⚡ 91 FREDETTE ST

MEMORANDUM

TO: Sunland America Corp. Development Committee
FROM: Senior BESS Site Evaluation Analyst
DATE: October 26, 2023
SUBJECT: Comprehensive Site Diligence Analysis for 91 Fredette St, Gardner, MA (APN: M22-11-7)

This report provides a comprehensive due diligence analysis for the subject property, a 2.12-acre parcel in Gardner, Worcester County, Massachusetts, for its potential as a distribution-scale Battery Energy Storage System (BESS) project. The analysis concludes with a suitability score and recommended next steps.

1. Site Access & Topography

Road Access & Feasibility: The property is located on Fredette Street, which appears to be a paved, two-lane industrial road based on aerial imagery. It has direct access to West Street, which connects to major state routes like MA-2 and MA-140, providing a clear and viable path for heavy truck traffic from major transportation corridors. The quality of the local roads appears sufficient for the delivery of heavy equipment.

Terrain & Equipment Access: The site is situated in an established industrial area and appears to be relatively flat and graded, consistent with its current land use designation as a "Truck Terminal." This topography is highly advantageous, minimizing the need for extensive civil work and site grading, which reduces construction costs. Access for oversized and overweight loads, such as a main power transformer (MPT) and prefabricated battery enclosures (containers), appears feasible. However, a formal route survey is required to confirm bridge weight limits, turning radii, and overhead line clearances from the highway to the site entrance.

Easement Concerns: Requires Verification. A title search is necessary to identify any existing access, utility, or drainage easements that could encumber the property and restrict the developable area. Given the industrial nature of the area, it is likely that utility easements exist along the road frontage.

2. Environmental Constraints

FEMA Flood Zone: Requires Verification. The FEMA flood zone designation is currently unknown. This is a critical data gap and a potential fatal flaw. Any designation within a 100-year floodplain (Zone A, AE) would likely render the site undevelopable for critical infrastructure like a BESS or require significant and costly mitigation, such as elevating all equipment above the Base Flood Elevation (BFE).

Wetlands: Requires Verification. The presence of state or federally protected wetlands is unknown. Massachusetts has stringent wetland protection regulations (Massachusetts Wetlands Protection Act). A formal wetlands delineation will be required to determine if any jurisdictional areas exist on-site. The presence of wetlands could impose significant setbacks (typically 50-100 feet), reducing the buildable acreage and potentially impacting the project's viability on a small 2.12-acre parcel.

Critical Habitat / Endangered Species: The data indicates no critical habitat or protected areas on or immediately adjacent to the site. This significantly de-risks the project from a wildlife and ecological permitting perspective.

Brownfield/Superfund Status: The property itself is not listed as a brownfield, but the presence of 13 known contaminated sites within a two-mile radius is a notable risk. This proximity necessitates a Phase I Environmental Site Assessment (ESA) to determine the likelihood of on-site contamination from historical or nearby activities. While this presents a risk of required remediation, it does not appear to qualify the site for the 10% IRA brownfield tax credit adder, as the census tract is not designated as an Energy Community.

Pipeline Proximity: No major gas transmission pipelines are located near the site, eliminating risks associated with pipeline setbacks and potential explosion hazards.

3. Grid Infrastructure & Interconnection

Substation & Transmission Proximity: The site's primary strength is its grid proximity. It is located just 1.1 miles from a substation designated "UNKNOWN133570" with a maximum voltage of 69 kV. The absence of high-voltage transmission lines within three miles confirms this is purely a distribution-level interconnection opportunity, which aligns perfectly with Sunland's focus on ≤5MW projects.

Interconnection Recommendation & Feasibility: The most likely Point of Interconnection (POI) would be on an existing 3-phase distribution feeder originating from the nearby substation. The likely interconnection voltage would be in the 13.2 kV to 13.8 kV class, which is standard for this type of substation. The 1.1-mile distance is manageable, though not ideal. A line extension of this length will be required.

Cost & Timeline Estimate: Interconnection costs for a 1.1-mile distribution line extension can vary significantly. A preliminary budget should assume a range of $1,000,000 - $2,500,000, depending on whether the line can be run overhead on existing poles or requires new poles and/or underground segments. The interconnecting utility is almost certainly National Grid. Their interconnection process in Massachusetts (under the Massachusetts Department of Public Utilities rules) can be lengthy, with queue times often exceeding 18-24 months from application to commercial operation. An immediate pre-application is critical to enter the queue.

4. Regulatory & Zoning Analysis

Authority Having Jurisdiction (AHJ): The City of Gardner, Massachusetts.

Zoning Compatibility: The parcel is zoned IND2 (Heavy Industrial). This is highly favorable for BESS development. Industrial zones are generally the most permissive for utility and energy infrastructure. BESS is often considered a compatible use, analogous to a public utility or electrical substation.

Permitting Pathway: The most likely permitting pathway will be a Special Permit from the Gardner Planning Board or City Council. It is unlikely to be a by-right use but should not require a more arduous variance. Our initial step must be to review the City of Gardner's Zoning Ordinance to see if "Battery Energy Storage" is explicitly defined. If not, we will need to work with city staff to classify the use. We must also verify specific setback requirements, noise ordinances (for HVAC systems), and aesthetic/screening requirements.

State Regulations & Risks: Massachusetts has a supportive, albeit complex, regulatory environment for energy storage, with programs like the Clean Peak Energy Standard that can provide additional revenue streams. There are no known moratoriums on BESS in Gardner, but this must be confirmed directly with the AHJ.

5. IRA/ITC Incentive Analysis

Incentive Qualification: This is the site's most significant weakness. Based on the data provided, the project census tract does not qualify for any of the key Investment Tax Credit (ITC) adders under the Inflation Reduction Act (IRA).

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

Potential Cumulative ITC: The project will likely only be eligible for the base 30% ITC. The inability to stack adders to reach 40%, 50%, or higher will put this project at a significant economic disadvantage compared to competing sites and will require strong revenue assumptions from market participation to achieve target returns.

6. BESS Score & Rationale