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Special Bd. of Aldermen — 08/06/2019 Page 18

Mr. Hasselbeck It depends on the project. So we can do either; in this case we have all examples. So all the
inverters are rated to be mounted externally, so if we need to put them outside, that is what they are designed
for. If in the top left, that’s the case where we had some spare space available in an electrical/mechanical room.
If that’s an option, we’d love to take that option. Another option on the top right, we mounted those inverters
right on the roof surface itself, so that’s another option. So if esthetics were a concer we could include.

Commissioner Garant

My concern is the array of conduit on that building surface which after you have designed the building to make it
look esthetically pleasing, particularly a Fire Station, then we end up with 20 rows of conduit. Is that always
necessary?

Mr. Hasselbeck Yeah it’s a great question. No it’s not, so first of all esthetics actually does play into our design
because we firmly believe that our solar adoption rate is 1% so there is a lot of opportunity there. These
municipal projects are so valuable because they are offering community residents first exposure to solar and if it
looks ugly that is not going to be a positive experience. And that doesn’t help anybody, right? In that specific
case, that’s actually in the City of Keene, that system is gigantic so it is a massive power plant. That specific
location is on the rear of the building sandwiched between the dumpsters and where they park the Zamboni. So
we do take that into account. | want to be clear, we are electricians not magicians and we do have to connect
our solar arrays to the inverters but | am not looking to put all that stuff rignt next to your front door, | guess.

Mr. Weeks And | am happy to advise on these specific properties because these are substantially smaller
arrays there is sufficient room. | think the plan, it hasn’t been all confirmed, we are still in that process working
with the managers of those facilities, but the plan is to locate those two or three inverters, not the 8 or 10 that
you see on larger arrays in those utility rooms and run interior conduit runs. That’s always our preference from
an esthetic standpoint and we should be able to do that in these cases.

Commissioner Garant

Thank you.

Mr. Weeks Thank you Commissioner.

Alderwoman Kelly

Thank you. We touched on maintenance of the panels. Is there any concern or issues that come up with the
roof maintenance once something is installed?

Mr. Hasselbeck Another great question that’s why we really feel strongly about due diligence prior to a solar
installation to essentially avoid major roof maintenance there. But in the case where this is say, what does
happen sometimes you know we saw the HVAC units up there. That is often, those heating and cooling units
typically do have penetrations, those are often the locations for roof leaks or areas of the roof that need
maintenance in the life cycle of a building. So our first approach is to avoid getting too close to those. But in the
event where you know we did need to move some panels, it is not a big deal to move a few solar panels. Itis a
big deal to remove all of them for a big re-roof. So a simple roof leak if that happened, you know, we are
moving only a handful of panels in that specific area so that’s very minimal exposure and very minimal cost.

Board of Aldermen Page 10
April 12, 2016

ON THE QUESTION
Alderman Dowd

As we were going through the school projects, we realized we would have some amount of savings from some
other projects listed here. When we were looking at the bonding, we realized that we would utilize these funds
and not increase the amount of bond. We had passed this in concept back quite a while ago. We had to wait
until we knew the exact funds in these accounts. We now know that and now want to transfer these funds so
we may complete Sunset Heights Elementary School HVAC project.

Alderman Deane

Clarification on the $228,956.44. Is that coming directly out of the school capital reserve fund, and if so, what’s
the sum total left in that account?

President McCarthy

It's not coming out of that account. It’s coming out of the capital account that the gym floor money was
transferred into by an earlier resolution. | couldn’t tell you off the top of my head exactly what's left in the
reserve fund.

A Viva Voce Roll Call was taken, which resulted as follows:

Yea: Alderman Wilshire, Alderman Clemons, Alderman Dowd, 11
Alderman Caron, Alderman Siegel, Alderman Schoneman,
Alderwoman Melizzi-Golja, Alderman McGuinness, Alderman LeBrun,
Alderman Lopez, Alderman McCarthy

Nay: Alderman Deane, Alderman Cookson, Alderman Moriarty 3
MOTION CARRIED
Resolution R-16-014 declared duly adopted.

R-16-015
Endorsers: Mayor Jim Donchess
Alderman Ken Siegel
Alderman-at-Large Brian S. McCarthy
Alderman-at-Large Lori Wilshire
Alderman Richard A. Dowd
Alderman June M. Caron
Alderman-at-Large Michael B. O’Brien, Sr.
ESTABLISHING AN EXPENDABLE TRUST FUND FOR STATE EMPLOYER PENSION COSTS
AND APPROPRIATING $2,230,000 FROM FUND BALANCE ASSIGNED FOR THIS PURPOSE
INTO THE EXPENDABLE TRUST FUND
Given its second reading;

Alderman Siegel

Typically | would make a motion for a final passage and move forward but this is a piece of legislation that
requires ten votes and we are missing an Alderman here. | believe that we could go through this entire debate
and come to a point where we vote on this at which point whatever the outcome is and we go through the
exercise of tabling and | would prefer not to waste the Boards the time unless it’s the pleasure of the Board.
So we go through the debate at a point where are all present. Of course, | can’t make that decision myself but

Special Bd. of Aldermen — 08/06/2019 Page 19

Mr. Weeks And it is worth noting Alderman Lopez asked the question about the roof condition, in addition to
reducing cooling loads by exactly how much we don’t know, hence not included in the financials, it will extend
the roof life. Those UV rays are the primary cause of the degradation of the roof itself. So covering that up,
soaking up those rays instead as the panels are designed to do, will have that additional benefit.

Alderwoman Kelly

And just to follow on, as we are starting to look at building projects, | would just be interested to know what we
can do to make it more solar friendly. So we have the Performing Arts Center coming up, we are talking about a
new school, what kinds of things can we do to make sure that they are solar friendly even if we don’t install it
right at that time?

Mr. Weeks Thank you so much for looking ahead and thinking ahead in that way and | would note to Alderman
Dowd’s question that we have had some conversations with members of the School Department and done
some preliminary designs. The two high schools each have capacity for about a megawatt, that would be ten
times the arrays you see here, so tremendous potential in the City in the future. | would say the short answer
Alderwoman Kelly is we are always grateful to be brought in early in the process. We are often working with
several municipalities and businesses, putting up new buildings at this point in time and advising their electrical
contractors on conduit runs, on spacing for inverters in the utility rooms so they don’t need to go outdoor
preferably, on roof type selection. So that is something obviously unique to a given project and their needs but
we are eager to provide that guidance at the get-go and certainly can do whether or not we are a chosen
vendor. We are happy to provide that input.

Alderman Dowd

Any new design building like the new school, the Performing Arts Center or anything like that, the architect and
the construction manager do a lot of the planning to allow for the solar array and they have a lot of that
responsibility to make sure it is done correctly and esthetically. So they would work with a solar company to
perform all that work but they’d do it in accordance with the drawings that they come up with.

Alderwoman Kelly

| think my question was if we were planning on it then definitely that would happen but if we are not and we are
just putting up a new building, are we at least thinking ahead and putting in roofs that can actually sustain this?

Alderman Dowd

Oh no we are way ahead and we are doing solar.

Alderwoman Kelly

OK.

Special Bd. of Aldermen — 08/06/2019 Page 20

President Wilshire

Anyone else? Thank you very much gentlemen, appreciate you being here. Oh you still have more
presentation. The financials.

Mr. Weeks | will move swiftly through this, naturally we certainly invite questions and appreciate the chance to
answer them as you’ve given us so far. Let me just briefly preface, I’m fortunate to be a local citizen and tax
payer here in Nashua. We deeply appreciate and respect, speaking on behalf of a company whose mission it is
to accelerate this transition from fossil fuel dependence to clean energy. We deeply appreciate and respect that
the Energy Committee here in Nashua has proposed to the Aldermen and | believe the Aldermen have
accepted their recommendation that the City move toward 100% clean energy. A very exciting goal that now
many communities across New Hampshire and the Nation have adopted.

Naturally, we are always thrilled to work with communities that have environmental goals as their primary
motivator but the financials matter too; speaking as a local citizen as well. So at the outset, when we are
approaching a project of this sort and frankly 9 out of 10 projects that we develop, we want to ensure at the
outset that this will provide a financial return to the community and to the business, whoever it may be. The
primary mechanism to achieve that with a municipality or any other non-profit, tax-exempt entity is what is called
a power purchase agreement. To give a couple of the kind of summary facts on power purchase agreements,
the challenge that we are seeking to overcome with PPA’s is that in their wisdom the Federal Government has
chosen to direct all incentives for solar, federal incentives, through the tax code. That means if you are
homeowner or a business owner and have a tax bill to the IRS you can take the 30% investment tax credit that
the Mayor alluded to, which steps down at the end of this year. You can depreciate the asset if you are a
business, but if you are a non-federal tax payer, such as a municipality, you have no access to that directly.

The solution which was developed, in fact, by the Federal Government, the National Renewable Energy Labs at
the Department of Energy over a decade ago and has been blessed by the IRS which is, in fact, the primary
mechanism by which large-scale solar has been implemented in the United States is this power purchase
agreement. As the name suggests, the City is not purchasing the array, the capital expense for the panels, the
inverters, the racking, etc., the City is purchasing the power that the array produces and feeds to its facilities at a
rate below the current utility rate. What this looks like is you have investors on the one hand who are providing
the capital to finance these projects and I'll show you what those specific numbers are on the next slide. They
are owning and operating the array, contracting with ReVision with James’ team to provide the O & M once we
have fully installed the system and permitted it. They are recouping their investment through that Federal
Investment Tax Credit and depreciation and some very modest environmental attributes renewable energy
credits and crucially from the sale of the electricity it produces to the City at that below market rate.

For the City’s part, the City is licensing the use of those two roofs and potentially future roofs or ground areas for
the purpose of installing solar. It is committing to buy the power from the array at the rate schedule set out in
that PPA contract. In order to maximize its long term savings, after 5 years, which is the minimum period of time
the investor must own the asset, it is the IRS recapture period on that tax credit; short of five years the investor
must return those tax incentives on a pro rata basis. But once we reach Day 1 of Year 6, the City may and is in
fact encouraged to for its financial benefit, acquire the array at a substantial discount and then generate its own
power going forward for the next 30 to 40 years.

The specifics for these two projects would be an initial cost to the investor of just over $500,000.00 and upfront
cost to the City of $0 because again you are not owning the array, you are simply purchasing the power from the
array. In order to make the investor whole and I'll say a word about the investors that we are fortunate to work
with, the City would be purchasing that power at a starting rate of 8.8 cents per kilowatt hour, rising 2% annually

Special Bd. of Aldermen — 08/06/2019 Page 21

thereafter for the duration of that PPA contract. Again, minimum 5 years; standard term of 25 years but those
buy out options are annual beginning in Year 6. So the City determines for how long they remain in the PPA.

If you were to exercise that option at the earliest possible point in Year 6 there would be a capital expense of
just over $300,000.00. That amount is pegged to fair market value as required by the IRS so the amount
declines each year thereafter. If the City were to defer that buyout as it may choose to do in that given year, you
aren't required to commit upfront, but once again the sooner you own the asset and are generating your own
power the greater the long term benefits. And then assuming that the City does exercise its buyout option in
Year 6, the net savings, so this is deducting the cost to buy it out at $300,000.00; the cost to maintain it were
you to contract with ReVision for this optional Operations Maintenance Contract; the modest degradation factor,
we model in a loss in production of half of 1% per year; hence a 40 year old system at 80% as we see today on
systems in the ground. We build in these factors, | noted earlier a full replacement of the inverters midway
through the system life, very conservative assumptions around utility, inflation and renewable energy credits.
Put all this together and our conservative estimates on savings for the City over the 25 year warranty period
come out to a little under half a million dollars. And then if you extend out to the minimum commercial life span
of 40 years, $1.27 million dollars.

To represent these numbers graphically for a moment, you see in the yellow line that is the solar PPA with that
early buy out in year six. So you have modest initial savings and we can circulate the more detailed financials,
but the City is purchasing the power from the array, that 8.8 cent rate is approximately 20% below current utility
costs. So you are saving roughly 20% on each kilowatt hour provided generated by the solar array. So relatively
modest initial savings without any capital cost. Were you then in Year 6 to buy out at about $300,000.00, you
would be payback sort to speak of between Year 6 and Year 12 or 13 of approximately 6 % years to recoup that
investment and from that point forward your savings are accumulating to the long-term figure of $1.27 million.

The blue line there is if you were to — your worst case scenario if you will, that is if the City determined to never
allocate the capital, to purchase the array; simply took that Power Purchase Agreement to the full 25 years and
then acquired it at a very, very low cost after 25 years, your long-term savings would be less but still strongly
positive. Just a final way of representing these same numbers which we think is worth understand and please
pardon the label. Initially we did present in the RFP for 5 sites, we are currently at 2. So on the right you see
the status quo scenario. So for these facilities which are Eversource Rate Class G, General Commercial the
current rate, the current cost of that electricity, when you factor in not just the supply, but the transmission,
distribution, costs all the line items on your bill that are charged on a volumetric basis per kilowatt hour, the
current is about $0.123 cents per kilowatt hour. To the left the utility line in gray is if we take the Federal
Government projections on utility cost inflation over the next several decades; the US Energy Information
Agency projects for New Hampshire, an average 2 72% per year inflation. WWe have seen more in recent years,
about 3% going back the last 15 years. We think it is prudent and conservative to use the Government
projections, a bit lower than that going forward. So those are your utility status quo scenarios in that assumption
an average cost over the next 40 years of that power of just over 20 cents per kilowatt hour.

While those are projections, the numbers on the left we can have a lot of confidence in. We know the size of the
array, the power output based on the modeling that our engineers do through Helioscope as we have described.
We know that the cost to operate and maintain the arrays, the cost of the buyout, the degradation factor,
building all of this in, we arrive at on the left a long-term leveled cost. So an average unit cost per kilowatt hour
over the lifespan of the solar equipment of $0.057 cents if you exercise the early buyout of $0.085 cents if you
do not buy out at any point but go the full 25 year term. Or were you to purchase up front $0.058 cents but
naturally that would require a significant capital outlay at the beginning without the flexibility to determine at a
future point if you choose to own it or not.

Special Bd. of Aldermen — 08/06/2019 Page 22

So that’s the financial summary. | am happy to take any questions you may have there and that really is the
substance of the proposal so we don’t want to take too much more of your time.

President Wilshire

| didn’t mean to cut you off.

Mr. Weeks It may just be worth if | may | recall one more slide that | threw in here and then we can talk a little
bit about kind of community engagement if you wish. But as to where that capital comes from, something that
ReVision takes a lot of pride in as part of our Mission as a Certified Benefit Corporation is extending — so we are
making solar available to non-profits and municipalities that in New Hampshire’s context with very limited State
incentives, would otherwise not have an opportunity to go solar. When you read about utility scale solar projects
the financing in almost every case comes from Wall Street where they are able to earn market level returns,
particularly if it is a State like California with substantial additional State incentives. In New Hampshire for
smaller scale projects with limited incentives, there unfortunately is not a commercial PPA investor market. We
just can’t sell these projects except rarely at very substantial scale. Projects at this size, simply don’t have
financing available in the existing solar investor market. Consequently what ReVision has worked to do over the
last several years beginning as a kind of proof of concept on our own balance sheet by directly investing in and
owning upwards of 70 non-profit power purchase agreements for various non-profits around the region. But in
the last 2 years, in order to bring added scale we have recruited and partnered with a number of mission-aligned
investors including for this project a family that lives here in this community and works in this community that is
blessed to have a large tax bill to the IRS which they through such an investment have the opportunity to
essentially redirect by investing that capital in solar projects, taking advantage of the existing tax incentives and
providing much lower cost financing than is otherwise available.

We call this program ReVision Solar Impact Partners, we have so far built over 120 of these PPA’s for other
municipalities and non-profits like the Soup Kitchen. That is why we believe or perhaps part of why we have the
opportunity to work with many smaller community organizations and smaller municipal projects thanks to these
investor partners who share our mission of deploying solar at lower cost. Let me shut up with that and welcome
any questions you may have on the finances.

Alderman Clemons

Yeah so when you did the .... because | know the City bulk purchases power, so when you did the market
analysis, did you factor what the City purchases power at in to your analysis?

Mr. Weeks We did. Because these two facilities will be net metering facilities they are not required to register
as net metering but because there will be excess production in peak summer months, they will under current
regulations require, will have to revert to default supply which would add were they purchasing net power would
add between a penny and two pennies per kilowatt hour. And Bob Hayden is the expert in the competitive
supply market and he can speak in more detail. So for these two facilities, they will require that reversion to
default supply. For your interest perhaps, as we look at larger scale projects at the airport or other offsite
locations which would be directly fed into the grid, they would through group net metering off set multiple City
accounts, but each of those participating accounts in such a group would retain the ability, as they do today, to
purchase that power on the third party competitive supply market rather than going to default. So default makes
sense in a situation like this where you are providing most of the power on site, so you are getting not in fact
from Eversource but from your own rooftop. And for larger scale projects we approve net meter to avoid that
requirement.

Special Bd. of Aldermen — 08/06/2019 Page 23

Alderman Clemons

OK. If | could continue? Knowing that makes you know | think, I’m glad that that was factored in because | think
this is for me anyway, this is no-brainer because it is no upfront cost to the City and regardless of whether or not
down the line we purchase the array on top of these buildings, we are going to be saving money. So as
somebody who is responsible for making sure that we are doing everything we can to save the tax payer a
dollar, not doing this would be foolish. So | certainly will support this project.

President Wilshire
Any other questions?

Mr. Weeks Well thank you so much, we threw a couple of just feel good in terms of community engagement,
James briefly mentioned that we love to come into the schools and educate. That moderating platform can be
made available to the entire community. And so we hope that if we have the opportunity to complete these
installations we can serve as a partner educating the community and helping to achieve maybe in my humble
opinion the most important slide here is the actual environmental benefits as a concerned citizen with young
kids as many of you, with kids or grandkids. These projects alone would have a very meaningful environmental
impact in terms of carbon pollution reduction. We thank you so much for your leadership and the opportunity to
present.

Mayor Donchess

Madam President, | think there are two things we should cover. Number 1 how soon does this need to be
approved in order to make this definitely feasible for this year. And Number 2 | was thinking we might ask Mr.
Hall who is representing Conway and their participation, these financials rely on their participation as well.
Maybe let him, Mr. Hall address any, | mean | know it is generally supported, but there is the lease issue, maybe
let him address this a little on that.

Charles Hall, President Board of Directors Conway Arena Charles Hall, 37 Chestnut Street, President of the
Board of Directors at Conway Arena. Thank you for inviting us. Representing our Board is Jim Conway, Tom
Monahan, Morgan Hollis, Brad Craig and Joe Bellevance Jr. So approximately 2002/2003 we entered into an
agreement with the City to build Conway Arena. We took a parking lot next to the DPW and built a beautiful
facility. It was approximately a $3.7 facility; we have a note of about $1.2. We are well on our way to paying
that off. Why we would like to extend the lease, so we have a 30-year lease. And with the addition of the solar
panels which is a great thing, this now gives us the ability in year approximately 2023, that 6" year that Dan
talked about of buying the array out for about $490,000.00. So in year ’23 we would probably want to take
another note for that, whether we need to take the full amount of what but this would be longer than a 7 year
note so this gives us that flexibility to do that. Also, although you said the roof will last forever? It probably will
but we'd like the flexibility that if at year 30 we need to replace the roof, it gives us that flexibility as well. So
what we would really like would be an additional 20 years which would make it a total of 50.

In giving back and hopefully everybody here agrees that we’ve been a real community supporter and have done
a good job as stewards for the arena. Alderman Caron and Mayor Donchess were at our event last week when
we gave over $50,000.00 as you mentioned, which actually now totals since 2004 we’ve give over $760,000.00
to local nonprofits, Boys & Girls Club, Nashua Y, Police Athletic League, Fright Night.

Special Bd. of Aldermen — 08/06/2019 Page 24

You've got to do Fright Night. Marguerite’s Place, Adult Learning Center, you name it, Nashua Soup Kitchen,
Grow Nashua, so you name a local Nashua non-profit and we’ve given money to it. So | think we’d appreciate
the extension. It would just help us be a full participant of this project.

Alderman Clemons

Thank you. | completely understand that from a commercial lending perspective you have to have that lease in
place in order for a lender to give you that loan. You know a few years ago when | was on the Board we did that
for the Airport Authority and we did that for private citizens who had hangars and different things that they
wanted to do; get loans for that they were unable to so we extended that out for 99 years | think. But | certainly
would support extending a lease and |, you know, like you said everything you have done for the community has
been great. | think the mission there has been achieved and | can’t see needing to really discuss many major
changes to that lease. So as long as we are under similar terms, | think | could support something like that.

Alderman Jette

So forgive me for asking but it’s the only way | am going to find out. Somebody said, unless | misunderstood
that you get like a $650,000.00 profit. Did | hear correctly is that true?

Mr. Hall | wish it was true. If it was we’d give it right back to the community. No, no what | think you remember
is Mayor Donchess and | corrected him, over since 2004 we’ve given out $760,000.00 over that amount of
years, approximately $50,000.00 a year.

Alderman Jette

May | continue? So is Conway, are you guys doing this as a service to the City, whatever you take in it pays off
your expenses, you’ve got the note to service and you guys personally are not making any money.

Mr. Hall No, no no.

Mr. Hall For full disclosure | own an HVAC Company | do work for the City, | do work at Conway Arena, | do
work for the Boys Club so there is a little of that but we don’t, we give everything out to the non-profits, we put
money into a reserve. Two years ago we put new rubber flooring in all the locker rooms. Last year we bought a
new Zamboni to replace the original; that was $100,000.00. This fall we are redoing the rest of the rubber
flooring. So | certainly encourage you to go by and take a look at it.

We take a lot of pride in it but all the money that we make at the end of the year, just like you said, goes to the
non-profits, goes to the mortgage. We put some in the reserve just for these type of expenses that come up.
But none of us make a salary or get paid or anything for our involvement with the arena, it is truly a love for the
City and hockey and figure skating.

Alderman Jette

Well thank you for clarifying that.

Special Bd. of Aldermen — 08/06/2019 Page 25

Alderman Lopez

Maybe some of the more experienced Board Members or the Mayor could tell me but | can’t actually think of
something that the City owns in terms of entertainment value which isn’t typically better managed by somebody
like I’m thinking of Holman Stadium. On the other hand I’m thinking of the Arts & Sciences Building which we
tried to run and didn’t do so great. So | feel like if we have somebody who is leasing it and doing major service
to the community both financially in terms of donating to non-profits, but running it effectively in the way that it is
supposed to run, I’m in favor of supporting them too. If all they are asking is the ability to improve the facility to
the extent that we can save money on electricity for it.

Alderman Dowd

Question for whoever wants to grab it. | am going to assume we will need legislation and if so, has it been
drafted yet and does it need a sponsor and how quickly can we get it in the pipeline, Mr. Mayor?

Mayor Donchess

| think it is simple legislation that could be prepared for the meeting of August 13°".

Mr. Weeks If | may Mayor, just to your question about timeline and thank you so much Mr. Hall and the Board.
Just very briefly economies of scale certainly do count. The 8.8 cent PPA rate is not something that we would
be able to offer and cover our cost or the investor’s cost without the participation of Conway Arena at a 400
kilowatt, so 4 times roughly the size of the individual projects currently in play for the City. So in terms of
timeline we are blessed to have a lot of demand particularly with the sun setting of the tax credit. So with James
and the team are doing a lot of juggling of priorities, we want very much to complete this this year but we are
pushing up toward some major procurements that we need to make of panels and racking etcetera and we
cannot make those major procurements until we have this signed contract.

We understand that there is a process with the Board of Aldermen but we hope very much as we have relayed
to members of the staff here that that can be fully finalized and signed in the month of August so that we can
stay on track for a fall installation.

Alderman Dowd

Can we have the presentation added to the minutes of this meeting so that the people that aren’t here tonight
can have access to it?

Mr. Weeks We would be pleased to share it.
President Wilshire

Thank you so much.

Special Bd. of Aldermen — 08/06/2019 Page 26

Alderman Clemons

So given what Dan just said with the month of August | would assume that we would need a special meeting.

President Wilshire

Because we only have one meeting in August.

Alderman Clemons

So we would need to consider that | guess.

President Wilshire

We will schedule a date.

Alderman Clemons

Sounds good.

President Wilshire

Director Marchant, did you have something to add?

Sarah Marchant, Director Community Development

You do have two meetings in August, don’t you have a second one later this month on the 20th?

President Wilshire

No we only meet once in July and once in August.

Ms. Marchant

So we will be looking to find out which Committees are most likely to be referred to see if we can get those set
up for early September.

President Wilshire

We will work on it expediently.