N-1Application 5/3/2010
14 passages
Tufts Cove 6 Waste Heat Recovery Project CI28098 Application for Authority to Overspend May 3,2010 - Enclosed, please find Nova Scotia Power Inc.'s (NSPI, Company) application for Authority to - 2 Overspend (ATO) the Tufts Cove 6 Waste Hea...
AI summary Nova Scotia Power Inc. (NSPI) has applied for Authority to Overspend (ATO) for the Tufts Cove 6 Waste Heat Recovery Project, citing increased infrastructure costs, generator complexity, and design changes. The project's capital expenditures are forecast to increase to $93 million, 10% higher than the 2008 approval.
Project Economic Analysis NSPI has updated the project economic analysis to incorporate the increased capital cost. The results are summarized in the table below and compared to the project benefits forecast in the original capital filing....
AI summary NSPI has updated the project economic analysis to reflect increased capital costs and a revised in-service date of December 2010. The analysis includes the NPV of the duct-firing option, incorporating benefits from a 2008 study by Hatch Ltd.
NPV Benefit TUC 6 without Duct Firing vs TUC 6 No (Strategist) ($M) NPV Benefit TUC 6 with Duct Firing (DF) vs DF TUC 6 without ($M) NPV Benefit Total Project ($M) May 2008 Filing 43.84 31.60 75.44 2010 Revision 37.70 29.49 67.19 The proje...
AI summary The project economics remain strong despite increased capital costs. The combined cycle component is expected to generate a positive NPV of $37.70 million, while adding the duct-fired component increases the NPV to $67.19 million.
The reductions in NPV from the original filing for the combined cycle component and for the duct-fired component reflect the increased capital costs and additional operating costs associated with the revised in-service date, offset in part...
AI summary The text discusses reduced net present value (NPV) from the original filing due to increased capital and operating costs from revised in-service dates, partially offset by tax savings from higher capital value.
Consistent with this directive, NSPI has sought to compile the necessary cost information and economic analysis support to allow the Board to approve the enclosed ATO. The Company respectfully suggests the Board seek written input from the...
AI summary NSPI has compiled cost information and economic analysis to support the Board's approval of the enclosed ATO. The document includes details about changes in turbine systems, increased costs due to design modifications, and the selection of more expensive pump models for improved performance and reduced maintenance.
Cumulative NPV Costs 2006-2029 Year Operating Costs TUC 6 No Duct Firing In-Service June/2010 (K$) Operating Costs No TUC 6 (K$) Operating Costs Nominal $ (K$) Operating Cumulative PV Costs (K$) Year Capital Costs TUC 6 No Duct Firing In-S...
AI summary The document presents a detailed table of cumulative net present value (NPV) costs from 2006 to 2029, comparing operating and capital costs for two scenarios: TUC 6 No Duct Firing and No TUC 6. The table includes yearly operating and capital costs, cumulative present value costs, and total benefits in present value terms. The discount rate used is 6.62%.
Assumptions: - 5%DSM & Rnew Plan - TUC 6 No Duct Firing - In-service June/2010 - Capital Cost $70,775M ($2008) TUC6 UNFIRED_$70.775_MAY15-08.SAV NPV = $12.477.446 M
AI summary The text outlines assumptions related to a 5% DSM & Rnew Plan, TUC6 with no duct firing, in-service date in June 2010, and a capital cost of $70,775M in 2008. It also references a file named TUC6 UNFIRED_$70.775_MAY15-08.SAV with an NPV of $12.477.446 M.
Assumptions: - 5%DSM & Rnew Plan - TUC 6 Duct Fired - In-service June/2010 - Capital Cost $84.3M ($2008) TUC6 DF_$84.3M_MAY15-08.SAV NPV = $12,479.524 M
AI summary The text outlines assumptions related to a 5% DSM & Rnew Plan, including a TUC 6 Duct Fired project with a capital cost of $84.3M, in-service date of June 2010, and an NPV calculation of $12,479.524 M.
Revised April/2010 - In-service Dec/2010 & Capital Cost $78M Capita I Cost $78M Year Operating Costs TUC 6 No Duct Firing In-Service Dec/2010 (K$) Operating Costs No TUC 6 (K$) Operating Costs Nominal $ (K$) Operating Cumulative PV Costs (...
AI summary The text presents a detailed table of operating and capital costs for a project in Nova Scotia from 2006 to 2014, with comparisons between scenarios involving TUC 6 No Duct Firing and No TUC 6. The table includes costs, benefits, and cumulative values over time, reflecting financial planning and evaluation for infrastructure.
Incremental NPV Benefit of TUC 6 Duct Fired - Operating Cost Benefits from Hatch Analysis Revised April/2010 - In-service • its from flaten Analysi Capital Cost = $93M Capital Cost = $78M Operating Operating Capital Costs Capital Costs Cap...
AI summary The document presents a table analyzing the incremental net present value (NPV) benefit of the TUC 6 Duct Fired project, focusing on operating cost benefits from Hatch Analysis. It compares capital costs and cumulative benefits over time, showing a net benefit in the early years but a decline in later years.
TUC6 UNFIRED_$78(Dec)_Apr16-10.SAV NPV = $12,483.585 M POVEI An Emera Company Y UARB APPRO VAL SHEET Capital Project / Authorization Head Office Use:
AI summary The text presents a financial calculation related to a transmission unit capacity (TUC6) project, with a net present value (NPV) of $12,483.585 million. It also includes a table with information about a capital project and authorization, though the details are not fully visible.
2010 04/08 Forecast Capital ltem Accounts Acct Actv Account Activity Forecast Amount Amount Variance 001 001 - T&D Regular Labour 159 0 159 001 001 - THERMAL Regular Labour - 89,387 0 89,387 001 001 - Regular Labour (No AO) 799,436 0 799,4...
AI summary The document presents a 2010 forecast for capital accounts, detailing various expenses such as labor, materials, consulting, and interest capitalized, with significant amounts allocated to consulting and materials. The forecast highlights variances between actual and projected amounts, but all variances are equal to the forecast amounts, indicating no deviation from the forecast.
Capital Item Accounts Acct Actv Account Activity Forecast Amount Amount Variance 012 085 012 - Materials 085 Design 2,000 0 2,000 021 085 021 - Telephones 085 Design 3,600 0 3,600 028 085 028 - Consulting 085 Design 316,107 0 316,107 041 0...
AI summary The document presents a detailed breakdown of capital item accounts, including various expenses such as materials, consulting, travel, and contracts related to design, commissioning, and field operations. All forecast amounts are listed with zero actual amounts and significant variances.
Why do this project this way? NSPI operates two LM6000 combustion turbines at its generating facility at Tufts Cove. Currently energy in the form of heat generated from the combustion process for these units is exhausted to the environment...
AI summary NSPI is converting its Tufts Cove combustion turbines to combined cycle operation to recover waste heat, which is economically and environmentally beneficial. Duct-firing is also being considered for additional cost savings and load-following generation support. The project, with cost centre 396 and project number S353, was approved on September 30, 2008, and a variance was filed on May 3, 2010.
N-3Redacted NSPI (NSUARB) IR-1 to IR-20 7/16/2010
16 passages
1 3 Reference Project Capital Costs. 4 5 a) Please confirm, or state why NSPI cannot confirm, that the original estimate for this project, without duct firing, as filed in September 2007 was $55.5 million and the present ATO request is for...
AI summary The text requests confirmation of capital cost estimates for a project, referencing original and current figures, and provides a response confirming the figures and outlining the project's cost history.
NON-CONFIDENTIAL 1 Request IR-2: 2 3 Reference project economic analysis. 4 5 a) Please confirm, or state why NSPI cannot confirm, that the project economic 6 analysis used for NSPI submissions in September 2007, May 2008, and the present...
AI summary NSPI is asked to confirm whether the same economic assumptions were used in various project analyses, including the 2007 Integrated Resources Plan and the May 2010 ATO application. NSPI confirms that assumptions remain consistent, except for an updated in-service date and increased capital costs, which affected operating costs in 2010.
NPV Benefit of TUC 6 No Duct Firing (Base Case Plan A with NPPH Biomass Project) 2009 IRP Update Assumptions with NPPH Biomass Project Capital Costs: osts: Operating Costs: Costs: Capital Cost $78M Total Base Case NPPH Biomass Base Case NP...
AI summary The document presents a Net Present Value (NPV) analysis of the TUC 6 No Duct Firing project in conjunction with the NPPH Biomass Project, comparing capital and operating costs over time. It includes cumulative costs and PV benefits, with a discount rate of 6.81%, and highlights the project's in-service date as December 2012.
Operating costs including fuel, purchased power and O&M. Capital Costs are the annual charges for the combination of alternatives added. Files: No TUC 6 Case NPH-BASE_NO TUC6_JUL12.SAV Planning NPV = $9,927,086 TUC 6 No Duct Firing NPPH-BA...
AI summary The text outlines operating costs, including fuel, purchased power, and O&M, and discusses capital costs related to annual charges for alternatives. It references planning NPV values for two scenarios: No TUC 6 Case and TUC 6 No Duct Firing, with corresponding file names and NPV figures.
Incremental NPV Benefit of TUC 6 Duct Fired - Operating Cost Benefits from Hatch Analysis (Base Case Plan A with NPPH Biomass Project) ase riali A Willi Nrrii Biolilass rioject ass riojecty Capital Cost = $93M Capital Cost = $78M Operating...
AI summary The document presents an analysis of the incremental net present value (NPV) benefits of the TUC 6 Duct Fired project, comparing operating cost benefits from Hatch Analysis under different scenarios, including the Base Case Plan A with the NPPH Biomass Project. The analysis spans from 2008 to 2032, showing varying capital and operating costs over time.
Capital Costs are the annual charges for the combination of alternatives from Strategist. Cumulative NPV Costs 2008-2035 Notes: TUC 6 No Duct Firing NPPH-HIGH_TUC6 UNFIRED_$78(DEC)_JUL13.SAV Planning NPV = $12,016,909
AI summary The text discusses capital costs associated with a project, referencing cumulative NPV costs from 2008 to 2035 and mentions specific planning NPV figures for a project named 'NPPH-HIGH_TUC6 UNFIRED'. It also includes references to figures and a file name.
NPV Benefit of TUC 6 No Duct Firing (High Load Plan E with NPPH Biomass Project) 2009 IRP Update Assumptions with NPPH Biomass Project Capital Costs: Operating Costs: Capital Cost $78M Total High Load NPPH Biomass High Load NPPH Biomass Cu...
AI summary This document presents a net present value (NPV) analysis comparing two scenarios for the TUC 6 No Duct Firing project with the NPPH Biomass Project. It details capital and operating costs, cumulative costs, and NPV calculations from 2008 to 2032, with a discount rate of 6.81%. The analysis shows varying benefits over time for each scenario.
Cumulative NPV Benefit 2008-2032 30.46 M$ Capital Costs are the annual charges for the combination of alternatives added. Files: No TUC 6 Case NPPH-HIGH_No TUC6_JUL13.SAV Planning NPV = $12,047,370
AI summary The text presents a cumulative NPV benefit of 30.46 M$ from 2008 to 2032 and mentions capital costs as annual charges for added alternatives. It also references a file related to a case without TUC 6 and includes a planning NPV value of $12,047,370.
Incremental NPV Benefit of TUC 6 Duct Fired - Operating Cost Benefits from Hatch Analysis (High Load Plan E with NPPH Biomass Project) Capital Cost = $93M Capital Cost = $78M Operating Operating High Load NPPH Biomass High Load NPPH Biomas...
AI summary This document presents a table analyzing the incremental Net Present Value (NPV) benefits of the TUC 6 Duct Fired project, comparing operating cost benefits and capital costs for two scenarios: with and without duct firing. The analysis spans from 2008 to 2032, showing operating cost savings and cumulative benefits over time.
Cumulative NPV Costs 2008-2035 Notes: 7505 20 0507 Incremental Benefit of TUC 6 Duct Firing vs No Duct Firing - Hatch Analysis The see the see the see the Updated Capital Costs $93M, DF @ $15M Cumulative PV Costs (M$) Year 6105 8202 <10> 9...
AI summary The text presents a comparison of cumulative NPV costs for two scenarios involving the TUC 6 Duct Firing and No Duct Firing options under the High Load Plan E with the NPPH Biomass project. The capital costs are estimated at $93M and $78M respectively, with the analysis based on data from 2008 to 2035.
NON-CONFIDENTIAL 1 Request IR-4: 2 3 How much of the ATO increased cost is due to NSPl's decision to include duct firing in the 4 project versus the base case project without duct firing? 5 6 Response IR-4: 7 8 $1,474,864 of the increased...
AI summary The response to Request IR-4 indicates that $1,474,864 of the increased cost in the ATO is due to the inclusion of duct firing in the project, while $7,225,000 is attributed to the base case project without duct firing. The response references Attachment 1, pages 1 to 3, of the May 3, 2010 TUC 6 Waste Heat Recovery Project - CI 28098 ATO.
2 Without Duct Firing $M With Duct Firing $M Total Project NPV Benefit $M Increased Capital Cost (4.28) (0.91) (5.19) Additional Operating Costs (5.47) (1.90) (7.37) Tax Savings 3.61 0.70 4.31 Change in Net Present Value (6.14) (2.11) (8.2...
AI summary The table presents a financial analysis comparing the net present value (NPV) benefits of a project with and without duct firing, showing increased capital and operating costs, tax savings, and a negative change in NPV.
NON-CONFIDENTIAL 1 Response IR-11: (cont'd) 2 3 c) The incremental investment has a payback of approximately 3.5-5.25 years.
AI summary The response discusses the payback period for an incremental investment, estimating it to be between 3.5 and 5.25 years.
REDACTED 1 Request IR-17: 2 3 Reference Capital Cost Breakdown Table 4 5 Generator Transformer, Cables, Protection and BOP Cables 6 7 a) NSPI states that cable costs have increased by $658,257. Is this increase due to the 8 cost from manuf...
AI summary NSPI explains an increase in cable costs of $658,257, attributing it to increased automation requiring more cabling for motorized valves and instrumentation. The original budget allowed for a smaller scope of electrical work, and the increase is based on contractor bid prices.
Request IR-19: 2 3 1 Reference Capital Cost Breakdown Table 4 5 Insurance, AFUDC, Duty and A/O 6 7 a) Please provide the cost estimate of each of the above items. Provide the amount included in the original estimate, the ATO, and the amoun...
AI summary The document requests a breakdown of capital costs, including insurance, AFUDC, duty, and A/O, and an explanation of how delayed spending affects AFUDC. The response refers to a table for detailed cost estimates.
Original Submission ATO Submission AFUDC Base Rate per month AFUDC AFUDC Base Rate per month AFUDC Month ($ 000s) (%) ($ 000s) ($ 000s) (%) ($ 000s) July-08 153 0.66 1 - - - August-08 306 0.66 2 - - - September-08 1,356 0.66 9 - - - Octobe...
AI summary The document discusses the use of contingency funds in the May 2008 estimate for a project and the current ATO estimate. It confirms that the contingency in the May 2008 estimate was fully used, resulting in zero contingency in the ATO estimate. The document also requests clarification on the accuracy of the estimates and the process for obtaining additional funds if needed.
N-7NSPI Reply Submission 8/6/2010
13 passages
August 6, 2010 Ms. Nancy McNeil Regulatory Affairs Officer/Clerk Nova Scotia Utility and Review Board 1601 Lower Water Street, 3 rd Floor Halifax, NS B3J 3S3 Re: Nova Scotia Power Inc. - TUC6 Waste Heat Recovery Project - CI 28098 - Author...
AI summary Nova Scotia Power Inc. (NSPI) submits a reply to its ATO application for the TUC6 Waste Heat Recovery Project, defending cost increases as either beneficial or due to unforeseen circumstances. NSPI asserts the project maintains customer benefits, with the Nova Scotia Department of Energy endorsing the application. Intervenors did not oppose full cost recovery.
NPV and 2010 Savings As previously stated in NSPI's May 3, 2010 application, the Project retains a very positive NPV which would not have changed the decision to proceed originally. The following factors led to the business decisions made...
AI summary NSPI's 2010 application highlights the project's positive NPV and factors supporting its continuation, including infrastructure requirements, schedule maintenance, and plant optimization for long-term low operating costs, emphasizing customer benefits.
2. Maintenance of the Project Schedule The original project schedule forecasting the June 2010 in-service date was affected by the steam turbine generator selection. NSPI originally anticipated that Board approval would be received in June...
AI summary Nova Scotia Power Inc. (NSPI) faced delays in procuring a steam turbine generator due to market conditions and design challenges. By securing a generator from Mitsubishi through strategic negotiations, NSPI maintained the project's 2010 in-service date, preserving customer benefits and NPV. The analysis notes limitations in wind integration benefit projections beyond 2020.
Circulating Water Pumps The development of the physical layout, while taking into consideration the steam turbine and condenser operating conditions, was being studied in concert with the circulating water pump selection. The pump supplier...
AI summary NSPI evaluated two circulating water pump sizes for a power plant, concluding that smaller pumps were not viable due to insufficient operating advantages over capital expenditures. The decision favored dividing the condenser waterbox instead of using smaller pumps, which failed to justify costs through power savings.
Boiler Feed Water Pumps The Boiler Feed Water (BFW) pump selection was affected by changes in the pump discharge pressure requirements as a result of finalizing the design and feedwater piping details of the once-through-steam-generator. E...
AI summary NSPI selected combination high/low pressure pumps for boiler feed water systems due to lower capital costs and long-term maintenance benefits. Automatic Recirculation Valves were rejected in favor of separately purchased motorized valves, aligning with utility standards and operational experience to ensure equipment reliability.
Operating Savings Resulting from Automation Incremental costs associated with the increased automation of the facility are offset by the ongoing operating costs which would otherwise be required to staff this facility. The economic effect...
AI summary NSPI argues that increased automation reduces staffing requirements, leading to cost savings and avoiding a project NPV deterioration of $2.3 million. Automation allows a smaller operating team, offsetting incremental capital expenditures with labour cost savings. The economic analysis is detailed in Attachment 2.
Contingency NSDOE, Avon, and NPB have each raised questions regarding the contingency amount of $7,213,207 which was included in the Board approved capital work order for this Project. Inclusion of a contingency amount in capital work orde...
AI summary NSDOE, Avon, and NPB question the $7.2M contingency in the Board-approved capital work order. The text defends contingency inclusion as standard practice for cost variances and clarifies NSPI's overspend does not exceed the ATO's $8.7M request. NSPI confirms no unallocated contingency exists in the ATO.
Conclusion The evidence available to the Board in this application demonstrates that the steps taken by NSPI during planning and construction of this Project were reasonable, prudent and led to significant preservation of value for NSPI cu...
AI summary The evidence shows that NSPI's actions during the planning and construction of the Project were reasonable and prudent, benefiting customers. The ATO application for TUC6 is deemed the best economic option, with cost increases due to unforeseen factors. NSPI requests approval of the ATO for CI 28098.
NOTE: Operating Costs include fuel, variable O&M, net transaction costs and fixed thermal and hydro O&M costs Capital Charges are the annual charges for the combination of alternatives added. Assumptions: - 5%DSM & Rnew Plan - No TUC 6 5%D...
AI summary The text discusses operating costs, including fuel and O&M expenses, and capital charges related to a 5% DSM & Rnew Plan. Two scenarios are outlined: one without TUC6 and another with TUC6 but no duct firing, each with associated NPV figures and capital costs.
Incremental NPV Benefit of TUC 6 Duct Fired - Operating Cost Benefits from Hatch Analysis May 2008 Filing with In-service date changed to Nov/2011 (was Jun/2010) Capital Cost $84.3M Capital Cost $70.775M Operating Operating Capital Costs C...
AI summary The document presents a financial analysis of the incremental net present value (NPV) benefit of the TUC 6 Duct Fired project, comparing operating costs and capital expenditures from 2006 to 2029. The in-service date was updated from June 2010 to November 2011, and the analysis shows a cumulative NPV cost of 25.65 M$ over the period with a discount rate of 6.62%.
Operating Cost Benefits - Hatch Analysis (difference in system operating costs with TUC 6 at 125MW and 150MW) - Hatch benefits calculated for 2011 reduced to include only 2 months of benefits because TUC 6 for this analysis is in-service N...
AI summary The document discusses the operating cost benefits and capital costs associated with TUC 6 at different capacities (125MW and 150MW), including assumptions about in-service dates, DSM plans, and duct firing. It also presents NPV calculations for both duct fired and no duct firing scenarios, highlighting the impact of revised capital costs on operating expenses.
Capital Cost $78M Capital Cost $76.44M Capital Costs Difference Nominal $ (K$) 0 0 0 0 90 -225 -218 -214 -208 -203 -197 -192 -187 -181 -176 -170 -164 -159 -153 -147 -142 -136 -130 -124 -1,457.1 %) (Discount Rate is 6.62 Reduced capital - n...
AI summary The text presents capital cost differences and operating costs for a project, including a nominal difference of -1,457.1 K$ and a discount rate of 6.62%. It details capital costs for TUC 6 No Duct Firing and operating costs for 5 power engineers, which include an incremental increase of $3.72M.
- Capital Cost reduction of $1.56M for no remote control equipment reduced capital costs by $1.46M over the period 2006-2029. - Incremental increase if there is additional staffing required = $2.26M.
AI summary The text discusses capital cost reductions and potential incremental increases due to staffing requirements. A reduction of $1.56M in capital costs is attributed to the absence of remote control equipment, while an additional $2.26M may be needed if more staffing is required.
05797Board Decision
8 passages
[2] NSPI stated: ... The forecast cost increase is associated with changes to specific project cost elements unforeseen at the time of NSPl's original capital filing with the Nova Scotia Utility and Review Board (UARB, Board). [Exhibit N-1...
AI summary NSPI submitted a work order for the Tufts Cove 6 Waste Heat Recovery Project in 2007, requesting approval to recover costs from customers. The Board requested clarification on the project's cost recovery and stakeholder engagement. George Cooper, acting on behalf of Stora Enso and Bowater Mersey Paper, urged the Board to establish a public process for stakeholder input.
Description May/OS May/10 Variance Harbour Infill, Site Prep and Foundations $ 3.82 $ 7.86 $ 4.04 Environmental Assessment and Permits $ 0.64 $ 0.67 $ 0.03 Buildings and Auxiliary Systems $ 3.40 $ 5.03 $ 1.63 Steam Turbine Generator and Ma...
AI summary The text presents a table comparing costs for various project components in May/OS and May/10, showing significant variances. The largest increases were in Harbour Infill, Steam Turbine Generator, and Engineering Design, Procurement and Commissioning. NSPl attributes these increases to unforeseen changes in specific cost elements not previously accounted for in earlier filings with the Board.
ount of automation and controls. Everyone of those requires a device change, so you're automating the piece of equipment instead of it being a manual operation with a valve which is the easiest one to explain. You're essentially taking awa...
AI summary The discussion centers on automation upgrades in a steam plant, which required significant capital investment but reduced the need for manual operations and staff. The automation changes involved adding controlled devices, cabling, and design modifications, leading to a reduction in FTE requirements and an increase in the project's net present value.
rrectly, what you're really saying to the Board is that the reference plan is too conservative. You think this plant will run, certainly in the near term, at a much higher capacity factor than implied by the reference plan, which is why we...
AI summary The discussion centers on the underestimation of flexibility in capital projects, particularly natural gas-fired plants, leading to a negative NPV. The speaker argues that the reference plan is too conservative and that the current methodology fails to account for the value of flexibility, as seen in past projects like Tufts Cove.
the Company bears the responsibility of that diligence. Ratepayers should not be exposed to financial risk they cannot control, certainly never to the point where a project no longer has positive NPV. Scrutiny by Board staff, consultants a...
AI summary The Company is held responsible for ensuring project diligence and managing financial risks, particularly regarding capital work orders and cost overruns. Ratepayers should not bear uncontrolled financial risks, and the Company must ensure projects maintain positive NPV. Concerns were raised about increasing project costs and the adequacy of engineering design.
[52] When questioned by the Board on this issue, Mr. Janega said: ... 1can assure you that Nova Scotia Power's track record on implementing projects on time, and on budget, is a key measure of ours. Internally, it's something that we take...
AI summary Mr. Janega emphasizes Nova Scotia Power's commitment to managing projects on time and within budget, noting that internal scrutiny and additional oversight were implemented to address challenges on the Tufts Cove 6 Waste Heat Recovery Project.
V FINDINGS [53] This Project has seen an extraordinary increase in capital costs. The 2007 estimate vvith duct firing \AJas $66.3 million. In ~Aay 2008 it had increased to $84,3 million and the present ATO is $93.0 million. NSPI states tha...
AI summary The project has experienced a significant increase in capital costs, from an initial estimate of $66.3 million in 2007 to $93.0 million. NSPI attributes the increase to unforeseen changes during the design process, while the Board is concerned about the level of planning and design. The contingency fund was fully used, and an additional increase is now requested.
VI CONCLUSION - [71] Consequently, the Board approves this ATO request in the amount of $8,699,864, for a total Project cost of $92,996,628. - [72] An Order will issue accordingly. DATED at Halifax, Nova Scotia, this 22nd day of November,...
AI summary The Board approves an ATO request of $8,699,864, bringing the total project cost to $92,996,628. An Order will be issued to formalize this approval, dated November 22, 2010.
04691Information Request IR-1 to IR-20 issued by Board Staff to NSPI 6/30/2010
5 passages
Request IR-1: 1 - 2 Reference Project Capita! Costs. - a. Please confirm, or state why NSPI cannot confirm, that the original estimate for this project, without duct firing, as filed in September 2007 was $55.5 million and the present ATO...
AI summary The request seeks confirmation of original project cost estimates from 2007 and the current ATO request amounts, highlighting a significant increase in costs. The original estimates were $55.5M and $66.3M, with current requests at $78M and $93M, representing 40.5% and 40.3% increases, respectively.
Request IR-5: Reference Pages 2 and 3 of the May 3, 2010 ATO. a. Please confirm that, as stated in the first paragraph on page 2, the cost increases are due to "..changes to specific project cost elements unforseen at the time of NSPI's or...
AI summary The document outlines several requests for clarification regarding the May 3, 2010 ATO and ATD filings by NSPI. The requests pertain to cost increases, assumptions, project changes, and the impact on NPV. The focus is on verifying the original capital filing, identifying assumptions, and quantifying the financial impacts of specific project changes.
c. Please quantify these additional benefits. 1 Request IR-9: 22 the changes that resulted in the design change for this project. 23 c. When did NSPI become aware of the change in design code? 24 25 Request IR-11: 26 Reference Capital Cost...
AI summary The text contains a series of requests related to quantifying benefits, changes in design, and capital costs for a project managed by NSPI. It includes inquiries about awareness of design code changes, operational cost impacts, and justifications for increased capital expenditures.
28 29 2 Reference Capital Cost Breakdown Table 3 Steam Turbine Generator and Major Components 4 Electrical Switchgear, etc 5 a. NSPI states that this increase of $1,557,284 is due to "increased automation". 6 Please explain why there is a...
AI summary The text presents a series of requests for clarification regarding capital cost increases related to a steam turbine generator, electrical switchgear, and other components. The requests focus on the reasons for increased automation, the breakdown of cost increases, and the economic justification for additional spending.
Request IR-16: 1 changes and what due to "underestimating the complexity of the combined cycle 2 process"? 3 c. Please explain why NSPI used a controls consultant that was not aware of the 4 "complexity of the combined cycle process" and w...
AI summary The text is a request (IR-16) asking Nova Scotia Power Inc. (NSPI) to explain various cost increases related to a combined cycle process, including the use of a controls consultant, commissioning costs, and the overall increase in Engineering Design, Procurement, and Commissioning costs.
05797Board Decision
10 passages
IN THE MATTER OF THE PUBLIC UTILITIES ACT - and- I"'~ THE MATTER OF A"'~ APPLICATION by Nova Scotia Power Incorporated for Authority to Overspend (ATO) - TUC6 Waste Heat Recovery Project - CI#28098 BEFORE: Roberta J. Clarke, a.c., Member C...
AI summary Nova Scotia Power Incorporated applied for authority to overspend on the TUC6 Waste Heat Recovery Project. The application was approved by the board on November 22, 2010, following a hearing on October 22, 2010.
[2] NSPI stated: ... The forecast cost increase is associated with changes to specific project cost elements unforeseen at the time of NSPl's original capital filing with the Nova Scotia Utility and Review Board (UARB, Board). [Exhibit N-1...
AI summary NSPI submitted a work order for the Tufts Cove 6 Waste Heat Recovery Project in 2007, requesting approval to recover costs from customers. The Board requested stakeholder input on the project's necessity, cost reasonableness, and benefits to customers.
III EVIDENCE - [16] As noted in the Board's December 21, 2007 letter to NSPI, Tufts Cove 4 and 5 are simple cycle LM6000 combustion turbines installed in July 2003 and January 2005 respectively. Both units are rated at 50 MW and are fuelle...
AI summary The document discusses the TUC6 Waste Heat Recovery Project by NSPI, including its technical design, economic analysis, and progress updates. The project involves recovering waste heat from gas turbines to increase efficiency and output, with updated capital costs and in-service dates. NSPI confirms that the economic assumptions remain consistent with previous analyses and the 2007 Integrated Resource Plan.
Description May/OS May/10 Variance Harbour Infill, Site Prep and Foundations $ 3.82 $ 7.86 $ 4.04 Environmental Assessment and Permits $ 0.64 $ 0.67 $ 0.03 Buildings and Auxiliary Systems $ 3.40 $ 5.03 $ 1.63 Steam Turbine Generator and Ma...
AI summary The document outlines cost variances in a project, with the largest increases attributed to Harbour Infill, Site Preparation and Foundations, Steam Turbine Generator and Major Components, and Engineering Design, Procurement and Commissioning. NSPI explains these increases were due to unforeseen changes in specific cost elements not accounted for in earlier filings with the Board.
ount of automation and controls. Everyone of those requires a device change, so you're automating the piece of equipment instead of it being a manual operation with a valve which is the easiest one to explain. You're essentially taking awa...
AI summary The discussion outlines the automation upgrades at a steam plant, which required replacing manual devices with automated ones, leading to a reduction in staffing needs. This change involved capital expenditures but resulted in operating savings. The project's complexity increased, requiring more commissioning and start-up staff due to the lack of similar plants for reference.
rrectly, what you're really saying to the Board is that the reference plan is too conservative. You think this plant will run, certainly in the near term, at a much higher capacity factor than implied by the reference plan, which is why we...
AI summary The discussion centers on the underestimation of flexibility in capital projects, particularly in natural gas-fired plants, which may lead to inaccurate NPV calculations. The speaker argues that the reference plan is too conservative and that flexibility should be valued more highly, citing past projects like Tufts Cove as examples where flexibility exceeded expectations.
the Company bears the responsibility of that diligence. Ratepayers should not be exposed to financial risk they cannot control, certainly never to the point where a project no longer has positive NPV. Scrutiny by Board staff, consultants a...
AI summary The Company is responsible for ensuring project diligence and managing financial risks, particularly regarding capital work orders. Ratepayers should not bear the risk of cost overruns unless beyond the Company's control. Concerns were raised about significant cost increases and changes in engineering design for the Tufts Cove 6 Waste Heat Recovery Project.
[52] When questioned by the Board on this issue, Mr. Janega said: ... 1can assure you that Nova Scotia Power's track record on implementing projects on time, and on budget, is a key measure of ours. Internally, it's something that we take...
AI summary Mr. Janega assures the Board that Nova Scotia Power has a strong track record in managing projects on time and within budget, and emphasizes that internal scrutiny and additional oversight were implemented to address challenges faced on a specific project.
V FINDINGS [53] This Project has seen an extraordinary increase in capital costs. The 2007 estimate vvith duct firing \AJas $66.3 million. In ~Aay 2008 it had increased to $84,3 million and the present ATO is $93.0 million. NSPI states tha...
AI summary The project's capital costs have increased significantly from $66.3 million in 2007 to $93.0 million due to changes in design, environmental permits, and code changes. The Board is concerned about the level of planning and design, as the contingency fund was fully used and further increases are requested.
VI CONCLUSION - [71] Consequently, the Board approves this ATO request in the amount of $8,699,864, for a total Project cost of $92,996,628. - [72] An Order will issue accordingly. DATED at Halifax, Nova Scotia, this 22nd day of November,...
AI summary The Board approves an ATO request of $8,699,864, bringing the total project cost to $92,996,628. An order will be issued in accordance with this approval.