Consent Item 10
Consent Item 10
TO: East Bay Community Energy Board of Directors
FROM: Marie Fontenot, Vice President of Power Resources SUBJECT: Amcor Storage Contract Approval (Action)
DATE: May 17, 2023
__________________________________________________________________ Recommendation
Adopt a Resolution authorizing the Chief Executive Officer to execute an Agreement with Amcor Storage LLC for a battery energy storage project in Solano County, developed by Nexus Renewables. The project operation dates are listed below:
a. Amcor Storage: 10-year, 9.499 MW battery project located in Fairfield, CA.
March 2024 online date. Developed by Nexus Renewables.
Background and Discussion
The 2022 Long-Term Resource Request for Offers (RFO) is EBCE’s third long-term contract solicitation. The RFO was launched in February 2022. The RFO sought several hundred megawatts (MW) of contracts with renewable energy and battery storage projects with a preference for projects located in California, and more preferentially, those located in Alameda County. EBCE’s objective was to drive investments in new renewable and energy storage projects in Alameda County and California, while securing affordable resources to manage future power price risk. EBCE received a very healthy response to its RFO both in volume and quality of projects and proposals.
EBCE administered the RFO and completed robust analytics using internal tools and the cQuant valuation platform to calculate the net present value of proposed projects and determine the optimal portfolio to meet its objectives. All of these contracts will be utilized to hedge EBCE against price fluctuation in the CAISO energy markets and they will also contribute to procurement mandates issued by the California Public Utilities Commission (CPUC). The 2021-2023 Electric Reliability Requirements procurement mandate identified volumes of Resource Adequacy (RA) capacity each Consent Item 10
CPUC-jurisdictional load serving entity must procure and have online in the years 2021, 2022 and 2023.1 The second mandate requires additional volumes of RA come online in years 2023, 2024, 2025, and 2026. That mandate is the “Decision Requirement Procurement to Address Mid-Term Reliability 2023-2026”.2 The Amcor Storage project was offered to EBCE bilaterally, concurrent to ongoing negotiations underway in EBCE’s 2022 Long-Term Resource RFO and was evaluated against offers submitted to the RFO.
The Amcor Storage contract is for RA from a 9.499 MW/37.996 MWh battery storage project. The contracted project is located in Solano County. The contract is for 10 years with a guaranteed commercial operation date of March 1, 2024. Nexus is a developer having 410 MW of solar and energy storage projects in development. The contracting entity is Amcor Storage LLC.
Attachments
A. Resolution Authorizing the CEO to Negotiate and Execute a Ten-Year Resource Adequacy Agreement with Amcor Storage LLC for a battery energy storage project in Solano County, developed by Nexus Renewables, U.S. Inc; and B. PowerPoint Presentation.
1 https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M319/K825/319825388.PDF 2 https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M389/K603/389603637.PDF Attachment Consent Item 10A
RESOLUTION NO. R-2023-XX
A RESOLUTION OF THE BOARD OF DIRECTORS
OF THE EAST BAY COMMUNITY ENERGY AUTHORITY AUTHORIZING THE CEO TO
NEGOTIATE AND EXECUTE A RESOURCE ADEQUACY AGREEMENT WITH AMCOR
STORAGE LLC
WHEREAS, The East Bay Community Energy Authority (“EBCE”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, Under the Joint Exercise of Power Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of EBCE and parties to the JPA in March of 2020.
WHEREAS, Amcor Storage, LLC proposed 9.499 MW of Resource Adequacy (RA) from a 9.499 MW/37.996 MWh battery energy storage project in Solano County, developed by Nexus Renewables, U.S. Inc (“Project”);
WHEREAS, the Project is expected to be operational by March 1, 2024 and will deliver RA for a term of ten years; and
WHEREAS, EBCE staff considers this is a competitive proposal based on submissions to the 2022 Long-Term Resources Request For Offers (RFO).
NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE EAST BAY COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:
Section 1. The CEO is hereby authorized to negotiate and execute a ten-year RA agreement with Amcor Storage LLC for a 9.499 MW RA-only battery energy storage project in Solano County. The final agreement shall include the key terms outlined in the staff report recommendation associated with this Resolution.
ADOPTED AND APPROVED this 17th day of May, 2023.
Elisa Márquez, Chair
ATTEST:
Adrian Bankhead, Clerk of the Board
2022 Long-Term Resource RFO:
Project Update
PRESENTED BY: Marie Fontenot
DATE: May 17, 2023
Attachment Consent Item 10B
• Solicitation Overview
• Participation
• Evaluation Process
• Current RFO Portfolio Characteristics
• Challenges in Marketplace
• Next Steps
• Appendix: Portfolio Summary
2 Agenda
Attachment Consent Item 10B
Goals & Objectives • Secure a portfolio of contracts
to provide EBCE customers
with affordable renewable
and clean energy sources • Meet IRP Near- and Mid-Term
Resource Adequacy Reliability
Procurement mandates • Meet a significant percent of
SB350 long-term contracting
requirements, equal to 65% of
RPS obligations • Create new renewable energy
projects to deliver PCC1 RECs • Contract low-cost energy hedges to compliment existing portfolio • Partner with SJCE for efficiency, to minimize
expenses, and lead the
market in contract terms
Actions • Issued a broad, open,
competitive solicitation to
ensure wide array of
opportunities considered • Evaluated combinations of
projects to achieve desired
volume targets • Typically prioritize project risk,
location, workforce
development, economics, and
other characteristics; limited
ability to do so in this RFO due
to limited offers in earlier years • Encouraged RFO participants to be creative and provide
proposal variations on
individual projects and include
battery storage
3 Project Characteristics
Facilities: • Location: Projects may be within or outside of California. All energy must be deliverable
to CAISO & must provide RA • Construction Status: Energy and related products may come from new resources or add incremental capacity to existing
resources.
Capacity: • Minimum Contract Capacity: 5 MW
• Maximum Contract Capacity: none
Delivery Date: • Energy and RPS attribute delivery must be within calendar years 2023, 2024, 2025, or
2026 with a preference for projects that
begin delivery earlier within this window.
Contract Duration: • 10-20 year durations
Technology: • Renewables, Large Hydro • Storage – short or long duration; any technology
Solicitation Overview
Attachment Consent Item 10B
4 Solicitation Overview – Eligible Products
Product # Product Name Description Example
solar, wind, geothermal, small
hydro or ocean (thermal,
wave, or current)
New or incremental capacity to an existing stand-alone PCC1-eligible generating resource Product 1 As-Available RPS Product
Same as above plus storage
with 2-hr, 4-hr, or 4-hr+
duration capability
New or incremental capacity to an existing stand-alone PCC1-eligible generating resource with co-located energy storageAs-Available RPS plus Energy Storage
Product 2
Energy delivered during
specific hours
New PCC1-eligible generating resources; likely
paired with energy storage
Firm or Shaped RPS
Product
Product 3
New stand-alone PCC1-eligible generating Geothermal or Biomass resource
High Capacity Factor, No
On-Site Emissions RPS
Energy
Product 4
Any storage technology with
2-hr, 4-hr, or 4-hr+ duration
capability
Energy storage may offer a full product “tolling”
structure contract or and RA-only offer
Stand-Alone Energy
Storage Toll or RA-Only
offer
Product 5
Emission-free generation
resources, emissions-free
generation paired with
storage, or demand response
Must be available every day from 5pm to 10pm
(hours ending 17 through 22); must be able to
deliver at least 5 MWh of energy for every 1 MW
of incremental capacity
Zero-Emitting Capacity
Resources
Product 6
Attachment Consent Item 10B
5 Participation • Less robust project offering than 2020 RFO. 44 unique project sites; 185 contract variations (as compared to 70 sites; 400 project variations in 2020 RFO) • All 6 products that were solicited were offered • Offers included solar, wind, geothermal, pumped hydro, and storage • Projects based in 6 different states (CA, AZ, ID, NM, NV, OR); predominantly CA – *Only 1 projects in EBCE service territory.
Attachment Consent Item 10B
Evaluation Process • Evaluation Rubric scored 3 areas: – Counterparty Execution, Offer Competitiveness, and Project Development Status – Multiple items under each area • Two reviewers were assigned to each project. • Staff reviewed all submitted information and provided scores for all categories except for Term Sheet Markups and NPV. – Each item has 10 point max. at its own weighting. – Term Sheet Markups were scored by one assigned reviewer. – NPV scores were directly incorporated into overall project score with a weighting of 45%. • The Net Present Value was calculated based on simulations on 3 different forward curves • For each forward curve we took a weighted average of the P5 (50%), P50 (25%), and P95 (25%) and then took a simple average across the 3 curves • We normalized this number on a $/MW basis and the projects were then assigned a 0-10 score based on the NPV distribution • Scoring and rubric were consistent with the selection process for the 2018 California Renewables RFP and 2020 RPS and Storage RFO.
6 Attachment Consent Item 10B
Projects Proposed for Execution
7 Seeking approval for one contract:
• Amcor Storage: 10-year, 9.499 MW RA-only from battery storage project in Solano County. Expected to be operational March 2024. Developed by Nexus Renewables.
Attachment Consent Item 10B
Nexus Renewables - Amcor
Storage Project Details
8 • Originated and negotiated bilaterally
• Contract for 9.499 MW Resource Adequacy from energy storage project in Solano County
• 10-year contract
• Expected Commercial Operation Date is March 1, 2024
• Project has executed site control and interconnection agreement. • Committed toward utilizing local and union labor and paying prevailing wages.
• The contracting entity under is Amcor Storage LLC.
Attachment Consent Item 10B
Nexus Renewables Company
Overview
9 • Nexus Renewables is a renewable developer focused on solar and energy storage technologies.
• Nexus was established in 2020 and has 410 MW of projects in various stages of development, including 14 MW of solar under construction in the U.S. • The Nexus management team draws upon 60+ years of experience in the Power and Utility sector.
Attachment Consent Item 10B
Portfolio Characteristics
10 Sept
NQC Developer Project Location Product Offtake COD Nameplate Longroad Sun Pond Maricopa County, AZ PV and ESA EBCE 4/1/2025 85 MW 34.4 Gener -ation ESA EBCE 6/1/2025 125 MW 116.75 San Joaquin County
(Tracy), CA NextEra Energy Kola Energy Storage Stor -age Nexus Amcor Storage Solano County, CA RA only EBCE 3/1/2024 9.499 MW 9.499 RA Only ConEd Alpaugh BESS Tulare County, CA RA only EBCE 6/1/2024 5 MW 4.5 Vitol Ocotillo Solar San Diego County, CA RA only EBCE 8/1/2023 50 MW 50 Noosa Energy Storage San Joaquin County, CA RA only EBCE & SJCE 6/1/2024 30 MW 27 Broad Reach Power
San Joaquin County, CA RA only EBCE & SJCE 6/1/2024 5 MW 4.5 Cascade Energy Storage
Broad Reach
Power
Attachment Consent Item 10B
Next Steps
• Finalize the contract and execute agreement.
• Assess projects as they hit key milestones and mature further. • Update filing to CPUC on status of 2021-2023 and 2023-2026 Electric Reliability Requirements due June 1, 2023.
11 Attachment Consent Item 10B
Appendix
12 Attachment Consent Item 10B
Portfolio Summary
13 Attachment Consent Item 10B