Agenda - 12-01-2008 - 3c - Laserfiche WebLink

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2 easements across County-owned properties to construct the pipeline used to transport the LFG to UNC. . Operating Responsibilities: UNC is solely responsible for constructing, operating, maintaining, and repairing the LFG Project, including all associated costs and legal compliance obligations. The County is solely responsible for operating and maintaining the Landfill, exclusive of the LFG Project, including all associated costs and legal compliance obligations. The Agreement also provides the Landfill's operations take precedence over the LFG Project's operations. Commercial Terms: UNC will make monthly payments to the County calculated on the heating energy content of LFG delivered to UNC multiplied by an index price for natural gas that is capped at $9.00 per MMBtu (inflation adjusted on a compound basis at 2% per year). The commercial terms rest on an economic analysis resulting in an equal sharing of project value between the County and UNC during the Term of the Agreement. For LFG combusted through flaring, UNC pays the County 5.3% of the LFG's heating energy content multiplied by the natural gas price. For LFG combusted through energy conversion, UNC pays the County 16.6% of the LFG's heating energy content multiplied by the natural gas price. These percentages are subject to upward or downward adjustments should the U.S. enact federal legislation restricting greenhouse gas emissions affecting certain underlying economic assumptions agreed to by the parties. However, the 5.3% flare percentage cannot go lower than 2.09%or higher than 8.51 %. The 16.6% energy conversion percentage cannot go lower than 6.52% or higher than 26.68% The Agreement grants the County the right to obtain up to 15% of the carbon credits generated by the LFG Project through a carbon credit-exchange mechanism. The County's payments also may be adjusted to account for changes in methane's global warming potential and UNC's generation of renewable energy credits. Term: Twenty years with two five-year renewal terms exercisable at UNC's option. If both options are exercised, the Agreement will run for thirty years. Dispute Resolution: All disputes, except those requiring immediate injunctive relief, are submitted to an escalating negotiation and non-binding mediation process. If such efforts are unsuccessful, either party may resort to litigation. From the University's perspective the primary goal of the project is to work towards carbon neutrality at the Carolina North Campus, and significantly reduce the carbon footprint of the entire UNC-Chapel Hill system. The use of landfill gas as an alternative fuel for both thermal and electric energy production is an important component of achieving this goal. Orange County is committed to addressing the problems and priorities of its residents, and taking a leadership role among local governments with respect to climate change. FINANCIAL IMPACT: There will be no financial impact related to receiving the project negotiations update. However, if and/or when a final agreement is presented to the BOCC for approval, there will be income generated to the Solid Waste Enterprise Fund for the period of the agreement that could range from $115,000 to $140,000 annually with the potential for an