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Home My WebLink About04.a. Review draft Position Paper to authorize the General Manager to execute a pre-purchase contract with APG-Neuros for three electric blower systems and special services in an amount not to exceed $2,998,000 under the Electric Blower Improvements, Dis Page 1 of 10 Item 4.a. CENTRAL SAN BOARD OF DIRECTORS . , , . POSITION PAPER . , 0 DRAFT MEETING DATE: NOVEMBER 3, 2020 SUBJECT: REVIEW DRAFT POSITION PAPER TO AUTHORIZE THE GENERAL MANAGER TO EXECUTE A PRE-PURCHASE CONTRACT WITH APG- NEUROS FOR THREE ELECTRIC BLOWER SYSTEMS AND SPECIAL SERVICES I N AN AMOUNT NOT TO EXCEED $2,998,000 UNDER THE ELECTRIC BLOWER IMPROVEMENTS, DISTRICT PROJECT 10015 SUBMITTED BY: INITIATING DEPARTMENT: NITIN GOEL, SENIOR ENGINEER ENGINEERING AND TECHNICAL SERVICES- CAPITAL PROJECTS REVIEWED BY: NANCY MOLINA, ASSOCIATE ENGINEER NATHAN HODGES, SENIOR ENGINEER EDGAR J. LOPEZ, CAPITAL PROJECTS DIVISION MANAGER JEAN-MARC PETIT, DIRECTOR OF ENGINEERING AND TECHNICAL SERVICES ISSUE The Board of Directors (Board) authorization is required for purchases or contracts above $200,000 in the Capital Program. BACKGROUND Central San's three existing aeration blowers supply air to four aeration basins, pre-aeration system (grit removal), final effluent, and mixed liquor channels. Two of the three blowers, installed in 1974, are steam- driven turbine blowers using steam produced from the heat recovery process from the furnace's waste heat boilers, cogeneration system waste heat boiler, and augmented by the auxiliary boilers. The third blower is driven by an electric motor which serves as a backup when the steam system is shut down for maintenance or under emergency scenarios. However, there are several major shortcomings associated with the existing electric blower. The findings of a recent condition assessment and capacity analysis are that the existing electric blower does not provide adequate redundancy (only produces air up to 30,000 standard cubic feet per minute (scfm)) and does not meet peak aeration demand (over 70,000 scfm). The electric blower also presents uncertain reliability with the standby power generation system due to the high in-rush current due to its 2,000-horsepower electric motor (this motor is not equipped with a soft start or variable frequency drive (VFD)). Other deficiencies include limited turndown capabilities and it November 3, 2020 EOPS Regular Committee Meeting Agenda Packet- Page 4 of 41 Page 2 of 10 cannot be operated in parallel with the larger steam blowers (controls and sync issues). Therefore, the existing electric blower does not provide a reliable backup for process air supply. As presented to the Board on July 16, 2020, the replacement of the existing electric blower and addition of new electric blowers is now of critical importance to Central San for two main reasons: 1. Because of the increased potential for PG&E Public Safety Power Shutoffs (PSPS), as a prevention to wildfires or other fire danger in northern California, it is now evident that the lack of PG&E grid power supply reliability during the summer or fall months presents many new challenges to the treatment plant and to the blower system. Under a PS PS, the plant would need to rely on its own power generation (CoGen) and diesel standby facilities. Summer and fall seasons are also the times of year when the plant requires the highest air flow rate to be available for the biological process. The existing electric blower does not produce enough air and cannot reliably start on the diesel standby generators. Therefore, staff recommends adding three new electric blowers in the existing Pump and Blower Building (PBB). With three new electric blowers, this new system will be capable of providing full backup to the existing steam- driven blowers and also be compatible with the current operating characteristics. Three blowers would provide for full capacity with one blower out of service. The new blowers have smaller electrical motors and are equipped with VF Ds which will allow their use with the existing standby power generators. 2. Central San plans to perform major construction within its Solids Conditioning Building (SCB) under the Solids Handling Facility Improvements Project (Solids Project). The SCB houses many of the critical equipment and systems to that are required to produce the steam necessary to power the steam-driven blowers, and elements of the Solids Project will impact the steam production. During construction of the Solids Project, several unit processes will need to be offline for short or potentially extended periods to facilitate construction sequencing, reduced risk of unplanned shutdowns, and improve safety for staff and the contractor. These shutdowns will impact the quantity of steam available to produce the air flow rate required by the treatment plant for peak air demand conditions. The Board had authorized staff at its July 16, 2020 meeting to initiate a separate project titled the Electric Blower Improvements, District Project 10015 (Project) and to complete the final design with HDR, Inc. (HDR).At that time, staff also proposed to pre-purchase the electric blowers since the equipment had very long lead times due to the design and manufacturing process and to have installed ahead of the Solids Project planned shutdowns of steam equipment. On September 18, 2020, staff advertised a formal Request for Qualifications and Bid on PlanetBids for two new electric blowers, plus an optional third, each with a capacity of 35,000 scfm and associated equipment. Requesting qualifications was needed since there were many site and project specific requirements that the vendors had to meet, including the ability to fit within the existing PBB blower area facility and connections to the electrical and mechanical systems in order to minimize overall project cost and maximize reuse of existing assets. HDR and Central San reached out to several manufacturers and were only able to confirm one vendor that could meet the project specifications,APG-Neuros. Other vendors were contacted and known to have the potential to meet the qualifications; therefore, staff elected to include an "or equal' section to the qualification process to determine if the specifications could be achieved by others. The qualification and bid process allows only the qualified vendors to participate in the opening of bids. The notice to bidders was very clear and transparent that Central San qualifications included the ability to specifically use the existing building and infrastructure without having to make costly improvements to accommodate any proposed blower or other items that were significant to the specifications. On October 14, 2020, Central San received interest or qualification packages from two electric blower vendors (APG-Neuros Inc. and Howden Roots LLC).APG-Neuros was the specified blower and Howden Roots LLC is the original vendor of the existing steam and electric blower. Howden Roots LLC proposed November 3, 2020 EOPS Regular Committee Meeting Agenda Packet- Page 5 of 41 Page 3 of 10 Turblex blowers. Limited participation was anticipated for this procurement. Each bid submittal package contained two parts: Part 1 - Qualifications and Part 2 - Bid. Qualifications included technical requirements, ability to fit and operate the equipment within the existing building and infrastructure, successful installation(s), availability and location of service centers for future maintenance and spare parts, power requirements and efficiency, and ability to meet the allowable noise levels. Central San staff and HDR conducted an extensive evaluation of the qualifications and determined that the Howden Roots LLC Turblex blower was unable to meet the qualifications. This determination came after a detailed review and several clarifications and meetings with the vendor. Although many of the criteria was determined to be comparable to the specifications, ultimately the decision was made not to qualify due to two significant reasons, the proposed equipment did not fit within the existing infrastructure and the heat generated by the system with the sound enclosure could not be satisfactorily addressed as part of the technical specifications for the Project. Bids included special services to coordinate the shop drawings with the installation design, costs for two blowers and associated equipment, major electrical components such as VFDs, electrical control panels including programmable logic controllers (PLCs), electrical transformers, cost for an optional third blower, optional services such as an extended warranty, additional controls integration with the existing blowers, training, and future annual maintenance costs. Staff opened the bid for AP G-Neuros on October 28, 2020 and received a cost of$1,972,300. The Engineer's estimate was $2,600,000. The electric blowers submitted are powered by a 1,500-horsepower motor. The Bid also required pricing to be provided for additional scope and services. After a detailed evaluation of the optional services and consulting with the Operations division, staff is recommending to include the following: • Third blower system to replace the existing electric blower. This will allow for all the electric blowers to operate in sync and provide the best long-term solution for redundancy and capacity at a cost of$750,000. •Additional three-year correction warranty at a cost of $70,000. • Routine spare parts for$92,000. • PLCs to operate the new blowers in combination with the steam blowers for$9,000. Maintenance costs and scope were received and will be forwarded to the Operations Division. The costs for a five-year maintenance service agreement totaled $182,470 with an optional $10,000 for additional staff training. The costs for maintenance are not included in the Project and will be addressed by staff at a future date once the equipment is installed as part of the Operating budget. ALTERNATIVES/CONSIDERATIONS The Board could consider the following alternatives or provide other direction: 1. Postpone or delay the installation of the third blower, which is not recommended. Adding a third blower is the most cost-effective alternative compared to retrofitting the existing electric blower or providing additional blowers for the secondary process, which has been evaluated by the project team. Also, it is not recommended to have three different types of blowers with different operating curves. It is highly unlikely that the blowers will all be able to operate together due to the complexity of the programming needed for this to happen. In addition, these new electric blowers have been considered as part of the long-term improvements to the Steam and Aeration Blowers System project and thus will not become stranded assets. 2. Do not award a pre-purchase contract and include the equipment for procurement under a general contractor and a Central San construction contract. Central San received a low bid from a qualified blower vendor and due to the lead times for the equipment, complexity, and specialized nature of the installation November 3, 2020 EOPS Regular Committee Meeting Agenda Packet- Page 6 of 41 Page 4 of 10 design, it is recommended to enter into a contract with the vendor to complete shop drawings and finalize the design with Central San prior to bidding for an installation or general contractor ahead of the Solids Project. Both alternatives are not recommended. FINANCIAL IMPACTS The total anticipated cost for the pre-purchase contract is $2,998,000, which includes the following: • Item 1: $1,972,300 for special services, two blower systems, programming, startup, commissioning, and training; • Item 2: $750,000 for a third blower system; • Item 3: $171,000 for an extended warranty, spare parts, and additional programming; and • Item 4: $104,700 in contingency(approximately five percent of Item 1)for potential changes during design. The total estimated project cost for the Project is $12.5 million. There are adequate funds within the current project budget for the pre-purchase contract costs, which was anticipated in the estimated construction budget; therefore, no additional funds are needed or being requested. COMMITTEE RECOMMENDATION The Engineering and Operations Committee reviewed this item at the November 3, 2020 meeting and recommended RECOMMENDED BOARD ACTION Authorize the General Manager to execute a pre-purchase contract with APG-Neuros for three electric blower systems and special services in an amount not to exceed $2,998,000 under the Electric Blower Improvements Project, District Project 10015. Strategic Plan Tie-In GOAL TWO:Environmental Stewardship Strategy 1—Achieve 100%compliance in all regulations, Strategy 2—Anticipate and prepare for potential regulatory changes GOAL FIVE:Infrastructure Reliability Strategy 1—Manage assets optimally to prolong their useful life, Strategy 2—Execute long-term capital renewal and replacement program, Strategy 3—Protect personnel and assets from threats and emergencies GOAL SIX:Innovation and Optimization Strategy 2—Improve and modernize operations through technology and efficiency measures ATTACHMENTS: 1. Presentation November 3, 2020 EOPS Regular Committee Meeting Agenda Packet- Page 7 of 41 Page 5 of 10 / DISTRICT PROJECT (DID) 10015 I irJ ELECTRIC BLOWER IMPROVEMENTS - BLOWERS PROCUREMENT Engineering and Operations Committee Meeting -Y= November 3, 2020 Edgar J. Lopez, Capital Projects Division Manager Nathan Hodges, Senior Engineer I DRIVERS FOR DP 10015 ELECTRIC BLOWER IMPROVEMENTS Allows prolonged shutdown of the furnaces and associated waste heat boilers during the construction of Solids Handling Facility Improvements, DP 7348 (Solids Project). Provide reliable aeration air during steam or PG&E power outages at the treatment plant. Addition of electric blowers does not lead to stranded assets. Improved electric blowers are recommended under all future alternatives (short- and long-term) for 1:f: reliable redundancy. CFNTPAISAN November 3, 2020 EOPS Regular Committee Meeting Agenda Packet- Page 8 of 41 1 Page 6 of 10 LOCATION: NEW ELECTRIC BLOWERS WILL BE INSTALLED IN THE EXISTING PUMP AND BLOWER BUILDING Existing Electric Blower#3 to be replaced with New Electric Blower New Electric Pump and Blower Blower#5 Existing Steam Building Blower#2e 2 To ar •` Remain - c Existing Steam Blower#1 To Remain - r i New Electric i Blower#4 ZAJ CFNTPAISAN BLOWER SUPPLIER SCOPE OF WORK • Three new electric blowers • Provide full backup to steam system/blowers, including meeting peak aeration demands • Compatible with existing steam blowers • Electrical equipment • Transformers to convert 12,000-volt (V)feed from treatment plant electrical system to 480 V, the voltage suitable to power the blower motor • Variable frequency drives to power motor efficiently and achieve lower air supply • Instrumentation and Controls • Air flow meters, pressure sensors, and other instruments for the new blowers that will conform with Central San standards • Local control panel and operator interface terminal for each blower • Master blower control panel and programming to operate all blowers ' ZV 4 November 3, 2020 EOPS Regular Committee Meeting Agenda Packet- Page 9 of 41 2 Page 7 of 10 BID PROCESS TIMELINE • Electric Blower Improvements Project presented on July 7, 2020 to Engineering and Operations (E&O) Committee and approved at Board meeting on July 16, 2020 • Staff posted Request for Qualifications and bids for blower equipment and services on September 18, 2020 • Received two submittal packages on October 14, 2020. Staff reviewed the qualifications part of each bid package and determined only one supplier met the criteria: APG-Neuros I5 BID RESULTS • Staff opened the bid package and received costs of $1,972,300 for two blowers and special services (design assistance, field testing, control system programming, etc.) • The Engineer's estimate is $2,600,000 • Alternative bid items being recommended are: • $750,000 for third blower system • $171,000 for extended 3-year warranty, routine spare parts, and additional programming 16 CFNTPAI SAN November 3, 2020 EOPS Regular Committee Meeting Agenda Packet- Page 10 of 41 3 Page 8 of 10 ELECTRIC BLOWER IMPROVEMENTS TOTAL ESTIMATED EQUIPMENT PROCUREMENT COST The total anticipated cost for the pre-purchase contract is $2,998,000, which includes the following: • Item 1 : $1 ,972,300 for engineering services, two blower systems, startup, commissioning, and training; • Item 2: $750,000 for the third blower system; • Item 3: $171 ,000 for an extended warranty, spare parts, and additional programming; and • Item 4: $104,700 in contingency (approximately 5% of equipment for Item 1) for potential changes during design. I7 PROJECT FUNDING •The total estimated project cost is $12.5 million • Pre-purchase contract costs anticipated in the construction budget • No additional funds being requested improvementsElectric Blower .. FY 2020-21 Future FYs Total • $0 $0 $0 $1,250,000 $0 $1,250,000 Construction $500,000 $10,750,000 $11,250,000 $1,750,000 $10,750,000 $12,500,000 November 3, 2020 EOPS Regular Committee Meeting Agenda Packet- Page 11 of 41 4 Page 9 of 10 AGGRESSIVE SCHEDULE FOR ELECTRIC BLOWER IMPROVEMENTS Esmateen Year 2020 Year 2021-2023 theSolidsPoettime Whmay be impacted. July 16 Aug 31 Nov.19 Feb-Mar 'May-June August Nov. 2020 2020 2020 2021 2021 2021-Sept 2022 2022 Board 10% Design Equipment 100% Installation Construction Completion Approval Submittal Procurement Submittal Contractor Award at Bid/Award Board Meeting ' 9 19391TY'Vow-M2 BOARD ALTERNATIVES • Postpone or delay the installation of the third blower, which is not recommended. Adding a third blower is the most cost-effective alternative compared to retrofitting the existing electric blower or providing additional blowers for the secondary process. Also, it is not recommended to have three different type of blowers, since its nearly impossible to operate together due to the complexity of the programming needed and equipment runs differently. • Do not award a pre-purchase contract and include the equipment for procurement under a Central San construction contract which is not recommended. Staff received a low bid from the blower vendor and due to the lead times for the equipment, complexity, and specialize nature of the installation design, its recommended to continue with a pre-purchase. 10 UNTWITIff M, November 3, 2020 EOPS Regular Committee Meeting Agenda Packet- Page 12 of 41 5 Page 10 of 10 RECOMMENDED BOARD ACTION • Authorize the General Manager to execute a pre-purchase contract with APG-Neuros for three electric blower systems and special services in an amount not to exceed $ 2,998,000 under the Electric Blower Improvements, District Project 10015. QUESTIONS? CFNTPAISAN November 3, 2020 EOPS Regular Committee Meeting Agenda Packet- Page 13 of 41 6