HomeMy WebLinkAbout23-22 Decommissioning Estimate 061322
Decommissioning Net Cost
Estimate
Bartonsville Energy Facility
Project
Frederick County, Virginia
Prepared for:
Bartonsville Energy Facility Project
c/o D.E. Shaw Renewable
Investments, L.L.C.
1166 Avenue of the Americas.
New York, New York 10036
Prepared by:
Stantec Consulting Services Inc.
1165 Scheuring Road
De Pere, Wisconsin 54115
Project No: 193709001
May 31, 2022
DECOMMISSIONING NET COST ESTIMATE
BARTONSVILLE ENERGY FACILITY PROJECT, FREDERICK COUNTY, VIRGINIA
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This document entitled Decommissioning Net Cost Estimate – Bartonsville Energy Facility Project,
Frederick County, Virginia, was prepared by Stantec Consulting Services Inc. (“Stantec”) for the
use of Bartonsville Energy Facility, LLC, c/o D.E. Shaw Renewable Investments, L.L.C. (the “Client”),
and the applicable regulatory agencies. Any reliance on this document by any other third party
is strictly prohibited. The material in this document reflects Stantec’s professional judgment in light
of the scope, schedule and other limitations stated in the document and in the contract between
Stantec and the Client. The opinions in this document are based on conditions and information
existing at the time this document was published and do not take into account any subsequent
changes.
JoAnne J. Blank
Senior Associate
Matthew A Clementi, PE
Sr. Project Manager
David D Faccas, PE
License No. 402058992
State Virginia
DECOMMISSIONING NET COST ESTIMATE
BARTONSVILLE ENERGY FACILITY PROJECT, FREDERICK COUNTY, VIRGINIA
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Table of Contents
1.0 INTRODUCTION ................................................................................................................ 1
1.1 SOLAR FARM COMPONENTS .......................................................................................... 1
2.0 DECOMMISSIONING COST ESTIMATE SUMMARY .......................................................... 3
2.1 DECOMMISSIONING EXPENSES ...................................................................................... 3
2.2 DECOMMISSIONING REVENUES ..................................................................................... 4
2.3 DECOMMISSIONING COST SUMMARY .......................................................................... 5
LIST OF TABLES
Table 1 Primary Components of Solar Farm to be Decommissioned .................................. 1
Table 2 Estimated Decommissioning Expenses – with Resale of Solar Modules ................. 3
Table 3 Estimated Decommissioning Revenues – with Resale of Solar Modules ................ 5
Table 4 Net Decommissioning Summary at Year Five of Project ......................................... 5
DECOMMISSIONING NET COST ESTIMATE
BARTONSVILLE ENERGY FACILITY PROJECT, FREDERICK COUNTY, VIRGINIA
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1.0 INTRODUCTION
Bartonsville Energy Facility, LLC (Bartonsville Energy), a subsidiary of D.E. Shaw Renewable
Investments, L.L.C. (DESRI), is proposing to construct the Bartonsville Energy Facility Project
(the Project) in Frederick County, Virginia.
The Project will occupy approximately 1,300 acres of land (within perimeter fencing) and
will have a nameplate generating capacity of approximately 170 megawatts (MW)
direct current (DC).
The decommissioning phase is assumed to include the removal of Project facilities,
including perimeter fencing; solar arrays and associated racking/trackers, foundations,
and steel piles; inverters and transformers; access and internal roads; electrical collection
system; and one Project substation with two main power transformers.
Summaries of estimated costs and revenues associated with decommissioning the
Project within the first five years of Project life are included in Section 2.0. The summary
statistics and estimates provided are based on a 170-MW[DC] Project array design.
Bartonsville Energy has indicated they will provide an updated decommissioning cost
estimate prior to the fifth anniversary of Project commissioning, to account for changes
in cost and revenue predictions at that time.
1.1 SOLAR FARM COMPONENTS
The decommissioning phase is assumed to include removal of the main components of
the Project as listed in Table 1.
Table 1 Primary Components of Solar Farm to be Decommissioned
Component Quantity Unit of Measure
Solar Modules (approximate) 319,000 Each
Tracking System (full equivalent trackers) 4,090 Tracker
Steel Piles 45,482 Each
Inverter and Transformer Stations 41 Each
Above and below ground Electrical Collection
Cables (approximate) 252,000 Lineal Foot (estimated)
Perimeter Fencing (approximate) 79,000 Lineal Foot (estimated)
Internal Access Roads (approximate) 144,180 Lineal Foot (estimated)
Substation (two transformers) 1 Each
Components of the solar facility that have resale value may be sold in the wholesale
market. Components with no resale value will be salvaged and sold as scrap for recycling
or disposed of at an approved offsite licensed solid waste disposal facility (landfill). The
resale value of solar modules is calculated for the first five years of the Project life,
DECOMMISSIONING NET COST ESTIMATE
BARTONSVILLE ENERGY FACILITY PROJECT, FREDERICK COUNTY, VIRGINIA
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although they will likely have resale value beyond that time. Estimated revenue for the
balance of the components is based on salvage value of the material scrap.
Decommissioning activities will include removal of the arrays and associated
components as listed above.
DECOMMISSIONING NET COST ESTIMATE
BARTONSVILLE ENERGY FACILITY PROJECT, FREDERICK COUNTY, VIRGINIA
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2.0 DECOMMISSIONING COST ESTIMATE SUMMARY
Expenses associated with decommissioning the Project will be dependent on labor costs
at the time of decommissioning. For the purposes of this report 2022 average market
values were used to estimate labor expenses. Fluctuation and inflation of the labor costs
were not factored into the estimates.
2.1 DECOMMISSIONING EXPENSES
Project decommissioning will incur costs associated with disposal of components not sold
for salvage, including materials which will be disposed of at a licensed facility, as
required. Decommissioning costs also include backfilling, grading, and restoration of the
proposed Project site. Topsoil retained on the site from Project construction will be utilized
to restore access road areas. Table 2 summarizes the estimates for removal and
restoration activities associated with the major components of the Project within the first
five years of Project life, assuming resale of solar modules.
Table 2 Estimated Decommissioning Expenses – with Resale of Solar Modules
Activity Unit Number Cost per
Unit Total
Overhead and management (includes
estimated permitting required) Lump Sum 1 $851,000 $851,000
Solar modules; disassembly and removal
(for resale) Each 319,000 $9.00 $2,871,000
Tracking system disassembly and
removal Each 4,090 $625 $2,556,250
Steel pile/post removal Each 45,482 $9.70 $441,175
Transformers/Inverters Each 41 $1,820 $74,620
Buried cable removal Linear Feet 252,000 $0.83 $209,160
Access road excavation and removal Lump Sum 1 $957,350 $957,350
Perimeter fence removal Linear Feet 79,000 $2.80 $221,200
Access road and site rehabilitation Lump Sum 1 $734,000 $734,000
Substation removal (2 transformers) Lump Sum 1 $450,000 $450,000
Total estimated decommissioning prior to contingency and shipping $9,365,755
Contingency Lump Sum 1 $468,000 $468,000
Estimated shipping costs of modules for
resale Each 319,000 $4.00 $1,276,000
Total estimated decommissioning cost (resale of modules) $11,109,755
DECOMMISSIONING NET COST ESTIMATE
BARTONSVILLE ENERGY FACILITY PROJECT, FREDERICK COUNTY, VIRGINIA
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2.2 DECOMMISSIONING REVENUES
Revenue from decommissioning the Project will be realized through the sale of the solar
facility components and construction materials. Resale of components such as solar
panels is expected to be greater than salvage (i.e., scrap) value for most of the life of the
Project, as described below. For purposes of this report, a conservative estimate of the
resale value of solar modules is presented for the first five years of Project life.
Modules and other solar plant components can be sold within a secondary market for
re-use. A current sampling of reused solar panels indicates a wide range of pricing
depending on age and condition ($0.10 to $0.30 per watt). Future pricing of solar panels
is difficult to predict at this time, due to the relatively young age of the market, changes
to solar panel technology, and the ever-increasing product demand. A conservative
estimation of the value of solar panels at $0.10 per watt would yield $17,000,000.
Increased costs of removal, for resale versus salvage, is considered in order to preserve
the integrity of the panels; however, the net revenue would be substantially higher than
the estimated salvage value. A conservative estimate of module resale value, using a
straight-line depreciation of five percent per year, is presented in this report. The final
value considers a seven percent loss of panels due to damage during removal and
handling, along with the increased costs of handling and shipping of modules for resale.
The resale value of components such as trackers, may decline more quickly; however,
the salvage value of the steel that makes up a large portion of the tracker is expected
to stay at or above the value used in this report. The substation will realize revenue from
the steel components and main power transformers. The resale value of the substation in
the fifth year of Project life will be substantially greater than the estimated salvage value
in this estimate.
The market value of steel and other materials fluctuates daily and has varied widely over
the past five years. Salvage value estimates were based on an approximate five-year-
average price of steel and copper derived from sources including on-line recycling
companies and United States Geological Survey (USGS) commodity summaries. The price
used to value the steel used in this report is $241 per metric ton, considering shipping
costs.
Table 3 summarizes the potential resale value for the solar modules and salvage value
for other components and construction materials.
DECOMMISSIONING NET COST ESTIMATE
BARTONSVILLE ENERGY FACILITY PROJECT, FREDERICK COUNTY, VIRGINIA
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Table 3 Estimated Decommissioning Revenues – with Resale of Solar Modules
Item Units Quantity
per Unit
Value
per
Unit1
Total
Value
per Item
Number
of Items2
Total
(Value at
100%)
Total
(Value at
90%)3
Module Resale
Revenue – Year Five
Watts per
Module 530 $0.0775 $41.08 296,670 $12,187,204 $10,968,484
Tracking System and
Posts (salvage value)
Metric
tons per
MW[DC]
32.0 $241 $7,712 170 $1,311,040 $1,179,936
Substation Components (steel and transformers) $150,000 $135,000
Total Potential Revenue – Year Five $13,648,244 $12,283,420
15.0% depreciation rate per year (2.5% first year)
2Approximate 7% damage rate at time of removal
3 Ninety percent of total estimated value
2.3 DECOMMISSIONING COST SUMMARY
Table 4 provides a summary of the net estimated cost due to decommissioning of the
Project, using the information detailed in Sections 2.1 and 2.2. Estimates are based on the
value of components on the fifth anniversary of Project commissioning. Late 2021 to early
2022 labor and equipment rates were used, with no market fluctuations or inflation
considered.
The net decommissioning summary includes the expected net decommissioning revenue
based on 100 percent of the expected value of components and at 90 percent of
expected value.
Table 4 Net Decommissioning Summary at Year Five of Project
Item 100 Percent
of Revenue
90 Percent of
Revenue
Decommissioning Expenses Prior to Contingency and
Module Transportation for Resale $9,365,755 $9,365,755
Contingency $468,000 $468,000
Transportation of Modules for Resale $1,276,000 $1,276,000
Total Gross Estimated Decommissioning Costs $11,109,755 $11,109,755
Revenue Considering Resale of Modules at Year 5 $13,648,244 $12,283,420
Net Decommissioning Revenue/(Cost) $2,538,489 $1,173,665