Lakeland Electric Unit 5 is shut down and needs at least $21 million in emergency repairs
Lakeland Electric faces more than $21 million in emergency repairs to its flagship generator to get it back up and running, hopefully before summer arrives.
Mike Beckham, LE's general manager, said the C.D. McIntosh Unit 5, a natural gas-powered, combined-cycle unit capable of producing up to 360 megawatts, unexpectedly tripped offline Feb. 23. It was a week before the plant's annual scheduled outage for maintenance.
"When it came off, it made some noise. It did not have any vibrations," Beckham said. "We heard some rub in there, something just didn't sound right."
An extensive inspection of Unit 5, including a borescope inspection to provide a look inside the plant, was completed March 31. It discovered that a metallic expansion bellows had failed, causing "extensive damage" to the compression section of the combustion turbine that required removing the rotor.
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Beckham said Lakeland Electric was forced to enter a short-term power purchase agreement, or PPA, to buy energy to provide power for LE's customers. The exact details of the PPA were not given at Friday's agenda study.
In an memo to City Manager Shawn Sherrouse, Beckham wrote, "pricing from the PPA is never as favorable as the cost of operating [Unit 5] and can be quite high at times when demand comes near supply in Florida, as occurred approximately two weeks ago."
Sherrouse sent an email dated April 10 telling the commission he planned to authorize an emergency purchase for repair of Unit 5. The city manager said part of his reason was to avoid "the potential of not having enough PPA ability to meet our needs over a longer period of time."
Beckham said Unit 5's damaged rotor has been shipped to manufacturer Siemens in Charlotte, North Caroline, which has had staff working on it round the clock.
"There are no alternatives to repairing [Unit 5] if we are to keep it operating, our ten year site plan anticipates that we will do that for the next decade," Sherrouse wrote in his April 10 email to the commission.
Commissioner Sara Roberts McCarley asked LE if there was not a "red flag" that this was happening at the municipal-owned utility. There was no mention of Unit 5's unexpected outage at the March Utility meeting.
Beckham said he didn't have a solid number on how much it was going to cost to fix the unit, with some estimates still coming back at more than $30 million, and he didn't want to provide misinformation to the commission.
"I would have liked to have known a problem was ongoing before the email we received the other day," Commissioner Sam Simmons said.
Lakeland Electric staff said they have been given a rough estimate of mid-June to receive the rotor back and complete the process of reinstallation.
Given the unexpected costs, Sherrouse said he would be discussing options for financing the repairs with commissioners during one-on-one meetings. These one-on-one meetings are not open to the public.
Simmons asked whether the utility has insurance to cover these types of breakdowns. Beckham said LE will file an insurance claim, but reaching a settlement and receiving the funds can take up to three years.
Sara-Megan Walsh can be reached at swalsh@theledger.com or 863-802-7545. Follow on Twitter @SaraWalshFl.
This article originally appeared on The Ledger: Lakeland Electric to pay over $21M in emergency repairs to Unit 5
