Golden Sate serves important commercial load, but has had a recent history of worrisome outages. Golden State provides electric power to 280 commercial customers, including the Empire Center, Bob Hope Airport, Valley Pumping Plant, and the M. David Paul complex at Empire Avenue and Ontario Street, including Yahoo.com building. On October 19, 2005, all of Golden State was out of service for 4.5 hours; and only days later, on October 23, 2005, all of Golden State was out of service for 8.5 hours. For BWP, any station outage is unusual, much less one that lasts several hours.

After the outages occurred, field crews quickly isolated the initial cause to a cubicle in Golden State�s enclosed 12,470-volt switchgear. The continuous-buss switchgear design forced the crews to test and inspect every cubicle before restoring power, which took hours. Shortly after the October outages, the General Manager and senior staff met with concerned customers to explain the outages and why they were so long.

In spite of its maintenance efforts, BWP still believes the 12,470-volt switchgear at Golden State is a point of vulnerability. Since October 2005, there have been no further Golden State outages. But in late 2006, the switchgear�s 12,470-volt buss was making noise. Because loading on Golden State was low, crews were able to do a thorough inspection by transferring load from and first isolating one half of Golden State, then the other. (However, the amount of switching in the field was considerable.) At that time, and with the concurrence of the switchgear manufacturer, BWP replaced certain insulators, underground cable terminators, and other parts.

At present, staff is operating Golden Sate in a nonstandard fashion, for the sake of making the switchgear more reliable. The incident in late 2006 reinforces staff�s opinion that Golden State�s switchgear may be outage prone in spite of the recent and extensive maintenance it has received. For this reason, BWP has continued to keep out of service the cubicle that had caused the October 2005 outages. The consequence is that the two halves of the switchgear remain electrically isolated from each other, each half receiving power from only one transformer bank.

Normally, Golden State�s two transformer banks would feed the entire switchgear; if one bank failed, the other bank, with its spare capacity, could supply all the needed power. (Even during last summer�s unusual heat wave, a single Golden State transformer taking on the entire station load would have been overloaded by only 7.2 %.) With the transformer banks isolated, the outage of one bank would cause half of Golden State�s customers to be out of service. However, staff has judged that the risk of a transformer failing, and therefore taking half of Golden State�s customers out of service, is less than the risk of the isolated cubicle failing, and possibly taking all of Golden State�s customers out of service for a prolonged period.

Staff has found a good short term solution. BWP has very limited ability to transfer Golden State load to other substations; Golden State is more electrically isolated than the typical BWP substation. This raises the specter of days-long outages should the switchgear fail past the point of repair. The probability of this happening is low but worrisome, and staff has found a way to address this vulnerability within the next year or so.

ANALYSIS

Staff can reduce Golden State�s vulnerability next year, FY 2007/08, by creating a path that bypasses the existing switchgear. Unlike most of BWP�s substations, Golden State has no direct connection between the low side of the power transformers and the transfer buss in case the operating buss fails. (The transfer buss at Golden State is well away from the switchgear, which contains the operating buss.) In the event of a major failure of the operating buss, such a direct connection would enable restoration of service within a much shorter time as compared to the October 2005 outages.

From an engineering point of view, the best way to provide the direct connection would be to completely replace Golden State�s existing switchgear with one that includes a direct connection from the transfer buss to the power transformers (double-buss, double-breaker scheme). But this means first transferring elsewhere Golden State�s entire load; and the only practical means of doing this would be to first build a new facility, Empire Station. So, it isn�t until FY 2013/14 that BWP�s 20-year Capital Improvement Plan calls for replacing Golden State switchgear.

Staff no longer believes it is prudent to wait six years, but sought a solution for next year that would not require the costly acceleration of several major capital improvements, including the construction of Empire Station. With the help of Power Engineers, Inc. (Power Engineers), staff has identified an underground path that would provide a direct connection between the transformers and transfer buss, bypassing the existing operating buss switchgear and leaving it in place. BWP can make this direct connection without having to transfer load or take customers out of service.

BWP also plans to add a capacitor bank at Golden State to improve its ability to supply proper voltages during peak loads.  In FY 2008/09, BWP had planned to add a capacitor bank at Golden State (9.0 MVAR, three steps of 3.0 MVAR each) to prevent voltage sags under summer peak conditions. (Unlike most stations, Golden State does not have a capacitor bank; but it now has more than enough customer load to warrant one.) However, it now seems more logical to do this work in FY 2007/08, when BWP also hopes to establish the direct connection to the transfer buss.

The total cost is about $1,045,000. Power Engineers independently estimated that the installed cost of the direct connection and capacitor bank would be $1,045,000:

• The direct connection would be $586,000, plus a 10% contingency of $59,000, for a total of $645,000.

• The capacitor bank would be $364,000, plus a 10% contingency of $36,000, for a total of $400,000.

Power Engineers� estimates agree with staff�s estimates as well as the earlier costing of similar components for the Replacement Burbank Station. The lead time for capacitor banks, circuit breakers, and other parts is currently six months; the work itself should be completed within a year.

Staff believes a design-bid contract is an effective way to handle both capital improvement projects at Golden State next year. Both projects are very close to each other and involve considerable civil as well as electrical work. Close coordination and a single point of responsibility is staff�s best guarantee that both projects will be accomplished before the summer of 2008. 

The design-build project delivery method has become the accepted method for electrical utilities to construct electrical distributing stations, switching stations, generation plants, and for environmental retrofitting of older generation plants. 

There is a six-month lead time for capacitor banks, enclosed breaker cubicles with disconnects, controls, protection devices, and other equipment. The work itself could be completed in the following six months, taking into account the times when BWP may have to delay work until it can safely take equipment clearances.

Staff believes that it is in the City�s best interest to waive formal bidding and instead negotiate solely with ABB.  Several factors allow staff to arrive at a competitive price without resorting to a lengthy competitive bidding process:

• As mentioned earlier, the cost estimate of $1,045,000 is supported by an independent estimate from Power Engineers, and is consistent with the cost of similar components for the Replacement Burbank Station. This estimate offers a sound basis for negotiating a favorable design-build contract price; and it is unlikely a competitive bid would differ significantly from it.

• At slightly over a million dollars, the amount of work may not be large enough to even attract competitive design-build bids. (Consider that just putting together a competitive bid costs a firm $50,000 to $75,000.)

• ABB, which already has a presence in Burbank as the design-builder for the Replacement Burbank Station, is in an excellent position to do this work in FY 2007/08. As outlined in earlier reports to the BWP Board and Council, ABB has had an excellent track record and has emerged as the first choice in two highly competitive bids: in 2001 to build the Alan E. Capon Switching Station, and in late 2006 to build the Replacement Burbank Station.

• Successfully negotiating with ABB would pave the way to beginning design and procurement this spring, allowing the work at Golden State to be completed before the summer of 2008. The process of going out for competitive bids would take two months or more.

Along with BWP and the assistance of the City Attorney�s Office, Purchasing would be part of the negotiating team. If BWP could not reach an Agreement with ABB by April 15, 2007, then BWP would work with Purchasing to consider formal bidding or other options.

BWP�s capital budget can accommodate the work at Golden State. BWP will spend less on the Replacement Burbank Station than planned this year; any work at Golden State this year could be supported on a cash flow basis. Next year, the work at Golden State would be a separately identified item in BWP�s 2007/08 Capital Improvement Budget.  All CEQA and MOU requirements would be met before any work is started on this project.

FISCAL IMPACT

The fiscal impact is positive, in that making a modest improvement to Golden State now provides timely service reliability improvements for customers and related revenue reliability to the utility; additionally the proposed improvement forestalls costlier and more extensive capital improvements.

CONCLUSION

For all of the foregoing reasons, staff submits that a finding can be made under Charter Section 54 that it is in the best interest of the City to waive formal bidding and authorize direct negotiations with ABB for work at Golden State Distributing Station as provided in Charter

Section 54.  This action requires four affirmative votes of the Council

RECOMMENDATION

Staff recommends that the City Council accept staff�s recommendations to authorize Burbank Water and Power (BWP) to negotiate with ABB, Inc. (ABB) for a design-build contract at or below $1,045,000 to modify the Golden State Distributing Station within 12 months from the date of authorization by the City Council. 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 AUTHORIZING THE GENERAL MANAGER OF BURBANK WATER AND POWER TO NEGOTIATE PRICE, TERMS, AND CONDITIONS OF A DESIGN-BUILD AGREEMENT WITH ABB, INC. FOR THE GOLDEN STATE DISTRIBUTING STATION IN AN AMOUNT NOT-TO-EXCEED $1,045,000 AND FURTHER AUTHORIZING EXECUTION OF SAID AGREEMENT.

RED:GLS:DDB:jg

Attachment

c:         R. Morillo

            P. Herman attn. Kristy Shadle

            B. Liu

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