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W A I E N E ,, l 1 I RAIERSIDE PUBLIC UTILITIES ld& Board Memorandum P U B L I C U r I L [ i I E 5 BOARD OF PUBLIC UTILITIES DATE: October 21, 2010 ITEM NO: 7 SUBJECT: APPROVAL OF SECOND AMENDMENT TO PROFESSIONAL SERVICES AGREEMENT WITH POWER ENGINEERS, INC. ISSUES: Board of Public Utilities approval is requested for. 1) the second amendment to the Professional Services Agreement (Agreement) with Power Engineers, Inc.; 2) an increase in the change order authority for the Agreement; and 3) an increase to the work orders for the Riverside Transmission Reliability Project (RTRP) and Caltrans. RECOMMENDATIONS: That the Board of Public Utilities: 1. Approve the Second Amendment to the Professional Services Agreement with Power Engineers, Inc., extending the term of the Agreement an additional five years from December 31, 2011 to December 31, 2016, and increasing the amount of the Agreement from $10,868,741 to $12,433,327; 2. Approve an increase in the change order authority for the Agreement from 15% to 25%; 3. Approve an increase to Riverside Transmission Reliability Project (RTRP) Work order No. 050009 from $15,027,603 to $16,558,613; and 4. Approve an increase to Caltrans Work Order No. 1022588 from $2,393,030 to $2,426,606. BACKGROUND: RTRP For many years, the Board of Public Utilities and City management have expressed concerns that the source of electric energy supply for Riverside Public Utilities (RPU) has been through only one (1) connection to Southem California Edison's (SCE) Vista Substation. This concern was substantiated on October 26, 2007 when all seven (7) 89,000-volt subtransmission lines serving the City from Vista Substation were interrupted and the City was without electricity, with some parts out for several hours. Separate and distinct from the City's dependence on a single SCE substation, there is also the need for additional capacity to serve the electric demand of RPU customers as the City's demand continues to grow beyond the limited capacity at Vsta. In 2005, SCE performed studies that indicated the need for construction of a double-circuit 230 kilovolt (kV) transmission line into the City of Riverside and a new 230 kV interconnection substation (Wildlife Substation). In June 2006, the California Independent System Operator directed SCE to build the line and substation as soon as possible. The interconnection substation is proposed to be constructed adjacent to a new RPU 560-megawatt substation called Wildemess Substation. RPU owns the site for both proposed substations which is near the northeasterly comer of Wiidemess Avenue and Ed Perkic Street. In addition, RPU proposes to build new 69 kV subtransmission lines to complete the connection of Wilderness Substation to the existing electrical network.