⚡ 1072 N DELSEA DR

MEMORANDUM

TO: Sunland America Corp. Development Committee
FROM: Senior BESS Site Evaluation Analyst
DATE: October 26, 2023
SUBJECT: Comprehensive Site Diligence Analysis for APN 0801_1902_15_QFARM (1072 N Delsea Dr, Clayton, NJ)

This report provides a comprehensive due diligence analysis for the subject property in Clayton Borough, Gloucester County, New Jersey, for its potential as a distribution-scale Battery Energy Storage System (BESS) project. The analysis covers key development pillars including site characteristics, environmental constraints, grid infrastructure, regulatory hurdles, and financial incentives.

1. Site Access & Topography

The subject property exhibits excellent physical access, a significant advantage for construction and operations. It has direct frontage on North Delsea Drive (New Jersey Route 47), a major state highway. This two-lane road appears well-maintained and is a designated truck route, capable of handling the heavy and oversized loads required for BESS construction, including battery containers, power conversion systems (PCS), and large transformers. Delivery logistics are anticipated to be straightforward, minimizing transportation risks and costs.

Based on aerial imagery and regional geographic data, the topography of the 11.89-acre parcel is presumed to be flat, consistent with the Southern New Jersey coastal plain. This is highly favorable, as it will significantly reduce earthwork and civil engineering costs associated with grading and foundation work. The 10.84 buildable acres provide ample space for a 5 MW / 20 MWh project layout, including necessary equipment pads, access roads, and required setbacks. No access easements appear necessary given the direct highway frontage, though a formal curb cut permit from the NJDOT will be required for a new construction entrance off Route 47. Verification of soil conditions via a geotechnical study will be a required step to confirm suitability for heavy equipment foundations.

2. Environmental Constraints

The environmental profile presents a mix of low risks and critical data gaps that must be addressed immediately. A preliminary review of the FEMA Flood Insurance Rate Maps indicates the property is located in Zone X, an area of minimal flood hazard. This is a significant positive, as it obviates the need for costly flood mitigation measures. The data indicates no critical habitats or protected areas on or immediately adjacent to the site.

However, several key unknowns pose a risk:

• Wetlands: The presence and extent of wetlands are unknown. New Jersey, via the NJ Department of Environmental Protection (NJDEP), has some of the most stringent wetland regulations in the country. The presence of regulated wetlands could sterilize a significant portion of the buildable area and require extensive buffers (up to 150 feet), potentially rendering the project unviable. A desktop screening using NJ-GeoWeb followed by a formal wetland delineation is a critical, immediate next step.
• Brownfield/Superfund Status: The property is not listed as a brownfield, but there is one Superfund site located within two miles. While this proximity does not automatically qualify the site for the 10% IRA brownfield tax credit adder, it necessitates a Phase I Environmental Site Assessment (ESA) to ensure no contamination has migrated to the subject parcel and to definitively determine if any historical use might qualify it as a brownfield.
• Pipeline Proximity: The site is favorably located with no major natural gas transmission pipelines within a three-mile radius, eliminating risks and setback requirements associated with such infrastructure.

3. Grid Infrastructure & Interconnection

The site's primary strength lies in its exceptional proximity to grid infrastructure. The Clayton Substation (69 kV) is located just 0.55 miles away. This short distance is ideal, drastically reducing the potential cost and complexity of the generator lead line. The substation's 69 kV bus is a sub-transmission voltage, but it almost certainly serves distribution feeders at a lower voltage (e.g., 12.47 kV or 13.2 kV).

For a distribution-scale project (≤5MW), the recommended interconnection strategy is to tap into an existing 3-phase overhead distribution feeder originating from the Clayton substation, likely running along Delsea Drive. This approach is the most cost-effective, with an estimated interconnection cost in the $1.5M to $3.5M range, though this is highly dependent on the feeder's available capacity and required utility upgrades. A direct 69 kV interconnection is a theoretical possibility but would be cost-prohibitive, requiring a dedicated substation on-site.

The interconnecting utility is presumed to be Atlantic City Electric (ACE), an Exelon company. The project would be required to enter the PJM Interconnection queue. PJM's queue is notoriously backlogged, and a realistic timeline from application to commercial operation can be 3-5 years. This long and uncertain timeline is a major industry-wide risk that fully applies to this project.