Since mid-May, the eight turbines of Competitive Power Ventures’ Sentinel power plant just north of Palm Springs have been turning on and off, each one possibly up to twice a day, pumping vitally needed power onto the grid and unwanted pollution into the air. But seven months after the South Coast Air Quality Management District approved $51 million in grants for projects across the Coachella Valley to offset emissions from the natural gas peaker plant, the money is only now starting to trickle into the region. Of 26 projects the AQMD board chose Jan. 4 to receive a chunk of the Sentinel funds, six have signed contracts, seven have received contracts that have yet to be signed and 13 are waiting. Not a single project is complete. “I’ve been calling them every two weeks. They won’t let us do anything until we have a signed agreement,” said David Barakian, public works director for Palm Springs, which will eventually use its $1,175,225 Sentinel grant to install solar panels on a number of community buildings. Barry Wallerstein, AQMD’s executive officer, explained the long turnaround times on some of the contracts as the combined result of the uniqueness of the projects, the diversity of organizations involved and the varying grant amounts. Palm Springs is one of eight organizations still awaiting contracts for solar projects, each of the installations different and requiring detailed, time-intensive contract negotiations, Wallerstein said. “It’s not a cookie-cutter statement of work for the overwhelming majority of contracts,” he said. “It is a large number of contracts to be executing in a period of time. We have to make sure the wording in the contract is explicit enough so that the desired outcome is well-defined for the recipient of the project and for what the public will receive. “At the end of the day, the proposals don’t contain all of the language you need in a contract. They have to be translated into language for the contract. That does require going back and forth with folks so that there is no misunderstanding,” he said. The Desert Sands Unified School District has a signed contract for its $650,000 grant and has already ordered five cleaner, propane-burning buses that will replace the same number of older diesel-powered vehicles used to transport special education students, said Rick Majors, director of maintenance, operations and transportation. He expects the new buses to be on the road by mid-September. Riverside County also has a signed contract for $4,097,114 it will use for paving and dust control at 31 small mobile home parks in the east valley, but Supervisor John J. Benoit doesn’t expect any work to begin until next summer. “We had to wait until we got the contract to bring on the additional staff to start the process, to start doing the specific design work,” said Benoit, who also sits on the AQMD board. The district will have to sign off on any contractors or subcontractors the county hires to work on the project, he said — a requirement that will likely apply to many grantees and could further slow down the cash flow. The Mission Springs Water District is another organization awaiting a contract for a solar project, but spokesman John Soulliere said the AQMD board approved only $3.3 million of the $9.8 million the agency requested, and downsizing the project has slowed contract negotiations. Other organizations receiving funds have their own standard contracts, which can mean more time and negotiations, Wallerstein said. He expects the remaining 13 contracts to be ready for signatures within 30 days. Echoing many officials still waiting on contracts and money from the district, Benoit said he would like to see the Sentinel funds hitting the ground faster, but was reluctant to criticize the AQMD or compare it with other grant-making organizations. “I’m sure the AQMD could be accused of being more bureaucratic than others,” Benoit said. “Their contract is more detailed and (has) more checks and balances than most, but you can’t do it sloppier or quicker. They do it right, but it does take time.” Others note that funding practices and contract turnarounds vary widely across agencies. Some of the Sentinel grant recipients, such as the Coachella Valley Association of Governments, are also grant makers, managing a range of million-dollar federal projects, but they may not write contractor approval or similar project-slowing provisions into their contracts. “CVAG has agreements to build the interchanges on the I-10; those contracts can involve tens of millions of dollars,” said Tom Kirk, executive director. “We have a boiler-plate contract. We certainly have some oversight, however most of those engaged in doing the work have all sorts of internal controls, audit procedures and are very familiar with the bid process so we don’t want to create additional burdens.” The organization’s standard turnaround time for contracts on such projects is about five months, he said, but the unprecedented and high-profile nature of the Sentinel grants justifies the AQMD’s extra time and caution. “There is so much political pressure riding on these things and getting it right that they’re being super careful,” added Elizabeth Versace, a consultant who wrote proposals for three projects receiving funds in Desert Hot Springs — a dust control initiative, a solar installation and the purchase of compressed natural gas vehicles. “The AQMD is doing the very best they can with their resources. I think they got way more than they bargained for with this project, and they’re playing catch-up.” Wallerstein said the Sentinel contracts have come on top of negotiations for other AQMD grant contracts, but the agency’s main concern is accountability. “We’ve treated these contracts in a standard manner,” he said. “We’re potentially going to get audited; we’re going to do our job to make sure the public dollars are invested wisely.” Unique challenges Almost since its inception, the Sentinel plant has presented the valley and government agencies such as the AQMD with a series of unique challenges spawning equally unprecedented solutions. At the height of the recession, the $900-million natural gas plant was pitched as a jobs creator and much-needed backup for the intermittent electricity produced by the valley’s wind and solar projects. The lump-sum $51 million is the result of a special law, authored by Assemblyman V. Manuel Pérez, D-Coachella, in 2009, when the plant became mired in a lawsuit filed by environmental groups challenging the AQMD’s process for selling emissions credits. The case was not targeted at Sentinel but stalled the permitting process for the project. Pérez’s solution, Assembly Bill 1318, was specifically written to allow the district to sell credits to the plant, but earmarked the $53-million proceeds for air quality improvement projects. The law required 30 percent of the funds to go to areas within a six-mile radius of the plant, 30 percent for “environmental justice” areas — regions with low-income populations and high cancer risks — and the remaining 40 percent to be awarded at the AQMD board’s discretion. The district takes a 5 percent cut for administration, which left about $51 million for grants. Although it was not required in the law, Benoit convinced the board that all funds should be used in the Coachella Valley and, along with Pérez, pushed hard to extend grant proposal deadlines and offer extra technical assistance to make sure smaller, nonprofit groups across the region could apply for and receive the funds. Pérez has been out of the valley on vacation, but said he will call the AQMD this week for an update on contract delays. The district received 75 grant proposals, scoring each on its projected pollution reductions, cost efficiency and social benefits such as job creation. The final list of 26 grants ranged from $53,995 for a CNG vehicle for St. Elizabeth of Hungary’s Food Pantry in Desert Hot Springs to the $17.4 million going to CVAG for its CV Link, a 52-mile cross-valley pedestrian, bicycle and neighborhood electric vehicle trail. The six projects that have signed contracts to date are either for paving or dust control efforts, traffic signal synchronization or the purchase of CNG or propane vehicles — the kind of projects district staff has done many times before. “It has been our normal process with them in other grants,” said Majors, who has been through previous funding cycles for bus replacement projects with the district. “They used tools from other grants; they pulled the same language and requirements.” Wallerstein said his staff has previously negotiated grant contracts for solar installations, but some of the Sentinel projects are new ground for them, such as two grants totaling more than $3.4 million to provide home energy retrofits for low-income families. “The staff is making sure we get what was advertised and the interaction with any (rebate) program the Gas Company or Edison would have is appropriately accounted for,” he said, referring to rebates for energy-efficient equipment offered by the two utilities. “They want to make sure there’s no double counting and what’s being done is complementary.” On the question of whether and how the district will monitor the projects to ensure they actually offset emissions from the plant, he is more uncertain. Since the Sentinel plant went online May 15, two and a half months ahead of the Thursday start of its 10-year contract with Southern California Edison, Competitive Power officials said the time one or more of its turbines have run has steadily increased. The plant ran about 20 hours in May and about 200 in June, said Mark McDaniels, asset manager for Sentinel. July figures are not yet final, he said, but he expects them to show between 300 and 400 hours of operation. “A lot of our dispatches will give us 15 minutes to get units online,” he said. “It’s been a lot of real-time dispatch, several units a day, coming on late in the afternoon and running for several hours. It’s nothing out of the ordinary for a peaking plant.” Edison officials said they will continue to bid the plant into day-ahead and hour-ahead markets for the grid, providing backup power at times of high demand, but were mum on whether it might be used to fill gaps in power supplies left by the permanent shutdown of the San Onofre nuclear power plant in June. Sentinel’s permit from the California Energy Commission assumes it will operate a maximum of 2,803 hours per year, adding up to 1 million tons of carbon dioxide and 112,000 pounds of particulate matter, a significant cause of lung disease, into the valley’s air. So far, the only emissions reports Competitive Power has filed with the AQMD are for nitrogen oxide, or NOx, a pollutant that contributes to the formation of ozone. During its testing phase earlier this year, from February to April, the plant emitted about 8,954 pounds of nitrogen oxide. In May, emissions dropped to 792 pounds and in June to 316 pounds. On other emissions, the plant will submit quarterly and annual reports to the AQMD, district spokesman Sam Atwood said. How those emissions will balance with pollution reductions from the Sentinel mitigation projects may be difficult to track because of the high levels of pollution coming into the valley from the ports of Los Angeles and Long Beach, traffic on Interstate10 and other outside sources, Wallerstein said. Rather, he said, the projects should be measured by the immediate impacts they have on the lives of Coachella Valley residents. “If we look at paving or treating a road, you’re going to be able to go out and talk to the residents,” he said. “They will be able to tell you the difference it’s made.” Energy reporter K Kaufmann can be reached at (760) 778-4622, k.kaufmann@thedesertsun or on Twitter @kkaufmann.
Posted on: Wed, 07 Aug 2013 01:14:36 +0000
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