ENRA Extension with Menard Battery Storage, LLC was Denied

During a special meeting held by the Vacaville City Council, Wednesday, January 10, 2024, the City Council denied Menard Battery Storage, LLC an extension of their Exclusive Negotiations Rights Agreement. 

Background

January 10, 2023, the City Council approved an agreement that allowed Menard Energy to evaluate the construction of a battery storage facility at the former Gibson Canyon Creek Wastewater Treatment Plant in north Vacaville. The agreement did not approve a battery storage facility or obligate the City to an approval. Rather, the agreement allowed Menard Energy to conduct due diligence about the property and explore, with the City of Vacaville, the potential to purchase the property and develop it with a battery storage facility. Due diligence included Menard’s analysis of the financial feasibility of a battery storage facility, site investigation to examine the site’s physical characteristics, and review of other potential site development issues. 

Related documents:

• Prior ENRA Agreement, expired January 11, 2024
• ENRA Extension Request Letter
• Menard BESS Project Website
• City Council Report, January 10, 2023

Location

The site is located on the east side of Leisure Town Road north of Mills Road. Primary access to the site is provided via a private driveway accessed from Leisure Town Road.

Overview

Under a 12-month exclusive negotiating rights agreement with the City of Vacaville, Menard Energy Storage, LLC (Menard Energy) evaluated the feasibility of building a BESS facility at the former Gibson Canyon Creek Wastewater Treatment Plant in north Vacaville.  At the time in 2023, there were over 500 utility-grade BESS facilities operating throughout California and the United States.  These facilities consist of banks of batteries that are housed in fireproof metal containers.  These batteries harvest energy from natural sources (sun, wind) and sell it when there is demand.  This increases grid reliability and helps meet the nation's and California’s clean energy goals.

Menard Energy did not file a formal application, and the land sale and project were not approved by the City of Vacaville. If Menard Energy had moved forward with a formal proposal under the ENRA, they would have been required to file the following applications with the Community Development Department:

1. General Plan Amendment;
2. Zoning Ordinance Text Amendment;
3. Development Agreement;
4. Airport Area of Influence Review;
5. Conditional Use Permit;
6. Design Review; and
7. Environmental Assessment.

As part of the development review process, a project would be reviewed for compliance with the California Environmental Quality Act (CEQA) and it is likely a full environmental impact report (EIR) would be prepared.  Based on the types of applications that would be required, the City Council would make the final decision on whether to allow battery storage on the site.

Questions & Answers

During the Septyember 7, 2023 City of Vacaville hosted community meeting regarding the proposed Vacaville Menard Battery Energy Storage System (BESS) facility project, attendees identified many questions about the proposal. City staff worked with project proponents to develop a set of answers to questions asked during the meeting and online: View Menard Battery Storage, LLC questions and answers.

The City of Vacaville hosted a community meeting on September 7, 6:00 to provide additional information about the background of the preliminary agreement, information about Menard Energy’s proposed battery storage project, and an opportunity for the community to ask questions. Property owners within 1000 feet of the proposed project were notified by mail and interested residents who subscribe to the City’s email list were notified about the meeting via email. Following the meeting, City staff has been working with the Menard Energy team to develop written responses to questions raised by the public at and prior to the meeting.

The meeting was live streamed and a recording can be accessed on YouTube. 

Presentations

City of Vacaville Presentation [English] [Spanish]

Menard Energy Presentation [English] [Spanish]

On March 2, 2023, Menard Energy filed a preliminary review application with the Community Development Department to obtain initial feedback on a preliminary design, which includes battery storage and a recreational facility. On April 14, 2023, City staff sent Menard Energy detailed comments and questions about the preliminary design.

City Comment Letter

Project Information via eTRAKit,  Search value: 23-020

If Menard Energy moves forward with a formal proposal, they will be required to file the following applications with the Community Development Department:

(1) General Plan Amendment;
(2) Zoning Ordinance Text Amendment;
(3) Development Agreement;
(4) Airport Area of Influence Review;
(5) Conditional Use Permit;
(6) Design Review; and
(7) Environmental Assessment.

Based on the types of applications that would be required, the City Council would make the final decision about whether or not to allow battery storage on the site. As part of the development review process, a project would be reviewed for compliance with the California Environmental Quality Act (CEQA). The level of CEQA analysis will be determined by City staff if the project is formally submitted. The CEQA process provides additional ways for community members to participate in the decision-making process.

If an application is submitted, the City would send a “Notice of Application” to all property owners within 1000 feet of the proposed project site and to the email list. There would be a series of community meetings during the development review process. The Planning Commission would review the project and make recommendations to the City Council. City Council would make the final decision about whether to approve the battery storage proposal.

Since April, Menard has continued evaluating the site and providing the City with updates, as required by the agreement. One of the topics under discussion between City staff and Menard Energy is about community benefits. If Menard Energy moves forward with a formal development application, they are required to propose a community benefit. The City Council will determine which community benefit is acceptable to the City as part of the process. At this time, Menard Energy has not submitted a formal application to develop the site.

The former Gibson Canyon Creek Wastewater Treatment Plant (Gibson Plant) was operated by the City to serve two users: Albertson’s Distribution Center and Mariani Packing Company. Gibson Plant operations resulted in groundwater contamination from unlined ponds, and a groundwater remediation system was constructed in 2005/2006. Wastewater flows to the Gibson Plant ceased in December 2006 as ordered by the Regional Water Quality Control Board. The final closure of the Gibson Plant was completed and approved by the Regional Water Quality Control Board on January 20, 2009.

Under the Surplus Land Act, Government Code Section 54200- 54232, surplus property is defined as "land owned by any agency of the state, or any local agency, that is determined to be no longer necessary for the agency's use, except property being held by the agency for the purpose of exchange." On February 25, 2020, the City Council approved Resolution 2020-030 <LINK TO RESO> which authorized the City Manager to initiate the marketing of the subject property through the Surplus Land Act (SLA) process.

As part of the process, the City notified State of California Housing and Community Development (HCD) that the property had been designated surplus local land. All local public entities, special districts, and HCD’s list of developers were also notified. The City received no letters of interest for the property. Shortly thereafter, the City received formal approval from HCD that the City could sell the property to an end-user of its choosing.

February 25, 2020, City Council Meeting Report

In August 2020, City staff received a formal proposal from Menard Energy to develop a utility scale battery storage facility on the subject property. In November 2020, the City Council directed staff not to proceed with an agreement to allow Menard to explore the proposed battery storage facility project on the subject property. Council further directed staff to advise Menard Energy to explore alternative sites that were located in industrial areas.

Since that time, Menard Energy explored alternative sites, revised the design of their initial proposal, and provided the City with more insight about the operations and safety of the proposed use. Menard Energy believes that the Gibson Canyon property is the optimum site for a battery storage facility due to its close proximity to the PG&E Vaca-Dixon Substation and its power source.