REPORT TO COUNCIL
SUBJECT
Title
Agreement for Services with Precision IceBlast Corporation for Cleaning of Heat Recovery Steam Generators at the Donald Von Raesfeld Power Plant
Report
BACKGROUND
Silicon Valley Power’s Generation Division operates the Donald Von Raesfeld Power Plant (DVR), the City’s largest in-city generation facility, a 147 MW natural gas-fired combined-cycle plant which was placed in service in 2005. The plant has two horizontal gas flow ATS/Express Heat Recovery Steam Generators (HRSGs) that use waste heat to create steam for power production. Over time iron oxides, ammonia salts, mineral deposits, and dirt adhere to the heat transfer surfaces which reduces the effectiveness of the transfer of thermal energy to create steam, thereby reducing power output of the facility. The current fouling of the HRSG heat transfer surface requires the cleaning of finned tubing that comprise the low pressure economizer section and the low pressure evaporator section in each of the two HRSGs.
DISCUSSION
On January 11, 2018, SVP sent out a Request For Proposals for Heat Recovery Steam Generators (HRSG) cleaning. SVP received 2 proposals which ranged in price from $389,550 to $399,504 over a three year period. Precision Iceblast Corporation was determined to be lowest responsible and responsive proposer able to meet all requested activities. The proposals were reviewed for compliance with the terms and conditions of the Request for Proposal and any necessary correction regarding tube spreading were made. Staff recommends awarding the contract to Precision IceBlast.
Fouling of the heat transfer surfaces in the HRSG has reduced electrical energy output from the DVR Power Plant. Cleaning of the low pressure economizer and low pressure evaporator finned tubing is required to return the DVR Power Plant to maximum achievable operating efficiency and power output. Cleaning the heat transfer surface is expected to increase annual revenue by an estimated $150,000 per unit or $300,000 for the entire plant. This is less than a one year pay-back. Failure to perform the cleaning will result in increased fuel use and operating costs and lower power output. The derating of the plant output will limit SVP’s ability to serve our electric customers in the most economical manner. The loss of power generation will result in procurement of electricity from outside of SVP and increase energy costs. Ice blasting of the heat transfer surface is the most economical method of cleaning the finned tubing. Precision IceBlast was selected based on lower costs and they employ an improved methodology between the tubes which yield in improved results.
ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378(a) as it has no potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.
FISCAL IMPACT
The total cost of the Agreement for the Performance of Services with Precision IceBlast Corporation will not exceed $190,000 the first year, and subject to future appropriations, a total of $401,539 over a three (3) year period. Sufficient funds are available in Electric Department Generation Operating Maintenance account.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov <mailto:clerk@santaclaraca.gov> or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
Approve an Agreement for the Performance of Services with Precision IceBlast Corporation for Cleaning of the Heat Recovery Steam Generators (HRSGs) at the Donald Von Raesfeld Power Plant, in an amount not-to-exceed $190,000 the first (1) year, with a total not-to-exceed amount of $401,539 over the three (3) year term.
Staff
Reviewed by: John C. Roukema, Chief Electric Utility Officer
Reviewed by: Angela Kraetsch, Director of Finance
Reviewed by: Brian Doyle, City Attorney
Approved by: Walter C. Rossmann, Chief Operating Officer
Approved by: Deanna J. Santana, City Manager
ATTACHMENTS
1. Agreement for the Performance of Services with Precision IceBlast Corporation
2. Exhibit A Attachment