BOARD MEETING DATE: August 6, 2004
AGENDA NO. 12

Reissue RFP for Demonstration of Natural Gas, Stationary Fuel Cells in South Coast Air Basin

SYNOPSIS:

In April 2003, the Board awarded two contracts to install stationary fuel cells. Unfortunately, both awardees are unable to conduct the projects as originally proposed. Staff still believes that stationary fuel cells are an important clean fuel technology and should be demonstrated in the South Coast Air Basin. This action is to reissue RFP to solicit proposals for installing and operating stationary fuel cells at a cost not to exceed $1,000,000 from Clean Fuel Fund.

COMMITTEE:

Technology, July 23, 2004, Recommended for Approval

RECOMMENDED ACTION:

Approve issuance of RFP # P2005-05 to demonstrate stationary fuel cells in the South Coast Air Basin in an amount not to exceed $1,000,000 from the Clean Fuels Fund.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

As part of an effort to promote the development, demonstration, and commercialization of near-zero emission technologies, the Board approved release of RFP #P2003-12 at its October 4, 2002 meeting to solicit cost-shared proposals to design, install, and operate natural gas, stationary fuel cell units within the South Coast Air Basin. On April 4, 2003, the Board awarded two contracts under RFP #P2003-12 to California Cast Metals Association (CCMA) and UTC Fuel Cells (UTCFC). The contracts, however, could not be executed because (1) CCMA and its partner submitting the proposal have since dissolved their business relationship and (2) UTCFC could not deliver the proton exchange membrane fuel cell units as projected in the proposal. Staff still believes that stationary fuel cells are an important part of AQMD’s near-zero emission strategy to meet the air quality objectives of the 2003 AQMP. As such, staff is requesting the Board to re-issue RFP #P2003-12 as RFP #P2005-05.

Proposal

This RFP will solicit proposals to install natural gas, stationary fuel cell units within the South Coast Air Basin to provide clean electric power and supplemental heating where applicable. The proposed RFP facilitates installation of stationary fuel cells to accelerate commercialization, gain operational experience, develop a reliability database, and achieve public awareness of the efficiency and air quality benefits of this clean air technology.

Proponents will be required to provide pre-packaged, modular units that can dispense electric power, and heat where applicable, to the host site. In addition, proponents will be required to provide for protection and security of the fuel cell installation, ensure at least 75% availability of power average over a year, a minimum of 2-year warranty which could include a preventive maintenance contract, and submit data gathered by a third-independent party to determine, at a minimum, emissions, efficiency, operation data, maintenance data, and durability data.

Outreach

In accordance with AQMD’s Procurement Policy and Procedure, a public notice advertising the RFP/RFQ and inviting bids will be published in the following publications:
 

1.	Antelope Valley Press	11.	La Opinion	21.	Rafu Shimpo
2.	Black Voice News	12.	La Prensa Hispana	22.	San Bernardino Sun
3.	Chinese Daily News	13.	La Voz Publications	23.	State of California Contracts
4.	Desert Sun	14.	Los Angeles Daily News		Register
5.	Eastern Group Publications	15.	Los Angeles Sentinel	24.	The Daily Breeze
6.	El Chicano	16.	Los Angeles Times	25.	The Excelsior
7.	El Informador	17.	Orange County Register	26.	The Signal
8.	Inland Empire Hispanic News	18.	Philippine News	27.	Wave Community Newspapers
9.	Inland Valley Daily Bulletin	19.	Precinct Reporter
10.	Korea Central Daily	20	Press Enterprise

Additionally, potential bidders will be notified utilizing the Los Angeles County MTA Directory of Certified Firms, the Inland Area Opportunity Pages Ethnic/Women Business & Professional Directory; and AQMD’s own electronic listing of certified minority vendors. Notice of the RFP/RFQ will be mailed to the Black and Latino Legislative Caucuses and various minority chambers of commerce and business associations, and placed on the Internet at AQMD’s Web site (http://www.aqmd.gov where it can be viewed by making menu selections "Inside AQMD"/"Employment and Business Opportunities"/"Business Opportunities" or by going directly to http://www.aqmd.gov/rfp/index.html). Information is also available on AQMD’s bidder’s 24-hour telephone message line (909) 396-2724. Staff will also conduct outreach efforts to specific sectors, such as transportation providers, construction and building industry, and port operations.

Bid Evaluation

Proposals received will be evaluated by a diverse, technically qualified panel, according to criteria contained in the attached RFP.

Benefits to AQMD

The proposed project is included in the 2003 Advanced Air Pollution Research Plan under item D-12, "Demonstration of Commercial and Large Scale Fuel Cells," and the 2004 Technology Advancement Plan Update under "Fuel Cell Technology – Demonstrate Stationary Fuel Cells for Residential, Commercial, and Industrial Applications."

The AQMP promotes the expedited implementation of advanced technologies and clean burning fuels in Southern California to achieve air quality standards. The proposed RFP will demonstrate the technological feasibility of near-zero emission fuel cells. As these projects demonstrate commercial viability, the technology will increase in acceptance and lead to increased orders, decreased costs, and eventual widespread application. The impact of higher efficiency, lower polluting energy production will substantially reduce emissions in the South Coast Air Basin.

Resource Impacts

The total amount of AQMD funding for this program shall not exceed $1,000,000. Sufficient funds are available from the Clean Fuels Fund, established as a special revenue fund resulting from the state-mandated Clean Fuels Program. The Clean Fuels Program, under Health and Safety Code Sections 40448.5 and 40512 and Vehicle Code Section 9250.11, establishes mechanisms to collect revenues from mobile sources to support projects to increase the utilization of clean fuels, including the development of the necessary advanced enabling technologies. Funds collected from motor vehicles are restricted, by statute, to be used for projects and program activities related to mobile sources that support the objectives of the Clean Fuels Program.

Attachment

RFP #P2005-05 - Demonstration of Natural Gas, Stationary Fuel Cells in the South Coast Air Basin

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