CT2018-833 Approval Letter - Laserfiche WebLink

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Southeastern Colorado Water Conservancy District Agenda Item 13a July 20-21, 2016 Board Meeting(Updated July 22, 2016) Page 3 of 6 activities, and to administer the sale and management of water including the Fry-Ark return flows. The enterprise itself has no taxing authority. Its revenues primarily come from charges for services and water sates. Water Rights The District has rights to import water from the western slope through Fry-Ark. Over the past 25 years, average annual diversions have been approximately 48,000 AF per year. Of that diversion, 12% is reserved for domestic use in municipalities east of Pueblo. This has averaged 5,760 AF per year and is the water that is expected to be conveyed through the AVC. Pursuant to the Reclamation Repayment Contract, the District, through the water activity enterprise, retains dominion and control over all Fry-Ark return flows. These flows can be exchanged back up to Pueblo Reservoir, providing up to an additional 1,600 AF of water per year. Project Description The proposed Project is the construction of a 7.5 MW hydroelectric facility that will utilize the existing outlet flows from Pueblo Dam to the Arkansas River and will act as a run-of-river plant so that operations will not change existing flows or dam releases. The powerhouse will be located approximately 500 feet downstream from the North Outlet Work's fixed cone valve facility and adjacent to a Reclamation water supply pipeline. The turbines will discharge into the Arkansas River below Pueblo Dam. The turnouts for the powerhouse are located on the Southern Delivery System (SDS) pipeline and were built during the SDS pipeline construction in anticipation of a future hydroelectric power plant at this location. CH2M, Mountain States Hydro, and the District performed alternative analysis for potential turbine sizing. Alternative 1 - No Action: This alternative was considered undesirable. With Reclamation's solicitation for hydropower on Pueblo Dam, the District is in the unique position of developing a local revenue source for the AVC project, thereby assisting communities in the Lower Arkansas River Basin. No action by the District would result in Reclamation awarding the final LOPP to the other applicant who proposes to sell the electricity to a power provider located in Salt Lake City. Alternative 2 - Equally Sized Turbines: Advantages of having equally sized turbines primarily include easier maintenance as the operator would not need different spare parts and tools for each turbine, as well as a possibility for a smaller powerhouse footprint. However, equally sized turbines are less able to capitalize on a variable hydrograph as compared to unequally sized units. The District determined the added energy production from unequally sized turbines more than offset benefits of equally sized turbines and therefore did not choose this alternative Selected Alternative 3 - Unequal Sized Turbines: The District determined unequally sized turbines offer a higher energy benefit. Preliminary designs show the use of three turbines (4,000 KW Turbine 1 at 450 cfs, 2,600 KW Turbine 2 at 260 cfs, and 900 KW Turbine 3 at 100 cfs) would provide the most energy generation potential over the widest range of flows at an average of 28,000,000 kWh per year. Project components will include: (1) connection to the existing North Outlet Works turnouts; (2) 125 ft of 73-inch diameter penstock; (3) three Francis turbines with associated generators and electrical gear; (4) A 75 ft by 100 ft powerhouse located along the bank of the Arkansas River; and (5) 6,100 LF of underground and overhead power lines and associated switchgear. The cost associated with this alternative is $19,060,000 as shown in Table 1. The District is near finalizing a Power Purchase Agreement (PPA) with Colorado Springs Utilities at a rate of $0.052 cents per kWh and a 2.5% escalation per year for the term of the agreement. The PPA will be a 20-year