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HomeMy WebLinkAbout14 NV5 Battery Energy Storage System AGENDA ITEM #14 Public Utility District m MEETING DATE: November 1, 2023 TO: Board of Directors FROM: Jared Carpenter, Electric Utility Director SUBJECT: Consideration of a Professional Services Contract with NV5 for Battery Energy Storage System Assessment APPROVED BY: Z- Brian C. Wright, General Manager RECOMMENDATION: Authorize the General Manager to execute a contract with NV5 to perform a preliminary sizing and procurement support for Battery Energy Storage Systems (BESS) in an amount of $55,000, plus a ten percent change order allowance of$5,500 for a total authorization not to exceed $60,500. BACKGROUND: The District's electric utility strives to balance service reliability, environmental sustainability, and customer affordability and utilizes several planning tools which include annual budgets, strategic plan/initiatives, capital plans, resource plans, and financial plans. The District is also subject to a series of State and Federal mandates which influence our purchases of electric resources, and which require every increasing investment in resource adequacy, electric system hardening, and community resiliency. To date, the District has procured electric resources primarily through our membership with the Utah Associated Municipal Power Systems (UAMPS) which includes ownership in UAMPS projects (Horse Butte Wind, Vejo Heat Recovery, Nebo Natural Gas, etc.) and Power Purchase Agreements (Red Mesa Solar, Stampede Hydro, TCID Hydro, market purchases, etc.). The District has achieved over 60% renewable/clean energy ahead of the 2030 mandate and is working hard to achieve the next regulatory mandate of 90% by 2035. The electric utility market is experiencing escalating costs; especially with regards to market price spikes and transmission. As a transmission dependent utility of NV Energy, and having recently been exposed to very high market prices last winter, staff are seeking opportunities for the District to invest in clean energy resources while addressing rising costs and improving service reliability. A Battery Energy Storage System (BESS) study was included in the FY23 Budget's Electric Capital Plan with a purpose of optimizing the overall District peak demand, Page 1 of 3 Page 141 of 143 increasing system reliability, and a longer-term goal of adding local large scale solar that works best when paired with a battery located in an optimized location. The BESS might be able to help during power outages, but the results of the Study and how it functions within our electrical grid are needed to know with certainty. The first step to incorporating a BESS project is to conduct a preliminary energy sizing and physical location analysis to then create procurement documents with a focus on technology that best functions in the mountain environment of Truckee, and capable of responding to the unique energy use of Truckee compared to other utilities. Therefore, the purpose of this BESS study is to provide the District with a conceptual engineering design and to support the procurement process for the necessary hardware and software. ANALYSIS AND BODY: The skill set required for the BESS study is specialized and NV5 is a consulting firm the District has worked with for many years and are known to be skilled in energy storage projects and the requirements needed from an electrical distribution network allowing it to function effectively. District Code Section: 3.08.050 — Agreements for Special Services, allows for the direct procurement of special services under which the BESS study falls. Staff requested and received a Proposal from NV5 to perform a preliminary sizing and procurement support for one BESS project within the District's service territory. The purpose of this BESS study is to provide the District with a conceptual engineering design of one BESS unit located within the existing distribution network and to support the procurement process for the necessary hardware and software. The BESS study will determine an acceptable location, size, and technology that will operate best within and support the distribution system. BESS could be beneficial in increasing the District's clean energy resources, provide net carbon reduction, reduce transmission energy costs, and provide a level of community resiliency during power outages. There are six interrelated steps to the preliminary sizing and procurement support process: • Recommend BESS technologies and a preferred vendor list; • Recommend optimal physical locations; • Develop the BESS Procurement Package including incorporating District comments; • Provide request for information (RFI) support; • Review request for proposal (RFP); and • Assist in bidding selection NV5 has extensive experience in designing and establishing costs for many aspects of a distribution grid including battery storage systems and is highly qualified to perform this work for the District. NV5's project team specializes in engineering distribution systems and project management for electric utilities nationwide, including the District. NV5 has performed engineering design and studies for the District for many years Page 2 of 3 Page 142 of 143 related to geotechnical work for the Water Department. Their proposed schedule aligns with staff's plan spend funds budgeted for FY23 and to have the BESS online in 2025. GOALS AND OBJECTIVES: District Code 1 .05.020 Objectives: 1. Responsibly serve the public. 2. Provide a healthy and safe work environment for all District employees. 3. Provide reliable and high quality water supply and distribution system to meet current and future needs. 4. Provide reliable and high quality electric supply and distribution system to meet current and future needs. 5. Manage the District in an environmentally sound manner. 6. Manage the District in an effective, efficient and fiscally responsible manner. District Code 1 .05.030 Goals: 1. Manage for Financial Stability and Resiliency 2. Environmental Stewardship: Create a sustainable resilient environment for all our communities. 3. Engage with our customers and communities in a welcoming and transparent way to identify opportunities. 4. Take the best of private sector thinking to modernize the utility and add value to our communities. 5. Developing an inclusive culture drives organizational integration and success. FISCAL IMPACT: NV5's Proposal to perform the work includes $55,000 in labor and materials. District staff are also recommending a 10% change order authorization of $5,500 for a total not to exceed contract amount of $60,500. Funds for this work will come from the FY23 budget for professional services, specifically GL accounts 1.6.928.00.740 & 748 which has sufficient funds to cover this expense. ATTACHMENTS: None Page 3 of 3 Page 143 of 143