction in price as reflected in the proposed Consent and Agreement; and
WHEREAS, each of the Consent and Agreement, Non -Disturbance and Attornment
Agreement, and Intercreditor and Subordination Agreement were presented to the Risk
Oversight Committee at their November 9, 2015 meeting and unanimously recommended
City Council approval.
NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby approve
a collateral assignment of the Power Purchase Agreement to permit financing of the Astoria 2
Solar Project by EFS Renewables Holdings, LLC; and
BE IT FURTHER RESOLVED that the Lodi City Council does hereby approve related
amendments to the existing Power Purchase Agreement to effectuate such financing as
-contained in—the foNowing--agr-eement�appraves—the fallowing --agreements, and directs—the-
City Manager to execute them on behalf of the City of Lodi, with any non -substantial changes
recommended and approved by the City Attorney:
Consent and Agreement among Southern California Public Power Authority
(SCPPA), Power and Water Resources Pooling Authority (PWRPA), City of Lodi,
City of Corona, City of Moreno Valley, and City of Rancho Cucamonga (jointly
identified in the said agreement as Contracting Parties); and RE Astoria 2 LLC
(identified in the said agreement as Project Company), Deutsche Bank Trust
Company Americas (DBTC) (identified in the said agreement as Collateral Agent)
and EFS Renewables Holdings, LLC (identified in the said agreement as Class A
Member); and
2. Non -Disturbance and Attornment Agreement among RE Astoria 2 LandCo LLC
(identified in said agreement as Owner), RE Astoria 2 LLC (identified in said
agreement as Lessee), DBTC (identified in said agreement as Collateral Agent);
and SCPPA, PWRPA, City of Lodi, City of Corona, City of Moreno Valley, and
City of Rancho Cucamonga (jointly identified in the said agreement as Fee
Secured Party); and
3. Intercreditor and Subordination Agreement among SCPPA, PWRPA, City of Lodi,
City of Corona, City of Moreno Valley, and City of Rancho Cucamonga (jointly
identified in said agreement as Offtaker) and DBTC (identified in said agreement
as Senior Agent).
BE IT FURTHER RESOLVED that the Lodi City Council authorizes the City Manager to
execute and deliver any and all other documents and instruments and to do and cause to be
done any and all acts and things necessary or advisable for carrying out the transactions
contemplated by this Resolution for the Astoria 2 Solar Project, for the benefit of the City and
the other parties to the aforementioned agreements with administrative duties performed by the
Electric Utility Director.
Dated: November 18, 2015
I hereby certify that Resolution No. 2015-204 was passed and adopted by the City
Council of the City of Lodi in a regular meeting held November 18, 2015, by the following vote:
AYES: COUNCIL MEMBERS — Chandler, Kuehne, Mounce, Nakanishi, and
Mayor Johnson
NOES: COUNCIL MEMBERS — None
ABSENT: COUNCIL MEMBERS — None
ABSTAIN: COUNCIL MEMBERS — None
NIFER FERRAIOLO
City Clerk
2015-204