Renewable System Designs

Preliminary Proposal for:

Mountain View

Electric Association, Inc.

Proposal Architects:

Marlene HebnerLoren Schwappach

Chris WilliamsonAnthony Santistevan

December 2010

Agenda

Topic Presenter Introduction & Project Overview Loren Schwappach Initial Findings Marlene Hebner Plans and Financing Marlene Hebner Project Milestones & One-line Diagram Anthony Santistevan Permitting and Environmental Baseline Anthony Santistevan Project Phasing Marlene Hebner Wind Power Availability Research Loren Schwappach Site Layout Diagrams Loren Schwappach Turbine Selection Criteria Chris Williamson Selected Turbine Features Chris Williamson Project Timeline & Gantt Chart Anthony Santistevan Construction Plan Loren Schwappach Supporting Documentation Chris Williamson

Introduction

• As an American owned Limited liability company (LLC) Renewable Systems Design (RSD) has a proven reputation for engineering state of the art, cost effective renewable energy solutions across the globe.

• Located in downtown Colorado Springs, Renewable Systems Design has over 12 staff electrical engineers, 22 skilled turbine technicians, and a large diverse labor force making RSD the #1 renewable energy design firm in the west.

• RSD designs provides large and small scale renewable energy solutions while controlling operational costs, and enabling owners to secure low-cost electricity for the future.

Project Overview

• Mountain View Electric Association, Inc. is expanding capabilities in renewable energy generation and has partnered with the Colorado Department of Energy for installation of a 1 sq. mile Wind Farm Lot located on MVEA property at 38° 57’N, 104° 39’W.

• Renewable Systems Design (RSD) has been contracted to perform a feasibility report / preliminary proposal for MVEA for the said development, construction and future maintenance of the MVEA wind farm.

Project Overview

As agreed MVEA shall provide the following:

1. Paved road access to all construction sites.2. A maintenance facility, consisting of an on-site building with

workshop and garage space.3. A substation designed for direct connection to the wind farm.

MVEA requests the wind farm meet the following specifications:

Criteria Specification

Maximum Output Power 12MVA

Planned average output power 4MVA

Output Power 600V, 60Hz, 3phase

Initial Findings

• The proposed wind farm will be comprised of six GE 2.5xl (2.5MW) wind turbines staggered 500m apart on an east west line.

• At Ideal wind speeds the wind farm will produce a maximum of 15MW of power with an average output of 4MW.

• Each wind turbine will perform voltage and power regulation, and transfer power to MVEA substation via a Kerite 1000 kcmil 34.5 kV underground line.

• The total cost for the proposed wind farm is $26.65 M. With an estimated break even point after 13 years.

• In 20 years the proposed wind farm is estimated to generate approximately $4.8M in revenue (NPV) with an annual power production of 35,000 MWh.

Plans and Financing

PROJECT SUMMARY

Renewable System DesignsProject Size (MW) 4 avg (15 max)Turbine Model GE 2.5MWNet Capacity Factor (Years 1-20) 27%Total MWh Produced (Years 1-20) 700,000

Total Installed Cost $26.7M

Bond Duration (Years) 15Bond Interest Rate 5.06%Bond Payment (Years 1-15) $2,578,000

O & M (% of revenues) 3%Capital Cost per MWh $60

Project Parameters

Per Wind Turbine Rated Output (MW) 2.5

Number of Wind Turbines 6

Project Life (years) 20

Initial Investment Cost ($M) 26.65

Year construction is completed 2012

Revenue (MWh)

Selling Price of Electricity 40

Green Electricity Premium 30

Total (MWh) 70

Capital Cost

1) Site:

Wind Speed Feasibility Studies 250,000

Permits, Contracts, & Related Fees 33,000

Engineering and Development 595,000

Power line to Grid 258,300

Total ($) 1,136,300

2) Per Wind Turbine:

Base 1,125,000

Crane 60,000

Tower 360,000

Wind Turbine and Blade System 2,400,000

Installation Labor & Training 130,000

Installation Material 50,000

Total ($) 4,125,000

Plans and Financing

Operating and Maintenance Expenses

1) Site (per year)

Maintenance Expenses 20,000

Total ($ per year) 20,000

2) Per Wind Turbine (per year)

Inspections 7,000

Cleaning 4,500

Maintenance and Repairs 43,500

Total ($ per year) 55,000

Financing

Annual Compound Interest Rate (%) 5.06

Length of Loan (years) 15

Inflation (%)

Electricity Selling Price Annual Inflation 3

Expense Annual Inflation 3

Incentives

Production Tax Credit ($/kWh) 0.021

Plans and Financing

Yearly Net Energy Yield

1) Production Losses (%):

Ice & Cold Temperature Related 3

Grid & Substation 3

Array 0

2) Annual Energy Yield Predictions (MWh):

Gross 40,000

Net 35,000

Maximum Yield (MWh) 75,000

Capacity Factor (%) (Net Yield/Max Yield) 27

Plans and Financing

Plans and Financing

The following resources provided critical financial planning information for your proposal:

Colorado Wind POCs:

Mona Newton, Central Regional Representative,

Colorado Governor's Energy Office

Phone: (303) 866-2100

Colorado Anemometer Loan Program:

Contact: Mr. Michael Kostrzewa,

P.E., Director, Colorado Anemometer Loan Program,

Colorado State University

Phone: (970) 491-7709

Colorado Wind Farm Incentive Program:

Program Sponsor: Colorado Department of Local Affairs, Division of Property Taxation

Website: http://dola.colorado.gov/dpt/state_assessed/docs/2007%20Cost%20Threshold%20memo.pdf

Plans and Financing

Project Milestones

12/17/10 Begin Project

1/13/11 Construction Begins

- All Financing has been completed

- Recommend MVEA begin site preparation

9/26/11 All site preparation must be completed

9/29/11 Begin Wind Turbine Assembly

1/27/12 All construction complete. Begin operational checks

2/9/12 Handover to MVEA for commissioning

Project Milestones

One Line Diagram

Underground 34.5kV Bus

Project Permitting

Project Permitting:

As previously agreed, MVEA will procure /ensure all permitting and site certification requirements are obtained by 1/17/11.

Information on Colorado Springs Permits, Applications and Fees can be obtained at:

http://www.springsgov.com/page.aspx?navid=550

Environmental Baseline

Environmental Baseline:

MVEA has ensured that an environmental baseline of the site was conducted, and the site has been authorized by the governmental authorities for the proposed Wind Farm.

Project PhasingPhase 1: Initiation and Feasibility

1a) Determine Project Requirements:• 4 MW output power required, lifespan of 20yrs.

1b) Perform Feasibility study:• Inventory & assessment of risks displayed sufficient wind resource & grid capacity at site.

1c) Perform Pre-Energy Analysis:• 6.8 m/s average wind speed at hub height of 100m• Wind speed according Weibull distribution function• Net energy yield of 35,000 MWh (6 GE 2.5xl 100m turbines)

1d) Plan area for the 4 MW Wind Farm:• Site Coverage = 1 sq. mile• Distance between turbines & building etc

• Minimum separation of 500m (for 0% array loss) 1e) Create investment and operational costs plan:

• Initial investment costs = 26.65M (4.44M*6) • Yearly operational costs = 450k (75k*6)

Project PhasingPhase 2: Preconstruction

2a) Environmental permit & noise restrictions• Completed by MVEA

2b) Determine grid connection – High voltage level (34.5 kV):• Each turbine equipped with a transformer

2c) Perform project financing analysis 2e) Calculate yearly net energy yield of the 4 MW wind farm:

• Gross energy yield 40,000 MWh• 0% array losses (turbulence due to distance between adjacent turbines) • 3% airfoil losses due to icing and cold weather• 3% grid losses (electrical losses between turbine switchgear & grid connection) • 93.6% availability (typically 97% or greater) • Net energy yield: 35,000 MWh (total)

Project PhasingPhase 3: Engineering and Construction

All activities from commencement of works to operation of Wind Farm.

3a) Ensure access to site & storage facility• Components shipped to site: foundation anchor, tubular tower parts, ground ctrl & switchgear, transformer, assembled nacelle, hub & rotor blades.

3b) Proceed with Crane Operations• 600 ton to hoist tower parts, nacelle, & rotor

3c) Install wind turbines at site.

3d) Inspect/Take Over Wind Farm after completion of building and installation.

Project PhasingPhase 4: Operation and Maintenance

4a) Daily Operation and Maintenance of Wind Farm• Average Maintenance Service = Approx $75k per turbine per year = $450k per year.• Warranty & maintenance become active after commission

Available Wind Power:

The amount of energy that a wind turbine can produce is dependant on the wind regime where it is located and the efficiency with which it captures the wind.

The wind regime is defined by three characteristics:1. The average wind velocity2. The Weibull distribution of the wind velocity,3. Wind shear (and turbulence) of the wind at the turbine

location.

Criteria used in Turbine SelectionAvailability of Wind Power

Location of Wind Farm

Microsoft MapPoint North America 2010Wind Farm Location Results.

Google Map Results of Wind Farm Location:Degrees Minutes and Seconds to Decimal Degrees Equivalent

Availability of Wind Power

This WindrosePlot shows the nominal wind

direction at the site location

Availability of Wind Power

Location of Wind Farm

50m Annual Wind Speeds Map

Approx 6m/s wind speeds at 50m

Availability of Wind Power

Approx 7.5m/s wind speeds at 100m

Location of Wind Farm

100m Annual Wind Speeds Map

Availability of Wind Power

MVEASubstation

MVEA proposed 1 sq. mile lot

Alt MVEA proposed 1 sq. mile lot (Chosen)

Housing

Housing

Site Layout – Option 1

MVEASubstation

Alt MVEA proposed 1 sq. mile lot (Chosen)500 m = Approx 0.31 mi

Access Road

Underground 34.5kV Bus

250m500m

1250m

Distance:

Prevailing Wind Direction

Swept Area

Site Layout – Option 2

Project DevelopmentTurbine Selection Criteria

Criteria used for turbine selection:

1) Power production at site (nominal wind speeds)

2) Cut-in / Cut-out wind speeds

3) Purchase costs / average maintenance costs

4) Swept area & turbine weight

5) Features

a) Full power conversion providing quality power to the grid.

b) Minimal noise

c) Lifespan

6) Reliability

Turbine manufacturers reviewed in our proposal:

(US)

Northern Power Systems:

http://www.northernpower.com/wind-power-products/index.php

*GE:

http://www.gepower.com/prod_serv/products/wind_turbines/en/index.htm

(NON US):

Aeolos:

http://www.windturbinestar.com/

Coemi:

http://www.coemiwindturbines.co.uk/index

*After reviewing turbine performance/features against costs and availability we choose the GE 2.5MW 100m turbine.

Project DevelopmentTurbine Manufacturers Analyzed

Project DevelopmentSelected Wind Turbine Features

Project DevelopmentSelected Wind Turbine Features

Selected Wind Turbine Features

Project DevelopmentSelected Wind Turbine Features

Project DevelopmentSelected Wind Turbine Features

Project Timeline

Gantt Chart

Project DevelopmentConstruction Plan

The construction of the Mountain View Electric Association Inc. Wind Power Project will be performed in several stages and will include the following main elements and activities:

Mountain View Electric Association Inc. Responsibilities:• Grading of the field construction office area (also used for O&M building)• Construction of site roads, turn-around areas and crane pads at each wind

turbine location• Provide substation• Plant commissioning and energization

Renewable System Designs, Inc. Responsibilities:• Construction of the turbine tower foundations and transformer pads• Installation of the electrical collection system – underground and some

overhead lines• Assembly and erection of the wind turbines

Proposed Project Construction Schedule Summary

TASK / MILESTONETIME ALLOCATED

FOR TASKSTART FINISH

Approx:On-Site

Manpower for Task

1 Obtain Site Certification 1 Month TARGET 1/17/11 *MVEA Provided

2 Engineering/Design/Specifications/Surveys 2 Weeks 1/17/11 2/1/11 15

3 Purchase Order to Transport 9 Months 1/17/11 10/16/11 N/A

4 Road Construction 3 Months TARGET 3/15/11 *MVEA Provided

5 Foundations Construction 6 Months TARGET 6/16/11 *MVEA Provided

6 Electrical Collection System Construction 6 Months 2/1/11 8/2/11 30

7 Substation Construction 0 Months N/A Completed *MVEA Provided

8 Wind Turbine Assembly 4 Months 10/17/11 02/15/12 40

9 Plant Energization and Commissioning 0 Months N/A Completed *MVEA Provided

10 Wind Farm Substantial Completion 14 Months TARGET 02/16/12 N/A

11 Construction Clean-Up 2 Weeks 02/16/12 03/02/12 15

TOTAL (Excluding MVEA Manpower) 130

Project DevelopmentConstruction Plan

Construction Labor Force Mix (Approximate # Personnel)

ConstructionPhaseProject

Management & Engineers

Field Technical Staff

Skilled Labor & Equip

OperatorsUnskilled Labor Total

Engineering/Surveying/Design 6 12 0 0 18

Road Construction *MVEA *MVEA *MVEA *MVEA *MVEA

Foundations Construction * MVEA *MVEA *MVEA *MVEA *MVEA

Electrical Collection System Construction 2 3 23 12 40

Substation Construction N/A N/A N/A N/A N/A

Wind Turbine Assembly and Erection 4 6 15 15 40

Plant Energization and Commisioning *MVEA *MVEA *MVEA *MVEA *MVEA

Construction Clean-Up 1 1 3 10 15

TOTALS (Excluding MVEA Labor) 18 32 56 37 143

Project DevelopmentConstruction Plan

Operations and Maintenance Labor ForceIf Agreed upon the project will be operated and maintained by a team of approximately 10 to 12 on call personnel consisting of the following staff positions:

Position Number of Personnel

Wind Turbine Site Manager 1

Operations Manager 1

Operating Technitians 6-8

TOTAL 10-12

The Operations and Maintenance (O&M) team will staff the Project during core operating hours 8 hours per day, 5 days per week, with weekend shifts and extended hours as required. In the event of outages, the system will send alarm messages to on-call technicians via pager or cell phone to notify them of the outage. The Project will always have a local, on-call local technician who can respond quickly in the event of any emergency notification or critical outage. Operating technicians will rotate the duty of being on-call for outages.

Project DevelopmentConstruction Plan

Supporting Documentation

• Wind power production and cost analysis was calculated using RETScreen International’s clean energy project analysis software.

• Average wind speed, availability, and prevailing wind direction were calculated using the previous 3 years of data collected at the nearest and best representation of the site location, the Colorado Springs Airport.

• Wind shear coefficient was calculated using information gathered from several previous studies and estimated based on the terrain at the project site.

• Underground high voltage cable was selected to avoid potential damage due to severe weather.

• The Kerite Company’s 35kV URD underground cable was selected based on the company’s reputation of creating the most reliable underground cable in the business.

• Kerite’s 1000 kcmil cable was selected based on its rating of 462 A @ 100% load factor.

• 2.5 MW x 6 = 15,000 kVA » 15,000 kVA/34.5 kV = 435 A

• Cost = $61.50/meter x 4,000 meters = $246,000

Supporting Documentation

Resource assessment

Resource method Wind speed

Wind speed - annual m/s 4.5

Measured at m 10.0

Wind shear exponent 0.18

Air temperature - annual °C 9.3

Atmospheric pressure - annual kPa 81.1

Wind

speed

Power

curve data

Energy

curve data

Wind turbine m/s kW MWh

Power capacity per turbine kW 2,500.0 0 0.0

Manufacturer 1 0.0

Model 2 0.0

Number of turbines 6 3 0.0 785.8

Power capacity kW 15,000.0 4 100.0 2,214.4

Hub height m 100.0 6.8 m/s 5 250.0 4,216.3

Rotor diameter per turbine m 100 6 500.0 6,417.7

Swept area per turbine m² 7,854 7 800.0 8,525.4

Energy curve data Custom 8 1,250.0 10,389.1

Shape factor 2.0 9 1,750.0 11,944.3

10 2,100.0 13,163.4

Array losses % 0.0% 11 2,300.0 14,042.2

Airfoil losses % 3.0% 12 2,400.0 14,598.7

Miscellaneous losses % 3.0% 13 2,500.0 14,868.9

Availability % 93.6% 14 2,500.0 14,899.4

15 2,500.0 14,739.8

16 2,500.0

Unadjusted energy production MWh 8,127 17 2,500.0

Pressure coefficient 0.801 18 2,500.0

Temperature coefficient 1.020 19 2,500.0

Gross energy production MWh 6,638 20 2,500.0

Losses coefficient 0.88 21 2,500.0

Specific yield kWh/m² 744 22 2,500.0

Summary 23 2,500.0

Capacity factor % 26.7% 24 2,500.0

Electricity exported to grid MWh 35,075 25 - 30 0.0

GE

Per turbine

GE Wind 2.5xl - 100m

Supporting Documentation

Questions?

References

• Colorado Springs Utilities

Henry Henderson

Pricing and Forecasting Supervisor

(719) 448 4800

• Chase Bank

Matthew Feltener

Small Business Banker

(719) 637 3253

• Colorado Wind:

Mona Newton, Central Regional Representative,

Colorado Governor's Energy Office

Phone: (303) 866-2100

• Colorado Anemometer Loan Program:

Contact: Mr. Michael Kostrzewa,

P.E., Director, Colorado Anemometer Loan Program,

Colorado State University

Phone: (970) 491-7709

• Colorado Wind Farm Incentive Program:

Program Sponsor: Colorado Department of Local Affairs, Division of Property Taxation

Website: http://dola.colorado.gov/dpt/state_assessed/docs/2007%20Cost%20Threshold%20memo.pdf