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HomeMy WebLinkAboutKotzebue Waste Heat Correspondence 1987 Kotzebue Electric Association, Inc. THIRTY MILES NORTH OF THE ARCTIC CIRCLE P.0. BOX 44 Kotzebue, Alaska 99752 Phone (907) 442-3492 RECEIVE} MAY 2.98 1987 ALASKA POWER Alaska Power Authority AUTHORITY P. O. Box 190869 Anchorage, Alaska, 99519 May 22, 1987 Attention : Robert E. LeResche Executive Director Subject : Technical Assistance, Community Waste Heat Recovery Dear Mr. LeResche: Kotzebue Electric Cooperative hereby requests technical assistance for the engineering tasks associated with the rehabilitation and potential expansion of our existing waste heat recovery system to provide heat to the local schools and other users. The system was constructed during 1984 with the intent of providing waste heat for the city’s circulating water system. Since then we have experienced a number of operational problems, which have to some extent diminished the benefits originally anticipated from the system. We have been made aware of the Alaska Power Authority’s capabilities in this field, and we would appreciate assistance as outlined above. If any additional information is required of if you would like to discuss this request with me, please do not hesitate to contact me at 442 3491. | cD CORRESPO!DS » ACTION: Very truly your Sook hie Frank Sheldon General Manager}. DATE REC'D: cc: Mr. Steve Whi Arctic School District. Kotzebue Electric Association, Inc. THIRTY MILES NORTH OF THE ARCTIC CIRCLE P.0. BOX 44 Kotzebue, Alaska 99752 Phone (907) 442-3492 William Hensley, State Senator P.O. Box V Juneau, Alaska 99811 January 22, 1988 Dear Willie: Kotzebue Electric Association, as part of it’s long term planning process, has decided that we need to look at the potential of coal as a long term resource. In order to make the decision to use coal, we will need to determine the price level at which coal becomes competitive with fuel oil, what type of technology is available for small scale coal generation, the economic potential of the two known coal sites, and the environmental impact of using coal. We are asking your assistance to see if the State of Alaska can provide funding to see if coal will work for electric generation in Kotzebue. The State has participated in several studies that have looked at coal as a local resource, but has not put in place a project that would allow a coal field in our area to be put in production. In reviewing the studies that have been conducted it is apparent that coal.could be economic today if there were one or two major users. IKEA has been xploring the use of coal, and feel that we are in the position of being one of the users if the economics of scale are there. Some of the long term benefits that would be available are as follows: 1. Stabilized energy costs for the long term. 2. Local economic development and jobs for area residents. a. on-site mine development b. plant construction c. transportation 3. Utilization of area resources. 4. Reduced energy costs to the state as more users come on line, (Red Dog, Nome utilities, Adak Naval Station),through economics of scale. Source of waste heat, to heat public buildings. Use of coal to heat village homes. on Qa You will find enclosed the outline for the information that we feel is needed to make the decision to use coal, and KEA Board Resolution #637. We hope that you may be able to help us secure funding through the Alaska Power Authority, DCRA, or other sources that could help with this project. We would like to thank you for any ~ assistance you are able to provide. Sincerely, | adc , Kotzebue Electric. Association, Board of Directors Brad Reeve, President COALFDG Kotzebue Electric Association, Ine. THIRTY MILES NORTH OF THE ARCTIC CIRCLE P.O. BOX 44 Kotzebue, Alaska 99752 Phone (907) 442-3492 August 12, 1987 BOARD RESOLUTION # 637 WHEREAS: Coal fired generation equipment is becoming economically feasible and coal is becoming available and Kotzebue Electric Association’s aging plant requires replacement by 1998 to 2000 and THEREFORE BE IT RESOLVED: Management is requested to pursue a feasibility study for a 1998 coal fired unit. KOTZEBUE ELECTRIC ASSOCIATION, INC. , fs 7 Y SY Apes we : Ce +e BRAD REEVE, PRESIDENT , 7 “ , 7 . Ye fete Carte Cte ROBERT CALVILLO, SECRETARY/TREASURER COAL CONVERSION STRATEGY FOR KOTZEBUE ELECTRIC ASSOCIATION - AN EVALUATION TASK 1 - LOAD CHARACTERISTICS & CAPACITY REQUIREMENTS In cooperation with Kotzebue Electric Association, (hEA) management determine the current capacity ‘to meet demand for both peak and off-peak period and seasons. Project the future demand for electric generation based on historical demographic patterns and probabilistic treatment of Kotzebue’s industrial potential in mining and oil. In addition to projecting electricity for illumination, include an evaluation of potential demand for thermal uses such as district heating for institutional facilities. TASK 2 - FUEL Review possible regional coal sources including Deadfall Syncline (Pt. Lay) and Chicago Creek and compare the costs of mining, transporting and storing the fuel. Coal resources will in all cases be compared to continued use of fuel oil. TASK 3 - SITE EVALUATION Identify possible Locations ror plant expansion and/or replacement and the impact ct those choices on related factors such as fuel transportation and transmission line costs, cooling water availability, district heating options and geotechnic or environmental considerations. TASK 4 - PLANT AND EQUIPMENT SYSTEMS Perform a preliminary evaluation of appropriate coal .utilization technologies and utilization modes (i.e., power generation, cogeneration or stand-alone district heating, ete). These results will be presented to NEA representatives and project personnel. The best candidate technologies and utilization modes will be advanced for more in-depth evaluation, including a conceptual system design which meets the energy needs of the community. TASK 5 - ESTIMATE COST OF CONVERSION Estimate budgetary total installed cost (exclusive of finance costs) for the selected energy system(s). Compute unit generating and heating costs for life of project; and given a consumer selling price, determine COAL CONVERSION STRATEGY Page 2 of 2 J “+ return on equity, debt coverage, ete. Since the production level of the coal at the mine greatly affects the economy of coal, the cost of energy to Kotzebue will be determined at various coal production levels based on anticipated demand for coal by other regional users. TASK 6 - FINANCES Determine possible sources of funding for the capital investment and analyze the economics in terms of the benefit/cost ratios and net present values at various discount rates and the rate of return to the community. TASK + - EVALUATE ENVIRONMENTAL EFFECTS identify and define environmental effects of the project. Assess the need, feasibility and cost of offsetting any adverse effects. This step will include input from all regulatory bodies and concerned groups. Ensure compliance with all applicable laws. Incorporate local concerns into the project, so as te ensure support for the project. TASK 8 - SOCIOECONOMIC IMPACT Develop a detailed description of all project effects on the economy of the region, the community of Kotzebue, and the individuals living in the community. Consider both the immediate and the long term. Assess the receptivity of the community to all phases of the project, and consider the influence this may have on project success. Assess the economic development potential in the utilization of local resources as fuel sources. Calculate the number, type and longevity of jobs to be generated and the capacity of the Local labor foree to fill the positions. dantiary MEMORANDUM fram Citv of Kotzebue. (See attachments action meeded from us? estimate seem far aut of proportion for the value improvement to the water c i 5 it might ke a look at th a good idea to te the mentianed that the Citv of Nome had a similar system ina t of i964. evet is ble af idima ail t ystem in Nome. which i This if fansteuctian RECOMMENDATION: review of by the Power If action is reauir fran ’ Auth r dd anc propased solution should be perform Authority. Sufficient in-house expertise is a CITY OF KOTZEBUL P.O. BOX 46 KOTZEBUE, ALASKA 99752 907-442-3401 _-"REGEIVED "IOV 1 4 1983 ae TOD LLTAORITY November 7, 1983 Mr. Ray Benish Executive Director Alaska Power Authority 334 W. Sth Avenue Anchorage, Alaska 99501 Subject: City of Kotzebue Heat Exchange System Grant Request Dear Mr. Benish: The City of ‘Kotzebue has in past years provided freeze protection for its water distribution system through use of waste heat the Kotzebue Electric Association (KEA) Power Plant. KEA received Rural Electric Association (REA) funding for the installation of a new generator, but no provisions were made or funding secured to’ provide for waste heat recovery on the new generator. The City of Kotzebue, in an effort to protect their water dis- tribution system by use of a waste heat recovery system, re~ quested the design of a system to be bid as an additive bid item to the generator installation contract. In June of this year KEA received bids for installation of the L new generator and the heat exchange system to provide the city's water system with continued freeze protection. The bid for the generator was accepted and installation is underway with com- pletion scheduled for December 1983. The low bid amount of $378,000 for the heat exchange system was more than double the amount of the Engineer's estimate and funds were not available from the City to install the system. Consequently, the heat exchanger system bid was rejected and the design put on the shelf. In addition to the heat exchange system, it will be necessary to install a conveyance system between the City water treatment plant and KEA as well as minor modifications to the water treat- ment plant interior plumbing at an estimated cost of $462,000. The attached sheet provides more detailed information regarding estimated construction costs. “GATEWAY TO NORTHWEST ALASKA” + Mr. Ray Benish Alaska Power Authority November 7, 1983 Page 2 a we As per phone conversation between Jerry Dunn of QUADRA Engineer- ing, Inc., and Mr. Jerry Larsen of your office, the City of Kotzebue requests consideration from the Alaska Power Authority for appropriation of funds to assist the City with installation of the necessary heat exchangers and conveyance systems. Plans for the heat exchange system are complete and ready for con- struction at this time and plans for the conveyance line will be complete for bid within two weeks of availability of funding. The City of Kotzebue requests your review of this request for a grant in the amount of $840,000 to assist the City in providing continued freeze protection for the water distribution system. Should you require additional information regarding this request, please contact Mr. Jerry Dunn at QUADRA Engineering, Inc., at 276-3770. Please be informed that a request for funding will also be made to our local state legislators and any assistance you may give us in procuring the funding would be greatly appreciated, as this project is critical in maintaining the integrity of our water distribution system. Sincerely, John Ward Director of Public Works Attachment ESTIMATED COST CITY OF KOTZEBUE HEAT EXCHANGE SYSTEM Heat Exchange System Bids received 6/30/83: Wick Construction $572,000 Alaska International Construction $378,000 Engineer's Estimate (IECO) $186,000 Estimate of funds required $378,000 Conveyance Systeni Materials $ 60,550 Freight (Seattle to Kotzebue) 5,550 Installation 277,500 $343,600 +25% Eng. & Contingency 85,900 $429,500 Estimate of funds required $430,000 Water Treatment Plant Connection Installation $ 1,500 +25% Eng. & Contingency 375 $ 1,875 Estimate of funds required $ 2,000 Summation: Heat Exchange System $378,000 Conveyance System 430,000 Water Treatment Piant Connection 2,000 $810,000 Add: Mobilization & Demobilization 30,000 $840,000 Grant Amount Request $840,000