⚡ 3163 HUCKLEBERRY HWY

BESS Site Diligence Analysis - 3163 Huckleberry Hwy, Somerset, PA

To: Sunland America Corp. Investment Committee
From: Senior BESS Site Evaluation Analyst
Date: October 26, 2023
Subject: Comprehensive Site Diligence Analysis for 3163 Huckleberry Hwy, Somerset, PA

This report provides a comprehensive site diligence analysis for the property located at 3163 Huckleberry Hwy, Somerset, PA (APN: S44-014-035-00). The analysis focuses on key factors influencing the feasibility, cost, and timeline of developing a distribution-scale (≤5MW) or utility-scale Battery Energy Storage System (BESS) project. Our goal is to identify critical opportunities, risks, and necessary next steps for Sunland America Corp.

1. Site Access & Topography

• Road Access Quality & Equipment Delivery: The property benefits from Public Road Access, which is a significant advantage as it eliminates the need for acquiring private road easements or negotiating access rights with adjacent landowners. However, the quality of "Huckleberry Hwy" (e.g., paved vs. gravel, width, load-bearing capacity for bridges/culverts) needs immediate verification. For heavy equipment such as transformers, battery containers, and construction machinery, wide, well-maintained roads are crucial. Potential road improvements or reinforcement may be required, especially for the final stretch to the project site.
• Terrain Characteristics: The property is located in Somerset County, PA, which is part of the Appalachian region, characterized by rolling hills and mountainous terrain. Despite this, the data indicates "Buildability: Great" and "Buildable Acres: 45.37" out of 79.12 total acres. This suggests the parcel likely contains significant relatively flat or gently sloping areas suitable for BESS infrastructure. A topographic survey will be essential to confirm these characteristics, identify optimal pad locations, and estimate grading requirements.
• Heavy Equipment Access: Given "Public Road Access" and "Great Buildability," it is highly probable that heavy equipment can access the site. The primary concern will be the final approach from Huckleberry Hwy onto the property itself. Internal site roads will need to be constructed to accommodate oversized loads and heavy machinery. The "POI Onsite" notation is positive, implying the point of interconnection is within the property boundaries, simplifying internal access planning.
• Access Easement Concerns: With public road access, external access easements are unlikely to be a concern. However, if the 45.37 buildable acres are not contiguous or require crossing other portions of the 79.12-acre parcel, internal access easements or careful site layout will be necessary to ensure unencumbered access to all BESS components.

2. Environmental Constraints

• FEMA Flood Zone Designation: The FEMA Flood Zone is Unknown. This is a critical data gap. Immediate verification through FEMA's National Flood Hazard Layer (NFHL) is required. If any portion of the buildable area falls within a 100-year (Zone AE) or 500-year (Zone X-shaded) flood zone, it would necessitate elevated equipment pads, floodproofing measures, and potentially more stringent permitting requirements, significantly impacting project cost and schedule.
• Wetlands Presence & Setback Requirements: The presence of Wetlands is Unknown. This is another critical gap. A Phase I Environmental Site Assessment (ESA) followed by a wetland delineation study (if warranted) is essential. Wetlands can trigger federal (Army Corps of Engineers Section 404) and state (PA Department of Environmental Protection) permitting, requiring avoidance, minimization, or mitigation, which can be costly and time-consuming. Typical setbacks from wetlands can range from 50 to 100 feet or more, potentially reducing the usable buildable area.
• Critical Habitat / Endangered Species Risk: The data indicates None for Critical Habitat. This is a positive finding, reducing the risk of project delays or design modifications due to protected species concerns. However, a desktop review of state and federal endangered species databases (e.g., USFWS IPaC, PA Natural Diversity Inventory) is still recommended as part of the Phase I ESA.
• Brownfield/Superfund Status: The data states None within ~2 miles. This means the site is not a designated brownfield or superfund site. While this avoids the risks and costs associated with environmental remediation, it also means the project would not qualify for the 10% IRA Brownfield ITC adder. This is a neutral to slightly negative point for incentives but a strong positive for project risk management.
• Chesapeake Bay Critical Area: The data confirms N/A (non-MD), meaning this constraint is not applicable to a site in Pennsylvania.
• Pipeline Proximity Safety Considerations: The data indicates None within ~3 miles for Pipeline Proximity and None within ~2 miles for Gas Wells Nearby. This is an excellent finding, as it eliminates major safety concerns, potential setback requirements, and complex permitting often associated with proximity to high-pressure gas pipelines or active/abandoned wells.

3. Grid Infrastructure & Interconnection

• Nearest Substation: The Nearest Substation: - (Distance: -, Max Voltage: - kV) is a critical unknown. Without this information, a fundamental assessment of interconnection feasibility is severely hampered. This is the single most important data gap for grid access.
• Nearest Transmission Line: The data states None within ~3 miles for the Nearest Transmission Line. This is a significant concern for utility-scale projects. If no transmission line is within 3 miles, and the substation distance is also unknown, it strongly suggests that a transmission-level interconnection would be extremely costly due to extensive line extension requirements.
• Recommended Interconnection Voltage: Given the lack of nearby transmission infrastructure and the typical scale of Sunland America's projects (≤5MW), a distribution-level interconnection is the most likely and economically viable pathway. However, this recommendation is highly speculative without knowing the nearest substation's distance, voltage, and available capacity.
• Interconnection Cost Range & Timeline: Due to the significant unknowns regarding substation distance, voltage, and available capacity, it is impossible to provide an accurate estimate. For a distribution interconnection, costs can range from $500,000 to $2,000,000+ depending on feeder upgrades, new line construction, and substation modifications. The timeline for Penelec (FirstEnergy, operating in PJM) interconnection studies (Feasibility, System Impact, Facilities) can be lengthy, typically ranging from 18 to 36 months or more to achieve an Interconnection Agreement, with construction adding another 12-24 months.
• Utility-Specific IX Process & Typical Queue Times: The interconnecting utility is Penelec, which operates within the PJM Interconnection RTO. PJM's interconnection queue is known for its complexity and long study timelines, especially for projects requiring network upgrades. Sunland America should anticipate a multi-year process.
• Likely Feeder Configuration: Requires Verification. Without substation details, it's impossible to determine the likely feeder configuration (e.g., radial, loop, network) or its existing loading and capacity. This will be a key output of the initial interconnection study.

4. Regulatory & Zoning Analysis

• Authority Having Jurisdiction (AHJ) & Type: The Municipality / AHJ is Found (unnamed). This needs immediate identification. The AHJ will likely be a specific Township or Borough within Somerset County, PA, in addition to Somerset County itself. This will be a local municipal government, responsible for zoning, building permits, and local land use approvals.
• Current Zoning for BESS Compatibility: The current zoning is Agricultural/Rural - Rural Improved / Non-Residential (Code: -). "Agricultural/Rural" zoning is generally challenging for industrial-scale BESS projects. While "Rural Improved / Non-Residential" offers some flexibility, BESS facilities are often not explicitly listed as "by-right" uses in such districts. This will likely require a discretionary approval process.
• Recommended Permitting Pathway: Given the Agricultural/Rural zoning, a Conditional Use Permit (CUP) or Special Exception is the most probable permitting pathway. This involves a public hearing process, requiring detailed project plans, environmental impact assessments, and addressing community concerns. A "by-right" approval is highly unlikely. A variance would only be pursued if the project cannot meet specific zoning requirements and a CUP/SUP is denied.
• Known Setback Requirements: Unknown. Specific setback requirements for BESS facilities (from property lines, residential structures, public roads) will need to be thoroughly investigated within the identified municipal zoning ordinance and Somerset County regulations. These can significantly impact the usable area on the 45.37 buildable acres.
• State/County Regulations: Pennsylvania does not have a statewide BESS siting law, leaving most regulatory authority to local municipalities. Somerset County may have some overlay regulations, but the specific township/borough ordinance will be paramount.
• Moratorium or Restriction Risks: Unknown. In rural areas, there is a risk of local opposition leading to temporary moratoriums or restrictive ordinances if the municipality has not previously dealt with BESS projects. Early engagement with the AHJ and community is crucial to mitigate this risk.

5. IRA/ITC Incentive Analysis

• Opportunity Zone Eligibility: The property is Not in an Opportunity Zone. Therefore, the 10% ITC adder for Opportunity Zones is not applicable.
• Energy Community Status