N-1Application 5/3/2010
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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 $93 million, 10% higher than the 2008 approval.
NPV Benefit TUC 6 without Duct Firing vs TUC 6 No (Strategist) ($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.
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 is requesting the Board to seek written input from original participants in CI 28098 regarding the Tufts Cove 6 project. The project's justification remains unchanged since 2008, and it is expected to deliver significant savings, system stability, support for renewable energy, and environmental benefits. Cost increases are attributed to unforeseen cost drivers.
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 NPV Benefit of TUC 6 No Duct Firing Cumulative NPV Costs 2006-2029
AI summary The text outlines assumptions related to a project involving a 5% DSM & Rnew Plan, TUC 6 No Duct Firing, with a capital cost of $70.775M in 2008. It includes an NPV calculation of $12,477.446M and a cumulative NPV cost analysis from 2006 to 2029.
N-3Redacted NSPI (NSUARB) IR-1 to IR-20 7/16/2010
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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.
NON-CONFIDENTIAL 1 Additional operating benefits derived from these increases in cost are not reflected in the 2 variance analysis, or the project economics. 3 Date Filed: July 15, 2010 NSPI (UARB) IR-2 Page 2 of 6
AI summary The text indicates that additional operating benefits from increased costs are not reflected in the variance analysis or project economics, as noted in a document filed by NSPI on July 15, 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.
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.
2 Without Duct Firing $M With Duct Firing $M Total Project NPV Benefit $M Increased Capital Cost (4.28) (0.91) (5.19) Additional Operating Costs (5.47) (1.90) (7.37) Tax Savings 3.61 0.70 4.31 Change in Net Present Value (6.14) (2.11) (8.2...
AI summary The table presents a financial analysis comparing the net present value (NPV) benefits of a project with and without duct firing, showing increased capital and operating costs, tax savings, and a negative change in NPV.
NON-CONFIDENTIAL 1 Response IR-11: (cont'd) 2 3 c) The incremental investment has a payback of approximately 3.5-5.25 years.
AI summary The response discusses the payback period for an incremental investment, estimating it to be between 3.5 and 5.25 years.
Original Submission ATO Submission AFUDC Base Rate per month AFUDC AFUDC Base Rate per month AFUDC Month ($ 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
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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.
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.
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.
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 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
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nditure; the reasonableness and transparency of the costs involved; and the resulting benefit to customers of NSPI as a result of the proposed project." [Board Letter to NSPI, December 21,2007, p. 1] - [4] The amount approved by the Board...
AI summary The Board approved a capital expenditure of $55.5 million for the combined cycle component of the Tufts Cove 6 Waste Heat Recovery Project in 2007. In 2008, NSPI requested approval for a revised cost of $84.3 million, which the Board approved after public comment, emphasizing that the project must be completed at or below the approved cost.
the Generating Station to residences. In response to Board IR-13b, NSPI explained that a by-pass system was required to eliminate extended use of atmospheric vents during "hot" starts. NSPI said that: - b) ... Minimizing the use of vents i...
AI summary NSPI explained the need for a bypass system to reduce noise from atmospheric vents during hot starts at Tufts Cove Generating Station. Increased automation led to higher costs and changes in plant design, including condenser modifications and larger cooling water pumps. NSPI provided an economic analysis showing a net present value benefit of $2.3 million from automation.
[41] Avon stated: The issue for the Board in considering this ATO is whether the Project continues to be economically justified and in the best interest of ratepayers and, in addition, whether NSPI has managed the Project to the lowest rea...
AI summary Avon questions the economic justification and cost management of the Tufts Cove 6 Waste Heat Recovery Project, arguing that costs were not prudently incurred and suggesting shareholders should bear some increased costs. NSDOE does not find evidence of imprudence, while MEUNSC emphasizes the responsibility of the company to manage project costs and protect ratepayers from financial risk.
04691Information Request IR-1 to IR-20 issued by Board Staff to NSPI 6/30/2010
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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-2: Reference project economic analysis. - a. Please confirm, or state why NSPI cannot confirm, that the project economic analysis used for NSPI submissions in September 2007, May 2008, and the present ATO application all use the...
AI summary Request IR-2 seeks confirmation from NSPI regarding consistency in assumptions across multiple project economic analyses (2007, 2008, and current ATO application), specifically fuel costs and operating costs, and requests an updated analysis incorporating latest inputs and Hatch benefits.
Request IR-4: How much of the ATO increased cost is due to NSPl's decision to include duct firing in the project versus the base case project without duct firing? Date Filed: June 30, 2010
AI summary The document requests an analysis of the ATO increased cost attributable to NSPI's inclusion of duct firing in the project versus the base case scenario, filed on June 30, 2010.
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: 30 in the original cost estimate. 31 f. Please provide the estimated operating cost saving due to this design change. 1 Request IR-14: 2 Reference Capital Cost Breakdown Table 3...
AI summary The text contains a series of requests related to quantifying benefits, operating cost savings, and economic analyses of design changes and capital expenditures. Questions focus on cooling loads, pump models, maintenance costs, and NPV economic analysis for capital 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.