PURPOSE

This memo requests the City Council approve the Lake One LM6000 Selective Catalyst Reduction (SCR) Upgrade and NOx Catalyst Project as a design-build project and to award this project to Turner Envirologic, Inc. (TEI) for $726,095. BWP received proposals associated with this project, RFP No. 1181, from TEI, Applied Utility Systems, and ARB, Inc. We have evaluated their proposals and recommend awarding this project to TEI due to the following reasons:

1. Meets all technical requirements

2. Meets all performance guarantees

3. improves long-term reliability of the SCR

4. Past performance on the Lake One LM6000 SCR Performance Improvement and CO Catalyst Upgrade Project

BACKGROUND

In 2002, BWP constructed Lake One, a simple cycle gas turbine peaker equipped with the Selective Catalytic Reduction (SCR) system designed by Hamon for emission control.  It is one of the few such simple cycle gas turbines of this type to utilize an SCR.  In addition, the SCR is required to reduce emissions to very low levels.

While the SCR has performed as required, BWP staff has found that the flow of exhaust gases is concentrated near the bottom portion of the SCR rather than uniformly distributed from the top to the bottom and the ammonia injection nozzles are not properly spaced.  The uneven flow characteristic results in lower performance and lessens the useful life of the catalyst. The catalyst wears out at a much faster rate where the exhaust flow is concentrated at the bottom; while the top part of the catalyst where the exhaust gas concentration is low has very little wear.  By improving the flow both the top and bottom will wear out at the same time, last longer, and do a better job of removing the emissions.

In 2003, BWP staff developed the request for proposal for improving the exhaust flow in the Lake One SCR and replacement of the CO Catalyst.  The RFP was developed in conjunction with numerous discussions with potential vendors to assure that all-important technical considerations were addressed, that the work could be completed by summer, and that competitive responses would be generated.  The work was completed in May 2004 with significant improvement in exhaust flow distribution and CO emissions.

In the course of the Lake One operation, the NOx catalyst began to show signs that portions of the catalyst were soon to require replacement.  A failure of any portion of the catalyst results in a failure of the catalyst.  It was determined that the Lake One NOx catalyst would require replacement.

In December 2004, BWP staff developed the request for proposal for the design, procurement, modification and installation of the NOx catalyst replacement including upgrade to the ammonia injection system, if needed.

Three qualified bidders had submitted their proposals.  They are Turner Envirologic, Inc. (TEI), Applied Utility Systems (AUS), and ARB, Inc (ARB).  We have evaluated their proposals based on the following evaluation criteria.

25%     Qualifications

            40%     Technical

            20%     Price

            10%     Schedule

  5%     Liability Insurance/Bonding Coverage

The results from the evaluation consist of 97% for TEI, 90% for AUS, and 85% for ARB.

ARB proposed to replace the existing Engelhard NOx catalyst with Cormetech catalyst.  However, the proposed Cormetech catalyst has higher-pressure drop and higher ammonia consumption than the existing system.  In addition, the ARB proposal took exception to the City bonding terms and conditions.

TEI and AUS proposed the same Haldor Topsoe catalyst to replace the existing Engelhard NOx catalyst.  The AUS proposal for the design and installation of the NOx Catalyst replacement is $91,862 higher than the TEI proposal for the same scope of work.

The TEI proposal also includes replacement of the ammonia injection system in order to achieve more uniform application of ammonia across the NOx catalyst to promote NOx reduction and minimize ammonia slip.  This would improve the long-term reliability of the ammonia injection system in order to meet stringent NOx emissions and ammonia slip as required by SCAQMD. 

In addition, TEI was the contractor for the LM6000 SCR Performance Improvement and CO Catalyst Upgrade Project.  TEI completed the design and installation of the exhaust flow correction devices and CO catalyst within nine weeks and ahead of schedule.  This project achieved significant improvement in the exhaust flow distribution and reduction of the CO emissions below the SCAQMD permit level.  BWP staff was pleased with TEI performance.

We recommend awarding the project to TEI for the following reasons:

• Meets all technical requirements

• Meets all performance guarantees

• Improves long-term reliability of the SCR

• Past performance on the Lake One LM6000 SCR Performance Improvement and CO Catalyst Upgrade Project

ANALYSIS

BWP staff recommends TEI for the LM6000 SCR Upgrade and NOx Catalyst Replacement.  Scope of work includes the following items, but not limited to:

• Replacing existing NOx catalyst with Haldor Topsoe DNX-640 and modification to the existing support structure and air seal system with additional stainless steel structural members

• Two 100% tempering air fans for cooling exhaust gases to 800�F or below with variable frequency drives to control dilution air.

• Ammonia vaporization skid and ammonia injection grid to provide even mixing and distribution of ammonia based on NH3: NOx ratio of one within +/-10% RMS deviation.

• Inlet silencer for cooling air fans to achieve 85dba at 3 feet.

• All required piping and wiring for the proposed system.

• PLC controls for system operations, cooling fans, and ammonia vaporization skid.

• All required foundation

The contractor will guarantee the following:

• 90% NOx reduction for 5 years or 18,000 hrs of operation, whichever comes first.

• Pressure drop across the NOx Catalyst to be less than 3.0� W.C

• Ammonia slip will be less than 3.5 ppm with a maximum flow of 115 lb/hr based on 35 ppm exhaust NOx.

FISCAL IMPACT

It is proposed to utilize the remaining budget of the BWP�s overall master yard plan for the SCR Upgrade and NOx Catalyst Replacement Project. The master yard plan budget consists of $2,101,000 earmarked for the demolition of Magnolia 3, 4 and 5 and removal of Olive 3 and 4 Waste Heat Boilers and shop building.   Cleveland Wrecking is currently performing the Demolition Project and scheduled to complete this project on March 1, 2005.  It is estimated that the completion cost for the demolition project will be approximately $1,251,000. The remaining budget of $850,000 is proposed to be used for the SCR Upgrade and NOx Catalyst Replacement Project.

ENVIRONMENTAL REVIEW

This project is exempt from review under the California Environmental Quality Act (CEQA) under section 15301(a) of the State CEQA Guidelines (repair to mechanical equipment involving negligible or no expansion of use.)

RECOMMENDATION

Staff requests the City Council to approve the Lake One LM6000 SCR Upgrade and NOx Catalyst Project as a design-build project and to award this project to Turner Envirologic, Inc. for $726,095.

If the Council concurs, the appropriate action would be a motion to adopt the Resolution entitled �A RESOLUTION OF THE COUNCIL OF THE CITY OF BURBANK APPROVING AND AWARDING A DESIGN AND CONSTRUCTION SERVICES AGREEMENT TO TURNER ENVIROLOGIC, INC. FOR THE LM6000 SCR UPGRADE AND NOx CATALYST REPLACEMENT PROJECT (REQUEST FOR PROPOSAL NO. 1181).�

RD:FCF:tl

Scr upgrade � council 2-15-05.doc

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