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TCAAP Energy Integration Resiliency Framework Energy Source Implementation 57 The City, County and JDA should resolve these items prior to commencing with the site development RFP process. While all of the items listed above are important for development, the following items will likely require the most attention. Forming the Business Unless Ramsey County or Arden Hills is the owner of the low-temperature district energy system, an ownership entity should be developed, based upon the system mission. The ownership entity will handle the system operations, maintenance, and billings. The business could be best served by one of the following structures: Municipally Owned, Private Non-Profit, Private For-Profit, or a Hybrid Publically-Owned Infrastructure/Private Non-Profit Company. Each structure has inherent benefits and detriments, which will need to be evaluated as the business structure is determined. The private, non-profit model operational structure is the business structure that was assumed in the financial analysis. This business structure operates under the governance of local stakeholders and customers. This type of business model has several advantages, the most prominent being that the rates would be cost-based, meaning that the rates would cover the cost of operating the system and debt service, without mark-ups for profit or return on investment. Developer Outreach and Education A critical aspect of this system is that each home in the system service area should be connected to the system. This will require developers to install heat pump units in each home, instead of traditional forced air furnaces and air conditioner units. The developers should be properly educated on this opportunity and this direction should be clearly stated in the RFP language, so that the developers can understand and implement the strategy from the onset. Reach Agreement with U.S. Army for use of Existing Building and Treated Groundwater The ownership entity will need to negotiate with the Army for the use of energy from the treated groundwater and the existing building to which the groundwater treatment station is attached. This agreement will, at a minimum, need to provide for access to and operation of the energy transfer station equipment. Ideally, an agreement would include ownership transfer of the building and groundwater pumping system at the termination of the groundwater treatment operations, so that the heat pump loop can continue to meet the heating and cooling needs of the development. System Financing Depending upon the preferred ownership structure, the financing strategy for the system could be very different. If the system is publicly owned, it could be financed through the public institution or in private markets. If a private, non-profit, the system could be 100% debt-financed based upon long-