GENERAL COMMITTEE
	TO:	Mayor and Members of Council
	FROM:	Jim Sales, Commissioner of Fire and Community Services
	PREPARED BY:	Bruce Ander, Markham District Energy Mavis Urquhart, Manager, Environmental Leadership
	DATE OF MEETING:	2005-Mar-21
	SUBJECT:	Report on Funding Request for a Solar Thermal District Energy Feasibility Study

RECOMMENDATION:

That the staff report entitled “Report on Funding Request for a Solar Thermal District Energy Feasibility Study” dated March 21, 2005, be received;

And That an application for funding be made to the Green Municipal Fund on behalf of the Town of Markham by Science Applications International Corporation Canada for a Solar Thermal District Energy Feasibility Study, as described in this report;

And That funding be approved to an upset limit of $25,000 from the Markham Environmental Sustainability Fund to cover the Town’s share of the cost of preparing the feasibility study;

And That the Town’s contribution to the cost of preparing the study be conditional on Times Group Corp. contributing matching funds (25% of the cost of the study);

And That the Town of Markham Environmental Sustainability Fund be reimbursed for the study cost by Markham Energy Conservation Office if Powerstream approves the Thermal Storage and Fuel Switching Pilot.

PURPOSE:

The purpose of this report is to request authorization and funding to undertake a feasibility study for a solar thermal district energy project. This study will examine the technical and economic feasibility of this project for a residential development in the Town of Markham.

BACKGROUND:

The following is a brief description of events leading up to this report:

December 2004 – Initial meeting held with Parties

In the fall of 2004, Councillor Erin Shapero contacted FCM’s Green Municipal Funds (GMF) representatives to discuss the possible collaboration between them, the Town of Markham, and a private developer (Times Group Corp.) for a solar thermal district energy project in the Town of Markham. FCM’s Green Municipal Fund representatives expressed an interest in developing a solar domestic hot water heating project which would bring together Federal, Provincial, Municipal and private sector partners as a model for future partnership projects across Canada.

A meeting was then held in December 2004, in Markham, to discuss the project and to determine next steps. Those in attendance included:

1. Times Group Corp: Hashem Ghadaki, President and Saeid Aghaei, Vice-President;

2. Town of Markham: Councillor Erin Shapero and Deputy Mayor Frank Scarpitti;

3. FCM’s Green Municipal Funds: Sandor Derrick, Project Development Manager

4. Science Applications International Corporation (SAIC Canada): Bill Wong, Program Manager, Renewable Energy and Climate Change

The FCM’s Green Municipal Fund representative indicated that FCM would be supportive of an application to the Green Municipal Fund for financial assistance for a feasibility study. It was then agreed that participation by Markham District Energy and Powerstream should be explored. It was confirmed that Science Applications International Corporation (SAIC) would have the required expertise to undertake the feasibility study.

February 7, 2005 – Second Meeting Held with Parties

A second meeting was held on February 7, 2005, in Markham to discuss the project in more detail, to examine the partnerships and to determine next steps. Those in attendance included:

1. Times Group Corp: Hashem Ghadaki, President

2. M. V. Shore: Bill Chan (engineers for Times Group Corp)

3. Town of Markham: Councillor Erin Shapero, Deputy Mayor Frank Scarpitti, John Livey, CAO, Jim Baird, Commissioner of Development Services

4. Green Municipal Funds: Sandor Derrick, Project Development Manager)

5. Science Applications International Corporation (SAIC Canada): Bill Wong, Program Manager, Renewable Energy and Climate Change

6. Markham District Energy: Bruce Ander, President

7. Powerstream: Brian Bentz, President

Following a technical presentation by Bill Wong it was generally agreed to proceed with an application to the Green Municipal Fund with the following funding partners for the feasibility study to an upset limit of $100,000:

· FCM Green Municipal Fund: 50%

· Town of Markham’s Environmental Sustainability Fund: 25%

· Times Group Corp: 25%

March 8, 2005 – Presentation by B. Ander made to Committee of the Whole

On March 8, 2005, Bruce Ander, Markham District Energy, made a presentation on this project to the Committee of the Whole. The presentation is attached to this report as Appendix 1, for information.

DISCUSSION

The objective of the feasibility study would be to identify opportunities for solar domestic hot water as a stand alone system, or, as part of an integrated energy system. The study tasks of the proposed 20 week workplan would include:

· Estimate residential development heating and cooling demand and loads.

· Screen concepts and identify workable options.

· Develop system conceptual design.

· Estimate system implementation costs.

· Perform economic analysis; energy pricing drivers, funding options, emission trading opportunities, tax incentives.

· Develop recommendations.

· Issue Report.

A copy of the proposed scope of work for the feasibility study is attached for information.

This report proposes that a funding application for the feasibility study (up to a cost of $100,000) be submitted to the Green Municipal Fund and that the Town of Markham contribute up to $25,000 to that study through the Markham Environmental Sustainability Fund.

The Markham Energy Conservation Office has proposed a Thermal Storage & Fuel Switching Pilot project ($355,000) to be funded from Powerstream’s approved Conservation & Demand budget. Part of this pilot program includes $30,000 for the Solar Thermal feasibility study. If the pilot is approved, Markham ECO would then reimburse the Town’s Environmental Sustainability Fund. Therefore, it is proposed that the Town of Markham fund the feasibility study with the expectation, but not a guarantee, that Markham ECO would reimburse the Town if Powerstream funds the Thermal Storage & Fuel Switching Pilot.

Finally, FCM’s Green Municipal Funds (GMF) representative has advised Markham that the application for funding of the feasibility study must be submitted prior to March 25, 2005 to be considered this year.

FINANCIAL CONSIDERATIONS

This report recommends that the Town’s funding share (up to $25,000) for the feasibility study come from the Markham Sustainability Fund with the expectation, but not guarantee, that Markham ECO will reimburse the Town of Markham in the event that Powerstream agrees to fund the Thermal Storage and Fuel Switching Pilot.

BUSINESS UNITS CONSULTED AND AFFECTED:

The following business unit was consulted in the preparation of this report:

• Finance Department

CONCLUSION

This project represents an opportunity for Markham to explore the development a Solar Thermal Energy power source which will bring together Federal, Provincial, Municipal and private sector partners as a model for future partnership projects across Canada.

Stuart Taylor, Director, Strategic Services Department

Jim Sales, Commissioner, Community and Fire Services

Appendix 1 – Presentation to Committee of the Whole by Bruce Ander – March 8, 2005

Q:\Strategic Services\Members\Victoria McGrath\Reports\2005 Reports\Solar Thermal Distrcit Feasibility Study.doc