Work Session

Mayor and Council Work Session and Executive Session November 17, 2015 Agenda "A diverse, business-friendly, and sustainable community with clean, safe and strong neighborhoods." "Providing the most efficient and highest-quality services as the municipal location of choice for all customers." "Even if something is left undone, everyone must take time to sit still and watch the leaves turn." Elizabeth Lawrence EXECUTIVE SESSION 3:30 PM 1. Executive Session Agenda 4:00 PM WORK SESSION 4:00 PM 1. Preliminary Agenda Review 4:15 PM 2. Customized Energy Solutions/Alevo Energy Storage System Project 4:30 PM 3. "Gigabit City" Discussion with Antietam Cable CITY ADMINISTRATOR'S COMMENTS MAYOR AND COUNCIL COMMENTS ADJOURN  REQUIRED MOTION MAYOR AND CITY COUNCIL HAGERSTOWN, MARYLAND Topic: Executive Session Agenda Mayor and City Council Action Required: Discussion: Financial Impact: Recommendation: Motion: Action Dates: ATTACHMENTS: File Name Description November_17_2015_Executive_Session.pdf Agenda  EXECUTIVE SESSION MAYOR & CITY COUNCIL NOVEMBER 17, 2015 AGENDA 3:30 p.m. EXECUTIVE SESSION – Room 407, 4th floor, City Hall 1. To consider a matter that concerns the proposal for a business or industrial organization to locate, expand, or remain in the State, #4 *Business Proposal – 2 items *AUTHORITY: Annotated Code of Maryland, State Government Article, Section 10-508(a) (Subsection is noted in parentheses) CITY OF HAGERSTOWN, MARYLAND PUBLIC BODY: Mayor & City Council DATE: November 17, 2015 . PLACE: Room 407, 4th floor, City Hall TIME: 3:30 p.m. . AUTHORITY: ANNOTATED CODE OF MARYLAND, STATE GOVERNMENT ARTICLE: Section 10-508(a): 1. To discuss: [ ] (i) the appointment, employment, assignment, promotion, discipline, demotion, compensation, removal, resignation or performance evaluation of appointees, employees, or officials over whom it has jurisdiction; or [ ] (ii) any other personnel matter that affects 1 or more specific individuals; [ ] 2. To protect the privacy or reputation of individuals with respect to a matter that is not related to public business; [ ] 3. To consider the acquisition of real property for a public purpose and matters directly related thereto; [X] 4. To consider a matter that concerns the proposal for a business or industrial organization to locate, expand, or remain in the State; [ ] 5. To consider the investment of public funds; [ ] 6. To consider the marketing of public securities; [ ] 7. To consult with counsel to obtain legal advice; [ ] 8. To consult with staff, consultants, or other individuals about pending or potential litigation; [ ] 9. To conduct collective bargaining negotiations or consider matters that relate to the negotiations; [ ] 10. To discuss public security, if the public body determines that public discussions would constitute a risk to the public or public security, including: (i) the deployment of fire and police services and staff; and (ii) the development and implementation of emergency plans; [ ] 11. To prepare, administer or grade a scholastic, licensing, or qualifying examination; [ ] 12. To conduct or discuss an investigative proceeding on actual or possible criminal conduct; or [ ] 13. To comply with a specific constitutional, statutory, or judicially imposed requirement that prevents public disclosures about a particular proceeding or matter; or [ ] 14. Before a contract is awarded or bids are opened, discuss a matter directly related to a negotiation strategy or the contents of a bid or proposal, if public discussion or disclosure would adversely impact the ability of the public body to participate in the competitive bidding or proposal process. [ ] 15. Administrative Function  REQUIRED MOTION MAYOR AND CITY COUNCIL HAGERSTOWN, MARYLAND Topic: Preliminary Agenda Review Mayor and City Council Action Required: Discussion: Financial Impact: Recommendation: Motion: Action Dates:  REQUIRED MOTION MAYOR AND CITY COUNCIL HAGERSTOWN, MARYLAND Topic: Customized Energy Solutions/Alevo Energy Storage System Project Mayor and City Council Action Required: Discussion: Financial Impact: Recommendation: Motion: Action Dates: ATTACHMENTS: File Name Description Memo_for_CES_Alevo_Lease_Agreements_111715.pdf Memo Electric_Division_ALEVO_Fairground_Substation_Screening_111715.pdf Exhibit One  City of Hagerstown Department of Utilities 425 East Baltimore Street 1 Clean Water Circle 51 West Memorial Blvd Hagerstown, MD 21740-6105 Hagerstown, MD 21740-6848 Hagerstown, MD 21740-6848 November 17, 2015 TO: Valerie Means, City Administrator FROM: Michael S. Spiker, Director of Utilities Nathan Fridinger, Electric Operations Manager SUBJECT: Customized Energy Solutions/Alevo Energy Storage System project ACTION: Requested Approval of Lease Agreements for Fairground and Wesel Substations HLD Staff, FERC Legal Counsel Tom Rudebusch, and the ALEVO/Customized Energy Solutions team have completed the Lease Agreement negotiations that were last discussed with the Mayor and Council on August 18th. I have prepared bulleted items for review which contain the background review of the project and the pertinent points of the agreements for locations at the HLD Fairground Substation and Wesel Substation. Customized Energy Solutions/Alevo Background  The HLD has a long standing relationship dating back to 2002 with Customized Energy Solutions (CES) through the Public Power Coalition (PPC), as our liaison with all PJM activities. CES documents and reviews all PJM related information that is crucial to our decision making process related to generation/transmission issues.  Alevo Group SA is based in Verbier, Switzerland and opened a new 4 million sq. ft. manufacturing plant in Concord, North Carolina in October 2014. The company plans to invest $1 billion into the manufacture of its battery technology and reduce waste that currently exists in electric grid delivery systems.  Alevo classes itself an Energy Service Provider that uses a combination of innovative battery technology and smart data analytics to reduce a huge part of the 30% generated electricity that is currently wasted through inefficiencies in the grid delivery system. Proposed Project  The project will consist of utility scale Energy Storage Systems installed at two sites within the City of Hagerstown. The projects at these two sites (Wesel Substation and Fairgrounds Substation) will operate behind the meter as “demand response” resources participating in the PJM Regulation ancillary service market and provide PJM system grid reliability services, specifically voltage and frequency support. The projects have been sized to ensure that they remain behind Hagerstown’s meters and do not inject into the Potomac Edison system. Page 1  Alevo has invented a battery technology that is the core component of its GridBank System where each  2MW unit is an approximately 10 ft. x 40 ft. pre-fabricated structure. The current study utilizes 10MW of battery storage (two structures at Fairground Substation and 3 structures at Wesel Substation).  The active ingredients of the Alevo cells are LFP (lithium ferrophosphate) and graphite. Unlike typical rechargeable lithium ion batteries, such as those found in most consumer electronics devices, the Alevo lithium cell contains an inorganic electrolyte and as such is completely non-flammable.  An ESS operates by storing electricity that was generated on the system grid and discharging it when system requirements demand it. It is considered a sustainable/renewable resource due to the fact it does not create emissions when called upon to operate.  Full screening of the Fairground site will be submitted for final approval by the City. Lease Agreement Provisions  Lease Agreements located at the Hagerstown Light Department’s Wesel (6MW system) and Fairground (4MW system) Substations are to be used solely for the purpose of the installation of Energy Storage Systems.  The initial term of the agreement is 10 years and contains provisions for 2 five year extensions if mutually agreed upon. Fairgrounds Substation shall receive $2000 per month and Wesel Substation shall receive $3,000 per month for the term of the agreement.  The HLD shall provide existing and available utilities to the Project Site in connection with ALEVO’s construction, start-up, maintenance, repair, replacement and operation of the Project, at existing rates or actual cost, as appropriate.  The Fairground Substation agreement contains provisions for a temporary staging area of 3600 square feet for approximately six weeks at the far west side of the parking lot nearest the substations. Ten parking spots will be affected.  Easements and rights of entry are granted at the site locations. The Wesel Substation location will house the ALEVO facility within the existing substation footprint. An easement will be granted between the proposed ALEVO facility and the HLD Substation at the Fairground Substation for electric connectivity.  The City possesses the option to request the removal of the equipment at the end of the agreement or for the equipment to remain in place. ALEVO is permitted to choose one of the two options.  ALEVO has the option to transfer the provisions of the agreements after a 60 day notice is supplied to the City. All agreement provisions and payments remain in place.  ALEVO is responsible for the leased area and associated equipment maintenance, security, and safe operation. Specifically, the “ALEVO shall maintain the Facility in a structurally sound and safe condition consistent with all Applicable Laws.”  This Agreement shall be governed by the laws of the State of Maryland, including principles of good faith and fair dealing that will apply to all dealings under this Agreement.  Commercial general liability insurance, with limits of not less than $1,000,000 per occurrence and $2,000,000 in the aggregate are included. Excess liability insurance, with a limit of not less than $5,000,000, and Workers’ Compensation Insurance of not less than $1,000,000 for bodily injury per occurrence and $2,000,000 in the aggregate are provided.  Summation: The HLD will receive $60,000 per year in lease agreements, revenue from the sale of electricity for ancillary requirements of the systems, and may supply other maintenance type services for the project during construction and operation. ALEVO has verbally committed to the utilization of local contractors when applicable during the construction process. Page 2 Phone 301.739.8577 ext. 143 Electric Fax 301.739.7958 TDD 301.797.6617 Phone 301.739.8577 ext. 650 W/WW Fax 301.733.2873 TDD 301.797.6617  REQUIRED MOTION MAYOR AND CITY COUNCIL HAGERSTOWN, MARYLAND Topic: "Gigabit City" Discussion with Antietam Cable Mayor and City Council Action Required: None. Discussion: Financial Impact: Recommendation: Motion: Action Dates: ATTACHMENTS: File Name Description ACTV_111715.doc Cover Memo  CITY OF HAGERSTOWN, MARYLAND Department of Community & Economic Development November 12, 2015 TO: Valerie Means, City Administrator FROM: Scott Nicewarner, Director – Technology and Support Services RE: “Gigabit City” Discussion with Antietam Cable BACKGROUND: Brian Lynch, President of Antietam Cable and Vice President of Cable Operations for Schurz Communications, will be on hand with me for the November 17 Mayor and Council work session to discuss their implementation of fiber-to-the-premise in our City Center and immediate surrounding area. He will be able to expand upon the project as well as answer any questions specific to their implementation. COUNCIL ACTION REQUIRED: None. DCED • 14 North Potomac Street Suite 200A • Hagerstown, MD 21740-4987 www.hagerstownmd.org fax: 301-739 - 6322