Timothy R. CookGolder Associates Inc.

Plant Closure Workshop November 12, 2009

Decommissioning/Demolition:Overview of Demolition Management Process

Background

Golder Associates Inc. conducted a study for the Electric Power Research Institute and Exelon to document a systematic approach to decommissioning fossil-fueled power plants. Publication is forthcoming for the report on the study, titled Decommissioning Process for Fossil-Fueled Power Plants.Intent is to provide the Owner or Operator of a plant nearing the end of its operational life with an overview of the key elements necessary to successfully implement a decommissioning project.Objectives for “decommissioned” site:

• Minimal risk to health & safety• Compliance with laws• Minimal liability to present or future owners

• Minimal environmental impacts• Suitable for post-decommissioning land use objective• Aesthetically acceptable to community

Staged Approach to Decommissioning.

Staged Approach ( objective driven )

Helps Owners manage the “process” of facility closure with anemphasis on strategic planning, liability management, safetyenhancement, cost management, and aligning project scope withtheir business objectives.

1Project Framing

2Site Characterization

3Rem. & Rec. Planning

5Project Closure

4Implementation

Terminology

Decommissioning:To render a plant or building “inert”

Demolition:Removal of aboveground and underground structures

Other common terms:DeactivationDeconstructionAbatementRemediationClosureDismantling

Staged Approach to Decommissioning / Demolition Process Management

Value to Owner Safety programs are strictly followedCost certaintyContractor contingency is reduced by minimizingunknownsMaximizes asset value returned to Owner Contractor is responsible but “fail-safe” gates arein-placeOwner has assurance of proper waste managementOwner and Contractor share in public/agency relations

The Decommissioning / Demolition Management “Process”

1. Strategic Planning: Information to allow decision-making and set-up

2. Pre-Work Preparation: Technical and contractual preparatory tasks to facilitate successful implementation

3. Project Implementation: Execution and project control / compliance

4. Project Closure: Documentation

1

2 3

4

5

Step 1 - Strategic Planning

End use scenarios / exit strategies

Project estimating / value-understanding

Asset evaluation - redeployment or sale

Historical use research - site use history

Contract Set-up

HR & PR issues / Permitting

Sequencing and Prioritizing tasks anddeveloping timelines

Focus on: End use scenario / exit strategies

Basis for all key decisions!What is the business transaction?What is the overall objective of demolishing site? Considerations for Owner: marketability, utilities, safety, liability, PR, environmental, holding costs, corporate protocols, labor (union) issues, site use history, long-term securityObtain consensus of “stakeholders”Describe / show how site will look at end

Example

4.7M square feet under roof, operated from 1950s to 2007.

Site still heated, managed, and maintained despite no plans for re-use.

Owner’s exit strategy was not developed

Fluctuating real estate and scrap metal markets complicated unstructured planning by Owner.

Golder compiled pertinent information (holding costs and action costs) and prepared in a structured matrix format to better evaluate exit strategy options. Completed a value analysis of each end use scenario for 2, 4, and 8 year projections.

Owner used information for making business decision and forward planning.

Closed Manufacturing Facility, Midwest (US)

The Key is to know what information is needed to obtain the best scenario snapshot without incurring extensive investigations and engineering fees.

Step 2 – Pre-Work Preparation

“Regulated Materials” Survey (aka “haz-mat survey”)

Environmental Site Assessments (surface / subsurface)

Engineering: Utilities, storm management, permitting, etc.

Contract documents and technical specifications for work (“performance-based”)

Contractor procurement

Evaluation of contractor bids

Understand governinglaws and ordinances

Develop integrated plan for remedial actions

Step 3 – Project Implementation

Contractor submittal review

Document contractor compliance with specifications andregulations

Liaise with agencies and public on behalf of Owner

Review of waste management records

Administrative assistance anddata management

Inspections: environmentalclearance and general completion

Step 4 – Project Closure

Contractor permit close-outs / regulatory reporting

Document “As-built” surface and subsurface conditions

Archive waste management records

Project closure report – synopsisof major project activities

Facilitates transition intoproperty end use

Decommissioning / demolition cost estimating tool (experience based)

End-use scenario value analysis tool

Asset portfolio prioritization tool

Topics for Further Research