REPORT TO COUNCIL
SUBJECT
Title
Actions on agreements associated with Battery Energy Storage System (BESS) Project at Santa Clara University (SCU), Authorizing City Manager to
1. Execute a Memorandum of Understanding (MOU) with SCU;
2. Negotiate and execute a Property Lease Agreement with SCU;
3. Execute BESS Sale and Purchase Agreement with Tesla, Inc. (Tesla)
4. Execute BESS Services Agreement with Tesla
Report
COUNCIL PILLARS
Promote Sustainability and Environmental Protection
Deliver and Enhance High Quality Efficient Services and Infrastructure
BACKGROUND
On June 18, 2018, the Bay Area Air Quality Management District (BAAQMD) awarded a Climate Protection Grant in the amount of $300,000 to SVP for a Battery Energy Storage System (BESS) project. The purpose of the BESS project is to demonstrate the use-case for lithium-ion batteries as longer-duration uninterruptible power supply for data centers that are instantaneous and reliable, delaying or avoiding the use of diesel generators as emergency backup power.
BAAQMD selected SVP's pilot project based on the strength of the evaluation criteria that makes progress towards achieving greenhouse gas (GHG) reductions for the City of Santa Clara, the project's focus in disadvantaged communities, and meeting the air quality goals for the State and local jurisdictions. BAAQMD encouraged public agency applicants to collaborate with external partners. As such, SVP collaborated with Tesla on the BAAQMD grant. This collaboration increased the strength and feasibility of the strategic approach of the project making the proposed project more competitive for a grant award. The grant will be used to fund the procurement of the Tesla BESS. As part of the partnership for the BAAQMD grant, Tesla will be providing a 20-year operating and maintenance (O&M) agreement "in-kind" which will cover the entire operating life of the BESS.
DISCUSSION
The pilot project will demonstrate the economic viability and flexibility ...
Click here for full text