Agenda Item # Page # CHAIR AND MEMBERS BOARD OF CONTROL MEETING ON WEDNESDAY, AUGUST 26,2009. PAT McNALLY. P.ENG. ii

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1 Ii r--... TO: CHAIR AND MEMBERS BOARD OF CONTROL MEETING ON WEDNESDAY, AUGUST 26,2009 I I PAT McNALLY. P.ENG. ii rrwm; GENERAL MANAGER OF ENVIRONMENTAL AND ENGINEERING SERVICES AND CITY ENGINEER SUBJECT AMENDMENT TO EXISTING AGREEMENT WITH LONDON DISTRICT ENERGY I RECOMMENDATION That, on the recommendation of the General Manager of Environmental and Engineering Services and City Engineer, the attached proposed by-law (Appendix A), BE INTRODUCED at the Council meeting of August 31, 2009 to amend By-law P.U II BACKGROUND II Purpose: This report proposes an amendment to the service area of London District Energy to allow them to provide steam to the St. Joseph s Hospital. Discussion: A district energy company has existed in London since 1880 providing steam and more recently chilled water to a number of businesses. This was one of the first district energy plants in Canada and today numerous City s are developing these plants based on their high efficiencies. The company has changed ownership and names several times during that period but maintains a municipal franchise to deliver steam and chilled water within a service area bounded by Oxford Street at the north end. London District Energy has entered into an agreement to provide steam to St.Joseph s Hospital to replace the hospitals existing heat generation plant on Wellington Street. The provision of district energy benefits the hospital, and therefore the City, by providing reliability, reduced capital and operating costs, increased energy efficiency, and improved air quality. The expansion of the steam distribution system also injects millions of dollars into London through the construction of the pipe and associated equipment. Attached in Appendix B is a letter from London Health Sciences supporting the proposed project and endorsing its numerous benefits. The proposed amending by-law extends the service area along the Colborne Street road allowance from Oxford Street East to Grosvenor Street, and along Grosvenor Street from Colborne Street to Wellington Street, and north on Wellington Street into St.Jospeh s. There has been considerable discussion to minimize the congestion and conflict with respect to other demands on the right of &ay. Conclusions: Amending the service area of the London District Energy franchise by-law will allow them to service St.Joseph s Hospital. There are no additional operating costs in the Environmental and Engineering Services budget in 2010 and subsequent years associated with the approval of this recommendation. 11 SUBMITTED BY: [ RECOMMENDED BY: I, I 1,.!I CONSTRUCTION ADMINISTRATION PAT McNALLY, P.Eng. GENERAL MANAGER ENVIRONMENTAL AND ENGINEERING SERVICES AND CITY ENGINEER

2 Agenda Item # d Page # APPENDIX A - Amending By-law Bill No. By-law No. A By-law to amend By-law No. P.U , being "A By-law to authorize Cities Heating Company Limited, for a period of 30 years, to extend, lay and maintain pipes for conducting steam to supply heat on certain streets in the City of London within an area generally bounded by Oxford Street, Adelaide Street, the south branch of the Thames, Grand Avenue, Elmwood Avenue and Wharncliffe Road". WHEREAS section 5(3) of the Municipal Act, 2001 S.O. 2001, c.25, as amended, provides that a municipal power shall be exercised by by-law; AND WHEREAS the Municipal Council of The Corporation of the City of London enacted By-law No. P.U , being "A By-law to authorize Cities Heating Company Limited, for a period of 30 years, to extend, lay and maintain pipes for conducting steam to supply heat on certain streets in the City of London within an area generally bounded by Oxford Street, Adelaide Street, the south branch of the Thames, Grand Avenue, Elmwood Avenue and Wharncliffe Road on the 15" day of February, 1988, (the "Cities Heating Steam franchise By-law"); AND WHEREAS the Cities Heating Steam Franchise By-law was amended by By-law No. P.U.- 475(a)33 passed on the 6" day of February, 1995; AND WHEREAS Fort Chicago District Energy Ltd. (operating as London District Energy) (the "Franchisee") is the successor of Trigen-London District Energy Corporation which was the successor of Cities Heating Company Limited, the franchisee under the Cities Heating Steam franchise By-law, being By-law No. P.U.47581; AND WHEREAS it is deemed expedient to amend the Cities Heating Steam franchise By-law to expand the area within which Franchisee may operate; NOW THEREFORE the Municipal Council of The Corporation of the City of London enacts as follows: 1. The short title "Cities Heating Steam Franchise By-law" of By-law No. P.U entitled "A By-law to authorize Cities Heating Company Limited, for a period of 30 years, to extend, lay and maintain pipes for conducting steam to supply heat on certain streets in the City of London within an area generally bounded by Oxford Street, Adelaide Street, the south branch of the Thames, Grand Avenue, Elmwood Avenue and Wharncliffe Road" which was renamed the " Trigen-London District Energy Franchise By-law", is hereby repealed and "London District Energy Franchise By-law" is substituted therefore. 2. The Cities Heating Steam Franchise By-law by-law is further amended by substituting the name "London District Energy" for the name "Trigen-London District Energy Corporation" wherever the latter name appears in the By-law. 3. The Cities Heating Steam franchise By-law is further amended by deleting Schedule "A" attached thereto and substituting the Schedule 'A" attached to this By-law. 4. This By-law shall not become effective until LDE enters into an agreement which would legally bind LDE to perform, observe and comply with all the obligations, provisions, terms and conditions contained in the Cities Heating Steam franchise By-law, as amended. PASSED in Open Council,2009 Anne Marie DeCicco-Best Mayor First reading - Second reading - Third reading - Linda Rowe Acting City Clerk

3 Appendix A - Amending description of service area SCHEDULE A FIRSTLY In the City of London in the County of Middlesex in the Province of Ontario, being those streets and portions of streets situate, lying and being within the limits described as follows: COMMENCING at the intersection of the westerly limit of Wharncliffe Road with the northerly limit of Oxford Street; THENCE easterly along the northerly limit of Oxford Street to the high-water mark on the westerly bank of the north branch of the Thames River; THENCE easterly in a straight line to the intersection of the high-water mark on the easterly bank of the north branch of the Thames River with the northerly limit of Oxford Street; THENCE easterly along the northerly limit of Oxford Street to the easterly limit of Adelaide Street; THENCE southerly along the easterly limit of Adelaide Street to the high-water mark on the northerly bank of the south branch of the Thames River; THENCE westerly along the last-mentioned high-water mark to the intersection thereof with the production easterly of the northerly limit of Grand Avenue; THENCE westerly along the said production and along the northerly limit of Grand Avenue to the westerly limit of Ridout Street South; THENCE northerly along the westerly limit of Ridout Street South to the southerly limit of Elmwood Avenue; THENCE westerly along the southerly limit of Elmwood Avenue and its production westerly to the westerly limit of Wortley Road; THENCE northerly along the westerly limit of Wortley Road to the southerly limit of Elmwood Avenue west of Wortley Road; THENCE westerly along the last-mentioned southerly limit of Elmwood Avenue to the westerly limit of Wharncliffe Road South; THENCE northerly along the westerly limit of Wharncliffe Road South and Wharncliffe Road North to the point of commencement. SECONDLY In the City of London, in the County of Middlesex, in the Province of Ontario and being comprised of the following road allowances north of Oxford Street East, namely, Colborne Street from the northerly limit of Oxford Street East to the northerly limit of Grosvenor Street; Grosvenor Street from the easterly limit of Colborne Street to the westerly limit of Wellington Street; and Wellington Street from the southerly limit of Grosvenor Street to southerly limit of Cheapside Street; and only for the purpose of conducting steam to supply heat and chilled water to supply cooling to St. Joseph s Hospital.

4 1 Appendix A - Draft agreement to amending service area THE AGREEMENT made in triplicate this day of August, 2009 BETWEEN: THE CORPORATION OF THE CITY OF LONDON (hereinafter called the City ) OF THE FIRST PART -AND- FORT CHICAGO DISTERICT ENERGY LTD. (operating as LONDON DISTRICT ENERGY) (hereinafter called the LDE) OF THE SECOND PART AND WHEREAS on the 15 day of February, 1988 the City enacted By-law No. P.U , being A By-law to authorize Cities Heating Company Limited, for a period of 30 years, to extend, lay and maintain pipes for conducting steam to supply heat on certain streets in the City of London within an area generally bounded by Oxford Street, Adelaide Street, the south branch of the Thames, Grand Avenue, Elmwood Avenue and Wharncliffe Road, (the Cities Heating Steam Franchise By-law %. AND WHEREAS the Cities Heating Steam Franchise By-law was amended by By-law No. P.U.- 475(a)33 passed on the 6 day of February, 1995; AND WHEREAS Fort Chicago District Energy Ltd. (operating as London District Energy) is the successor of Trigen-London District Energy Corporation which was the successor of Cities Heating Company Limited, the flawhisee under the Cities Heating Steam Franchise By-law, being By-law No. P.U ; AND WHEREAS LDE has requested that the City amend the Cities Heating Steam Franchise By-law to expand the area within which Franchisee may operate; AND WHEREAS by the terms of the Cities Heating Steam Franchise By-law, as amended (a true copy of the by-law as amended is annexed hereto and declared to form part of this agreement) the amended by-law was not to become effective until LDE entered into an agreement which would legally bind LDE to perform, observe and comply with all the obligations, provisions, terms and conditions contained in the bay-law as amended; NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the mutual covenants contained herein, the parties covenant and agree as follows: 1. The City grants to LDE the rights, liberties and privileges contained in the by-law as amended. 2. LDE covenants and agrees to perform, observe and comply with all the obligations, provisions, terms and conditions contained in the by-law as amended. 3. The rights granted to LDE by the by-law as amended and this agreement shall terminate on the 15 day of February, unless earlier terminated under the terms and conditions of the by-law as amended. 4. This Agreement shall enure to and be binding on the parties hereto and there respective successors and assigns.

5 Appendix A - Draft agreement to amending service area IN WITNESS WHEREOF, the parties hereto have entered into this Agreement as evidenced by the signatures of their duly authorized representatives. THE CORPORATION OF THE CITY OF LONDON Anne Marie DeCicco-Best, Mayor Linda Rowe, Acting City Clerk FORT CHICAGO DISTRICT ENERGY LTD. (Operating as London District Energy) IiWe have the authority to bind the Corporation

6 APPENDIX 6 - Letter from St.Joseph s Facilities Management St. Joseph s Health Care, London and London Health Sciences Centre 800 Commissioners Rd. E., PO Box 5010 London, Ontario, Canada N6A 5W9 Tel: , Ext Fax: August 12,2009 Mr. Pat McNally General Manager and City Engineer Environmental and Engineering Services City of London 300 Dufferin Avenue P.O. Box SO35 London. ON N6A 4L9 Dear Pat, Re: London District Energy Supply Project On behalf of St. Joseph s Health Care, London (St. Joseph s), I would like to confm our support for the Steam Supply Project that London District Energy (LDE) is currently undertaking with St. Joseph s - London. We have been working with LDE over the past two years to develop a steam supply solution for our Grosvenor Street facility that will provide significant benefit to both St. Joseph s and the community. The specific benefits to St. Joseph s and our community include: 1. Project will provide long term provision of steam to sustain our health care facility at the benchmark cost. 2. Central plant operates at higher efficiency than a single plant reducing our environment impact and footprint for care. 3. Project lifecycle costs ensure capital costs are retained for much needed other health care equipment. 4. Project will provide employment stimulus in this critical fiscal quarter. 5. Work must proceed immediately for weather impact and to gain advantage during this heating season and fiscal year. We believe this project also offers a benefit to the local community through reduced net C02 air emissions and the overall reduced impact of a powerhouse located in a residential area....2/

7 APPENDIX B - Letter from!%.joseph s Mr. Pat McNally August 12,2009 Page 2 We understand that this project requires City Council to approve an amendment to LDE s current service area to permit access to our site and we fully support this change. Please feel free to contact me if you have any questions or require further information. Yours sincerely, David. Crockett, Integrated Vice-president Facilities Management Copy: Cliff Nordal, President and Chief Executive Officer Bruno Labate, Director, Facilities Engineering Bob Hutton, Coordinator, Facilities Engineering Paul Eastman, W Eastern Canada Power Development, Fort Chicago Energy Partners LP