FORMCM-36 CITY OF GLENDALE CALIFORNIA REPORT TO CITY COUNCIL October 2. 2007 AGENDA ITEM Report: Request for Proposal (RFP) for the Major Overhaul of the Steam Turbine-Generator of Grayson Unit NO.2 1. Authorization for City Council to approve a resolution ofappropriation to budget funds for the Unit No.2 steam turbine-generator overhaul 2. Resolution authorizing City Council to adopt a Request for Proposal (RFP) for the Unit No.2 steam turbine-generator overhaul COUNCIL ACTION Public Hearing r I 1, Ordinance [ ] Consent Calendar [X] Action Item [ ] Report Only [ ] Approved for _October 2. 2007 calendar ADMINISTRATIVE ACTION Submitted Daniel W. Waters, Interim Director ofglendale Water & Pow ~ /1/-'V7'Jbt"---ff-;'--FH7A"I----- Prepared Ned Bassin, Power Management Administrator "',.'-.L-L~'---'~~=--=-=-"'= Gil Espinosa, Sr. Mechanical Engineer ~~~~~~~_ Camilo A. Ruiz, Mechanical Engineering Associate Approved James E. Starbird, City Manager Reviewed Scott Howard, City Attorney '.~~~~~~~~ ~~~~-+---_-+----+-~,,;.,,.~~~;'!,A.,!~~~_!:.d-- Michael Pease, Finance and Administrative Services. --::::'---------'----- ----t:::
Approval to Issue RFP for Major Overhaul ofgrayson Unit No.2 September 25,2007 Page 2 of3 RECOMMENDATION It is recommended that the City Council approve the attached Resolution adopting a Request for Proposal (RFP) for the Unit No.2 steam turbine-generator overhaul, and that the Interim Director of Glendale Water & Power be instructed to solicit the RFP. The specifications are on file and available in the GWP administration office. Furthermore, it is recommended that the City Council approve a Resolution ofappropriation to budget funds for the Unit No.2 steam turbine-generator overhaul. SUMMARY The Grayson Unit No.2 steam turbine-generator has about 93,000 operating hours since its last major inspection and overhaul. The recommended major overhaul interval is 50,000 hours. Due to the volume ofwork, the overhaul was scheduled for FY 2008-2009, but there is now an opportunity to perform the overhaul a year earlier and in time for full operation during the summer of2008. This project is exempt under the California Environmental Quality Act. FISCAL IMPACT The overhaul ofthe Grayson Unit No.2 steam turbine-generator was scheduled to be performed during the winter of2008, for which funds of$2,050,000 would have been requested under FY 2008-2009. However, there is both a need and an opportunity to perform the work in early 2008. Consequently, we are requesting an appropriation of $2,050,000 in the FY 2007-2008 budget under Account 43111 (Fund No. 553, Organization No. 921), Project No. 12522 (Capital hnprovement Project), and Activity No. UPOlO to perform the overhaul before the summer of2008. BACKGROUND The Unit No.2 steam turbine-generator had its last major inspection and overhaul in 1995 and has now accumulated 93,000 operating hours. It is typical practice in the industry to perform major inspections and overhauls of large steam turbines after approximately 50,000 hours of operation. However, during the California experiment on electric deregulation, GWP deferred the cycle ofconducting major overhaul on its units, pending the study on the fate ofthe Grayson Power Plant. With the City's resolve to keep the Grayson Plant rather than abandon its local generation and recoup its stranded assets, GWP replaced its old simple cycle gas turbine (Unit Nos. 6 and 7) with the new state-of-the art GE LM 6000 unit, and later commenced with the cycle ofoverhauling the steam turbine units. At the time, steam turbine Unit Nos. 2, 4 and 5 all had approximately 60,000 hours of operation and were all overdue for overhauls.
Approval to Issue RFP for Major Overhaul ofgrayson Unit No.2 September 25, 2007 Page 3 of3 Overhauls and major repairs were scheduled to be performed sequentially and as soon as possible given the need to prepare detailed specifications, perform other outage related maintenance, and maintain GPP operation capability. The overhaul ofthe Unit No.2 steam turbine-generator was scheduled for FY 2008-2009 to follow the scheduled overhauls Unit Nos. 4 and 5 steam turbines, and the rewind ofthe Unit No.4 generator. The work for Unit Nos. 4 and 5 have been completed, and the rewind ofthe Unit No.4 generator was completed earlier in the fiscal year. than originally scheduled, providing an opportunity to perform the Unit NO.2 overhaul in FY 2007-2008. With 93,000 operating hours since its last major overhaul, it is highly desirable to perform the overhaul on Unit No.2 this fiscal year. Unit No.2 is part ofa combined cycle system providing some ofgrayson Power Plant's most efficient generation, and performing the overhaul this fiscal year will minimize the risk ofloss ofthe unit during the summer of2008. These inspections and overhauls usually take eight to twelve weeks, during which time the steam turbine is unavailable for service. The scope ofwork for the inspection and overhaul consists of the following four phases: 1. Disassembly and detailed inspection 2. Repair and replacement ofitems identified during previous inspections, or otherwise known to require repair 3. Repair replacement ofitems identified during this inspection that need to be replaced to ensure reliable operation until the next planned inspection and repair (approximately 50,000 hours ofoperation) 4. Reassembly and testing to return the steam turbine to service The RFP is structured such that contractors will submit proposals ofeach ofthe four phases. The City will reserve the right in the Request for Proposal to award phases separately, or to terminate the contract at the conclusion on any phase. The third phase involves the repair items that are as yet unknown and will be identified during the first phase, inspection. Therefore, once the inspection report is prepared and necessary repair work identified, the City can determine whether it is in its best interest to award the identified repairs to the same contractor who performs the inspections, or to re-bid that work. The contractors' proposals will be guided by the inspection and overhaul report that Glendale had prepared during the last overhaul. Although the steam turbine generator has not shown any operational malfunctions, repair decisions were made during the last overhaul with the anticipation that another inspection and repair would be performed after approximately 50,000 hours ofoperation. GWP recommends that the above approach for overhaul ofunit No.2 be consistent with the procedure performed successfully, as with the completion ofunit No. 5 last year, and the completion ofunit No.4 this summer. EXHIBIT(S) (N/A)
RESOLUTION NO. _ RESOLUTION OF THE COUNCIL OF THE CITY OF GLENDALE MAKING AN APPROPRIATION BE IT RESOLVED BY THE COUNCIL OF THE CITY OF GLENDALE: SECTION 1: That the sum of $2,050,000 is hereby appropriated and transferred from the following accounts: ACCOUNTS 27900-553 43111-553-921-12522 UPOlO DESCRIPTON Net Assets, Electric Depreciation Fund Construction Services, Electric Depreciation Fund, Power Management FROM $2,050,000 TO $2,050,000 To appropriate funds for the Major Overhaul of the Steam Turbine Generator for Grayson Unit No. 2. SECTION 2: The shall certify to the adoption ofthis Resolution. Adopted this day of, 2007. ATTEST: STATEOFCALIFORNIA ) COUNTY OF LOS ANGELES ) SS CITY OF GLENDALE ) I, Ardashes Kassakhian, ofthe City of Glendale, certify that the foregoing Resolution No. was adopted by the Council of the City of Glendale, California, at a regular meeting held on the day of, 2007 and that the same was adopted by the following vote: Ayes: Noes: Absent: 6 E.l
RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GLENDALE ADOPTING GLENDALE WATER & POWER REQUEST FOR PROPOSALS FOR THE OVERHAUL OF GRAYSON UNIT NO.2 AND DIRECTING THE DIRECTOR OF GLENDALE WATER & POWER TO ADVERTISE FOR PROPOSALS BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF GLENDALE: SECTION 1. The request for proposals, on file in the Office ofthe Director ofglendale Water & Power, for the Grayson Unit No.2 steam turbine-generator overhaul, including the various documents incorporated therein, are hereby approved and adopted. SECTION 2. The Director ofglendale Water & Power is hereby directed to advertise for proposals for the work, equipment and materials described in the request for proposals adopted by this resolution. Adopted this day of :, 2007. ATTEST: Mayor STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) CITY OF GLENDALE ) I, ARDASHES KASSAKHIAN, ofthe City ofglendale, do hereby certify that the foregoing Resolution No. was duly adopted by the Council ofthe City of Glendale, California, at a regular meeting held on the day of, 2007, and the same was adopted by the following vote: Ayes: Noes: Absent: Abstain: 6 /E 2