Title
Approval of Agreement No. AGR26-60 with Black & Veatch Corporation in an Amount Not to Exceed $551,775.00, and a Contingency of $75,000.00, plus New Mexico Gross Receipts Tax, for the Purpose of Engineering Services for the Abiquiu and El Vado Hydroelectric Condition Assessment for the Term of One (1) Year & Approval of Budget Revision 2027-20
Recommended Action
I move that the Board of Public Utilities recommend to Council, a Contract for General Services, Agreement No. AGR26-60 with Black & Veatch Corporation in an amount not to exceed $551,775.00, and a contingency of $75,000.00, plus $48,183.33 in New Mexico Gross Receipts Tax, having the total amount of $674,958.33, for the Purpose of Engineering Services for the Abiquiu and El Vado Hydroelectric Condition Assessment for the term of one (1) year, with the County’s sole option, to renew the agreement for up to one (1) consecutive year, unless sooner terminated.
I further move that the Board recommend Budget Revision 2027-20 and forward both to Council for approval.
Utilities Manager's Recommendation
The Utilities Manager recommends that the motion be approved as presented.
Body
The Abiquiu and El Vado Hydroelectric facilities are vital components of the County’s clean energy infrastructure. Because these plants generate critical revenue and renewable power, keeping them running smoothly is a top priority. If a major turbine or generator suffers a catastrophic breakdown, the County faces severe consequences, including extreme emergency repair bills, months of waiting for custom parts, and a massive loss of power revenue while the plant sits idle. To prevent these issues, this contract will hire Black & Veatch Corporation to perform a thorough health check on our equipment and provide a clear ten-year list for future investments. The ultimate goal of this project is to figure out whether it makes more financial sense to fix our aging equipment or replace it entirely with modern, high-efficiency upgrades, while giving us a compliant plan to budget for these expenses over the next decade.
At the Abiquiu facility, the contractor will perform technical inspections on all three original generation units and their support systems. This work includes running advanced electrical health tests on the wiring and checking the backup battery banks to see how many years of service life they have left. The consultant will also measure and analyze known cracks on Turbine Number One using specialized testing to tell us if it is safe to keep running.
For the El Vado facility, the focus shifts to inspecting the backup batteries, control valves, and support systems. Because the Bureau of Reclamation has a major dam restoration project coming up, this contract also includes a special study to see if it makes sense to temporarily pause operations at El Vado. Black & Veatch will look at the exact costs to safely shut down the plant during construction and outline what it will take financially and operationally to restart it later.
To keep the project focused and save money, the County has set strict boundaries on what the contractor will look at. The engineers will completely bypass the plant computer systems, the station cranes, and the main step-up transformers at both sites. They will also skip any equipment at El Vado that was already refurbished during the upgrades back in 2016 and 2017.
Alternatives
The main alternative is to do nothing and skip the study. While this saves money right now, it forces us to just wait for something to break. Without this inspection, a major piece of equipment could fail without warning. The unexpected repair bills and lost power revenue would cost drastically more than this study. Doing nothing also means we would have no financial plan for the future of these power plants.
Fiscal and Staff Impact
This contract will be managed on a strict not-to-exceed basis of $551,775.00, and a contingency of $75,000.00, plus $48,183.33 in New Mexico Gross Receipts Tax, having the Total amount of $674,958.33. The money required for this assessment will consist of a $350,000 carry forward from FY2026, and a budget revision for FY2027 will be needed for the remaining $324,959.00 (See Exhibit C of financial summary).
Attachments
A - AGR 26-60 Black & Veatch Corp.
B - Budget Revision 2027-20
C - Financial Summary