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HomeMy WebLinkAboutSilver Lake Hydro Intervention 1996 UNITED STATES OF AMERICA FEDERAL ENERGY REGULATORY COMMISSION Silver Lake Hydro, Inc. ) Project No. 11548-000 NOTICE DISMISSING INTERVENTION (February 12, 1996) By order issued November 24, 1995, Silver Lake Hydro, Inc., was granted a preliminary permit for the proposed Silver Lake Project No. 11548. 1/ Because rehearing of that order was not sought, the Commission’s action in the proceeding is final. On January 17, 1996, the Alaska Energy Authority (AEA) filed a motion to intervene in the preliminary permit proceeding, stating that it had not received notice of the proceeding. 2/ Because the preliminary permit has been issued and is final, there is currently no proceeding in which to intervene. 3/ Accordingly, AEA’s motion to intervene is dismissed. This notice constitutes final agency action. Requests for rehearing of this notice may be filed within 30 days of the date of issuance of this notice, pursuant to 18 CFR 385.713. Lois D. Cashell Secretary Alaska Industria! Development and Export Authority 1/73 FERC § 62,129. 2/ On August 16, 1995, the Commission issued a notice of the application for preliminary permit, and set a deadline of October 27, 1995, for the filing of interventions. See 60 FR 44873, August 29, 1995. 3/ If an application for a license for the proposed project is filed, the Commission will issue a notice inviting interventions. At such time, AEA may wish to file a motion to intervene in the license proceeding. DC-A-33 ION FEDERAL ENERGY REGULATORY COMMISS U.S. OFFICIAL MAIL WASHINGTON, D.C. 20426 PENALTY FOR — PRivaTe | = = iy FEB 1396 J use g300) = O52 IAL BUSINESS pee ee 72s0t17 [u.s. posrags P—11549 1loiaze TLLIAM R, SNELL EX, OLRECTOR ALAS KA ENERGY AUTHORITY 480 WEST TODOR ROAD ANCHORAGE » AK 99503 " ALASKA INDUSTRIAL DEVELOPMENT AND EXPORT AUTHORITY /= ALASKA @™ ENERGY AUTHORITY 480 WEST TUDOR ANCHORAGE, ALASKA 99503 907 / 561-8050 FAX 907 /561-8998 December 21, 1995 Ms. Lois D. Cashell, Secretary Federal Energy Regulatory Commission 825 N. Capitol Street, NE Washington, D.C. 20426 Subject: MOTION TO INTERVENE Project No. 11548-000 Silver Lake Water Power Project Dear Ms. Cashell: The Alaska Energy Authority (AEA) understands that a preliminary permit has recently been granted for the subject project. We have reviewed our files and find no record that AEA was notified of this application. We understand that the comment date specified for this project has passed. However, because we received no notice concerning this project, we were unable to respond in a timely manner. Enclosed is our MOTION TO INTERVENE in the subject proceedings. The Alaska Energy Authority has interests not represented by other parties involved in these proceedings. Seal a William R. Snell Executive Director WRS:JHT:cjp Enclosure: As stated cc: Mr. Keith A Laufer, Assistant Attorney General, Dept. of Law, Anchorage Mr. Thom A. Fisher, Whitewater Engineers Mr. Mike Easley, CVEA Mr. S. Sieczkowski, AEA Mr. D. Beardsley, AEA Mr. J. Thrall, LIL Eile) anil UNITED STATES OF AMERICA FEDERAL ENERGY REGULATORY COMMISSION WHITEWATER ENGINEERS PROJECT NO. 11548-000 Motion to Intervene of Alaska Energy Authority Pursuant to the Federal Energy Regulatory Commission's ("Commission") Notice of Application for Preliminary Permit of August 16, 1995, and the Commission's Rules of Practice and Procedure, the Alaska Energy Authority, ("Energy Authority") hereby moves to intervene in this proceeding. In support of its motion the Energy Authority states as follows: it The Alaska Energy Authority is a public corporation of the State of Alaska, having its principal office at 480 West Tudor Road, Anchorage, Alaska. Correspondence and communications with respect to this Motion should be addressed to: Mr. William R. Snell Executive Director Alaska Energy Authority Attention: Stanley E. Sieczkowski 480 West Tudor Road Anchorage, Alaska 99503 Mr. Keith A. Laufer Assistant Attorney General Department of Law General Civil Section 1031 West Fourth Avenue, Suite 200 Anchorage, Alaska 99501 24 The Energy Authority is a Public Corporation of the State of Alaska. The purpose of the Energy Authority is to promote, develop and advance the general prosperity and economic welfare of the people of the State by providing a means of financing and operating power projects and facilities that recover and use waste energy (§ Ch. 278 SLA 1976; am § 5 Ch 156 SLA 1978; am § 1 Ch 133 SLA 1982; am § 9 Ch 18 SLA 1993). 3. The Energy Authority is supportive of projects resulting in sound energy development by entities other than itself and will make efforts to provide assistance as appropriate. 4. The Energy Authority is the Owner and FERC Licensee of the Solomon Gulch Hydroelectric Project (FERC No. 2742), located near Valdez and to the northeast of the proposed Silver Lake Project site. 5. The proposed project would produce power within the general area currently served by the Energy Authority's existing Solomon Gulch Project. 6. It may be necessary for the proposed project to utilize Energy Authority transmission lines to provide power to the area load centers. i Operation of the subject project could effect operation of the Solomon Gulch Hydroelectric Project. WHEREFORE, the Energy Authority moves that the Commission make and issue its Order permitting the Energy Authority to intervene in, and be made a party of, the above-entitled proceedings with a right to have notice of and appear at all hearings, to produce evidence and witnesses, to cross-examine witnesses, and be heard by counsel, and to submit briefs and participate in oral argument, if oral argument is granted. Dated this 21st day of December, 1995. Respectfully submitted, William R. Snell Executive Director Alaska Energy Authority li ge? i ALASKA INDUSTRIAL DEVELOPMENT AND EXPORT AUTHORITY {= ALASKA @™ ENERGY AUTHORITY 480 WEST TUDOR ANCHORAGE, ALASKA 99503 907 / 561-8050 FAX 907 /561-8998 November 1, 1995 Mr. Thom A. Fischer Whitewater Engineering Corporation 1050 Larrabee Avenue, Suite 104-707 Bellingham, WA 98255 SUBJECT: Silver Lake Project Dear Mr. Fischer: Thank you for your October 30, 1995 letter regarding the Silver Lake project. As you are aware, the CH2M Hill update study has been ongoing since June 1995. Mr. Dave Gray, Study Manager of CH2M Hill, indicated to us that he contacted Whitewater at the outset of the study asking if Whitewater wished to submit new information regarding your project. At that time Whitewater declined to provide any additional information. If you now believe that you have relevant new information, we encourage you to submit any supplementary information as soon as possible since the study is nearing completion. Any new information may or may not be considered depending upon the timing of its receipt and CH2M Hill’s judgment as to its applicability and reasonableness. However, it will be maintained and considered if any further updates of the 1994 feasibility study are required. Your letter also stated uses other than the Intertie should be considered for the $35M loan if the Intertie is determined not feasible. The scope as defined in the original 1994 feasibility study and for our update clearly limited the loan consideration to only the Intertie. It would most certainly take action by the Legislature prior to modifying this scope. Please let me know if you have any questions. Sincerely, DEM Cd Dennis V. McCrohan, P.E. Deputy Director - Energy cc: _ Riley Snell, Executive Director Vail Dave Gray, CH2M Hill WHITEWATER ENGINEERING CORPORATION - 1050 LARRABEE AVE., SUITE 104 - 707 BELLINGHAM, WA 98225 Ph. (360) 733-3008, FAX (360) 733-3056 DATE: October 30, 1995 FE A x FROM: Thom A. Fischer COVER SHEET TO: Dennis McCrohan COMPANY: AIDEA PHONE: 1-907-561-8050 NOTE: Enclosed is a proposal to have your consultant, CH2M Hill look at Silver Lake. If it is determined that the intertie is not feasible. then the $35,000,000 should stay in the Copper Valley/Cordova region for energy projects and not dispersed throughout the State. I-feel that if the intertie fails to be determined feasible, then the Legislature might move in favor of spending the $35,000,000 in committed funds on constructing Silver Lake for CVEA. (il ce. Rs i (2a Dove Evan ‘craw Wl NUMBER OF PAGES (including this one): 3 RECEIVER'S FAX NUMBER: 1-907-561-8998 1050 October 30, 1995 Mike Irwin, Commissioner of DCRA W. Riley Snell, Director AIDEA John Shively, Commissioner DNR SUBJECT: Sutton-Glennallen Intertie - Energy for CVEA Over the past 3 years, our company, Whitewater Engineering Corporation, has been observing with great interest the on-going studies conducted on the Sutton- Glennallen Intertic. We have been supportive of the intertie as an effective way of supplying energy to the Copper Valley region. However, as construction and environmental costs escalate, the benefits of developing local hydropower at Silver Lake are fast outweighing the benefits of the intertie. We now strongly believe that Silver Lake would provide the lowest cost energy and also be the most reliable energy source for Copper Valley. We urge you to extend the CH2M Hill report for 30 days to give this alternative due consideration. We have recently concluded that it will cost $40,000,000 to license, design and construct the Silver Lake Hydroelectric Project including the submarine transmission line, contingencies and interest during construction. The Project will produce about 45,000,000 kilowatt hours per year, utilizing Silver Lake almost exclusively as storage for winter energy for CVEA, while Solomon Gulch produces the summer energy. The Project would produce more energy than 45,000,000 kWh under a more level load condition. If the Silver Lake Project were funded with a $35,000,000 zero interest, 50 year loan, and a $5,000,000 seven percent interest, 20 year loan for the balance, the energy rate from the Project would be $.049/kWh (4.9 cents per kilowatt hour), including debt service and annual operations & maintenance. This $40,000,000 figure is about 35% less than the figures published in recent CVEA energy related studies. This is due to references back to the 1982 Stone and Webster study on Silver Lake, which concluded it would cost $64,000,000 to construct the project. Unfortunately, the 1992 Allison Lake study by HDR Engineering, Inc. and the soon to be published study by CH2M Hill essentially uses cost estimates from the Stone and Webster study. We find it important that CH2M Hill have the opportunity to not only look at the true cost of constructing the intertie, but also look at the true cost of constructing Silver Lake. LAURER AU BIG En PAL EONI UP Ev eins Usliler, ORAne a0n7auie RELLINGHAM, Wa $1611) 111773) 30or51 OOF Snore ARK sia (15). OV 08) tized coil 1On dA The Stone and Webster study was performed in the early 1980’s when the state of Alaska had excess oil revenues, and was constructing large hydropower projects such as the Four Dam Pool and Bradley Lake. Silver Lake and Black Bear Lake were two of the projects the State proposed to build. At that time, Silver Lake was estimated at $64,000,000 and Black Bear Lake was estimated at $30,000,000 to $60,000,000. Our firm just completed the final civil design and construction of the Black Bear Lake Hydroelectric Project for Alaska Power and Telephone. The 5 MW Black Bear Lake project cost under $12,000,000 including licensing, design, construction, 15 miles of transmission and interest during construction. This new project has the same plant capacity as the more expensive State proposals, but it was designed with cost in mind. Silver Lake is no different. Our firm can construct a project at Silver Lake that can produce 45,000,000 kWh of firm winter energy for $40,000,000. Other alternatives include eliminating the 100’ high dam and utilizing a siphon similar to the Black Bear Lake Project. We estimate that Silver Lake would produce 36,000,000 kWh without the dam, but will cost substantially less. Silver Lake could also be constructed in phases to meet CVEA’s energy requirements (construct the dam later). We believe that Silver Lake would cost less to construct than the intertie, and at the same time, there would not be the added cost of purchasing energy from the Rail Belt. We understand that this information is coming to you at a late date with regard to your decision process. -This decision will significantly affect the Copper Valley region over the next 50 years. Therefore, we are requesting that you extend the CH2M Hill report for 30 days and have either CH2M Hill or R.W. Beck perform an in-depth construction cost study on Silver Lake utilizing current construction methods. Sincerely, lew sf Thom A. Fischer, P.E. President, WEC ce Clayton Hurless, General Manager CVEA Dennis McCrohan, AIDEA Dave Gray, CH2M Hill Page 2 of 2 TOTAL P.@3 UImow- 4779 sae ae wn. iCweicr cINU. CUR. <b 695 SWSb P.Ul » WHITEWATER ENGINEERING CORPORATION 1050 LARRABEE AVE., SUITE 104 - 707 BELLINGHAM, WA 98225 Ph. (360) 733-3008, FAX (360) 733-3056 DATE: October 30, 1995 KA x FROM: Thom A. Fischer COVER SHEET TO: Riley Snell, Executive Director COMPANY: AIDEA PHONE: 1-907-561-8050 NOTE: Enclosed is a proposal to have your consultant, CH2M Hill look at Silver Lake. If it is determined that the intertie is not feasible, then the 35,000,000 should stay in the Copper _Valley/Cordova region for ener projects and not dispersed throughout the State. I feel that if the intertie fails to be determined feasible, then the Legislature might move in favor of spending the $35,000,000 in committed funds on constructing Silver Lake for CVEA. Ae NUMBER OF PAGES (including this one): PS RECEIVER'S FAX NUMBER: 1-907-561-8998 Wir-we-sz79 4a wo rcweicr CNU. CUR. 2e0b 735 SWD>b P.W2 October 30, 1995 Mike Irwin, Commissioner of DCRA W. Riley Snell, Director AIDEA John Shively, Commissioner DNR SUBJECT: Sutton-Glennallen Intertie - Energy for CVEA Over the past 3 years, our company, Whitewater Engineering Corporation, has been observing with great interest the on-going studies conducted on the Sutton- Glennallen Intertie. We have been supportive of the intertie as an effective way of supplying energy to the Copper Valley region. However, as construction and environmental costs escalate, the benefits of developing local hydropower at Silver Lake are fast outweighing the benefits of the intertie. We now strongly believe that Silver Lake would provide the lowest cost energy and also be the most reliable energy source for Copper Valley. We urge you to extend the CH2M Hill report for 30 days to give this alternative due consideration. We have recently concluded that it will cost $40,000,000 to license, design and construct the Silver Lake Hydroelectric Project including the submarine transmission line, contingencies and interest during construction. The Project will produce about 45,000,000 kilowatt hours per year, utilizing Silver Lake almost exclusively as storage for winter energy for CVEA, while Solomon Gulch produces the summer energy. The Project would produce more energy than 45,000,000 kWh under a more level load condition. If the Silver Lake Project were funded with a $35,000,000 zero interest, 50 year loan, and a $5,000,000 seven percent interest, 20 year loan for the balance, the energy rate from the Project would be $.049/kWh (4.9 cents per kilowatt hour), including debt service and annual operations & maintenance. This $40,000,000 figure is about 35% less than the figures published in recent CVEA energy related studies. This is due to references back to the 1982 Stone and Webster study on Silver Lake, which concluded it would cost $64,000,000 to construct the project. Unfortunately, the 1992 Allison Lake study by HDR Engineering, Inc. and the soon to be published study by CH2M Hill essentially uses cost estimates from the Stone and Webster study. We find it important that CH2M Hill have the opportunity to not only look at the true cost of constructing the intertie, but also look at the true cost of constructing Silver Lake. enginecring WE TE WAT E R corporation 10$0 LARRABEE AVENUE «¢ SUITE #104-707 * BELLINGHAM. WA + 98225 60735 31008) at AGS S60 73 Ss Se05i6 ; : LB Wolo isos Le wn tCweicr cu. LURr. <e0b 655 SUDb P.US The Stone and Webster study was performed in the early 1980’s when the state of Alaska had excess oil revenues, and was constructing large hydropower projects such as the Four Dam Pool and Bradley Lake. Silver Lake and Black Bear Lake were two of the projects the State proposed to build. At that time, Silver Lake was estimated at $64,000,000 and Black Bear Lake was estimated at $30,000,000 to $60,000,000. Our firm just completed the final civil design and construction of the Black Bear Lake Hydroelectric Project for Alaska Power and Telephone. The 5 MW Black Bear Lake project cost under $12,000,000 including licensing, design, construction, 15 miles of transmission and interest during construction. This new project has the same plant capacity as the more expensive State proposals, but it was designed with cost in mind. Silver Lake is no different. Our firm can construct a project at Silver Lake that can produce 45,000,000 kWh of firm winter energy for $40,000,000. Other alternatives include eliminating the 100” high dam and utilizing a siphon similar to the Black Bear Lake Project. We estimate that Silver Lake would produce 36,000,000 kWh without the dam, but will cost substantially less. Silver Lake could also be constructed in phases to meet CVEA’s energy requirements (construct the dam later). We believe that Silver Lake would cost less to construct than the intertie, and at the same time, there would not be the added cost of purchasing energy from the Rail Belt. We understand that this information is coming to you at a late date with regard to your decision process. ‘This decision will significantly affect the Copper Valley region over the next 50 years. Therefore, we are requesting that you extend the CH2M Hill report for 30 days and have either CH2M Hill or R.W. Beck perform an in-depth construction cost study on Silver Lake utilizing current construction methods. Sincerely, Tle A Thom A. Fischer, P.E. President, WEC cc Clayton Hurless, General Manager CVEA Dennis McCrohan, AIDEA Dave Gray, CH2M Hill Page 2 of 2 TOTAL P.@3