1 STAFF REPORT
DAT
E: July 30, 2024
TO
: Justin Hess, City Manager
F
ROM: Mandip Kaur Samra, General Manager, Burbank Water and Power VIA: Riad Sleiman, Assistant General Manager, Electric Services Erik Olsen, Acting Assistant General Manager, Power Supply BY: Michael Wang, Principal Electrical Engineer
S
UBJECT: Adoption of a Resolution to Approve Design and Construction Services to Support the Regional Intermodal Transportation Center Battery Energy Storage System Project, Authorize the BWP General Manager to Negotiate and Execute the Design- Build Contract with Baker Electric and Renewables, LLC , and Authorize the Acting Assistant General Manager (Power Supply) or their designee to Approve Plans and Specifications to Retain Design Immunity
RE
COMMENDATION
Adopt A RESOLUTION OF THE COUNCIL OF THE CITY OF BURBANK APPROVING
DESIGN AND CONSTRUCTION SERVICES TO SUPPORT THE REGIONAL
INTERMODAL TRANSPORTATION CENTER (RITC) BATTERY ENERGY STORAGE
SYSTEM (BESS) PROJECT, AUTHORIZING THE BWP GENERAL MANAGER TO
NEGOTIATE AND EXECUTE THE DESIGN -BUILD CONTRACT AS WELL AS ANY
ANCILLARY DOCUMENTS AND AMENDMENTS AS MAY BE NECESSARY WITH
BAKER ELECTRIC & RENEWABLES LLC, AND AUTHORIZING THE ACTING
ASSISTANT GENERAL MANAGER (POWER SUPPLY) OR THEIR DESIGNEE TO APPROVE PLANS AND SPECIFICATIONS (Attachment 1).
BACKG
ROUND
As part of the solar and Battery Energy Storage System (BESS) Projects, Burbank Water and Power (BWP) is in the process of designing and constructing a photovoltaic generation plant with energy storage at the Hollywood Burbank Airport Regional Intermodal Transportation Center (RITC). On January 23, 2024, Council una nimously approved the Request for Proposal (RFP) to provide design- build (DB) services for the solar project to Baker Electric and Renewables, LLC.
T
he proposed system will have 2.8-megawatt (MW) solar panels installed on the roof of the RITC, and there is a plan to integrate a BESS. In the past few years, most of all new solar projects have been paired with energy storage, especially as prices have decreased
WATER AND
POWER
2 and solar energy needs to be stored for use in more expensive hours of the day. The BESS addresses many of the issues of running a solar -only generation facility. One of the large issues is solar overgeneration during the daytime hours. Energy storage can absorb the oversupply of electricity production during that time and discharge it to the shoulder hours as the sun sets, where the need for generation is higher. Another challenge that solar systems face is weather-related volatility, namely when clouds block the solar facilities' ability to produce consistent energy. Energy storage fills in those momentary drops in generation and provide s a consistent and reliable power source to smooth out the generation.
As part of the RFP process, bidders were requested to provide an optional proposal for a BESS to be evaluated for use in the final agreement. While included with the RFP proposal, the BESS proposals were not scored in the RFP selection criteria. Nonetheless, it was seen that out of the two BESS option proposals, Baker delivered a more competitive and qualified proposal. After receiving Baker’s battery proposal, it was determined that to make the pricing and scope more accurate, further negotiation for the battery component after awarding the solar agreement would be necessary.
DISCUSSION
BWP understood that due to the uniqueness of every renewable generation facility and the relative newness of energy storage systems, separating the solar and battery components in the initial RFP process was prudent. While energy storage is prevalent in most new solar proposals, the construction experience for these assets is still relatively young and inconsistent. By separating the solar and energy storage system proposal s, BWP had the ability to fairly evaluate the less complicated solar proposal and not penalize bidders for providing an unsuitable battery proposal that did not match the City’s needs.
Due to no bids received for the BESS when an RFP was released in 2023 and the extremely varied and inconsistent BESS proposals received in the most recent Solar RFP BS 1521, BWP determined it would be in the interest of the C ity to negotiate a proposal with the current solar design- build contractor. Baker was selected to build the solar generation facility through an open-competitive RFP process due to their experience and design expertise, which they will bring to the table to include a BESS.
BWP has instructed Baker to include two Tesla Megapack 2XL energy storage systems in the detailed design of the solar system. This proposed addition will pair a 1.96 MW 4- hour duration energy storage system with the planned solar system and allow BWP planners and system operators to have control over a substantial amount of the solar electricity generated at this facility.
Staff recommends that Council find that it is in the best interest of the C ity to waive the competitive bidding process in favor of the design-build process with Baker and authorize the BWP General Manager to execute the DB contract to support the RITC BESS project as outlined in the attached resolution and substantially in the form of the previously released Bid Schedule No. 1521.
3 Design Immunity
California Government Code § 830.6 provides design immunity to the C ity for any injury caused by the plan or design of a construction of, or an improvement to, public property where such plan was approved by Council. Design immunity is a liability protection provided for public projects when plans have been reasonably approved and errors may have been found at a later time. In a traditional design- bid-build project, design or pl an approval occurs when Council awards the construction project just after bidding. With a DB project, final plans and specifications are not completed until after Council approval.
Therefore, to retain design immunity, Council or any employee exercising discretionary authority must approve the plans and specifications for a project using the DB method.
The Council may also delegate this authority. Accordingly, staff requests that Council expressly delegate authority for approving plans and specifications to the BWP Acting Assistant General Manager (Power Supply), or their designee.
COMMUNITY OUTREACH
Staff presented an overview of the RITC solar and BESS project to Council on April 12, 2022, as part of a note and file. On March 2, 2023, staff presented an update to the BWP Board on the initial bid effort and discussed the second bid effort took place. In 2023, four community outreach events for the Integrated Resource Plan (April 20, July 13, August 10, and October 26) mentioned the RITC solar project as an example of a project that would fulfill part of the utility’s long-term generation goals. The final Integrated Resource Plan presentation at the Council meeting on December 5, 2023, also mentioned the project. Lastly, in addition to including airport staff on the evaluation committee and oral interviews for the RITC solar project proposals, staff conducted outreach at an A irport Commission meeting on September 18, 2023, to provide a conceptual overview and update the commissioners and any members of the public that were present on the progress of BWP’s second bid process for the RITC solar and BESS project.
ENVIRONMENTAL REVIEW
The design and construction work authorized by the resolution meets the exemption criteria set forth in the CEQA Guidelines, Public Resources Code § 21080.35, which provides that installing a solar energy system on the roof of an existing building or on an existing parking lot is statutorily exempt from CEQA. As indicated in § 21080.35 (b)(2) this exemption defines a “solar energy system” to include all associated equipment.
Associated equipment consists of parts and materials that enable the generation and use of solar electricity or solar -heated water, including any monitoring and control, safety, conversion, and emergency responder equipment necessary to connect to the customer’s electrical service or plumbing and any equipment, as well as any equipment n ecessary to connect the energy generated to the electrical grid, whether the connection is onsite or on an adjacent parcel of the building and separated only by an improved right-of-way. As such, staff recommends that the Council find such activity and adoption of this resolution statutorily exempt from the California Environmental Quality Act (CEQA) (Public Resources Code, § 21080.35).
FISCAL IMPACT
The solar agreement with Baker, previously approved by Council, was executed at a cost of $10,791,048. Baker's originally proposed energy storage system cost $8,610,487.62.
After negotiations and clarifications of scope and battery selection, the current cost for 4 the energy storage system proposal was decreased to $4,360,383. Staff recommends an additional contingency amount of $218,019 (5%) to address any unforeseen issues or circumstances. BWP has sufficient budget authority for this additional cost for Fiscal Year 2024-25.
CONCLUSION
Staff recommends that Council delegate authority to the General Manager of BWP to negotiate and execute a DB contract for the RITC solar project with Baker substantially in the form of Bid Schedule No. 1521, as well as enter into any ancillary documents an d amendments as may be approved by the City Attorney’s Office but only to the extent the applicable funds are available and budgeted, and authorize the Acting Assistant General Manager (Power Supply), or their designee, to approve plans and specifications for the project, as outlined in the draft resolution.
ATTACHMENTS
Attachment 1 – Resolution
Attachment 2 – Design-Build Agreement for BESS Project at Hollywood Burbank Airport RITC