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CRAIG PITTMANUnexpected problems with the design threatens to increase operating costs and puts contractors' bids up to $50-million.
Fixing Tampa Bay Water's troubled desalination plant will cost millions more than expected, and that could add more than $1 a month to area water bills, the regional utility announced Friday.
Two contractors bidding to fix the Apollo Beach plant initially estimated the repairs would cost no more than $14-million. But when the companies submitted their proposals this week, one put the cost at up to nearly $29-million and the other at up to $50-million.
"That's not small potatoes," fretted Pasco County Commissioner Ann Hildebrand, a longtime board member of Tampa Bay Water. Another board member, Pinellas County Commissioner Susan Latvala, said her first reaction was, "Gulp!"
More worrisome is the potentially higher cost to operate the plant over the next 30 years, said Mike Bennett, director of Tampa's water department. That will hurt water customers the most, he said.
The plant has far more problems than first thought, beginning with the design.
The increased repair and operating costs estimated by American Water Services/Pridesa could increase the average monthly bill by 72 cents, Tampa Bay Water officials said. If the board chooses American Water's competitor, Veolia North America, the monthly cost could rise by $1.12, they said.
Both companies say they can complete repairs in 18 months. That would put completion in 2006, three years after its original deadline.
"We were surprised the costs were as high as they were," said engineering manager Ken Herd. "The problems were more extensive than we originally anticipated."
Tampa Bay Water general manager Jerry Maxwell, who has overseen the project from its inception, was in Maine on vacation Friday and unavailable for comment. He was said to be surprised.
Launched in 1999, the plant is the largest in the nation. It's supposed to take 40-million gallons of bay water, force it through tightly woven membranes to screen out salt and turn it into 25-million gallons of fresh water a day.
Instead, the plant has produced headaches, bankruptcies and lawsuits galore.
The plant's original contractor, Stone & Webster, went bankrupt in 2000. Its partner, Poseidon Water Resources, then hired Covanta Energy, which also filed for bankruptcy a year later. Tampa Bay Water ousted Poseidon Water Resources but stuck with Covanta after the bankruptcy. Last year Covanta Tampa Construction, a spinoff company, went bankrupt before Tampa Bay Water could fire it.
The plant was supposed to be finished by January 2003. It wasn't. Two months later, the plant finally produced its first 3-million gallons. Local officials toasted success with plastic cups.
The celebration was premature. In May 2003, Covanta Tampa Construction flunked a crucial test of whether the plant was operational. The biggest problems seemed to be in the pretreatment process, which removes impurities before the briny water is pumped through membranes to screen out salt.
"We didn't think there was anything wrong with the rest of it," Latvala said.
Although the plant was producing near capacity, the expensive membranes were fouling far too quickly, which could wear them out too soon. Tampa Bay Water set rates based on each membrane lasting five to seven years. Replacing them more often would drive up rates.
Covanta officials blamed the clogs on Asian green mussels growing on the intake pipes at the Tampa Electric Co. power plant, which provides the water. Tampa Bay Water officials suspected the problems were with Covanta's pretreatment system.
Repeated efforts by Covanta to fix the plant failed, as relations with the utility board broke down amid charges and countercharges of who was to blame. Covanta was not the only casualty: Tampa Bay Water has sued the membrane manufacturer, two engineering companies and the companies holding a performance bond on the project, and the membrane manufacturer has sued Tampa Bay Water.
In February, Tampa Bay Water voted to pay Covanta $4.4-million to go away so someone else could fix the plant and run it for the next 30 years.
When the utility board interviewed potential contractors, St. Petersburg Mayor Rick Baker asked about projected cost estimates of $8-million to $14-million. Officials from American Water - a German-owned company that is the largest private water operator in the United States - and French-owned Veolia said that was in the ballpark.
But a third contractor predicted the fix would be far more expensive because the plant's flaws were deeper than just the pretreatment system. That contractor, a partnership between U.S.-owned Ionics and Montgomery Watson Harza, subsequently withdrew from the competition.
Tampa Bay Water paid American Water and Veolia $100,000 each to spend the summer running pilot tests at the plant. Utility officials said those tests, plus documents that Tampa Bay Water acquired after settling with Covanta, revealed serious design problems - from intake to post-treatment.
Covanta spokeswoman Beth Leytham blamed the water quality in Tampa Bay. She said Covanta is out of the picture now and would not challenge whatever action the utility takes.
Both American Water and Veolia have proposed changing pumping systems, adding new screens, modifying the chemical feed that helps clean the raw water and myriad other fixes. An independent engineering firm will review the proposals before the board meets Aug. 27. The board is scheduled to make a decision Aug. 30.
Discovering design flaws will help the utility's lawsuits, Tampa Bay Water attorney Don Conn said. The utility is trying to claim a $24-million surety bond that covers the plant's performance, as well as a $15-million insurance policy.
Utility officials said they were unaware of the problems because the contract let Stone & Webster and Poseidon Water Resources handle everything.
"If Poseidon still owned this plant, these would be Poseidon's problems, not Tampa Bay Water's," said Poseidon spokeswoman Honey Rand.