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SC Facilities Management Workshop

SC Facilities Management Workshop Alternative (“Third Party”) Financing Plans E.T. Murphy, P.E. Brookhaven National Laboratory October 24, 2002 Alternative Financing - Background BNL has pursued private sector financed construction for many years Guest House/dormitory project, 1987

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SC Facilities Management Workshop

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  1. SC Facilities Management Workshop Alternative (“Third Party”) Financing Plans E.T. Murphy, P.E. Brookhaven National Laboratory October 24, 2002

  2. Alternative Financing - Background • BNL has pursued private sector financed construction for many years • Guest House/dormitory project, 1987 • Cogeneration, 1989 • Office building development study, 1995 • Steam Plant conversion, 1999 • Apartment area reconstruction project, 2001 • DOE/SC encouraging use of alternative financing • Institutional Plan onsite review • FY 02 and 03 contract performance measures

  3. Alternative Financing - Plans • Three major projects planned in near future • Apartment Area Reconstruction • Energy Sciences Building • Chilled Water Plant Expansion

  4. Alternative Financing – Current Status • Apartment Area Reconstruction • 70 apartment units varying from 1-4 bedrooms • 2 apartment units with 3 bedrooms with upgraded furnishings and appliances at the Director’s discretion • TEC $8 – 10M • Sited on out-leased DOE land within apartment area • Summer 2004 occupancy • RFP and facility lease in review • Internal • Input from Battelle/ORNL • RFP approval authority likely at DOE/BAO level • Targeting RFP issuance 11/02

  5. Alternative Financing – Current Status • Central Chilled Water Expansion • In-house planning team • Existing plant at 94% of peak demand; no firm capacity • Chilled Water Storage vital to handle peaks • Expansion needed to support new buildings, including Center for Functional Nanomaterials • Additional 5,000 tons needed by 2005 • Exploratory meetings with energy development companies in progress for last 5 months • Discussions with NYPA and LIPA – Total Energy Facility (Cogeneration and chilled water) • Satellite plant an interim approach • Chilled water cost would rise

  6. Alternative Financing – Current Status • Energy Sciences Building • Currently “above target” SLI FY 2004…but • Specifically encouraged by R. Orbach as alternative financed projet at Institutional Plan onsite review • 40,000sf Lab/Office; demolishes 51,000sf WWII buildings • In-house economic study in progress • Developer Workshop next 3-6 months • Likely to require mortgage guarantees; Battelle support • Battelle considering their future role in Alt Financing; decision expected by end of November 02

  7. Alternative Financing – Economics • Economics • Cost savings will be realized • Energy • Maintenance • Operations • Productivity • Net costs expected to increase • Developers desire 15 year amortization • Borrowing costs are 6-9% • Profit expectations 10-15%

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