HomeMy WebLinkAbout8 Consideration for Procurement of Replacement Water Meter MTUsr....... ..... .
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RUCKEE DONNER Utility District
CONSENT
To:
Board of Directors
From:
Neil Kaufman
Date:
April 15, 2020
Subject: Consideration for Approval of the Procurement of Replacement
Water Meter Radio Transmitters
1. WHY THIS MATTER IS BEFORE THE BOARD
Board authorization is required for expenditures in excess of $15,000.
2. HISTORY
In September 2008, the District awarded a contract for the provision of an automated meter
reading (AMR) system to cover all water customers. That system utilizes water meters
manufactured by the Neptune Technology Group in conjunction with a radio system and
software by Aclara.
The radio system consists of three main components:
• Meter Transmitter Units (MTUs);
• Distributed Collection Units (DCUs); and
• Network Control Computer (NCC).
Each water meter is equipped with an MTU. At a given interval, the MTU reads the meter and
transmits the meter reading. The first generation MTUs captured meter readings every six
hours. About three years ago, the District started using an updated MTU that is capable of
capturing meter readings on an hourly basis. This updated MTU is used for new construction
and maintenance replacements. The District did not conduct a system wide replacement of
old MTUs that were functioning properly. The MTUs are battery powered and factory sealed.
When a battery fails, the entire MTU must be replaced. Currently, there are over 13,000
MTUs in the system.
There is a network of 27 DCUs located throughout the District at a mixture of water storage
tanks, pump station buildings and dedicated utility poles. These DCUs receive the radio
transmissions from the MTUs. The data is then stored and transmitted back to the District
office once a day.
The NCC is located at the District office. It receives the meter data and stores it in a
database. Other District functions such as billing and customer service access the database
as needed.
The great majority of the MTUs were installed in 2009 and 2010 as part of the original
deployment of the AMR system. These MTUs have a 20 year battery warranty from the
manufacturer. For MTUs that fail within the first 10 years, a replacement MTU is provided at
no cost of the District. For years 11 to 20, the cost of a replacement MTU starts at 50% cost
and is then pro -rated at 5% per year. For an MTU that failed in year 11, the District would pay
55% of the replacement cost. For an MTU that failed in year 15, the District would pay 75% of
the replacement cost. The MTU replacement warranty only covers the MTU and does not
cover the labor associated with replacing the MTU. Please note that the warranty
replacement proration costs that were presented in July 2019 were incorrect. The information
presented here has been verified with Aclara and the original purchase documents from 2008.
As discussed at the July 17, 2019 Board Meeting, the District had been experiencing a
significant number of MTU failures. The cause of the failures is believed to be a combination
of the temperature variations that are experienced in Truckee along with some overly -
optimistic projections regarding the battery life from the manufacturer.
At that time, the District had identified about 3,100 MTUs that required replacement. All of
these MTUs were within the first ten years of service and the replacement MTUs were
acquired from Aclara under the warranty at no cost. A contract to perform the field installation
of those replacement MTUs was awarded to Concord Utility Services and completed in
November 2019. It was also noted that the Water Department expected a significant number
of MTU failures over the winter of 2019-2020.
3. NEW INFORMATION
There are about 4,800 MTUs remaining from the original deployment in 2009 and 2010. Of
that total, about 2,600 MTUs are completely dead and not functioning. There are additional
250 MTUs that were installed in later years that are completely dead and not functioning. All
of these units require immediate replacement. There are an additional 600 MTUs with low
battery voltage that will likely die before sometime this summer or fall. Of this amount, 450
were originally installed in 2009 and 2010.
There are an additional 1,350 units from the original deployment that are functioning properly.
Given the District's experience to date, it is expected that these units will fail sometime next
winter and the Water Department would like to replace these units proactively. It is
anticipated that this additional replacement would allow the District to manage the future
failures with internal staff.
The Water Department has been discussing the issue of replacement MTUs with Aclara for a
few months. We have gotten a commitment from Aclara to deliver the replacement MTUs in
June 2020. The District's prorated cost share for the MTUs that have failed in year 11 is
$49.50 each. Given the nature and prevalence of the premature failures, Aclara has agreed
to a discounted price for the additional replacement MTUs. The table below summarizes the
expected cost for the MTUs.
MTUs w/ Dead Battery - Full Warranty
1,450
$ -
$ -
MTUs w/ Dead Battery - Pro -Rated Warranty
1,400
$ 49.50
$ 69,300.00
MTUs w/ Low Battery Life
1,600
$ 75.00
$120,000.00
Additional MTUs to be Replaced
600
$ 75.00
$ 45,000.00
Total
4,800
1
1 $ 234,300.00
Please note that there is some uncertainty with these estimates and it is recommended that
the Board authorize an expenditure of up to $240,000 not including sales tax and shipping
costs for these replacement MTUs.
Similar to last summer, the Water Department will not have sufficient resources to perform
this MTU replacement work with District staff. Therefore, an outside contractor will be
necessary. A set of bid documents has been prepared and a recommendation for award will
be brought to the Board after the bid opening.
4. FISCAL IMPACT
Total costs for the MTU purchase including sales tax and shipping are estimated at $280,000.
The FY 2020 budget allocates $350,000 for equipment and internal labor associated with
meter maintenance. Beyond the MTU replacement discussed here, there will be additional
meter maintenance activities to be performed by District personnel this summer. It is
recommended that $150,000 of the $350,000 be retained for that purpose and $200,000 be
utilized for this MTU purchase.
Based on the bid prices from last year, the estimated cost for an outside contractor to replace
the 4,800 MTUs is $315,000. The FY 2020 budget included $200,000 for an outside
contractor to perform MTU replacement.
Considering the above items, an additional $195,000 is necessary. The FY 2020 budget
included $1,000,000 for pipeline and facilities modifications to accommodate the installation of
flow meters at pump stations, PRV stations and other strategic locations in the distribution
system. A set of contract documents have been finalized for this work and it expected that
project costs will be about $500,000. Therefore, there should be sufficient funds available to
cover the additional costs associated with the MTU replacement.
Listed in the table below is a summary of the anticipated financial impact of the relevant Water
Department projects. As shown in this table there are sufficient funds to cover the expected costs.
All of these projects are funded from rates and the transfer of reserve funds is not requested
Project Description Original FY 2020 Current Cost
Budget Estimate Estimate
Replacement MTU Procurement
$2,000,000
$280,000
Replacement MTU Installation
$2,000,000
$315,000
Pump Facilities Metering Improvements
$1,000,000
$500,000
10-Year Capital Improvement Plan Update
$0
$60,000
Water Rate and Cost of Service Study
$0
$35,000
Total
1 $1,400,0001
$1,190,000
5. RECOMMENDATION
Authorize the General Manager to execute a procurement contract with Aclara for the procurement
of approximately 4,800 water meter transmitter units MTUs for a total cost not to exceed $235,000,
plus a 10% change order authorization, for a total not to exceed amount of $260,000, plus tax and
shipping.
Michael D. Holley
General Manager / Water Utility Director