The Water Authority will spend millions of dollars on a new desalination plant in Lower Valley, replacing the present 16-year-old facility and providing 800,000 US gallons per day by mid-July next year.
In a recent request for proposals, the statutory unit asked interested companies to submit proposals to completely refurbish Lower Valley’s treatment plant, commissioned in 1997, installing up-to-date computer systems and twin processing facilities.
The successful bidder will have 10 months to complete the new plant, operating it for three months before turning it over to the authority.
“Because it’s a competitive tender, I don’t want to say too much about costs,” says Water Authority Deputy Director Tom van Zanten. However, he estimates that the price will “run into the millions.”
The funding will not depend on borrowing or government subsidies, avoiding the kind of scrutiny mandated by the Framework for Fiscal Responsibility, pressed on local government in November 2011 by previous minister for overseas territories Henry Bellingham.
Two of the clauses sought to limit borrowing and to improve the performance of statutory authorities, concerns Mr. van Zanten dispelled.
“The project will be funded from retained earnings. No additional loans will be necessary,” he told the Caymanian Compass.
Four plants in operation
The authority operates four desalination plants, producing 4 million US gallons of potable water daily, serving 17,000 customers, most of which are households and businesses.
The Red Gate facility produces 5,000 cubic meters each day; the North Sound plant makes 6,000 cubic meters daily; the North Side operation near the Botanic Garden on Frank Sound Road, the largest of the four, desalinates 9,000 cubic meters every 24 hours. By contrast, Lower Valley produces 3,000 cubic meters. One cubic meter of water is 1,000 liters or 264.2 US gallons.
Bids are due at noon, Jan. 15, the same day they will be unsealed by the Central Tenders Committee. The winner will be notified within 60 days. Mr. van Zanten expects most of the submissions will be from North American contractors
“The successful contractor will have 280 days, 40 weeks,” to build the new facility on the site of the old one, a concrete block off Shamrock Road, he said. “Although the building itself only requires limited cosmetic work, most of the plant equipment has reached the end of its useful life and will need to be replaced.”
His assessment raises the specter of a rolling – and expensive – refurbishment program, rebuilding each plant as it ages.
“The short answer to that is: possibly,” Mr. van Zanten said. “All mechanical equipment has a finite life expectancy, and as [desalination] technology improves, the economic life expectancy of equipment may become less. However it may be that in the future, equipment will be replaced as required, i.e., piecemeal, instead of the entire plant as a whole.”
The 1,800-square-foot Lower Valley facility may have been worked to death.
Its original capacity – 1,500 cubic meters per day at its 1997 opening – was half of current output. In 1999 the authority doubled its capacity, pushing the plant to its limits.
“Due to the rapidly expanding water-distribution system and the associated increase in demand,” Mr. Van Zanten said, “the plant had to consistently produce water close to its design capacity, leaving little opportunity for preventative plant maintenance.”
In early 2006, he said, Lower Valley “was expanded and refurbished,” reaching 4,000 cubic meters per day. In 2009, the authority opened the North Side Water Works, easing the strain on Lower Valley, which was “de-rated” to 3,000 cubic meters.
The contractor for the new plant must supply housing for imported labor and is contractually bound to reduce electricity consumption, a significant expense. All materials must be guaranteed for one year but are expected to be productive for 15 years.
The plant will shut as work progresses, but Mr. van Zanten said that should not affect production or customer service.
“The present plant will be out of service for two or three months while the upgrade takes place,” he said, but “the Water Authority has sufficient spare water-production capacity at the remaining three plants to service its customers.”