DATE: March 10, 2020
SUBJECT:
Title
RESOLUTION AUTHORIZING THE EXECUTIVE DIRECTOR TO EXECUTE A MEMORANDUM OF UNDERSTANDING WITH DOLE FRESH FRUIT COMPANY, REGARDING LOW CARBON FUEL STANDARD (LCFS) CREDITS FROM THE SHORE POWER PLUG LOCATED AT THE TENTH AVENUE MARINE TERMINAL FOR CREDITS GENERATED FROM JANUARY 1, 2020 THROUGH MARCH 31, 2020.
Body
EXECUTIVE SUMMARY:
The State of California's Low Carbon Fuel Standard (LCFS) expanded its optional participant definition in 2019 to include some operations by the District and its tenants. Specifically, using grid power instead of diesel fuel to energize cruise and cargo vessels when berthed can create credits that can be sold in the LCFS market. The creation, registration, optimization and sale of the credits has resulted in a revenue stream for the District for shorepower operations at the Tenth Avenue Marine Terminal (TAMT) and the Cruise Ship Terminals.
Since the Port owns the shorepower infrastructure at TAMT but Dole Fresh Fruit (Dole) is the direct utility customer and account holder for shorepower at TAMT and Dole's operation is currently the only shorepower use at TAMT, the LCFS credits generated at TAMT stem from a combination of Dole and the District. Dole and the District are currently negotiating a long-term MOU to determine, among other things, the appropriate split in revenues generated from the LCSF credits. However, so as not to forego the current opportunity to monetize the credits during negotiations, the District and Dole have been entering into quarterly MOU's with a 50/50 revenue split beginning in Q2 of 2019. Since the Q1 2020 MOU will potentially bring Dole's cumulative share of the proceeds beyond $175,000, Board approval of the MOU is required.
RECOMMENDATION:
Recommendation
Approve resolution authorizing the Executive Director to execute a Memorandum of Understanding with Dole Fresh Fruit Company, regarding Low Carbon Fuel Standard (LCFS) credits from the shorepower plug located ...
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