REPORT TO COUNCIL
SUBJECT
Title
Action on the Electric Service Agreement with Equinix Corporation
Report
BACKGROUND
During the fall of 2017, the Equinix Corporation ("Equinix"), an international business exchange and co-location data center facility with multiple locations in the City of Santa Clara, advised Silicon Valley Power ("SVP") that it was considering expanding its underutilized facility at 1350 Duane Avenue providing it was permitted to install a greater than 5 MW fuel cell self-generation plant.
In further discussions, SVP advised Equinix that this installation would require SVP to supply back-up electrical service in the event that this proposed fuel cell was not available (e.g. instances of interruptions to fuel supply, switchgear/equipment failures, or during annual maintenance periods). It was determined that SVP's then existing standby rate schedule was not directly applicable to the fuel cell circumstances. Through cooperative discussions with Equinix and the fuel cell provider, SVP was able to more clearly understand the circumstances by which it may be required to provide back-up services. SVP and Equinix determined how back-up services would be incorporated in Equinix's fuel cell procurement modeling.
Outside of those negotiations, on December 19, 2017, City Council adopted Resolution 17-8485 which updated Rate Schedule SB-1, effective on January 1, 2018, to broaden the applicability of Rate Schedule SB-1 to accommodate the greater variance of self-generation configurations.
DISCUSSION
Equinix continued procurement of the fuel cells as part of their national corporate strategy. Equinix indicated in discussion that except for the fuel cell installation, they would not be expanding their business at 1350 Duane Avenue. Since Equinix had approached SVP prior to the final modification and approval of Rate Schedule SB-1, they had not been able to properly assess the impact of the updated Rate Schedule SB-1 on their expansion and fuel cel...
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