Example of Estimating Costs of Decommissioning Clause Samples

Example of Estimating Costs of Decommissioning. A preliminary example, for illustrative purposes only, of how the independent engineer might calculate the net-decommissioning costs is as follows. The net decommissioning cost is equal to the removal cost minus the salvage value. An example of a calculation for determining the decommissioning costs for one turbine is provided in Table 1. In the example provided in Table 1, the estimated cost of decommissioning a turbine would be the removal cost ($76,870) minus the salvage value ($73,500) for a net-decommissioning cost per turbine of $3,370. To calculate the decommissioning amount for the project, an estimate for the removal of the collection substation (owned by the Applicant) net of any salvage value would be added to the total turbine decommissioning cost. For example, if the cost of substation removal minus its salvage value was $20,000, then the value of the decommissioning security required would be: 6 Turbines x $3,370 (net decommissioning per turbine) + $20,000 (net decommissioning cost for collection substation) = $20,220 + $20,000 = $40,220. Removal of Tower 270 man-hours $65/hour $17,550 2 cranes for 5 days $6,000/day $30,000 Removal of Concrete Foundation (to 36 inches) 125 man-hours $65/hour $8,125 3-equipment days $2,500/day $7,500 Removal of Collection System (average 3200 feet/ turbine) 100 man-hours $65/hour $6,500 2-equipment days $3500/day $7,000 Seeding and Re-vegetation (~2.5 acres/turbine, including collection system) 3 man-hours $65/hour $195 Total Removal Costs $76,870 Salvage Value Per Unit Weight Rate Total 210 tons $350/tonii $73,500 Estimated Removal Cost Minus Salvage Value $3,370 iLabor Rates supplied and estimates reviewed by The ▇▇▇▇▇▇▇ Group, Inc. iiAmerican Metal Market, Scrap, Ferrous No 1 Industry heavy melt-Consumers Chicago gross ton $452.00 8/24/11 Although no undue adverse impacts associated with the Project are anticipated, the Applicant has defined this complaint resolution process to resolve any unanticipated complaints resulting from construction or operation of the Project. Prior to construction, the Applicant will communicate to neighboring residents, the Towns and permitting agencies the contact name and address of the Construction Manager (and, prior to the end of construction, an Operations Manager). The Applicant will also publish a 1-800 number to the community that will be accessed within 24 hours by constructions or operations personnel. Prior to commencement of construction, the Company will provide al...
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Related to Example of Estimating Costs of Decommissioning

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