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W h l 1 R F H f K G Y I I } f RIVERSIDE PUBLIC UTILITIES PUBLIC urii. 1TIE5 Board Memorandum BOARD OF PUBLIC UTILITIES DATE. December 17, 2010 ITEM NO: 8 SUBJECT: LA COLINA POWER TRANSFORMER REPLACEMENT AND AWARD OF PURCHASE ORDER FOR A POWER TRANSFORMER--SUPPLEMENTAL APPROPRIATION WORT{ ORDER NO. 1108406 ISSUE: Board of Public Utilities approval is requested to approve a purchase order for a power transformer and approve a supplemental appropriation in the amount of$500,000 to complete the project. RECOMMENDATIONS: That the Board of Public Utilities: 1. Approve the estimated capital expenditure of $850,000 for the La Colina Power Transformer Replacement 2roject; 2. Recommend that the City Council approve the award of a purchase order for one power transformer from Delta Star Inc., of San Carlos, California, in the amount of$417,030; and 3. Recommend that the City Council approve a supplemental appropriation in the amount of$500,000 from the Electric Fund Balance to the Substation Transformer Additions Project Account No. 6130000-470632. BACKGROUND: On September 29, 2010, a fig kV bushing failure on the La Colina Substation Transformer No. 4 and a malfunction of protective equipment caused a trip-out of the entire substation and the adjacent 69kV lines to Vista, University,Springs, and Orangecrest substations. The disturbance isolated La Colina Substation,and dropped thousands of customers in the area. However,within six minutes, Riverside Public Utilities(RPU) staff performed the necessary switching to isolate the problem and re-establish service to the customers. An investigation determined that, as a result of the failure, transformer bushing debris was released both external and internal to the transformer. Transformer consultants recommended shipping the forty year-old transformer to a Minnesota factory for detailed assessment. After a review of the damage to the transformer, options were developed as follows; 1) remove the debris, replace the bushings, and clean up the original transformer,2) replace bushings and rewind the original transformer, and 3) replace the original transformer with a new transformer. Option 1 was eliminated since no determination could be made on the longevity of the cleaned up unit. Therefore, an evaluation was performed for Options 2 and 3 using purchase costs, a 30-year present worth calculation for copper and core losses, delivery, and installation considerations. The results show that Option 3, a purchase of a new transformer, is the best evaluated option. See summary below: