Agenda - 12-11-2008 - 3a - Laserfiche WebLink

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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. Termination Milestones: The Agreement calls for the University to make interim payments at precise calculations (10. 95% of heating energy content multiplied by natural gas price) to the County if the Engine Start Up Date has not occurred within 35 months of the Effective Date; and adjusts upward (16.6 % of heating energy content multiplied by natural gas price) if the Engine Start Up Date has not occurred beyond 60 months. The County also retains the right to terminate the agreement entirely if the University fails to complete the Landfill Gas Collection System within 5 years of the Closing Date. University and County representatives will participate in monthly progress meetings to ensure good faith and full cooperation in meeting and/or exceeding milestones. The "Closing Date" is when the County executes the agreement; the "Effective Date" is when the County legally grants the easements needed. 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. The University has expressed a primary interest through this joint project of achieving carbon neutrality at the Carolina North Campus, and significantly reducing 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 environmental and energy needs and concerns 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 additional $3,500 to $40,000 annually from the sale of renewable energy credits. The actual income will be variable and based on landfill methane output, natural gas price fluctuations, federal greenhouse gas policy and other economic externalities. RECOMMENDATION(S): The Manager recommends the Board receive the presentation on the proposed UNC/Orange County Landfill Gas Recovery Agreement and provide any direction and feedback to County staff on finalizing the agreement for BOCC consideration at its meeting on January 22, 2009.