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a~ <br />` ~ ~ i~.~~ <br />1414 Raleigh Road, Suite 305 <br />Chapel Hill, North Carolina <br />(919)419-9802 (Fax 419-9803) <br />~neet~ng rotes <br />UNC -Alternative Energy Analysis Landfill Gas Investigation 08029-00 <br />Project Project No. <br />University of North Carolina- Chapel Hill 02/26/2008 <br />Owner <br />Preliminary Economic Review <br />Type of Meeting <br />Meeting Date <br />Page 2 of 2 ias <br />Page Typist <br />5. The total revue is approximately $12,000,000 over a 30 year project life, but is highly dependent on <br />the value of carbon credits. <br />a. The carbon credits generated by the project are as follows: <br />1. Methane destruction (about 80% of the total) <br />2. Direct biogenic C02 emission reductions <br />b. The carbon credits were valued at $3.50/tonne until a cap and trade market was assumed to <br />begin in 2012. At that time, the price was assumed to be $15.00/tonne and was then <br />increased by the rate of inflation for subsequent years. <br />6. Avery preliminary proforma was presented and suggested as a starting point for negotiation. This <br />proforma used the guiding principals noted above to equally share the revenue over the course of <br />the project. The hierarchy of revenue distribution was as follows, based on the assumption that <br />UNC provided the funding for the capital costs: <br />a. Pay O&M costs <br />b. Provide a "preferential" distribution to the County of approximately 10% of the annual <br />revenue until all capital is recovered <br />c. Recover capital investment <br />d. Once all capital is recovered, distribute revenue to achieve a similar NPV for both the <br />County and UNC <br />7. The preliminary proforma resulted in a NPV of about $2,500,000 to each entity over the life of the <br />project. A copy of the information distributed at the meeting is attached to these notes. <br />8. The next meeting is scheduled for March 11th at 3:00 pm to continue dialog on the economic <br />evaluation and final Agreement. The following action items are to be completed in the interim: <br />a. Review proforma and guiding principles and generate comments/concerns <br />b. Review similar landfill gas agreements and start an agreement for this project <br />These minutes represent our best understanding of the discussions held and decisions reached at the <br />meeting. Please advise the writer of any errors or omissions of substance. <br />Affiliated Engineers <br />Jerry A. Schuett, P.E. <br />Principal/Project Manger <br />