CITY COUNCIL AGENDA ITEM
ACTION REQUESTED:
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Approve the award of Bid 23-195, Electric Utility Transformer Recondition/Rebuild, to Power Electronics and Emerald Transformer PPB LLC for an amount not to exceed $300,000 and for a one-year term
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DEPARTMENT: Electric Utility
SUBMITTED BY: Brian Groth, Director
BOARD/COMMISSION REVIEW:
N/A
BACKGROUND:
Due to supply chain issues which have resulted in extended lead times and increased prices for transformers, the City of Naperville - Electric Utility (Utility) investigated and implemented alternatives to procuring new transformers including utilizing its own workforce to perform light refurbishment work, altering construction standards to serve more homes off one larger transformer, and identifying additional vendors to bid on new transformer procurements. These alternatives have been implemented by the utility to ensure new customers can be added to the system in a timely manner and that reliable power can sustainably be delivered to existing customers.
In its refurbishment pilot, the Utility focused on repairing units that were removed from service due to damage, failing an asset inspection or customer calls. This pilot was successful in that transformers were returned to the Utility in under 12 months at a cost significantly lower than that of a new transformer. These refurbished transformers were immediately redeployed to the field, replacing transformers that were identified by field inspections, customer calls and the Utility’s asset management work group as at risk for imminent failure. Replacing transformers before failure reduces unplanned system outages and reduces the cost of refurbishment because the transformer does not need to be rewound.
In July 2023, upon successful completion of the pilot program, the City issued Bid 23-195, Electric Utility Transformer Recondition/Rebuild, to identify contractors willing to inspect, recondition or rebuild single phase, pole and pad mount transformers, and three phase pad mount transformers. Several companies declined to bid due to having too much work from other utilities seeking to repair transformers.
DISCUSSION:
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Advertisement Date: |
07/27/23 |
Notices Sent: |
160 |
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Opening Date: |
08/16/23 |
Planholders: |
12 |
|
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Proposals Received: |
02 |
Bids were received from the following vendors:
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Vendor Name |
Proposed Cost |
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Emerald Transformer PPM LLC |
$488,875.54 |
|
Power Electronics |
$736,231.00 |
The City received two bids and recommends an award to both vendors. The combined award of $300,000 will be distributed between the two vendors. The Utility will control the cost through limiting the number and type of units sent for evaluation to each vendor and the estimated work needed. Each unit will be tested and evaluated by the vendor and a proposed cost and type of repair will be returned to the Utility prior to further work. Units in high demand by the Utility and with simple repairs needed, will be directed to the vendor with the shortest time to repair. Units with lower demand or known extensive rebuild requirements will be directed to the vendor with the lower cost, still taking into account return time. This is expected to balance out the work directed to each vendor. Due to proposed lead times, we do not expect any units to be returned until 2024.
The term of this contract is from date of award to August 31, 2024 with two, one-year options to extend.
FISCAL IMPACT:
CIP#: N/A
Transformer repairs are budgeted in the below Equipment Maintenance account. In 2023, $75,000 was budgeted for transformer repairs. Additionally, in 2024 the Electric Utility proposed a budget of $300,000 for transformer repairs. The requested award can be accommodated within the proposed budget.
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Account Number |
Fund Description |
Proposed Budget Amount |
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40271300-531303 |
Equipment Maintenance |
$311,500 |