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Round 3 Proposal Evaluation Steering Committee Review. Project 150 Evaluation Working Group. September 5, 2008. Evaluation Process Evaluation Committee Steps & Minimum Requirements Evaluation Metrics Project-based Sensitivity of Results to Key Variables. Project Evaluation Results

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Project 150 Evaluation Working Group


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    1. Round 3 Proposal Evaluation Steering Committee Review Project 150Evaluation Working Group September 5, 2008

    2. Evaluation Process Evaluation Committee Steps & Minimum Requirements Evaluation Metrics Project-based Sensitivity of Results to Key Variables Project Evaluation Results Overview of Recommended Projects Recommendations Recommended On the fence Not recommended Presentation Overview • Proposal Summary Statistics • # Projects & MW by Technology • Strength of the field • CCEF Funds Requested • Ratepayer Cost Impacts • SW CT Benefits • Agreement on Proposal Recommendations to CCEF Board • Next Steps & Timing Internal Working Document – For Discussion Purposes

    3. Evaluation Process:Evaluation Committee Internal Working Document – For Discussion Purposes

    4. Evaluation Process:Key Steps Review and refine evaluation methods & Scoring Weights Review proposals for Minimum Bid Eligibility Requirements Review proposals as submitted Face-to-face project interviews to clarify proposals & address questions Written project responses to specific questions Individual evaluators score each project on non-price evaluation criteria Consultants calculate net ratepayer impact Two day evaluator meeting to review net ratepayer impact analysis, discuss projects, finalize scores, consider key sensitivities, and rank projects Internal Working Document – For Discussion Purposes

    5. Proposals Not Meeting Minimum Bid Requirements • Versailles Renewable Energy • Landfill-methane-by pipeline at CHP plant • Ineligible pricing option (as determined by DPUC), no alternative offered • Elemental Power “Quad” • Fuel cell in CHP configuration • Site control not secured Internal Working Document – For Discussion Purposes

    6. Cost to Ratepayers NPV Ratepayer Impact (55) Note: Higher score means lower net ratepayer costs Evaluation Metrics (Points out of 100) Key: Scoring metric determined by quantitative analysis of proposal Evaluator subjective metric • Feasibility • Team experience (3) • Permitting status (3) • Public acceptance (2) • Site issues (2) • Reasonableness of schedule (1) • Design status (2) • Technology risk (2) • Interconnection analysis (2) • Quality of operating plan (1) • Quality of resource/ fuel plan (2) • Ratepayer Benefits • Increased access to RE w/ min. env. Impact (2) • CT econ. dev. Benefits (2) • Output & reliability at system peak (1.5) • Long term price suppression (1) • Innovative use of technology (1) • T&D reliability (1) • Project Diversity: tech., fuel source, location & size (0.5) • Timing (1) • Financial Viability • Sound financial expectations & assumptions (3.75) • Financing experience (2.25) • Financial strength of developer (3) • Realistic financing structure (1.5) • Capital Risk (2.25) • Equity participation (2.25) • 20 • 55 • 15 • 10 Internal Working Document – For Discussion Purposes

    7. Consideration ofPortfolio Characteristics Limited variety of technologies among proposals meeting minimum threshold review All natural gas fuel cells manufactured in CT Why? Biomass potential largely tapped Limited indigenous wind & hydro resources, none sufficiently advanced for this solicitation Solar unable to beat the price cap LFG-by-pipe project selected ineligible price option Internal Working Document – For Discussion Purposes

    8. Proposal Summary Statistics 45.1 MW Total Internal Working Document – For Discussion Purposes

    9. Proposal Summary Statistics:Strength of the Field Reasonably competitive: Proposals ~3x target MW before threshold review; Final evaluation pool~ 2x target MW Not a diverse mix All proposals = same fuel & base technology and manufacturer Variety of stages of development Many have strong financial partners and/or proponent equity 3 of final 7 projects requested additional CCEF funding Scoring tightly clustered all scores between 67.3 – 71.0 of 100 Internal Working Document – For Discussion Purposes

    10. Proposal Summary Statistics: CCEF $ Requested Binary distribution of funding requests 4 requested no additional $ 3 requests between. $1.5 – 3 million Total requested (7 proj.) = $7.75 million Internal Working Document – For Discussion Purposes

    11. Proposal Summary Statistics: Ratepayer Cost Impacts Net NPV cost impact to ratepayers of payments to projects… Evaluated on a consistent basis… After taking credit for the market value to ratepayers ofexpected energy generated, locational forward capacity and RECs provided… and CCEF $ Internal Working Document – For Discussion Purposes

    12. Proposal Summary Statistics: SW CT Benefits Internal Working Document – For Discussion Purposes

    13. Project Evaluation:Overview of Recommended Projects Internal Working Document – For Discussion Purposes

    14. Project Evaluation:Summary of Recommended Projects Internal Working Document – For Discussion Purposes

    15. Pricing Options Selected Option 6 – 50% of Wholesale Market Energy Cost Plus Project Cost of Natural Gas As The Primary Fuel (Not Subject To Price Cap). 4 Proposals Option 6a – 50% of Wholesale Market Energy Cost Plus Project Cost of Natural Gas As The Primary Fuel (Not Subject To Price Cap), adjusted downward by proposer-defined price modifier. 3 Proposals This is a new pricing option introduced by CCEF in Round 3 One response had variable downward adjustment tied to market REC prices Internal Working Document – For Discussion Purposes

    16. Discussion of Recommendations Internal Working Document – For Discussion Purposes

    17. Scoring Summary: Recommended * Secondary SW CT, ** Primary SW CT Internal Working Document – For Discussion Purposes

    18. Scoring Summary: On the Fence • Pro = provides technology & developer diversity • Con = request of $3m for a 3MW project * Secondary SW CT, ** Primary SW CT Internal Working Document – For Discussion Purposes

    19. Scoring Summary: Not Recommended * Secondary SW CT, ** Primary SW CT Internal Working Document – For Discussion Purposes

    20. Internal Working Document – For Discussion Purposes Levelized Contract Prices

    21. Alternative Proposalswithout ITC/PTC extension Internal Working Document – For Discussion Purposes

    22. Evaluated the impact of: Future electricity/natural gas price trajectories (base, low, high) Future REC price trajectories (base, low, high)  Some reordering within short list, and not-recommended group, but no shifts between groups For perspective, also calculated… Ranking w/o CCEF funding $  ‘Cube’ Project would jump from 5th to top-ranked Approximate utility ranking on ratepayer cost only w/o CCEF funding $ ‘Cube’ Project would jump from 5th to top-ranked, BFCP straddled the cutoff Sensitivity of Resultsto Key Variables  The recommended results are resilient! Internal Working Document – For Discussion Purposes

    23. Base Case Results Internal Working Document – For Discussion Purposes

    24. Sensitivity Analysis: High Electricity & Natural Gas Prices Internal Working Document – For Discussion Purposes

    25. Sensitivity Analysis: Low Electricity & Natural Gas Prices Internal Working Document – For Discussion Purposes

    26. Internal Working Document – For Discussion Purposes Sensitivity Analysis: High REC Prices

    27. Sensitivity Analysis: Low REC Prices Internal Working Document – For Discussion Purposes

    28. Sensitivity Analysis: CCEF Funding Not Included Internal Working Document – For Discussion Purposes

    29. Sensitivity Analysis: Rate Impact Ranking without CCEF $ Internal Working Document – For Discussion Purposes Approximates Expected Utility Rankings

    30. Project Proposal Summaries Internal Working Document – For Discussion Purposes

    31. Project 008 Fuel Cell with turbo expander Fuel Cell Energy – DFC-ERG Bloomfield • Location: • Bloomfield, CT (outside SWCT) • At CNG pressure letdown/gate station • Description: • Molten Carbonate Fuel Cell with turbo expander “Energy Recovery Generator” • Turbo expander captures energy lost in a gate station pressure reducing valve • Eliminates need for gas-fired heaters • 3.367 MW total (~850 kW from ERG) • Team Experience: • Fuel Cell Energy - Manufacturer • Enbridge Inc. – A major fuel supplier & N. America energy player, as developer • Energy East/CNG – Fuel supplier, holds title to the land and access to the pressure let down station • BOC Cryostar, Inc. – world leader in radial inflow turbine technology. • Project Status: • Interconnection – prelim. CL&P discussions • Permit applications – pending • Site control established – host on the team • Design – Conceptual engineering completed • Requested additional CCEF $: 0 • Contract Term: 20 years • NPV Rate Impact incl. CCEF $: • Total: $12.0 million • Per MWh: $23.57 • Other: 50% RECs retained Internal Working Document – For Discussion Purposes

    32. Fuel Cell with turbo expander Project 008 Fuel Cell Energy – DFC-ERG Bloomfield • Strengths • Innovative use of technologies • Strong project team • Limited technology risk • Highly efficient use of thermal output • Local support for project • No additional CCEF $ requested • Least expensive fuel cell project • Weaknesses • Limited operating experience with 2.8 MW units • Limited development progress Internal Working Document – For Discussion Purposes

    33. Bridgeport Fuel Cell Park Location: Bridgeport, CT (Primary SWCT) Description: Molten Carbonate Fuel Cell Organic Rankine bottoming cycle 14.3 MW total (~ 930 kW from ORC) Team Experience: Fuel Cell Energy – Manufacturer and co-developer PurePower, LLC – A firm specializing in developing large scale fuel cell projects in CT PinPoint Power, LLC – Develops, owns and manages power generating and DSM equipment in the Northeast Project Status: Interconnection – UI feasibility study complete; SIS & FS outstanding Permit applications – Approved by Siting Council. Preliminary permitting review completed, no major issues identified Site control estab. - Signed lease option Design – Preliminary design completed Requested additional CCEF $: $1.5M Contract Term: 15 years Rate Impact: Total: $49.6 million Per MWh: $28.35 RECs: 100% RECs retained REC value > $10 reduces price Fuel Cell w/ ORC Project 005 Internal Working Document – For Discussion Purposes

    34. Bridgeport Fuel Cell Park Strengths Redevelopment of a brownfield site Advanced permitting and development status Strong city support Strong project team Improved recovery of waste heat in ORC Creative price modifier: returns REC value in excess of $10/MWh to ratepayers Weaknesses Limited operating experience with 2.8MW units Of recommended projects, most expensive ratepayer impact per MWh Project 005 Fuel Cell w/ ORC Internal Working Document – For Discussion Purposes

    35. Fuel Cell with turbo expander Project 009 Fuel Cell Energy – DFC-ERG Trumbull • Project Status: • Interconnection – prelim. UI discussions • Permit applications – pending • Site control established – host on the team • Design – Conceptual engineering completed • Requested additional CCEF $: 0 • Contract Term: 20 years • NPV Rate Impact incl. CCEF $: • Total: $11.9 million • Per MWh: $24.66 • Other: 50% RECs retained • Location: • Trumbull, CT (primary SWCT) • At SCG pressure letdown/gate station • Description: • Molten Carbonate Fuel Cell with turbo expander “Energy Recovery Generator” • Turbo expander captures energy lost in a gate station pressure reducing valve • Eliminates need to run gas-fired heaters • 3.200 MW total (~600 kW from ERG) • Team Experience: • Fuel Cell Energy - Manufacturer • Enbridge Inc. – A major fuel supplier and N. America energy player, as the developer • Energy East/CNG – Fuel supplier, holds title to land &access to pressure let down • BOC Cryostar, Inc. – world leader in radial inflow turbine technology. Internal Working Document – For Discussion Purposes

    36. Fuel Cell with turbo expander Project 009 Fuel Cell Energy – DFC-ERG Trumbull • Weaknesses • Limited operating experience with 2.8 MW units • Limited development progress • Strengths • Innovative use of technologies • Strong project team • Limited technology risk • Highly efficient use of thermal output • Local support for project • No additional CCEF $ requested Internal Working Document – For Discussion Purposes

    37. Fuel Cell with turbo expander Project 007 Fuel Cell Energy – DFC-ERG Glastonbury • Project Status: • Interconnection – prelim. CL&P discussions • Permit applications – pending • Site control established – host on the team • Design – Conceptual engineering completed • Requested additional CCEF $: 0 • Contract Term: 20 years • NPV Rate Impact incl. CCEF $: • Total: $12.1 million • Per MWh: $24.73 • Other: • 50% RECs retained • Location: • Glastonbury, CT (outside SWCT) • At CNG pressure letdown/gate station • Description: • Molten Carbonate Fuel Cell with turbo expander “Energy Recovery Generator” • Turbo expander captures energy otherwise lost in a gate station pressure reducing valve • Eliminates need to run gas-fired heaters • 3.200 MW total (~600 kW from ERG) • Team Experience: • Fuel Cell Energy - Manufacturer • Enbridge Inc. – A major fuel supplier and N. America energy player serv. as developer • Energy East/CNG – Fuel supplier, holds title to land &access to pressure let down station • BOC Cryostar, Inc. – world leader in radial inflow turbine technology. Internal Working Document – For Discussion Purposes

    38. Fuel Cell with turbo expander Project 007 Fuel Cell Energy – DFC-ERG Glastonbury • Weaknesses • Limited operating experience with 2.8 MW units • Limited development progress • Strengths • Innovative use of technologies • Strong project team • Limited technology risk • Highly efficient use of thermal output • Local support for project • No additional CCEF $ requested Internal Working Document – For Discussion Purposes

    39. Elemental Power – ‘Cube’ Project Location: Danbury, CT (Secondary SWCT) Description: Molten Carbonate Fuel Cell Waste heat drives an un-fired combustion turbine – generator in a Brayton cycle 3.2 MW total (~ 500 kW from turbine) Team Experience: EPG Fuel Cell – Subsidiary of Elemental Power Group, a company formed to develop own and operate clean renewable energy projects Catamount Energy - financier Fuel Cell Energy – Manufacturer Project Status: Interconnection – Application submitted to CL&P Permit applications – prepared for filing Site control established – affiliate has lease Design – conceptual design complete Requested additional CCEF $: $3 M Contract Term: 20 years Rate Impact: Total: $13.5 million Per MWh: $25.78 Other: 50% RECs retained Fuel Cell with Unfired Combustion Turbine Project 001 Internal Working Document – For Discussion Purposes

    40. Elemental Power – ‘Cube’ Project Strengths Efficient configuration: low heat rate Local zoning changes already made to accommodate projects – i.e. strong town support Strong development team Innovative combination of existing technologies ‘Load reducer’ treatment gives more immediate FCM value Weaknesses Limited operating experience with 2.8MW units Technology is scale-up of a pilot Highest $ request from CCEF, by far Fuel Cell with Unfired Combustion Turbine Project 001 Internal Working Document – For Discussion Purposes

    41. Project 006 Fuel Cell CHP Ten Companies Inc. – Hartford Fuel Cell • Location: • Hartford, CT (outside SWCT) • Description: • Molten Carbonate Fuel Cell • CHP with heat recovery for district steam • 2.700 MW total • Team Experience: • Energy East (utility owner of both gas supplier and steam company) • Project Status: • Interconnection – prelim. CL&P discussion • Permit applications – scoped • Site control established – own site • Design – Conceptual engineering completed • Requested additional CCEF $: 0 • Contract Term: 15 years • NPV Rate Impact incl. CCEF $: • Total: $9.8 million • Per MWh: $29.88 • Other: 50% RECs retained Internal Working Document – For Discussion Purposes

    42. Fuel Cell CHP Project 006 Ten Companies Inc. – Hartford Fuel Cell • Strengths • Self-financing • Ease of integration with site uses (other generation, steam plants) • Limited technology risk • CHP = Efficient use of thermal output • No additional CCEF $ requested • Weaknesses • Limited operating experience with 2.8MW units • Limited development progress • Highest ratepayer impact metric Internal Working Document – For Discussion Purposes

    43. Elemental Power – Triangle Project Location: Danbury, CT (Secondary SWCT) Description: Molten Carbonate Fuel Cell Organic Rankine bottoming cycle 15.1 total MW (~ 950 kWh from ORC) Team Experience: EPG Fuel Cell – Subsidiary of Elemental Power Group, a company formed to develop own and operate clean renewable energy projects Catamount Energy - financier Fuel Cell Energy – Manufacturer Project Status: Interconnection – Application submitted to ISO-NE, directed to submit a distn . level interconnect, CL&P feasibility study in process Permit applications – Near completed Site control established – under lease Design – conceptual design complete Requested additional CCEF $: 3M Contract Term: 15 years Rate Impact: Total: $53.4 million Per MWh: $29.14 Other: 50% RECs retained Fuel Cell with ORC Project 002 Internal Working Document – For Discussion Purposes

    44. Elemental Power – Triangle Project Strengths Straightforward interconnection Local zoning changes already made to accommodate projects – i.e. strong town support Strong development team Using Organic Rankine Cycle to maximize efficiency (replicable technology improvement) Weaknesses Limited operating experience with 2.8 MW units Large CCEF $ request High ratepayer impact metric Fuel Cell with ORC Project 002 Internal Working Document – For Discussion Purposes

    45. Process & Timing Next Steps Select proposals to recommend to the CCEF Board CCEF Board Meeting Monday, Sept. 15, 2008 Recommendations submitted to DPUC and Utilities Tuesday, Sept. 16, 2008 Written testimony in support of CCEF recommendations Scheduled October 6, 2008 Hearings scheduled Oct. 22-24, 2008 Draft decision scheduled Dec. 16, 2008 Final decision scheduled Jan. 7, 2009 Internal Working Document – For Discussion Purposes