5.2. ERMUSR 08-09-2011 - Laserfiche WebLink

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EPA regazding these rules. There is no scheduled date for the EPA's reconsideration of these rules. A study has been conducted to determine ERMU's options. This study is attached for Commission review. Staff has also received a budgetary quote from a very reputable company to bring the ERMU Power Plant into compliance. The cost estimates used in the study were much higher than the quote. The study indicated total plant upgrade costs to be approximately $500,000. The quote came in for less than $175,000 to retrofit the 4 engines. The 2011 Uniform Rating of Generating Equipment (URGE) test for the power plant will result in $352,968 in compensation from GRE over the next year under the current contract. Not a114 engines would need to be retrofitted. One of the engines could run on natural gas. There aze options. The payback would be relatively short regazdless of which option the Utilities chooses. The Utilities 2011 budget included $100,000 to begin retrofitting these engines knowing that additional costs would be incurred in 2012. At this point, this 2011 capital expenditure would be delayed unti12012. The 2012 budget will include in the capital projects this carried over $100,000 plus an additional amount required to bring a114 engines into compliance with this rule. At this time it would be premature to begin any work until after the EPA has ruled on the comments submitted. ACTION REQUESTED: No action requested.