B-5

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GVS&DD Biomethane Agreement Streamlined Review Process

September 25, 2013

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Contents Regulatory Background

Regulatory History

Approvals Sought

Project Description

Project Overview

Interconnection Facilities and Capital Costs

Agreement Compliant with Biomethane Program

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PART 1: Regulatory History and Approvals Sought

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Relevant Regulatory History 2012 2013

Q2 Q3 Q4 Q1 Q2 Q3 Q4

March 2013:

Order G-45-13 Biomethane Pilot Cap Increased December 2012:

AES Report

December 2012

Filed PIR & 2012 Biomethane Application

February 2013

Order G-18-13 CPCN required for GVS&DD

August 2013:

FEI Applies for Acceptance of GVS&DD Agreement

May 2013

Decision G-70-13 3 Biomethane Projects Approved

August 2013

BCUC Order G-126-13 Exempting Upgrading from CPCN

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Approvals 2010 Biomethane Decision Order G-194-10 • Approval of Biomethane Supply Agreement between FEI and

GVS&DD pursuant to Section 71 of the UCA • Capital Expenditures related to Interconnection Equipment for the

Project pursuant to Section 44.2 of the UCA

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Project Description

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Purchase complies with RNG Program

GVS&DD responsible for

upgrading raw biogas

FEI purchases

Biomethane

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GVS&DD Required Interconnect

Location: 13500 Gilbert Rd, Delta, BC Connecting Pipe: 300 m of 114mm PE Pipe FEI Station: Gas monitoring, Pressure, odorizing, flow measure, safety, control Total Cost: $0.739M

New FEI Station

WWTP

Tie-in Location

Interconnect

Piping

Existing DP main

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Key Elements of Station • Inlet Valve • Gas Monitoring [Gas Chromatograph, H2S Monitor, O2 Monitor] • Pressure Regulation • Odorizing • Flow Measurement • Communication Modular and moveable (skid-mounted) Designed to operate automatically • Shut off if gas does not meet specification Interconnecting Pipe • Matches FEI standard

FEI will use standard Interconnection

Salmon Arm

Fraser Valley Biogas

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Capital Costs of Interconnect

• Piping costs are estimates with contingencies included (site visit done) • Station costs include contingencies • FEI considers this a conservative estimate at +5% / -20%

Item

Description Distribution Pressure, PE Pipe,

residential area, piping on GVS&DD Property

Station Capital Cost Estimate $639,000

Pipe Capital Cost Estimate $100,000

Connecting Pipe $300/m

Est. Cost per GJ-station and Pipe (based on expected flow, 20 year) $0.92/GJ

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Contract Highlights Item Amount Comment

Volume (Max) 40,000 GJ/Yr Maximum Biomethane Volume

Excess Gas up to 60,000 GJ/Yr Maximum Volume purchased @ Sumas Monthly Index Rate

Total Maximum Injected 100,000 GJ/Yr Estimated FEI system capacity

Contract Term 10 Years

Injection Date Q4 2015 Approval + 18 months Long lead item is upgrader

FEI Capital $0.739M Capital Cost of Interconnect

Price $13.40/GJ Starting Price

$10.68/GJ Minimum Biomethane Price

Price inflation 1.5% annual Price capped at current BCUC approved maximum of $15.28

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Purchase of Excess Gas

• All Biomethane produced up to 40,000 GJ per calendar year purchased at Biomethane Rate

• Remaining Gas Purchased at Sumas Monthly Index

• Not part of biomethane supply pool

• GVS&DD retains any GHG benefits on excess gas

• New supply point on FEI system

• Will be tracked separately

• FEI purchases Max 60,000 GJ per year excess gas

• FEI purchase a total of ~0.275 TJ/day*

• No material impact to MCRA (~150 TJ/day)

* 100,000 GJ / 365 days – includes total amount of gas purchased (biomethane + excess gas)

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Approved Pilot Program Criteria

• All contracts are at least 10 years in Length

• FEI has retained control over injection location

• The selected upgrader is sufficiently proven

• FEI reserves the right to refuse gas

• The partner is a municipality, regional district, or other public authority, or is a private party with a track record in dealings with FEI or that posts security to reduce the risk of stranding

• All the contracts are below the approved Maximum of $15.28*

• Within approved annual maximum purchase of biomethane (Supply cap)

* Supercedes criteria that the projected supply meets the proposed economic test that the maximum price for delivered biomethane recalculated from time to time based on the updates to the BC Hydro RIB Tier 2 rate

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Projects included in Revised Supply Cap

• Commission Orders G-29-13 and G-45-13 increased supply cap to 530,000 GJ annually from 250,000 GJ annually

• GVS&DD project specifically referenced in Commission Orders

Project Name Contract Maximum

(GJ/Year)

Fraser Valley Biogas 91,250

Salmon Arm Landfill 40,000

Kelowna Landfill 118,000

Earth Renu 100,000

GVS&DD 40,000

Dicklands 70,000

Seabreeze 70,000

Total 529,250

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Project is Compliant with FEI Criteria Criteria

Contract Contains

Clause that Meets

Criteria

Comments

Contract Duration at least 10 Years YES

Retained final control over injection location YES FEI owns interconnect

Upgrader Proven YES GVS&DD will impose criteria in its procurement process to select an upgrader that is sufficiently proven

Right to Refuse Gas YES Based on quality and volume

The partner is a municipality, regional district or other public authority, or is a private party with a track record in dealings with FEI or that posts security to reduce the risk of stranding

YES

The GVS&DD forms part of Metro Vancouver and is a government owned and operated utility, funded by taxpayers. No security required.

Price below $15.28 YES Limits price to the approved Max

Below Supply Cap YES

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Conclusion

• The GVS&DD project is part of the Biomethane Pilot Program

• FEI has negotiated the GVS&DD Agreement to comply with the approved Biomethane Pilot Program criteria.

• The Interconnection costs are necessary for the GVS&DD project.

• FEI believes that the agreement and interconnection facilities are in the public interest.