In November of 2018, the SCAQMD amended Rule 1135: Emissions of Oxides of Nitrogen from Electricity Generating Facilities to reduce the current emission limit for NOx for gas-fired boilers and gas turbines from 5 parts per million by volume (ppmv) to 2.5 ppmv. The new emission limit is effective on January 1, 2024.
BWP contracted with Fossil Energy Research Corporation (FERCo) in June 2018 to evaluate the current emissions system and determine whether it could meet the new limit.
FERCo determined that the current emissions system would not be able to meet the new limit due to inadequate mixing. In January of 2020, a feasibility study was also prepared by FERCo to assess whether the existing system could be modified to meet the new limit.
FERCo found thai the new emission limit could be achieved by moving the existing ammonia injection system upstream, adding turning vanes to improve mixing, and replacing both catalysts with a single, more effective multi-pollutant catalyst.
This project consists of designing, engineering, permitting, constructing/installing, commissioning, and testing the new emissions system at the LOPP.
DISCUSSION
To secure the most competitive bid for this work, BWP conducted a request for proposals process based on a detailed scope of work. ARB was the only vendor who submitted a bid and deemed qualified. The bid was evaluated and scored based on technical merit and pricing. After negotiation with the bidder, BWP was successful in reducing the final cost and ensuring that the scope was aligned with the project's design intent.
The agreement contains the city's standard terms and conditions and reflects the comprehensive scope of work specified by BWP (Attachment 2). The work will be completed by May 1, 2023, well in advance of the regulatory deadline on January 1, 2024.
The detailed technical specification in the agreement ensures that product quality will be built-in, and the supply of major equipment will be from known reputable equipment suppliers. Performance testing requirements and guarantees are included in the agreement terms and conditions.
The contractor has agreed to a defined scope and provided a lump-sum cost proposal to implement the improvements. With the execution of the proposed lump-sum turnkey agreement, the risk of cost overrun is reduced significantly as opposed to a time and material agreement. The remaining risk exposure is minimal and is adequately covered by contingency reserve that remains in the project budget. Schedule risk is addressed with the inclusion of provisions for liquidated damages.
In addition, the current catalysts are projected to reach their end-of-life and require replacement within the next 6 to12 months. This project will avoid a maintenance cost of approximately $1,450,000 associated with replacing the current catalysts like-in-kind.
FISCAL IMPACT
The cost of the proposed agreement is $2,076,562. Funds are budgeted and will be encumbered in the fiscal year 2022-2023 budget.
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