⚡ 40 MILLBURY RD

MEMORANDUM

TO: Sunland America Corp. Development Team

FROM: Senior BESS Site Evaluation Analyst

DATE: October 26, 2023

SUBJECT: Comprehensive Site Diligence Analysis for 40 Millbury Rd, Oxford, MA (APN: 16_D03)

This report provides a comprehensive due diligence analysis for the potential acquisition and development of a Battery Energy Storage System (BESS) project at the subject property. The analysis identifies several significant challenges related to grid infrastructure, regulatory hurdles, and site characteristics. The initial findings suggest a high-risk profile for this site.

1. Site Access & Topography

Road Access: The property is located at 40 Millbury Road in Oxford, MA. Preliminary review via satellite imagery indicates the parcel may have frontage on Millbury Road, a two-lane, paved local road. However, there is no existing curb cut or improved access point visible. The quality of Millbury Road itself appears sufficient for standard construction traffic.

Equipment Delivery & Topography: The site is currently undeveloped and heavily forested. The topography in this region of Worcester County is characterized by rolling hills, and this parcel appears to have some slope. A formal topographical survey is required to assess grading requirements, which are anticipated to be moderate to significant, increasing site preparation costs. Access for heavy equipment, such as a mobile crane for setting transformers and low-boy trailers for delivering battery containers, is a major concern. A new, sufficiently wide and graded access road would need to be constructed from Millbury Road onto the site, and its feasibility depends on terrain and potential environmental constraints (e.g., wetlands).

Easement Concerns: A critical immediate step is to confirm legal, deeded access. While the parcel appears to front the road, the exact legal access rights must be verified through a title search. If access is limited or requires an easement over neighboring properties, this would add significant complexity, cost, and risk.

2. Environmental Constraints

Flood & Wetlands: The FEMA flood zone and wetlands status are currently marked as Unknown. This represents a major information gap and a significant potential risk. Massachusetts has stringent wetlands regulations under the Massachusetts Wetlands Protection Act. Given the site's undeveloped, forested nature, the presence of jurisdictional wetlands is highly probable. A desktop environmental screening is the immediate next step, likely to be followed by a full wetlands delineation, which could substantially reduce the 12.58-acre parcel's buildable area and impose restrictive setbacks. Any development within a flood zone would require significant elevation and engineering, likely rendering the project uneconomical.

Habitats & Contamination: The site shows no known critical habitats, protected areas, or proximity to superfund sites. This is a positive, as it reduces the risk of endangered species-related development restrictions. The lack of brownfield status means the project is ineligible for the 10% IRA brownfield tax credit adder, which is a disadvantage compared to previously developed sites. The absence of nearby pipelines or gas wells is a safety and risk-reduction benefit.

3. Grid Infrastructure & Interconnection

Proximity to Infrastructure: The nearest substation, NORTH OXFORD, is 1.5 miles away. This is a considerable distance for a distribution-scale project (≤5MW), as a dedicated feeder extension of this length would be prohibitively expensive, likely costing over $1.5 million. The substation's 115 kV maximum voltage indicates it is primarily a transmission/sub-transmission asset, which may have limited distribution-level capacity or require costly station upgrades. A 345kV transmission line is closer (0.9 miles), but interconnecting a small 5MW BESS at this voltage is not technically or financially feasible.

Interconnection Pathway & Cost: The only viable path for this project is to interconnect to a 3-phase distribution feeder running along Millbury Road. The presence, voltage (e.g., 13.8 kV), and available capacity of such a feeder are Requires Verification and represent the single most critical technical hurdle for this site. If no suitable feeder is present, the site is non-viable. The interconnecting utility is also unknown but is likely National Grid. Interconnection in the ISO-NE territory is a lengthy and complex process, with queue times often exceeding 24-36 months for study and approval.

4. Regulatory & Zoning Analysis

Jurisdiction & Zoning: The Authority Having Jurisdiction (AHJ) is the Town of Oxford. The property is zoned R-1 (Residential-1), with a land use designation of "Private Preserve, Open Space-Vacant Land." This zoning is highly unfavorable for a utility-scale energy project.

Permitting Pathway: A BESS is not a permitted use by-right in an R-1 zone. The project would require, at a minimum, a Special Permit from the Planning Board or, more likely, a Use Variance from the Zoning Board of Appeals (ZBA). A Use Variance is extremely difficult to obtain, as it requires proving a unique hardship associated with the land itself. This discretionary process carries immense risk, is subject to public hearings, and faces a high likelihood of significant local opposition, especially from residents in an R-1 district.

Moratorium Risk: Many municipalities in Massachusetts are considering or have enacted moratoriums on BESS development to allow time to create specific bylaws. The lack of a specific BESS bylaw in Oxford creates uncertainty and increases the risk that the town could impose a moratorium during the permitting process. This regulatory uncertainty is a major deterrent.

5. IRA/ITC Incentive Analysis

The site's location provides no additional benefits under the Inflation Reduction Act (IRA) beyond the base Investment Tax Credit (ITC).

• Opportunity Zone: No. (0% adder)
• Energy Community: No. (0% adder)
• Low-Income Community: No. (0% adder)

Cumulative ITC Adder: 0%. The project would only be eligible for the 30% base ITC (assuming prevailing wage and apprenticeship requirements are met). This lack of "stackable" credits makes the project's economics less competitive and provides no cushion to absorb