WATER SUPPLY PLANNING COMMITTEE
DISCUSSION ITEM
3.	DISCUSSION OF PURE WATER MONTEREY ADVANCED WATER PURIFICATION ELECTRICAL FACILITIES
Meeting Date:		July 9, 2019	Budgeted:	N/A
From:		David J. Stoldt	Program/
		General Manager	Line Item No.:	N/A
Prepared By:		David J. Stoldt	Cost Estimate:	N/A
General Counsel Approval: N/A
Committee Recommendation: N/A
CEQA Compliance: Action does not constitute a project as defined by the California Environmental Quality Act Guidelines section 15378.

SUMMARY: In October 2016 the Monterey One Water (M1W) Board approved an Energy Supply Option Analysis for the Advanced Water Purification Facilities (AWPF.) Based on the results of that analysis, the AWPF will be served by both PG&E and the biogas electrical generation plant at the Monterey Regional Waste Management District (MRWMD).

In August 2018, MRWMD informed M1W that they were not ready to expand the co-generation system and the proposed PG&E Meter and Switchgear would not be able to be constructed as part of MRWMD’s current PG&E application. The designers worked with MRWMD and M1W staff to come up with an alternative approach to provide power from MRWMD to the AWPF without the need to change the existing PG&E Meter and Switchgear.

The power supply for the AWPF Project is envisioned to come from two sources:

1. PG&E Power. Medium voltage (21kV) power from a new PG&E primary service connection to the AWPF (AWPF MV Switchgear). This would be the initial power for the AWPF to meet the program schedule for producing purified water.

2. MPRWD-to-AWPF Power. Medium voltage (21kV) power from the adjacent MPRWD co-generation facilities. A new MPRWD MV Switchgear would deliver cogeneration power to both PG&E and to the AWPF. The MPRWD-to-AWPF power would be delivered over MPRWD-owned power lines.

Option 2, which is the preferred long-term permanent solution, is not expected to be available for 9-12 months and will cost $300,000 - $400,000. It is likely to undergo bidding and construction after facility operations begin, the Anderson Pacific AWPF construction contract is closed out, and the State Revolving Fund (SRF) loan is finalized and closed. While an attempt will be made to include Option 2 in the SRF loan, early feedback from State staff is that is unlikely to be approved. Hence, the cost of the MV Switchgear is likely to be an unreimbursed construction period cost.

Amendment 3 of the MPWMD-M1W Cost Sharing Agreement says:

1.(d) Unreimbursed Construction Period Costs Defined

From March 1, 2017 through December 31, 2020, there may occur project related costs that are not allowed to be capitalized to the project and paid or reimbursed by State Revolving Fund Loans. Examples of those costs include, among others:

1. Public Outreach

2. Geochemical Water Quality Modeling

3. Groundwater Basin Modeling

4. Facility Expansion Design and Engineering

5. Regulatory Proceedings

6. Expansion Environmental Scoping and Review

7. Expansion Permitting

1.(e) Financing of GWR Unreimbursed Construction Period Costs

MPWMD shall pay seventy-five percent (75%) of such costs, and M1W shall pay twenty-five percent (25%) of such costs.

It is unclear if M1W will be in a position to pay its 25%, due to incomplete reimbursement to date of the wastewater revenues expended for the project and Proposition 218 limitations on additional expenditures for water supply purposes.

RECOMMENDATION: The Committee should discuss funding options available for the MV Switchgear.

BACKGROUND: The MPRWD cogeneration facility, located adjacent to the AWPF site, produces power that is presently sold to PG&E. Monterey One Water (M1W) negotiated with the MPRWD to provide some of the cogeneration power directly to M1W for the AWPF project.

Because the MPRWD MV Switchgear would be changed to permit providing power to both PG&E and the AWPF, it was the team’s (MPRWD, M1W and Kennedy Jenks) understanding that PG&E consultation and approval would be needed for constructing and implementing the MPRWD-to- AWPF power supply. The MPRWD had already submitted an application in 2015 to the PG&E Generation-Distribution Planning/Interconnection Group for changes to the MPRWD’s service connection.

From discussions with PG&E Service Planning Group, it was the team’s understanding that a new MPRWD MV Switchgear to provide power to both PG&E and the AWPF would need review by the Distribution Planning/Interconnection Group and could be a part of the MPRWD’s 2015 service application change.

M1W submitted a separate application to PG&E Service Planning Group in November 2016, for a new primary service to the AWPF Project. The team’s approach was to focus on getting the relatively straight-forward new primary service to the AWPF, in parallel with working with PG&E for the consultation and approvals that would be needed for constructing and implementing the MPRWD-to-AWPF power supply system.

A summary of the timelines for the PG&E Power and the MPRWD-to-AWPF Power for the AWPF Project are provided below:

AWPF Power and MPRWD-to-AWPF Power Timeline

· MPRWD submitted service change application to PG&E Generation/Interconnection Group – 2015.

· M1W submitted application for AWPF MV service to PG&E Service Planning Group – Nov. 2016 along with 60% design drawings.

· Discussed MPRWD-to-AWPF power concepts with PG&E Service Planning Group – March 2017.

· Completed AWPF MV Switchgear design. Bid with overall AWPF project – May 2017. Submitted final AWPF MV service design drawings to PG&E.

· Completed 90% MPRWD-to-AWPF Design – submitted to MPRWD for Review – Sept. 2017

· Completed 100% MPRWD-to-AWPF Design – submitted to MPRWD for Review – Jan. 2018

· Discussed MPRWD-to-AWPF power concepts with PG&E Service Planning Group – Feb 2018. Was told to contact the Generation/Interconnection Group for this coordination.

· Received preliminary PG&E Service drawings for the AWPF MV Switchgear in March 2018. Met with PG&E at AWPF site.

· MPRWD communicated with PG&E Generation/Interconnection Group about the MPRWD-to-AWPF power concepts – August 2018. Was told to contact the PG&E Service Planning Group for this coordination.

· MPRWD requested a meeting with both PG&E Generation/Interconnection Group and Service Planning Groups to correct mis-understandings and conflicting information from PG&E regarding consultation and approval for the MPRWD-to-AWPF power supply – August 2018.

· AWPF Power: PG&E Conduit installed to AWPF MV Switchgear location. Installed switchgear in Sep 2018.

· Requested PG&E install meter and power conductors in October 2018.

· PG&E Power available late 2018.

· Authorized re-design of new MPRWD MV switchgear based on MPRWD and PG&E comments to the MPRWD-to-AWPF Design.

EXHIBIT
None

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