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12/10/2009 ~ At their regularly scheduled meeting on Wednesday, December 9th, the Utility Board awarded a contract to rebuild one of three existing high speed diesel generating units and remove the two remaining units for a not-to-exceed amount of $1,096,234.00 to PowerSecure Inc.

The three high speed diesel generating units were installed at the Stock Island Generation Facility in 1965 and have provided a total of approximately 4.5-megawatts* (MW) of local generation to Keys Energy Services’ (KEYS) customers since that time. Due to their age and the corrosive environment, the units were in need of major exterior and interior repairs, complete overhauls, and electrical component upgrades.

During the October 14th Utility Board meeting the Board approved the conditional decommissioning of the three units based on the outcome of a competitive bid process. KEYS’ staff went out on competitive bids for two turnkey options. Option one was to install a new 2.2-MW quick start generation unit. Option two was to rebuild one of the high speed diesel generating units to meet the 2.2-MW output of a new unit. Option two was found to be financially and operationally favorable for the utility compared to option one. The cost of a new generation unit could have exceeded $3.2-million.

“The high speed diesel generating units are more durable than others because they are made to run for longer periods of time,” said Lynne Tejeda, KEYS’ General Manger & CEO. She added that, “another benefit of the rebuilt unit is that KEYS already has spare parts in its inventory that will support the required maintenance needed in the future.” The high speed diesel units utilize environmentally-friendly ultra clean low sulfur diesel.

Once complete, the generation output of the Stock Island facility will be approximately 108 MW. This represents approximately 75-percent of the areas peak power usage so KEYS’ local generation still exceeds the Utility Board’s commitment to maintain 60-percent on-island generation.

The work on the high speed units will be complete by spring in advance of the 2010 hurricane season.

The regular meeting of the Utility Board took place at 5:00 p.m., December 9th, in the Louis Carbonell Board Room of the William Arnold Service Building, 1001 James Street, Key West.

*Megawatt – A unit of electric real power equal to 1,000 kilowatts or 1,000,000 watts.

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