Due Diligence Studies
EWZ Bergell Power Station Group Due Diligence Engineering Assessment
Devine Tarbell & Associates, Inc.’s (DTA) staff was retained to perform due
diligence engineering reviews of European hydroelectric projects to assess the
condition, value and life and therefore the viability of potential
lease/lease-buyback transactions. Elektrizitatswerk der Stadt Zurich (Electric
Authority of the City of Zurich, or EWZ) owns the Bergell Power Station Group, a
set of five hydroelectric power stations located in the Bergell Valley along the
Alps of in southern Switzerland. These five stations include eight impulse
turbine-generating units with a combined capacity of 180 MW.
DTA’s staff made site visits to the power station group and conducted civil,
structural, electrical and mechanical inspections of the project works. Power
station group personnel were interviewed to obtain a working level understanding
of the operations and maintenance required for each specific facility. An
assessment was made of the effectiveness of operating processes, procedures and
practices, both current and anticipated. Design, construction, operating and
maintenance documents were reviewed in detail. Field inspection and meeting
notes were prepared, circulated for comment and finalized. A detailed due
diligence engineering report was prepared for the power station group,
describing the project components, condition, operation and maintenance
programs. The report also provided estimates of project cost, O&M
costs,remaining useful life, and future capital component replacement and
upgrade costs associated with that life projection. Environmental and regulatory
compliance reviews and evaluation were limited to current and projected
operating and water right concessions and federal/provincial dam safety
requirement compliance.
As part of the evaluation, an assessment and determination were made to ensure
that the transaction under consideration included the required combination of
assets to constitute a completely operating project, including any shared assets
outside the transaction but necessary for the project’s operability.