Capacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc October 19, 2006 

### Capacity Expansion Study
For The Gowanus and Narrows Generating Stations

Prepared For Astoria Generating Company, L.P.
400 Madison Avenue New York, New York 10017

Prepared by Burns and Roe Enterprises, Inc.
800 Kinderkamack Road Oradell, NJ 07649Capacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc October 19, 2006 TABLE OF CONTENTS

1.0 Introduction and Methodology 2.0 Conceptual Layouts 2.1 Narrows Conceptual Layouts 2.2 Gowanus Conceptual Layouts 3.0 Preferred Layout Options 3.1 Narrows Barge Option 3.2 Gowanus South Pier Options 4.0 Indicative Cost Estimates 4.1 Gowanus Land based Options 4.1.1 Basis and Assumptions 4.1.2 Order of Magnitude Installed Costs 4.1.3 Comparative Plant Installed Costs 4.1.4 Supplemental Pricing Information 4.2 Narrows Power Barge Option 5.0 Thermal Performance Estimates 6.0 Emissions Performance Estimates 7.0 Electrical Interconnection and System Impacts 8.0 Other Information and Data
Appendix 1: Conceptual Layout Sketches Appendix 2: The Power Barge Corporation Budgetary Quote Appendix 3: Coflex “Technip” Flexible Pipe InformationCapacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

1 1.0 Introduction and Methodology In accordance with Task Order No. 001 between Astoria Generating Company, L.P. (Astoria) and Burns and Roe Enterprises, Inc. (BREI) dated July 27, 2007, BREI has completed a Conceptual Capacity Expansion Study to assist Astoria in developing an overall capacity expansion strategy for the Gowanus and Narrows Generating Stations; and to identify any critical hurdles that must be overcome to facilitate adding capacity at these sites. The scope of this study included the following individual tasks: a) BREI conducted an evaluation of both sites considering survey data and existing equipment layouts to identify available onshore and pier locations that would be suitable for new barge and/or land based capacity additions. b) Based on this evaluation, six layout concepts were developed for each site considering both land and barge options. The objective of this evaluation was to determine the maximum reasonable level of capacity that could be installed at each site while considering construction, operation, and maintenance requirements, maintaining the existing barge generation capacity in service, and independent of possible electrical export or gas delivery constraints. These concepts considered the use of either GE LM6000 “Sprint”, GE LMS100, or Pratt & Whitney’s FT8 “SwiftPac” combustion turbine generator sets. c) Following a joint Astoria/BREI review of these layout concepts, three options were selected by Astoria for further evaluation (land based at Gowanus and barge mounted at Narrows). These options include: a.) three LM6000’s at Gowanus, b.) one LM6000 and one LMS100 at Gowanus, c) double LM6000 barge mounted units at Narrows. d) BREI then developed Order of Magnitude comparative cost estimates, performance estimates, and stack emissions estimates for each of these selected options. e) A recommended approach was developed for Astoria to evaluate the ability of the ConEd electrical grid to accept additional capacity from Gowanus and/or Narrows without congestion; and to identify what system upgrades may be required, and at what cost, to evacuate the full additional electrical capacity identified in this study. f) Report to Astoria any other pertinent information and data identified during the course of this study. 2.0 Conceptual Layouts Following a site inspection visit and initial kickoff meeting, BREI prepared conceptual layout drawings for adding generation capacity considering the following basic requirements: First, all existing Frame 5 barge based c apacity is to be kept in operation both during construction of the new facility and once the new capacity goes into operation. The newCapacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

2 combustion turbines would be of simple cycle configuration with dual firing capability utilizing natural gas and No. 2 fuel oil. Water injection, high temperature SCR and CO catalysts will be required for control of NOx and CO emissions. No new No. 2 Oil storage capacity will be provided; the existing barge and land based storage facilities (Gowanus and Narrows respectively) will provide adequate fuel oil storage capacity for both the existing and new capacity. Demin water (for NOx control and LM6000 “Sprint” intercooling injection) will be produced in trailer mounted rental DI plants with offsite resin regeneration. The Electrical interconnections are assumed to be located at the plant existing ConEd tie points at an export voltage of 138kV. Gas is assumed to be available at 300 psig at the site battery limits. The following Combustion Turbines were considered in this evaluation: GE LM6000 “Sprint” (nominal 48 MW), Pratt & Whitney’s 52 MW “Swiftpac”, and the GE LMS100 intercooled combustion turbine (nominal 100 MW capacity). Due to balance of plant plot space requirements, the LMS 100 was only considered for land based applications. The following provides a summary of the layout concepts developed during this phase of the study. Copies of BREI’s layout sketches are included as Appendix 1 of this Report. 2.1 Narrows Conceptual Layouts 1. Option 1 (BREI Sketch No. SKM-200): Pratt & Whitney Swiftpac (2xFT8’s with a common generator) located in the area of abandoned mounded fuel oil tanks, gas compressor located adjacent to the existing gas metering house (nominal 52 MW capacity). 2. Option 2 (BREI Sketch No. SKM-201): Two GE LM6000 Sprint units located in area of abandoned mounded fuel oil tanks, miscellaneous support equipment in abandoned fuel oil unloading area. (nominal 96 MW capacity). 3. Option 3 (BREI Sketch No. SKM-202): One GE LM6000 Sprint located in the area of the abandoned fuel oil unloading area with miscellaneous support equipment near area of abandoned mounded fuel oil storage tanks. (nominal 48 MW capacity). 4. Option 4 (BREI Sketch No. SKM-203): One GE LM6000 Sprint barge mounted with barge moored to a new “T” shaped pier extension at the west end of the existing pier. The ammonia tank, gas compressor and demin trailers would be located onshore in the abandoned fuel oil unloading area. Demin water storage would be on the barge or as an alternate, land based. (nominal 48 MW capacity). 5. Option 5 (BREI Sketch No. SKM-204): Two barge mounted LM6000 Sprint units moored to a new “T” shaped pier extension. The two CTG’s would be mounted on either a single barge or two barges transported separately and then mechanically joined. The ammonia tank, gas compressors and demin trailers would be located onshore in the abandoned fuel oil unloading area. DeminCapacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

3 water storage would be on the barge (or as an alternate, land based) (nominal 96 MW capacity). 6. Option 6 (BREI Sketch SKM-205): Two LM6000 Sprint units mounted on separate barges and moored to the north and south sides of a new east - west pier extension. The ammonia tank, gas compressors and demin trailers would be located onshore in the abandoned fuel oil unloading area. Demin water storage would be on the barge (or as an alternate, land based) (nominal 96 MW capacity). 2.2 Gowanus Conceptual Layouts 1. Option 1A and 1B (BREI Sketches SKM 210, Sheets 1 and 2): Two alternate configurations for locating three LM6000 Sprint units located in the South Pier area with adjacent balance of plant (nominal 144 MW capacity). 2. Option 2 (BREI Sketch SKM 211): Combination of one LMS100 unit and one LM6000 Sprint (with common stack) located in the South Pier area with adjacent balance of plant (nominal 148 MW capacity). 3. Option 3 (BREI Sketch SKM 212): Two barge mounted LM6000 Sprint units on single or double joined barges with land based facilities located on the South Pier (nominal 96 MW capacity). This barge location would require demolition and removal of submerged spoils reported to be located west of the south pier. 4. Option 4 (BREI Sketch SKM 213): Four barge mounted LM6000 Sprint units on multiple joined barges with land based facilities located on the South Pier (nominal 192 MW capacity). This barge location would require demolition and removal of submerged spoils reported to be located west of the south pier. Further evaluation of the feasibility of the fabrication and transport of this barge configuration would also be required. 5. Option 5 (BREI Sketch SKM 214): Two barge mounted P&W Swiftpac units on multiple joined barges with land based f acilities located on the South Pier (nominal 102 MW capacity). This barge location would require demolition and removal of submerged spoils reported to be located west of the south pier. Further evaluation of the feasib ility of the design and transport of this barge configuration would also be required. 6. Option 6 (BREI Sketch SKM 215): Two LM6000 Sprint units located one the south and one to the north of the existing administration and control building (nominal 96 MW capacity). These units could be either barge mounted or placed in filled areas. This option would require further evaluation of water depth, dredging requirements, and the feasibility (permitability) of land filling these areas to support a land based installation.Capacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

4 3. Preferred Layout Options Based on a joint review of the layout concepts described in Section 2 above, Astoria selected two land based options at Gowanus and barge mounted options at Narrows for further evaluation, including the development of Order of Magnitude cost estimates. The selected concepts include: a) three LM6000’s at Gowanus, b) one LM6000 and one LMS100 at Gowanus, and c) two LM6000 barge mounted units at Narrows. The evaluation criteria considered for selecting these concepts included:

x The Gowanus “South Pier” area provides an open area without existing encumbrances for the placement of approximately 140 - 150 MW of new capacity. It may be possible to expand this area to the west by landfill to provide room for an additional LM6000 bringing the additional capacity of this option up to approximately 192 MW.

x Barge siting at Gowanus presents many challenges as compared to Narrows. Issues include the possible need to dredge and remove submerged spoils, the need to relocate existing fuel barges, interference concerns with existing barges, and the possibility of “land locking” existing power barges with the installation of new power barges.

x The onshore areas at Narrows would be of higher cost and riskier to develop for CTG installation as compared to the Gowanus South Pier. This is due to the need to remove the abandoned mounded fuel tanks and other structures. The close proximity of local businesses and residence, permitting and noise control requirements, and community relations, further complicates onshore siting options at Narrows.

x New barge placement at Narrows is more attractive than at Gowanus considering the relative ease of new pier construction and open water access for new barge placement. Barge placement would require only limited onshore balance of plant equipment installation in the area of either the abandoned mounded fuel oil tank or fuel unloading area. Conceptual layout and design details (developed to the extent necessary for the purpose of layout space allocation) for the preferred Narrows and Gowanus options include the following: 3.1 Narrows Barge Options The extent of Astoria’s water rights (south and west of the existing power barges), and the need to maintain barge access to the fuel unloading pier north the existing power barges, limits the amount of barge capacity that can be installed. BREI has determined that a maximum of two barge mounted LM6000’s can be accommodated given these constraints.Capacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

5 Two pier configurations were considered including a “T” shaped extension at the end the existing pier and extending the existing pier to the west. With the pier extension, two separate power barges would be moored, one on either side of the pier. With the “T” configuration, either a single dual LM6000 barge or two rafted barges (mechanically joined after shipment) would be moored in the north - south direction. While BREI believes that there may be some nominal cost savings associated with the “T” configuration, the east-west pier extension has been selected for this study. This is based on several factors including Astoria’s preference; and better on-pier accessibility for barge, turbine, and generator maintenance. The pier extension would be approximately 50’ wide by 200’ in length to accommodate two nominal 200’ X 80’ barges. Details of utility routing (gas, oil, water, ammonia) on both the new and existing piers will be determined in future detailed design studies. Located on each barge would be an LM6000 Sprint with fuel oil and water injections skids and associated mechanical and electrical modules, exhaust breeching with high temperature SCR and CO catalysts, exhaust stack, ammonia dilution and vaporization skid, GSU transformer with secondary containment, electrical switchgear and MCC equipment, CEM’s system and enclosure, air compressor equipment, fin fan coolers and associated glycol/water based cooling water pumps (for generator and lube oil cooling), oil water separators and other required pollution control equipment. Dematerialized water storage would be provided either on the barge or on shore. Due to corrosion concerns, on-barge demin water storage would be provided in a separate tank located under deck. Refer to BREI Sketch Drawing SKM-205, Sheet 1, for this arrangement. Associated on shore supporting equipment including the aqueous ammonia storage tank, gas compressors (one for each LM6000) and demineralized water trailers would be located in the area near First Avenue where the retired truck fuel oil unloading area is located. The gas compressors would be installed in a building for noise control. Each gas compressor would be provided with a fin fan cooler. The LM6000 e requires gas in the range of 650-700 psig, with a flow of approximately 7500 scfm. Given dual fuel capability, redundant gas compression was not included. Ammonia storage for the SCR would consist of a horizontal ASME Section VIII pressure tank, approximately 12,000 gallons capacity which would be provided with secondary containment. A 19% solution of aqueous ammonia, considered acceptable to the NYFD would be used. Aqueous ammonia delivery would be adjacent to First Avenue. Demin trailer parking would also be accessible from First Avenue. It is envisioned that a new gas supply line may need to be routed to the site. The line will require a capacity of approximately 15,000 scfm in order to handle two (2) LM6000’s. For this study, and for gas compressor sizing estimates, it is assumed that natural gas would be available at a nominal 300 psig Each LM6000 would require approximately 45 gpm of demineralized water for water injection. A city water line to handle a capacity of approximately 100 gpm with a minimum interface pressure of 60 psig will be required. The 60 psig pressure requirement considersCapacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

6 pressure losses for the cation/anion/mixed bed vessels located on the demineralized water trailers. If this pressure cannot be provided raw water booster pumps would need to be provided. Fuel oil consumption for each LM6000 is approximately 40 gpm. Therefore, an additional flow of 80 gpm from the existing tankage will be required for two (2) LM6000’s. Based on current fuel oil storage capability at Narrows, this should not be an issue. New fuel oil forwarding pumps and transfer piping are assumed to be required. Refer to BREI Sketch Drawing SKM-205, Sheet 2, for the suggested onshore equipment arrangement. 3.2 Gowanus South Pier Options LM6000 Sprint Option The preferred option for the Gowanus “South Pier” site includes three (3) individual LM 6000 Sprint’s as shown on BREI Sketch # SKM-210, Sheet 2. Each LM 6000 unit would incorporate a high temperature SCR and CO catalyst system with individual 80’ (nominal) exhaust stacks. A CEMS system would be provided for each stack. Each SCR module would be provided with its own ammonia dilution skid. It should be noted that SCR dilution air injection for SCR cooling is not required with the LM6000 exhaust gas temperature (nominally 800F - 850F). Two (2) storage tanks for 19% aqueous ammonia, each with a capacity of approximately 12,000 (each) gallons would be provided onsite. Four (4) ammonia forwarding pumps, one (1) for each LM 6000 and one (1) common spare would be provided. An air compressor building would be provided with two (2) 100% capacity oil free rotary screw air compressors, one (1) twin tower dryer and one (1) vertical air receiver. Space has been allocated for two (2) demineralized water trailers and one (1) field erected demineralized water storage tank. Four (4) demin water forwarding pumps would be provided, one (1) pump per machine plus one (1) common spare. Three (3) 100% capacity gas compressors, each with its own fin-fan cooler, would be provided and located adjacent to the existing gas metering station. It is envisioned that all three (3) gas compressors would be located in an enclosed building for noise control. Given dual fuel capability, redundant gas compressors were not included. The Gowanus plant was provided with natural gas capability during the 1990’s. Gas lines are run to barges #3 and #2 and there is a stub up connection blanked off for future connection to barge #1. Therefore, it appears that there is sufficient remaining natural gas supply capacity for this option. However, gas compression will be required. Utility requirements for each LM 6000 unit are approximately as follows:

x #2 fuel oil 40 gpm
x demineralized water injection 45 gpmCapacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

7 x natural gas 7500 scfm at a pressure range of 650 to 700 psig A Control Building would be provided on site to serve as the Control Room facility for each LM 6000 as well as for the Balance of Plant (BOP) equipment. The Control Room would be provided with a Distributed Control System (DCS) for overall supervisory control. LMS100 / LM6000 Sprint Option The second land based option for Gowanus includes one (1) LMS100 and one (1) LM 6000. The LMS 100 machine is rated at a nominal 100 MW, total output for this option would be approximately 148 MW. This configuration is shown on BREI Sketch # SKM-210, Sheet 2. The site configuration considerers the LMS 100 and LM6000 sharing a common stack to conserve space and capital cost. Auxiliary support systems would be similar to those provided the 3 x LM6000 configuration except the LMS100 intercooler heat exchanger requires the addition of an evaporative type mechanical draft cooling tower in order to achieve the higher simple cycle efficiencies. While the LM/LMS offers the benefit of higher efficiency and slightly higher site output when compared to the LM6000 only option, the following tradeoff’s need to be considered when comparing these benefits to the LM6000 based configuration:

x Loss of commonality of combustion turbine and generator spare parts.

x The LMS100 requires higher gas supply pressure and therefore a larger and different gas compressor (compared to the LM6000). Common sparing of gas compressors or parts is not feasible.

x The LMS100 is a new generation machine with the first unit just entering commercial operation (Groton Generation Station, South Dakota). As such, insurance underwriters will most likely consider the first units to carry prototype or new technology risk premiums resulting in higher premiums, higher deductibles and the possibility of additional policy coverage exclusions for at least the first 8,000 hours of successful commercial operation.

x The LMS100 HPC intercooler heat exchanger requires a mechanical draft evaporative cooling tower versus fin-fan coolers to maintain equipment efficiency. The approximate heat rejection duty for this cooling system is 125,000,000 Btu/hr. The estimated city water make-up water and blow down requirements for the cooling tower are on the order of 265 gpm and 50 gpm respectively.
4.0 Indicative Cost Estimates 4.1 Gowanus Land Based OptionsCapacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

8 4.1.1 Basis and Assumptions Based on the Gowanus land based layout concepts developed in this study, Burns and Roe has developed indicative order of magnitude installed cost estimates for the following combustion turbine configurations: 1. A base line single GE LM6000 located in the Gowanus South Pier area. 2. Three GE LM6000’s with common balance of plant facilities located in the Gowanus South Pier area. 3. A single LM6000 and single GE LMS100 with common balance of plant facilities located in the Gowanus South Pier area. The Thermoflow Inc. GT PRO "PEACE" cost estimating module was utilized as a screening tool to develop baseline indicative cost estimates for these configurations. The PEACE generated cost estimates were then validated for the Gowanus site specific requirements by: 1. Adjusting the equipment lists and equipment costs based on expected balance equipment scope and recent procurement experience. 2. Adjusting the labor rates and productivity factors to reflect current experience with NYC craft. 3. Increasing engineering, procurement, commissioning and start-up budgets based on our recent involvement on the FPL Jamaica Bay (Queens, NY) Pratt & Whitney Swiftpac project. 4. Developing discount factors to reflect multiple unit savings that may be realized by sharing common balance of plant equipment; and from engineering and construction economies. 5. Comparison with other recent NYC peaker installations. Burns and Roe estimates that the level of accuracy of the estimates included in this report are on the order (-) 15% / +30%. The major basis and assumptions included in these estimates include the following:

x Use of GE LM6000 “SPRINT” and LMS100 packaged CTG’s with dual fuel packages.
x High temperature SCR and CO catalyst package with nominal 80' stack.
x No new oil tankage, but with new fuel oil forwarding pumps and new fuel oil transfer piping (from the barges).
x Single 100% gas compressor for each CTG based on a minimum 300 psig suction pressure.Capacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

9 x Separate 138 kV step-up transformers for each CTG.
x Balance of electrical switchyard adjacent to the CTG package.
x Allowance provided for new buried power cables from the high side of the step-up transformers to the location of the existing ConEd switchyard.
x Demin water produced in a trailer mounted rental demin plant.
x Gas interconnect on the South Pier adjacent to the CTG location.
x Mechanical draft cooling tower (LMS100 only).
x No special foundation requirements with spread footings assumed.
x Contractor’s costs, including fee and profit of 10% based on a turn-key fixed EPC price and fixed schedule contract.
x Purchase of the CTG’s by USPG/Astoria and turn-over of this equipment to the contractor at NTP for erection and commissioning.
x Separate guarantees provided by GE for CTG performance and delivery; and from the EPC contractor for BOP aux loads, and completion schedule.
x Pricing based on a late 2006 EPC NTP without escalation (present day).
Costs not included in Burns and Roe’s estimate include:

x Budget cost for initial CTG spare parts stocking.
x Initial cost (paid to GE) should Astoria elect to join either the GE lease engine program or engine rotable component program.
x Other Owners costs including:
o Interest During Construction
o Legal and other financial costs
o Gas/Electric utility interconnection and offsite utility system upgrade costs
o Owners Engineering costs, administration costs, and development fee
o Land or Right-of-Way purchase costs 4.1.2 Order of Magnitude Installed Costs Single GE LM6000 “SPRINT” Installation For the Single LM6000 and associated BOP located on the Gowanus "South Pier", BREI estimates the order of magnitude installed cost to be on the order of $850/kW based on a nominal net plant output of 48 MW. Multiple LM6000 “SPRINT” Installation Using the single LM6000 estimate as a baseline, BREI developed discount factors to reflect multiple unit savings that may be realized by sharing common balance of plant equipment; and from engineering and construction economies. One factor not considered in this evaluation is the possibility that Astoria may be able to negotiate a multiple unit discount with GE for the purchase of multiple LM6000’s and/or LMS100’s.Capacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

10 To develop a baseline discount factor, BREI developed a list of balance of plant equipment that can be readily shared by multiple units (air compression, water treatment, tankage and piping systems) with dedicated CEMS, gas compression, and electrical systems for each individual CTG. The estimated savings that may be realized with this level of equipment sharing plus engineering and construction economies is on the order of 7% to 10%. The resulting order of magnitude installed cost estimate is from $765/kW to $790/kW for the 3 X LM6000 configuration. Further savings may be possible with further sharing of equipment that might include the gas compressors, CEM systems, step-up transformers and other hi-voltage equipment. However, to determine the feasibility of these additional savings, a more detailed preliminary design study would first need to be completed. LM6000 “SPRINT” Plus LMS100 Configuration For the Single LMS100 and associated BOP located on the Gowanus "South Pier", BREI estimates the order of magnitude installed cost to be on the order of $790/kW based on a nominal net plant output of 96MW. In combination with an LM6000, and without considering a multiple unit discount, the blended cost of the LM6000/LMS100 plant would be on the order of $810/kW based on a nominal output of 144MW with the same level of estimate accuracy as noted above. While a multiple unit balance of plant discount sh ould also apply in this case, BREI does not recommend applying a discount factor for this configuration at the conceptual level of design development. This recommendation is based on a variety of factors including, most importantly, the higher level of construction and engineering cost uncertainty due to the very limited industry experience base with the LMS100; and the different BOP support requirements for both units. 4.1.3 Comparative Plant Installed cost Estimates As part of our cost estimate development, BREI compared the estimates developed for Astoria to two NYC peaking plants that have been installed within the past 5 years, including the 11 NYPA LM6000 peakers and the FPL Jamaica Bay (Queens) Pratt & Whitney 52 MW Swiftpac which are further described below. Based on this comparison, and considering the general downward trend in pricing for this type of CTG peaker installation since 2000 - 2001, the cost estimates developed for this study appear to be within reason, and is possibly conservative. FPL Jamaica (Queens) Bay Peaking Plant Burns and Roe provided both detailed design & engineering, and procurement services to FPL during their execution of the Jamaica bay peaking plant. FPL self performed this project acting as General Contractor. Burns and Roe is in the position to provide certain order of magnitude information on this project as follows:Capacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

11 x The project was completed in October, 2003. Given the fall completion timing, FPL was not facing a peak season in-service deadline, and the project was constructed without owner directed construction acceleration. This can force pricing up as a result of overtime costs and productivity losses, and was a significant issue that plagued the NYPA projects.

x Major equipment was purchased in the 2001 time frame at the tail end of the peak of the power construction boom, but before there were significant reductions in major equipment pricing. Combustion turbines prices have come down by as much as 20% since that point in time. However, the construction contracts were negotiated and entered into during the industry down.

x Jamaica Bay is very similar to the land based Gowanus option, but with the use of a Pratt & Whitney 52 MW Swiftpac instead of the LM6000. The project included dual fuel firing with both high temperature SCR, CO catalyst, gas compression, etc. However, there were some significant differences including oil new storage and the upgrading of an unloading pier for oil barge receipt.

x The project, being within the NYC city limits, was constructed by the same union locals as the NYPA peakers and future additions at Gowanus or Narrows. When adjusting the Jamaica Bay scope to make it consistent with a single LM6000 at Gowanus, the installed price was in the $840/kW to $880/kW range. However, as FPL self performed, contractors soft cost are not fully refl ected in this price. Total project cost including the oil unloading pier, unloading facilities, oil tankage, and other costs was reported to be some 10% to 20% higher. Project construction and labor relations during construction were relatively uneventful. However, there were some issues with IBEW Local 3 which required that prefab electrical console terminations (part of the Swiftpac package that had been wired in Pratt & Whitney’snon-union fabrication shops) be un-terminated when the equipment arrived onsite, and reterminated in the field. This underscores the need to develop and maintain a good relationship with local craft before the project, and if at all possible to negotiate a Project Labor Agreement (PLA) before the project commences to address this type of issue before project execution. NYPA In-City Peaking Plants The New York Power Authority (NYPA) constructed 11 LM6000 peakers at 7 locations (6 in-city and one on Long Island) that went into service in June, 2001. The projects were constructed with Slattery Skanska as General Contractor and DMJM Harris acting as Project and Construction Manager; the published cost was $1,080/kW. However, most intelligence indicates that actual price with field change orders may have been as high as $1,300 to $1,400/kW. These costs do not include NYPA’s soft costs or land costs.Capacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

12 When comparing the NYPA projects to a future project at Astoria, several factors must be considered. First, both equipment purchases and construction contracts were negotiated and entered into in the 2000 - 2001 time frame at the peak of the power construction boom when turbine prices alone were 20% to 25% above current pricing (a nominal $70/kW - $90/kW premium over today's prices for the CTG's alone based on LM6000 pricing). Further, NYPA did not receive its NYDEC Air Quality Permits to Construct until February of 2001. With a June, 2001 summer peak period in-service obligation, the project was faced with extremely short 5 month construction schedules at 7 independent locations from the time of initial earth work to Commercial Operation. This forced a very aggressive 7X24 hour around the clock construction effort in parallel at multiple sites. As a result, labor productivity was much lower than expected and significant construction cost overruns resulted. Therefore, it is difficult to directly compare the NYPA projects to Astoria, or to consider them indicative of future in-city project pricing trends. 4.1.4 Supplemental Pricing Information
Incremental Cost For Pile Foundations As an installed cost sensitivity, BREI developed an order of magnitude cost estimate for the incremental cost for pile foundations at the Gowanus site (in lieu of spread footings which forms the basis for the estimates presented above). This estimate is based on the Jamaica Bay Project which is located on fill with very poo r soil bearing capability. With the Pratt & Whitney Swiftpac foundation loadings being similar to those for an LM6000, this provides a good basis for a comparative order of magnitude estimate; and probably represents a worst for Gowanus since all major equipment including tanks, gas compressor stack, SCR, and CTG at Jamacia Bay required pile foundations. The incremental cost is on the order $1.3MM over that for spread footings for a single LM6000 based project. For the LMS 100 BREI would recommend using $2MM as an order of magnitude incremental cost. For reference, and not necessarily representative of the Gowanus foundation design requirements, 250 X 70' auger cast piles were installed at Jamaica Bay at a cost of roughly $74/foot. Major Equipment Indicative Pricing The Following table provides a summary of the indicative major equipment costs for both the LM6000 and LMS100 100 based plant configurations. The data as presented has been extracted from the GTPRO PEACE cost estimates; and while representative, cannot be compared directly to the installed cost estimates included in this report. Prices are FOB, Jobsite, based on current pricing without escalation.Capacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

13 Table 4.0 Indicative Equipment Pricing Plant Configuration 1 X LM6000 1X LMS100 1.0 Specialized Equipment 1.1 Combustion Turbine $15,120,000 $34,800,000 1.2 SCR, CO Catalyst & Stack $ 2,760,000 $ 5,150,000 1.3 Fuel Gas Compressors $ 635,000 $ 1,375,000 1.4 CEMS System $ 385,000 $ 385,000 1.5 Distributed Control System $ 325,000 $ 420,000 1.6 Step-Transformer $ 725,000 $ 1,250,000 1.7 Other High Voltage Equipment $ 200,000 $ 950,000 1.8 Buried High Voltage Cable $ 2,300,000 $ 3,400,000 1.9 Cooling Tower (LMS100 only) $ 685,000 2.0 Other Equipment $ 950,000 $ 1,300,000 Total Equipment $23,400,000 $49,715,000

4.2 Narrows Power Barge Cost Estimate In order to develop an order of magnitude cost estimate for new power barges at Narrow’s, BREI develop separate cost estimates for the power barge itself and for the onshore balance of plant components including the pier extension. For the power barge, budgetary pricing for new deck barge fabrication and outfitting with an LM6000 Sprint was obtained from The Power Barge Corporation who is a power barge outfitter with substantial LM6000 outfitting experience, located in Houston, Texas. A copy of their proposal and power barge outfitting qualifications and experience is included in As Appendix 2 of this Report. Their budgetary price of $650/kW ($31,200,000 per barge based on a nominal 48MW output) includes the following: 1. New construction of a deck barge of approximately 200’ X 80’ at a non-union gulf coast yard. 2. Full outfitting (installation) of equipment on the barge by union craft at the gulf coast yard. The installation would carry full union tags and stamps. The scope of equipment installed on the deck barge would include: a. LM6000PC Sprint Dual fuel package b. LM6000 inlet filter house c. LM6000 skid mounted equipment including fin fan coolers, water injection skid, oil skid, fire protection systems, etc. d. Air compressors and driers e. High temperature SCR/CO catalyst module and 80' stack f. SCR ammonia dilution and vaporization systemCapacity Expansion Study Gowanus and Narrows Generating Stations

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14 g. CEMS h. Step-up transformer (138 kV) with secondary oil containment i. High voltage take-off structure j. MCC’s, electrical switchgear and local controls k. Below deck demin water storage tank l. Pollution control equipment for the barge including oil water separator 3. Wet towing from the gulf coast fabrication yard to Brooklyn, New York.

The on shore balance of plant components and services include: 1. Gas compressors, compressor building and coolers 2. Ammonia offloading facilities and ammonia storage tank 3. Balance of the high voltage equipment 4. Demin trailer parking area and demin water storage tank 5. Onshore ammonia, water and fuel oil forwarding systems 6. Onshore high voltage power export, auxiliary power and controls cabling, ammonia, oil, and water piping and barge interface facilities 7. Onshore facilities engineering and construction costs 8. Commissioning and Start-up support services 9. Nominal 50’ X 200’ pier extension The costs for this equipment and services, excluding the pier, were extracted from the onshore equipment estimates developed for Gowanus as described in Section 4.1. The estimated turnkey cost for the onshore equipment component including construction, engineering, commissioning/start-up support for a two barge project is estimated to be on the order of $18,000,000 which includes a $5,000,000 allowance for designing and constructing the pier extension. The resulting all-in order of magnitude cost for the two power barge project at Narrows is $80,400,000, or $837/kW based on a nominal output of 96 MW.
5.0 Thermal Performance Estimates BREI developed thermal performance estimates for both the LM6000 Sprint and LMS100 at the Gowanus/Narrows site conditions at the ambient temperatures requested by Astoria (Tables 5.1 and 5.2 below). In developing these estimates, BREI obtained the most recent cycle deck data from GE Energy to develop gross performance estimates at the generator terminals. The GT PRO performance estimating software was then run to develop estimated plant auxiliary loads (including transformer losses, gas compression, fans, pumps and other balance of plant equipment), and net plant performance estimates. LMS100 auxiliary loads also include the intercooler heat rejection system’s relatively substantial cooling tower fan and circulating water pump loads.Capacity Expansion Study Gowanus and Narrows Generating Stations

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Table 5.1 GE LM6000 Sprint Estimated Performance Fuel Type Natural Gas #2 Fuel Oil

Ambient Conditions 30F 40%RH 60F 60%RH 90F 60%RH 30F 40%RH 60F 60%RH 90F 60%RH Gross Power (kW) 50,807 48,454 42,627 50,784 47,031 42,165

Net Power (kW) 49,593 47,370 41,642 50,030 46,293 41,470 Plant Aux. Loads (kW) 1,214 1,084 985 754 738 695 LHV Gross Heat Rate (BTU/kWh) 8,374.8 8,538.0 8,712.8 8,469.2 8,634.7 8,841.5

LHV Net Heat Rate (BTU/kWh) 8,579.9 8,733.4 8,918.9 8,596.9 8,772.5 8,989.7

Fuel LHV Input (mmBTU/h) 425.5 413.7 371.4 430.1 406.1 372.8

Table 5.2 GE LMS100PA Estimated Performance Fuel Type Natural Gas #2 Oil

Ambient Conditions 30F 40%RH 60F 60%RH 90F 60%RH 30F 40%RH 60F 60%RH 90F 60%RH Gross Power (kW) 101,154 102,567 96,569 101,508 99,660 89,007

Net Power (kW) 96,072 97,443 91,588 97,255 95,417 84,831 Aux.& Losses (kW) 5,082 5,124 4,981 4,253 4,243 4,176 LHV Gross Heat Rate (BTU/kWh) 7,773.3 7,841.7 8,001.5 7,817.1 7,922.9 8,146.6

LHV Net Heat Rate (BTU/kWh) 8,184.5 8,254.1 8,436.7 8,159.0 8,275.3 8,547.6

Fuel LHV Input (mmBTU/h) 786.3 804.3 772.7 793.5 789.6 725.1

Burns and Roe Enterprises, Inc. October 19, 2006

15Capacity Expansion Study Gowanus and Narrows Generating Stations

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16 6.0 Emissions Performance Estimates Turbine exhaust and post control stack emissions estimates for both the LMS100 and LM6000 Sprint are summarized in Tables 6.1 and 6.2 below. In developing these estimates, BREI obtained the most recent cycle deck data from GE Energy to develop the turbine exhaust emissions estimates. The post control stack emissions estimates are based on GE provided data considering the use of both high temperature SCR and CO catalysts. While GE does not guarantee stack emissions, data provided is repr esentative of the level of control being required for these CTG’s in recent air permits. While GE has stated that SCR and CO catalyst vendors are willing to guarantee this level of control, further direct discussions with catalyst vendors are recommended. It should be noted that in the case of both the LMS100 and LM6000, turbine exhaust temperature is low enough (in the 750F to 850F range), such that dilution (cooling) air injection is not required to temper the exhaust gas upstream of the high temperature SCR.
Table 6.1 GE LMS100 Estimated Emissions Fuel Natural Gas Fuel Oil Turbine Exhaust Condition Turbine Exhaust Condition Ambient Temperature 30F 60F 90F 30F 60F 90F Operating Condition Base Load Base Load Base Load Base Load Base Load Base Load NO x (PPM / lb/hr) 25/79 25/81 25/78 42/137 42/137 42/126 CO (PPM / lb/hr) 183/354 155/308 139/264 169/336 148/293 129/236 VOC (PPM / lb/hr) 10/10.5 8/8.4 6/6.7 53/52 44/43 37/33 Estimated Stack Conditions (Post Control) Estimated Stack Conditions (Post Control) Ambient Temperature 30F 60F 90F 30F 60F 90F Operating Condition Base Load Base Load Base Load Base Load Base Load Base Load Stack Mass Flow (lb/sec) 474.9 468.9 443.4 475.1 461 424.1 Stack Temp. (degrees F) 741 771 799 764 792 815 NO x (PPM / lb/hr) 2.5/7.9 2.5/8.1 2.5/7.8 5/16.3 5/16.3 5/15.0 CO (PPM / lb/hr) 6/11.6 6/11.9 6/11.4 6/11.9 6/11.9 6/11.0 NH 3 (PPM) 5 5 5 10 10 10 VOC (PPM / lb/hr) 7/7.4 7/7.4 6/6.7 10/9.8 10/9.9 10/8.9 PM10 (lb/hr) 10 10 10 80 80 80
Notes: 1. All emissions concentrations expressed in PPMVD@15% O2. 2. Estimated emissions, not to be used for permitting purposes. 3. PM10 emissions estimates include SCR particulate contribution.Capacity Expansion Study Gowanus and Narrows Generating Stations

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17 Table 6.2 LM 6000 SPRINT Estimated Emissions Fuel Natural Gas Oil Turbine Exhaust Condition Turbine Exhaust Condition Ambient Temperature 30F 60F 90F 30F 60F 90F Operating Condition Base Load Base Load Base Load Base Load Base Load Base Load NO x (PPM / lb/hr) 25/43 25/40 25/38 42/74 42/70 42/65 CO (PPM / lb/hr) 49/51.01 24/23.77 10/9.57 6/6.56 6/6.20 6/5.69 VOC (PPM / lb/hr) 7/3.88 3/1.45 2/1.77 3/1.4 3/1.32 3/1.22 Estimated Stack Conditions (Post Control) Estimated Stack Conditions (Post Control) Ambient Temperature 30F 60F 90F 30F 60F 90F Operating Condition Base Load Base Load Base Load Base Load Base Load Base Load Stack Mass Flow (lb/sec) 308.1 284.5 269.9 308.9 290.9 269.3 Stack Temp. (degrees F) 800 834 840 810 827 848 NO x (PPM / lb/hr) 2.5/4.3 2.5/4.0 2.5/3.8 5/8.8 5/8.3 5/7.7 CO (PPM / lb/hr) 6/6.2 6/5.9 6/5.7 6/6.56 6/6.20 6/5.69 NH 3 (PPM) 5 5 5 10 10 10 VOC (PPM / lb/hr) 7/3.88 3/1.45 2/1.77 3/1.4 3/1.32 3/1.22 PM10 (lb/hr) 4 4 4 50 50 50
Notes: 1. All emissions concentrations expressed in PPMVD@15% O2. 2. Estimated emissions, not to be used for permitting purposes. 3. PM10 emissions estimates include SCR particulate contribution. 4. Credit not give for VOC reduction achieved in the CO catalyst. 5. GE Cycle Deck estimated emissions data shows uncontrolled LM6000 CO emissions to be a constant 6ppmvd@15% O2 when firing number 2 oil. No credit has been taken in the post control stack CO emissions estimates in the table above for further CO reductions. BREI suggests further review of the GE Cycle Deck predicted CO emissions rates by Astoria’s environmental consultant since CO emissions would be expected to increase as ambient temperature decreases. 7.0 Electrical Interconnections and System Impacts NYISO has implemented several procedural changes recently which make it somewhat more difficult to freely access existing system and system impact data/studies; and to access data that would allow one to draw independent conclusions with regard to system congestion, load flows, and the ability to inject additional electrical energy into the grids controlled by NYISO without detailed computer modeling. The process now requires that an interested party submit a formal system data request, which BREI has done on the behalf of Astoria. The data CD provided by NYISO contains systemCapacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

18 data that is filed annually with FERC in "Form 715" format. This data is updated annually and was last submitted to FERC on 4/15/06. BREI will provide Astoria with a copy of the NYISO data CD under separate cover. The data CD includes current NYISO "base case" load flow and short circuit data. However, the data is formatted for input into one of two modeling simulation programs (GE's PS-LF and PTI’s PSS software) and cannot be interpreted manually. BREI’s licensed ETAP software is not capable of modeling the NYISO provided data; BREI can provide continuing assistance to Astoria considering the following approaches: The first approach would be to independently model the ConEd grid using the NYISO data with either the PTI or GE software to estimate the additional export capabilities without ConEd system congestion. The second approach would be to make a formal request to NYISO for a System Impact and Reliability Study (SRIS). The SRIS would establish Astoria's position in the planned new capacity queue and Astoria’s cost allotment for any required system upgrades, but would take longer to complete than the independent model route. While BREI does not have the capability to run either the PTI or GE software, we can support either approach. We have modeling consultants who we work with that are licensed and trained to run the PSS simulation, or alternatively if Astoria elects to request NYISO to perform an SRIS study, we can support Astoria in developing the required data for the a NYISO SRIS application.
8.0 Other Information and Data During the course of this study, BREI has identified other information and data considered to be of value to Astoria in their development of capacity expansion projects at either Gowanus or Narrows. Following is a brief summary of this information along with BREI’s recommendations for further study.
1. LMS100 Availability: GE Energy have advised that they now have 25 firm orders for the LMS100. Delivery slots for orders placed now will be no earlier than June, 2008. Considering Astoria’s desired June, 2009 in-service date, LMS100 availability may become an issue unless reserve commitments are made with GE to support a delivery date no later than late summer 2008.
2. High Temperature SCR Design Life: As noted in the body of this report, due to the relatively low temperature of the LM6000 and LMS100 combustion turbines (750F – 850F), supplemental exhaust dilution cooling air injection is not required for the high temperature SCR. However, SCR catalyst life is directly proportional to operating temperature. Catalyst vendors have been predicting a 10 year catalyst life in LM6000 applications based on 3,500 hr/year of operation; however with the lower LMS100 exhaust temperature, preliminary indications are that the expected life may be as high as 15 years resulting in lower SCR life cycle costs for the LMS1000. Discussion with catalyst vendors regarding both catalyst life estimates and available guarantees should be initiated.Capacity Expansion Study Gowanus and Narrows Generating Stations

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Burns and Roe Enterprises, Inc. October 19, 2006

19 3. Existing Power Cable Capacity at Narrows: Astoria questioned whether the capacity of the existing "in-plant" high voltage buried oil filled power cables could be increased by adding a forced chilling system to support the new capacity (and potentially eliminate the need to trench between the pier and substation). This question can be studied further upon receipt of plant design data including, cable routing plans, rating of the exiting cables, and a one line diagram. However, based on the age of the facility, we believe that the existing cables are static oil filled where the oil acts as dielectric insulating fluid and enhances heat transfer between the cable to the outer casing and surrounding earth. If this is the case, forced cooling would require trenching for the addition of a parallel pipe to provide a return path for a closed loop oil circulating system, plus the addition of the chilling or heat rejection system. Recently, forced or circulating oil systems have become more common. While the level of possible incremental capacity is highly site and installation specific, BREI have studied chiller installations on existing forced circulation cable systems where capacity upgrades of as much as 40% have been realized. We are currently the Owners Engineer on one such project also located in the NYISO control
area.
4. Gowanus Foundation Design: Given the lack of available geotechnical data, foundation design requirements for the Gowanus South Pier site cannot be definitively determined. It is recommended that a limited geotechnical study be conducted to determine soil bearing capabilities, foundation design requirements, and to determine the possible existence of any existing subsurface foundations or other structures that might negatively impact foundation design or installation costs. The estimated costs for completing a limited evaluation in sufficient detail to define the type of foundations required would be on the order of $30,000 including sub-contract costs for 8 to 10 exploratory soil borings.

5. High Pressure Gas Connections – Narrows Power Barges: Hudson River tidal activity requires the use of fl exible connections for water, ammonia, oil, and gas between the barge and pier. Of specific concern is the identification of a design for the high pressure natural gas (650 – 750 psig) connection that is both reliable, and acceptable to the New York Fire Department (NYFD). A system we believe will satisfy these requirements is the use of a high pressure armored hose rather than a ball or swivel joint. Once such system is the “Technip” flexible pipe manufactured by Coflex. The Technip flexible pipe systems have ratings as high as 7,500 psig, have a long and reliable service history; and are used widely in North Sea gas field applications. A copy of Technip’s brochure is included as Appendix 3 of this report.
6. Labor Relations and GE equipment Warrantees: As noted in this report, there were some issues with IBEW Local 3 during the construction of the Jamaica Bay project wherein Local 3 required that prefab electrical console terminations (part of the Swiftpac package that had been wired in Pratt & Whitney’s non-union fabrication shops) be un-terminated when the equipment arrived onsite, and re-terminated in the field. GE have advised that Local 3 forced the same process during construction atCapacity Expansion Study Gowanus and Narrows Generating Stations

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20 some, but not all of the NYPA LM6000 peaker locations. GE took a position during this debate allowing this work only on power cabling at 125 volts and above; and maintained that any re-termination of low voltage I&C cabling would result in GE voiding their equipment warrantees. The IBEW capitulated to this requirement. However, this underscores the need to develop and maintain a good relationship with local craft before the project, and if at all po ssible to negotiate a Project Labor Agreement (PLA), especially with the IBEW before the project commences to address this type of issue before project execution.

### APPENDIX 2 The Power Barge Corporation Budgetary Quote
For the Capacity Expansion Study at Gowanus and Narrows Generating Stations

# PROPOSAL

Presented to:
Burns and Roe

For 

# NYC Power Barge Project



# The Power Barge Corporation

September 22, 2006

This document is privileged and contains conf idential information intended for use only by Burns and Roe` 

# The Power Barge Corporation

Page 2 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential 

## Table of Contents

1. Executive Summary...................................................................................... 3 2. ProEnergy Services & The Power Barge Corp . Overview .......................... 4 2.1 Power Barge Corporat e Profile & History ................................................... 4 2.2 ProEnergy Corporate Profile & Hi story ...................................................... 5 2.3 Qua lity .......................................................................................................... 6 2.4 Experience – Cor porate & Management...................................................... 6 2.5 ProEnergy Services Support Orga nization................................................... 7 3.0 Workscope Document .................................................................................. 8 3.1 Two (2) General Electr ic LM6000PC Sprint 50 MW Simple Cycle Power Barge` 

# The Power Barge Corporation

Page 3 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential 

### Section I Executive Summary The Power Barge Corporation (TPBC) and ProEnergy Serv ices (“ProEnergy”) are pleased to offer this power barge proposal for Burns and Roe for a 96 MW New York City located Power Barge Project. The proposal provides an indicative price and sc ope of supply for two LM6000PC Sprint simple cycle power barge. Given the clients requirements for uni on trade labor for erection and outfitti ng, we have assembled a team that combines The Power Barge Corporation’s gas turbin e power barge expertise w ith ProEnergy Services LM6000PC Sprint centerline and outfitting management, and JV Industries, a union outfitting shop in Texas. After reviewing East and Gulf Coast production capacities and pr icing, we have selected to propose a Gulf Coast program. Engineering and long lead procurements w ill take the first month of the project schedule. The deck barge fabrication will take about 7 months assu ming parallel construction utilizing a non-union fabrication yard. During this time period we assume that the, gas turbines, GSUs, SCR/ COs would be delivered. Installation of the power islands, SCR/ CO and all auxiliaries would be perf ormed by union shop labor in Texas. Outfitting of an LM6000PC Sprint will take about 3 months.
Given the mix of Gulf of Mexico union and non-union labor, and the relaxi ng of shipyard availability, our indicative pricing is $650 a kW of nominal rated installed capacity. This estimate does not include Site engineering, preparation, in stallation or interconnect. This proposal comprises a detailed description of:
• The Power Barge Corporation’s Profile and History
• ProEnergy’s Corporate Profile and History
• Project Descriptions and Scope The core EPC management team of The Power Barge Co rporation and ProEnergy Se rvices will set out all procedures and controls require d for coordinating and routing doc umentation, design and engineering information, technical interfaces and corres pondence as required ensuring the following:

♦ Planning and scheduling all project activities.

♦ Coordinating project activiti es with vendors and client.

♦ Coordinating project interfaces with client.

♦ Monitoring and reporting all project activities.

♦ Producing progress repo rts and schedules.` 

# The Power Barge Corporation

Page 4 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential ♦ Providing Project Management

♦ Providing contract management.

The Power Barge Corporation is the world’s leading gas turbine power barge EPC contractor. ProEnergy is a company comprised of some of the most experienced construction and commissioning service providers in the world. We believe our blend of prio r experience, “hands-on” technical knowledge, solid processes, extensive, construction, installation, operations and maintenance experience, and broa d corporate management experience makes us uniquely qualified to provide services to th e client, focusing on safely maximizing plant and equipment reliability, availability, and performance while maintaining the highest safety standards and exceeding environmental requirements. In addition, our collective management team has wo rked previously for all of the major gas turbine manufacturers and has an in-depth u nderstanding of both tec hnical and commercial cons iderations associated with the New York City power project. In addition, ProEnergy is able to su pport the project in the post commissioning phase through its four business lines, including original equipment manufacture trained Operations a nd Maintenance Services, Technical Advisors, Controls Specialists, Training Speci alists, and Maintenan ce support services. We look forward to reviewing this proposal with you a nd discussing with you the valu e ProEnergy Services and The Power Barge Corporation can bri ng to your organization and projects. 

### Section II The Power Barge Corporat ion & ProEnergy Services Overview 2.1 The Power Barge Corporation Profile and History The Power Barge Corporation concept began in 1990 as a subsidiary of Ge neral Dynamics, Electric Boat Company (nuclear submarine program). In a joint venture with Wes tinghouse, a product line of gas turbine simple and combined cycle power barges was developed. Since then, The Power Barge Corporation has evolved into a privately held cons ultancy and niche EPC firm specializing in power barges. The Power Barge Corporation staff has worked in the gas turbine power barge business since 1990 in project development support, engineering, design a nd construction of power barges. The Power Barge Corporation has enjoyed close working relationships with Siemens, General Electric, Wartsila, MAN B&W, and Kvaerner Masa Marine (now Aker Marine).` 

# The Power Barge Corporation

Page 5 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential Past experience includes contract work on the follo wing gas turbine power barges providing, consulting, engineering and design, or full EPC services: 30 MW General Electric Frame 6B simple cycle power barge EPC for 2 delivered power barges 48 MW Westinghouse combined cycle power barge to work with 98 MW unit Design with one unit under construction 48 MW Westinghouse W251B11 simple cycle power barge Design for one unit delivered 70 MW Westinghouse W251 B11 combine cycle power barge Design 98 MW Westinghouse W251B11 x 2 simple cycle power barge Design for two units delivered 100 MW Pratt & Whitney FT4C-3F x 3 simple cycle power barge Project Management/construction for one unit delivered 100 MW General LM6000PC Sprint simple cycle power barge Design contract – under review 105 MW Westinghouse W501 D5/A simple cycle power barge Design for two units delivered 185 MW General Electric Frame 7EA combined cycle power barge Consulting engineering serv ices – operational unit 220 MW General Electric LM6000PC x 4 simple cycle power barge Consulting engineering serv ices – operational unit Clients include El Paso, AES, Enron, Keppel Energy, Hyundai Engineering and Construction, Westinghouse, Sermetech/TTS, Alvarez & Marsal, Exxon Mobile and many project developers. 2.2 ProEnergy Corporate Profile and History ProEnergy Services is an integrat ed service company with broad domes tic and international experience. Established by a dedicated group of seasoned energy professionals in re sponse to a growing need within the energy industry for a cost-effective, safe, reli able service group with high quality standards, ProEnergy provides a broad spectrum of se rvices to the global energy industry. Through its four lines of business, 1) Construction and Installation, 2) Operati ons and Maintenance, 3) Professional Services, 4) Field Servic es, and 5) Technical Services, ProE nergy contributes to our client’s projects’ profitability by providing cost effective power plants and services, while maintaining the highest standards of quality.` 

# The Power Barge Corporation

Page 6 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential Our team is committed to the energy industries, a nd is comprised of industry experts who posses the global experience, knowledge, financial depth, and a re putation for exceeding our clients expectations, anywhere in the world. Our backgrounds include a wi de variety of skill sets and experience which allows us to quickly understand your needs and provide innovative so lutions. The value we can bring begins in the development stage of a project, through c onstruction and start-up, and continues through the long term operations and maintenance of a facility. Exceeding customer expectations is what sets ap art the commercial successes of our era from the commercial failures. The business world today continues to evolve and the success or failure of organizations are often tied to their ability to remain focused on customer satisfa ction, driving to reduce overhead so as to provide real value, and remaini ng dedicated to exceeding th e expectations of their clientele. ProEnergy Services holds forth that same vision as the model for its success. At ProEnergy Services, we are dedicated to pr oviding a level of service which eclipses our competitors... we do it better! We are passionate about c lient satisfaction, committed to lowe r costs, which we pass on to the consumer, and dedicated to exceeding our clients' expect ations. It is this commitment that has allowed
us to grow throughout the down turn in the energy market.

2.3 Quality Everything we do at The Power Barge Corporation a nd ProEnergy to remain as world-class companies is based upon delivering a reliable plants and services, free of de fects, in a timel y manner. We understand that our Customer’s facil ities must be available on schedule, and must be reliable to meet their anticipated business goals. Prior to mobilizing to a project, the team develops an initial plan and schedule based upon past project expe rience. During performance of th e services, we execute to preestablished criteria and sta ndards utilizing established check-lists and procedures. 2.4 Experience – ProEnergy Corporate & Management To date, ProEnergy has secured pr ojects both domestically and internationally in the following core
areas:

• Construction and Commissioning
• Project Management
• Centerline installation services
• Comprehensive long-term Operations &Maintenance
• Asset Management
• Mobilization Services
• Training
• Technical Writing Services` 

# The Power Barge Corporation

Page 7 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential • Turbine Maintenance and Diagnosti c, Field Engineering Support
• Controls and Operations Support
• Field Service Inspections
• Consulting Services
• Outage Support The extensive experience ProEnergy’s management team possesses has been gained by working with, and directly for, the following:

• Project Owners
• Utilities
• Third party service providers
• Architect – Engineering – Construction firms
• Original Equipment Manufacturers such as General Electric, Si emens-Westinghouse, Stewart and Stevenson, Pratt & Whitney, Alstom, and Mitsubishi.
• Financial organizations and investment groups. 2.5 ProEnergy Services Support Organization Located in the ProEnergy offices in Houston, Texas, Sedalia, Missouri and Atlant a, Georgia, specialists in engineering, construction operations, accoun ting, personnel, marketing, purchasing, and other disciplines assume responsibility for projects both domestic and internati onal in an early stage. In this way, both technical and regulatory e xpertise is provided in addition to assistance with quality, safety, administration, training and environmen tal programs. The concept behind th is support is to 1) allow the project personnel to focus on safely and efficiently pe rforming their duties, and 2) to minimize the staff required under each contract and allow the client to share in economies of scale. Our corporate staff reflects profes sionals from the energy industr y, with engineering, construction, maintenance, operations, and startup experience. The philosophy of the corporate staff is one of immediate and comprehensive support for the projects and plants we provide services to; we remain available 24 hours a day, 7 days a week, 365 days a year.` 

# The Power Barge Corporation

Page 8 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential 

### Section III Work Scope 3.3 2 x 48 MW power barges in a Genera l Electric LM6000PC Sprint Simple Cycle Firm Fixed with Assumptions to be clarified 3.3.1 Technical Specification General Plant Description The LM6000PC Sprint Power Barge Project consists of two (2) 48 MW gas turbine simple cycle power barge to be located in New York City harbor within an existing power barge complex. Each gas turbine power barge will have (1) LM6000PC Sprint gas turb ines, SCR/CO, related SCR auxiliaries, CEMS, fuel gas and water injection auxiliaries, 138 kV substation and a control room. The Plant's main power producing equipment will consist of one General Electric LM6000PC Sprint packaged gas turbine. The plant is designed to deliver a nominal plant output of approximately 50MW at a lagging power factor of 0.8 at ISO conditions. To meet the operating requirements, the two LM6000s w ill be erected, each on a single deck barge. The equipment will be mounted on or within the barge. The barge will be constructed by the American Bureau of Shipping (ABS) as a Deck Cargo Barge (Rivers Class). Concurrent with the construction activities to be performed at the aforementioned shipyard the preparation and in stallation of non-barge mounted equipment and the barge mooring system will take place at the Site as provided by others. Flag requirements are to be determined.
LM6000 Gas Turbine Generator Set The LM6000PC Sprint is a simple-cycle, 2-shaft gas turbine derived from the core of GE's highest thrust, highest efficiency aircraft engine, the CF6-80C2. The Low Pressure Turbine, High Pressure Compressor, High Pressure Turbine and Combustor of the LM6000 are virtually identical with their aircraft CF6-80C2 counterparts. This use of flight-proven parts, produ ced in high volume, contributes to the low initial cost and high efficiency of the LM6000.Major Components of the LM6000 turbine are: • Variable inlet guide vane section (VIGV) • 5-stage low pressure compressor (LPC) • 14-stage variable geometry high pressure compressor (HPC) . • Annular combustor • 2-stage air cooled high pressure turbine (HPT) • 5-stage low pressure turbine (LPT) • Accessory Drive Gear Box` 

# The Power Barge Corporation

Page 9 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential The LPC is driven through a concentric drive shaft by the 5-stage LPT, forming the low pressure rotor. The high pressure rotor is formed by the 14-stage HP C, driven by the 2-stage HPT. The high pressure "core" is formed by the HPC, combustor and HPT sec tion. Instead of a separate power turbine, as used on previous engines, the LM6000 uses the Low pressure Turbine (LPT ) to power the output shaft. Driving with the LPT simplifies the engine and improves fuel efficiency. The LM6000 gas turbine drives a generator through a flexible dry type coupling connected to th e front, or "cold", end of the LPC shaft. The generator is an air cooled, self -ventilated, cylindrical rotor machin e. It is a two pole synchronous generator with a brushless excita tion system and a permanent magne t pilot exciter. The generator utilizes an open, drip-proof design and is enclosed in a housing which reduces average noise levels to 90 dB(A) at one meter from unit and one and one-half meter above grade. The rotor is supported by two split sleeve bearings which are lubricated with a pressurized mineral oil system. The generator has a design life of 25-30 years, utilizes Class F insulation and is sized to operate w ith diode failure alarm, flux limiter, over-excitation limiter, volts per Hz cont rol, under excitation limiter, auto follower & null balance, auto transfer to manual control Class B temp erature rise. The generator is capable of absorbing the site rated power output of the gas turbine fo r base load operation th roughout the entire ambient temperature range of the applica tion. The generator is cap able of a 110% power overload for 2 hours out of every 24 hours of operation with no loss of ope rating life. The generator is also capable of withstanding a 30% overload current for 1 minute. Air Inlet System The air inlet system protects the gas turbine, genera tor and equipment compartments from the effects of airborne dirt and fo reign object damage.

• Minimizes maintenance requirements and frequency of filter replacement
Noise Control The standard equipment enclosure a nd air inlet silencer reduce near fi eld noise to 90 dB(A) at one meter from the enclosure and one and one-half meters a bove grade. Noise emanating from the gas turbine generator set will comply with ANS I B133.8 at 120 meters (59 dB(A)).

Auxiliary Equipment Skid For convenience of installation, Gene ral Electric has assembled the turb ine auxiliary subsystems into a single baseplate module which mounts next to the gas turbine base plate. The auxiliary equipment module includes:

• Hydraulic Start pump, reservoir and controls
• Water Wash reservoir and connections` 

# The Power Barge Corporation

Page 10 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential • Gas Turbine stainless steel lube oil reservoir and filters Control, Monitoring and Electrical System The control and monitoring system for the Genera l Electric LM6000 generator set provides a highly reliable, operator friendly packag e. The System components include:

• Turbine Generator Unit Control Panel
• Control Batteries and Charger Assembly
• Gas turbine wet gauge panel and water wash panel (local)
• Generator wet gauge panel (local) The Woodward NetCon 5000 unit control panel is the primary control point for the system. The Woodward NetCon 5000 provides the following primary functions:

• Fuel Management System
• Light-Off Fuel Gas Control
• Acceleration Control
• Deceleration Control
• Temperature Control
• Speed Governing The gas turbine wet gauge panel is mounted on the turbine enclosure and provides process readouts and safety devices necessary for maintenance. The pane l uses solid state electronics and is suitable for installation in a non-hazardous c ontrol room. The cont rol panel includes analog meters for key parameters, control switches a nd push buttons for operator commands, a programmable, microprocessor based sequencer. a CRT display, a nd RS232, LAN and Mod bus ports. Additional Auxiliary Equipment Supplied

• SCR/CO Pollution Control/Stack
• Ammonia Dilution and Vaporization Skid
• CEMS
• Closed Cooling Water System (Fin Fan)
• Station and Instrument Air System
• Fire Protection and Detection System
• Demineralized Water Injection System
• Oily Water Treatment Systems
• Sewage Treatment System` 

# The Power Barge Corporation

Page 11 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential • Building Systems Heating Ventilation and Air Conditioning Systems
• Plumbing and Drainage Systems Electrical Systems The Electrical System consists of the following:
• 138 kV System
• Main Generation System
• Medium Voltage System
• Low Voltage System
• DC and UPS System
• Grounding and Cathodic Protection
• Lighting and Receptacles .
• Power Barge Communications Systems
• Cable System
• Raceway System General Control System Design Basis The Plant instrumentation and control systems shall be designed to aid the Plant operator in achieving safe. reliable and economic operati on of all equipment in the Plant and to minimize the number of operators required. The various control systems, including the LM6000 Tu rbine Digital Control Systems. SCR/CO Controls Systems and a Balance-of -Plant Control System shall be operated locally.. Local controls furnished with the equipment packages will be interfaced with these control systems for alarm and monitoring purposes, as required by the system desi gn. Plant start-up, shutdown, and operation will be conducted by the Plant operators loca lly or remotely in the shore control room, as required, with the aid of manually and automatically co ntrolled local control equipment. Areas of local and! or remote control involved in startup, shut down, and operational annunc iation and monitoring of the Plant include:
• LM6000 Gas Turbine-Generator(including Wa ter NOx Injection and Water Wash)
• SCR/CO
• CEMS
• Auxiliary Cooling and Cooling Water Systems
• Service and Instrument Air
• Uninterruptible Power and DC Systems.
• Fuel Gas Forwarding
• Fire Protection Systems
• 138 kV Switchyard
• 480 V Switchgear
• 480 V Motor Control Centers` 

# The Power Barge Corporation

Page 12 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential Control Room The switchgear/local control building is a structure containing the electrical equipment room and the control room.
The air conditioned control room will house the LM6000 Turbine Digital Control Systems and a Balance-of-Plant PLC based Control System. The LM6000 Turbine Digital Control System is descri bed under the Gas Turbin e-Generator section. The SCR/CO/CEMS PLC based control system consists of a control termination cabinet and an operator man-machine interface. The Balance-of-Plant PLC based control system consists of a control termination cabinet, an operator man-machine interface, and two (2) printers. In addition, other panels and cabinets such as the Fire Protection Panel and Transformer Protection Panel may also be located in the control room as required. Naval Architectural Description The naval architectural features of the Plant include providing the re quired equipment support structure, barge, foundations, storm water drainage, and fenci ng as required supporting the Plant's objectives. The power generating units will be mounted on a singl e barge. The barge is a standard cargo barge with some local structural modifications to suit the equipment requirements. A shielding deck will be installed in the area of the gas turbines, approximately one (1) meter above the barge deck to serve as a walkway as well as a sun shield to minimize temperat ure distortions of the barge deck. At the Site the barges will be moored a nd commissioned by others.


### 3.3.2 New Construction The Power Barge Corporation and ProEnergy Serv ices will provide overall project management; engineering and design expertise; issue all tenders for equipment procurement; provide expediting and inspection services; arrange for freight forwarding a nd delivery to the power barg e; install and erect all equipment and materials on the power barge. For this project the scope of work is broken out as follows during the construction phase: The Power Barge Corporation Scope:
• Naval Architecture and Marine Engineering
• Project Management
• Deck Barge Fabrication and Structural Modifications
• Under deck modifications (structural/storm tank/oily water separator)` 

# The Power Barge Corporation

Page 13 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential • Gas Turbine Foundation(1 LM6000PC Sprint)
• SCR/CO Structural Foundation
• GSU Foundation
• Elevated operating deck/guard rails and misc. structure and containment

ProEnergy Scope:
• Project Engineering a nd Project Management
• LM6000PC Sprint GTG 60 Hz gas fuel
• Fuel Gas piping
• SCR/CO, auxiliaries and CEMS
• I&C, LV, MV HV systems
• Central Control Room/Work Shop
• 138 kV substation
• Demineralized Water Booster Skid
• Inlet air filter system
• Warranty engineer
• Warranty/Guarantee

To ensure complete coordination of the overall project throughout the various st ages of implementation from design through to completion, the project organi zation will include a core management team. The Project Executive heads the core team and has comp lete responsibility for th e project's execution from contract signing to final acceptance and will ensure th e appropriate company resources are applied to the project. Reporting directly to th e Project Executive is th e Project Manager who will be responsible for the day-to-day management of the project team and ensuring that the contract is fulfilled within the completion dates and to the satisfaction of the Cust omer. The ProEnergy project manager will be the primary point of contact on the project. Reporting di rectly to the Project Manager will be the Design Engineering Subcontractor, Project Engineer, Site Manager, GT T echnical Advisor, St art-up Manager, and the Mobilization Manager. Additional personnel assi gned to the project as well as subcontractors will report through these individuals. The core management team will set out all procedures and controls required for coordinating and routing documentation, design and engineering information, t echnical interfaces and co rrespondence as required to ensure the following:

♦ Planning and scheduling all project activities.

♦ Coordinating project activities.` 

# The Power Barge Corporation

Page 14 of 14 Burns and Roe Narrows Power Barge Complex Proprietary and Confidential ♦ Coordinating project interfaces.

♦ Monitoring and reporting all project activities.

♦ Producing progress repo rts and schedules.

♦ Providing site Manageme nt and Coordination.

♦ Providing contract management. The Power Barge Corporation and ProEnergy are committed to accomplishing the engineering, procurement, fabrication, construction, and commissi oning of this project within the targeted schedule, at the targeted cost with high qua lity and reliability in full compliance with laws, industry codes and standards, and Customer requirements. The ProEnergy corporate Quality Pr ogram will be utilized including our standard procedures and instructions adapted specifically fo r this project. These procedures have been developed and enhanced through use on past and pres ent successful projects. This Quality Program provides effec tive integration, planning, monitoring, and control of the activities performed in all facets of the project. It will provide the fr amework for effective communication and coordination of the interfaces between the Project Team, Project Suppliers, and the Customer.