Neptune Clean Water. Business Plan

Transcription

1 Neptune Clean Water Business Plan July 2015

2 The Only Existing, Quick, Reliable, Affordable, Green and Sustainable Water Project Table of Contents Introduction Background Map..5 Existing Desal. 6 Project Summary Phase 1-10,700 acre-feet per year Phase 2-10,700 acre-feet per year Phase 3-10,700 acre-feet per year Timeline Green Features..17 Proforma Financial.18 Project Structure Project Advisory Board [2]

3 NEPTUNE CLEAN WATER DESAL PROJECT Existing, Quick, Reliable, Affordable, Green and Sustainable We need a new reliable and affordable source of fresh water now and for generations to come. Situated at the 200-acre Moss Landing Commercial Park, NEPTUNE CLEAN WATER DESAL PROJECT (approximately 25 acres) in many ways, is a continuation of and thoroughly re-engineered project formerly known as People s Moss Landing Desal Project. According to the report Carmel River Dam Contingency Plan Plan B Project Report for the water division of the California Public Utilities Commission, published in July 2002, out of the twenty-one possible water sites evaluated, the site of NEPTUNE CLEAN WATER DESAL PROJECT was selected as a Best apparent site. The report states the dependability of the site s desalination water source is literally drought proof. Seawater desalination would be a reliable and affordable drinking water solution for as little as $600 per acre-foot. However, here on the Monterey Peninsula, the reported costs of other proposed desal projects are shockingly high, as much as $27,500 per acre-foot. The esteemed Moss Landing Marine Laboratory endorses Moss Landing Commercial Park as the most suitable location for a desalination plant in Northern California. NEPTUNE CLEAN WATER DESAL PROJECT has many advantages. Its development is years ahead of any other idea or proposed desal project. (All of the infrastructure exists now.) This site has been in the seawater processing and development industry for over 60 years. The following cost, environmental and timing benefits supersede any reasoning for considering any other desal projects: 1) Land, infrastructure and zoning already exists (land, pipes, tanks, backup system, and energy source). a. Reduces construction costs and saves public hundreds of millions in lower water costs. b. Reduces or eliminates any environmental impact associated with a new plant. 2) The Sponsor is a Professional Engineer and has selected a state of the art desalination technology provider and a professional world class general contractor who together built the 50 MGD Carlsbad Desalination Plant in Southern California. a. Utilizes proven off-the-shelf equipment and technology that will significantly reduce the time and engineering cost and construction time. b. The design and equipment are modular and quickly scaled to meet increasing future water demands. 3) Experienced management team of engineers, financial experts and construction managers are in place. 4) Independent studies and environmental reports done, permitting is progressing smoothly. 5) Privately financed without involving any public agency to eliminate funding risks with competitive debt financing to reduce financing costs and save the public millions of dollars. 6) Provides a drought-proof water source quicker than the California Water Project or any other desal project. [3]

4 The water produced by NEPTUNE CLEAN WATER DESAL PROJECT will be pumped from Moss Landing to the California American (CalAm) water system in Seaside, CA via our privately owned pipeline. The City of Pacific Grove has agreed to become the lead Public Agency for Neptune Clean Water Desalination Project for CEQA compliance and for issuing a 30 year water purchase agreement. As the lead agency, Pacific Grove will agree to purchase 10,700 acre-feet of potable drinking water per year from NEPTUNE CLEAN WATER DESAL PROJECT for 30 years. This news resonated favorably all over the Monterey Peninsula with 68% of the people surveyed by the Monterey Herald approving of this development. The deep sea intake idea has been around for over 25 years and was considered by Kaiser and by the National Refractory. Eight years ago, the Moss Landing Water Desal Project s Management Team seriously considered inserting a 24- to 36-inch pipe into the site s existing 52-inch concrete outfall pipe to draw water from the deep sea (which is legally available to the project) and could be utilized if deemed necessary by the engineers. This position was questioned by Mark Stone, a coastal commissioner, at a recent meeting who indicated there is not a significant difference in the environmental impact between the intake from the deep sea (100-foot) or from the surface. Also, the team was advised by a certain highly-respected representative of an environmental group that it is best to stay away from the deep sea and the open sea, and rather stay at the existing area at the enclave next to Moss Landing Harbor. Staying at the enclave rather than the deep sea and the open sea, will eliminate the potential of litigation by environmental groups and others. In addition, according to a recent article in the Santa Cruz Sentinel, Mike Foster, professor emeritus of Moss Landing Laboratories, who chaired a panel that studied intake impacts for the state water board, said that subsurface wells threaten marine life far less than open ocean intakes, even those featuring new screening technology, and there isn t enough study as to the effectiveness of the deep water screens on the West Coast. Drawing the water from the subsurface enclave location near the harbor will gently rotate the water producing a cleansing effect in Moss Landing Harbor. If the engineers determine to use the harbor intake, the advanced filtration system will reduce the intake and entrapment of microorganisms. This site has been in the seawater processing and development industry for over 60 years. [4]

5 NEPTUNE CLEAN WATER DESAL PROJECT Existing, Quick, Reliable, Affordable, Green and Sustainable Moss Landing, California Monterey Bay Proposed Delivery Pipeline Neptune Clean Water Desal Project Red line is the existing outfall pipeline. Blue line is the existing subsurface intake pipelines. Black outline is site for the desal plant same location of former Kaiser seawater processing plant. Monterey 79,200-foot linear pipeline (plus or minus) to Seaside. Cost to build: $18.6 million (approx.): ± $250per linear foot. [5]

6 EXISTING ONSITE Portable Desal System 50 KGD [6]

7 NEPTUNE CLEAN WATER DESAL PROJECT Existing, Quick, Reliable, Affordable, Green and Sustainable PROJECT SUMMARY A. OVERVIEW The Neptune Clean Water Desal Sea Water Reverse Osmosis (SWRO) project is taking a truly innovative approach toward providing an alternative water supply for the Monterey Bay region. The proposed project would deliver raw seawater to the desalination plant through the use of existing intake and outfall pipelines, currently permitted to discharge up to 60 million gallons per day (MGD), regulated by the California Regional Water Quality Control Board (Permit Number CA ). The project will deliver 27 MGD of high-quality drinking water in 3 phases, at a projected average cost of approximately $4,950 AFY to CalAm in Seaside. The project can be designed, assembled, and commissioned within approximately 12 months after acquiring all required permits. B. PLANT LOCATION The proposed project would be located at the Moss Landing Commercial Park, adjacent to the Moss Landing Power Plant on the former National Refractories & Minerals Corporation site. The approximately 200-acre site is presently zoned for light and heavy industrial use. Approximately 25 acres will be designated for the desal plant. This 200-acre site contains approximately 300,000 sq. ft. of refurbished and leased commercial building space. Importantly for the proposed desalination project, the site is presently permitted for seawater intake and discharge of up to 60 MGD conveyed from existing pipelines and pumps station originally installed and permitted to support the magnesium extraction from seawater and refining operations previously conducted at the site, and to discharge water back to the ocean. The water produced by NEPTUNE CLEAN WATER DESAL PROJECT will delivered via our dedicated transmission pipeline to the California American (CalAm) water system in Seaside, CA for further distribution to the rate payers in the Monterey Peninsula. C. PROJECT DESCRIPTION & ENGINEERING The desalination project will consist of these discrete major components: 1. Screened, passive intake pipeline existing 2. Outfall pipeline - existing 3. Intake pump station existing. Pumps will be replaced with modern energy-efficient pumps cost included. 4. Pretreatment media filtration system - either by existing subsurface intake at Neptune Clean Water Desal Project enclave, or a reverse intake from the deep sea whatever method is proven to be the best MGD seawater desalination equipment system that will be assembled on site 6. Energy recovery system to reduce power consumption 7. Post-treatment facilities 8. Finished product water pump station 9. Solids handling system potential near-zero discharge including diffusing system 10. Electrical power supply - existing onsite massive power supply house of 12 KV receiving electricity from neighboring Dynegy Energy. This will contribute to drastically reducing the delivery cost of energy. 11. Conventional 8 MW PhotoVoltaic (Solar) energy system - built offsite, with Tesla battery storage, with a mandatory power sales contract to Pacific Gas & Electric, effectively making a 100% global offset to the desal power consumption. [7]

8 D. TRANSMISSION PIPELINE 24 inch HDPE transmission pipeline from Moss Landing Commercial Park to Seaside, California, distance 13.2 miles, along State Highway 1 on ROW owned by Southern Pacific Railroad and State of California. a) Transmission pipeline paved/hwy LF R-O-W b) Transmission pipeline unpaved R-O-W LF c) Mojo Cojo Slough Crossing 500 LF d) Tembladero Slough Cross 100 LF e) Salinas River Crossing 1000 LF Cost Estimate: $18,650,000 E. WATER STORAGE Product water will be stored onsite for distribution. Sufficient storage (up to 45 million gallon storage tanks) could be provided to meet all regulatory requirements for disinfection. The product water pump station will provide high quality drinking water to the distribution pipeline at the flow and pressure required for distribution. F. WASTE STREAMS NEAR-ZERO DISCHARGE The desalination plant will generate waste streams consisting of concentrate from the SWRO process, sludge from the media filter backwash, sanitary wastewater, spent membrane solution, solid waste, and surface runoff. The plant will be designed and constructed to handle all waste streams generated in an environmentally sound manner and in compliance with all codes and regulatory requirements as may be applicable. The sponsor is evaluating a system which could result in NEAR-ZERO DISCHARGE to the ocean after desalination. This mechanical system utilizes the on-site existing magnesium hydroxide to extract the salt out of the concentrate (brine). This project may be the first of its kind in the world to utilize this revolutionary technology. Cost is under study. G. ENERGY CONSUMPTION - SOLAR Power will be provided to the project by the local electrical supply existing within the footprint of the existing facility. Circuits feeding the desalination plant will be provided from an existing 12 KV electrical system through a 460- volt circuit at over the fence reduced price per kw hour. Usage will be offset from revenues derived from an 8 Megawatt Photovoltaic solar farm to be built on low cost land in the Salinas Valley. The net electric power cost at stabilization of operations, is forecast to be zero. H. PRETREATMENT COMPONENT OPTIONS a) Pretreatment will utilize a granular media filtration system, a proven technology, to protect the integrity, useful life, and reliability of the seawater reverse osmosis (SWRO) membrane system. The system will consist of a single-stage, dual-media granular media system with sufficient redundancy to ensure a reliable, sustainable supply for downstream desalination. Coagulant and filter aid polymer systems will be provided to improve the efficiency of the pretreatment system, if needed, during system operation. The filters will be fully automated and monitored to assure trouble-free operation. b) Filtered, pretreated water, will be temporarily collected in a clean/veil, insuring continuous operation of the downstream SWRO system, prior to being pumped through cartridge filters, and the downstream SWRO desalination system. The media filters are designed to use filtered seawater as a source of backwash water or alternative concentrate. [8]

9 I. WATER QUALITY The plant will supply product water quality in compliance with the regulatory requirements of the California Department of Public Health, Safe Drinking Water Act, and the California Title 22 Code for Drinking Water Standards. The finished product water from the desalination plant will be compatible with other sources of potable water delivered to the same distribution system. J. SERVICE AND SUPPORT FACILITIES The desalination plant will incorporate existing structures and service facilities located at the Moss Landing Green Commercial Park including buildings, roads, parking lots, and a railroad spur. Handicapped access and landscaping will be added. K. ADMINISTRATION, LEGAL, ENGINEERING AND ENVIRONMENTAL CONSIDERATIONS a) Rights-of-way and easement (existing easement on the site of the railroad from Moss Landing to Seaside is owned by Monterey County and available) b) Environmental review, permits c) Mitigation measures d) Design engineering e) Construction management f) Administration/legal L. PERMITTING AND REGULATORY REQUIREMENTS Regulatory Requirements/Permits (N/A Not Applicable) REGULATORY REQUREMENT AGENCY REQUIRED? STATUS Certificate of Public Convenience and Necessity California Public Utilities Commission Yes N/A California Environmental Quality Act (CEQA) State of California Does not apply if desal equipment is personal property N/A SWRCB Order WR Well Permit State Water Resources Control Board Monterey County Environmental Health Department Must comply, but no approval permit required Yes (back-up wells) Pending Public Agency Involvement Current General Plan City of Seaside Yes N/A Underground Services Alert (USA) N/A (unless drilling required) N/A Monterey Bay National Marine Sanctuary (MBNMS) Management Plan The National Oceanic and Atmospheric Administration (NOAA) The MBNMS provides sanctuary approval on RWQCB and other agency permits. Before construction of the proposed project a request for NMSA must be obtained Waiting for Public Agency Involvement [9]

10 Central Coast Regional Water Quality Control Board Basin Plan Regulatory Requirements/Permits (Cont.) Central Coast Regional Water Quality Control Board Carmel Valley Master Plan Monterey County No Yes Pending Monterey County General Plan Monterey County Yes Pending Greater Monterey Peninsula Area Plan City of Marina General Plan and LCP Monterey County Yes Pending City of Marina Yes Pending Fort Ord Reuse Plan (FORP) Fort Ord Reuse Authority Yes City of Del Rey Oaks General Plan City of Del Rey Oaks Yes City of Monterey General Plan City of Monterey Yes Water distribution system Permit Monterey Peninsula Water Management District Yes Encroachment and construction permits Monterey County and Cities of Monterey, Del Rey Oaks, Seaside, Sand City, Carmel-by-the-Sea, Pacific Grove Yes Coastal Development Permit Section 1600 Streambed Alteration permit and incidental take permits California Coastal Commission California Department of Fish and Game CCC is one of California s two designated coastal management agencies.(y) Yes Pending Public Agency Involvement National Pollutant Discharge Elimination System (NPDES) and Permit/401 certification Regional Water Quality Control Board (RWQCB) Yes Clean Water Act (CWA) Section 10 and 404 permits Endangered Species Act (ESA) Section 7 & Marine Mammal Protection Act Section 9 Consultation Army Corps of Engineers (USACE) US Fish & Wildlife Service and National and Oceanographic and Atmospheric Administration Fisheries/NMFS Yes Yes Fish and Wildlife Coordination Act US Fish and Wildlife Service Requires federal agencies to provide equal consideration to fish and wildlife resources in the planning of and proposals for water resource development projects [10]

11 Section 2081 of the Fish and Game Code Regulatory Requirements/Permits (Cont.) California Department of Fish and Game Prohibits take of any state-listed species that the State Fish and Game Commission determines to be endangered or threatened. Section 2081 of the Fish and Game Code Section 10 of the Rivers and Harbors Act of 1899 Regional Water Quality Control Board Operations in US waters; Navigation Clean Air Act Air quality permitting US Corps of Engineers State of California Central Coast US Coast Guard US Environmental Protection Agency Monterey Bay Unified Air Pollution Control District Permits to authorize certain structures or work in or affect navigable waters of the United States Develops and enforces water quality objectives and implementation plans to protect the beneficial uses of the state s waters. TBD No Yes Facilities Siting Permits State Lands Commission Approve leases for new facilities and intakes using once-through cooling systems and imposing certain conditions on lease renewals and extensions for existing facilities. The Commission resolved that intake of large volumes of water OTC has impacts on coastal organisms by entrainment and impingement Existing Intake and Outfall Permits Local Coastal Plans Local Agencies Identify the location, type, densities and other ground rules for future development in the coastal zone. [11]

12 M. SITE FEATURES AND BENEFITS As mentioned above, the following table summarizes the features and benefits of the Moss Landing Green Commercial Park site, which will significantly reduce both the cost of the desalination facility and accelerate the construction schedule when compared to other undeveloped site locations. SITE FEATURE BENEFIT Approximately 55 acres on the available ; 200-acre site (25 acres for plant and 30 acres for optional solar) Available for lease as well as sale. Presently zoned for light, heavy industry and production of utilities Eliminates need for re-zoning. 300,000 sq. ft. of existing building space. Eliminates or reduces project infrastructure cost. Millions of dollars have been spent to clean the site and buildings 100% of the asbestos, lead and oil. 12 KV electrical service available and in working order on-site Existing 60 MGD permit for seawater intake and discharge Existing easements and infrastructure for seawater intake and concentrate disposal Railroad Spur Access 44 million gallons of existing on-site storage capacity tanks have been recently repaired and upgraded. On-site existing fresh water tanks and nearby existing fresh water wells w/capacity of 2,100 gallons per minute Pilot Project in Place Portable (on wheels) desalination plant in place that can produce 50,000 GPD EIR bid obtained for $650,000 to be commissioned only by a public agency Eliminates additional costs. Eliminates or reduces project infrastructure cost. Reduces electrical permitting time and cost. Eliminates or reduces project cost and accelerates construction schedule. This is NLA. Eliminates or reduces costs and time associated with some permits. Eliminates costs and inconvenience associated with construction under Highway 1. NLA. Enables less expensive bulk chemical delivery and pretreatment solids removal. Reduces heavy truck traffic on Hwy 1. Eliminates and drastically reduces project infrastructure cost. Available water source to support construction activities and plant operations and backup systems as required by the Monterey County Health Department. Redundant emergency supply. This creates a legal exemption for EIR and otherwise expensive and extensive permitting required for any new fixed asset real estate development. If required, this cost will be advanced by the sponsor. [12]

13 N. SCHEDULE Approximately April 2018 Phase 1 O. COSTS Phase 1 10,700 ACRE-FEET/YEAR Plant, delivery, and assembly; includes 10% contingency $39,000,000 General Contractor, resurfacing remaining tanks, pipes and pumps, concrete, grading, electric $34,032,050 substations, startup Screening and filtering system, pump station repair, drilling, electrical, $ 4,500,000 Engineering & design $2,000,000 Delivery system to distribution line (onsite) $ 1,000,000 Reserve for chemicals & parts $ 2,000,000 Purchase land of appraised value (76% discount of MAI fair appraised market value $40,000,000 for approx. 55 acres); Appraised value $121,000,000* minus $91,000,000 =$30,000,000* Solar - 8 megawatts with 36 acres sufficient to add 16 MW for Phase 2 and 3 $8,500,000 Financing Costs $6,500,000 Permits Fees & Legal $ 1,750,000 Contingency Reserve $9,000,000 Pipeline to Seaside from Moss Landing Pipeline is 24 inch HDPE transmission - 15 miles = 79,200 feet x ±$250 per ft. $18,650,000 Hard Cost Phase 1 including pipeline to Seaside $166,932,050 Plant, delivery, and assembly, including 10% contingency, bid for $39,000,000). The main contributing factor for the reduction of this cost is the existence of approximately $121,000,000* in infrastructure at a cost to a public agency or the State of California of $30,000,000, and no added profit over the selling price/bid of $39,000,000 for the desal plant, delivery and assembly. This reduction in the cost of the land and the infrastructure and the low cost of the plant, delivery and assembly, will be reflected in the investment of the future building of desalination operations and solar fields to provide energy in the U.S. and around the world. [13]

14 Phase 2 10,700 ACRE-FEET/YEAR Plant, delivery, and assembly; includes 10% contingency $39,000,000 Resurfacing remaining tanks, pipes and pumps, concrete, grading, electric substations $20,136,250 Screening and filtering system, pump station repair, drilling, electrical, $ 1,500,000 Engineering & design $100,000 Delivery system to distribution line (onsite) $ 100,000 Reserve for chemicals & parts $ 2,000,000 Purchase land of appraised value (76% discount of MAI fair appraised market value $0 for approx. 55 acres); Appraised value $121,000,000* minus $91,000,000 =$30,000,000* Solar - 8 megawatts with 36 acres sufficient to add 16 MW for Phase 2 and 3 $3,500,000 Financing Costs $3,100,500 Permits Fees & Legal $ 125,000 Contingency Reserve $5,400,000 Pipeline to Seaside from Moss Landing Pipeline is 24 inch HDPE transmission - 15 miles = 79,200 feet x ±$250 per ft. $0 Hard Cost Phase 2 $74,961,250 [14]

15 Phase 3 10,700 ACRE-FEET/YEAR Plant, delivery, and assembly; includes 10% contingency $39,000,000 Resurfacing remaining tanks, pipes and pumps, concrete, grading, electric substations $20,136,250 Screening and filtering system, pump station repair, drilling, electrical, $ 1,500,000 Engineering & design $100,000 Delivery system to distribution line (onsite) $ 100,000 Reserve for chemicals & parts $ 2,000,000 Purchase land of appraised value (76% discount of MAI fair appraised market value $0 for approx. 55 acres); Appraised value $121,000,000* minus $91,000,000 =$30,000,000* Solar - 8 megawatts with 36 acres sufficient to add 16 MW for Phase 2 and 3 $3,500,000 Financing Costs $3,100,500 Permits Fees & Legal $ 125,000 Contingency Reserve $5,400,000 Pipeline to Seaside from Moss Landing Pipeline is 24 inch HDPE transmission - 15 miles = 79,200 feet x ±$250 per ft. $0 Hard Cost Phase 3 $74,961,250 [15]

16 P. TIMELINE EIR Public Agency T=20 mo Includes 4 months leeway for unforeseen circumstances Permits The People s Moss Landing Water Desal Project Financing Construction Desal/Pipeline Water Delivery [16]

17 NEPTUNE CLEAN WATER DESAL ESTIMATED TIMELINE Public Agency 4 months Oct Beginning October 2015 and ending April 2018 for a total of 30 months Permits 6 months Financing in progress during permit process Construction: Build Desal Build Pipeline Leeway added for Delays or/and Unforeseen Circumstances Water Delivery Oct Feb Aug Aug Aug Months Apr Including, but not limited to: GREEN SUSTAINABLE FEATURES Construction By utilizing existing buildings, we save the exuberant cost of construction, eliminate waste removal, eliminate heavy truck traffic, reduce environmental impact, carbon footprint, pollution, noise and traffic emissions. Transportation The existing railroad spurs will be used for transporting materials and will reduce environmental impact, carbon footprint, fossil fuel use, emissions and pollution, and heavy truck traffic. Energy The solar energy will reduce fossil fuel use, reduce the carbon footprint and save energy. Purchasing next door, over the fence discounted energy will reduce loss of electrical current from long distance delivery. Conservation The owner of the project is salvaging and using the algae which come from the intake water to develop biofuel through the new company (Biofuel USA). Owner also plans to mechanically extract the majority of sea salt from the concentrate, instead of returning it to the ocean (separate business entities). [17]

18 PROFORMA DESALINATION PROFORMA (Annual) Phase 1 Phase 2 Phase 3 Totals REVENUES Water Purchase Contract - Take or $6,900/AF 73,830,000 73,830,000 73,830, ,490,000 Electricity Purchases - PG&E Contract 6,307,200 7,253,280 8,341,272 21,901,752 TOTAL REVENUES 80,137,200 81,083,280 82,171, ,391,752 EXPENSES Operating Contract to Technology Co 2,404,116 2,432,498 2,465,138 7,301,753 Power - Gross, $0.11/kWH 5,210,900 5,471,445 5,745,017 16,427,362 Management Labor 2,404,116 2,432,498 2,465,138 7,301,753 Interest 6,785,520 3,100,500 3,197,040 13,083,060 Depreciation 2,887,000 2,887,000 2,887,000 8,661,000 Land Lease from Neptune LLC 6,000,000 6,300,000 7,615,944 19,915,944 RO Membranes 15,000 20,000 25,000 60,000 UF Membranes 5,000 10,000 15,000 30,000 Maintenance Labor - Owner 3,000,000 3,500,000 4,500,000 11,000,000 Chemicals 3,500,000 4,000,000 4,500,000 12,000,000 Legal & Accounting 125, , , ,000 TOTAL EXPENSES 32,336,652 30,303,942 33,590,278 96,230,871 Gross Profit: 47,800,548 50,779,338 48,580, ,160,881 Sales - AFY 10,700 10,700 10,700 32,100 Price / AFY 6,900 6,900 6,900 Sales / Acre Foot (AF) 73,830,000 73,830,000 73,830, ,490,000 Expense/ Acre Foot (AF) 3,022 2,832 3,139 2,998 Expense / Gallon Return on Investment (%) 28.63% 67.74% 64.81% 46.44% Return on Equity (%) 80.89% % % % Equity Required 59,090,570 25,161,750 24,320, ,572,660 Total CAPEX 166,932,050 74,961,250 74,961, ,854,550 [18]

19 PROJECT STRUCTURE Moss Landing Commercial Park IDE TECHNOLOGY KIEWIT CONTRACTORS Public Agency NEPTUNE S Kramer Don Lew City of Pacific Grove, CalAm Water Company E Jeanne [19]

20 PROJECT ADVISORY BOARD Don Lew Don Lew Chairman S Lew NEPTUNE CLEAN WATER J Lew S Lew President M LeSaffre R VanSteen L Broome R Kakebeen E Jeanne OPEN