Project Green District Energy Feasibility Study - Partners in Project ...

TRCA Pearson Eco-Business Zone District Energy Feasibility Study 10 April 2012
Provision for replacement capital is the most prone to debate, as it is derived from several
parameters all of which are subject to question, (1) which equipment needs to be replaced, (2)
when, (3) how much will it cost at that time, including escalation, and, (4) how much should be
allowed each year to provide for that future outlay, given interest rates expected to be earned by
reserve fund investments.
Cost Element
Total Cost
$ per year
25
Average Unit
Energy Cost
$/MWht
% of total
Fuel $1,371,800 $48.81 65%
Operation and Maintenance $260,200 $9.26 12%
Provision for Replacement Capital $487,000 $17.33 23%
Total $2,119,000 $75.40 100%
Table 7 BaU Cost Summary
The BaU cost of this group of customers is lower that it would be for new buildings, as the
customers have already made investments in heating equipment. The overall system revenue
prospect would be improved to the extent any new development is planned on one or more of
the three development parcels; specifically, those parcels that are near the DPS route, as
shown in Figure 2, on the north side of Airport Road, just west of Highway 409, currently used
by Park n’ Fly and two on the east side of Carlingview, just north of Dixon, including the site of
the former Regal Constellation Hotel.
The positive impact of a major new development might be such as to trigger reconsideration of
this DES project should it have been shelved in the meantime.
5.2 Conceptual DES Cost Estimates
Conceptual capital costs have been developed for each of the three DES sub-systems based on
FVB’s cost database from recent, similar projects for heating and cooling.
DPS and ETS capital cost estimates for Phases 1, 2 and 3 for heating and cooling were
provided in the mid-project review Technical Memo, which is attached to this report in Appendix
I. These estimates were theoretical because of incomplete knowledge about prospective
customers, and particularly low expectations of the prospects for selling cooling to this set of
customers. They already have cooling systems installed and district cooling is mainly a capital
play in Canada, not an energy play.
A condensed summary of the DES capital costs for heating only in Phase 1 is given in Table 8
with further breakdown in following subsections. All estimates are in 2011 dollars. These
estimates are made using FVB’s proprietary DES costing models that are regularly updated with
actual costs from recent construction work awarded or completed.
System Capital Cost Estimate M$