CAPT Clayton Mitchell - Association of Defense Communities
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Transcript CAPT Clayton Mitchell - Association of Defense Communities
Navy Use of § 2922 Authority
CAPT Clayton Mitchell
NAVFAC Energy Office
2011 ADC WINTER FORUM | PAGE 1
Key Energy Legislative Provisions
10 USC 2922A
Establishes contract duration for provision and operation of energy
production facilities.
10 USC 2917
Permits Secretary of military department to develop geothermal
resources beneath withdrawn public lands.
10 USC 2916
Permits military to sell, or authorize the sale by a contractor of
electricity produced from alternate energy or cogeneration facilities.
Funds to be invested in account for electricity.
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10 USC § 2922A Authority – Contracts for Energy
Contract up to 30 years in duration
Purchase energy either from:
production facilities on real property under SECNAV jurisdiction or;
on private property
Requires SECDEF approval
Sometimes (mistakenly) referred to as the Power Purchase
Agreement (PPA) statute.
2011 ADC WINTER FORUM | PAGE 3
DON Applications of §2922A
None to date.
China Lake Geothermal often mistaken as under § 2922A.
Miramar Land Fill Gas (currently in-progress) would represent DON’s initial use of § 2922A
authority
Potential future opportunities at:
o
o
o
29 Palms (Solar )
NSWS China Lake (Solar)
NAS Fallon (Solar)
Navy interpretation of § 2922A1
Section A references §2917 – authorizes geothermal energy resource
development.
Section A2 references provision and operations of an energy production facility
(not specifically renewable or geothermal) on land under jurisdiction of the
Secretary concerned or on private property.
Navy interprets that withdrawn land would fall under the jurisdiction of the
Secretary concerned.
o Except when the withdrawal notice notes specific conditions:
Executive Order
Other statues
2011 ADC WINTER FORUM | PAGE 4
China Lake Geothermal Plant
Contractual Overview
• Public/Private Venture
• Generally considered a “revenue” contract vs FAR
contract.
• DON can take revenue or power
• Not considered a FAR Contract because it does not
involve the expenditure of appropriated funds for
either services or supplies.
Production Capacity
• Power Plants (4) – Navy (2)/BLM (2)
• Net Production Output: 270 MW
• Infrastructure
• Several FAR clauses have been incorporated into
the contract
• §2922A often mistakenly cited as the enabling
authority for China Lake plant.
• Originally authorized under 10 USC § 2867 and
2889; the precursor to § 2917
Turbine-Generator Sets: (9)
Transmission Lines: (2)
Productive Wells: (166)
Piping (Linear Feet): +200,000
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Miramar Landfill Gas Overview
•
Contractor Scope:
•
Government Scope:
•
Develop/ construct/ operate/ maintain renewable power generation facility
Methane gas extracted from landfill (15 years - § 2922A)
Located on MCAS Miramar real property leased to the city of San Diego
3 MW Renewable Energy at MCAS Miramar
25,542 MWH annual capacity/ 18,809 MWH/yr minimum delivery
Contractor to deliver renewable power NLT (9) months after contract award
Construct/ own/ operate/ maintain power transmission infrastructure to new facility
Strategic Objectives:
Reduce MCAS Miramar’s reliance on fossil fuels
At a later date, the Government may negotiate provisions to include “Black Start” capability to
mitigate electric grid failure
USMC to retain Renewable Energy Credits
Pre-established price for predictability and budgetary planning
Potential delivery of 33% to 50% of installation’s annual mission essential energy requirement.
Miramar Challenges
Coordination of multiple contracts
Government construction of transmission/distribution lines
o Portion of the transmission lines funded under ARRA – should be awarded after PPA is
awarded.
o If transmission line completed but PPA not awarded, then no complete and usable system.
Contractor construction of production facility
Power Purchase Agreement for commodity utility
o Take or Pay Legal Considerations
o Termination Clause Legal Considerations
QUESTIONS?
China Lake Geothermal Plant History
• Project Location: NAWS China Lake
• Key Milestones:
Start Initial Testing: 1964
Test Initial Well: 1977
Initial Contract Award: 1979
California Energy Corporation
Follow-on contractor: Terra-Gen
Contract Renegotiation (30 years): 2005
• Type of Contract: “Unique”
Navy receives negotiated percentage of
contractor’s gross revenue up to ceiling of 20%.
• Business Model Revision Underway
Co-locate solar PV or wind with geothermal
wells.
Share transmission line with geothermal power.
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