1. GLENARM POWER PLANT REPOWERING PROJECT WORKSHOP
Pasadena City Council
February 4, 2013
Item 13

2. Glenarm Repowering Project
Build a new combined cycle electric generation unit (68 MW net, 71 MW gross)
Decommission existing B3 electric generation unit (65 MW net, 71 MW gross)
Close State Street cul-de-sac off of Fair Oaks Avenue
Construct control room, instrument shop and offices
Modify existing Pump Building as Maintenance shop

3. Aerial View of Power PlantB3
Gold Line
New Plant
Glenarm Bldg.
Pump Bldg.
State
St.

4. City’s Electrical System Must Stay Reliable
Why Repower ?
City’s Electrical System Must Stay Reliable
Need dependable local generation to back up single energy import location
B3 can’t be depended on for too long …47 years old, spare parts problems
Other alternatives (i.e. another import connection) not feasible
Reduced operations cost
New efficient unit is necessary to reduce dependence on coal
Flexible generation with quick start enables wind and solar power integration
Approximately same cost over 20 years to maintain B3 vs. new unit
The City Council approved 2009 Energy IRP on 3/16/2009
Replace existing B3 unit with equivalent size combined cycle unit by 2015

5. Project Phases and Timeline
Description Consultants
Selection of technology, configuration, Power Engineers preliminary engineering, specifications, etc.
CEQA/EIR PCR Hearing by Planning Commission … 3/13/ City Council consideration … 4/8/13
Air permits for General Electric and Rolls Royce Worley Parsons Application submitted …6/12; permit expected 5/13
Environmental & geotechnical site assessment Hydrolouge, Inc.
Others for chemical risk management, noise study, asbestos/lead assessment, etc.

6. Project Phases and Timeline
Bid Specifications for major equipment i.e. gas Issued 6/2012 turbine, once through steam generator, steam Contract by 7/2013 turbine and generator (Power Island) $ 45million approx.
Bid specification for final design, rest of the Contract by 2/2014 equipment and construction (Balance of Plant) $ 51million approx.
Design and construction of control room, etc. Contract by 2/2014
Request for proposal for Project Manager and Contract by 9/2013 Construction Manager
These contracts would need the City Council approval 6

7. Visual Simulations
Looking West From Broadway Plant (Existing)

8. Visual Simulations (Cont.)
Looking West From Broadway Plant…General Electric LM6000 Option

9. Visual Simulations (Cont.)
Looking West From Broadway Plant (Rolls Royce Trent Option)

10. CEQA / EIR- Major Focus Areas
Significantly high greenhouse gas emissions
CEQA compares emissions from new unit operating entire year at full capacity with B3’s actual recent operation i.e. 4% of full capacity
On MWh basis new unit emits ≈30% less
Exemption for height of structures…125 ft. stack
Cultural Resources – Historical resources (Glenarm Building)
Land Use and Planning – Consistency with South Fair Oaks Specific Plan
Noise – Noise Element of General Plan & Noise Ordinance
Project Labor Agreement…. Discussion with CURE underway, emphasis on local hiring and apprenticeship
Substantial comments received on draft EIR

11. Project Management and Oversight
PWP – GM
PWP – AGM OFFICE POWER SUPPLY
POWER PLANT SUPERINTENDENT
REPOWERING PM
TBD
POWER PLANT ENGINEERING
OWNER’S ENGR.
POWER
OTHER PWP DEPT.
OTHER AGENCIES
CONST. MGR.
TBD
BOP/construction CONTRACTOR
TBD
Power Island CONTRACTOR
TBD
Note : Project Manager and Construction Manager may be from the same firm and/or hired under the same contract. Staff to determine best value arrangement for the project following review of proposals for PM/CM services. 11

12. Potential Financing Alternatives
Funding Sources
Power Fund
Bond Proceeds
100% Revenue Bonds $0
$115 million
15% Equity Financing
$17 million
$98 million
Financing Impacts*
100% Financing
85% Financing
Annual Debt Service
$8 million
$7 million
Impact per kilowatt hour (kWh)
$0.0071
$0.0063
Monthly bill impact (500 kWh)
$3.55
$3.15
Sources of Equity Financing:
$15 million to $20 million from Power Fund (working capital)
*All impacts estimated, actual debt service and kWh impact may vary

13. Next Steps and Issues Next Steps Major Issues EIR approval
Air Permit (contingent upon EIR approval)
Financing (Reimbursement resolution for City Council approval on 2/25/2013)
Contracts for major equipment, construction and Project/Construction Managers
Construction and Commissioning
Training for Power Plant staff
Major Issues
Air permit conditions and fee increase
EIR
Project Labor Agreement
Future plan for Broadway site and Glenarm building
Future plan for Gas Turbines 1 and 2
Some elements of project and milestones continue to change due to regulatory and market information

14. BACK UP SLIDES TO FOLLOW

15. Another View of Power Plant15

16. Primary Project Responsibilities
Repowering Project Manager
Overall project responsibility
Reports to PWP AGM
Responsible for high-level decision making and integration and execution of project controls
Full time role, Attends PWP and City management meetings, provides status updates as needed
Repowering Construction Manager
On-site management of construction contract
Reports to Project Manager and Owner’s Engineer
Responsible for: site meetings, document control, inspections, const. schedule, billings, change management
Coordinates between equipment supplier and BOP contractor

17. Contracting Strategy
Contract directly for Power Island (15 Major Equipment) ≈ $45M
BOP Contract for detail design & installation of Power Island ≈ $51M
Contract design & construction of control room/offices ≈ $12M 17

18. Project Cash Flow
Project Total : $115.4M FY 2013: $1.2M FY 2014: $44.7M FY 2015: $46.2M FY 2016: $23.3M

19. Project Key Dates/Milestones
Environmental Impact Report… 4/8/13
Issued NOP /6/11
Issued Draft EIR /5/12
Public Meeting Held on Draft EIR /12/12
PC Hearing for Draft Final EIR--- 3/13/13
Council Certification of EIR--- 4/8/13
Air Permit (SCAQMD/EPA)… 5/13/13
Submitted applications for GE and RR---6/6/12
Power Island Contract (gas turbine, steam and electric generators)… 7/23/13
Balance of Plant Construction Contract… 2/28/14
Glenarm Building Contract… 2/28/14
Demo/Construction Start 3/3/14
Commercial Operation… 8/10/15

20. Estimated Impact of 100% Bond Financing
$100 million of tax exempt revenue bonds
Estimated pricing date June 1, 2013
30 year, level debt service, estimated 4.0% true interest cost
Annual debt service approximately $7 million
Impact of additional debt service may be reduced by offsetting revenues from ancillary services, wholesale energy transactions and reduced operating expenses due to increased efficiencies