Label
Renewable Natural Gas Project Agreement
DPS Solid Waste/DPU Water Recreation
Megan Robson (x2306)/Ryan Murphy (x2640)/Andrew McClure (x7866)
Revised
Title
Authorizing the Mayor to enter into agreements with NW Natural Renewables, LLC for a Renewable Natural Gas project utilizing Hoffman Road Landfill Gas and Bay View Waste Water Treatment Plant digester gas; authorizing the acceptance of incentive payments and revenue; and declaring an emergency.
Body
SUMMARY & BACKGROUND:
This ordinance authorizes the City to enter into a 20-year biogas rights agreement, lease agreement, and operation and maintenance agreement with NW Natural Renewables Holdings, LLC’s wholly owned subsidiary, Toledo Renewable Energy, LLC (NWNR) for a renewable natural gas (RNG) project utilizing Hoffman Road Landfill gas and Bayview WWTP digester gas. The goal of this project is to make City operations more sustainable by decreasing greenhouse gas emissions, while also bringing in revenue.
The City posted a Request for Qualifications on Planet Bids on September 30, 2023. Ten responses were received on November 7, 2023 and evaluated in accordance with TMC 187.24 (Competitive Proposals). Five firms were selected to interview, which occurred in February and March 2024. The interview panel selected NWNR as the best firm to enter into an agreement to complete an RNG project at this time. Since then, negotiations and agreement development activities have been occurring.
The City is not expending any capital dollars for the development, implementation or operation of this project. NWNR will pay all up-front capital costs for development and implementation, and will own the gas rights and the gas treatment and processing equipment they install. They will lease property and certain equipment at the Hoffman Road Landfill and Bayview WWTP and will have an operations and maintenance agreement for the landfill gas collection and control system.
Revenue to the City will be based on the metered quantity of conforming gas delivered to the project, independent of natural gas market values. Proposed economic project incentives include a $1M contract signing incentive, a $0.5M payment to the City upon commencement of operations, and an estimated 20-yr project revenue to the City of $13M to $25M based on projected gas delivered to the project after NWNR makes capital improvements to the landfill gas system. Furthermore, this project offsets approximately 16,500 metric tons of greenhouse gas emissions (CO2e) released annually into the atmosphere (equivalent to removing approximately 4,000 vehicles a year).
Summary
NOW THEREFORE Be it ordained by the Council of the City of Toledo:
SECTION 1. That the Mayor is authorized to enter into a biogas rights agreement, lease agreement and operations and maintenance agreement with NW Natural Renewables, LLC for the development and implementation of an RNG project utilizing gas from the Hoffman Road Landfill and Bay View WWTP Digesters upon terms and conditions acceptable to the Director of Public Service, the Director Public Utilities and the Director of Law.
SECTION 2. That the City is authorized to accept and deposit an incentive payment, as well as any additional incentive sharing related to project tax credits to Account Code………
SECTION 3. That the Mayor is authorized to accept and deposit revenues generated from the sale of landfill gas and digester gas, per the agreements referenced in Section 1 to Account Code…
SECTION 4. That this Ordinance, being an emergency measure, shall take effect and be in force from and after its passage. The reason for the emergency lies in the fact that the Ordinance is necessary to take advantage of ITC tax credits and for the immediate preservation of the public peace, health, safety, and property.
Vote on emergency clause: yeas _____, nays _____.
Passed: _________________, as an emergency measure: yeas _____, nays _____.
Attest: ________________________ __________________________________
Clerk of Council President of Council
Approved: _____________________ __________________________________
Mayor
I hereby certify that the above is a true and correct copy of an Ordinance passed by Council ________________________.
Attest: ________________________
Clerk of Council