ATTACHMENT 8

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68 ATTACHMENT 8

69 Attachment 8 STATE OF MICHIGAN BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION In the matter, on the Commission s own motion, ) regarding the regulatory reviews, revisions, ) determinations, and/or approvals necessary for ) CONSUMERS ENERGY COMPANY to ) Case No. U G fully comply with Public Acts 286 and 295 ) of ) ) AFFIDAVIT OF GEORGE C. HASS George C. Hass, being first duly sworn, deposes and says as follows: I am Executive Director-New Generation for Consumers Energy Company. 1. I have earned a Bachelor of Science degree in accounting from Central Michigan University. I have worked for Consumers Energy Company and CMS Energy Corporation in the area of project development for over 15 years. 2. I have read the foregoing Application and I am familiar with the contents thereof. The facts contained therein are true, to the best of my knowledge and belief. 3. As Executive Director- New Generation I am responsible for the development of new fossil and renewable generation, which includes the Lake Winds Energy Park, a proposed MW wind farm located in Mason County, Michigan. The EPC contracts filed herein were negotiated under my direction and supervision. The bid process for each contract is hereinafter described. 4. Consumers Energy prepared Requests for Proposal (RFP) and developed a bid evaluation process for each of the EPC contracts associated with the Lake Winds TM Energy Park. Those contracts included the Wind Turbine Purchase Affidavit-gch

70 Attachment 8 Contract, the Balance of Plant Engineering, Procurement and Construction Contract and the Substation Transformer Purchase Contract. 5. Wind Turbine Purchase Agreement Consumers Energy initially established a list of possible wind turbine generator suppliers by identifying companies who were well established based on reputation, who have the infrastructure and support networks required to furnish equipment and services necessary to build and maintain the 100 MW wind farm here in Michigan. Industry reputation and financial strength sufficient to stand behind their products were important factors. Based on that analysis, eight (8) suppliers were issued a formal Request for Qualification (RFQ) in July Based on the responses to the RFQ, Consumers Energy chose five (5) suppliers for the Approved Bid List based on their relative rankings of strength with regard to their financial strength, reputation, market penetration for projects and services, demonstrated US based product and service experience as well and their safety and compliance record. An RFP was then developed and issued to five (5) suppliers on January 15, Proposals were received by February 19, Consumers Energy received eleven (11) wind turbine model proposals from four (4) manufacturers. One manufacturer declined to bid due to resource issues. The Company evaluated the proposals received in the manner described in its RFP. The bids were first evaluated for completeness and consistency with the proposal content and bid requirements outlined in the RFP. No proposals were rejected as a result of this step of the RFP. The Company then sent out a series of clarification questions to which the bidders responded. Next, the levelized cost of each proposal was Affidavit-gch

71 Attachment 8 determined. A financial model was developed using the information provided for in the bids and from answers to clarifying questions. Bid evaluation tables were developed to ensure all items bid were adjusted as necessary to fairly compare all proposals. A twenty-year levelized cost was developed using purchase price, selected options, noise and Michigan content adjustments. After analysis, Consumers Energy Consumers Energy selected the Vestas V100 as the most cost effective turbine model from the four manufactures with which to begin negotiations of the contract. After negotiations, Consumers Energy entered into the contract with Vestas-American Wind Technology, Inc. to purchase 56 V MW turbines. Vestas is the largest wind turbine manufacturer in the world and has manufacturing and service infrastructure in the U.S. In addition, the Vestas V100 is the most efficient machine for the lower wind speeds here in Michigan which made it the most cost effective bid. The Wind Turbine Purchase Agreement contract is provided as Attachment 1 to the Application in this matter. 6. Balance of Plant EPC contract Consumers Energy initially established a list of possible contractors who were known to be capable of providing full scope erection services, equipment, labor, tools, supervision, materials, engineering and procurement services for the construction of a 100 MW wind farm. The list included three (3) Michigan contractors who are known to have some level of wind farm project experience. Industry reputation, experience, and financial strength sufficient to stand behind their products were important factors. Based on that analysis, eight (8) contractors were issued a formal Request for Qualification in July Based on the responses to the RFQ, Consumers Affidavit-gch

72 Attachment 8 Energy chose all eight (8) contractors for the Approved Bid List. An RFP was developed and issued to eight (8) contractors on July 23, Proposals were received by August 27, Consumers Energy received proposals from seven (7) contractors. One contractor declined to bid due to resource issues. The Company evaluated the proposals received in the manner described in its RFP. The bids were first evaluated for completeness and consistency with the proposal content and bid requirements outlined in the RFP. No proposals were rejected as a result of this step of the RFP. The Company then sent out a series of clarification questions that the bidders responded to. Bid evaluation tables were developed to ensure all items bid were adjusted as necessary to fairly compare all proposals. After analysis, Consumers Energy selected White Construction, Inc. as the most cost effective bid from the seven (7) contractors with which to begin negotiations of the contract. After negotiations, Consumers Energy entered into the contract with White Construction, Inc., one of North America s leading wind park builders. White Construction has built more than 4,000 megawatts of wind energy capacity across North America. Under this contract, the majority of construction jobs and material purchases will be sourced from within Michigan. A typical wind park project involves about 150 construction jobs. The Balance of Plant Engineering, Procurement and Construction contract is provided as Attachment 2 to the Application in this matter. 7. Substation Transformer contract Consumers Energy initially established a list of possible transformer suppliers who were known for their successful technical and commercial experience, commissioning and testing as well as transformer Affidavit-gch

73 Attachment 8 product reliability. Based on industry reputation, experience and financial strength sufficient to stand behind their products, four (4) suppliers were selected for the Approved Bid List. An RFP was developed and issued to four (4) suppliers on July 27, Proposals were received by August 25, Consumers Energy received proposals from all four (4) suppliers. The Company evaluated the proposals received in the manner described in its RFP. The bids were first evaluated for completeness and consistency with the proposal content and bid requirements outlined in the RFP. No proposals were rejected as a result of this step of the RFP. The Company then sent out a series of clarification questions that the bidders responded to. Bid evaluation tables were developed to ensure all items bid were adjusted as necessary to fairly compare all proposals. After analysis, Consumers Energy selected GE Prolec Transformers, Inc. as the most cost effective bid from the four (4) suppliers with which to begin negotiations of the contract. After negotiations, Consumers Energy entered into the contract with GE Prolec Transformers, Inc. The Substation Transformer contract is provided as Attachment 3 to the Application in this matter. 8. After selecting the most cost effective proposals, the total cost of the proposals and the remaining costs of the project were totaled and compared to the costs included in the Company s RE Plan for a similar size project. Attachment 4 to the Application in this matter provides a comparison of the levelized cost of energy for Lake Winds TM compared to the levelized cost estimate included in the Company s RE Plan. At approximately $95 per megawatt hour, the levelized cost Affidavit-gch

74 Attachment 8 of the 100 MW Lake Winds TM Energy Park is approximately 36% lower than the cost estimates included in the Company s RE Plan. 9. These contracts are consistent with Consumers Energy s Renewable Energy Plan and should be approved. If sworn as a witness, I would testify as set forth above. George C. Hass Subscribed and sworn to before me this 18 th day of November, Sharon K. Davis, Notary Public State of Michigan, County of Jackson My Commission Expires: 07/28/16 Acting in the County of Jackson Affidavit-gch

75 STATE OF MICHIGAN BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION In the matter, on the Commission s own motion, ) regarding the regulatory reviews, revisions, ) determinations, and/or approvals necessary for ) CONSUMERS ENERGY COMPANY to ) Case No. U G fully comply with Public Acts 286 and 295 ) of ) ) Christen M. Rutz, being first duly sworn, deposes and says that she is employed in the Legal Department of Consumers Energy Company; that on November 18, 2010 she served a copy of a CD of Consumers Energy Company s Application for Ex Parte Approval of Contracts for Engineering, Procurement and Construction of The Lake Winds TM Energy Park - A Renewable Energy System upon the persons listed in Attachment 1 hereto, by the United States Postal Service. Christen M. Rutz Subscribed and sworn to before me this 18 th day of November, Sharon K. Davis, Notary Public State of Michigan, County of Jackson My Commission Expires: 07/28/16 Acting in the County of Jackson

76 ATTACHMENT 1 TO CASES NO. U and U Administrative Law Judge Hon. Sharon L. Feldman Administrative Law Judge 6545 Mercantile Way, Suite 14 P.O. Box Lansing, MI slfeldm@michigan.gov Counsel for the Michigan Public Service Commission Staff Kristin M. Smith, Esq. Pat Poli Assistant Attorney General Public Service Division 6545 Mercantile Way, Suite 15 Lansing, MI smithk20@michigan.gov polip@michigan.gov Counsel for Constellation NewEnergy John M. Dempsey, Esq Jennifer L. Copland, Esq. Dickinson Wright PLLC 301 E. Liberty, Suite 500 Ann Arbor, MI jdempsey@dickinsonwright.com jcopland@dickinsonwright.com Counsel for Energy Michigan Eric J. Schneidewind, Esq. Varnum Riddering Schmidt & Howlett LLP The Victor Center, Suite N. Washington Square Lansing, MI ejschneidewind@varnumlaw.com Counsel for Hemlock Semiconductor Corporation and Michigan Sustainable Energy Coalition Jennifer U. Heston, Esq. Fraser, Trebilcock, Davis & Dunlap, PC 124 West Allegan Street, Suite 1000 Lansing, MI jheston@fraserlawfirm.com Counsel for the Michigan Cable Telecommunications Association David E. S. Marvin, Esq. Fraser, Trebilcock, Davis & Dunlap, PC 124 West Allegan Street, Suite 1000 Lansing, MI dmarvin@fraserlawfirm.com Counsel for the Natural Resources Defense Council, Environmental Law & Policy Center, Ecology Center, and Michigan Environmental Council ( MEC ) Christopher M. Bzdok, Esq Olson, Bzdok & Howard, P.C. 420 E. Front Street Traverse City, MI chris@envlaw.com Rebecca Stanfield Natural Resources Defense Council 101 N. Wacker Drive, Suite 609 Chicago, IL rstanfield@nrdc.org Page 1 of 3

77 ATTACHMENT 1 TO CASES NO. U and U Counsel for the Natural Resources Defense Council, Environmental Law & Policy Center, Ecology Center, and Michigan Environmental Council ( MEC ) - (Cont d) Bradley D. Klein, Esq. Robert J. Kelter, Esq. Environmental Law & Policy Center 35 E. Wacker Dr., Suite 1300 Chicago, IL bklein@elpc.org rkelter@elpc.org David Wright Ecology Center 117 N. Division St. Ann Arbor, MI davidw@ecocenter.org Counsel for RES North America, LLC, LS Power Associates, L.P., Lafarge Midwest, Inc., Michigan Wholesale Power, and New Covert Generating Company, LLC Rodger A. Kershner, Esq. Jon D. Kreucher, Esq. Howard & Howard Attorneys, P.C. 450 West Fourth Street Royal Oak, MI rkershner@howardandhoward.com jkreucher@howardandhoward.com Counsel for the Association of Businesses Advocating Tariff Equity ( ABATE ) Roderick S. Coy, Esq. Leland R. Rosier, Esq. Thomas E. Maier, Esq. Clark Hill PLC 212 E. Grand River Avenue Lansing, MI rcoy@clarkhill.com lrrosier@clarkhill.com tmaier@clarkhill.com Consultant for the Association of Businesses Advocating Tariff Equity ( ABATE ) James T. Selecky Brubaker & Associates, Inc. Physical Address Swingley Ridge Road, Suite 140 Chesterfield, MO Mailing Address P. O. Box St. Louis, MO jtselecky@consultbai.com Counsel for Attorney General, Michael A. Cox Donald E. Erickson, Esq. Assistant Attorney General Environment, Natural Resources, and Agriculture Division 6 th Floor Williams Building 525 W. Ottawa Street P.O. Box Lansing, MI ericksond@michigan.gov Consultants for Attorney General, Michael A. Cox Michael J. McGarry Dan Salter Donna Mullinax Blue Ridge Consulting Services, Inc Woodruff Road, Suite PMB 309 Greenville, SC mmcgarry@blueridgecs.com dsalter2@charter.net dmullinax@blueridgecs.com Page 2 of 3

78 ATTACHMENT 1 TO CASES NO. U and U Counsel for Midland Cogeneration Venture Limited Partnership ( MCV ) Richard J. Aaron, Esq. Warner Norcross & Judd LLP 120 N. Washington Sq., Ste. 410 Lansing, MI raaron@wnj.com Counsel for the Michigan Community Action Agency Association Don L. Keskey, Esq. Public Law Resource Center PLLC 505 N. Capitol Avenue Lansing, MI donkeskey@publiclawresourcecenter.com Page 3 of 3