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Pre-Proposal Meeting

Pre-Proposal Meeting. REQUEST FOR PROPOSALS (RFP) SOLID WASTE MANAGEMENT SERVICES TO INCLUDE RETROFITTING AND OPERATION OF WASTE TO ENERGY FACILITY RFP # 12-0084 RFP ISSUED BY NEW HANOVER CO. NC December 9, 2011 Pre-Proposal Meeting -- Dec. 15, 2011. Introduction of the County Project Team.

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Pre-Proposal Meeting

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  1. Pre-Proposal Meeting REQUEST FOR PROPOSALS (RFP) SOLID WASTE MANAGEMENT SERVICES TO INCLUDE RETROFITTING AND OPERATION OF WASTE TO ENERGY FACILITY RFP # 12-0084 RFP ISSUED BY NEW HANOVER CO. NC December 9, 2011 Pre-Proposal Meeting -- Dec. 15, 2011

  2. Introduction of the County Project Team

  3. Issuance of this County RFP • This RFP has only been issued to the two Qualified Contractors (QC’s) that were shortlisted as a result of the RFQ process. • The County intends to select the best Proposal in accordance with the evaluation and selection process described in Section Six and Section Seven of the RFP.

  4. County RFP Schedule This schedule is part of Exhibit 2 of the RFP!

  5. TOC Review • Introduction • Background Information on County Solid Waste System • Project Description • Contractual Conditions • Financing • Qualifications of the Proposers • Evaluation and Selection Process • Proposal Submission Requirements • General Requirements • Proposal Forms

  6. APPENDIX A: Definitions APPENDIX B: Forms • Form 1: Summary of the Phase 1 Retrofit Completion Work Costs • Form 2: Itemized Phase 1 Design Build Improvement Costs • Form 3A: Total Phase 1 Management/Operations Costs • Form 3B: Itemized Phase 1 Management/Operations Costs • Form 4: Calculation of the Phase 1 Retrofit Debt Service Payments • Forms 5: Drawdown Schedule of Phase 1 Design Build Improvement Costs (for Publicly Financed Option) • Form 6A: Total Phase 2 Operating Charge • Form 6B: Itemized Phase 2 Operating Charge • Form 7: Proposed Annual Service Fee for Phase 2 • Form 8: Performance Guarantees • Form 9: Development of Major Equipment Replacement and Renewal Fund

  7. Appendix B Continued... • Form 10: Phase 2 Guaranteed Maximum Utility Consumption • Form 11: Electricity Revenue Sharing Proposal • Form 12: Non-Collusion Certification • Form 13: Nondiscrimination • Form 14: Indemnification Agreement • Form 15: Disclosure • Form 16: MWBE Forms & Instructions of County • Form 17: Detailed Facility and Equipment Data • Form 18: Performance Bond Affidavit from Surety • Form 19: Letter of Credit Affidavit from Provider • Form 20: Affidavit of Qualified Contractor as Proposer • Form 21: Company/Guarantor Letter of Intent • Form 22: Letter(s) of Intent

  8. Proposals are requested for the following: • The finance, design, improvement, retrofitting, construction and testing of the current three-line 500 TPD SEF located at 3002 Highway 421 North in New Hanover County; and • After acceptance testing, operate and maintain the SEF for at least 20-years.

  9. Phase 1 Retrofit Completion Work • For the retrofit/upgrade and start-up operations of the SEF, the County requires that the Proposer provide a firm Total Phase 1 Construction Price for all of the design improvements, retrofitting, construction, permitting (as/if needed), start-up, and testing of the upgraded SEF (on Proposal Form 1); and • corresponding Capital Component of the Service Fee (on Proposal Form 4). As envisioned, this work is to bring the SEF capacity back up to the 500 Tons per Day (TPD) nominal capacity, as installed.

  10. County Proposal Preference • In connection with its obligations to pass the Acceptance tests, the County would prefer that the proposer take the “as is“ condition risk of the existing facility and that the price for the Phase 1 Work reflect that risk. • However, since after over two decades of operation, the SEF was taken out of service by the County on April 4th, 2011; the County will consider optional Proposals that limit or mitigate the proposer’s “as is” conditions risk and result in a lower construction price for the Phase 1 Work. Any such Proposal must be both specific and comprehensively presented. Note: The degree of risk shifting associated with such an optional proposal will be an important evaluation factor and such a proposal should clearly state how any as-is condition risk shifted to the County can be limited or mitigated by the County and

  11. RFP Appendices • Appendix A: Definitions of terms Used in the RFP • Appendix B: Forms • Appendix C: Draft Agreement (expected to be issued in about 3 weeks)

  12. Requests for Additional Information or Clarifications (see Section 1.6.2) • Must be made in writing to the RFP Coordinator at the address below at any time but no later than 3 p.m. on January 31, 2012. • Mr. John Hubbard Director, Department of Environmental Management Office: (910) 798-4403 JHubbard@nhcgov.com Note: Date will be revised from 17th to 31st in Addendum No. 1

  13. SEF Aerial Photograph

  14. SEF Division • In 1984 the County started operating the waste-to-energy facility now called the Sustainable Energy Facility, or SEF, which utilizes a mass-burn technology that generates steam for beneficial use. • The SEF operates in accordance with North Carolina Department of Environment and Natural Resources (NCDENR or DENR) Solid Waste Permit No. 65-05-I. • It is located approximately three (3) miles south of the landfill on US Highway 421 North. • Prior to the lay-up and mothballing of the SEF in April 2011, the SEF employed 45 County personnel to operate and maintain three (3) boilers, two (2) generators, and the state-of-the-art pollution control equipment.

  15. SEF Technical Overview • Two 100 ton-per-day units came on-line in 1984. The additional 300 ton-per-day unit became operational in 1991. • The boilers produce superheated steam at 450 pounds per square inch (psi) at the header which is used to turn two (2) turbine generators. • The two (2) generators have a combined gross capacity of 10.5 Megawatts (Mw). SEF powers itself prior to sending electricity into the grid. The interconnection equipment can receive a maximum of 10,000 KVA to the grid.

  16. WASTEC Throughput, Electricity and Natural Gas Consumption (Example) Note: This page will be part of Addendum No. 1 Information

  17. Phase 2 Guarantee From Appendix A Definitions: “Guaranteed Annual Throughput Capacity” means during the Phase 2 Operations Period, the Company will be able to handle at a minimum 150,000 tons/year of Solid Waste generated in the County.

  18. RFP Document Room • The County has completed a variety of studies, and has compiled historical operating and maintenance data, the SEF permits and other materials which provide additional background information on the SEF for assistance in preparing any Proposal. These studies and information are accessible by the QC’s. • Note: Instructions for accessing the RFP Document Room are set forth in Section 1.7.4.

  19. Waste Composition Report • A waste composition study has recently been completed by SCS for New Hanover County. A copy of the Executive Summary of that report is provided in the County on-line RFP Document Room that is accessible by the QC’s.

  20. Section 3.1.1 Project Description A general outline of the minimum design and/or performance criteria for the SEF, once renovated and upgraded is provided. The Proposer must provide a retrofit facility that incorporates 23 specific items...... NOTE: Form 17 provides an extensive review of all of the key components that make up a waste-to-energy plant like the SEF. Form 17 is to be completed only for new equipment that the Company will install at the SEF as part of the Phase 1 Work. Data is not needed for existing equipment that is merely going to be repaired.

  21. Ash Residue and LF Use • The Company will be responsible for the loading and transportation of Ash from the SEF to the County Landfill. • The Company will be responsible for unloading the Ash at the Landfill in an area designated by County staff. • The cost of the disposal of Ash, up to the Ash Quantity Guarantee, will be borne by the County. • Landfill-related disposal costs, for Ash in excess of said Ash Quantity Guarantee, will be to the account of the Company. • The disposal cost at the County Landfill for this excess will be equal to the then current tipping fee per Ton charged by the County. • The County will, at all times during the term of the Agreement, provide the County Landfill for the disposal of Ash and other Unacceptable Waste, except Hazardous Waste.

  22. Terminology of the RFP Phase 1 Retrofit Completion Work and, upon successful completion of the Performance Test, then operate and maintain the SEF during the Phase 2 Commercial Operations Period.

  23. Section 3.5 Phase 2 – Commercial Operations (a thru s) Immediately after the Commercial Operations Date, the specific responsibilities and activities of the Company at the SEF during the 20-year Phase 2: Commercial Operations Period, are expected to include, at a minimum, the items set forth in (a) – (s) in Section 3.5

  24. Phase 1 Retrofit Period Price: for Construction and Operations • Each Proposal must contain a total price (Total Phase 1 Price) for the Phase 1 Retrofit Completion Work Costs (Proposal Form 1) and a Guaranteed Phase 1 Work Period to the Scheduled Acceptance Date (Proposal Form 8). • The Company must provide all services, labor, materials, supplies, personnel and equipment necessary for it to fulfill its obligations related to the Phase 1 Work for the Total Phase 1 Management/Operations Costs set forth in Proposal Form 3A.

  25. Phase 1 Interim Service Fee(Section 4.2.3 of RFP) • The County will pay an Interim Service Fee (Proposal Form 1) to the Company for each Ton of Acceptable Waste received and processed at the SEF until the Phase 1 Acceptance Date has occurred. • The Interim Service Fee should only represent costs to be incurred by the Company that are not included in the Total Phase 1 Management/Operations Costs set forth in Proposal Form 3A (Item B) but are included in Proposal Form 3B. Note: Section 4.2.3 incorrectly referred to Form 3A and will be noted in Addendum No. 1, when issued.

  26. Performance Guarantees • The Project must be designed and constructed to meet Performance Guarantees, as specified in Proposal Form 8, commencing on the Phase 1 Acceptance Date and continuing throughout the Term of the Agreement. • The Agreement will contain a description of the procedures for conducting the Performance Tests and the criteria for determining whether the Project has satisfied them. • The Acceptance Date will not occur until the Project has satisfied the Performance Test and all conditions associated with Phase 1.

  27. Performance Bonds The Company must provide • a performance bond from an A-rated surety Company, in an amount equal to not less than the price for all of Phase 1 Work; and • a labor and material payment bond from an A-rated surety Company acceptable to the County in an amount equal to not less than 100% of the price for the Phase 1 Work.

  28. Renewable Letter of Credit • The Company must provide an annually renewable letter of credit in the amount of $5,000,000 to provide assurance of performance following the Contract Date and during the Term of the Agreement.

  29. Guaranty • Each Proposal must provide that a Project Guarantor will unconditionally, and without limitation as to amount, guarantee the Company's performance of its obligations under the Agreement. • The Project Guarantee must remain in effect during the term of the Agreement, including both Phase 1 Work and Phase 2 Work, as applicable. • Each Proposal must identify the Project Guarantor...using Form 21.

  30. Phase 2 • Beginning on the Phase 2 Operations Commencement Date, the Company will be obligated to accept and dispose of all Acceptable Waste delivered to the Company by the County and its haulers, subject to certain rejection rights specified in the Agreement. • The County will pay a Service Fee (each month after the Acceptance Date) for disposal of Acceptable Waste accepted and processed by the Company at the Facility. • As negotiated, the principal components of the Service Fee will consist of: • a Capital Component (Proposer to use Form 4), • a Phase 2 Operating Charge (Proposer to use Form 6A), and • Pass-Through Costs (to the extent identified in the Draft Agreement).

  31. PPA Revenues & Credits • The County will enter into a power purchase agreement (PPA) for the sale of electricity produced by the SEF. The County will keep all PPA revenues and revenues associated with the sale of environmental attributes related to the electricity produced. • The County will consider sharing a portion of revenues received for quantities of electricity generated in excess of the Company’s electricity production guarantee (Proposal Form 11).

  32. SEF Hours of Service (Section 4.2.16 of the RFP) • The County will provide staff at the SEF scale house to cover the receipt of Solid Waste from 6:30 a.m. to 5:00 p.m., Monday through Friday, and 6:30 a.m. to 12:00 p.m. on Saturday. • No County scale house personnel will be available at the SEF for receiving Solid Waste on Sunday, “Saturday afternoon” or the four Holidays days noted above on which the Landfill is “officially” closed. Note: However, Section 4.3 indicates that the County will work with the selected Company to provide a means of entrance to the Landfill when the Landfill is normally closed. “ “ = new text that will be noted in Addendum No. 1

  33. County-Owned SEF Spare Parts/Maintenance Equipment • As noted on page 35, the County currently owns in excess of $1 million of spare parts and a lot of maintenance equipment that is currently on-site at the SEF

  34. Qualifications Section 7.3 --- the Proposer’s financial and technical qualification’s will be evaluated from the Proposal documentation requested in Section Six and Section Eight of the RFP.

  35. Proposal Evaluation - Technical • Significant factors in the evaluation will include but may not be limited to: • Quality and durability of proposed materials and equipment; • Construction approach including sequencing; • Operation, Maintenance and Management Plans; • Environmental controls demonstrated by criteria and non-criteria emission limit guarantees and overall Facility design; • Operational efficiency demonstrated by energy recovery efficiency, equipment and personnel use, factors, and guaranteed utility consumption; • Staffing Plan; • Commercial reliability; and • Performance capabilities.

  36. Proposal Evaluation–Business Aspects • As part of the evaluation, the County will review and consider the business aspects of the Proposals including, but not limited to: • The exceptions taken to the Draft Agreement; • Performance guarantees proposed by the Proposer; • Guaranteed schedule; and • Plan of finance

  37. Proposal Evaluation-Economic • The economic evaluation will include, among other items: • an analysis of all of the construction-related costs related to the Phase 1 Design/Built Improvements, • the annual Capital Component associated with the Phase 1 Work, • the construction drawdown schedule, • the Phase 1 Management/Operations Fee, • the Phase 2 Operating Charge, • the revenue sharing proposal, • the Guaranteed Annual Throughput Capacity and Guaranteed Electricity Production, and any other cost-related factors. • The County will evaluate the life-cycle costs associated with each Proposal. • A base case set of assumptions will be developed by the County and the County may consider sensitivity analyses.

  38. Proposal Submission Three documents as follows: • Document I: Consisting of - • Executive Summary - Section I (w/Form 22) • Document II: Consisting of - • Qualifications Update - Section II • Project’s Technical Proposal – Section III • Management Proposal - Section IV • w/Forms 8,10 and 17 • Document III: Consisting of - • Business Proposal - Section V • Cost Proposal – Section VI • with all remaining Forms provided in the RFP

  39. Number of Copies of the Proposal • One (1) original • Nine (9) hard copies...numbered

  40. Proposal Price Adjustments As stated in Section 10.1: • The Company agrees that all costs in the Proposal are firm. • The Total Phase 1 Price set forth on Proposal Form 1 will escalate from the date that is 120 days following the Proposal Due Date if the Agreement is not executed by such date through and until the actual Contract Date in accordance with the escalation index identified in the Draft Agreement. • The Phase 2 Operating Charge will escalate from the Proposal Due Date in accordance with the escalation index identified in the Draft Agreement (as such escalation adjustment may be modified pursuant to Proposal Form 6A).

  41. County RFP Schedule This schedule is part of Exhibit 2 of the RFP!

  42. Thank You • Additional Questions and Open Discussion Period, as applicable • Then, tour of the SEF and County Landfill

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