Excerpt from
MPRWA Request for Proposals
5.0 SCOPE OF SERVICES
Each of the proponents of the three
desalination projects was asked by the Authority to respond to a specific set
of questions, including cost-related inquiries.
Each proponent’s response is included as an attachment to this
solicitation or is available on the MPRWA website at www.mprwa.org. The responses have supporting documentation
in various stages of development. Respondents will need to address the
variations in data quality. For example,
project proponents were asked to examine two plant sizes: 9,000 acre-feet or
5,500 acre-feet – however, the proponents did not each provide such data. Responding Contractors may also review
information from a proponent’s website or contact the project proponent
directly. Proponent information is as
follows:
California
American Water Company www.watersupplyproject.org
Richard
Svindland Richard.Svindland@amwater.com 916-568-4296
DeepWater Desal, LLC www.deepwaterdesal.com
Brent Constantz brent@dwdesal.com 831-632-0616
Peoples’ Moss
Landing Desal www.thepeoplesmosslandingdesal.com
George Schroeder ddgeo@sbcglobal.net 831-601-4878
The Contractor will be retained to
provide an independent, unbiased, third-party assessment of the three proposed
desalination projects. The selected contractor will provide a report and attend
at least one presentation to the MPRWA board.
There are six specific items as to project scope, as described below.
5.1
Initial Scoping and Constraints Analysis
In order to reduce overall cost
and scope of work, the Contractor is asked to first evaluate each project at a
high level and ascertain if there are any key constraints that would render a
project unlikely to be implemented at reasonable cost by January 1, 2017. The criteria shall be determined by the
Contractor, but might include technical feasibility, reliability, permitting,
litigation risk, environmental factors, regulatory, schedule, or cost. Further, if the Contractor identifies ways to
improve upon any one of the three proposals, or a viable alternative, MPRWA
seeks that opinion in advance of additional detailed evaluation.
5.2
Comparison of Cost Estimates for the Three Desalination Projects
For
projects that were not eliminated under 5.1 above, Contractor
shall review the following as presented by the project proponents:
·
Capital
costs
·
Operating
costs
·
Unit
costs (especially $ per acre foot)
·
Energy
consumption/efficiency/cost
·
Quality
of cost estimate (conceptual, preliminary, bid, etc.)
·
Age
of cost estimate
Compare
the proposed projects based on total capital cost, annual operating plus
capital cost, and annual unit cost based on water delivered to the Peninsula. The Contractor will identify differences in
each proponent’s cost methodology and attempt to “normalize” or adjust for
differences in order to provide more directly comparable results. The goal is an “apples-to-apples” comparison. It is desired to have cost comparisons for
projects of two sizes: (a) one that
delivers 5,500 acre-feet per year to the Peninsula, and (b) one that delivers
9,000 acre-feet per year.
In
the analysis, identify key differences in each proponent’s methodology and
attempt to adjust therefor across all projects in order to compare on a common
basis. Attention should be paid to use
of contingencies, implementation costs, adjustments for high- or low-end of cost
range, and so on. If a project’s costs
are based on a portion of a larger project, please identify the risks
associated with a larger project and the potential impact on cost if built as a
stand-alone facility.
Discuss the
primary drivers for differences in cost between the projects. Identify assumptions or conclusions of any
proponent that are questionable or inconsistent with other proponents;
inconsistent assumptions should be adjusted where possible and cost figures
modified accordingly.
5.3 Identify and Isolate Project Differences
Contractors are
asked to identify major differences in project features that are not the core
desalination components – that is, if all desalination facilities are assumed
to all be the same for each of the projects, what are the key differences
between the projects in the areas of intake, pre-treatment, outfall, and
transmission pipeline? Have the
proponents used consistent cost assumptions on things like pipe, right-of-way, and
other items? Can the projects be
compared on the “non-desalination” aspects?
5.3
Evaluation of Schedule
Please review each project’s timeline and provide an
opinion as to the reasonableness of each.
5.4
Evaluation of Financing Options
Examine each proponent’s financing assumptions and
comment where applicable. Are there
assumptions or conclusions in the proponents’ materials with which you
disagree? Why? How would cost estimates for each project be
affected?
5.5
Workshop/Presentation/Written Report
A written report of findings is expected by August
31, 2012 in order to provide sufficient time for MPRWA to include findings in
it testimony to the CPUC presently scheduled for mid-September.
In addition to a written report, the Contractor is
expected to present its findings to the MPRWA at a meeting to be scheduled.
The Contractor is also expected to attend CPUC
workshops tentatively scheduled for July 26th and/or 27th.
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