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Copper Valley Intertie review 1995
COPPER) VALLEY) EURCTRIC ASSOCIATION ING. P.O. BOX 45, GLENNALLEN, ALASKA 99588 (907) 822-3211 FAX 822-5586 VALDEZ (907) 835-4301 Fax 835-4328 May 19, 1995 KF: os c Mr. Mike Irwin, Commissioner Department of Community and Regional Affairs ; tiotcy P. O. Box 112100 f Juneau, Alaska 99811-2100 Mr. John Shively, Commissioner Department of Natural Resources 400 Willoughby Ave. Juneau, Alaska 99801-1796 Mr. Riley Snell, Executive Director Alaska Industrial Development and Export Authority 480 West Tudor Road Anchorage, Alaska 99503 Gentlemen: In an effort to assist in your review of the Sutton to Glennallen 138 kv transmission line (SGL) project, we are submitting for your consideration selected documents, reports, and papers that have been prepared over the past two and one-half years that address themselves to certain aspects of the project. We are also submitting information on power supply alternatives that have been studied and evaluated, some of which opponents of the project have held out as viable ways to prevent construction of the intertie. COPPER VALLEY ELECTRIC (CVEA) CURRENT GENERATION STATUS CVEA operates the State-owned 12 mw Solomon Gulch Hydro Project (SGH) under a long-term contract expiring in 2030. The contract obligates CVEA to take all of the production available from SGH up to its ability to use the output to serve its loads. SGH has historically provided adequate generation to serve all of CVEA's load during the five month period from approximately mid-May to mid-October. CVEA's system load peaked at 12.1 mw in 1995, which will make it necessary to begin supplementing SGH's production in the summer months for the first CVEA's Status and Future May 19, 1995 Page 2 time with some other form of generation. From mid-October to mid-May SGH generates a reduced amount of power depending on the amount of water available. For calendar year 1994, SGH generated 48,200 mwh that provided 66% of CVEA's total power supply requirement. CVEA pays for all power taken from SGH at the current rate of 6.6 ¢ per kwh. CVEA owns and operates two diesel plants to provide for the balance of its power requirement, which is termed the "supplemental requirement." The diesel plants consist of a 6.0 mw plant located in Glennallen and a 10 mw plant in Valdez. The two plants are comprised of 13 reciprocating engines, ranging in age from 20 to 35 years, and one 20-year old 2.8 mw Solar combustion turbine. These diesel plants or another source of power at both Glennallen and Valdez are also essential as year-round standby capacity. In 1994 CVEA’s cost of diesel generation was 13.6¢/kwh. The five-year average cost from 1990 through 1994 for diesel generation was approximately 15¢/kwh. The total average system wholesale cost of power, including purchases from SGH and generation from the diesel plants for the same five-year period, has been just under 10¢/kwh. CVEA's power cost is about two times the firm wholesale power cost of 5¢/kwh for those utilities in the Railbelt System. The age of the two diesel plants has been of increasing concern to CVEA's Board of Directors for several years. Each year "shelf" parts become successively harder to find. Parts that are custom made are often two or more times as expensive as shelf parts. It is our opinion that the economics of maintaining the old engines will become increasingly prohibitive as time goes on. SEARCH FOR AN ALTERNATIVE i CVEA made a decision in 1992 to attempt to maintain the old diesel plants until a suitable alternative capacity and standby for both Valdez and the Copper Basin could be identified and implemented. The window within which the existing resources can be operated within acceptable economic parameters has begun to close. This dictates that a "do-nothing option" is not an alternative. CVEA's mandate, as a capital intensive service provider, is to plan into the long-range future if we are to fulfill our responsibility to our members. As everyone understands, this is a difficult task at best and one that demands integrity and objectivity if it is to be effective. The move by the Board to obligate for a large project, such as the intertie, is a major decision by any measure. If the Board is to meet the challenge of the future, it must look beyond just the size of the project to the underlying economics and both the short- and long-term impact of the investment. CVEA's Board realizes it must invest and operate within its limits to repay its obligations. Once a large scale capital expenditure decision is made, it becomes impossible to turn back. Even a limited amount of capital investment to bridge the interim period will dilute the benefit of a long term solution. If CVEA makes the wrong decision on a major capital expenditure, it will, in all probability, foreclose any future option for CVEA. It is within the scope and context of these kinds of circumstances that utility Boards CVEA's Status and Future May 19, 1995 Page 3 sometimes opt for an expedient short-term fix, hoping the problem will be easier to resolve in the future. CVEA is making a concerted effort to avoid that mistake. The problem CVEA is facing will never be any easier to solve than it is now. It is also reasonable to believe that, in the future, it is unlikely any significant State assistance would be made available. The above factors will force CVEA to a decision in the near future. CVEA has made a concerted effort to carefully and objectively screen resource alternatives to arrive at the right long-term decision. In October 1993 we prepared an information booklet entitled "History and Status of Power Generation Resources" which provides a summary discussion of the various resource alternatives that have been evaluated over the years and the reasons for rejecting them (copy enclosed as Attachment A). This booklet places the SGL in a realistic perspective to the other resource alternatives. We believe that this document provides excellent insight into the real-world viability of proposed alternatives. LOAD-GENERATION RESOURCE BALANCE Load growth on CVEA's system over the past few years has caused critical reserve generation resources, particularly during the low water period at SGH, to decline as low as they can safely be allowed to go. It may be possible to get by for a limited time but we are at the threshold of having to do something. Attachment B describes the regions tightening resources/load balances. SELECTION OF AN ALTERNATIVE TO EXISTING DIESEL GENERATION CVEA faces three major challenges in selection of new power supply resources to replace the aging diesel system. First, to identify a resource that has the best possible economic impact, keeping in mind that rate reduction is the first and highest priority. Second, to implement an alternative resource that achieves maximum system reliability. Third, to establish a generation resource base or transmission interconnection and power supply that will provide for future load growth. Economic development is stifled in this area of the State not only because of the high cost of electric power but also because of the lack of available capacity and energy resources. CVEA could not serve a major additional load today (1 mw or greater) without adding new generation. The addition of new high- cost generation on an "as needed" basis is neither good planning nor a rational economic answer. Using this approach would, in all probability, cause CVEA's high rates to go even higher and further reduce the probability of economic growth. CVEA's Status and Future May 19, 1995 Page 4 SYSTEM RELIABILITY Power supply reliability of the system, particularly in the Copper Basin district, is a critical consideration. The Valdez and Copper Basin districts are tied together with the State-owned 138 kv transmission line. Power flows both ways over the line, depending on the time of the year, etc. Industry standards require two sources of power feed to a substation to meet basic acceptable reliability tests. The power requirement for the Valdez district is fed through the Meals substation and the Valdez diesel plant substation. These substations can receive power from Solomon Gulch, the Valdez diesel plant, or the Glennallen diesel plant. The Copper Basin district is served by two substations, located at Pump Stations 11 and 12. These substations can receive power over the Valdez-Glennallen transmission line from the SGH and the Valdez diesel plant or in the opposite direction from the Glennallen diesel plant. 22 mw of CVEA's total 28 mw of installed capacity is located in the Valdez district. This capacity is continuously available only when there is adequate water in the Solomon Gulch reservoir to operate the hydro at full capacity and declines to about 12 mw at low water time. In the event of the loss of the largest unit, a 6 mw hydro unit, the Valdez district would have barely adequate capacity to serve current loads. The Copper Basin district has 6 mw of installed capacity available at Glennallen. This capacity is available except for those periods of time necessary for repair. In the event of the loss of the largest unit, a 2.5 mw reciprocating engine, the Copper Basin district would have marginal or inadequate reserve capacity to serve the current load during much of the year. The Valdez to Glennallen transmission line is vulnerable to avalanche damage from the Thompson Pass area to near Substation 12. The line has experienced two major outages due to avalanches since being energized in 1982. The first outage took almost a year to repair, and the other five days. Since it is necessary for each district to operate in a self-sustaining mode during such periods, it is absolutely essential that adequate separate capacity or transmission line access is available in both districts. Total system reliability is dependent on the strategic location of generation resources. Capacity additions, such as the proposed coal plant, Allison Lake, Silver Lake, or the recently proposed Petro Star Valdez Refinery (PS) project, may add reliable capacity to the Valdez district and the total system when the transmission line is operable but would not provide for additional or replacement capacity in the Copper Basin district in the event of a transmission line failure between Valdez and Glennallen. This circumstance has been one of the major obstacles CVEA has sought to overcome in its power supply planning. One of the primary benefits of the proposed SGL is to provide for two sources of feed for the Copper Basin district, one from CVEA's existing generation in Valdez and the other from the Railbelt interconnected system. With careful route selection, the SGL can be located in terrain that has essentially CVEA's Status and Future May 19, 1995 Page 5 no avalanche exposure. The reliability of this line is expected to be excellent. The successful completion of the SGL would allow CVEA to completely shut down the Glennallen and Valdez diesel plants and reduce the cost of operations by approximately $2,500,000 a year. Of course, there will be costs on the other side of the ledger, such as the cost of purchased power, transmission line operations, and maintenance costs. The comparison between the avoidance of existing costs and the introduction of new costs will depend, in a great measure on how the line ownership and power purchase is structured and financed. PROVISIONS FOR FUTURE LOAD GROWTH Load-growth projections in the R.W. Beck Feasibility Study are, in the opinion of CVEA, very conservative. All load-growth cases in the feasibility analysis, (low, medium, and high) project only certain specific events in the future. For instance, the essence of the low load case is the shut down of the Trans- Alaska Pipeline System (TAPS), the medium case is more or less a continuance of historic trends and the high load case includes the construction of the Trans-Alaska Gas System (TAGS). No significant consideration is given to the possibility of substantial growth in tourism as it relates to the Wrangell-St. Elias National Park. Neither is any particular significance given to the possibility of future development in timber harvest and mining. All these economic developments are likely to occur, but are not contemplated in the feasibility study. CVEA has recently completed its 1995 Power Requirement Study, which we believe has a more accurate load forecast for the CVEA service territory. A copy will be made available to you upon request. CVEA is certainly a small utility by generally accepted comparative-statistical data, i.e, number of members or meters, annual revenues, etc. However, the geographical area served and the unserved area that could potentially be served by CVEA, if a reliable and cost competitive power supply is made available, is not small. The geographical area that would logically add to CVEA's system in the future is probably second in size only to Golden Valley Electric Association in Fairbanks. This fact opens the door for unexpected and unidentified economic expansion if the proper essential services infrastructure is in place i.e., availability of adequate and competitively priced electric power is available. The load forecasts in the Beck Study do not provide for the possibility of any commercial development projects, large or small. CVEA believes that any large capital investment in new generating resources has to seriously consider the above possibilities or it could become a self-fulfilling prophecy. If an adequate and competitively priced supply of electric power is not available, there is a high probability that no substantial economic development will take place. The only resource alternative identified to date that could economically serve this load growth in CVEA's service area is the SGL. CVEA's Status and Future May 19, 1995 Page 6 BRIEF PROJECT COMPARISON Any meaningful comparison of the various projects that have been evaluated is difficult. The only common denominator is the fact that all generate some amount of electricity. Each project has characteristics that are unique to itself, and any attempt at comparison ends up apples and oranges. The project comparisons provided here are, with one exception, very brief. Please refer to the Beck Study or other information for a more detailed assessment of the alternatives. The critical factor in any consideration of alternatives, however, is an understanding of the geographic and territorial nature of the region’s power supply, demand, and existing resources. DIESEL EXPANSION CASE CVEA has been studying different approaches to a diesel expansion case for several years. An Integrated Resource Analysis funded by the State Department of Community and Regional Affairs (DCRA) and CVEA was conducted by Stone & Webster Management Consultants in 1991. The study considered a wide variety of both Demand-Side and Supply-Side resources and combinations. In the final analysis, the best integration of non-intertie resource options indicated a cost in 2009 of 33.5 to 37.7¢/kwh. Please refer to Attachment C. CONSERVATION CASE The Beck Study examined the 1991 Stone & Webster Least Cost Planning Study and reported that out of 27 conservation measures examined, only five were relevant to CVEA’s system. Items such as high efficiency refrigeration, high efficiency freezers, and energy efficient lighting were suggested. The five measures evaluated would have the potential to deliver only 550 kw of capacity displacement and 1,715 mwh of energy annually. It is obvious from this data that the Conservation Case is really only a variation of the diesel expansion case and would not provide any short- or long-term economic value to CVEA’s rate payers or to the economic development opportunities of the region. ALLISON LAKE PROJECT Some of those involved in the public discussion that has developed since the release of the final Beck Study have singled out the Allison Lake project as a viable alternative to the intertie. As a result of those uninformed assertions, we are providing a more detailed review of this project than of the others. The Allison Lake project would consist of 3 mw turbine situated between Allison Lake and Solomon Gulch reservoir. According to a Reconnaissance Study done by HDR Engineers of Bellevue, Washington, for the Alaska Energy Authority and CVEA in 1992, the project is estimated to have approximately 27,000 mw of annual energy production capability. Approximately 13,500 mwh would be generated by the water flowing through a power tunnel between Allison Lake and Solomon Gulch reservoir. The remaining 13,500 mwh CVEA's Status and Future May 19, 1995 Page 7 would be generated through the existing SGH facilities. The power generated by the SGH turbines would be subject to a 6.6 ¢/kwh charge in accordance with the Four Dam Pool agreements. The HDR study also raised several cautionary characteristics of the project that require further investigation. The study suggested that because of the small geographic area and a reduced watershed, the lake might not refill every year. HDR also raised questions about the geologic stability of the tunnel route, the possibility of debris in the bottom of the lake that could make a tap very difficult, and the effect of turbidity in the water on the Valdez fish hatchery could be devastating. Another issue raised by HDR was the water rights currently held by Alyeska. Please see Attachment D for a more comprehensive comparison of Allison Lake to the Intertie. Capacity from the 3 mw turbine would be available only when water could be discharged into Solomon Lake during the reservoir draw-down period. If water were discharged from Allison into Solomon during the fill or spill period it would become additional spill which would eliminate the opportunity to double use the water and would reduce the amount of power available from the project. The Beck Study assumes the Allison Lake project would be operable by the year 2000, and would produce 26,715 mwh of energy. The study estimates that CVEA will require 38,970 mwh of supplemental power in the medium-load case and 30,389 mwh in the low-load case, thus in the medium load case CVEA would need to generate, in addition to the Allison Lake project 12,651 mwh of supplemental power. Even in the low-load case it would be necessary to augment Allison power with 3,153 mwh of diesel generation. The study also finds that no staff reductions can be made at the Glennallen Diesel Plant because of the potential of avalanche danger to the Valdez to Glennallen transmission line. From this data, it is apparent that Allison Lake does not constitute a viable alternative generation resource from a system reliability standpoint or a prudent allocation of an estimated $32,240,000 (1993 dollars) of capital. CVEA does not concur with the Beck Study in its economic analysis of Allison Lake for the following reason. The cost of generating approximately 50% of the production attributed to the Allison Lake project at the existing SGH facility was excluded as an assignable cost to the Allison project. The basis for the exclusion by Beck was the project is owned by the State, and no incremental cost would result to the people of Alaska by running extra water through the turbines. Had this cost been included, it would have added substantially to the Net Present Value of the project thereby placing the project in a more realistic comparison with other alternatives. Refer to the Revised Economic Analysis attached as Attachment E. CVEA argued in vain that the SGH cost should be included to avoid tilting the study outcome. Our argument was based on the following facts: 1. The SGH project has been a net beneficiary of the pooling of O&M costs since the formation of the Four Dam Pool (FDP). To believe the other members of the FDP would agree to a contract amendment that would allow CVEA to generate 13,500 mwh at the SGH project at no cost indicates a lack of understanding of how that group does business. CVEA's Status and Future May 19, 1995 Page 8 Such a waiver would mean they would advocate higher rates to their rate payers than otherwise necessary to provide an additional subsidy of approximately $351,000 annually to CVEA's rate payers. 2s Of the 6.6¢ purchase price, 4¢/kwh is the "debt service component," which over many years will partially repay the State for its investment in the four hydro projects. If that portion of the rate is waived for the allocable portion of the Allison Lake power that is generated at SGH, it is our position that the cost is borne by all the people of Alaska by not being repaid for as much of their investment as possible. ACSI VALDEZ OR GLENNALLEN COAL PROJECT Alaska Cogeneration Systems, Inc. (ACSI) currently has two legal actions pending against CVEA. Detailed comment by CVEA on this option is therefore inappropriate. We would refer the review panel to the Beck Study for a complete discussion of the coal plant option. It is important to note that the current ACSI proposed coal plant would be located in Valdez and would present the same problem for system reliability as any other resource constructed in Valdez. The project would be totally dependent on the Valdez to Glennallen transmission line for delivery of power to the Copper Basin, which would necessitate keeping adequate generation in a hot stand-by status in Glennallen during the avalanche season. SILVER LAKE HYDRO PROJECT The Silver Lake project is located approximately 15 miles southwest of Valdez. Several studies have been made in past years that have all estimated the project has the ability to generate about 50,000 mwh annually. There has been a substantial difference of opinion among the studies over project costs. The Beck Study rated the project one of the higher cost alternatives, and CVEA has no basis to disagree with that finding. : CVEA does have one overriding concern with Silver Lake. The terrain between Silver Lake and SGH where it would connect electrically is extraordinarily steep and forbidding. An overhead line would be essentially impossible to construct, within acceptable economic parameters. The alternative would require approximately 18 miles of submarine cable. While the submerged power cable technology has advanced significantly in the past few years, there is still a high contingency risk involved in constructing and operating submarine transmission lines. Again, CVEA has evaluated the Silver Lake project and determined that to add the risk of a submerged transmission line to the avalanche potential for the Valdez to Glennallen transmission line does not meet acceptable reliability risk for long-range power supply planning. This factor is exacerbated by the fact that CVEA's Status and Future May 19, 1995 Page 9 the power production from Silver Lake would be needed at the time the avalanche danger to the Valdez to Glennallen transmission line is greatest, from late October to mid-May of each year. JOINT VENTURE ARRANGEMENT WITH RAILBELT UTILITIES CVEA has held a number of discussions with Chugach Electric Association (Chugach) and Alaska Electric Generation and Transmission Cooperative (AEG&T) relative to some type of joint venture arrangement for the SGL. Chugach advanced a conceptual proposal that would integrate CVEA into the Railbelt System (assuming regulatory and Railbelt members’ approval) and blend the cost of debt service and O&M into the system as a whole. Beck has estimated the impact on Railbelt rates would be approximately one mill/kwh. The beneficial impact on CVEA rates would be substantial with the possibility of reducing the cost of supplemental power from the current 15+ ¢/kwh to the average Railbelt rate of approximately 5¢/kwh. Discussions have been on hold pending the finalization of the power supply RFP process initiated by CVEA in August 1994. The AEG&T Board of Directors met with CVEA's Board on April 19, but the discussion was limited because of the outstanding RFP. Discussions with AEG&T have not produced any proposal to date. CVEA Board of Directors voted to close the RFP process on May 17. This will allow for wider ranging discussions between the interested parties. PETRO STAR PROJECT In late November 1994, Petro Star Refinery of Valdez (PS) informed CVEA that it had performed a preliminary engineering and economic study for the addition of a 4 mw combustion turbine. The turbine would be used to generate the refinery's own power and would utilize the waste heat from the exhaust gas in the crude oil heater. In this type of application, the unit is reported to achieve ninety-percent fuel efficiency. It is PS's opinion that, assuming the power produced in excess of its requirement is sold to CVEA, the economics of the project would result in a significant reduction in its operating costs. PS informed CVEA on May 4, 1995, that engineering studies have been completed, and it intends to proceed with the project as soon as the necessary air quality permit amendments can be obtained. The PS project would provide an increment of new generation that would partially displace CVEA’s current diesel generation. Because the plant will be located in Valdez and based on PS’s estimate of a maximum of 8 mw of installed capacity, it would not allow CVEA to retire all of our diesel generation. As explained, adequate reserve capacity must be maintained in the Copper Basin as insurance against a Valdez to Glennallen transmission line failure. New capacity in Valdez would not meet this need. If CVEA is to receive a benefit from the estimated lower cost of power from the PS plant, it must be able to substantially close down the two diesel plants (Valdez and Glennallen) to reduce cost. Otherwise, the addition of the PS project would become cost additive if its cost is stacked on top of the fixed costs of CVEA's Status and Future May 19, 1995 Page 10 maintaining the existing plants. PS has to consider the fact that for approximately five months each year SGH will provide essentially all of CVEA's requirements, and CVEA will not purchase energy from other sources. In addition, depending on the configuration PS actually installs it will likely be a very small increment of firm energy available to CVEA. This will obligate CVEA to continue to maintain its two diesel plants. CVEA has agreed to extend every effort to cooperate with PS to forge a win-win deal. It must be clearly understood; however, that the PS project does not add to CVEA's ability to serve future loads without continued operation of the antiquated diesel plants. The total impact of this project must be evaluated objectively if it is to achieve a maximum benefit for both PS and CVEA's rate payers, and local economic development opportunities. PROPOSED TRANS-ALASKA GAS PIPELINE SYSTEM (TAGS) In 1994 Yukon Pacific Corporation (YPC) presented an approximate three hour instruction to CVEA on the fundamentals and schedule of the TAGS. At that time YPC estimated that the TAGS could be on line by 2005 but cautioned that the date might be a little optimistic. The fact that 2005 was the earliest date the line could become operable precluded including the TAGS project in this cycle of CVEA's power supply planning, but other information presented by YPC certainly gained our attention. YPC estimated the liquefaction plant would produce waste heat adequate to generate between 50 and 100 mw of electric power. Value of the heat would be minimal to YPC. If the heat wasn't utilized for power generation, it would be exhausted into the atmosphere. It became immediately apparent that the amount of potential power that could be developed at the YPC plant was far in excess of the needs of CVEA and potentially a great asset to the Railbelt. It is also reasonable to assume that by the time the YPC plant is placed in operation, there could be a market for the power in the Railbelt. The entire scenario would greatly enhance the viability of the SGL by providing a transmission route for a substantial amount of the power to the Railbelt. In other words, assuming the SGL was in operation, the benefits of the SGL would reverse and flow to the Railbelt instead of to CVEA. The viability of both the PS and YPC projects as well as of Alyeska generation would be significantly improved with the SGL. All three projects would have an available market for power in excess to CVEA's requirements, particularly in the summer months. In the case of TAGS, it would be the difference between viability and non-viability of using that vast excess heat resource. POTENTIAL SALE/PURCHASE OF POWER TO/FROM ALYESKA We are enclosing a conceptual proposal CVEA submitted to Alyeska in July 1994. See Attachment F. This proposal combined with the information contained in the "History and Status of Power Generation Resources" provides a reasonably comprehensive summary of negotiations between CVEA and Alyeska. CVEA's Status and Future May 19, 1995 Page 11 CVEA received notice from Alyeska in October 1994 that it had deferred the decision on the restructuring of its power supply arrangement until June 1995. The decision was re-affirmed in February 1995 by the Operations Manager for the Alyeska Terminal. At that time CVEA made the decision to remove Alyeska from any direct consideration in the SGL study but to continue to evaluate the impact of possibly reaching some accord with Alyeska in an indirect manner, either directly or through PS. At Alyeska’s request, representatives of CVEA and Alyeska met on May 10, 1995. Alyeska proposed the two entities enter into a cooperative exchange of information to facilitate a meaningful comparison of costs and to evaluate the technical electrical and financial issues relevant to operating an interconnected system. A verbal agreement was reached that will allow for a free and open exchange of information. CVEA is encouraged by this development but is not able to speculate on the results, if any, that will develop from the exchange._CVEA pledged to consider any and all avenues of cooperation that would deliver a net benefit to our member/owners. SUMMARY For the past ten to 15 years CVEA has methodically and objectively evaluated all known resource alternatives that would meet the minimal criteria adopted to guide the planning process for a future power supply. The major consideration of course, is the financial assistance of the $35 million, fifty-year, zero- interest loan granted by the Eighteenth Alaska Legislature. It is obvious the loan has a tremendous positive effect on CVEA’s ability to achieve the project. Without the loan the project’s future is threatened and probably doomed. Opposition to the project has been expressed by some environmental groups and some residents of the Matanuska Valley. CVEA has made and will continue to make every reasonable attempt to mitigate their concerns. We are of the opinion that no substantial damage to the physical or aesthetic environment will result from the construction of the project. Absent an interconnection to the Railbelt System, this large region of the State will be forever hostage to high rates and lack of capacity to serve the demands of economic development. Conversely, new energy projects will also be hostage to the lack of marketing opportunities unless a transportation system can be provided. No one's crystal ball can see a clear picture of the future, but one conclusion is clear: unless an adequate electric transmission system connected to a competitively priced power source is constructed, CVEA's Status and Future May 19, 1995 Page 12 significant economic opportunities will continue to be denied to a large geographical area of the state of Alaska. In our judgment, the long-range economic viability of this region of Alaska will be determined by the Governor's decision on this project. Volumes of information and analysis support the wisdom of going forward. None, to our knowledge, factually deny the viability of the project. We urge your favorable review of this important matter. Gentlemen, if you have any questions on this paper or the SGL project, please do not hesitate to call me at (907) 822-3211. Yours truly, eal iste Clayton Hurless General Manager ATTACHMENTS: A History and Status Report B Generation Loads & Resources Cc Stone & Webster Forecast D Allison Lake to Intertie Comparative E Revised Economic Analysis F Alyeska Conceptual Proposal Attachment A Wel {=} | | f COPPER VALLEY ELECTRIC ASSOCIATION, INC. ye P.O. Box 45 P.O. Box 927 | Hy i | 06 Glennallen, Alaska 99588 . Valdez, Alaska 99686 ( i} (907) 822-3211 (907) 835-4301 HISTORY AND STATUS OF POWER GENERATION RESOURCES October 1993 a STATEMENT OF PURPOSE The purpose of this report is to educate the reader as to the history and status of power generation resources at Copper Valley Electric Association. The report will discuss the problem of high rates, existing generation resources, past efforts to develop new, affordable resources, and if successful, will give the reader an objective basis for understanding the Association’s efforts toward promoting the Sutton to Glennallen transmission line. TABLE OF CONTENTS EXECUTIVE SUMMARY BRIEF HISTORY BUSINESS TYPE AND SERVICE TERRITORY CONSUMER CLASSIFICATIONS WEATHER RATES RAILBELT SYSTEM CVEA’S GENERATION SYSTEM MECHANICAL CONDITION OF GENERATION PLANTS Solomon Gulch Glennallen Diesel Plant Valdez Diesel Plant History of the Valdez Diesel Plant LIFE EXPECTANCY OF DIESEL PLANTS CVEA’S CURRENT SITUATION Loads and Resources Power Production Cost THE SEARCH FOR COST-EFFICIENT RESOURCES The Decision to Build the Solomon Gulch Hydro Plant Birth of the Four Dam Pool Organization Conclusion on Solomon Gulch OTHER PROJECTS STUDIED Pressure Reducing Turbine in Alyeska’s Oil Pipeline CVEA Interconnection with Alyeska System Least Cost Planning Allison Lake/Solomon Gulch Integration Project Increasing the Height of Solomon Gulch Dam and Spillway Development of a Hydro Project at Silver Lake Merger with Golden Valley Electric Association Splitting CVEA into Two Systems Based on District Boundaries PAGE ES1-3 VIABILITY OF A DEDICATED GENERATION PLANT TO SERVE CVEA’S FUTURE NEEDS 11 Replace Existing Diesel Plants with New, More Fuel-Efficient Diesel Engines 12 Hobbs Industries Coal Plant 12 Natural Gas Generation 13 COMPARISON OF AN ISOLATED GENERATING PLANT TO AN INTERCONNECTION WITH THE RAILBELT TRANSMISSION SYSTEM 13 The Northeast Intertie (Sutton-Glennallen-Delta Junction) 13 Sutton to Glennallen 138 ky Transmission Line 14 Advantage of Interconnection with the Railbelt Transmission System to an Isolated Generating Plant 16 Cost of Railbelt Power at O’Neill Substation 16 1993 Legislative Action 17 The Feasibility Study Being Prepared by R.W. Beck & Associates 18 What Next 20 SUMMARY 20 INDEX OF ATTACHMENTS 21 H ACRONYM AIDEA APUC ARECA Beck Chugach CVEA DCRA DNR FDP GDP GVEA HDR KV KW O&M PEI PMC PRS PSA SGH SGL INDEX OF ACRONYMS MEANING Alaska Energy Authority Alaska Industrial Development & Export Authority Alaska Public Utilities Commission Alaska Rural Electric Cooperative Association R.W. Beck & Associates, Seattle, Washington Chugach Electric Association, Anchorage, Alaska Copper Valley Electric Association Department of Community & Regional Affairs Electric and Magnetic-Fields Department of Natural Resources Four Dam Pool Glennallen Diesel Plant Golden Valley Electric Association, Fairbanks, Alaska HDR Engineers Kilovolt Kilowatt Kilowatt Hour Megawatt Operation & Maintenance POWER Engineers, Hailey, Idaho Project Management Committee Power Requirement Study Power Sales Agreement Solomon Gulch Hydro Sutton to Glennallen Line Valdez Diesel Plant x = COPPER VALLEY ELECTRIC ASSOCIATION, INC. HISTORY AND STATUS OF POWER GENERATION RESOURCES EXECUTIVE SUMMARY Copper Valley Electric Association, Inc., (CVEA) provides central station electric service to a relatively large geographical area in Southcentral Alaska. The service area consists of the Copper River Basin communities, including Glennallen, Gakona, Gakona Village, Gulkana, Gulkana Village, Tazlina, Copper Center, Copperville, Kenny Lake, Tolsona, Mendeltna, Nelchina, Eureka, and Sheep Mountain, and the organized area of the City of Valdez. Administrative headquarters are located in Glennallen, while engineering, operations and production are managed from the Valdez district office. In 1992, residential consumers in the Copper River Basin and Valdez districts paid an average of 20.9¢ and 17.3¢ per kwh respectively. These rates are believed to be the highest unsubidized rates in Alaska. In contrast, the consumers of Matanuska Electric Association (MEA), which joins CVEA on the west, pay an average of about 10.5¢ per kwh. A part of the rate differential is due to the isolated and rural character of CVEA’s system, but the majority of the difference is attributable to the cost of power. MEA is interconnected to the Railbelt generation and transmission system and receives its wholesale power requirements from Chugach Electric Association for approximately 4.5¢ per kwh. CVEA generates all of its own power requirements with the Solomon Gulch hydroelectric plant and two diesel plants. One diesel plant is located in Glennallen (7 mw) and the other in Valdez (10 mw). For the years 1989 through 1992, CVEA generated 20%-35 % of its total power needs with diesel generation at an average cost of 15.24¢ per kwh. The other 65%-80% of the power was derived from the Solomon Gulch hydro and purchased from the State of Alaska for 6.4¢ per kwh. The blended average cost of CVEA’s total power requirement for the years 1989 through 1992 was approximately 10.0¢ per kwh, which is obviously more than double MEA’s cost. Beginning at least as far back as 1970, CVEA’s Board of Directors recognized that the diesel generation system was the major factor in the high retail rates that CVEA has to charge. They also recognized that the inherent volatility of petroleum prices and the high cost of maintaining and operating the diesels would drive rates even higher in the future. Numerous studies were conducted in an effort to identify other generating resources that would displace the need for the diesels and lower the cost of power to the member-owners. One of those studies, conducted by the U.S. Army Corp of Engineers, identified Solomon Gulch as a hydro site that had the potential to achieve the objectives of replacing the diesels and producing power at a lesser cost than the diesels. ES1 Solomon Gulch was constructed and began operation in 1982, but it has not been able to provide for all of CVEA’s needs due to an insufficiency of water beginning in October and lasting until mid to late May of each year. As stated previously, diesel generation provides the supplemental power needed, in addition to Solomon Gulch during the period of water insufficiency, to serve the load. The result is that the low utilization and efficiency factor of using the diesel plants continues to have a significant adverse impact on the overall cost of power. Beginning in 1993 and extending thereafter, Solomon Gulch will essentially be fully utilized and is projected to produce approximately 45,000 mwh annually on a conservative planning basis, requiring that CVEA be prepared to serve all new load growth with supplemental generating resources. Subsequent to Solomon Gulch coming on line and the realization that it would not produce enough power to completely displace the diesel plants, CVEA’s Board again began the search for other resources that would work well with the Solomon Gulch hydro and displace the diesels. A number of additional studies have been made which are described in the main body of this report. Until 1992, all of the projects considered fell short, in one way or another, of achieving the objectives established by CVEA. CVEA’s Board of Directors and staff identified the criteria a project must meet to fulfill the long-term requirements of the Association. The project must be able to supplement Solomon Gulch hydro during inadequate water levels, displace costly diesel generation facilities, be readily available in case of an emergency shut-down of the hydro, provide for future long-term load growth of CVEA and the communities served without periodic generation construction, have the ability to be flexible for base or supplemental loading during cogeneration periods, and provide a means for rate mitigation. In June of 1992, CVEA’s Board of Directors approved retaining POWER Engineers, Inc. (PEI) of Hailey, Idaho, to conduct a preliminary study to determine to what extent a 138 kv transmission line constructed between O’Neill Substation near Sutton to Pump Station 11 Substation near Glennallen would meet the aforementioned objectives. PEI submitted the first draft of the study in August 1992, and the preliminary conclusions were encouraging. The final report was submitted by PEI in December of 1992, and it indicated the line would transfer up to 40 mw of power to Pump Station 11 Substation at a cost of approximately $40.5 million. In January of 1993, CVEA entered into a Memorandum of Agreement with the Alaska Energy Authority (AEA) to conduct an in-depth independent feasibility study of the proposed project. AEA subsequently retained R.W. Beck & Associates of Seattle, Washington, to conduct the study, which is currently in progress. CVEA, with the help of the Alaska Rural Electric Cooperative Association, the City of Valdez, and the Greater Copper Valley and Valdez Chambers of Commerce, and others, launched a concerted lobbying effort in the 1993 session of the Alaska Legislature to obtain State assistance in funding the project. The Legislature approved and appropriated $35 million for a 50-year, zero interest loan, subject to acceptance of the aforementioned detailed feasibility study by the Department of Community and Regional Affairs. The Legislature also approved the issuance of up to $25 million in bonds by the Alaska Industrial Development and Export Authority to fund a supplemental loan to CVEA for the balance of the cost of line. ES2 AEA and R.W. Beck have held two rounds of public meetings in the communities of Sutton, Chickaloon, Glacier View, Glennallen, and Valdez to receive public comment and concerns. Another round of meetings will be held in late October or early November to receive comments on the final draft feasibility study. Significant changes have been made in the routing of the line in response to public concerns. Other changes may be made as a result of the final public meetings. The routing changes made to date have increased the cost of the line substantially; however, CVEA feels they are necessary and justified to demonstrate a good faith effort for public support of the project and to accommodate, where possible, expressed public concerns. The transmission line is the only project considered to date that fundamentally achieves all of the objectives that CVEA has established. It is a large project, but with the State’s help in funding, it is achievable. When completed, it will provide a wide range of long-term benefits to the member-owners of CVEA through expanded economic development opportunities, an improved quality of life by making electricity more affordable, and a long-term, reliable power supply that works well in coordination with the Solomon Gulch hydroelectric plant. When constructed, the Sutton to Glennallen transmission line will not be an end to CVEA’s efforts of providing least-cost central station service to those Alaskans desiring it. Rather, it will be a new beginning for the organization as well as all the communities served. Beginning with rate mitigation, it will provide a cost effective alternative to local residents who currently generate their own power or live without electricity. The expansion and development possibilities could be endless. Communities could begin fulfilling their goals to entice new businesses into the area when electrical costs become more economical. This project could make electricity the power of choice, thereby improving the quality of life for the people living in the Copper River Basin and the City of Valdez. ES3 COPPER VALLEY ELECTRIC ASSOCIATION, INC. HISTORY AND STATUS OF POWER GENERATION RESOURCES BRIEF HISTORY Copper Valley Electric Association, Inc. (CVEA) was organized in the Copper River Basin during the mid-1950’s and was energized in 1959, initially serving 38 consumers over 48 miles of line. Subsequent to the 1964 Alaska Earthquake, CVEA acquired the Valdez Power Co. from a private owner who did not have the means or desire to rebuild the badly damaged system or to construct the new system needed to serve the relocated townsite. CVEA has grown from that very modest beginning to its present size of nearly 3,000 consumers, representing 8,000-9,000 Alaskan residents who, according to CVEA’s Power Requirement Study (PRS) dated January 5, 1993, are projected to use 74 million kwh annually. These consumers are served over 333 miles of distribution line owned by CVEA and 106 miles of 138 ky transmission line owned by the State of Alaska and operated by CVEA. CVEA’s total assets on December 31, 1992, were $20,406,205, with a consumer equity of $7,371,780, or 36.1%. BUSINESS TYPE AND SERVICE TERRITORY CVEA is a member-owned electric cooperative serving a relatively large geographical area in the Valdez and Copper Basin regions of Southcentral Alaska. CVEA’s service territory is divided into two districts, the Valdez district and the Copper River Basin district (hereinafter referred to as the Copper Basin). The Valdez district boundaries are generally synonymous with the organized area of the City of Valdez. The Copper Basin district covers a relatively large land area within the Copper River Valley and includes the communities of Gakona, Gakona Village, Gulkana, Gulkana Village, Glennallen, Tazlina, Copper Center, Copperville, Kenny Lake, Tolsona, Mendeltna, Nelchina, Eureka, and Sheep Mountain. Administrative headquarters are located in Glennallen in the Copper Basin district. Engineering, operations, and power production are managed out of the Valdez district office. The distribution service area extends from: Alyeska Pipeline refrigeration site number 1, Mile Post 156 Richardson Highway, south to mile 61. All of Valdez and extending north to Mile Post 12 on the Richardson Highway. 80 miles east on the Glenn Highway from Mile Post 109 to Glennallen. East on the Tok Cutoff from Gakona Junction to the Alascom tower at Mile Post 12. East from the Junction of Highways 4 and 10 to Mile Post 18 on the Edgerton Highway near Chitina. CON: ER CLASSIFICATIONS CVEA serves six classes of consumers comprised of residential, small commercial (50 kva or under), large commercial (50-1,000 kva), large power (over 1,000 kva), street lighting systems, and public buildings. A tabulation of the projected number of consumers by rate class and their approximate annual energy requirements as reflected in the PRS are presented in the following table. Classification # of Consumers Residential 2,291 15,014,000 Small Commercial 452 10,062,000 Large Commercial 69 : 28,278,000 Public Street Lighting dunn S ef Petro Star 1 : 19,710,000 74.228.000 WEATHER The Valdez district is impacted by a cool, wet, coastal maritime weather system that provides an average of about 65 inches of precipitation annually, mostly in the form of snow which averages 300 to 350 inches of annual accumulation. Temperatures in the Valdez district generally range from +10°F in the winter to the high sixties in the summer. There are temperature variations outside of this range, but winter days below zero and summer days above 75°F are rare. The Copper Basin district is situated approximately 60 miles inland from Valdez and extends into the interior from the coast about 160 miles. The Copper Basin district has a very different weather pattern than the Valdez district. Annual precipitation averages 11 to 12 inches, and temperatures range from -60°F to a high of +95°F. RATES CVEA’s member-owners pay some of the highest unsubsidized retail rates in Alaska. In 1992, residential consumers in the Copper Basin and Valdez districts paid an average of 20.9¢ and 17.3¢ per kwh respectively. Residential rates are approximately double those paid by the consumers of the Alaska Railbelt utilities. A part of the difference in rates is attributable to the low density and isolated nature of CVEA’s system, but the largest factor is the difference in the cost of purchasing and generating power to serve the power requirements of CVEA’s members. RAILBELT SYSTEM The Railbelt utilities (consisting of Chugach, Matanuska, Golden Valley, and Homer Electric Associations, City of Seward Light & Power, and Anchorage Municipal Light & Power) are all cooperative or municipal electrical utility systems that are interconnected to one large transmission and generation system. The interconnected system provides for the efficient scheduling and utilization of available generation and transmission resources. The Alaska Energy Authority (AEA) and each of the utilities own some part of the system. Chugach Electric Association (Chugach) is the largest of the Railbelt utilities and, with one exception, provides all or a part of the power supply requirements to the other participating utilities. The Alaska Systems Coordinating Council reported in its April 1993 "Coordinated Regional Bulk Power Supply Program Report" that the Railbelt utilities have projected a 1994 summer peak hourly demand of 544 mw against a total available summer capacity of 1,176 mw. The report projects a winter peak hourly demand in the winter of 1994/1995 of 649 mw against a total available winter capacity of 1,284 mw (see Attachment A). Cost of generation and purchased power for the Railbelt utilities varies from 314-5¢/kwh. CVEA’S GENERATION SYSTEM CVEA’s power supply is provided by a stand-alone generation system (not interconnected to any other utility) comprised of two diesel plants owned by CVEA and the 12 mw Solomon Gulch hydro plant (SGH) owned by the State of Alaska and operated by CVEA under a long-term contract. Total prudent operating capacity of the two diesel plants is approximately 14.5 mw. Water, operational, and maintenance constraints reduce the total system installed prudent operating capacity from 26.5 mw to a low of approximately 16 mw in May. CVEA’s projected 1994 peak demand is 12.2 mw. SGH has a nameplate capacity of 12 mw but, due to the low ambient temperatures in Valdez, has the capability of operating 10% over nameplate without any detrimental effects on the generators, thus increasing the capacity of the plant to 13.2 mw, subject to the availability of water in the reservoir. Although the nameplate capacity of SGH exceeds CVEA’s requirements, that capacity is only available for four months out of the year due to the lack of water in the reservoir (see Attachment B). SGH has historically provided all of CVEA’s power requirements from mid to late May until early to mid October. For the four-year period 1989 to 1992, hydro production has varied from a low of 40,000 mwh to a high of 46,700 mwh. As a conservative planning base, CVEA projects that SGH will be able to produce 45,000 mwh annually through various weather and usage patterns. This is estimated to be the maximum dependable production from SGH, which will require CVEA to be prepared to serve all additional new load growth with supplemental generating resources. During the October to May period when SGH will not provide 100% of energy requirements, the two diesel plants meet the balance of CVEA’s requirements. For the past four years, the diesel supplement has ranged from 13,000 mwh to 21,000 mwh. The addition of the Petro Star Refinery in early 1993 is expected to add 19,710 mwh to CVEA’s total load and is projected to increase the diesel supplement to 35,000 mwh. As stated above, from 1993 on CVEA will have to be prepared to serve all new load growth from non-hydro resources. If future load growth tracks CVEA’s 1993 PRS, supplemental requirements will grow to 55,000 mwh in the year 2003 and 72,000 mwh in the year 2013. MECHANICAL CONDITION OF GENERATION PLANTS Solomon Gulch SGH is in excellent condition and can be expected to operate into the indefinite future with normal maintenance. The plant was brought on line in 1982 and has a reasonable life expectancy of 50 to 75 years. Glennallen Diesel Plant The Glennallen diesel plant (GDP) is made up of seven reciprocating diesel engines: two 300 kw, 1959 vintage Fairbanks Morse; one 1963 and two 1966, 600 kw Fairbanks Morse; and two 1975, 2,624 kw Enterprise units. The two 1959 Fairbanks Morse units are not included in the total capacity available. The unavailability of parts and the prohibitive cost of having them special made prompted the decision several years ago not to continue scheduled major maintenance on the units. Both units are operational in an emergency but are not considered to be sufficiently reliable to be classed as a base resource. For the past several years, the GDP has been used as the primary supplemental generating resource and has been maintained to an acceptable standard of reliability, albeit at an increasing cost each year. Valdez Diesel Plant The Valdez diesel plant (VDP) is comprised of six reciprocating diesel engines and one turbine: three 1966, 600 kw Fairbanks Morse; one 1972, 1,900 kw Enterprise; one 1975, 2,600 kw Enterprise; one 1952, 965 kw Enterprise; and one 1976, 2,800 kw SOLAR turbine. The VDP is presently maintained to an acceptable standard of reliability with all units available for base load operation. History of the Valdez Diesel Plant When SGH was brought on line in 1982, the VDP was essentially placed in mothballs. At the time of mothballing, the plant was not in very good condition due to the deferral of maintenance in anticipation of SGH becoming operational. In 1990, Petro Star Valdez, Inc. (a joint venture of Petro Star North Pole, Petro Marine, and Alaska Refining, Inc.) began discussions with CVEA regarding electric service for a 30,000-barrel-per-day refinery they were proposing to build near Valdez. 4 As those discussions progressed, CVEA began assessing its generating resources and how it could meet the additional load should the load materialize. As a result of that assessment, it was determined that the only cost effective method to serve the new load, in the short term, was to bring the VDP back into reliable operating condition. Extensive maintenance was performed on the plant in the summer of 1992, and it was integrated into the generating mix in the fall of 1992. Further maintenance has been performed in 1993. With the addition of the Petro Star load in January of 1993 and other system load growth, the VDP will provide a larger share of the supplemental generation requirement. LIFE EXPECTANCY OF DIESEL PLANTS There are two basic criteria for establishing the life expectancy of any piece of equipment--mechanical and economic. If operating and maintenance costs are disregarded, the mechanical life of a diesel generating plant could theoretically be extended indefinitely. When operational and maintenance costs are plugged into the equation to determine the economic life (the cost viability of continuing to operate the plant), several questions have to be addressed. The first question is how do total costs of operating the diesel plants compare with available alternatives? The answer to this question is straightforward--there is not currently an existing alternative resource available at any price. Secondly, what is the best estimate of future cost, including fuel and maintenance, to operate the plants? The answer to the second question is not so straightforward. Attempts to accurately project future prices, particularly oil prices, are subject to world political stability and unforseen market forces. Prices over time have trended up, and conventional wisdom seems to provide that the upward trend will continue. The possibility of political unrest somewhere in the world causing skyrocketing prices is an ever-present specter. The cost of maintenance on CVEA’s diesel plants will undoubtedly continue to increase. In the past two years, it has been increasingly difficult to find "shelf" parts for the engines. As a result, some parts have to be special made at a cost that is significantly higher, in some cases two or three times higher, than "shelf" parts had they been available. Therefore, it is reasonable to conclude the cost of operating the diesel plants will continue to increase, but to what extent is unknown. In addition to the rising cost of operation and maintenance as the machines age, the risk of a catastrophic mechanical failure increases. Such a failure can render the equipment inoperable for significant periods of time and, depending upon the nature and extent of the failure, can conceivably make a repair uneconomical. In that eventuality, CVEA would be forced to acquire short-term generation capability at a substantially higher cost. The third question is what is the capability of the diesel plants to serve the existing and future loads of CVEA? The answer to this question is relatively straightforward--very limited. CVEA did an in- depth assessment of its generating resources in 1992 and concluded that if the diesel plants were maintained in reliable operating condition, the existing and short-term future loads could be served. This conclusion was based on the assumption that load growth would be within a reasonable variance of the projections of the current PRS and no new large loads (500 kw or above) would come on line. Short-term was defined as not more than five or six years. In summary, the useful life of CVEA’s diesel generating plants will be determined by the availability of more cost-efficient resources. If there is not an available alternative, the diesel plants will have to be maintained and operated. In this instance, the cost of maintenance and fuel become an unavoidable cost CVEA will have to endure in order to meet its "utility responsibility" to serve all existing and future loads within its franchised service area. It is a near absolute certainty that CVEA will make every possible effort to meet its “utility responsibility," which will not only make it necessary to maintain the existing diesel plants but possibly add additional diesel generators in the event of significant unexpected load growth. CVEA’S CURRENT SITUATION Loads and Resources CVEA’s peak system demand is projected to approach 12 mw in 1993, with total projected sales of approximately 74,000 mwh. It is anticipated that Petro Star will solve their barge loading problem in 1994, and the growth in their load, plus other system load growth, will increase the total demand to 12+ mw in 1994 and to 13.4 mw in 1997. Power Production Cost Power produced at SGH is purchased from the State of Alaska. SGH is operated by CVEA under a long-term contract in coordination with three other state-owned hydro projects through the Four Dam Pool (FDP) Project Management Committee. The FDP is comprised of five purchasing utilities (City of Wrangell, Petersburg Municipal Power & Light, Ketchikan Public Utilities, Kodiak Electric Association, and CVEA) and ABA. The purpose of the FDP is to coordinate the planning, budgeting, operation, and cost pooling of four state-owned hydro projects (Swan, Tyee, and Terror Lakes, and Solomon Gulch). Operation and maintenance (O&M) costs are pooled and averaged for all the projects. The average O&M cost for fiscal year (FY) 1994 is set at 2.4¢/kwh. In addition to the O&M cost, the State of Alaska collects 4¢/kwh "debt service cost," making the total cost of SGH power 6.4¢/kwh. Production costs at the two diesel plants can vary substantially from year to year primarily due to changes in fuel and maintenance costs. The average cost of production of both plants for the four-year period 1989 through 1992 was 15.24¢/kwh. CVEA expects some reduction in this average cost for the next two or three years due to the inherent economies of scale that should result from an increase in production of diesel generated kwh. For the same period, 1989 to 1992, CVEA experienced a blended average cost per kwh sold of 9.99¢ for all power produced with the diesel plants and purchased from SGH. THE SEARCH FOR COST-EFFICIENT RESOURCES CVEA’s Board of Directors and management have recognized, since as early as the 1970’s, that at some point it would become necessary to replace the diesel plants. It was inevitable then, as it is today, that the plants would become uneconomical to operate. CVEA has long been aware that alternative. generating resources should be identified and integrated into the system if the extraordinarily high rates paid by CVEA’s member-owners were to be reduced or at least stabilized. This awareness was the catalyst that prompted a series of studies beginning in the early 70’s in the search for more cost-efficient resources. Several studies were conducted by the federal government, the State of Alaska, and CVEA. The most comprehensive of those studies was one conducted by the Corp of Engineers titled "Southcentral Alaska Railbelt Area, Hydroelectric Power and related Purposes for Valdez, Alaska" published in 1976. That study identified Solomon Gulch and Allison Lake as the best sites of those investigated for the development of a hydro resource to serve the needs of CVEA’s members. At the time the project was conceived, it was anticipated SGH would meet essentially all of the power requirements of CVEA and the diesel plants could be placed in some degree of standby. The Decision to Build the Solomon Gulch Hydro Plant Based on the aforementioned study and additional engineering and economic studies, CVEA’s Board of Directors made the decision in 1978 to go ahead with the SGH project and applied for a Rural Electrification Administration (REA) loan. The loan was approved, and construction was started in 1980. During the course of construction, the project experienced significant cost overruns, which posed a serious threat to CVEA’s ability to complete it due to the shortage of funds. Birth of the Four Dam Pool Organization Three other hydro projects (Swan, Tyee, and Terror Lakes), which either had been or were being built in the state at the same time the SGH project was being constructed, were also experiencing similar financial problems. To resolve the problems, the State of Alaska intervened. It paid off the accumulated debt, completed the projects, and orchestrated the formation of the FDP organization to coordinate the operation of the projects. Cost of the completed projects totaled $499,987,790, of which the legislature approved $307,987,790 as grants. The balance of $192,000,000 was classified as loans to the projects, which are being repaid over a long period of years by the 4¢/kwh debt service charge. For the first 15 years, the agreements provide the 4¢/kwh is an interest charge only, which means there is not any reduction in the principle. The term of the Power Sales Agreement is 45 years from the execution date in 1985. In addition to the PSA, the participants have entered into a number of other agreements that interpret and define the relationship of the five utilities and AEA. Taken in total, they tie the parties together in a complex legal web until the expiration of the Power Sales Agreement in 2030. Any significant action proposed by one of the members that changes or modifies the PSA requires the unanimous approval of all six parties to the agreement. Conclusion on Solomon Gulch Even though SGH has not lived up to its original expectation in terms of energy production, it is a valuable part of CVEA’s generating resources. It provides a number of important benefits to CVEA’s member-owners. 1. When there is sufficient water, it provides lower cost power than can be generated with the diesels. 2. During the period of water insufficiency, it provides some power that has a favorable mitigating effect on the total cost of generation. 3: It provides a very important insurance policy to the Valdez district during the avalanche season if the Glennallen to Valdez transmission line should be out of service. 4. Should the proposed Sutton to Glennallen intertie line (SGL) be put into operation, SGH will provide an invaluable capacity component and voltage support system to assure a high quality of service to the consumers. OTHER PROJECTS STUDIED Subsequent to SGH being completed and operational, CVEA’s Board of Directors and Staff continued the search for new cost-effective resources that would integrate well with SGH and replace the diesel plants. For the past ten years, CVEA has committed considerable time and resources to assessing additional projects that would further the ultimate goal of rate reduction. Following is a brief review of those projects and ideas. Pressure Reducing Turbine in Alyeska’s Oil Pipeline At the request of CVEA, Alyeska Pipeline Service Co. and CVEA conducted a joint study on installing a pressure reducing turbine in the pipeline below Thompson Pass. For. technical reasons, Alyeska determined it could not permit the turbine to be installed. CVEA Interconnection to Alyeska System There has been ongoing discussion between CVEA and Alyeska for a number of years relative to interconnecting the two systems between SGH and Alyeska’s powerhouse at the TAPS terminal. ; The discussion period has spanned the terms of at least four CVEA General Managers and three Alyeska Terminal Managers. Alyeska has consistently determined that such an interconnection is not in their best interest, primarily because of their concern that they would be classed as a public utility and be regulated by the Alaska Public Utilities Commission (APUC). In 1988, CVEA and the Alaska Rural Electric Cooperative Association (ARECA) were successful in effecting legislation that specifically exempted Alyeska from the jurisdiction of APUC. Even with that exemption, Alyeska has continued to decide against interconnection on the premise that the State can undo what it has done and, consequently, Alyeska is not willing to run the risk of being regulated as an electric utility. Recently, CVEA obtained an estimate of Alyeska’s generating cost that indicates their cost of generation may be higher than CVEA’s. The information appears to be reasonably accurate because Alyeska generates with three 1214 mw oil-fired steam turbines, which are known to be fuel inefficient. Assuming the information is accurate, CVEA would not receive any benefit from interconnection unless Alyeska decided to sell power at less than their cost of production. As oil throughput declines in the pipeline, Alyeska has been in the process of cutting personnel and operating costs, which makes it unlikely that they would decide to provide power to CVEA at less than cost. Least Cost Planning In 1990, the Department of Community & Regional Affairs (DCRA) and CVEA jointly retained Stone & Webster Engineering to do an Integrated Resource Study, or “least cost" plan. The study analyzed opportunities to solve CVEA’s problem through both a "demand side" and a "supply side" model. On the demand side, CVEA’s rates are so high that the consumers’ frugality in the use of electric energy has essentially eliminated the opportunity for any measurable additional conservation. On the supply side, the conclusion reached was to research new cost-effective generation or transmission. The study recommended that a rubber dam or a new, more efficient remote-controlled diesel plant were the two options worthy of consideration. From that recommendation, CVEA initiated the studies of those two options. Allison Lake/Solomon Gulch Integration Project In 1992, AEA commissioned HDR Engineers (HDR) to conduct a feasibility study and cost estimate for integrating Allison Lake with SGH by means of a two-mile tunnel to transfer water from Allison Lake to Solomon Lake during the October to May period of water insufficiency. The project cost was estimated to be $30,937,257, not including interest during construction. The project was designed to add a small powerhouse at the Solomon Lake reservoir that would utilize the Allison Lake water as it flows into Solomon Lake to produce 3 mw of capacity and displace an estimated 26,745 mwh of diesel-generated energy annually. The project indicated a benefit to cost ratio of 1.70 over its economic lifetime. The decision was made not to pursue the project based on its inability to produce adequate energy to retire the diesel plants and because the estimated cost of 13¢/kwh was only slightly less than diesel cost. Increasing the Height of Solomon Gulch Dam and Spillway In 1991, CVEA retained HDR to produce a feasibility study and cost estimate to increase the height of the Solomon Gulch dam and spillway to provide increased water storage. The Rubber Dam Option: The study estimated a five-foot rubber dam would cost $1,547,548 and produce an additional 1,702,000 kwh annually. CVEA assessed the project and determined that it would only produce approximately 5-6% of the supplemental generation needed in 1995 at a kwh cost about equal with diesel generation. Based on that finding plus the uncertainty of the Federal Energy Regulatory Commission requirement for amending the project license, it was determined the project should not be pursued. Raising the Dam with Concrete and Earth: The 1992 HDR Allison Lake study commissioned by AEA required the preparation of a cost estimate to raise the Solomon Gulch dam and spillway 32 feet with concrete and earth. HDR estimated this project would cost $27,796,984 and would produce 15,040 mwh of energy at a cost of 15.59¢/kwh. Again, the project was not pursued because it was not capable of producing enough energy to allow the diesels to be retired and the cost was actually higher than the cost of diesel generation. Development of a Hydro Project at Silver Lake As a part of the Allison Lake study, AEA asked HDR to produce a cost estimate for the development of a hydro project at Silver Lake. Silver Lake is approximately 15 miles southeast of Valdez at the head of the Duck River. The extremely rough terrain between Silver Lake and Solomon Gulch would require the use of a submarine transmission line to tie the project to CVEA’s system. Such lines are not only expensive to install but also have inherent maintenance and reliability concerns. HDR estimated the project cost at $70,107,626 in 1995 dollars. They estimated a levelized annual cost of 14.7¢/kwh for the total cost of operation and amortization. The project would be capable of producing 14 mw of capacity and an estimated annual energy of 48,750 mwh. The project would make it possible to retire the diesels in the short term, but its high cost would not provide any opportunity to reduce rates to CVEA’s members. 10 Merger with Golden Valley Electric Association In 1987, Golden Valley Electric Association (GVEA) and CVEA conducted an in-depth study of consolidating the two utilities to determine if the CVEA system could be absorbed into GVEA to facilitate a rate reduction for CVEA’s consumers without a significant adverse impact on the rates of GVEA’s members. After considerable discussions, the negotiations ended in August 1989 when the GVEA Board President, Ronald Bergh, wrote a letter stating, "This is not the time to further pursue a merger of CVEA and GVEA." After surveying the membership, CVEA’s Board concurred with GVEA to discontinue merger negotiations. Splitting CVEA into Two Systems Based on District Boundaries CVEA and the City of Valdez conducted an in-depth study of the beneficial and detrimental aspects of splitting the service territory into two systems based on district boundaries. The study found the duplication of equipment, personnel, and administrative costs that would occur as a result of the split would increase rates for both districts. It also revealed it would be extremely difficult to arrive at a mutually acceptable agreement for the split of existing physical plant and other assets. VIABILITY OF A DEDICATED GENERATING PLANT TO SERVE CVEA’S FUTURE NEEDS The numerous studies that have been done by or for CVEA over the past 20 years that have analyzed a significant number of projects and propositions in an attempt to identify a cost-effective alternative to the diesel plants have revealed one very important factor. The construction of a dedicated and isolated generating plant (not able to interconnect to a transmission grid) to meet CVEA’s supplemental requirements, regardless of its fuel type, cannot be used efficiently nor will it provide an immediate or long-term opportunity to mitigate CVEA’s high rate problem, for the following reasons: 1. The plant would have to have the capability to produce capacity and energy greater than CVEA’s current peak load requirements in order to meet the peak demand and accommodate some increment of load growth. The capacity required to meet peak load would only be required for a short period of time when SGH reservoir is drawn down, usually in late May. The balance of the year, SGH will provide some amount of power, and for four to five months, as mentioned earlier, it will provide all of CVEA’s current power requirement. 2. A plant that would just meet CVEA’s peak demand, if brought on line in 1995, could be utilized to a maximum of 47% of its production capability in a year of low precipitation. In the more likely year of average precipitation, the plant would experience a utilization factor of 36%. Neither represent an efficient use of capital. As CVEA’s load grows in the future, the situation gets worse rather than better. Additional capacity would have to be added at a higher unit cost. The utilization factor would be further reduced because of the short period of time the full capacity is needed. If new units are not added, it would be necessary to revert back to the old diesels. Either of those actions would inevitably increase the unit cost of production. 11 ou A plant being operated in a subordinate role to SGH needs to have the flexibility to efficiently meet a wide variety of load requirements. At the beginning of the period of hydro insufficiency, a plant has to be able to respond to whatever scheduling requirement is dictated by the weather or inflow into SGH reservoir. Replace Existing Diesel Plants with New, More Fuel-Efficient Diesel Engines In 1990-1991, CVEA assessed the possibility of building a new, expandable diesel plant. The plant would initially have two 3.6 mw Caterpillar or Wartsilla remote-controlled diesel generators. Consideration was given to building the plant next to the new Petro Star Refinery at Valdez with a direct piping connection to the refinery that would save the freight on the fuel. The initial plant was estimated to cost between $10 and $12 million, including land, substation, auxiliary equipment, and buildings. The generator building was designed to add one additional unit at an estimated cost of $3.5 to $4 million. A number of projections were prepared using different assumptions for load growth, increases in fuel cost, maintenance, operation, and the cost of emissions control upgrades that would be required. Of the projections made, the best case predicted a modest increase in rates, and the worst case predicted CVEA’s rates could increase into the mid 30¢/kwh range in ten to 15 years. The phased replacement of the existing diesel units over a considerable period of years would require the existing plants to be kept operational, which would eliminate any opportunity for rate mitigation. Hobbs Industries Coal Plant Hobbs Industries of Anchorage, Alaska, has submitted a proposal to AEA to construct and operate an 11 mw coal-fired plant in Glennallen to provide CVEA’s supplemental power generation requirements. The project has been incorporated in the SGL feasibility study being conducted by R.W. Beck & Associates of Seattle, Washington (Beck). The coal plant proposal has a number of apparent problems in terms of its ability to serve the supplemental power requirements of CVEA. 1. The original capacity of 11 mw would only be sufficient to serve CVEA’s current requirements. As load grows in the future, it would be necessary to add additional units or revert back to the diesel plants. Neither of these options would meet the long-term goals set by CVEA to eliminate its dependence on the diesel plants in order to reduce its retail rates and provide for future economic development opportunities within the service area. 2. The proposal stipulates the diesel plants would be required to back up the coal plant for up to 200 hours of unscheduled outage time per year. This limitation mandates that the diesel plants be maintained in hot standby readiness. 12 35 The plant has zero diversity, i.e., it originally is comprised of one boiler, one turbine, one generator, etc. Should the smallest component critical to the plant’s operation fail, the entire plant will go down. 4. The plant's ability to serve the small increments of power needed in the shoulder periods of CVEA’s load shape is questionable, which could cause additional dependence on the existing diesel plants. Ds The boiler unit of the proposed plant would be a "refurbished" unit built in 1956 and used in Chugach’s Ship Creek plant until the late 1970’s. The boiler was initially fired with coal and later converted to natural gas before it was declared obsolete by Chugach and sold in 1986 to Slana Energy. The age and use factors alone create a reasonable question of the unit’s ability to operate efficiently and reliably. Natural Gas Generation A number of statements were received during the public comment meetings on the Sutton to Glennallen line that there is a known large field of natural gas in the Copper Basin. It was suggested that CVEA should develop a natural gas resource not only to generate power but to provide low-cost gas to the residents of its service area. Other comments were made that CVEA should wait until the natural gas pipeline was built from the North Slope to Valdez. In order to respond to those comments, CVEA contacted the Oil and Gas Division of the State Department of Natural Resources (DNR) relative to the possibility of natural gas in the Copper Basin and also met with the Yukon Pacific Corporation, who holds the environmental permits for the gas pipeline. Information received from the Oil & Gas Division of DNR is attached and indicates that no known commercial-quality deposits of natural gas are identified at this time (see Attachment E). Yukon Pacific, while optimistic of their future chances of constructing the gas pipeline, were cautious about how long it would take them to get all of the purchase and sales contracts in place. Their most optimistic forecast would put the line in service in 2002-2005, well beyond the period of time CVEA has to decide how it will improve its power supply resources. CVEA does not believe that either of these two possibilities have sufficient merit to justify any substantive study. COMPARISON OF AN ISOLATED GENERATING PLANT TO AN INTERCONNECTION WITH THE RAILBELT TRANSMISSION SYSTEM The Northeast Intertie (Sutton-Glennallen-Delta Junction) In the late 1980’s, AEA commissioned a major reconnaissance study, published in June of 1989, to determine the feasibility of constructing a large capacity 230 kv intertie line from Sutton to Glennallen and on to Delta Junction. The line was envisioned to accomplish a number of important objectives but primarily to provide loop feed reliability to Fairbanks and other Interior communities. 13 There are other significant benefits to the line, such as providing CVEA with an unlimited supply of much more economically priced power from the Anchorage Bowl, upgrading service to the military installations along the Richardson Highway, and providing the basic electrical infrastructure to encourage future economic development in the resource rich Interior. The study produced a preliminary cost estimate of $156 million in 1989 dollars. In 1990, the Alaska Legislature considered the overall cost and feasibility of the proposed intertie project and decided it would not be possible to fund the entire line in the short term. In view of that decision, the line was divided into two segments, the Southern Leg (Sutton to Glennallen) and the Northern Leg (Glennallen to Delta Junction). For reasons not fully understood, it was decided to concentrate first on the Northern Leg. That segment was estimated to cost $95 to $100 million in 1989 dollars. The project was reintroduced to the 1991 Legislature, and a concerted effort was made to gain legislative support for funding the Northern Leg. However, due to the effect of declining oil revenues on state revenues, the effort was not successful. The State administration and legislators at that time were of the opinion that unless another major windfall in state revenue was forthcoming, it would be unlikely that projects of the magnitude of the Northeast Intertie could be funded anytime in the near future. CVEA renewed the effort to obtain funding in the 1992 legislature, but the effort was also unsuccessful for the same reasons as in 1991. It is widely known that the Northeast Intertie would yield significant future benefits to both the current Railbelt utilities and those utilities that would become a part of the Railbelt, such as CVEA. The additional sales of energy would help keep rates of the existing Railbelt utilities lower than they otherwise would be. The access to lower priced Railbelt power could provide opportunities for the expanded use of electric energy and the resulting improvement in the quality of life for CVEA’s consumers. It would also provide new and expanded economic development opportunities for all the people living in the large geographic area of Southcentral Alaska that would be served by the line. Sutton to Glennallen 138 kv Transmission Line Following the adjournment of the 1992 Alaska Legislature, CVEA elected to reassess its power supply strategy to determine if any option had been overlooked that would meet the necessary criteria to reduce or, at the very least, stabilize CVEA’s rates and provide adequate reserves for reasonable long-term load growth. It was suggested that CVEA look into the cost of constructing a smaller capacity line in lieu of the proposed Northeast Intertie between Sutton and Glennallen. The rational was that such a line could provide for CVEA’s long-term needs and be economical enough to construct and operate. If a meaningful reduction in capital cost of the line could be achieved, it would appreciably improve the possibility that a funding package could be put together. 14 Bi CVEA discussed the concept with other utility directors, managers, engineers, and AEA, who all believed the idea had possible merit. In July of 1992, CVEA’s Board of Directors approved retaining Power Engineers, Inc. (PEI) of Hailey, Idaho, to conduct a preliminary screening study to determine if a smaller line would be feasible. PEI was instructed to consider the following criteria for the study parameters: itt Calculate the capacity of the line within acceptable voltage drop limitations to assure it was adequate to allow the diesel generators to be placed in cold standby for emergency use only and ensure the line would have capability to serve the economic development needs and long-term load growth of CVEA’s service area. ox Determine the annual cost to assure it would not impact CVEA’s rates adversely with emphasis on identifying design criteria and construction methods that could possibly reduce rates. os Adopt design criteria that would achieve a usable and reliable life expectancy of at least 50 years. 4. A line constructed ta.a high standard of reliability without losing sight of the cost of construction. The initial draft study indicated the line had the potential to meet this criteria, and in September of 1992, CVEA’s Board of Directors approved extending the study to test the validity of the assumptions used in the preliminary study. CVEA and PEI asked Chugach, Matanuska Electric Association, AEA, and two large general contractors to review the first study and participate in a technical review meeting with the purpose of identifying any errors in assumptions or engineering decisions that would not work in the Alaska environment. The utilities and contractors were very cooperative in their response. The time and effort they put into the review was of invaluable help in objectively assessing the assumptions that were being used to develop the cost estimate. With the data and advice obtained at the meeting, PEI revised the initial draft and published a final study in December 1992. That study has provided the basis upon which CVEA has proceeded to date. The PEI study found that a 138 kv transmission line could be constructed between O’Neill Substation near Sutton to Pump Station 11 Substation near Glennallen at a cost of approximately $40.5 million. The line would be able to transfer up to 40 mw of power. The line would meet all of the criteria established by CVEA. It would be capable of meeting all of the supplemental generation needs and provide for additional load growth into the indefinite future. It would accomplish the major goal of providing reliable capacity, which would allow the existing diesel generators to be placed in cold standby for use only in emergencies. PEI estimated the annual maintenance and operation cost would be approximately 1% of the actual construction cost of the line. Based on their latest cost estimate, that would equate to about $300,000 per year, or less than 1¢/kwh for the anticipated transfer of 39,000 mwh in 1995. 15 Debt service on the line is the one item that has caused some concern from the outset. Debt service on a $40.5 million loan at the current REA-CFC blended interest rate of 5.8% amortized over 35 years would be $2,728,243 annually, or 7.0¢/kwh for 1995’s supplemental power requirement of 39,000 mwh. Advantage of Interconnection with the Railbelt Transmission System to an Isolated Generating Plant The advantages to CVEA becoming interconnected to the Railbelt transmission system are significant. The following list is not exhaustive but provides a basis for comparing interconnection to other alternatives that have been studied. 1. Depending upon the size, transmission lines can transfer a virtually unlimited amount of power. This is one of the most important considerations of this alternative. A transmission line would not only meet CVEA’s current requirements but would provide for load growth into the indefinite future. Interconnection is the only available option that would provide for essentially immediate service to a new large load which would significantly enhance the a opportunity for economic development within the service area. 2. Depending upon the cost and the transfer capability of the transmission line, this alternative may be the most efficient use of capital. When compared to any other alternative studied to date, it is clear that a transmission line is the only project that will meet CVEA’s goal of providing for long-term load growth and an opportunity to reduce rates. 3. As reported earlier in this document, the integrated Railbelt system has summer available peak capacity of 1,176 mw and available winter peak capacity of 1,284 mw. Industry standards recommend 30-40% reserve capacity to serve load growth and for equipment failure. Even after adding an adjustment of 40% to projected Railbelt loads to provide reserve capacity for the above purposes, a surplus of 414 mw in the summer and 375 mw in the winter is available. The reason for this discussion is to point out that a significant surplus of power exists in the Railbelt to serve future load growth without major additional capital expenditures. This factor is very important to understand why Chugach has projected the price of wholesale power should decrease in real terms over the next 15 years (see Attachment C). Cost of Railbelt Power at O’Neill Substation Discussions with two of the Railbelt utilities has determined the cost of power at O’Neill Substation will depend on the quality of power purchased. Power quality ranges from a lower quality "nonfirm," or interruptible, to a high grade of "firm" that would only be interrupted by acts of God, major equipment failure, etc. Current price varies from 2.8¢/kwh for "immediately interruptible nonfirm" to 5¢/kwh for guaranteed "uninterruptible firm." CVEA is currently assessing how SGH can be used to provide the capacity necessary to allow purchasing some grade of nonfirm interruptible power. 16 1993 Legislative Action In cooperation with ARECA, the City of Valdez, the Greater Copper Valley and Valdez Chambers of Commerce, and others, CVEA launched a concerted lobbying effort in the 1993 session of the Alaska Legislature to obtain state assistance in funding the line. The request received an excellent reception by the majority of legislators, and in the final days of the session, legislation was passed approving a $35 million, 50-year, zero interest loan for design and construction of the project. The legislature also authorized the Alaska Industrial Development & Export Authority (AIDEA) to issue up to $25 million in bonds for any additional funding needed over the $35 million loan. The loan is subject to the acceptance, by the State of Alaska Department of Community & Regional Affairs (DCRA), of a complete feasibility study currently being prepared by R.W. Beck & Associates. The final Beck report is due to be published in November with the anticipation that it will be accepted by DCRA relatively soon thereafter. Until the study is complete, it is impossible to formulate the final economic impact, but CVEA is encouraged it will be favorable. Assuming the Beck study verifies PEI’s cost estimate, the 50-year, zero interest loan authorized by the legislature would reduce the debt service to $1,070,497 annually, or 3.2¢/kwh based on 1995’s projected load, a savings of 4.3¢/kwh. The most significant advantage provided by this project that would not be provided by any other project which has been studied is that the kwh cost would decline in the future as CVEA’s load grows. For example, if the load growth tracks the 1993 PRS, the kwh cost would decline to 1.9¢/kwh in ten years and to 1.5¢/kwh in 20 years. This advantage is a result of the relatively large 40 mw transfer capacity of the line. Debt service cost will become fixed in hard dollars in the year of construction. As CVEA’s loads grow in the future, two cost mitigating factors will result. First, as more kwh are transferred over the line, the cost per kwh will decrease because debt service will remain constant (the divisor gets larger, the dividend remains the same). Second, as inflation reduces the value of money, the real cost per kwh for debt service reduces proportionately. There are a number of other apparent advantages of the SGL over any other alternative that has been studied or offered to date. Some of these advantages are: Als The line has the capability to serve CVEA’s long-term load growth requirements. Ds It has a design life of at least 50 years and a high probability of lasting much longer, assuming proper maintenance. 35 It has an initial capital cost per unit of available capacity that is less than any other alternative studied. 4. It will provide benefits to the Railbelt system by expanding their marketing opportunity for surplus power. 17 35 It will provide CVEA with the ability to purchase lower priced power, thus allowing for stable rates and possible rate mitigation, making a crucial step forward in CVEA’s efforts to control rates. 6. Stable or reduced rates would enhance the local economies and support the economic development of the CVEA communities. It would entice new businesses to the areas and encourage existing businesses to expand. 7. CVEA’s diesel plants could be maintained in cold standby, thus reducing the consumption of fossil fuels, which would reduce exhaust emissions at the diesel plants. Reducing the burning of fossil fuels also reduces the tractor/trailer traffic on the highways and road system, resulting in reduced wear and tear on the roads. The Feasibility Study Being Prepared by R.W. Beck & Associates In late 1992, CVEA, in consultation with AEA, was informed that Alaska statutes require a detailed feasibility study for a major project to be eligible for state financial assistance. Historically, AEA had funded and conducted the required feasibility studies for major projects of statewide significance. AEA was in the middle of the FY93 budget year and unable to fund the study until the FY94 budget year, assuming the legislature would approve its budget request. In the course of discussing ways to expedite the study, it was agreed that CVEA would fund the study and AEA would request funds to reimburse CVEA in the FY94 budget year. On January 6, 1993, AEA and CVEA executed a Memorandum of Agreement that authorized AEA to conduct an independent study of the intertie project to meet the requirements of state law. CVEA agreed to fund the study in accordance with AEA’s pledge to include a request in its FY94 budget for reimbursement of the study cost. AEA circulated a Request for Proposal to several engineering firms and, based on their assessment of qualifications, awarded the feasibility study contract to Beck. The scope of the feasibility study being conducted by Beck is designed to provide a comprehensive look at the environmental, engineering, and economic factors of the proposed 138 kv line. While the conclusions drawn by the study should outline the viability of the line in more definitive terms than the original screening studies, some aspects of the design criteria adopted by Beck have lead to considerable discussion as to whether they represent the most cost-effective approach to the project. There has also been considerable discussion and some disagreement about the economic approach being applied. According to Richard Emerman, Senior Economist of AEA, the Beck study will take a global economic view of all of the alternatives. In at least some aspects, this method analyzes the "cost to society" which may or may not be consistent with actual market cost. 18 It is the understanding of the author that, in the global context, the study will not take into account any special considerations given one project and not the others, i.e., the 50-year, zero interest loan authorized by the legislature for the SGL. This approach is defended as the standard method of assessing the benefit to cost ratio of a project of this type. CVEA has accepted that argument but cautions it will necessitate looking beyond the economic findings of the Beck study to the plan of finance, which will consider all the factors, both common and project specific, to reach a clear, definitive, comparative value of each of the alternatives. In February 1993, AEA and Beck conducted public meetings in Sutton, Chickaloon, Glacier View, Glennallen, and Valdez to receive public input on the proposed line. CVEA staff and directors attended the meetings and answered questions posed by the attendees. Public response in Glennallen and Valdez was positive. Significant opposition to the project was encountered at the Sutton, Chickaloon, and to some extent, the Glacier View meetings. Dissenting comments were from people concerned that CVEA and AEA had not adequately studied alternative projects that could solve CVEA’s problem without building the line. AEA and CVEA attempted to review the significant work and study that has been done in the past to address the situation. The explanation was generally dismissed. by the public as insufficient evidence that, in fact, the matter had had a thorough enough evaluation to justify building the line. Several concerns were raised on the issue of Electric and Magnetic Fields (EMF). While there are no concrete answers to this issue, CVEA and AEA distributed information discussing how people are exposed daily to EMF. Because no one knows precisely what effect EMF has on health, there is no level that can be said to be either safe or unsafe. CVEA and AEA promote prudent avoidance of the source and keeping informed on the issue. Because EMF strength decreases dramatically with distance, moving a few feet away from the source will reduce the EMF exposure. The routing of the proposed line was altered to address local concerns of the proximity and visual impact of the line to private property. The majority of the dissenting comments were made by people who were concerned the line would be routed in view of the highway and/or over private property. AEA, Beck, and CVEA reviewed the public comment and determined that if the project was to receive any acceptance by people living in the Mat-Su Valley, it would require a significant rerouting from the route proposed. Two new routes were selected that would be out of view of the highway and would avoid trespassing private property to the maximum extent possible. Based on the property boundaries that have so far been identified, the reroute completely avoids private property. The rerouting is expected to increase the cost of the line, but in the spirit of being responsive to public concerns, CVEA believes it is justified. AEA and Beck, in concert with CVEA, conducted a second set of public meetings in June in the same communities to explain the rerouting proposal. Again, there were considerable additional comments relative to the availability of other alternatives and the routing of the line. To what extent any progress was made in mitigating public dissent in the Mat-Su Valley by the second set of meetings isn’t known, but it was made very clear that some residents in the Sutton- Chickaloon area are unalterably opposed to the project, regardless of what mitigating measures may be adopted. 19 CVEA continues to be dedicated to the proposition of being as responsive as possible to the public concerns being expressed. What Next A third round of public meetings will be held in late October or early November in the same communities as the first two sets were held. Possible modifications deemed necessary and achievable that result from recommendations of the last public meetings will be incorporated into the study, and a final document will be published in early December. As soon thereafter as possible, the funding for the line will be finalized and the process of beginning the center line location, right-of-way acquisition, and environmental study will proceed. SUMMARY What is the best course of action to provide additional generating capacity, replace the aging diesel units, reduce rates, and assure CVEA’s members of an adequate, reliable, and cost-competitive source of electricity to improve their standard of living and economic development opportunities for the benefit of future generations? Furthermore, how does CVEA acquire additional generation resources without adversely impacting rates that are already among the highest in the United States? CVEA has proposed, studied, and evaluated many alternatives over the past 20 years (see Attachment D). Of the alternatives studied, it appears that interconnection to the Railbelt grid provides the best opportunity for rate mitigation, long-term growth, and economic development for the region. 20 Attachment A Attachment B Attachment C Attachment D Attachment E INDEX OF ATTACHMENTS Projected Capacity and Demand of the Railbelt System, First Five Years CVEA Annual Generation by Month Chugach Electric Association 1992 Financial Forecast Estimated Electric Prices CVEA Schedule of Efforts Evaluated Letter from DNR, Natural Gas Deposits in the Copper Basin 21 W Juowyoeq iw [-ve 5 §. i 4 RAILBELT S ITEM 3A YSTEMS PROJECTED CAPACITY AND DEMAND FIRST FIVE YEARS CONCIL: ASCC 1993 1994 1995 1996. : 1997 Sum. [ | Win. | Sum. [| Win. [ Sum. [| win. [Sum. | [ Win. [ Sum. [| Win. DEMAND IN MW 01 ‘Internal Demand 535 658 544 649 550 661 559 671 566 681 02 Standby Demand (if not included in 01) 0 0 0 0 0 0 0 0 0 0 03 =Total Internal Demand (01+ 02) 535 658 544 649 550 661 §59 671 566 681 04 Direct Control Load Management 0 0 0 0 0 0 0 0 0 0 05 Interruptible Demand (Ft. Richardson) 4 4 5 5 5 5 5 5 5 5 06 Net Internal Demand (03-04-05) 531 654 539 644 545 656 554 666 561 676 CAPACITY, NET, IN MW 07 =Total Owned Capacity 1,176 1,284 1,176 1,284 1,176 1,284 1,169 1,276 1,169 1,276 08 Inoperable Capacity (if included in 07) 0 0 0 0 0 0 0 0 0 0 09 Net Operable Capacity (07-08) 1,176 1,284 1,176 1,284 1,176 1,284 1,169 1,276 1,169 1,276 10 Non-Utility Generators 0 0 0 0 0 0 0 0 0 0 1 Capacity Purchases (Total) 0 0 0 0 0 0 0 0 0 0 11a Full Responsibility Purchases 0 0 0 0 0 0 0 0 0 0 12 Capacily Sales (Total) 0 0 0 0 0 0 0 0 0 0 12a Full Responibility Sales 0 0 0 0 0 0 0 0 0 0 12b Adjustment to Purchases and Sales 0 0 0 0 0 0 0 0 0 0 13. Net Capacity Resources (09+10+11-12+12b) 1,176 1,284 1,176 1,284 1,176 1,284 1,169 1,276 1,169 1,276 14 Planned Outage 265 0 163 17 163 0 243 17 186 17 15 Net capacity Resources - Planned Outage (13 - 14) 911 1,284 1,013 1,267 1,013 1,284 926 1,259 983 1,259 @ FuSwyoez3V MEGAWATT HOURS (Thousands) a 0 COPPER VALLEY ELECTRIC ANNUAL GENERATION BY MONTIT —_—DIESEL —— GENERATION HYDRO a ee eee GENERATION a 1 I T T 1 T T T 1 J PF M A M J J A S 0 N TOTAL 1993 BUDGET + TYDRO-93) PROJECTION 2 Juowyoeziy CHUGACH ELECTRIC ASSOCIATION - 1992 FINANCIAL FORECAST Table 6 - Estimated Electric Prices Year 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Growth Rate, 1991 through 2015: Inflation 4.2% 5.3% 48% 48% 48% 5.0% 48% , 48% 48% * $.0% 48% 48% 48% 48% 48% 4.8% 48% 48% 48% 48% 48% 48% 48% 48% 48% MBP ELEC_PRC.XLS RETAIL Adjusted for Inflation 25% 0.1% -2.2% 55% 2.2% 1.1% 0.1% 0A% 1.0% 0.6% 1.7% 04% 1.2% 3.2% -3.0% 5.7% -3.7% -3.0% 3.3% 1.1% 0.7% -2.8% -3.2% Page 4 WHOLESALE Adjusted for Inflation 3/92 Revision, Margins on Net Interest COPPER VALLEY ELECTRIC SCHEDULE OF EFFORTS EVALUATED CAPACITY ENERGY USEFUL COST COST YRi$ INMW IN MWH UFE PER KW SPECIFIC PROJECTS ALLISON LAKE 31,000,000 1992 3 27,396 35 = 10,333 INFLATABLE DAM 1,500,000 1991 deciles 0s 36 882 SILVER LAKE 70,000,000 1992 10 48,000 24 ~=—- 7,000 NEW DIESEL PLANT 11,000,000 1990 7.2 37,296 15 1,528 COAL PLANT(HOBBS) 35,000,000 1993 11 48,000 20 = 3,182 SGL LINE 40,500,000 1992 40 ? 50 =: 1,013 NON PROJECT SPECIFIC EFFORTS ALYESKA PRT — ALYESKA INTERCONNECTION MERGER WITH GVEA LEAST COST PLAN SEPARATION OF CVEA BY DISTRICT NORTHEAST INTERTIE NATURAL GAS GENERATION RW BECK STUDY Attachment D e G STATE OF ALASKA WALTER J, HICKEL, GOVERNOR DEPT. OF NATURAL RESOURCES P.O. BOX 107034 ANCHORAGE, ALASKA 99510-7034 - DIVISION OF OIL AND GAS Richard Kornbrath, Geologist 907-762-2185 Mr. Clayton Hurless General Manager Copper Valicy Electric Association Fax: 822-5586 “Dear Mr. Hurless: This brief letter is to confirm our conversation this morning with regard to rumors of commercial hydrocarbon deposits in the Copper River basia. J will also take this opportunity to describe the basin geology somewhat, and I have attached some selected pages from reports that describe the petroicwn potential of the region. First, Ict me assure you that neither myself nor any of the rest of the Division geologic or engineering staff are aware of any commercial gas (or oil) finds in the Copper River Vailey. There has, in fact, been no recent drilling in the basin and it would be virtually impossible for a major discovery to have been made -- either in the past or recently ~ without the Division's knowledge. The most recently drilled wells in the basin are the Amoco AHTNA, INC. No. 1 and No. A-1, completed in 1980 to total depths of 7,928 feet and 5,677 fect, respectively. T show a record of eleven exploratory wells that have been drilled in the Copper River basin, most having — been drilled in the 1960's. The oldest rocks in the basin are represented by volcanic complexes that were penetrated in several wells, and outcrop in some of the surrounding mountains. Three distinetly different = Stratigraphic rock sequences overlie the “oascment rocks", including from eldest to youngest, Middle Jurassic thrcugh early Cretaceous sandstone, siltsone, shale and limestone; the late Cretaceous Matanuska Formation; and a Tertiary (approximately 60 million years old) scquence of marine and non-marine sandstoncs, shales, conglomerates and coal-bearing sandstone, The basin structure includes northeasterly rending, small amplitude folds, as well as major thrust faulls, and high-angle block faulting. Generaliy, the commercial hydrocarbon potential of this area is sccn as low to moderate, with the best chance for discoveries being small gas accumulations in the younger Tertiary stratigraphic sequence. Industry has shown little interest in the region in recent ycars, although some ficld efforts along the Attachment E eOLae metniain frent eutcrop belt have been pursued. A proposal for large-block licensing by the state is presently under consideraticn for this area. The new legislation would have to be passed by the Alaska State Legislature. This form of competitive licensing of large areas may, eventually, result in some renewed exploratory activity. I would hazard a guess that the "excitement" over a commercial gas find in the basin may te a result of some of the gas shows reported in two of the older exploratory wells and in at least one shallow water well. Shows of this type are not unusual, especially in areas of swampy or peat-rich terrain, or where the Stratigraphic waits are coal-bearing. The existence of permafrost may also contribute to the trapping of small, shallow gas pockets. Methane gas flows often are encountered in these settings. The William Buck well was Grilled as a water well and cncountered a low volume flow of natural gas at a shallow depth (less than 160 fect). This methane with minor bydrogen sulfide was thought to be a result of decaying vegetation beneath a permafrost trap, and is not considered significant as related to commercial gas production. Also, the Mobil Salmonberry Lake Unit No. 1 in Sec. 24, T6N, R6W flowed salt water and some methane gas at a depth of about 2,443 fect. The flow was controlled using heavier drilling muds. The Pan American Moose Creek Unit No. ] in Sco, 29, TAN, RSW also encountered a pressured water zone with some gas from fractured bentonitic (volcanic-rich) shale at about 5,430 feet to 5,663 feet. Again, I should emphasize that these types of shows are not an indication of commercial quantities of gas. If I can be of any further assistance in this matter, I can be reached al 762-2185. Sincerely, Richard Kornbrath ce: Mr. Robert Wilkinson enc: various copied pages from geologic reports Attachment £ 2 of 2 EVES Generation Capacity 5/5195 Generation Capacity and Requirements (MW) Jan-94 Feb-94 — Mar-94_—Apr-94_— May-94 — Jun-94_—Jul-94_—Aug-94 Sep-94 Oct-94 Nov-94__ Dec-94 __ Average | Valez Diesel 9.0 9.0 9.0 9.0 9.0 6.2 6.8 9.0 9.0 9.0 9.0 9.0 8.6 Glenn Diesel 5.3 53 5.3 5.3 5.3 5.3 5.3 3.1 3.1 5.3 5.3 5.3 4.9 Solomon 4.0 3.5 3.5 3.5 2.0 8.0 12.0 12.0 12.0 5.0 5.0 4.2 6.2 Total Available 18.3 17.8 17.8 17.8 16.3 19.5 24.1 24.1 24.1 19.3 19.3 18.5 19.7 Total Required 11.4 11.7 11.1 9.7 10.3 10.5 10.8 11.0 10.9 11.2 12.0 12.3 11.1 Surplus (Deficit) 6.9 6.1 6.7 8.1 6.0 9.0 13.3 13.1 13.2 8.1 7.3 6.2 8.7 ener: ilable and Requir H Jan-94 Feb-94 — Mar-94 — Apr-94 May-94 —_ Jun-94 Jul-94 Aug-94 — Sep-94 Oct-94 Nov-94__Dec-94 Total Hours in Month 744 672 744 720 744 720 744 744 720 744 720 744 8,760 Valez Diesel 6,696 6,048 6,696 6,480 6,696 4,464 5,059 6,696 6,480 6,696 6,480 6,696} 75,190 Glenn Diesel 3,943 3,562 3,943 3,816 3,943 3,816 3,943 2,306 2,232 3,943 3,816 3,943} 43,216 Solomon 2,976 pm hy} 2,604 2,520 1,488 5,760 8,928 8,928 8,640 3,720 3,600 3,125 54,531 Total Available 14,359 12,634 13,987 13,536 12,871 14,760 18,674 18,674 18,072 15,103 14,616 14,508} 181,795 Utilization Factor (70%) 10,051 8,844 9,791 9,475 9,010 10,332 13,072 13,072 12,650 10,572 10,231 10,156} 127,257 Total Generation 6,552 5,683 6,131 4,469 5,760 5,411 6,013 6,252 5,953 6,356 6,568 6,855 73,001 Surplus (Deficit) | 3,500 3,161 3,660 4,006 3,250 4,921 7,059 6,820 6,698 4,216 3,663 3,301 54,255 file=valez server\engr\excel\planning\prs95\GEN_REQ.XLS Attacnment U i V. INTEGRATION ANALYSIS STONE AND WEBSTER - FINAL REPORT Least Cost Planning Demonstrative Study September 1991 V.5.3.4 Financial Analysis The results of the financial analysis are summarized in the following table and included in Exhibits V-10 for the low case and V-11 for the high load growth scenario. The total revenue requirements for each of the load forecasts and objective function cases are reported for first year, 1998, and 2003, last year of the study period, along with the annual change. Similar results are reported for the total system average rate. Table V-8 Summary of Financial Analysis Low, Medium and High Load Growth TIER = 2.0 Total Revenue Requirements ($) Low Forecast (Exh. V-10) 7,510,293 9,252,476 11,024,717 =: 13,571,427 Medium Forecast (Exh. V-6) 8,490,152. 11,831,702 + 16,232,933 24,889,164 High Forecast (Exh. V-11) 9,261,670 14,889,865 23,726,172 41,330,108 Average System Rate (¢/kWh) Load Forecast Case 19921998 20032009 Change (%) Low Forecast (Exh. V-10) 18.35 23.66 29.32 37.66 4.32 Medium Forecast (Exh. V-6) 16.76 20.55 25.06 33.01 4.06 High Forecast (Exh. V-11) 16.06 19.62 24.66 33.54 4.43 Examining the PWRR cases the overall revenue requirements for the year 2009 could range between $17.134 million for the low load forecast to $41.330 million for the high load forecast. Various levels of load growth can occur depending on the area’s economy. Thus, this analysis demonstrates the possible changes in the overall rate increases CVEA customers may expect.. The final figures for the average system rates range from a low of 37.66¢/kWh in 2009 for the low case to 33.01¢/kWh for the medium case. This represents a 14-percent range or a 4.65¢/kWh difference, for the average system rate. Thus, the overall rate increases are very comparable, as the annual increases vary from 4.32 percent to 4.43. This result shows that the changes in costs are linear to the changes in customer sales, and do not have significant impact on the results. ee Stone & Webster Management Consultants, Inc. September 1991 y-19 Vv. INTEGRATION ANALYSIS V.6 Summary The overall results of the supply-side, integration and the sensitivity analysis cases are summarized in Table V-9. The levelized average system rates are compared as are the total PWRR costs of each scenario studied. This table depicts several different paths that CVEA can follow to meet the power demand of the future. Each of the cases represented in the following table represent a slightly different set of alternatives to add, in addition to those consistently selected. CVEA can decide to go with only the supply side options, or they may wish to also implement the DSM programs recommended in this report. The conclusions section of this report will provide recommendations for an implementation plan. Table Y-9 Comparison of Study Costs CASE DESCRIPTION Medium Forecast PWRR Objective Function - (1.681) (5.086) Average System Rate Objective Function 66.510 (1.660) 117.853 (3.963) Low Forecast PWRR Objective Function 39.244 N/A 52.990 N/A High Forecast PWRR Objective Function 102.622 N/A 210.229 N/A Petro Star Refinery Case** 81.132 N/A 136.132 N/A Levelized Average Svstem Rate (¢/kWh) 20-Year Difference Optimized Case 12.4676 - Medium Forecast PWRR Objective Function 12.4444 (0.0232) Average System Rate Objective Function 12.4222 (0.0454) Low Forecast PWRR Objective Function 11.9372 (0.5304) High Forecast PWRR Objective Function 13.2438 Petro Star Refinery Case** 12.1460 (0.3216) *Supply-side only case. **Medium forecast, PWRR objective function a Stone & Webster Management Consultants, Inc. September 1991 V-20 ey Vv. INTEGRATION ANALYSIS Figure V-5 graphically represents the annual revenue requirements and system rate in ¢/kWh for each of the results analyzed for all three load forecasts. The levelized average system rates shown above illustrate that the DSM programs can lower overall system rates. For example, the integration results show that a savings of 0.0454¢/kWh would occur if the DSM programs were implemented. There is only a slight difference between all of the cases. However, both of the integration expansion plans with DSM programs result in lower costs than these plans without any DSM programs. i Stone & Webster Management Consultants, Inc. September 1991 V-21 Attachment VU COPPER VALLEY ELECTRIC ASSOCIATION, INC. P.O. BOX 45 GLENNALLEN, ALASKA 99588-0045 Glennallen (907) 822-3211 Valdez (907) 835-4301 Telefax # (907) 822-5586 February 18, 1994 COMPARATIVE INFORMATION SUTTON-GLENNALLEN INTERTIE TO ALLISON LAKE PROJECT COMMENTS BY: fe Se GENERAL MANAGER PREFACE: Certain interest groups who oppose the construction of the Sutton to Glennallen intertie line seem to have decided the Allison Lake Project should be the preferred alternative future power supply of Copper Valley Electric Association (CVEA). They have apparently based their opinion on the comparative Net Present Values that are presented in Table 1-2 on page 1-15 of the Executive Summary of the Sutton to Glennallen Intertie draft feasibility study recently released by the Division of Energy, Department of Community & Regional Affairs (DE-DCRA). Their rush to make a selection that would eliminate the need to build the intertie needs to be put in it's proper perspective for those who are interested in the factual aspects of the debate over the need for and economic justification of constructing a 138KV transmission line to connect the CVEA system to the Railbelt Utilities System (RUS). CVEA's Board of Directors and Staff have been actively involved for a number of years— in searching for an alternative power supply to replace the aging and costly diesel generation presently being used to supplement the power available from the State owned Solomon Gulch Hydro (SGH) plant. In October of 1993 CVEA compiled and published a booklet titled "History and Status of Power Generation Resources", that reviews the different power supply options that have been studied in the past. The Allison Lake project was one of the projects studied and rejected because it did not meet a single criteria that had been established for a future power supply resource. If the reader chooses to reject the above fact, another significant consideration must be taken into account. A major unavoidable cost of the Allison Lake project has been omitted from the feasibility economic analysis. The omitted cost is attributable to the one- half of the energy production that is credited to the Allison Lake project that would be produced by the Solomon Gulch turbines and would bear a current cost of 6.4 cents kWh. Adding this charge to the annual operating cost of Allison Lake changes the cumulative Net Present Value of Allison Lake in the medium-low load case to$77,399,000, an increase of $11,000,000 from the draft feasibility study and $10,000,000 more than the SERVING MEMBER-OWNERS IN THE COPPER RIVER BASIN AND VALDEZ intertie If both of the above arguments are rejected, and it is-accepted the draft feasibility study is correct by not assigning a cost to the Allison Lake Project for power produced at Solomon Gulch, there is still not a compelling case to build Allison Lake in lieu of the intertie. In the high and medium high load cases, the intertie is clearly the least cost alternative. In the medium low load case which seems to have captured the imagination of the interties opponents, Allison Lake is only marginally less expensive; $1.2 million over the 50 year period, than the intertie. For a utility such as CVEA to select the Allison Lake alternative instead of the intertie based on the small difference in the NPV over the 50 year period would be an inexcusable, short sighted mistake considering that Allison Lake would add only 3 MW of capacity, at a cost of $11 million per MW and approximately 27,000 MWH of energy to CVEA's power supply. To plan to the most conservative load growth estimate would completely abort CVEA's original goal of identifying and building a power supply resource that would provide the greatest degree of flexibility in meeting the uncertainty of the future without having to resort back to a short term emergency planning spectrum that inevitably leads to high cost solutions. CVEA'S FUTURE POWER SUPPLY SELECTION CRITERIA In mid 1992 CVEA developed a list of required characteristics for the assessment of future power supply alternatives. The following are the four most important criteria or characteristics that were developed to serve as a planning guide in the effort to identify the best future power supply option. 1. The project should be able to efficiently provide generation adequate to supplement the output of the SGH and totally displace the diesel generation. 2. It should have the ability to serve the total system load in the event of an emergency shut down of the Solomon Gulch plant. 3. Priority would be given to a project that could serve CVEA's projected long term load growth and thereby alleviate the need for periodic construction of new generation. 4. Projects would be evaluated on their potential ability to provide for rate reduction and/or stabilization for CVEA's member owners. SUTTON-GLENNALLEN INTERTIE VS ALLISON LAKE PROJECT The following information is presented on a point by point basis to provide the reader with a discusssion of the characteristics of both proposed projects and should dispel the notion that Allison Lake is really a viable project to achieve the goals CVEA has established for the selection of a future power supply option. 41. PROJECTS ABILITY TO PROVIDE ADEQUATE GENERATION TO DISPLACE DIESELS R. W. Beck has estimated that in the medium-low load case, CVEA's total supplemental energy requirements will approximate 37,000 MWH in 1998 and will increase to 59,000 MWH in 2017. This does not consider any substantial load growth of the Petro Star Refinery load or any of the more speculative projects such as the U. S. Governments High Active Auroral Research Project (HAARP). As stated above Allison Lake is estimated to produce approximately 27,000 MWH of energy annually and would add a total of 3 MW of capacity to CVEA’s generation capability. The existing diesel plants would have to be maintained to supplement output of Solomon Gulch and Allison Lake beginning in the first year of operation. The Intertie could deliver 15-18 MW of capacity and approximately 100,000 MWH of energy at 65% Load Factor (LF) without the addition of any voltage support equipment (Static Var System, SVS). With the addition of an adequate sized SVS the intertie would deliver 40 MW of capacity and approximately 225,000 MWH of energy annually. The intertie would provide for retirement of the diesels into an emergency standby status. 2. PROVIDE ABILITY TO SERVE ENTIRE SYSTEM IN THE EVENT OF AN EMERGENCY SOLOMON GULCH SHUTDOWN. Allison Lake would not be operable if the Solomon Gulch project was forced into an emergency shutdown because both the primary and secondary generation from Allison Lake would be dependent on the Solomon Gulch electrical facilities being operable. The Intertie is totally independent of Solomon Gulch with the exception of minimal voltage support which could be supplied by CVEA's 2.8 MW turbine that is immediately available in the event of an emergency. In the medium low load case the intertie could serve CVEA's total system requirement through 2017 without additional SVS. In the medium high load case it could serve the total system requirements, with the addtion of the 2.8 MW turbine, through the same period without SVS support. If loads should grow in accordance with the high load case the addition of SVS would be required but that eventuality would not effect the economic viability of the intertie because of the added revenue that would be available from the additional sales and a load of the magnitude that required the addition of a SVS would likely be required to make a substantial contribution to the cost of SVS prior to becoming connected to CVEA's system. 3. CAPABILITY TO SERVE LONG TERM LOAD GROWTH WITHOUT PERIODIC CONSTRUCTION OF NEW GENERATION In the medium low load case the draft study estimates that CVEA will require 39,100 MWH of supplemental energy in the year 2000 when Allison Lake would come on line. In the medium high load case the requirement increases to 47,600 MWH. Allison Lake would have a total combined generating capability of 27,000 MWH which would mean a shortfall of 12,400 MWH in the medium low load case and a 20,600 MWH in the medium high load case in it's first year of operation. In contrast to Allison Lake, the Intertie could be brought on line in 1998 and would serve CVEA's expected supplemental requirements, in all load growth cases, well beyond the 50 year study period. The bottom line to this point is clear. The Intertie is an essentially permanent fix to CVEA's future power supply requirements. Allison Lake is not even a bandaid because it would require a disproportionately high investment in a project that would not meet CVEA's supplemental requirements in it's first year of operation and would seriouly impune CVEA's ability to finance another major project. 4 PROJECTS ABILITY TO REDUCE OR AT A MINIMUM STABLIZE CVEA'S RETAIL RATES. Allison Lake would cause CVEA's already extremely high rates to increase. It does not provide for the diesels to be retired into emergency standby status. If the aging diesel plants are required to be maintained into the future, it is a given the cost will increase substantially. Allison Lake would not provide for a second power source for the Copper Basin District in the event of a failure of the existing Valdez to Glennallen transmission line which would require the Glennallen diesel plant to be maintained in hot standby during the avalanche period when the transmission line in vulnerable to failure. Based on early discussions with potential power suppliers in the Railbelt, CVEA believes it will be able to reduce rates to its consumers with the advent of the intertie. The magnitude of the decrease is still somewhat nebulous and wiitremain so until a final power supply agreement is reached. It is not unreasonable to estimate that a meaningfull reduction can be achieved. In addition to the expected favorable impact on rates, the intertie will provide a completely independent power source for CVEA's system. In the event of an emergency shutdown of the Solomon Gulch Hydro the intertie could provide for the total system requirements for a number of years into the future. In the event of transmission line failure between Valdez and Glennallen, it would provide a power source for the Copper Basin District. Solomon Gulch would provide for the Valdez Districts requirement initially and in the event of an extended outage could be supplemented with the Valdez diesel plant to keep the entire system operational until the line could be repaired. SUMMARY Based on any rational planning basis, there is no reason the Allison Lake project would be constructed instead of the Intertie. It would be absurd to entertain the idea of investing $30 plus million in a 3 MW project that wouldn't meet the utilities supplemental requirements in it's first year of operation as compared to investing $46 million in a 40 MW project that would provide for CVEA's supplemental or full system requirements into the forseeable future. Allison Lake would not fullfill a single criteria established by CVEA for consideration of a future power supply option. ~ The Intertie Project would fullfill every criteria and surpass some of the criteria. The evidence is verifiable and conclusive. There is no reason for an extended debate of the relative merits of the two projects because even a casual analysis will clearly identify the Intertie as the right decision for Copper Valley Electric Association's member owners. Attachment E a Bt ig it August 18, 1994 Mr. Robert A. Wilkinson Manager, Administration and Finance Copper Valley Electric Association P.O. Box 45 Glennallen, Alaska 99588 Dear Robert: Subject: Revised Economic Analysis of Sutton - Glennallen Intertie Transmittal of Detailed Results In our last telephone conversation late last month I indicated that 1 would forward the detailed output for the revised economic analysis. With vacation and other pressing _ matters now out of the way, here at last are the tables for your files. In the enclosed package, you will find an eight page report for each of the nine cases prepared for the revised analysis. The cases are as follows: Medium-High Load Forecast, Low Fuel Escalation e All Diesel e Intertie e Allison Lake e Silver Lake - Option A e Valdez Coal Facility e Allison Lake without payment for Solomon Gulch Energy Low Load Forecast, Low Fuel Cost Escalation e All Diesel e Intertie e Allison Lake Please refer to my letter dated July 20, 1994 for a description of the methodology and assumptions used in the revised economic analysis. It should be noted that for the Allison Lake Case, the Solomon Gulch energy charge is included in the line labeled “Allison Lake Project - Annual O&M Costs”. The repayment of the State loan for the Intertie is included in the line labeled “Intertie Cost - Annual Carrying Charge”. 2101 Fourth Avenue, Suite 600 Seattle, WA 98121-2375 Phone (206) 441-7500 Fax (206) 441-4964 Mr. Robert A. Wilkinson August 18, 1994 Page 2 Once again, thanks for the opportunity to have assisted you and CVEA in its further evaluation of the Intertie. If you have any questions or comments concerning this analysis or we can be of further assistance please call me at 206-727-4418. Sincerely, R.W. BECK = —__ John L. Heberling Executive Engineer JLH: c WS-3945-AA1-AX All Diesel Case Med-Fi Load; Low Fucl Xeplace Ex. Diesel at OF Valdez Peak Demand Slennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertic Other New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacily Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus / (Deficit) Glennallen Peak Demand Reserves Total Capacity Requirements Local Resources Surplus / (Deficit) 19-Jul-94 sina Copper Valley Electric Association - Sutton/Glennallen Intertie Load and Resource Capacity Balance (KW) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 20003 2004 2005 8,793 9,234 10,131 10,560 10,837 10,958 11,079 11,202) 11,328 11,436 11,529 11,619 11,707 3,890 4,052. 4,206 4,366 4,397 4,427 «4,458 4490 4,522 4,541 4,560 4,579 _ 4,599 12,682 13,286 14,337 14,927 15,234 15,385 15,537 15,692 15,850 15,976 16,089 16,198 16,306 0 0 0 0 0 0 0; 0 0 0 0 0 0 0 0 0 0 0 0 0 { 0 0 0 0 0 0 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 0 0 0 0) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2,150. 4,300 4,300 6,450 6,450 6,50 6,450 6,450 6,450 0 0 0 2,150 2,150 2,150 4,300 4,300 4,300 4,300 4,300 4,300 4,300 9,750 9,750 9,750 9,750 4,050 7,00 7,100 4,600) 4,600 4,600 4,600 4,600 4,600 6800 6,800 6,800 6800 6,800 6800 4300 43004300 430043004300 4300 21,550 21,550 21,550 23,700 24,150 25,350 25,000 24,650 24,650 24,650 24,650 24,650 24,650 8,793 9,234 10,131 10,560 10,837 10,958 11,079 11,202) 11,328 11,436 11,529 11,619 11,707 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,150 2,150 2,150 2,150 2,150 2,150 11,293 11,734 12,631 13,060 13,337 13,458 13,579 13,352 13,478 13,586 __ 13,679 13,769 13,857 14,750 14,750 14,750 14,750 15,200 16,400 16,400 16,050 16,050 16,050 16,050 16,050 16,050 3457 3,016 2,119 1,690 —-1,863-2,942 2,821 2,698 2,572 2,464 2,371 2,281 2,193 3,890 4,052 4,206 4,366 4,397 = 4,427 4,458 4,490 4,522 4,541 4,560 4,579 4,599 2500 2,500 2,500 2,500 2,500 = 2,500 2,500 2,500 2,500 2,500 2,5(1X) 2,500 2,500 6390 6,552 6,706 6,866 6,897 6,927 6,958 6,990 7,022 7,041 7,060 7,079 7,099 6,800 6,800. 6,800 8,950 8950 8,950. 8,600. 8,600 8,600. 8,600. 8,600) 8,600 8,600 410 248 94 2,084 2,053 2,023 1,642 1,610 1,578 1,559 1,540 1521 1,501 R.W. Beck Result:Page * All Diesel Case Copper Valley Electric Association - Suttoh/Glennallen Intertie Med-Hi Load; Low Fuel Load and Resource Capacity Balance (KW) Replace Ex. Diesel at OF 2006 2007, 2008 ~——- 2009 2010 = 2011 2012 2013 2014 2015 2016 = 2017 2018 Valdez Peak Demand 11,796 11,885 11,975 12,066 12,158 12,252, 12,347) 12,443 12,539 12,635 12,732 12,830 12,929 Glennallen Peak Demand 4,618 4,638 4,658 4,678 4,699 4,719 4,740 4,761 —_4,782__«4,803___4,824 4,845 4,866 Total CVEA Demand 16,414 16,523 16,633 16,744 16,857 16,971 17,087 -17,204-17,321 17,438 «17,556 17,676 17,796 Firm Capacity Conservation Valdez 0 0 0 0 0 0 0 0 0 0 0 0 0 Conservation Glennallen 0 0 0 0 0 0 0 0 0 0° 0 0 0 Solomon Gulch j 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 Intertie 0 0 0 0 0 0 0 0 0 0 0 0 0 Other 0 0 0 0 0 0 0 0 0 0 0 an) 0 New Diesel Valdez . 6,450 6450 6,450 6,450 6,450 — 6,450 6A50 6,450 6,450 6,450 6,450 6,450 6,450 New Diesel Glennallen 4,300 4,300 4,300) 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 Existing, Diesel Valdez 4,600 4,600 4,600 4,600 4,600 4,600 4,600 4,600 4,600 4,600 4,600 4,600 4,600 Existing Diesel Glennallen 4300 4300 4,300 4300 4,300 4,300 4300 4,300 4,300 4,300 4,300 4,300 4,300 Total Firm Capacity 24,650 24,650 24,650 24,650 24,650 24,650 24,650 24,650 24,650 = 24,650 = 24,650 = 24,650 24,650 Valdez . Peak Demand 11,796 11,885 11,975 12,066 12,158 12,252 12,347 12,443 12,539 12,635 12,732 = 12,830 12,929 Reserves 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 Total Capacity Requirements 13,946 14,035 14,125 14,216 14,308 14,402 14,497 14,593 14,689 14,785 __ 14,882 __ 14,980 15,079 Local Resources 16,050 16,050 16,050 16,050 16,050 16,050 16,050 16,050 16,050. 16,050 16,050 16,050 16,050 Surplus /(Deficit) 2,104 2,015 1,925 1,834 1,742 1,648 13553) 1,457 1,361 1,265 1,168 1,070 971 Glennallen Peak Demand 4,618 4,638 4,658 4,678 4,699 4,719 4,740 4,761 4,782 4,803 4,824 4,845 4,866 Reserves 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 Total Capacity Requirements 7,118 7,138, 7,158 7,178 7,199 7,219 7,240 7,261 7,282 7,303 7,324 7,345 7,366 Local Resources 8,600 8,600 8,600 8,600 8,600__ 8,600. 8,600 8,600 8,600. 8,600 8,600 8,600 8,600 Surplus /(Deficit) 1482 1462 1,442) «1,422 1,401 1,381 1,360 = 1,339) 1,318 = 1,297, 1,276 1,255 1,234 19-Jul-94 R.W. Beck Result:Page All Diesel Case Med-Hi Load; Low Fuel Replace Ex. Diesel at OF Valdez Energy Requirements Generation for Valdez Load Conservation Valdez Solomon Gulch Intertie Other New Diesel Valdez Existing Diesel Valdez Deficit Glennallen Energy Requirements Generation for Glennallen Load Conservation Glennallen Solomon Gulch Intertie Other New Diesel Glennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertice Other New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 fee } i § | ; Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 51,328 54,622 61,149 64,357 66,324 67,034 67,750 68,77 69,216 69,850 = 70,400 70,928 71,449 0 0 0 0 0 0 0 0 0 0 0 0, 0 40,398 41,387 43,345 44,307 44,897 45,110 45,325 45,543 45,765 45,955 46,120 46,278 46,435 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 10,229 20,828 = 21,304 21,787 22,279 = 22,700 = 23,066 23,417 23,764 10,930 13,236 17,804 20,050 11,198 1,096 1,121 1,147__-1,173 1,195 1,214 17232teaet 2511 0 0 0 0 0 0 : 0 0 0 0 0 0 20,509 = 20,949 - 21,301 21,678 21,817 21,972 22,130 22,290 22,453 22,550 22,647 22,746 = 22,845 0 0 0 0 0 0 0 0 0 0 0 0 0 6,153 6,285 6390 — 6,504 6545 6,592 6,639 6,087 6,636 6,452 6,292, 6,138 5,986 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0) 0 0 0 0 0 0 0 0 0 0) 0 0 0 0 11,300 11,300) 11,300 15,491 15,603 15,817 16,098 16,356 16,608 16,858 14,356 14,664 14,910 3,874__3,972__4,080 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 71,837 75,571 82,450) 86,035 88,141 89,007) 89,880 90,767, 91,669 92,400 93,047 93,674 94,294 0 0 0 0 0 0 0 0 0 0 0 0 0 46,741 47,866 49,933 51,012 51,645 51,906 52,169 52,437 52,606 52,606 52,606 52,606 52,606 0 0 0 -0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 11,300 21,529 32,128 36,795 37,390 = 38,095 38,799 39,422, 40,025 40,622 25,286 27,900 32,715 23,924 15,170 5,176 ~~ 1,121 1,147 1,173 1,195 1,214 1,232 1,251 190 194 198 201 202 204 205 207 205 200 195 190 185 71,837 __75,571__#2,450_86,035__ 88,141 __89,007__ 89,880 90,767 __9 1,669 __ 92,400 93,047 93,674 94,294 0 0 0 0 0 0 0 0 0 0 0 0 - 0 R.W. Beck Result:Page | All Diesel Case Med-Fi Load; Low Fuel Replace Ex. Diesel at OF Valdez Energy Requirements Generation for Valdez Load Conservation Valdez Solomon Gulch Intertie Other New Diesel Valdez Existing Diesel Valdez Deficit Glennallen Energy Requirements Generation for Glennallen Load Conservation Glennallen Solomon Gulch Intertic Other New Diesel Clennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertic Other New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 I f ‘ ' { ! } | Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 71,970 72,495 73,025 73,562 74,105 74,657 75,215 75,782 76,346 76,914 77,486 78,063 78,643 0 0 0 0 0 0 0 0 0 0 0 0 0 46,591 46,748 46,908 47,068 47,232 47,397 47,565 47,735 47,904 48,074 48,246 48,419 48,593 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 24,110 24,459 24,812 25,169 25,530 25,897 26,268 26,645 27,020 27,398 27,778 28,162 28,548 1,269 1-2 5 7AM 2G W092 HLA-A SY SOO MU Se 1402 1,422, 1,442 1 A62___—*1,482 1503 0 0 0 0 0 0 0 0 0 0 0 0 0 22,945 23,046 23,147 23,250) 23,354 923,459 23,565 23,671 23,777 23,884 23,991 24,099 24,207 0 0 0 0 0 0 0 0 0 0 0 0 0 ee |||) See ||| Sea ||| gem |||) atc ||) ame 111] AT) aT 4,396 = 4,230 4,062 3,893 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0) 0 0 0 0 0 0 17,110 17,364 17,620) 17,879 18,141 18,406 18,674 18,946 19,216. 19, ABB 19,762 20,037 20,314 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 94,915 95,541 96,172 96,812 97,459 98,115 98,780 99,453 100,123 100,798 101,477 102,162 102,850 0 0 0 0 0 0 0 0 0 0 0 0 0 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 41,220 41,823 42,431 43,047 43,671 44,303 44,943 45,591 46,236 46,886 47,540 48,199 48,862 Pe a eB ees ||| Reee|||||| Rae Uae |||||||e eee ||| eee ||| ||| ||| | 1,503 180 176 171 166 161 156 151 146 141 136 131 126 120 94,915 95,541 96,172 96,812 97,459 98,115 98,780__99,453_ 100,123 100,798 _101,477_ 102,162 __ 102,850 0 0 0 0 0 0 0 0 0 0 0 0 sO) R.W. Beck Result:Pag: i ! F F af: ' j i } i i ( ‘ All Diesel Case Copper Valley Electric Association - Sutton/Glennallen Intertie Med-Hi Load; Low Fuel Economic Analysis (Constant 1993 Dollars 000) Replace Ex. Diesel at OH 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Diesel Costs Fuel $1,384 $1,535 $1,828 $1,947 $1,892 $1,852 $1,868 $1,907 $1,952 $1,997 $2,038 = $2,078 = $2,119 Variable O&M 786 867 1,017 861 695 494 416 423 431 439 446 453 460 Existing Diesel O&M Adjustment 0 0 0 0 0 0 291 291 291 291 291 291 291 Additional Building and Equipment 0 0 0 0 0 0 85 85 85 85 85 105 105 New Diesel Fixed O&M 0 0 0 26 26 26 26 26 26 26 26 26° 26 New Diesel Capital Costs 0 0 0 102 204 307 409 S11 S11 511 511 511 511 Total Diesel Costs $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $3,095 — $3,243 $3,296 $3,348 = $3,396 $3,464 = $3,511 Total Conservation Cost $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Intertie Cost Annual Carrying Charge $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Annual O&M Costs 0 0 0 0 0 0 0 0 0 0 0 0 0 Economy Energy 0 0 0 0 0 0 ol 0 0 0 0 0 0 Total Intertie Costs $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Other : Annual Carrying Charge $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Annual O&M Costs 0 0 0 0 0 0 0 0 0 0 0 0 0 Total Other Costs $0 $0 $0 $0 $0 $0 $0 ~ $0 $0 $0 $0 $0 $0 Total Cost of Power $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $3,095 $3,243 $3,296 $3,348 $3,396 $3,464 $3,511 Sale of Surplus Solomon Gulch Energy Surplus Energy 0 0 0 0 0 0 0 0 0 0 0 0 0 Revenues from Sale $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 District Heat Net Revenue(Coal Case) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Net Annual Cost of Power $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $3,095 $3,243 $3,296 $3,348 $3,396 $3,464 $3,511 Present Value in 1993 dollars (Discounted @4.5%) Cumulative (1993 - 2018) $49,529 (in thousands) 30 Year (2019 - 2048) with no additional growth 21,704 (in thousands) Total Net Present Value $71,233 (in thousands) 19-Jul-94 , R.W. Beck Result:Page All Diesel Case Med-Fli Load; Low Fuel Replace Ex. Diesel at OF Economic Analysis (Constant 1993 Dollars 000) Copper Valley Electric Association - Sutton/Glennallen Intertie 2006 2007 2008 2009 2010 2011 2012 2013 * 2014 2015 2016 2017 7 2018 Diesel Costs Fuel $2,159 $2,200 $2,242 $2,285 $2,328 $2,372 $2,417 $2,463 $2,509 $2,555 $2,603 $2,650 $2,699 Variable O&M 466 473 480 487 494 501 509 516 523 531 538 545 553 Existing Diesel O&M Adjustment 291 291 291 291 291 291 291 291 291 291 291 291 291 Additional Building and Equipment 105 105 105 105 105 105 105 105 105 105 105 105 105 New Diesel Fixed O&M 26 26 26 26 26 26 26 26 26 26 26 26 26 New Diesel Capital Costs Slit Sil 511 511 511 511 511 Sil 511 Stil 511 511 511 Total Diesel Costs $3,559 $3,607 $3,656 $3,705 $3,756 $3,807 $3,459 $3,912 $3,965 $4,019 $4,074 $4,129 $4,185 Total Conservation Cost $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Intertie Cost Annual Carrying Charge $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Annual O&M Costs ' 0 0 0 0 0 0 0 0 0 0 0 0 0 Economy Energy 0 0 0 0 0 0 0 0 0 0 0 0 0 Total Intertie Costs $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Other ; Annual Carrying Charge $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Annual O&M Costs 0 0 0 0 0 0 0 0 0 0 0 0 0 ‘Total Other Costs $0 $0 $0 $0 $0 $0 $0 - $0 $0 $0 $0 $0 $0 Total Cost of Power $3,559 = $3,607 $3,656 $3,705 = $3,756 $3,807 $3,859 — $3,912 $3,965 $4,019 = $4,074 - $4,129 $4,185 Sale of Surplus Solomon Gulch Energy 7 Surplus Energy 0 0 0 0 0 0 0 0 0 0 0 0 0 Revenues from Sale $0 $0) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 District Heat Net Revenue(Coal Case) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Net Annual Cost of Power $3,559 $3,607 $3,656 $3,705 $3,756 $3,807 $3,859 $3,912 $3,965 $4,019 $4,074 $4,129 $4,185 19-Jul-94 R.W. Beck Result:Page SUMPHONS ny Descriptions Ich Winter Gen 21,000 MWh) ===> in Options (eyes; eno) mservation ertie lison Lake ver Lake val Facility her vad Forecast (1LM,1.) ===> tel Prive (XELILL) ===> ydro Conditions (A,L) <=> Copper Valley Electric Association - Sutton/Glennallen Intertic All Diesel Case Med-Hi Load; Low Fuel Replace Ex. Diesel atOll Jngtude Yr Outi Location 0 1994 Hoth justment to Existing Diesel O&M Labor Costs r Alternative Usage Levels Standby ===> Kaseload «==> % Solar Turbine ===> trchase Price of Intertic Energy Leomomy 1 weap Economy 2 ===> lew Diesel Additions ===> Jet KW Plant sizes 1610 2150 3220 4300 Jote: To assist in determining he timing of new resources, use yacro <Alt>G. Then use macro Alt>D to return to normal mode. ‘Alto T then transfers the input section to he summary file Existing Units =me> 9-Jul-94 0 1999 Glennallen Nov 1, 1997 0 2000 Valdez. 9 2001 Valdez Option ===> b U 1998 Valdez 0 1997 Valdez m h ' a Savings Allison Lake Year ($1000) Intertie Silver Lake and Coal 3000 “560 560 145.5 1999 it 2050 2550 soo 2050 Station Us. 5% Valdez Gen All Wd Only No id 3.6% Select 500 204 JeyMen 1 Estimate of economy energy fel costs only 0 = Includes estimate of fixed related costs Valdez. Glenatlen Unit Year Cap(K New/Re — Unit Year Cap(K New/Kep 1 1997 2,150 6 1 1996 2,150 0 2 1998 2,150 6 2 1999 2,150 ¢ 3 2000 2,150 6 3 000 2,150 n 4 W000 2,150 4 w00 2,150 5 3000 2,150 5 3000 2,150 6 30002, 150 6 wo 2,150 7 3000 2,150 Z 002,150 8 3000 2,150 8 30002, 150 9 3000 2,150 2) w00 2,150 10 3000 2,150 w 3000 2,150 Valdez, Glenallen Unit Retire Year Unit Retire Year 1 3000 1 1989 2 3000 2 1989 3 3000 3 3000 4 1997 4 3000 5 2000 5 3000 6 1998 6 1999 7 a0) 7 000 R.W. Beck Result:Page 7 \SSUMPTIONS Sconomic and Financial Options General Inflation Sasa Real Discount Rate Real Interest Rate HW Construction Inflator CPI 1993/1992 Finance Cost Finance Life (in years) Diesel Hydro Intertie Proposed Coal Other Maximum Seasonal Plant Factor Existing Diesel, ===> New Diesel ===> Base price of Fuel 1993 ($/gal) #2 Fuel Oil Hago Transmission Losses Valdez - Glennallen Intertie¢ Hours Per Season) Winter = ===> Summer 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Interti 0.0% 4.5% 1.5% 4.2% 3.2% 0.0% 20 35 35 30 0 35% 60% Valdez 0.70 0.68 3.0% 9.7% 5832 2928 (Blue Chip Indicator) Glen 0.75 0.73 Intertic Availability Factor 0.98 (October - May) (une - September) R.W. Beck Result:Page Intertie Case Med-Hi Load; Low Fuel Maintain Ex. Diesel Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacily Conservation Valdez Conservation Glennallen Solomon Gulch Intertic Other New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacity Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus / (Deficit) Glennallen Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) 19-Jul-94 ee 7 eC =. q : ‘ a ; j 4% i F] \ | Yt ' I Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Capacity Balance (KW) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 8,793 9,234 10,131 10,560 10,837 10,958 11,079 11,202 11,328 11,436 11,529 11,619 11,707 3,890 4,052. 4,206 4,366 4,397 4,427 4,458 449) 4522 4,541 4,560 4,579 4,599 12,682 13,286 14,337. 14,927 15,234 15,385 = 15,537 15,692 15,850 15,976 16,089 16,198 — 16,306 0 0 0 0) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0) 0 0 0 0 0 0 5,000 5,000 5,000 5,000 5,000 5,000 6,500 6500 6,500 6,500 6,500 6500 6,500 --- --- --- --- --- --- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 6,800 6,800 6,800 6800 6800 6,800 6800 6,800 6,800 6,800 6,800 6,800, 6,800 21,550 21,550) 21,550) = 21,550) = 21,550) 21,550) 23,050 23,050 23,050 = 23,050 = 23,050 = 23,050 23,050 8,793 9,234 10,131 10,560 10,837, 10,958 11,079 11,202, 11,328 11,436 11,529 11,619 11,707 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,5(K) 2,500 2,500 2,500 2,500 2,500 11,293 11,734 12,631__13,060__13,337__ 13,458 13,579 13,702 __ 13,828 13,936 __ 14,029 14,119 14,207 14,750 14,750 14,750 14,750 14,750 14,750 16,250 16,250 16,250 16,250 16,250 16,250__16,250 3,457 3,016 2,119 1,690) 1,413 1,292 2,671 2,548 2,422 2,314 2,221 2,131 2,043 3,890 4,052 4,206 4,366 4,397 4,427 4,458 4,49) 4522 4541 4,560 4579 4,599 2,500 2,500 2,500 2500 2,500 2,500 0 0 0 0 0 0 6390 6,552 6,706 6,866 6,897 .—6,927__ AASB 4490 4,522 4,541 4,560 45794599 6800 6,800 6,800 6,800 6800 6,800 6,800 6800 6800 6,800 6,800 6,800 6,800 410 248 94 (66) (97) (127) 2,342 2,310 2,278 2,259 2,240 2,221 2,201 R.W. Beck Result:Page het ' pio b i ' i f i ' ; i ; ntertie Case Copper Valley Electric Association - Sutton/Glennallen Intertic Med-Hi Load; Low Fuel Load and Resource Capacity Balance (KW) Maintain Ex. Diesel 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Valdez Peak Demand 11,796 11,885 11,975 12,066 12,158 12,252 12,347) 12,443 12,539 12,635 12,732 12,830 12,929 Slennallen Peak Demand - 4618 4,638 4,658 4,678 4,699 4,719 4,740, _4,761 4,782. 4,803 4,824 _ 4,845 4,866 Total CVEA Demand 16,414 16,523 16,633 16,744 16,857 16,971 17,0871 17,204 17,321 17,438 17,556 17,676 17,796 Firm Capacity . Conservation Valdez 0 0 0 0 0 0 0 0 0 0 0 0 0 Conservation Glennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 6500 6,500 6,500 6500 6500 6,500 6500 6500 6,500 6500 6,500 6,500 6,500 Intertie 0 0 Oo °: O 0 0 0 0 0 0 0 0 0 Other 0 0 0 0 0 0 0 0 0 0 0 0 0 New Diesel Valdez 0 0 0 0 0 0 0 0 0 0 0 0 0 New Diesel Glennallen 0 0 0 0 0 0 0 0 * 0 0 0 0 0 Existing Diesel Valdez 9,750 9,750 9,750 9,750) 9,750 9,750 9,750) 9,750) 9,750) 9,750) 9,750 9,750 9,750 Existing Diesel Glennallen 68007 6800 6,800 6800 6,800 6,800 6800 G6 800680068006, 800___6,800 6,800, Total Firm Capacity 23,050 = 23,050 = 23,050 23,050 23,050 23,050 23,050 23,050 = 23,050 = 23,050 = 23,050 23,050 = 23,050 Valdez Peak Demand 11,796 11,885 11,975 12,066 12,158 12,252 12,347 12,443 12,539 12,635 12,732 12,830 ° 12,929 Reserves 2500 ° 2500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 — 2,500 2,500 Total Capacity Requirements 14,296 14,385 14,475 14,566 14,658 14,752 14,847 14,943 15,039 15,135__15,232__ 15,330 15,429 Local Resources 16,250 | 16,250 16,250 16,250 16,250 16,250 16,250 16,250 16,250 16,250 16,250 16,250 16,250 Surplus /(Deficit) 1,954 1,865 1,775 ~—-1,684 1592 1498 1,403 1,307. 1,211 1,115 1,018 920 821 Glennallen Peak Demand 4,618 4,638 4,658 4,678 4,699 4,719 4,740 4,761 4,782 4803 4,824 4,845 4,866 Reserves 0 0 0 0 0 0 0 0 0 0 0 0 0 Total Capacity Requirements 4618 4,638 4,658 4,678 4,699 4,719 4,740 4,761 4,782 4803 4,824 4,845 4,866 Local Resources 6800 6,800 6,800 6,800 6,800 6,800 6800 6,800 6,800 6,800 6,800 6,800. 6,800 Surplus /(Deficit) 2,182 2,162 2,142 2,122 2,101 2,081 2,060 = 2,039 2,018 «1,997 1,976 1,955 1,934 19-Jul-94 R.W. Beck Result:Page ntertie Case Acd-Hi Load; Low Fuel Aaintain Ex. Diesel Valdez Energy Requirements Sencration for Valdez Load Zonservation Valdez iolomon Gulch ntertie Dther New Diesel Valdez ixisting Diesel Valdez Deficit Slennallen Energy Requirements Seneration for Glennallen Load Zonservation Glennallen solomon Gulch ntertie Other New Diesel Glennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertie Other New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 1993 1994 1995 1996 1997 1998 1yy9 2000 2001 2002 2003 2004 2005 51,328 54,622 61,149 64,357 66,324 67,034 67,750 | 68,477 69,216 69,850) 70,400 70,928, 71,449 0 0 0 0 0 0 0 0 0 0 0 0 0 40,398 41,387 43,345 44,307 44,897. 45,110 45,325 45,543 45,765 45,955 46,120 46,278 46,435 0 0 0 0 0 Q 21,977. 22,475 22,982 23,417 23,794 24,157 24,514 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 10,930 13,236 17,804 20,050 _21,427__ 21,924 449 459 469 478 486 493 500 0 0 0 0 0 0 “0 0 0 0 0 0 0 20,509 20,949 21,301 21,678 21,817) 21,972 22,130 = 22,290) 22,453. 22,550 22,647 22,746 22,845 0 0 0 0 0 0 0| 0 0 0 0 0 0 6153 6,285 6,390 6504 6545 6,592 6,639 6,687 6,636 6,452 6,292 6,138 5,986 0 0 0 0 0 Q 15,181 15,291 15,500 15,776 16,029 16,276 16,521 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 14,356 14,664 14,910 15,175 15,272 15,381 310 312 316 322 327 332 337 0 0 0 0 0 0 0 0 0 0 0 0 0 71,837 75,571 82,450 86,035 88,141 89,007 89,880 ~—- 90,767 91,669 92,400 93,047 93,674 94,294 0 0 0 0 0 0 0 0 0 0 0 0 0 46,741 47,866 49,933 51,012 51,645 51,906 52,169 52,437 52,606 52,606 52,606 52,606 52,606 0 0 0 0 0 O 37,838 = 38,461 39,193 39,918 40,559 41,180 41,794 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 25,286 27,900 32,715 35,225 36,699 37,305 758 771 785 800 813 -825 837 190 194 198 201 202 204 885 902 916 924 930 937 943 71,837 75,571 82,450 86,035 __88,141__89,007__ 89, BK0___90,767__ 91,669 92,400 93,047 93,674 94,294 0 0 0 0 0 0 0 0 0 0 0 0 - 0 R.W. Beck Result:Page < vtertie Case 4ed-lli Load; Low Fuel faintain Ex. Diesel 'aldez Energy Requirements seneration for Valdez Load Zonservation Valdez olomon Gulch ntertie ther Jew Diesel Valdez txisting Diesel Valdez Deficit slennallen Energy Requirements 3eneration for Glennallen Load Zonservation Glennallen iolomon Gulch ntertie Dther New Diesel Glennallen ixisting Diesel Glennallen Deficit -VEA System Requirements Fotal Generation for CVEA System Conservation Copper Valley Solomon Gulch ntertic Sther New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit Q-1111-94 { } i k i { i ! } t : i : Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 71,970 72,95 73,025 73,562 74,105 74,657 75,215 75,782 76,346 76,914 77,486 78,063 = 78,643 0 0 0 0 0 0 0 0 0 0 0 0 0 46,591 46,748 46,908 47,068 47,232 47,397 47,565 47,735 47,904 48,074 48,246 48,419 48,593 24,872 25,232 25,595 25,963 26,336 26,714 27,098 27,487 27,873 28,263 28,656 29,051 29,449 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 508 515 522 530 537 545 553 561 569 577 585 593 601 0 0 0 0 0 0 0 0 0 0 0 0 0 22,945 23,046 23,147 23,250 23,354 23,459 23,565 23,671 23,777 23,884 23,991 24,099 24,207 0 0 0 0 0 0 0 0 0 0 0 0 0 5,435 5,682 5,526 5,372 5,213 5,053 4,890 4,725 4,561 4396 4,230 = 4,062 3,893 16,768 17,016 17,267 17,521 17,778 = 18,038 18,301 18,567 18,832: 19,098 19,367 19,636 19,908 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 342 347 352 358 363 368 373 379 384 390 395 401 406 0 0 0 0 0 0 0 0 0 0 0 0) 0 94,915 95,541 96,172 96,812 97,459 98,115 98,780 99,453) 100,123 100,798 101,477 102,162 102,850 0 0 0 0 0 0 0: 0 0 0 0 0. 0 52,606 52,606 52,606 52,606 52,606 52,606 52,606) 52,606 52,606 52,606 52,606 52,606 52,606 42,409 43,028 43,654 44,287 44,929 45,578 46,237 46,904 47,567 48,235 48,908 49,586 50,268 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 850 862 875 887 900 913 927 940) 953 967 980 994 1,007 950 956 963 969 976 982 989 996 1,003 1010 1,017_1,024 1,031 94,915 95,541 96,172 96,812 97,459 98,115 98,780 99,453 100,123 100,798 101,477 _ 102,162 __ 102,850. 0 0 0 0 0 0 0 0 0 0 0 0 > 0 R.W. Beck Result:Page + ntertie Case Med-Hi Load; Low Fuel Maintain Ex. Diesel Diesel Costs Suel Variable O&M ixisting, Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Costs Other Annual Carrying Charge Annual O&M Costs ‘Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 1993 19941995 199G YNZ YK YY 200) = 2001 = 2002, 2003, 20042005 $1,384 $1,535 $1,828 $2,051 $2,193 $2,256 $2 $43 pad $45 $16 $47 $48 786 = «8671017, 1,095. 1,141,159 24 24 24 25 25 26 26 0 0 0 0 0 0 (560) ~~ (560) (500) (560) (560) ~— (560) (560) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $2,169 $2,403 $2,845 $3,146 $3,334 $3,416 (49d) (HAY3) —(HA92) (GAO) (HABY) (ABB) ($486) $0 $0 $0 $0 $0 | $0 $0 $0 $0 $0 $0 $0 $0 a = a = a — $1,031 $1,012 $993 «$975 $958 $941 $925 = = = _ _ = 207 207 207 282 207, -«-207,—s-207 0 0 0 0 0 0 1512 15411575 1,608 1,638 1,668 1,698 $0 $0 $0 $0 $0 $0 $2,750 $2,760 $2,775 $2,865 $2,803 $2,816 $2,829 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0. $0 $0 $0 $0 $0 $0 $0 $2,169 $2,403 $2,845 $3,146 $3,334 $3,416 $2,255 $2,266 $2,283 $2,375 $2,314 $2,328 $2,343 0 0 0 0 0 0 437 169 0 0 0 0 0 $0 $0 $0 $0 $0 $0 ($16) ($6) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,169 $2,403 $2,845 $3,146 $3,334 $3,416 $2,240 $2,260 $2,283 $2,375 $2,314 $2,328 $2,343 Present Value in 1993 dollars (Discounted @4.5%) Cumulative (1993 - 2018) 30 Year (2019 - 2048) with no additional growth Total Net Present Value R.W. Beck $38,801 (in thousands) 13,878 (in thousands) $52,679 (in thousands) Result:Page ! ntertie Case Med-FHi Load; Low Fuel Maintain Ex. Diesel Jiesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertic Costs Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenuc(Coal Case) Net Annual Cost of Power 19-Jul-94 : Bs i k RF, Ok ' ‘ t } Mooay L { { { } I ' Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 $49 $49 $50 $51 $52 $53 $54 $55 $56 $57 $58 $59 $60 26 27 27 28 28 28 29 29 30 30 30 31 31 (560) (560) ~~ (560) (560) (S60) = (560) ~— (560) ~— (560) (560) (560) (560) (560) (560) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0) 0 0 0 0 0 0 0 0 0 0 0 ‘Om 0 0 0 ($485) ($484) ($482) (ABI) = (ABO) ($478) ($477) ($475) ($474) ($473) ($471) (ATO) ~— ($468) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $909 $894 $880 $865 $852 $839 $826 $814 $802 $790 $779 $768 $758 207 282 221 221 221 221 346 240 240 240) 240 269 269 727. 1,758 L788 Ls1y 1851 1,883 1915 1948 1981 2,015 2,049 2,083 2,117 $2,843 $2,933 $2,889 = $2,906 $2,923 $2,942 $3,087 $3,002 $3,023 $3,045 $3,068 $3,120 $3,144 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 - $0 $0 $0 $0 $0 $0 $2,358 $2,450 $2,406 $2,424 $2,444 $2,464 $2,610 $2,526 $2,549 $2,572 $2,597 $2,650 $2,676 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,358 = $2,450 $2,676 $2,406 $2424 $2,444 $2,464 $2,610 = $2,526 $2,549 $2,572 $2,597 $2,650 R.W. Beck Result:Page SSUMPTIONS in Descriptions ich Winter Gen 21,000 MWh ===> on Options (Leyes; 0=ne) onservation tertie Hison Lake Iver Lake ===> val Facility ==> ther ‘ ===> vad Forecast (1LM,L) =o=> uel Price (XU,1L,L) ===> lydro Conditions (A,L) ==> Copper Valley Electric Association - Sutton/Glennallen lntertie Intertie Case Meal-Hit al; Low Fuel Maintain Ex. Diesel djustment to Existing Diesel O&M Labor Costs ow Alternative Usage Levels Standby ===> WaseLoad > % Solar Turbine =ae> ‘urchase Price of Intertle Energy Economy 1 ===> Economy 2 <=> New Diesel Additions --—=> Net KW Plant sizes 1610 2150 3220 4300 Note: To assist In determining, the timing of new resources, use macro <Alt>G, Then use macro <Alt>D to return to normal mode. <Alt>T then transfers the input section to the summary file Existing Units ase> 19-Jul-94 YrOplin Laxation Inchute 0 1994 Both 1 1999 Glennallen Nov 1, 1997 0 2000 Valdez 0 2001 Vaklez Option ===> b 0 1998 Vaklez 0 1997 Valdez m h 1 a Savings Allison Lake Year ($)000) Intertie Silver Lake and Coal 1999 “560 560-1455 soo WI 2050 2550 500 2050 Station Us 5% Valdez Gen All Bid Only No Bld 3.6% Select 500 3000 JeyMen 1 Estimate of economy energy fuel costs only 0 Includes estimate of fixed related costs Valdez. Glenallen Unit Year Cap(K New/RKe Unit Year Cap (K New/Rep ' OW) 2,150 6 1 3000 2,150 n 2 3000 2,150 2 3000 2,150 & 3 3000 2,150 6 3 3000 2,150 n 4d 3000 2,150 n 4 3000 2,150 5 3000 2,150 n 5 3000 2,150 6 3000 2,150 6 3000 2,150 7 3000 2,150 i 3000 2,150 8 3000 2,150 8 300 2,150 9 3000 2,150 9 3000 2,150 10 3000 2,150 10 3000 2,150 Valdez Glenallen Unit: Retire Year Unit Ki Year 1 3000 1 1989 2 3000 2 1989 3 3000 3 3000 4 3000 4 3000 § 3000 5 3000 6 a0) 6 3000 7 3000 2 00 RW. Beck Result:Page' SSSUMPTIONS conomic and Financial Options General Inflation a) Real Discount Rate Real Interest Rate HW Construction Inflator CPI 1993/1992 Finance Cost Finance Life (in years) Diesel Hydro Intertic Proposed Coal Other Aaximum Seasonal Plant Factor Existing Diesel ===> New Diesel ===> 3ase price of Fucl 1993 ($/gal) #2 Fuel Oil ===> Hago ===> Transmission Losses Valdez - Glennallen ===> Intertie ===> Hours PerSeason Winter ===> Summer ===> 9-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Interti 0.0% { 45% — : 1.5% 4.2% 3.2% (Blue Chip Indicator) 0.0% 20 35 35 30 0 35% 60% Valdez Glen 0.70 0.75 0.68 0.73 Intertic Availability Factor 3.0% 0.98 9.7% 5832 (October - May) 2928 (June - September) R.W. Beck , Result:Page ¢ —— _- ~ Allison Lake Case Med-Hi Load; Low Fuel Replace Ex. Diesel at O11 Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertie Allison Lake New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacity Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) Glennallen Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) 19-Jul-94 f i k f Dy fh I i i ‘ t ' Copper Valley Electric Association - Sutton/Glennallen Intertie Load and Resource Capacity Balance (KW) 1993-1994 1995) 199G_-s«1997— YVR s1999 200 = 2001 = 2002, ks 2005 8,793 9,234 10,131 10,560 = 10,837 10,958 11,079 11,202) 11,328 11,436 11,529 11,619 11,707 3,890 4,052 4,206 4,366 4,397 4,427 4,458 4490 4,522 4,541 4,560 4,579 4,599 12,682 13,286 14,337 14,927 15,234 15,385 15,537 15,692 15,850 15,976 16,089 16,198 16,306 0 0 0 0 0 0 ( 0 0 0 0 0 0 0 0 0 0 0 0 ¢ 0 0 0 0 0 0 5,000 5,000 5,000 5,000 5,000 5,000 5,000 6,500 6,500 6,500 6,500 6,500 6,500 0 0 Oo. 0 0 0 0 0 0 0 0 0 0 0 0 0) 0 0) 0 0 3,067 3,067 3,067 3,067 3,067 3,067 0 0 0 0 2,150 4,300 4,300 4,300) 4,300 4300 4,300 4,300 4,300 0 0 0 2,150 2,150 = 2,150 4,300 4,300) 4,300 4,300 4,300 4,300 4300 9,750 9,750 9,750 9,750, B050 7,100, 7,100 7,100 7,100, 7,100 7,100 7,100 7,100 6800 6,800 6,800 6 KOO 680068004300 4300430074300 43004300 4300 21,550 21,550) 21,550 23,700) 24,150) = 25,350 25,000 29,567 29,567, 29,567 29,567 29,567 29,567 8,793 9,234 10,131 10560 10,837 10,958 11,079 11,202) 11,328 11,436 11,529 11,619 11,707 2,500 2,500 2,500 2,500 2,500 2,500 2,500 - 2,500 2,500 2,500 2,500 2,500 2,500 11,293 11,734__12,631__-13,060__13,337__13,458_ 13,579 13,702 13,828 13,936 14,029 14,119 14,207 14,750 14,750 14,750 14,750 15,200 16,400 16,400 20,967 20,967 20,967 20,967 20,967 20,967 3,457 3,016 2,119) 1,690 1,863 2,942 2,821 7,264 7,139 7,031 6,938 6,848 6,760 3,890 4,052 4,206 4,366 «4,397 4,427 4,458 94,490 4,522, 4541 4,560 4,579 4,599 2,500 2,500 2,500 2,500 2500 = 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 6390 6,552__—6,706_ 6,866 689769276958 6,990 7,022 7,041 7,060 7,079 7,099 6,800 6,800 6,800 8,950 8,950 8,950 8,600 8,600 8,600. 8,600 8,600 8,600 8,600 410 248 94 2,084 = 2,053, 2,023 1,642 1,610 1,578 1,559 1,540 1,521 1501 R.W. Beck Result:Page llison Lake Case led-Hi Load; Low Fuel uplace Ex, Diesel at OH aldez Peak Demand lennallen Peak Demand Total CVEA Demand irm Capacity onservation Valdez onservation Glennallen vlomon Gulch verlie Hison Lake lew Diesel Valdez lew Diesel Glennallen xisting Diesel Valdez xisting Diesel Glennallen Fotal Firm Capacity ‘aldez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) slennallen Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) Y-Jul-O4 ' 4 PRE { ' roepme wt wy op ? vi ‘ \ ok OS Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Capacity Balance (IW) 2006 = 2007, 20K 2009 201020 2012 20K ON 2015 201G 20. 2018 11,796 11,885 11,975 12,066 12,158 12,252, 12,347 12,443 12,539 12,635 12,732 12,830 12,929 4618 4,638 4,658 4,678 4,699 4,719 4,740 4,761__— 4,782 4,803 4,824 4,845 4,866 16,414 16,523 16,633 16,744 16,857 16,971 17,087 17,204 17,321 17,438 17,556 17,676 17,796 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6500 6500 6500 6500 6500 6,500 6500 6,500 6,500 6,500 6,500 6,500 6,500 0 0 0 0 0 0 0 0 0 0 0 0 0 3,067, 3,067 3,067 3,067, 3,067 3,067 3,067, 3,067 3,067 3,067 3,067 3,067 3,067 4300 4,300 4,300 4,300) 4300) 4,300 4300 4,300) 4,300 4,300 4,300 4,300 4,300 4300 4,300 4,300 4,300) 4300) 4,300 4,300) 4,300 4,300 4,300 4,300 4,300 4,300 7100 7,100 7,100 7,100 7,100 7,100 7,100 7,100 7,100 7,100 7,100 7,100 7,100 43004300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300___4,300 4300 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 11,796 11,885 11,975 12,066 12,158 12,252 12,347 { 12,443 12,539 12,635 12,732 12,830 = 12,929 2500 2,500 2,500 2500 2500 2,500 2,500! 2500 2,500 2,500 2,500 2,500 2,500 14,296 14,385 14,475 14,566 14,658 __14,752__-14,847_ 14,943 15,039__15,135__15,232__15,330_15,429 20,967 20,967 __ 20,967 __20,967__ 20,967 __ 20,967 __20,967__20,967__20,967__ 20,967 __20,967__20,967__ 20,967 6,671 6582 6492 6401 6309 6,215 6,120 6,024 5,928 5,832 5,734 — 5,636 5,538 4,618 4,638 4,658 4,678 4,699 4,719 4,740 4,761 4,782 4,803 4,824 4,845 4,866 2500 2,500 2,500 2500 2500 2,500 2500 2,500 2,500 2,500 2,500 2,500 2,500 7118 7,138 7,158 7,178 7,199 7,219 7,240 7,261,282 7,303 7,324 7,345 7,366 8.600 8,600 8,600 8,600 8,600 8,600 8,600 8,600 8,600 __8,600___—8,600__ 8,600 8,600 1482 1462 «1,442, 1422) 1401 1,381) 1360 1,339, 1,318 1,297, 1,276 1,255 1,234 R.W. Beck Result:Page z ison Lake Case fed-I-li Load; Low Fuel eplace Ex. Diesel at OF aldez Energy Requirements ‘eneration for Valdez Load ‘onservation Valdez olomon Gulch uerlic iHison Lake Jew Diesel Valdez xisting Diesel Valdez Deficit lennallen Energy Requirements seneration for Glennallen Load onservation Glennallen olomon Gulch ntertic \llison Lake Jew Diesel Glennallen ixisting Diesel Glennallen Deficit ZVEA System Requirements fotal Generation for CVEA System Zonservation Copper Valley solomon Gulch ntertie Allison Lake New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 i j i y Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005, 51,328 54,622 61,149 64,357 66,324 67,034 67,750 68,477, —-69,216 69,850 70,400 70,928 71,449 0 0 0 0 0 0 0 0 0 0 0 0 0 40,398 41,387 43,345 44,307 44,897 45,110 45,325 45,543 45,765 45,955 46,120 46,278 46,435 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Q = 22,934 23,451 23,895 24,280 24,650 25,015 0 0 0 Q 10,229 20,828 21,304 0 0 0 0 0 0 10,930 13,236 17,804 20,050 11,198 1,096 1,121 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 20,509 = 20,949 21,301 21,678 21,817 21,972 22,130 22,290 = 22,453 22,550 922,647 22,746 22,845 a” 0 0 0 0 0 0 0 0 0 0 0 0 6153 6285 6390 6504 6,545 6,592 6,639 6,687 6,636 6452 6,292 6,138 5,986 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3,668 3,166 2,735 2,362 2,003 1,650 0 0 0 11,300. 11,300 11,300 15,491 11,935 12,651 13,363 13,994 14,604 15,209 14,356 14,664 14,910 3,874 3,972 4,080 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 71,837 75,571 82,450 86,035 88,141 89,007 89,880 = 90,767, 91,669 92,400 93,047 93,674 94,294 0 0 0 0 0 0 0 0 0 0 0 0 0 46,741 47,866 49,933 51,012 51,645 51,906 52,169 52,437 52,606 52,606 52,606 52,606 52,606 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Q 26,715 26,715 26,715 26,715 26,715 26,715 0 0 0 11,300 21,529 32,128 36,795 11,935 12,651 13,363 13,994 14,604 15,209 25,286 27,900 32,715 23,924 15,170 5,176 = 1,121 0 0 0 0 0 0 190 194 198 201 202 204 205 320) 303 284 268 252 236 71,837 75,571 82,450 86,035__ 88,141 89,007 _ 89,880 90,767 __ 91,669 __92,400__93,047_ 93,674 94,294 0 0 0 0 0 0 0 0 0 0 0 0 - 0 R.W. Beck Resullt:Page 3 \llison Lake Case Aed-Hi Load; Low Fuel teplace Ex. Diesel at OF /aldez Energy Requirements Seneration for Valdez Load Conservation Valdez jo0lomon Gulch nterti¢ Allison Lake New Diesel Valdez ixisting Diesel Valdez Deficit slennallen Energy Requirements Seneration for Glennallen Load Conservation Glennallen Solomon Gulch ntertic Allison Lake New Diesel Glennallen Existing Diesel Clennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertic Allison Lake New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertie Load and Resource Energy Balance (MWh) ote. 2006 2007, 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 71,970 72,495 73,025 73,562 74,105 74,657 75,215 75,782 76,346 76,914 77,486 78,063 78,643 0 0 0 0 0 0 0 0 0 0 0 0 0 46,591 46,748 46,908 47,068 47,232 47,397 47,565 47,735 47,904 48,074 48,246 48,419 48,593 0 0 0 0 0 0 0 0 0 0 0 0 0 25,379 25,747 26,118 26,493 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 0 0 0 0 151 517 889 1,266 1,641 2,018 = 2,399 2,782 3,168 0 0 0 0 8 27 47 67 86 106 126 146 167 0 0 0 0 0 0 0 0 0 0 0 0 0 22,945 23,046 23,147) 23,250 23,354 23,459 23,565 23,671 23,777 23,884 23,991 24,099 24,207 0 0 0 0 0 0 0 0 0 0 0 0 0 5,835 5,682 5,528 5,372 5,213 5,053 4 BVO 4,725, 4,561 4,396 4,230 4,062 3,893 0 0 0 0 0 0 0 0 0 0 0 0. 0 1,296 940 580 215 0 0 0 0 0 0 0 0 0 15,814 16,424 17,040 17,663 18,141 18,406 18,674 18,946 19,216 19,488 19,762 20,037 20,314 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 94,915 95,541 96,172 96,812 97,459 98,115 98,780 99,453 100,123 100,798 101,477 102,162 102,850 0 0 0 0 0 0 0 0 0 0 0 0 0 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 0 0 0 0 0 0 0 0 0 0 0 0 0 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 15,814 16,424 17,040 17,663 18,291 18,923 19,563 20,212 20,857 21,506 22,161 22,819 23,483 0 0 0 0 8 27 47 67 86 106-126 146 167 221 205 189 173 161 156 151 146 141 136 131 126 120 94,915 95,541 96,172 96,812 97,459 98,115 98,780 _99,453_ 100,123 100,798 101,477_102,162__ 102,850 0 0 0 0 0 0 0 0 0 0 0 0 0 | R.W. Beck Result:Page \llison Lake Case Copper Valley Electric Association - Sutton/Glennallen Intertiec Acd-Hi Load; Low Fuel Economic Analysis (Constant 1993 Dollars 000) teplace Ex. Diesel at O11 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Diesel Costs Suel $1,384 $1,535 $1,828 $1,947 $1,892 $1,852 $1,868 $598 $636 $675 $710 $744 $779 Variable O&M 786 867 1,017 861 695 494 416 124 131 138 145 151 158 ixisting, Diesel O&M Adjustment 0 0 0 0 0 0 0 (146) (146) (146) (146) (146) (146) Additional Building and Equipment 0 0 0 0 0 0 0 0 0 0 0 0 0 New Diesel Fixed O&M 0 0 0 26 26 26 26 26 26 26 26 26 26 New Diesel Capital Costs 0 0 0 102 204 307 ~ 409 409 409 409 409 409 409 Total Diesel Costs $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $2,719 $1,010 $1,057 $1,103 $1,144 $1,185 = $1,225 Total Conservation Cost $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Intertie Cost Annual Carrying Charge $0 $0 $0 $0 $0 $0 $0 $0 $0 $0— $0 $0 $0 Annual O&M Costs 0 0 0 0 0 0 0 0 0 0 0 0 0 Economy Energy 0 0 0 0 0 0 0 0 0 0 0 0 0 Total Intertie Costs $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Allison Lake Annual Carrying Charge $0 $0 $0 $0 $0 $0 $0 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 Annual O&M Costs 0 0 0 0 0 0 0 1,039 1,024 L010 997 984 971 ‘Total Other Costs $0 $0 $0 $0 $0 $0 $0 $2,220 = $2,206 $2,192 $2,178 $2,165 $2,152 Total Cost of Power $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $2,719 $3,230 $3,262 $3,294 $3,322 $3,350 $3,378 Sale of Surplus Solomon Gulch Energy Surplus Energy 0 0 0 0 0 0 0 0 0 0 0 0 0 Revenues from Sale $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 District Heat Net Revenuc(Coal Case) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Net Annual Cost of Power $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $2,719 $3,230 $3,262 $3,294 $3,322 $3,350 $3,378 Present Value in 1993 dollars (Discounted @4.5%) Cumulative (1993 - 2018) $47,668 (in thousands) 30 Year (2019 - 2048) with no additional growth 19,909 (in thousands) Total Net Present Value ! $67,576 (in thousands) 19-Jul-94 R.W. Beck Result:Page Allison Lake Case Med-Fli Load; Low Fuel teplace Ex. Diesel at OF Diesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Costs Allison Lake Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenuc(Coal Case) Net Annual Cost of Power 19-Jul-94 y ’ Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 2006 = 2007, 2008 2009 2010 2011 2012 2013 2014 2015 = 2016 2017 201 $813 $848 $884 $921 $958 = $996 $1,035 $1,074 $1,114 $1,154 $1,195 $1,237 $1,279 164 170 177 183 190 197 204 211 219 226 234 241 248 (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) 0 0 0 0 0 0 0 0 0 0 0 0 0 26 26 26 26 26 26 26 26 26 26 26 26 26 409 409 409 409 409 409 409 409 409 409 409 A09 409 $1,266 $1,308 $1,350 $1,393 $1436 $1,482 $1,528 $1,575 $1,622 $1,669 $1,718 $1,767 $1,816 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,181 $1,181 $1,181 $1,181) $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 959 947 936 925 914 904 R94 885 875 866 858 849 841 $2,140 $2,128 $2,117 $2,106 $2,095 $2,085 $2,075 $2,066 $2,056 $2,047 $2,039 $2,030 $2,022 $3,406 $3,436 $3,467 $3,499 $3,532 $3,567 $3,603 $3,640 $3,678 $3,717 $3,756 $3,797 $3,839 | (0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $3,406 $3,436 $3,467 $3,499 $3,532 $3,567 $3,603 $3,640 $3,678 — $3,717 $3,797 $3,839 R.W. Beck $3,756 Result:Page SSSUMIHONS un Descriptions ulch Winter Gen 21,000 MWh ===> ‘un Options (l=yes; 0=no) fonservation > mertie > llison Lake > ilver Lake > “oal Facility onue> ‘ther el .oad Forecast (1LM,L) => fuel Price (XELILL) -aa> lydre Conditions (A,L) ==> wep bay ie -_ Copper Valley Electric Association - Sutton/Glennatlen latertic Allison Lake Case Med-IIi Load; Low Fuel Replace Ex. Diesel at Ol! Include Yr Onlin Location 1994 Both 2000 Valdez. 2001 Valdez Option ===> 0 1998 Valdez 0 1997 Valdez o-csce m h \djustment to Existing Diesel O&M Labor Costs or Alternative Usage Levels Standby ===> Vaseload > % Solar Turbine mae> ‘urchase rice of Ie Economy 1 Economy 2 New Diesel Additions ===> Net KW Plant sizes 1610 2150 3220 4300 Note: To assist in determining the timing of new resources, use macro <Alt>G. Then use macro <Alt>D to return to normal mode. <AltoT then transfers the input section to the summary file Existing Units ===> 19-Jul-94 1999 Glennallen Nov 1, 1997 Savings Allison Lake Year ($1000) Intertie Silver Lake and Coal 200) HSS 560 -145.5 3000 at 2050 2550 500 2050 Station Us 5% Valdez Gen All Bd Only No Bhd 3.6% Selet soo Sooo Jay=n 1 Estimate of economy energy fuel costs only Includes estimate of fixed related costs Valdez, Glenallen Unit Year Cap (K New/Re Unit Year Cap(K New/Rep 1 1997 2,150 © 1 1996 2,150 n 2 1998 2,150 6 2 1999 2,150 © 3 3000 2,150 6 3 3000 2,150 n 4 3000 2,150 4 wou 2,150 5 3000 2,150 5 3000 2,150 6 3000 2,150 6 3000 2,150 7 3000 2,150 Z 3000 2,150 8 3000 2,150 8 3000 2,150 9 3000 2,150 9 3000 2,150 10 3000 2,150 10 3000 2,150 Valdez Glenallen Unit: Retire Year Unit Retire Year 1 3000 1 19R9 2 3000 2 1989 3 3000 3 wod 4 1997 4 3000 5 3000 5 000 6 1998 6 1999 7 3000 7 3000 R.W. Beck Result:Page ASSUMPTIONS Economic and Financial Options ===> General Inflation Real Discount Rate Real Interest Rate HW Construction | CPI 1993/1992 Finance Cost nflator Finance Life (in years) Diesel Hydro Intertic Proposed Coal Other Maximum Seasonal Plant Factor Existing Diesel New Diesel Base price of Fuel 1993 ($/gal) #2 Fuel Oi Hago Transmission Losses Valdez - Glennallen Intertie Hours Per Season 19-4151-94 Winter Summer Copper Valley Electric Association - Sutton/Glennallen Interti 0.0% 4.5% 1.5% 4.2% 3.2% 0.0% 20 35 35 30 0 35% 60% Valdez 0.70 0.68 3.0% 9.7% 5832 2928 (Blue Chip Indicator) Glen 0.75 0.73 Intertic Availability Factor 0.98 (October - May) (une - September) R.W. Beck Result:Page Silver Lake Case - A Copper Valley Electric Association - Sutton/Glennallen Intertic Med-Hi Load; Low Fuel Load and Resource Capacity Balance (KW) Replace Ex Diesel at OFT 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Valdez Peak Demand 8,793 Q2aA TNO SIU OGU HERS 7a0 1 O,95s MTZ) E202 MT S26 ASG O29 mnt bOlo ml; cUs, Glennallen Peak Demand 3,890 4,052 4,206 4,366 4397 4,427 _ 4,458 4,490 4522 4,541 4,560 4579 4599 Total CVEA Demand 12,682 13,286 14,337 14,927 15,234 15,385 15,537 15,692 15,850 15,976 16,089 16,198 16,306 Firm Capacity Conservation Valdez 0 0 0 0 0 0 0 0 0 0 0 0 0 Conservation Glennallen 0 0 0) 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 6,500 6,500 6,500 6,500 6,500 Intertie 0 0 0 0 0 0 0 0 0) 0 0 0 0 Silver Lake 0 0 0 0 0 0 0 0 0 0 0 0 0 New Diesel Valdez 0 0 0) 0 2150042300) 4,300 4300 4,300 4300 4,300 4,300 4,300 New Diesel Glennallen 0 0 0 2,150 2S 2- 150) 4,300 4,300) 4,300 4,300 4,300 4,300 4,300 Existing Diesel Valdez 9,750 9,750 9,750 9,750 $,050 7A00 7,100 7,100 7,100 7,100 7,100 7,100 7A00 Existing Diesel Glennallen 6,800 6,800 6,800 6,800 6,800 6,800 4,300 4,300 4,300 4300 4,3(X) 4,300 4,300 Total Firm Capacily 2055502 S50012.9,55011/'235700) 1/245 150)) |/)25-350)1)|/' 25,000 25,000 = 26,500 26500 26,500 26,500 26,500 Valdez Peak Demand 8,793 9,234 = 10,131 10,560 10,837 10,958 11,079 UU 202 S26 uN ASG Wet 529 ul 11619 1,707, Reserves 2,500 2,500 2,500) 2,500 2,500 2,500 2500 2,500) 2,500 2,500 2,500 2,500 2,500 Total Capacity Requirements 11,293 __ 11,734 __12,63]_13,060__13,337__13,458__ 13,579 13,702 13,828 13,936 14,029 14,119 14,207 Local Resources 14,750 14,750 14,750 14,750 15,200 16,400 16,400 16,40) 17,900 17,900 17,900 17,900 17,900 Surplus /(Deficil) ere It temper image a a 2,698 4,072 3,964 3,871 3,781 3,693 Glennallen Peak Demand 3,890 4,052 4,206 4,366 4,397 4,427 4,458 4490 4522 4541 4,560 4579 4,599 Reserves 2,500 2,500 2,500 2,500 2,500: 2,500) 2,500 2,5(X) 2,500 2,500 2,500 2,500 2,500 Total Capacity Requirements 6390 6,552 6,706 6,866, 6,897 6,927 6,958 6,990 7,022 7,041 7,060 7,079 7,099 Local Resources 6800 6,800 6800__8,950__8,950 8,950 8,600 __—=8,600__—*8,600 8,600 8,600 8,600 8,600 Surplus / (Deficit) 410 248 94 2,084 2,053 2,023 1,642 1,610 Tre eee ss ee 1501 19-Jul-94 R.W. Beck Result:Page Silver Lake Case - A Med-Fi Load; Low Fuel Replace Ex Diesel at OFT Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertie Silver Lake New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacity Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) Glennallen Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficil) 19-Jul-94 E, f i j E Bea t ‘i ¥ F i i bey ! i ij ; Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Capacity Balance (KW) 2006 2007 2008 2009 2010 2001 2012 2013 2014 2015 2016 2017 2018 11,796 11,885 11,975 12,066 12,158 12,252 12,347 12,443. 12,539 12,635 12,732 12,830 12,929 4,618 4,638 4,658 4,678 4699 4,719 4,740 4,761 4,782 4,803 4,824 4,845 4,866 16,414 16523 16,633 16,744 16,857 16,971 17,087 17,204 17,321 17,438 17,556 17,676 —-17,796 0 0 0 0 0 0 0 0 0 0 0 0 0 0 10) 0 0 0 0 0 0 0 0 0 0 0 6500 6500 6500 6500 6500 6,500 6500 6500 6,500 6,500 6,500 6,500 6,500 0 70 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 4300 4300 = 4,300 4,300) 4,300 4,300) 4300) 4,300) 4,300) 4,300 4,300 4,300 4,300 4,300 4,300) 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 7,00 7,100 7,100 7,100 7,00 7,100 7,100 7,100 7,100 7,100 7,100 7,100 700 4300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300. 4300, 26,500 26,500 26,500 26,500 26,500 26,500 26500 26,500 26,500 26,500 26,500 26,500 26,500 11,796 11,885 11,975 12,066 12,158 12,252 12,347 12,443 12,539 12,635 12,732 12,830 12,929 2500 = =2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 14,296 14,385 14,475 14,566 14,658 14,752 14,847 14,943 15,039 15,135 __ 15,232 __15,330__—*15,429 17,900 17,900 17,900 17,900. 17,900 17,900 17,900 17,900 17,900 __ 17,900 __ 17,900 17,900 17,900 3,604 3,515 3,425 3,334 3,242 3,148 3,053 2,957 2,861 2,765 2,668 — 2,570 2,471 4,618 4,638 4,658 4,678 4,699 4,719 4,740 4,761 4,782 4,803 4,824 4,845 4,866 2500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 = 2,500 2,500 2,500 7ZA18 7,138 7,158 7,178 7,199 7,219 7,240) 7,261 7,282 7,303 7,324 7,345 7,366 8,600 8,600 8,600 8,600 8,600 8,600 8,600 8,600. $600. 8,600 8,600 8,600 8,600 1482 1462 1,442 1422 1,01 1,381 1,360 = 1,339) 1,318 = 1,297, 1,276 1,255 1,234 | R.W. Beck Result:Pagi silver Lake Case - A Acd-Hi Load; Low Fuel teplace Ex Diesel at OF /aldez Energy Requirements Seneration for Valdez Load Zonservation Valdez solomon Gulch ntertie silver Lake New Diesel Valdez ixisting Diesel Valdez ° Deficit Slennallen Energy Requirements Seneration for Glennallen Load Conservation Glennallen Solomon Gulch Intertic Silver Lake New Diesel Glennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertie Silver Lake New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 s i t i j Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 51,328 54,622 61,149 64,357 66,324 67,034 67,750 ~— 68,477 69,216 69,850) 70,400 70,928 71,449 0 0 0 0 0 0 0 0 0 0 0 0 0 40,398 41,387 43,345 44,307 44,897 45,110 45,325 = 45,543 45,765 45,955 46,120 46,278 46,435 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Q 23451 23,895 24,280 24,650 25,015 0 0 0 - Q 10,229 20,828 21,304 21,454 0 0 0 0 0 10,930 13,236 17,804 20,050 11,198 1,096 1,121 1,480 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 20,509 20,949 21,301 21,678 = 21,817) 21,972 22,130 = 22,290» 22,453. 22,550 22,647 22,746 =—-22,845 0 0 0 0 0 0 0 0 0 0 0 0 0 6,153 6,285 6390 6504 6,545 6,592 6,639 6,687 6,636 +6452 6,292 6,138 ~—— 5,986 0) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 15,817 16,098 16,356 16,608 16,858 0 0 Q 11,300 11,300) 11,300 15,491 15,603 0 0 0 0) 0 14356 14,664 14,910 3,874 3,972 4,080 (eG 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 71,837 75,571 82,450 86,035 88,141 89,007, 89,880 90,767 91,669 92,400 93,047 93,674 94,294 0 0 0 0 0 0 0 0 0 0 0 0 0 46,741 47,866 49,933 51,012 51,645 51,906 52,169 52,437 52,606 52,606 52,606 52,606 52,606 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 39,757 40491 41,142 41,771 42,394 0 0 0 11,300 21,529 32,128 36,795 37,057 0 0 0 0 0 25,286 27,900 32,715 23,924 15,170 5,176 1,121 1,480 0 0 0 0 0 190 194 198 201 202 204 205 207 694 697 700 703 707 71,837__75,571__ 82,450 __86,035__88,141__89,007__89,8KO__90,767__ 9 1,669 92400 9304793674 94,294 0 0 0. 0 0 0 0 0 0 0 0 0 - 0 R.W. Beck Result:Page. Per) i eee Pn ee Pee es 1 ¢ a aed fete Silver Lake Case - A Med-Hi Load; Low Fuel Replace Ex Diesel at OF Valdez Energy Requirements Generation for Valdez Load Conservation Valdez Solomon Gulch Intertic Silver Lake New Diesel Valdez Existing Diesel Valdez Deficit Glennallen Energy Requirements Generation for Glennallen Load Conservation Glennallen Solomon Gulch Intertic Silver Lake New Diesel Glennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertie Silver Lake New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 1 f i ‘ ' : I 1 ft " i a ; Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 71,970 72495 73,025 73,562 74,105 74,657 75,215 75,782 76,346 76,914 77,486 78,063 78,643 0 0 0 0 0 0 0 0 0 0 0 0 0 46,591 46,748 46,908 47,068 47,232 47,397 47,565 47,735 47,904 48,074 48,246 48,419 48,593 0 0 0 0 0 0 0 0 0 0 0 0 0 25,379 25,747 26,118 26,493 26,874 27,260 27,651 28,048 28,442 28,840 29,240 29,644 30,050 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 22,945 23,046 23,147 23,250 23,354 23,459 23,565 23,671 23,777 23,884 23,991 24,099 24,207 0 0 0 0 0 0 0 0 0 0 0 0 0 5,835 5,682 5,528 5,372 5,213 5,053 4,890 4,725 4,561 4,396 4,230 4,062 3,893 0 0 0 0 0 0 0 0 0 0 0 0 0 17,022 16,712 16,352 15,988 15,618 15,244 14,865 14,480 14,097 13,712 13,323 12,932 12,537 89 652 «1,268 «1891 2,522 3,162 3,809 44660 5,119 5,777, 6,439 7,106, 7,777 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 94,915 95,541 96,172 96,812 97,459 98,115 98,780 99,453. 100,123 100,798 101,477 102,162 102,850 0 0 0 0 0 0 0 0 0 0 0 0 0 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 — 52,606 0 0 0 0 0 0 0 0 0 0 0 0 0 42,927 42,975 42,975 42,975 42,975 42,975 42,975 42,975 42,975 42,975 42,975 42,975 = 42,975 89 652, 1,268 =—-1,891 2,522 3,162 3,809 44660 5,119 5,777 639 7,106 7,777 0 0 0 0 0 0 {0 0 0 0 0 0 0 707 693 677 661 644 628 611 594 577 560) 543. 526 508 94,915 95,541 96,172 96,812 97,459 98,115 __98,780__99,453_ 100,123 100,798 _101,477_102,162__ 102,850 0 0 0 0 0 0 0 0 0 0 0 0 - 0 R.W. Beck Result:Pag: Silver Lake Case - A Med-Fi Load; Low Fuel Replace Ex Diesel at OF Diesel Costs Fuel Variable O&M Existing, Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy ‘Total Intertie Costs Silver Lake Annual Carrying Charge Annual O&M Costs ‘Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power 19-Jul-94 i j i i Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 rai a) 1993 1994 19951996) 1997 99B TY 20K) tS 2002) 2003S 2004S 2005 $1,384 $1,535 $1,828 $1,947 $1,892) $1,852 $1868 $1,910 $0 $0 $0 $0 $0 786 867 1,017 861 695 494 416 430 0 0 0 0 () 0 0 0 0 0 0 0 0 (146) (146) (146) (146) (146) 0 0 0 0 0 0 0 0 i 0 0 0 0 0 0 0 26 26 26 26 26. 26 26 26 26 26 () 0 0 102 204 307 409 49 409 409 409 409 409 $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $2,719 $2,774 > $289 $289 $289 $289 $289 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0) 0 0 0 0 0 0 0) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 ho $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,985 $1,985 $1,985 $1,985 $1,985 0 0 0 0 0 0 0 0 593 593. 593 593 593. $0 $0 $0 $0 $0 $0 $0 $0 = $2,578 $2,578 $2,578 $2,578 $2,578 $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $2,719 $2,774 $2,867 $2,867 $2,867 $2,867 $2,867 0 0) 0) 0 0 0 0 0 0 0 0) 0) 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $2,719 $2,774 $2,867 $2,867 $2,867 $2,867 $2,867 Present Value in 1993 dollars (Discounted @4.5%) Cumulative (1993 - 2018) $43,217 (in thousands) 30 Year (2019 - 2048) with no additional growth 17,477 (in thousands) Total Net Present Value | $60,694 (in thousands) R.W. Beck Result:Pag¢ Silver Lake Case - A Med-FHi Load; Low Fuel Replace Ex Diesel at OF Diesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertic Costs Silver Lake Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power 19-Jul-94 k bE t t: bet aent ? t | } : Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 2006 2007, 2008 2009 2010 = 2011 2012 2013 2014 2015 2016 2017 2018 $5 $34 $66 $99 $132 $166 $201 $237 $273 $309 $346 $384 $422 1 7 13 20 26 33 39 46 53 60 67 7A 81 (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) (1G) (146) (146) 0 0 0 0 0 0 0 0 0 0 0 0 0 26 26 26 26 26 26 26 26 26 26 26 26 26 409 409 409 409 409 409 409 409 409 409 409 409 409 $294 $329 $368 $407 $447 $488 $530 $572 $615 $658 $702 $746 $791 $0 $0 $0 $0 $0 $0 A $0 » $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,985 $1,985 $1,985 $1,985 $1,985 $1,985 $1,985 $1,985 $1,985 $1,985 $1,985 $1,985 $1,985 593 593 593. 593 593 593 593, 593 593, 593. 593 593 593 $2,578 $2,578 $2,578 $2,578 2,578 $2,578 $2,578 $2,578 $2,578 $2,578 $2,578 $2,578 $2,578 $2,873 $2,908 $2,946 $2,986 $3,026 $3,066 $3,108 $3,151 $3,193 $3,236 $3,280 $3,325 $3,370 0 0 0 0 0 0 lo 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,873 $2,908 $2,946 $2,986 $3,026 $3,066 $3,108 $3,151 $3,193 $3,236 $3,280 $3,325 $3,370 R.W. Beck Result:Pag ASSUMPTIONS Run Descriptions =e=> Gulch Winter Gen 21,000 MWh ==> Run Options (l=yes; 0=no) Conservation Intertic Allison Lake Silver Lake Coal Facility Other Load Forecast (ILM,1) ===> Price (XILELL) ===> Fue Hydro Conditions (A,1) => Copper Valley Electric Association - Sutton/Glennallen Intertie Silver Lake Case- A Med- Hi Load; Low Buel Replace fix Diesel atOUl Adjustment to Existing Diesel O&M Labor Costs for Alternative Usage Levels Standby ===> Basel.oad ===> % Solar Turbine ===> Purchase Price of Intertie Energy Economy 1 ===> Economy 2 ===> New Diesel Additions ===> Net KW Plant sizes 1610 2150 3220 4300 Note: To assist in determining. the timing of new resources, use macro <Alt>G, Then use macro. <Alt>D to return to normal mode. <AloT then transfers the input section to the summary file Existing Units ==> 19-Jul-94 Include Yr Onlin Location 0 1994 oth 0 1999 Glennallen 0 2000 Valdez 1 2001 Valdez Option a 0 1998 Vaktez 0 1997 Vaklez m h | a Savings Allison Lake Year ($1000) Intertie Silver Lake and Coal 2001 “145.5 560 145.5 3000 291 2050 2550 500 2050 Station Us 5% Valdez Gen All Bit Only No Bld 3.6% Select 500 sooo deyfen 1 Estimate of economy energy fuel costs only 0 Inchides estimate of fixed related costs Vaklez Glenallen “Unit Year Cap(K New/Re Unit Year Cap(K New/Kep 1 1997 2,150 1 1996 = 2,150 n 2 1998 2,150 & 2 1999 2,150 6 3 30002, 150 3 wd 2,150 n 4 30002, 150 4 WOU 2,150 5 30002, 150 5 30002, 150 6 30002, 150 6 3000-2, 150 ZA 30000 2,150 7 002,150 8 a0 2,150 8 3000 2,150 9 3000 2,150 9 3000 2,150 10 3000 2,150 TY 3000 2,150 Valdez. Glenallen Unit Retire Year Unit Retire Year 1 3000 1 1989 2 3000 2 1989 3 3000 3 3000 4 1997 4 3000 5 3000 5 3000 6 1998 6 1999 7 sow) a 3000 R.W. Beck Result:Pag ASSUMPTIONS Copper Valley Electric Association - Sutton/Glennallen Interti Economic and Financial Options General Inflation se=> 0.0% Real Discount Rate ===> 4.5% Real Interest Rate ===> 1.5% HW Construction Inflator = ===> 4.2% CPI 1993/1992 ===> 3.2% (Blue Chip Indicator) Finance Cost ===> 0.0% Finance Life (in years) Diesel ===> 20 Hydro ===> : 35 Intertie ===> 35 Proposed Coal ===> 30 Other ===> 0 Maximum Seasonal Plant Factor Existing, Diesel ===> 35% New Diesel ma=> 60% Base price of Fuel 1993 ($/gal) Valdez — Glen #2 Fuel Oil ===> 0.70 0.75 Hago ===> 0.68 0.73 Transmission Losses Intertic Availability Factor Valdez - Glennallen =sm=> 3.0% 0.98 Intertie ===> 9.7% Hours Per Season) Winter = ===> 5832 (October - May) Summer ===> 2928 (June - September) 19-Jul-94 R.W. Beck Result:Page Valdez Coal Project Med-High Load; Low Fuel Replace Ex Diesel at OFL Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertie Coal Facility New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacity Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus / (Deficit) Glennallen Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) 19-Jul-94 1993 1994 Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Capacity Balance (KW) 1995, 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 8,793 9,234 10,131 10,560) 10,837 10,958 11,079 11,202) 11,328 =11,436 = 11,529 11,619 11,707 3890 4,052 4,206 4,366 4,397 4,427 4,458 4,490 4,522 4,541 4,560 4,579 4,599 12,682 13,286 14,337. 14,927 15,234 15,385 15,537 15,692 15,850 15,976 16,089 16,198 16,306 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5,000 5,000 5,000 5,000 5,000 6,500 6,500 650) 6500 6500 6,500 6500 6,500 0 0 Ons 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 22,000 22,000 = 22,000 = 22,000 = 22,000 = 22,000 = 22,000 = 22,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 9,750 9,750 9,750) 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 6800 6800 6,800 6,800 6,800 6,800__ 6,800 680) 6,800 6,800 6,800 6, 800-6, 800. 21,550 = 21,550 = 21,550 23,700 23,700 47,200 47,200 47,20) 47,200 47,200 47,200 47,200 47,200 8,793 9,234 10,131 10,560 10,837, 10,958 11,079 11,202 11,328 11,436 11,529 11,619 11,707 2,500 2,500 2,500 2,500 2,500 2,500 2,500 - 2,500 2,500 2,500 2,500 2,500 2,500 11,293 11,734 12,631 13,060 13,337 13,458 13,579 13,702 13,828 13,936 14,029 14,119 14,207 14,750 14,750 14,750 14,750 14,750 38,250 38,250 38,250 38,250 38,250 38,250 38,250 38,250 3,457 3,016 2,119 1,690 1,413 24,792 24,671 24,548 24,422 24,314 24,221 24,131 24,043 3,890 4,052 4,206 4,366 4,397 4,427 4,458 4,490 4,522 4,541 4,560 4,579 4,599 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 = 2,500 2,500 6390 _6,552__6,706 _ 6,866 6,897 66,9276, 958 6,990 7,022, 7,041 7,060 7,079 7,099 6,800 6,800 6,800 8,950 8,950 8,950 8,950) 8,950 8,950 8,950 8,950 8,950 8,950 410 248 94 2,084 2,053 2,023 1,992 1,960 1,928 1,909 1,890 1,871 1,851 R.W. Beck Result:Page : i ! ; ; Valdez Coal Project Copper Valley Electric Association - Sutton/Glennallen Intertic Med-Figh Load; Low Fuel Load and Resource Capacity Balance (KW) Replace Ex Diesel at OF 2006 = 2007, 2008 2009 2010-2011 2012, 2013) 2014 2015 = 20162017 2018 Valdez Peak Demand 11,796 11,885 11,975 12,066 12,158 12,252 12,347 12,443 12,539 12,635 12,732 12,830 12,929 Glennallen Peak Demand 4,618 4,638 4,658 4,678 4,699 4,719 4,740 4,761 4,782 4,803 4,824 _ 4,845 4,866 Total CVEA Demand 16,414 16,523 16,633 16,744 16,857 16,971 17,087 17,204 17,321 17,438 17,556 17,676 17,796 | Firm Capacity y Conservation Valdez 0 0 0 0 0 0 0 0 0 0 0 0 0 Conservation Glennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 6,500 6,500 6,500 6500 6500 — 6,500 6,500 6,500 6,500 6,500 6,500 6,500 6,500 Intertie 0 0 0 0 0 0 0 0 0 0 0 0 0 Coal Facility Ns 22,000 = 22,000 = 22,000 = 22,000 22,000 22,000 22,000 = 22,000 22,000 = 22,000 = 22,000 22,000 22,000 New Diesel Valdez 0 0 0 0 0 0 0 0 0 0 0 0) 0 New Diesel Glennallen 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 Existing Diesel Valdez 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 Existing Diesel Glennallen 6800 6,800 6,800 6,800 6,800 6,800 6800680068006, 800__6,800 6,800 __ 6,800 Total Firm Capacity 47,200 47,200 47,200 47,200) 47,200) 47,200 47,200) 47,200) 47,200) 47,200 47,200 47,200 47,200 Valdez Peak Demand 11,796 11,885 11,975 12,066 12,158 12,252 12,347 12,443 12,539 12,635 12,732 12,830 12,929 Reserves 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 Total Capacity Requirements 14,296 14,385 14,475 14,566 14,658 14,752 14,847 14,943 15,039 __-15,135__ 15,232 _ 15,330. 15,429 Local Resources 38,250 38,250 38,250 38,250 38,250 38,250 38,250 38,250 38,250 38,250 38,250 _ 38,250 38,250 Surplus /(Deficit) 23,954 23,865 23,775 23,684 23,592 23,498 23,403 23,307 23,211 23,115 23,018 22,920 22,821 Glennallen Peak Demand 4,618 4,638 4,658 4,678 4,699 4,719 4,740 4,761 4,782 4,803 4,824 4,845 4,866 Reserves 2,500 2,500 2,50K) 2,500 2,500 = 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 Total Capacity Requirements 718 7,138 7,158 7,178 7,199 7,219 7,240 7,261 7,282 7,3008_ 7,324 7,345, 7,366 Local Resources 8,950 $950. 8,950 8,950 8,950 8,950 8,950 8,950 8,950. 8950 8,950 8,950. 8,950 Surplus /(Deficit) 1,832 1,812) 1,792 1,772, 1,751 ‘1,731 1,710 1,689 1,668 1,647, 1,626 ~—- 1,605 1,584 19-Jul-94 R.W. Beck Resull:Pag Valdez Coal Project Med-High Load; Low Fuel Replace Ex Diesel at OH Valdez Energy Requirements Generation for Valdez Load Conservation Valdez Solomon Gulch Intertie Coal Facility New Diesel Valdez Existing Diesel Valdez Deficit Glennallen Energy Requirements Generation for Glennallen Load Conservation Glennallen Solomon Gulch Intertic Coal Facility New Diesel Glennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertie Coal Facility New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 1996 1993-1994 1995 1997 1998 ~—- 1999 2000 = 2001 = 2002) 2008S 20042005 51,328 54,622 61,149 64,357 66,324 67,034 67,750 = 68,477_—-69,216 69,850 70,400 70,928 71,449 0 0 0 0 0 0 0 0 0 0 0 0 0 40,398 41,387 43,345 44,307 44,897 45,110 45,325 45,543 45,765 45,955 46,120 46,278 46,435 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Q 21,924 22,425 = 22,934 23,451 23,895 9 24,280 924,650 = 25,015 0 0 0 0 0 0 0 0 0 0 0 0 0 10,930 13,236 17,804 20,050__ 21,427 0 0 0 0 0 0 0 0 0) 0 0 0 0 0 0 0 0 0 0 0 0 20,509 20,949 21,301 21,678 21,817) 21,972 22,130 22,290) 22,453 22,550 22,647 22,746 22,845 0) 0 0 0 0 0 0 0) 0 0 0 0 0 6153 6,285 6,390 6,504 6,545 6,592 6,639 6,087 6,636 6452 6,292 6,138 5,986 0 0 0 0 0 0 0 0 0 0 0 0 0) 0 0 0 0 0 15,381 15,491 15,603 15,817 16,098 16,356 16,608 16,858 0 0 0 11,300 11,300 0 0 0 0 0 0 0 0 14,356 14,664 ___ 14,910 3,874 3,972 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 71,837 75,571 82,450 86,035 88,141 89,007 89,880 90,767 91,669 92,400 93,047 93,674 94,294 0 0 0 0 0 0 0 0 0 0 0 0 0 46,741 47,866 49,933 51,012 51,645 51,906 52,169 52,437 52,606 52,606 52,606 52,606 52,606 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Q 37,780 38,395 39,019 39,757, 40,491 41,142 41,771 42,394 Oy 0 0 11,300 11,300 0 0 0 0 0 0 0 0 25,286 27,900 32,715 23,924 25,399 0 0 0 0 0 0 0 0 190) 194 198 201 202 680 684 689 694 697 700 703 707 71,837__75,571__ 82,450 _ 86,035 __88,141_ 89,007 _ 89,880 __90,767__91,669__92,400__93,047__93,674__ 94,294 0 0 0 0 0 0 0 0 0 0 0 0 - 0 R.W. Beck Result:Pag¢ 5 Ki j B { ; \ (eu Valdez Coal Project Copper Valley Electric Association - ee Intertic Med-High Load; Low Fuel Load and Resource Energy Balarice (MWh) Replace Ex Diesel at OF! ; 2006 2007 2008 2009 2010 2011 2012 2013 2014 201 2016 2017 2018 Valdez Energy Requirements 71,970 72,495 73,025 73,562 74,105 74,657 75,215 75,782 76,346 76,914 77,486 78,063 78,643 Generation for Valdez Load Conservation Valdez 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 46,591 46,748 46,908 47,068 47,232 47,397 47,565 47,735 47,904 48,074 48,246 48,419 48,593 Intertie 0 0 0 0 0 0 0 0 0 0 0 0 0 Coal Facility 25,379 25,747 26,118 26,493 26,874 27,260 27,651 28,048 28,442 28,840 29,240 29,644 30,050 New Diesel Valdez 0 0 0 0 “0 0 0 0° 0 0 0 0 0 Existing Diesel Valdez 0 0 0 0 0 0 0 0 0 0 0 0 0 Deficit : 0 0 Oi 0 0 0 0 0 0 0 0 0 0 Glennallen Energy Requirements 22,945 23,046 23,147 23,250 = 23,354 23,459 = 23,565 23,671 23,777 23,884 23,991 24,099 24,207 Generation for Glennallen Load Conservation Glennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 5,835 5,682 5,528 5,372 53213 9,053 4,890 4,725 4,561 4,396 4,230 4,062 3,893 Intertic 0 0 0 0 0 0 0 0 0 0 0 0 0 Coal Facility 17,110 = 17,364 17,620 17,879 18,141 18,406 18,674 18,946 19,216 19,488 19,762 20,037 20,314 New Diesel Glennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Existing Diesel Clennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Deficit 0 Q 0 0 0 0 0 0 0 0 - 0 0 0 CVEA System Requirements 94,915 95,541 96,172 96,812 97,459 98,115 98,780 99,453 100,123 100,798 101,477 102,162 102,850 Total Generation for CVEA System Conservation Copper Valley 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 52,606 52,606 52,606 52,606 52,606 52,606 52,406 52,606 52,606 52,606 52,606 52,606 52,606 Intertie 0 0 0 0 0 0 0 0 0 0 0 0 0 Coal Facility 43,019 43,647 44,282 44,925 45,576 46,235 46,903 47,579 48,253. 48,931 49,613. 50,301 50,993 New Diesel CVEA 0) 0 0 0 0 0) 0 0 0 0 0 0 0 Existing Diesel CVEA 0) 0 0 0) 0 0 0 0 0 0 0 0 0 Less Transmission Losses V-G 710 713 716 719 722 726 729 732 735 739 742 745 749 Total 94,915 95,541 96,172 96,812 97,459 98,115 98,780 99,453 100,123 100,798 101,477 _102,162__ 102,850 Deficit 0 0 0 0 0 0 0 0 0 0 0 0 : 0 19-Jul-94 R.W. Beck Result:Pag Valdez Coal Project Med-High Load; Low Fuel Replace Ex Diesel at OF Diesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertic Cost Annual Carrying Charge Annual O&M Costs Reonomy Energy ‘Votal Intertie Costs Coal Facility Annual Carrying Charge Annual O&M Costs ‘Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenuc(Coal Case) Net Annual Cost of Power 19-Jul-94 bv l 4 5 4 i Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 $1,384 $1,535 $1,828 $1,947 $2,088 $0 $0 $0 $0 $0 $0 $0 $0 786 867, 1,017 861 906 0 0 0 0 0 0 0 0 0 0 0 0 0 (291) (291) (291) (291) (291) (291) (291) (291) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 26 26 26 26 26 26 26 26 26 26 0 0 0 102 102 102 102 12 W2 102 102 102 102 $2,169 $2403 $2,845 $2,935 $3,122 ($163) ($163) ($163) ($163) ($163) ($163) ($163) ($163) $0 $0 $0 $0 $0 $2,169 $2,403 $2,845 $2,935 $3,122 Cumulative (1993 - 2018) $3,336 Present Value in 1993 dollars (Discounted @4.5%) 30 Year (2019 - 2048) with no additional growth Total Net Present Value R.W. Beck ($1,592) ($1,600) $3,359 $0 $0 $0 $0) $0) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 oh $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0) 0 0 0 0 0 0) 0 0 0 $0 $0) $0) $0 $0 $0 40 $0) $0 $0 $0 $0) $0 $0 $0 $0 $0 $0 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 0 0 0 0 03,578 3,608 3,639 3,675 3,711__—«3,743 3,774 __ 3,805 $0 $0 $0 $0 $0 $5,092 $5,122 $5,152 $5,188 $5,224 $5,256 $5,287 $5,318 $2,169 $2,403 $2,845 $2,935 $3,122 $4,929 $4,959 $4,989 $5,025 $5,061 $5,093 $5,124 $5,155 0 0 0 0 0 0 0 0 0 0 0 0 0 $ 86=—o0s—iHOtC“‘ |SSCKSCKSSCS $ 8©690—:—i«Hs—“(itéastiHCS ($1,608) ($1,615) ($1,623) ($1,631) ($1,639) ($1,646) $3,382 $3,410 $3,438 $3,462 $3,486 $3,509 $49,839 (in thousands) 19,879 (in thousands) $69,719 (in thousands) Result:Page Valdez Coal Project Med-High Load; Low Fuel Replace Ex Diesel at OH Diesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy ‘Total Intertie Costs Coal Facility ' Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 2006 = 2007-2008) 20092010 2011. ss2012,—Ss«a2013-——siNA~Ssa 2015s 20H, 20I_——s« 2018 $0 $0 $0 $0 go $0 $0 $0 $0 $0 $0 $0. $0 0 0 0 0 0 0 0 0 0 0 0 0 0 (291) (291) (291), (291), (291) (291) (291) (291), (291) (291), (291) (291),——(291) 0 0 0 0 0 0 0 0 0 0 0 0 0 26 26 26 26 26 26 26 26 26 26 6 26 26 102.102, 02, 0222 022 tt 102 ($163) ($163) (163) ($163) ($163) ($163) ($163) ($163) 163) ($163) ($163) ($163) ($163) $0 $0 $0 $0 $0 $0 qo $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 gO 40 q0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 $1,513 38363867 3,899 3,930 _3,963__3,996 _4,029__4,063__4,096__4,130_-4,164_—«4.199 4.234 $5,349 $5,380 $5,412 $5,444 $5,476 $5,509 $5,542 $5,576 $5,610 $5,643 $5,678 $5,712 $5,747 $5,186 $5,217 $5,249 $5,281 $5,313 $5,346 $5,379 $5,413 $5,447 $5,480 $5,515 $5,549 $5,584 0 0 0 0 0 0 b 0 0 0 0 0 0 $0 $0 $0 $0 $0 «$0 $0 $0 $0 $0 $0 $0 $0 ($1,654) ($1,662) ($1,670) ($1,678) ($1,686) ($1,694) ($1,702) ($1,710) ($1,718) ($1,726) ($1,734) ($1,743) ($1,751) $3,532 $3,555 $3,579 $3,603 $3,627 $3,652 $3,677 $3,703 $3,728 $3,754 $3,780 $3,806 R.W. Beck $3,833 ResultPage ' } i | 5 f F f ' } yr (Ta i rae F ? i : i ; , a m tore Pe pe pr pre pk ge pe pte pt ple TF ASSUMPTIONS Copper Valley Electric Association - Sutton/Glennallen Intertie Run Descriptions eee Valles Coal Project => Med- High Load; Law Fuel Gulch Winter Gen 21,000 MWh) ===> Replace ix Diesel atOll Run Options (l=yes; 0=no) Inchidy YrOnlin Location Conservation 0 1994 Both Intertie 0 1999 Glennallen Nov 1, 1997 Allison Lake 0 2000 Valdez Silver Lake 0 2001 Vaklez Option ===> b Coal Facility 1 1998 Valdez Other 0 1997 Vaklez Load Forecast (LM,L) ==> m h Q Fuel Price (XILILL) <=> 1 Hydro Conditions (A,1.) ===> a Adjustnent to Existing Diesel O&M Labor Costs for Alternative Usage Levels Savings Allison Lake Year ($4000) Intertie Silver Lake and Coal Standby ===> 1998 291-560-1455 Basel.oad > 3000, at 2050 2550 500 2050 Station Us % Solar Turbine ==> * §% Valdez Gen All Wd Only No Bld J.6% Select so JW) Purchase rice of Intertie Energy deyilen Economy t ==> 1 Estimate of economy cnergy fuel costs only Economy 2 ===> O Includes estimate of fixed related costs Valdez. Glenallen Unit Year Cap(K New/Re Unit Year Cap (K New/Rep New Diesel Additions e=n=> 1 3000 2,150 6 1 1996 2,150 n 2 3000 2,150 6 2 3000 2,150 6 Net KW Plant sizes 16 3 3000 2,150 ¢ 3 w00 2,150 n 2180 4 3000 2,150 n 4 3000 2,150 nw 5 3000 2,150 n 5 300 2,150 4300 6 3000 2,150 6 3u00 2,150 Note: To assist in determining 7 3000 2,150 a 30002, 150 the timing of new resources, use 8 3000-2150 8 3000——2,150 macro <Alt>G. Then use macro 9 3000 2,150 9 3000 2,150 <Alt>D to return to normal mode. 10 300002, 150 10 3000—2,150 <AltT then transfers the input section to the summary file Valdez Glenallen Unit Retire Year Unit Retire Year Existing Units s==> 1 300 1 1989 2 3000 2 1989 3 3000 3 3000 d 3000 4 3000 5 3000 5 3000 6 3000 6 3000 Z 3000 7 3000 19-Jul-94 R.W. Beck Result:Pay ASSUMPTIONS Copper Valley Electric Association - Sutton/Glennallen Interti Economie and Financial Options General Inflation 0.0% Real Discount Rate 4.5% Real Interest Rate 1.5% HW Construction Inflator 4.2% CPI 1993/1992 3.2% (Blue Chip Indicator) Finance Cost 0.0% Finance Life (in years) ; Diesel 20 Hydro 35 Intertie 35 Proposed Coal 30 Other 0 Maximum Seasonal Plant Factor Existing Diesel ===> 35% New Diesel s==> 60% Base price of Fuel 1993 ($/gal) Valdez Glen #2 Fucl Oil ===> 0.70 (0:75 Hago ===> 0.68 0.73 © Transmission Losses Intertie Availability Factor Valdez - Glennallen 3.0% 0.98 Intertie 9.7% Hours Per Season Winter Summer 5832 (October - May) 2928 (June - September) 19-Jul-94 , R.W. Beck Result:Pag: Allison Lake Case-No SG Cost Med-Hi Load; Low Fuel Replace Ex. Diesel at OH Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertic Allison Lake New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacity Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) Glennallen Peak Demand Reserves Total Capacity. Requirements Local Resources Surplus / (Deficit) 19-Jul-94 Role ye h Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Capacity Balance (KW) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 8,793 9,234 10,131 10,560 10,837 10,958 11,079 11,202,-11,328-11,436—-11,529 11,619 11,707 3,890 4,052 4,206 4,366 4,397 4,427 4,458 4490 4,522, 4,541 4,560 4,579 4,599 12,682 13,286 14,337 14,927. 15,234 15,385 15,537 15,692 15,850 15,976 16,089 16,198 16,306 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 oO. 0 0 0 0 0 0 0 0 ~ 0 5,000 5,000 5,000 5,000 5,000 5,000 5,000 6500 6500 6500 6,500 6500 6,500 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3,067, 3,067 3,067 3,067, = 3,067 = 3,067 0 0 0 0 2,150 4,300 4,300 4300 4,300 4,300 4,300 4,300 4,300 0 0 QO 2,150 2,150 2,150 4,300 4300 4300 4,300 4,300 4,300 4,300 9,750 9,750 9,750 9,750 8,050 7,100 7,100 7,100 7A00 7,100 7A00 7,00 7,100 6800 6,800 6,800 6,800 6,800 6, 8004300 4300 4,300 4,300 4,300 4,300 4,300 21,550 = 21,550) 21,550 23,700 24,150) 25,350 25,000 29,567 29,567 29,567 29,567 29,567 29,567 8,793 9,234 10,131 10,560 10,837 10,958 11,079 = 11,202 11,328 «11,436 «11,529 11,619 11,707 - 2500 2,500 2,500 2,500 2,500 2,500 2500 - 2,500 2,500 2,500 2,500 2500 2,500 “11,293 11,734 12,631__13,060__13,337__13,458 13,579 __13,702__ 13,828 13,936 __14,029 14,119 _14,207 14,750 14,750 14,750 14,750 15,200 16,400 16,400 20,967 20,967 20,967 20,967 20,967 20,967 3457 3,016) 2,119) 1,690) 1,863 2,942 2,821 7,264 7,139 = 7,031 6,938 6848 6,760 3,890 4,052 4,206 4,366 4,397 4,427 4,458 4490 4522 4541 4,560 4,579 4,599 2500 2500 2,500 2500 2500 2,500 2,500 2,500 2500 2,500 2,500 2,500 2,500 6390 52 6,706 6,866 6,897 6,927 __ 6,958 6,990 7,022 7,041 7,060 7,079 7,099 6,800 6,800 6,800 8,950 8,950 8,950 8,600 8.600 8,600 8,600 8,600 8,600 8,600 410 248 94 2,084 2,053 2,023 1,642 1,610 1578 1,559 1,540 1,521 1,501 R.W. Beck Result:Pag Allison Lake Case-No SG Cost Med-Fli Load; Low Fucl Replace Ex. Diesel at OF Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertie Allison Lake New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacity Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) Glennallen Peak Dem Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) and 10Tr1-94 t { k 5 t= F | ; t 1 i i Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Capacity Balance (KW) 2006 2007 2008 2009 2010 2011 2012 2013, 2014 2015 2016 2017 2018 11,796 11,885 11,975 12,066 12,158 12,252, 12,347, 12,443 12,539 12,635 12,732 12,830 12,929 4618 4,638 4,658 4,678 4,699 4,719 4,740 4,761 4,782 48034, B24 4, BAS 4,866 16,414 16,523 16,633 16,744 16,857 16,971 17,087 17,204 17,321 17,438 17,556 17,676 17,796 0 0 0 0 0 0 0 0 O° 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6500 6500 6,500 6500 6,500 6,500 6500 6,500 6,500 6,500 6,500 6,500 6,500 0 0 0 0 0 0 0 0 0 0 0 0 0 3,067, 3,067, 3,067, 3,067, 3,067, 3,067 3,067, 3,067 3,067, 3,067 3,067 3,067 3,067 4300 4300 4,300) 4300 4300 4,300) 4,300) 4,300) 4,300 4300) 4,300 4,300 4,300 4300 4300 4,300 4,300 4,300 4,300) 4,300) 4,300 4,300) 4,300) 4,300 4,300 4,300 7100 7,100 7,100 7,100 7,100 7,100 7100 7,100) 7,100) 7,100 7,100 7,100 7,100 4,300 4,300 4,300 4300 4,300 4,300 43000 4,300 4,300 4300 4,300 4,300 4,300, 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 29,567 11,796 11,885 11,975 12,066 12,158 12,252 12,347 12,443 12,539 12,635 12,732 12,830 12,929 2500 2,500 2,500) 2,500 2,500 2,500 2500 2,500 2,500 2,500 2,500 2,500 2,500 14,296 14385 14,475 14,566 14,658 14,752 14,847 14,943 15,039 15,135 15,232 15,330___ 15,429 20,967 20,967 __ 20,967 __20,967__20,967__20,967__ 20,967 __20,967__20,967__ 20,967 __20,967__20,967__ 20,967 6,671 6,582 6,492 6401 6309 6,215 6,120 6,024 5,928 5,832 5,734 5,636 5,538 4,618 4,638 4,658 4,678 4,699 4,719 4,740 4,761 4,782, 4,803. 4,824 4,845 4,866 2500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2500 2,500 2,500 2,500 7,118 7138_ 7,158 7,178 7199 7,219 7,240 7,261 7,282 7,303 7,324 7,345 7366 8,600 8,600 8,600 8,600 8,600 8,600 8,600 8,600 8,600. 8,600 8,600___ 8,600 8,600 1,482 1,462 1,442 122 1,401 1,381 1,360 1,339 1,318 1,297 1,276 1,255 1,234 R.W. Beck Result:Pag Allison Lake Case-No SG Cost Med-Hi Load; Low Fuel Replace Ex. Diesel at OF Valdez Energy Requirements Generation for Valdez Load Conservation Valdez Solomon Gulch Intertic Allison Lake New Diesel Valdez Existing Diesel Valdez Deficit Glennallen Energy Requirements Generation for Glennallen Load Conservation Glennallen Solomon Gulch Intertic Allison Lake New Diesel Glennallen Existing Diesel Glennallen Deficit : CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertie Allison Lake New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 h f ' i ‘ t f : fd i Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 51,328 54,622 61,149 64,357 66,324 67,034 re 68,477 69,216 69,850 70,40) 70,928 71,449 0 0 0 0 0 0 0 0 0 0 0 0 0 40,398 41,387 43,345 44,307 44,897 45,110) 45,325 45,543 45,765 45,955 46,120 46,278 46,435 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 QO 22,934 23,451 23,895 24,280 24,650 25,015 0 0 0 Q = 10,229 20,828 21,304 0 0 0 0 0 0 10,930 13,236 17,804 20,050 11,198 1,096 1,121 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 20,509 20,949 21,301 21,678 21,817 21,972 22,130 22,290 22,453 22,550 22,647 22,746 22,845 0 0 0 0 0 0 0 0 0 0 0 0 0 6153 6,285 6,390 = 6,504 6,545 6,592 6,639 6,687 6,636 6,452 6,292 6,138 5,986 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3,668 3,166 2,735 2,362 2,003 1,650 0 0 0 11,300) 11,300) 11,300 15,491 11,935 12,651 13,363 13,994 14,604 = 15,209 14,356 14,664 14,910 3,874 3,972 4,080 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 71,837 75,571 82,450 = 86,035 88,141 89,007 89,880 90,767, 91,669 92,400 93,047 93,674 94,294 0 0 0 0 0 0 0 0 0 0 0 0 0 46,741 47,866 49,933 51,012 51,645 51,906 52,169 52,437 52,606 52,606 52,606 52,606 52,606 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 = 26,715 26,715 26,715 26,715 26,715 26,715 0 0 0 11,300 21,529 32,128 36,795 11,935 12,651 13,363 13,994 14,604 ~ 15,209 25,286 27,900 32,715 23,924 15,170 5,176 1,121 0 0 0 0 0 0 190 194 198 201 202 204 205 320, 303, 284 268 252 236 71,837 75,571 __ 82,450 86,035__ 88,141 89,007 89,880 90,767 _ 9 1,669 __92,400__93,047_93,674_ 94,294 0 0 0 0 0 0 0 0 0 0 0 Oo -. O R.W. Beck Result:Pag Allison Lake Case-No SG Cost Med-Hi Load; Low Fucl Replace Ex. Diesel at OL Valdez Energy Requirements Generation for Valdez Load Conservation Valdez Solomon Gulch Intertie Allison Lake New Diesel Valdez Existing Diesel Valdez Deficit Glennallen Energy Requirements Generation for Glennallen Load Conservation Glennallen Solomon Gulch Intertie Allison Lake New Diesel Glennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertic Allison Lake New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 71,970 72,495 73,025 73,562 74,105 74,657 75,215 75,782 76,346 76,914 77,486 78,063 78,643 0 0 0 0 0 0 0 0 0 0 0 0 0 46,591 46,748 46,908 47,068 47,232 47,397 47,565 47,735 47,904 48,074 48,246 48,419 48,593 0 0 0 0 0 0 0 0 0 0 0 0 0 25,379 25,747 26,118 26,493 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 0 0 0 0 151 517 889 1,266 1,641 ZLB ine oo e: Zoe 3,168 0 0 0 0 8 27 47 67 86 106 126 146 167 0 0 0 0 0 0 0 0 0 0 0 0 0 22,945 23,046 23,147) -23,250 = 23,354 = 23,459 ne 23,671 23,777 23,884 23,991 24,099 24,207 0 0 0 0 0 0 0 0 0 0 0 0 0 SD HSOMMMOOSZ MO SZ EMO SALMO LOMO OS Mla ee 4: 7,2) Ta cOO 4,396 4,230 4,062 3,893 0 0 0 0 0 0 0 0 0 0 0 0 0 1,296 940 580 215 0 0 0 0 0 0° 0 0 0 15,814 16,424 17,040 17,663 18,141 18,406 18,674 18,946 19,216 19,488 19,762 20,037 20,314 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 94,915 95,541 96,172 96,812 97,459 98,115 98,780 99,453 100,123 100,798 101,477 102,162 102,850 0 0 0 0 0 0 0 0 0 0 0 0 0 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 0 0 0) 0 0 0 0 0 0 0 0 0 0 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 15,814 16,424 17,040 17,663 18,291 18,923 19,563 20,212 20,857 21,506 22,161 22,819 23,483 0 0 0 0 8 27 47 67 86 106 126 146 167 221 205 189 173 161 156 151 146 141 136 131 126 120 94,915 95,541 96,172 96,812 97,459 98,115 98,780__99,453_ 100,123 100,798 _101,477_ 102,162 __102,850_ 0 0 0 0 0 0 0 0 0 0 0 0 at R.W. Beck Result:Pag aM x f # f Allison Lake Case-No SG Cost Med-Hi Load; Low Fuel Replace Ex. Diesel at OI Diesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertic Costs Allison Lake Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power 19-Jul-94 f i ' b. te i } Copper Valley Electric Association - Su tton/Glennallen Intertie Economic Analysis (Constant 1993 Dollars 000) 2 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 $1,384 $1,535 $1,828 $1,947 $1,892 $1,852 $1,868 $598 $636 $675 $710 $744 $779 786 867 1,017 61 695 A94 416 124 131 138 145 151 158 0 0 0 0 0 0 0 (146) (146) (146) (146) (146) (146) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 26 26 26 26 26 26 26 26 26 26 0 0 0 102 204 307 409 409 409 AQY 409 409 409 $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $2,719 $1,010 $1,057 $1,103 $1,144 $1,185 $1,225 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 / $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 0 0 0 0 0 0 0 284 284 284 284 284 284 $0 $0 $0 $0 $0 $0 $0 $1,465 $1,465 $1,465 $1,465 $1,465 $1,465 $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $2,719 $2,475 $2,521 $2,568 $2,609 $2,650 $2,690 | 0 0 0 0) 0 0) 0 0 0 0 0) 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,169 $2,403 $2,845 $2,935 $2,816 $2,678 $2,719 $2,475 $2,521 $2,568 $2,609 $2,650 $2,690 Present Value in 1993 dollars (Discounted @4.5%) Cumulative (1993 - 2018) $41,550 (in thousands) 30 Year (2019 - 2048) with no additional growth 17,018 (in thousands) Total Net Present Value $58,567 (in thousands) R.W. Beck Result:Page \llison Lake Case-No SG Cost ded-Hi Load; Low Puel teplace Ex. Diesel atOlH Jiesel Costs Fuel Variable O&M ixisting Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost ntertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Costs Allison Lake Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertie Economic Analysis (Constant 1993 Dollars 000) 2006 2007 2008 2009 2010 2011 201 2013 2014 2015 2016 2017 2018 $813 $848 $884 $921 $958 $996 $1,035 $1,074 $1,114 $1,154 $1,195 $1,237 $1,279 164 170 177 183 190 197 204 211 219 226 234 241 248 (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) 0 0 0 0 0 0 0 0 0 0 0 ~ 0 0 26 26 26 26 26 26 26 26 26 26 26 26 26 409 A409 409 409 409 409 409 409 409 409 409 409 409 $1,266 $1,308 $1,350 = $1,393 $1,436 $1,482 $1528 $1,575 $1,622 $1,669 $1,718 $1,767 = $1,816 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 284 284 284 284 284 284 284 284 284 284 284 284 284 $1,465 $1465 $1,465 $1465 $1,465 $1,465 $1,465 $1,465 $1,465 $1,465 $1,465 $1,465 $1,465 $2,731 $2,772 $2,815 $2,857 $2,901 $2,947 $2,993 $3,040 $3,087 $3,134 $3,183 $3,232 $3,281 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,731 $2,772 $2,815 $2,857 $2,901 $2,947 $2,993 $3,040 = $3,087 $3,134 $3,183 $3,232 $3,281 | R.W. Beck Result:Page ASSUMP HONS Run Descriptions ===> =ne> Gulch Winter Gen 21,000 MWh Run Options (leyes; 0#no) Conservation Intertie Allison Lake jilver Lake ==> Coal Facility ==> Other ===> Load Forecast (1LM,1) ==> Fuel Price (XILILL) see> Iydro Conditions (A,1.) ===> — Copper Valley Electric Association - Sutton/Glennatlen Intertle Allison Lake Case-No SG Cost Med Hi Load; Low Fuel Replace Ex, Diesel at OU Adjustment to Existing Diesel O&M Labor Costs for Alternative Usage Levels Standby MaseLoad % Solar Turbine Purchase Price of Intertie Energy ===> ===> New Diesel Additions <=> Net KW Plant sizes 1610 2150 3220 4300 Note: To assist in determining the timing of new resources, use macro <AltoG. Then use macro <AlD to return to normal mode. <AloT then transfers the input section to the summary file Existing Units ===> 19-Jul-94 Include Yr Onlin Location 0 1994 Hoth 0 1999 Glennallen 1 200 Valdez 0 2001 Vaklez Option ===> b 0 1998 Valdez 9 1997 Valdez m h | a Savings Allison Lake Year ($1000) Intertie Silver Lake and Coal 200 5.5 SM) 145.5 2 3000 wi 2050 2550 500 2050 Station Us 5% Valdez Gen All Bll Only No Bhd 3.6% Select 50 aon leyilen 1 Estimate of economy energy fuel costs only 0 Includes estimate of fixed related costs Valdez, Glenallen Unit Year Cap(K New/Re Unit Year Cap (K New/Rep 1 1997 2,150 1 1996 2,150 nv 2 1998 2,150 & 2 1999 2,150 + S 3000 2,150 & 3 3000 2,150 n 4 302,150 4 O00 2,150 5 300 2,150 5 wo 2,150 6 300 2,150 6 00 2,150 a JW) 2,150 7 woo 2,150 8 3000 2,150 8 woo 2,150 9 yO 2,150 9 3000 2,150 10 3000 2,150 10 3000 2,150 Valdez Glenallen Unit Retire Year Unit Retire Year 1 3000 1 1989 2 3000 2 lyBy 3 3000 3 000 4 1997 4 3000 5 3000 5 3000 6 1998 6 1999 7 3000 7 3000 R.W. Beck Result:Ps ASSUMPTIONS Economic and Financial Options General Inflation Real Discount Rate Real Interest Rate HW Construction Inflator CPI 1993/1992 Finance Cost Finance Life (in years) Diesel Hydro Intertie Proposed Coal Other ===> Maximum Seasonal Plant Factor Existing Diesel New Diesel Base price of Fucl 1993 ($/gal) #2 Fucl Oil Hago Transmission Losses Valdez - Glennallen Intertie Hours Per Season 19-Jul-94 Winter Summer Copper Valley Electric Association - Sutton/Glennallen Interti 0.0% 4.5% 1.5% 4.2% 3.2% (Blue Chip Indicator) 0.0% 20 a 35 30 0 35% 60% Valdez 0.70 0.68 3.0% 9.7% 5832 2928 Glen 0.75 0.73 Intertie Availability Factor 0.98 (October - May) (June - September) R.W. Beck Result:Pag All Diesel Case Low Load; Low Fuel Replace Ex Diesel at OF Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertie Other New Diesel Valdez New Diesel Glennallen Existing, Diesel Valdez Existing Diesel Glennallen Total Firm Capacily Valdez . Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) Glennallen Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Capacily Balance (KW) 2004 200! 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 4,748 9,086 9,876 9892 9,727, —- 9,559 9,566 9,573 > 9,580 9,575 9,561 9,543 9,525 3,885 3,976 4,057 4,143 4,174,093 4,070 4,049 4,029 4,001 3,974 3,948 3,922 12,633 13,063 13,933 14,035 13,844 13,651 13,637 = 13,622 13,609 13,576 13,534 13,91 13,448 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5,000 =5,000 5,000 =5,000 5,000 = 5,000 5,000 5,000 =5,000 =5,000 5,000 5,000 ~—— 55,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0: 2,150 4,300 4,300 4,300 4,300 4,300 4,300 4,300 4,300 0 0 0 2,150 2,150 2,150 2,150 4,300 4300 4,300 4,300 4,300 4,300 9,750 9,750 9,750 9,750 8,050 7,100 7A00 7A00 7,00 7,100 7A00 - 7,100 7,100 6,800 6,800 6,800 6,800 6800 6,800. 6,800. 4,31) 4,300 4,300 430) 4,300 4,300 21,550 21,550 21,550 23,700 24,150 = 25,350 25,350) 25,000) 25,000 25,000 25,000 25,000 25,000 8,748 9,086 9,876 9,892 9,727 9,559 9,566 9,573 9,580 9,575 9,561 9,543 9,525 2,500 2,500 2,500 2,500 2,500 2,500 2,500 . 2,500 2,500 2,500 2,500 2,500 2,500 11,248 11,586 12,376 _12,392__ 12,227 12,059 12,066 12,073 12,080 _ 12,075 _12,061__12,043 12,025 14,750 14,750 14,750 14,750 15,200 16,400 16400 16400 16400 16400 16,400 16,400 16,400 3,502 3,164 2,374 2358 2,973 4,341 4,334 4,327 4320 4325 4,339 4357 4,375 3,885 3,976 4,057 4,143 4,117 4,093 4,070 4,049 4,029 4,001 3,974 3,948 3,922 2,500 2,500 2,500 2,500 2500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 6385 6,476 6,557 6,643 6,617,593 6,570 6549 6529 6501 6,474 6448 6,422 6,800 6,800 6,800 8,950. 8950 8,950. 8,950 8,600. 8,600. 8,600 8,600 8,600 8,600 415 324 24300 «2307-2333 2,357) 2,380 2,051 2,071 2,099 2,126 32,152 .2,178 R.W. Beck Result:Pi All Diesel Case Low Load; Low Fuel Replace Ex Diesel at OH Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertie Other New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacity Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) Glennallen Peak Demand Reserves . Total Capacity Requirements Local Resources Surplus /(Deficit) 19-Jul-94 f ' ES E Poy or F i ' Et, 8 ' j } f i Re k i ! } } ‘ { ! z Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Capacity Halance (KW) 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 9,507 9,488 9,470 9,452 ANE 9,306 9,233, 6,760 6,760 6,760 6,760 6,760 6,760 - 3,898 3,875 3852-3830 3,809 3,245 2,967 2,689 2,689 2,689 2,689 2,689 2,689 13,405 13,363 13,322 13,282 13,212 12,550 12,400 9,449 9,449 9449 9,449 9,449 9449 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0) 0 0 0 0 0 0 0 5,000) 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 4300 §=4300 «©4300 =4300 4300) 4,300 4,300) 4,300 4,300 4,300 4,300 4,300 4,300 4300 4,300 4,300 4,300 4,300) 4,300) 4300 4,300 4,300 4,300 4,300 4,300 4,300 7100 7,100 7,100 7,100 7A0O0 7,100 7,100 7,100 "7,100 7,00 7A00 7,100 7,100 4300 4300 4300 430043004300 43004300 4,300__4,300__ 430043004300 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 9507 YABB 9,470 9,452 9404 9,306 9,233 6,760 6,760 6,760 6,760 6,760 6,760 2,500 2,500 2,500 2,500 2500 2,500 2500 2,500 2,500 2,500 2,500 2,500 2,500 12,007 11,988 11,970__11,952_ 11,904 11,806 11,733___9,260__—9,260___—9,260___—9,260__-9,260 9,260, 16,400 16,400 16,400 16,400 16,400 16,400 16,400 16,400 16,400 16,400 16,400 16,400 16,400 4393 4412 4430 4,448 4496 4,594 4,667 7,140 7,140 7,140 = 7,140 7,140 7,140 3,898 3,875 3,852 3,830 3,809 3,245 2,967 2,689 2,689 2,689 2,689 = 2,689 2,689 2,500 2,500 2,500. 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 6398 6,375 6,352 6,330 6,309 5,745 54675, 1895189 5,189 5,189 5,189 5,189 8,600. y 8,600 H / 2,202 2,225 8,604) 2,248 8,600 2,270 8.600 8,600 2,291 = 2,855 R.W. Beck 8,600 8,600 3,133 3,411 8,600 3,411 8,600 8,600 3,411 3,411 8,600 8,600 3,411 3,411 Result:Pa iz u . zt ' All Diesel Case Low Load; Low Fuel Replace Ex Diesel at OF Valdez Energy Requirements Generation for Valdez Load Conservation Valdez Solomon Gulch Intertic Other New Diesel Valdez Existing Diesel Valdez Deficit Glennallen Energy Requirements Generation for Glennallen Load Conservation Glennallen Solomon Gulch Intertic Other New Diesel Glennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertie Other New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 om Copper Valley Electric Association - Sultpn/Glennallen Intertic Load and Resource Energy Balance (MWh) 1993-1994 1995 9G s1997 1998 1999 2000, 2001 2002, 2003, 2004 2005 51,067 53,750 59,639 59,736 58,764 57,776 57,818 57,858 57,896 57,865 57,779 57,677 57,569 0 0 0 0 0 0 0 0 0 0 0 0 0 40,320 41,125 42,892 42,921 42,629 42,333 42,345 42,357 42,369 42,360 42,334 42,303 42,271 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Q 10494 14,671 14,699 14,725 14,751 14,730 14,673. 14,605 14,534 10,747 12,625 16,747. 16,815 5,641 772 774 775 776 775 772 769 765 0 0 0 0 0 0 0 0 0 0 0 0 0 20,484 20,554 20,540 = 20,583 20,451 20,326 = 20,214 20,109 = 20,008 19,869 19,733. 19,603 19,476 0 0 0 0 0 0 0 0 0 0 0 0 0 6,145 6,166 6,162 6,175 6,135 6,098 — 6, Mot 6,033 6,002 5,961 5,920 5,881 5,843 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 11,300 11,300) 11,300) 11,300 14,076 14,006 13,908 13,813. 13,722 13,633 14,339 14,388 14,378 3,107 3,016 2,928 2,850. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 71,550 74,304 80,179 80,319 79,215 78,102 78,033 77,966 77,904 77,734 77,512 77,280 77,046 0 0 0 0 0 0 0 0: 0 0 0 0 0 46,655 47,482 49,244 49,287 48,954 48,619 48,597 48,576 48,557 48,504 48,437 48,366 48,294 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0) 0 0 11,300 21,794 25,972 26,000 28,801 28,757 28,638 ~=—28,486 928,327 28,167 25,085 27,013 31,125. 19,923 8,656 = 3,700 3,623 775 776 775 772 769 765 190 11 191 191 190 189 188 187 186 184 183 182 181 71,550 74,304 80,179 80,319 __79,215_78,102__78,033__ 77,966 _77,904_77,734__77,512__77,280__77,046 0 0 0 0 0 0 0 0 0 0 0 0 0 R.W. Beck Result:Pay All Diesel Case Low Load; Low Fucl Replace Ex Diesel at OF Valdez Energy Requirements Generation for Valdez Load Conservation Valdez Solomon Gulch Intertic Other New Diesel Valdez Existing Diesel Valdez Deficit Glennallen Energy Requirements Generation for Glennallen Load Conservation Glennallen Solomon Gulch Intertie Other New Diesel Glennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertie Other New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 10.1991-94 i j I Be 5 E i 4 ' | i i Copper Valley Electric Association - Sutton/Glennallen Intertie Load and Resource Energy Balance (MWh) 2006 20027, 28 2009, 2010 20102012, 201 0A IS 2G 2017 2018 57,459 57,349 57,240 57,133 56,846 56,235 55,791 35,791 35,791 35,791 35,791 35,791 35,791 0 0 0 0 0 0 0 0 0 0 0 0 0 42,238 42,205 42,172 42,140 42,054 41,871 41,737 35,737 35,737 35,737 35,737 35,737 35,737 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 14,460 14,387 14,315 14,244 14,053. 13,647 13,351 51 51 51 51 51 51 761 757 753 750 740 718 703 3 3 3 3 3 3 0 0 0 0 0 0 0 0 0 0 0 0 0 19,354 19,237 19,123, 19,014 18,907 16,094 14,709 13,570 13,570, 13,570 13,570, 13,570 13,570 0 0 0 0 0 0 0 0 0 0 0 0 0 5,806 5,771 S77 5,704 5,072 4,828 4Als 4,071 4,071 4,071 4,071 4,071 4,071 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 13,548 13,466 13,386 13,310 13,235 11,266 = 10,297, 9 AND 9499 999 9,499 9,499 9,499 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 76,814 76586 76,364 76,147 75,754 72,330 70500 49,360 49,360 49,360 49,360 49,360 49,360 0 0 0 0 0 0 0 0 0 0 0 0 0 48,224 48,154 48,086 48,020 47,901 46,848 46,286 39,934 39,934 39,934 39,934 39,934 = 39,934 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 28,009 27,853. 27,701 27,553 27,288 «24,913 23,647 9,550) 9,550 9,550 = 9,550 9,550 9,550 761 757 753 750) 740 718 703 3 3 3 3 3 3 180 178 177 176 175 149 136 126 126 126 126 126 126 76,814 76,586 76,364 __76,147__75,754__72,330__70,500__49,360__49,360_49,360_49,360_49,360__49,360 0 0 0 0 0 0 0 0 0 0 0 0 0 R.W. Beck Result:Pa All Diesel Case Low Load; Low Fuel Replace Ex Diesel at OH Diesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cust Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Costs Other Annual Carrying Charge Annual O&M Costs ‘Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003, 2004 2005 $1,373 $1,484 $1,730 $1,646 $1,539 $1,473 $1,477 = $1,466 $1,470 $1,471 $1,469 $1,468 $1,466 780 840 967 736 495 384 382 322 322 321 319 317 316 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0) 0 0 0 0 0 21 21 0) 0 0 26 26 26 26 26 26 26 26 26 26 0 0 0 102 204 307 307 409 409 409 409 409 409 $2,152 $2,324 $2,698 $2,510 $2,264 $2,190 $2,191 $2,223 $2,227 $2,226 $2,223 $2,240 $2,237 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 | $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,152 $2,324 $2,698 $2,510 $2,264 $2,190 $2,191 $2,223 $2,227 $2,226 $2,223 $2,240 $2,237 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,152 $2,324 $2,698 $2,510 $2,264 $2,190 $2,191 $2,223 $2,227 $2,226 $2,223 $2,240 $2,237 Present Value in 1993 dollars (Discounted @4.5%) Cumulative (1993 - 2018) $31,728 (in thousands) 30 Year (2019 - 2048) with no additional growth 5,561 (in thousands) Total Net Present Value 3 $37,288 (in thousands) R.W. Beck Result:Pag } Pi ROM = a All Diesel Case Low Load; Low Fuel Replace Ex Diesel at OF Diesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Costs Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power i-9¢ i. en E Ri Re ' ; \ ' § : ee Pe BSS BR ta bee Boe Bath fee Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 2006 2007 2008 2009 2010 011 2012 2013 2014 2015 2016 2017 01 $1,464 $1,462 $1,461 $1,459 $1,452 $1,333 $1,271 $507, $509 $511 $513 $516 $518 314 312 310 309 306. 280 267 99 99 99 99 99 99 0 0 0 0 0 0 0 0 0 ) 0 0 0 21 21 21 21 21 21 21 21 21 21 21 21 21 26 26 26 26 26 26 26 26 26 26 26 26 26 409 409 409 409 409 409 409 409 409 409 409 409 409 $2,233 $2,230 $2,226 $2,223 $2,213 $2,068 $1,993 $1,061 $1,063 $1,065 $1,068 $1,070 — $1,072 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 906 g)siH—iHCiaHCOHOH HH OH GO $0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0. $0 $0 $0 $0 $0 $0 $2,233 $2,230 $2,226 $2,223 $2,213 $2,068 $1,993 $1,061 $1,063 $1,065 $1,068 $1,070 $1,072 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0. $0 $0 $0 $0 $0 $2,233 $2,230 $2,226 $2,223 $2,213 $2,068 $1,993 $1,061 $1,063 $1,065 $1,068 $1,070 $1,072 DAW, Bock Result:Pa ASSUMPTIONS Run Descriptions Gulch Winter Gen 21,000 MWh Run Options (leyes; 0=no) Conservation Intertle Allison Lake Silver Lake <=> Coal Facility ===> Other ===> Load Forecast (ILM,L) eae> Fuel Price (XILILL) ==> Hydro Conditions (A,L) —> Copper Valley Electric Association - Sutton/Glennallen Intertie All Diesel Case Low Load; Low Fuel Replace Ex Diesel at O11 Adjustment to Existing Diesel O&M Labor Costs for Alternative Usage Levels Standhy ===> Baseload ===> % Solar Turbine ===> Purchase Price of Intertie Energy Economy 1 ===> Economy 2 -—=> New Diesel Additions ==> Net KW Plant sizes 1610 2150 3220 4300 Note: To assist in determining the timing of new resources, use macro <Alt>G. Then use macro <Alt>D to return to normal mode, <Alt>T then transfers the input section to the summary file Existing Units ==> 19-Jul-94 Include Yr Onlin Jaxation 0 1994 Both 0 1999 Glennallen Nov 1, 1997 0 2000 Valdez 0 2001 Valdez Option ===> b 0 1998 Valdez 0 1997 Valdez | | | a Savings Allison Lake Year ($1000) Intertie | Silver Lake and Coal 3000 500 5) 145.5 sooo 2 2050 2550 soo 2050 Station Us 5% Valdez Gen All Bld Only No Bld 3.6% Select 500 2004 JayMan 1 Estimate of economy energy fuel costs only (Includes estimate of fixed related costs Valdez Glenatlen Unit Year Cap(K New/Re Unit Year Cap(K New/Kep 1 1997 2,150 © 1 1996 2,150 n 2 1998 2,150 Fr 2 2000 2,150 Fr 3 30000 2,150 3 00 2,150 4 3000 2,150 4 30002150 5 3000 2,150 5 3000, 2,150 6 3000 2,150 6 3000 2,150 Uf 3000 2,150 7 3000 2,150 8 won 2,150 8 30002150 9 300 2,150 9 3000, 2,150 10 3000 2,150 w 300 2,150 Valdez, Glenallen Unit Retire Year Unit Retire Year 1 3000 1 1989 2 3000 2 1989 3 3000 3 00 4 1997 4d 3000 5 300 5 3000 6 1998 6 2000 a a0 7 3000 R.W. Beck Result: ASSUMPTIONS Economic and Financial Options General Inflation ===> Real Discount Rate Real Interest Rate HW Construction Inflator = CPI 1993/1992 = Finance Cost ==am> Finance Life (in years) Diesel Hydro Intertic Proposed Coal Other Maximum Seasonal Plant Factor Existing Diesel ===> New Diesel ===> Base price of Fuel 1993 ($/gal) #2 Fuel Oil ===> Hago ===> Transmission Losses Valdez - Glennallen ===> Intertie =a=> Hours Per Season Winter ===> Summer ===> 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Interti 0.0% 4 5% 1.5% 4.2% 3.2% (Blue Chip Indicator) 0.0% 20 35 35 30 0 35% 60% Valdez Glen 0.70 0.75 0.68 0.73 Intertie Availability Factor 3.0% 0.98 9.7% 5832 (October - May) 2928 (June - September) R.W. Beck Result:Pa; Intertie Case Low Load; Low Fuel Replace Ex Diesel at OT Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertic Other New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacity Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) Glennallen Peak Demand Reserves Total Capacity Requirements Local Resources Surplus/(Deficit) 19-Jul-94 i i i rei E F ; i ¢ i j Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Capacily Balance (KW) 1993 1994 1995, 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 8,748 9,086 9,876 9,892 9,727, 9,559 9,566 9573 9580 9,575 9,561 9543 9,525 3,885 3,976 4,057 4,143 4,117__—4,093___4,070 4,049 4,029 4,001 3,974 3,948 3,922 12,633 13,063 13,933 14,035 13,844 13,651 19,634 13,622 13,609 13,576 13,534 13,491 13,448 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5,000 5,000 5,000 5,000 5,000 5,000 6,500 6500 6500 6500 6500 6500 6500 o-- --- --- --- --- --- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 9,750 9,750 9,750 9,750 9,750 9,750 9,750 Y,750 = °9,750 9,750 9,750 9,750 9,750 6,800 6800 68006800 6800 6,800 6800 680068006800 6,800 6,800 6,800 21,550 21,550 21,550) 21,550) 21,550) 21,550) 23,050 23,050) 23,050) 23,050 = 23,050 = 23,050 = 23,050 8,748 9,086 9,876 9,892 9,727 9,559 9,566 9573 9580 9575 9,561 9543. 9,525 2,500 2,500 2,500 2500 2500 2,500 2,500 2500 2500 2500 2,500 2,500 2500 11,248 11,586 12,376 12,392 12,227 12,059 12,066 12,073 12,080 12,075 12,061 12,043 12,025 14,750 14,750 14,750 14,750 14,750 14,750__16,250 16,250 16,250 16,250 16,250 _16,250 _16,250 3502 3,164 2,374 2358 2,523 2,691 4,184 4177 4170 4,75 4,189 4,207 4,225 | 3,885 3,976 4,057 4,143 4,117 4,093 4,070 4,049 4,029 4,001 3,974 3,948 3,922 2500 2,500 2,500 2500 2500 2,500 0 0 0 0 0 0 0 6385 6,476 __—6,557__—6,643_ 66,6176, 5934070 4,049 4,029 4,001 3,974 3,948 3,922 6800 6,800 6,800 6,800 6,800 6,800 6,800 6,800 6,800 6,800 6,800 6,800 6,800. 415 324 243 157 183 207. 2,730 2,751 2,771 -° 2,799 2,826 2,852 2,878 R.W. Beck Result:Page Intertie Case Copper Valley Electric Association - Sutton/Glennallen Intertic Low Load; Low Fuel Load and Resource Capacity Balance (KW) Replace Ex Diesel at OF 2006 2007, 20K 2009 2000201 202201 201A 201 2016-2017, 2018 Valdez Peak Demand 9507 9,488 9,470 9,452 9,404 9,306 9,233, 6,760 6,760 6,760 6,760 6,760 «6,760 Glennallen Peak Demand 3,898 3,875 3,852 3,830 3,809 3,245 2,967,689 2,689 2,689 2,689 2,689 2,689 Total CVEA Demand 13,405 13,363 13,322 13,282 13,212 12,550 12,200 9,449 9449 9,449 9449 9,449 9449 Firm Capacity Conservation Valdez 0 0 0 0 0 0 0 0 0 0 0 0 0 Conservation Glennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 6500 6,500 6500 6500 6500 6500 6500 6500 6500 6500 6500 6,500 6500 Intertie 0 0 0 0 0 0 0 0 0 0 0 0 0 Other 0 0 0 0 0 0 0 0 0) 0 0 0 0 New Diesel Valdez 0 0 0 0 0 0 j0 0 0 0 0 0 0 New Diesel Glennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Existing Diesel Valdez 9,750 9,750 9,750 9,750 9,750 = 9,750 9,750 9,750 9,750 9,750 9,750 9,750 9,750 Existing Diesel Glennallen 6,800 6,800 6,800 6800 6,800 6,800 68006, 8006, 800 6,800 6, 800_ 6,800 6,800_ Total Firm Capacity 23,050 23,050 = 23,050 = 23,050 = 23,050 23,050 23,050 = 23,050 = 23,050 = 23,050 = 23,050 = 23,050 23,050 Valdez Peak Demand 9,507 9,488 9,470 9,452 9404 9,306 9,233 6,760 6,760 6,760 6,760 6,760 6,760 Reserves 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 Total Capacity Requirements 12,007 11,988 11,970 11,952 11,904 11,806 11,733 9,260 9,260 9,260 9,260 9,260 9,260 Local Resources 16,250 16,250 16,250 16,250 16,250 16,250 16,250 16,250 16,250 16,250 16,250 __16,250 16,250 Surplus /(Deficit) 4,243 4,262 4,280 4,298 4,346 4,444 4517 6,990 6,990 6,990 6,990 6,990 6,990 Glennallen ; Peak Demand 3,898 3,875 3,852 3,830 3,809 3,245 2,967 2,689 2,689 2,689 2,689 2,689 2,689 Reserves 0 0 0 0 0 0 0 0 0 0 0 0 0 Total Capacity Requirements 3,898 3,875 3,852 3,830 3,809 3,245 2,967 2,689 2,689 2,689 2,689 2,689 2,689 Local Resources 6,800 6,800 6,800) 6,800 6,800 6,800 6,800 6,800 6,800 6,800 6,800 6,800 6,800 Surplus /(Deficit) 2,902 2,925 2,948 2,970 2,991 3,555 3,833 4,111 4,111 4,111) 4,111 4,111 4,111 19-Jul-94 R.W. Beck Result:Pag CU BUA eH UFOs ATES TT Rea I EEF } en lne | van Intertie Case Copper Valley Electric Association - Sutton/Glennallen Intertic Low Load; Low Fuel Load and Resource Energy Balance (MWh) Replace Ex Diesel at OF! 1993 1994 1995, 1996 7. 1999 2000 2001 2002 2003 2004 2005 Valdez Energy Requirements 51,067 53,750 59,639 59,736 58,764 57,776 57,818 57,858 57,896 57,865 57,779 57,677 57,569 Generation for Valdez Load Conservation Valdez 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 40,320 41,125 42,892 42,921 42,629 42,333 42,345 42,357 42,369 42,360 42,334 42,303 42,271 Intertic 0 0 0 0 0 9 153063) 1550901111 5:207) 1531 95)11551367 1) 1153067, 11114:992 Other 0 0 0 0 0 0 0 0 0 0 0 0 0 New Diesel Valdez 0 0 0 0 0 0 LO) 0 0 0 0 0 0 Existing Diesel Valdez 10,747 12,625 16,747 16,815 16,135 15,443 309 310 311 310 309 307 306 Deficit 0 0 0 0 0) 0 0 0 0 0 0 0 0 Glennallen Energy Requirements - 20,484 20,554 = 20,540 = 20,583 20,451 20,326 = 20,214 20,109 = 20,008 19,869 19,733. 19,603 19,476 Generation for Glennallen Load Conservation Glennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 6,145 6,166 6,162 6,175 6,135 6,098 — 6,064 6,033 6,002 5,961 5,920 5,881 5,843 Intertic 0 0 0 0 0 0 13,867 S579 110110133726))))113,630)))) 13/537, 1344713 361 Other E 0 0 0 0 0 0 0 0 0 0 0 0 0 New Diesel Glennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Existing Diesel Glennallen 14,339 14,388 14,378 14,408 14,316 14,228 243 282 280 278 276 274 273 Deficit 0 0 0 0 0 0 0 0 0 0 0 0 0 CVEA System Requirements 71,550 74,304 80,179 80,319 79,215) 78,102 78,033 77,966 77,904 77,734 77,512 77,280 77,046 Total Generation for CVEA System } Conservation Copper Valley 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 46,655 47,482 49,244 49,287 48,954 48,619 48,597 48,576 48,557 48,504 48,437 48,366 48,294 Intertie 0 0 0 0 0 0 29,499 29,455 29,413 29,295 29,141 28,980 = 28,817 Other 0 0 0 0 0 0 0 0 0 0 0 0 0 New Diesel CVEA 0 0 0 0 0 0 0 0 0 0 0 0 0 Existing Diesel CVEA 25,085) 2743 |)/31,125 31,223 | 30,451 29,671 592 592 591 588 585 582 579 Less Transmission Losses V-G 190 191 191 191 190 189 657 656 656 654 651 648 644 Total 71,550 74,304 80,179 80,319 79,215 78,102 78,033__-77,966__77,904__77,734__77,512__77,280 77,046 Deficit 0 0 0 0 0 0 0 0 0 0 0 0 - 0 19-Jul-94 R.W. Beck Result:Pa; t F e 8 1 f ' ' RNG eA’ STU IREEUI IES 1 a ee ee oe Re eR OB ! TSO EEA Gat K Intertic Case Copper Valley Electric Association - Sutton/Glennallen Intertic Low Load; Low Fuel Load and Resource Energy Balanee (MWh) Replace Ex Diesel at OF PANN II) 2UMIZAIN ZAMBIAN ZOE ZOE L2O12 MOIS HNN ZOE iii 2UNSt T ZOIG Han Z01Z 2018 Valdez Energy Requirements 57,459 57,349 57,240 57,133 56,846 56,235 55,791 35,791 35,791 35,791 35,791 35,791 35,791 Generation for Valdez Load Conservation Valdez 0 0 0 iO 0 0 0 0 0 0 0 0 0 Solomon Gulch 42,238 42,205 42,172 42,140 42,054 41,871 41,707 35,737 35,737. 35,737 35,737 35,737. 35,737 Intertic 14,917 14,842 14,767 14,693 14,497 14,077 13,772 52 52 52 52 52 52 Other 0 0 0 0 0 0 0 0 0 0 0 0 0 New Diesel Valdez 0 0 0 0 0 0 0 0 0 0 0) 0 0 Existing Diesel Valdez 304 303 301 300 296 287 281 1 1 1 1 1 1 Deficit 0 0 0 0 0 0 0 0 0 () 0 0 0 Glennallen Energy Requirements 19,354 19,237 19,123 19,014 18,907 16,094 14,709 13,570 13,570 13,570 13,570 13,570 13,570 Generation for Glennallen Load Conservation Glennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 5,806 5771 5,737 5,704 5,672 4,828 4,413 4,071 4,071 4,071 4,071 4,071 4,071 Intertic¢ TS27 ZAMAN S TAG MNS, WES nS Abad 0 2eeON NU Cbd a C0 9,309 9,309 9,309 9,309 9,309 9309 Other 0 0 0 0 0 0 0 0 0 0 0 0 0 New Diesel Glennallen 0 0 0 0 0 0 0 0 0 0 0 0 0 Existing Diesel Glennallen 271 269 268 266 265 225 206 190 190 190 190 190 190 Deficit 0 0 0 0 0 0 0 0 0 0 0 0 0 CVEA System Requirements 76,814 76,586 76,364 76,147 75,754 72,330 70,500 49,360 49,360 49,360 49,360 49,360 49,360 Total Generation for CVEA System , Conservation Copper Valley 0 0 0 0 0 0 0 0 0 0 0 0 0 Solomon Gulch 48,224 48,154 48,086 48,020 47,901 46,848 46,286 39,934 39,934 39,934 39,934 39,934 39,934 Intertic 28,656 28497 28,342 28,191 27,915 25,554 24,289 9363 9,363 9363 9,363 9,363 9,363 . Other 0 0 0 0 0 0 0 0 0 0 0 0 0 New Diesel CVEA 0 0 0 0 0 0 0 0 0 0 0 0 0 Existing Diesel CVEA 575 572 569 566 561 513 487 191 191 191 191 191 191 Less Transmission Losses V-G 641 638 634 631 624 585 562 128 128 128 128 128 128 Total 76,814 76,586 76,364 _76,147 75,754 72,330 70,500 49,360 49,360 49,360 49,360 49,360 49,360. Deficit 0 0 0 0 0 0 0 0 0 0 0 0 SHO, 19-Jul-94 R.W. Beck Result:Pag Intertic Case Low Load; Low Fuel Replace Ex Diesel at OF Diesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Costs Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenuc(Coal Case) Net Annual Cost of Power 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 $1,373 $1,484 $1,730 $1,744 $1,704 $1,663 $33 $33 $33 $33 $33 $33 $33 780 840 967 970 946 922 18 18 18 18 18 18 18 0 0 0 0 0 0 (560) (560) (560) (560) (560) (560) (560) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $2,152 $2,324 $2,698 $2,714 $2,650 $2,585 — ($509) ($509) ($509) ($509) ($509) ($509) ($509) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 | -_ --- -_ -- _ -_ $1,031 $1,012 $993 $975 $958 $941 $925 --- -— --- - o-- ad 207 207 207 282 207 207 207 0 0 0 0 0 0 1,179 1,180,182 1180 1,177___—i.,.174 1,171 $0 $0 $0 $0 $0 $0) $2,417) $2,399) $2,382 $2,437 $2,342 $2,322 $2,302 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0. $0 $0 $0 $0 $0 $0 $2,152 $2,324 $2,698 $2,714 $2,650 $2,585 $1,908 = $1,890 $1,873 $1,928 $1,833 $1,813 $1,793 0 0 0 eo 0 0 4,009 4,030 4,049 4,102 4,169 4,240 4,312 $0 $0 $0 $0 $0 $0 ($145) ($146) ($147) ($149) ($152) ($155) ($158) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 | $2,152 $2,324 $2,698 $2,714 $2,650 $2,585 Present Value in 1993 dollars (Discounted @4.5%) Cumulative (1993 - 2018) 30 Year (2019 - 2048) with no additional growth Total Net Present Value R.W. Beck $1,763 $1,744 $1,726 $1,779 $1,681 $1,658 = $1,635 $26,716 (in thousands) 2,057 (in thousands) $28,773 (in thousands) Result:Pag¢ Intertie Case Low Load; Low Fuel Replace Ex Diesel at OF Diesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertic Costs Other Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy , Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 2006 007, 200 2009-2010, 2010 2012, 2013 2014 2015 016 = 2017 2018 $33 $33 $33 $33 $33 $30 $29 $i $11 $11 $11 $11 $11 18 18 18 18 17. 16 15 6 6 6 6 6 6 (560) (560) (560) (560) (S60) (560) (560) (560) (560) (56) (S60) (S60) (560) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ($509) ($509) ($510) ($510) = ($510) ($514) ($516) ($543) ($543) ($543) ($543) ($543) ($543) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $909 «$894 $880) FROGS FBS2— HBO FB26- FBIA FBZ $790 $779 $768 $758 207 282 221 221 221 221 346 240 240) 240) 240 269 269 1,167 1,164,161 1,158 1,150 1,055,006 389 390 391 392 393 394 $2,283 $2,340 $2,262 $2,244 $2,223 $2,115 $2,178 $1,443 $1,432 $1421 $1,411 $1,430 $1,421 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,774 $1,830 $1,752 $1,735 $1,713 $1,601 $1,662 $900 BEKO $879 HBG HBB $879 4382 4,452 4,520 4,586. 4,705 5,758 6320 12,672 12,672 12,672 12,672 12,672 = 12,672 ($161) ($164) ($167) ($170) ($175) ($215) ($236) ($475) ($477) ($478) ($479) ($481) ($482) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,613 $1,666 $1,585 $1,565 $1,538 $1,386 $1,425 $425 $412 $401 $389 $407 $397 R.W. Beck Result:Pag ASSUMPTIONS Run Descriptions Intertie Case Low Load; Low Fuel Gulch Winter Gen 21,000 MWh ===> Replace Ex Diesel at O11 Run Options (l-yes; 0=no) Include Yr Onlin Location Copper Valley Electric Association - Sutton/Glennallen Intertie Conservation 0 1994 Both Intertle 1 1999 Glennallen Nov 1, 1997 Allison Lake 0 2000 Valdez Silver Lake 0 2001 Valdez Option ===> b Coal Facility 0 1998 Vaklez Other 0 1997 Valdez Load Forecast (1M,1.) ==> ' ! Fuel Price (XILILL) sone Ilydro Conditions (A,1.) a Adjustment to Existing Diesel O&M Labor Costs for Alternative Usage Levels Savings Allison Lake Year ($)000) Intertle Silver Lake and Coal Standby ===> 1999 -560 560-1455 Wasel.oad ===> A000 21 2050 2550 500 2050 Station Us % Solar Turbine ===> 5% Valdez Gen All Bid Only No Bid 3.6% Select 500 3000 Purchase Price of Intertle Energy Jay Onn Economy 1 => 1 Estimate of economy energy fuel costs only Economy 2 ===> 0 Includes estimate of fixed related costs Valdez, Glenallen Unit Year Cap(K New/Re — Unit Year Cap(K New/Rep New Diesel Additions ===> 1 3000 2,150 6 ' 3000 2,150 n 2 000 2150 ¢ 2 3000 2,150 ¢ Net KW Plant sizes 1610 3 3000 2,150 3 woo 2,150 2150 4 3000 2,150 n 4 3000 2,150 3220 5 3000 2,150 n 5 3000 2,150 4300 6 3000 2,150 6 3000 2,150 Note: To assist In determining 7 300 2,150 7 3000 2,150 the timing of new resources, use 8 3000 2,150 8 300 2,150 macro <Alt>G, Then use macro 9 3000 2,150 9 3000-2150 <Alt>D to return to normal mode. 10 3000 2,150 10 30002,150 <Alt>T then transfers the Input section to the summary file Valdez Glenallen Unit Retire Year Unit Retire Year Existing Units ===> 1 3000 1 1989 2 3000 2 1989 3 3000 3 3000 4 3000 4 3000 5 3000 5 3000 6 3000 6 3000 iz 3000 7 3000 19-Jul-94 R.W. Beck Result: ASSUMPTIONS Copper Valley Electric Association - Sutton/Glennallen Interti Economic and Financial Options General Inflation ===> 0.0% Real Discount Rate 4.5% Real Interest Rate 1.5% HW Construction Inflator 4.2% CPI 1993/1992 3.2% (Blue Chip Indicator) Finance Cost ===> 0.0% Finance Life (in years) Diesel ===> 20 Hydro ===> 35 Intertie ===> 35 Proposed Coal ===> 30 Other ===> 0 Maximum Seasonal Plant Factor Existing Diesel ===> 35% New Diesel ===> 60% Base price of Fucl 1993 ($/gal) Valdez — Glen #2 Fuel Oil ===> 0.70 0.75 Hago ===> 0.68 0.73 Transmission Losses Intertie Availability Factor Valdez - Glennallen ===> 3.0% 0.98 Intertic ===> 9.7% Hours Per Season Winter 5832 (October - May) Summer ===> 2928 (June - September) 19-Jul-94 R.W. Beck Result:Pag Allison Lake Case Low Load; Low Fuel Replace Ex Diesel at OF Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertie Allison Lake New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacily Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) Glennallen Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) 19-Jul-94 I 4 x Copper Valley Electric Association - Sutlon/Glennallen Intertic Load and Resource Capacity Balance (KW) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 200 8,748 9,086 9,876 9,892 9,727, 9,559 9,566 9573 9580 9,575 9,561 9543 9,525 3,885 3,976 4,057 4,143 4,174,093 4,070 4,049 ° 4,029 4,001 3,974 3,948 3,922 12,633 13,063 13,933 14,035 13,844 13,651 13,637, 13,622, 13,609 13,576 13,534 13,491 13,448 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5,000 5,000 5,000 5,000 5,000 5,000 5,000 650) 6500 6500 6,500 6500 6,500 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3,067 3,067, 3,067, 3,067, 3,067 — 3,067 0 0 0 QO 2,150 2,150 = 2,150 2,150 2,150 2,150 2,150 2,150 2,150 0 0 0 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 9,750 9,750 9,750 9,750 4,050 8,050 4,050 4,050. 4,050 4,050 4,050 4,050 8,050. 6800 6,800 6,800 6,800 6,800 6,800 6800 6,800 6800680068006 8006800 21,550 21,550 = 21,550 = 23,700 = 24,150 24,150 24,150 = 28,717 28,717 28,717 28,717 28,717 28,717 8,748 9,086 9,876 9,892 9,727 9,559 —- 9,566 9,573 9580 9,575 9,561 9543 9,525 2,500 2,500 2,500) 2,500 2500 2,500 2500. 2,500) 2,500 2,500 2,500) 2,500 2,500 11,248 11,586 12,376 12,392 12,227 12,059 12,066 __12,073__12,080_12,075__12,061_12,043__ 12,025 14,750 14,750 14,750 14,750 15,200 15,200 15,200 19,767 __19,767__19,767__19,767__ 19,767 __19,767 3,502 3,164 92,374 2,358 = 2,973 3,141 3,134 7,694 7,687 = 7,692, 7,706 7,723 7,741 3,885 3,976 4,057 4,143 4,117 4,093 4,070 4,049 4,029 4,001 3,974 3,948 = 3,922 2500 2500 2,500 2500 2500 2,500 2,500 2500 2500 2500 2,500 2,500 2,500 6385 6476 _6557 6,643 6,617 _6593 6,570) 6,549 6,529 _6,501 6,474 6448 _ 6,422 6,800 6,800 6, 800_—8,950_ 895089508950 8,950 8,950 8,950 895089508950 415 324 243° «2,307. 2,333, 2,357 2,380 2,401 2,421 2449 2,476 2,502 2,528 R.W. Beck Result:Pag: Allison Lake Case Low Load; Low Fuel Replace Ex Diesel at OH Valdez Peak Demand Glennallen Peak Demand Total CVEA Demand Firm Capacity Conservation Valdez Conservation Glennallen Solomon Gulch Intertie Allison Lake New Diesel Valdez New Diesel Glennallen Existing Diesel Valdez Existing Diesel Glennallen Total Firm Capacity Valdez Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) Glennallen Peak Demand Reserves Total Capacity Requirements Local Resources Surplus /(Deficit) 19-Jul-94 Copper Valley Electric Association - Sutlon/Glennallen Intertic Load and Resource Capacity Balance (KW) 2006 2007 2008 2009 2010 2011 201 2013 2014 2015 2016 2017 2018 9507 9488 9,470 9,452 9,404 9,306 9,233 6,760 6,760 6,760 6,760 6,760 6,760 3,898 3,875 3,852 3,830 3,809 3,245 2,967 2,689 2,689 2,689 2,689 2,689 2,689 13,405 13,363 13,322 13,282 13,212 12,550 = 12,200 9Ad9 9,449 YA49 . 9,449 9,449 949 | 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 6500 6,500 6,500 0 0 0 0 0 0 0 0 0 0 0 0 0 3,067 3,067 3,067, 33,067, 3,067, 3,067, 3,067, 3,067 3,067, 3,067 = 3,067 3,067 3,067 2,150 2,150 2,150 2,150 2,190) 2,100 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 2,150 4,050 $,050 $,050. $,050 4,050 — 8,050 8,050 4,050 8,050 8,050 8,050 8,050 8,050 6,800 6,800 6,800 6,800 6800 6,800 6,800 6,800 6,800 6800 6,800. 6,800 6,800 28,717 28,717 28,717 28,717 28,717) 28,717. 28,717.) 28,717 28,717 28,717 28,717 28,717 28,717 9,507 9,488 9,470 9,452 9,404 9,306 9,233 6,760 6,760 6,760 6,760 6,760 6,760 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 12,007 11,988 11,970 11,952__11,904_ 11,806 _ 11,733 9,260 9,260 9,260 9,260 9,260 9,260_ 19,767. 19,767. 19,767 19,767__-19,767_ 19,767 19,767__19,767__19,767__19,767__19,767__ 19,767 19,767 7,760 7,778 7,797 7,815 7,863 7,961 8,034 10,506 10,506 10,506 10,506 10,506 10,506 3,898 3,875 3,852 3,830 3,809 3,245 2,967 2,689 2,689 2,689 2,689 2,689 2,689 2,500 2,500 2,500 2,500 2500 2,500 2,500 2,500 2,500 2,500 2,500 2,500: 2,500 6398 6375 6,352. 6,330 6309 _5,745 _5,467__—5,189 5,189 5,189 5,189 5,189 5,189 8,950 8,950 __ 8,950 _ 8,950 8,950 8,950 8,950 8,950 8,950 89508, 950__—8 950. 8,950, 2552 2,575 2,598 2,620 2,641 3,205 3483 3,761 3,761 3,761 3,761 3,761 3,761 R.W. Beck Result:Pag Allison Lake Case Low Load; Low Fuel Replace Ex Diesel at OF Valdez Energy Requirements Generation for Valdez Load Conservation Valdez Solomon Gulch Intertic Allison Lake New Diesel Valdez Existing Diesel Valdez Deficit Glennallen Energy Requirements Generation for Glennallen Load Conservation Glennallen Solomon Gulch Intertie Allison Lake New Diesel Glennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertie Allison Lake New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 = 2003 2004 2005 51,067 53,750 59,639 59,736 58,764 57,776 57,818 — 57,858 57,896 57,865 57,779 57,677 57,569 0 0 0 0 0 0 0 0 0 0 0 0 0 40,320 41,125 42,892 42,921 42,629 42,333 42,345 42,357 42,369 42,360 42,334 42,303 42,271 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 15,50) 15,527 15,506 15,445 15,374 15,298 0 0 0 0 10,494 10,528 = 10,527 0 0 0 0 0 0 10,747 12,625 16,747, 16,815 5,641 4,915__4,946 0 0 Q- 0 0 0 0 0 0° 0 0 0 0 0 0 0 0 0 0 20,484 20,554 20,540 = 20,583 20451 20,326 20,214 20,109 20,008 = 19,869 19,733 19,603 19,476 0 0 0 0 0) 0 0) 0 ) 0 0 (0) 0 6,145 6,166 6,162 6,175 6,135 6,098 — 6,064 6,033 6,002 5,961 5,920 5,881 5,843 0 0 0 0 0 0 ) 0 0 0 0 0 0 0 0 0 0 0 0 ) 10,878 10,852 10,873 10,932 11,001 11,074 0 0 0 11,300 11,300) 11,300) 11,300 3,198 3,153 3,035 2,881 2,721 2,559 14,339 14,388 14,378 3,107 3,016 2,928 2,850 ; 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 71,550 = 74,304 80,179 80,319 79,215 78,102 78,033 77,966 77,904 77,734 77,512 = 77,280 = 77,046 0 0 0 0 0 0 0 0) 0 0 0 0 0 46,655 47,482 49,244 49,287 48,954 48,619 48,597 48,576 48,557 48,504 48,437 48,366 48,294 0 0 0 0 0 0 0 Onn 0 0 0 0 0 0 0 0 0 0 0 0 26,715 26,715 26,715 26,715 26,715 26,715 0 0 Q 11,300 21,794 21,829 21,827 3,198 32159 3,035 2,881 2,721 2,559 25,085 27,013 31,125 19,923 8,656 7,843 7,796 0 0 0 0 0 0 190 191 191 191 190 189 188 523 521 521 521 522 523 71,550 74,304 80,179 80,319 79,215 __78,102__78,033__77,966_77,904_77,734_77,512__77,280_77,046 0 0 0 0 0 0 0 0 0 0 0 0 - O R.W. Beck Result:Page Allison Lake Case Low Load; Low Fucl Replace Ex Diesel at OF Valdez Energy Requirements Generation for Valdez Load Conservation Valdez Solomon Gulch Intertie Allison Lake New Diesel Valdez Existing Diesel Valdez Deficit Glennallen Energy Requirements Generation for Glennallen Load Conservation Glennallen Solomon Gulch Intertic Allison Lake New Diesel Glennallen Existing Diesel Glennallen Deficit CVEA System Requirements Total Generation for CVEA System Conservation Copper Valley Solomon Gulch Intertie Allison Lake New Diesel CVEA Existing Diesel CVEA Less Transmission Losses V-G Total Deficit 19-Jul-94 f F ie. t F f i 4 4 a t av ’ j Copper Valley Electric Association - Sutton/Glennallen Intertic Load and Resource Energy Balance (MWh) 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 201 57,459 57,349 57,240 57,133 56,846 56,235 55,791 35,791 35,791 35,791 35,791 35,791 35,791 0 0 0 0 0 0 0 0 0 0 0 0 0 42,238 42,205 42,172 42,140 42,054 41,871 41,737 35,737 35,737 35,737 35,737 35,737 35,737 0 0 0 0 0 0 0 0 0 0 0 0 0 15,221 15,145 15,068 14,993 14,792 14,365 14,054 53 53 53 53 53 53 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 mt) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 19,354 19,237, 19,123, 19,014 18,907 16,094 14,709 13,570 13,570 13,570 13,570 13,570 ‘13,570 0 0 me 0 0 0 0 0 0 0 0 0 ‘| 6 5,806 5,771 5,737, 5,704 5,672) 4A,B2K A AI3 4,071 4,071 4,071 4,071 4,071 4,071 0 0 0 0 0 0 0 0 0 0 0 0 0 11,149 11,224 11,297, 11,370 11,565 . 11,266 10,297 9499 9,499 9,499 9499 9,499 9,499 2,399 2,242 2,089 1,939 1,670 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 76,814 76,586 76,364 76,147 75,754 72,330 70,500 49,360 49,360 49,360 49,360 49,360 49,360 0 0 0 0 0 0 0 0 0 0 0 0 0 48,224 48,154 48,086 48,020 47,901 46,848 46,286 39,934 39,934 39,934 39,934 39,934 39,934 0 0 0 0 0 0 0 0 0 0 0 0 0 26,715 26,715 26,715 26,715 26,715 25,979 24,669 9,846 9,846 9,846 9,846 9,846 9,846 2,399 2,242 2,089 1,939 1,670 0 0 0 0 0 0 0 0 0 0 0 0 0 0 lo 0 0 0 0 0 0 524 526 527 528 533 498 455 420 420 420 420 420 420 76,814 76,586 _76,364__76,147__75,754__72,330) 70,500 49,360 49,360 49,360 __49,360_49,360__ 49,360 0 0 0 0 0 0 0 0 0 0 0 0 : 0 R.W. Beck Result:Pag Allison Lake Case Low Load; Low Fuel Replace Ex Diesel at O11 Diesel Costs Fuel Variable O&M Existing, Diesel] O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M z New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy Total Intertie Costs Allison Lake Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power 19-Jul-94 f b i Ri t t } ' t t { R. g i t i i t t } ! Copper Valley Electric Association - Sutton/Glennallen Intertic Economic Analysis (Constant 1993 Dollars 000) 1993-1994 19951996) 1997 1998 1999 2000 = 2001 = 2002, 2003, 2004200 $1,373 $1,484 = $1,730 $1,646 $1,539 $1,502 $1,506 $160 $159 $153 $146 $139 $131 780) 840 967 736 495 470 468 33 33 31 30) 28 27 0 0 0 0 0 0 0 (146) (146) (146) (146) = (146) ~— (146) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 26 26 26 26 26 26 26 26 26 26 0 0 0 102 204 204 204 204 204 204 204 204 204 $2,152 $2,324 $2,698 $2,510 $2,264 $2,202 $2,205 $278 $276 $269 $261 $252 $242 $0 $0 $0 ° $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 =$1,181 $1,181 $1,181 $1,181 $1,181 $1,181 0 0 0 0 0 0 0 1,039 1,024 1,010 997 984 971 $0 $0 $0 $0 $0 | $0 $0 =. $2,220 $2,206 $2,192 $2,178 $2,165 $2,152 $2,152 $2,324 $2,698 $2,5 10 $2,264 $2,202 $2,205 $2,498 $2,482 $2,461 $2,439 $2,417 $2,395 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,152 $2,324 $2,698 $2,510 $2,264 $2,202 $2,205 $2,498 $2,482 $2,461 $2,439 $2,417 $2,395 Present Value in 1993 dollars (Discounted @4.5%) Cumulative (1993 - 2018) $35,242 (in thousands) 30 Year (2019 - 2048) with no additional growth 10,928 (in thousands) Total Net Present Value . $46,169 (in thousands) R.W. Beck Result:Pa; Allison Lake Case Low Load; Low Fuel Replace Ex Diesel at OF Diesel Costs Fuel Variable O&M Existing Diesel O&M Adjustment Additional Building and Equipment New Diesel Fixed O&M New Diesel Capital Costs Total Diesel Costs Total Conservation Cost Intertie Cost Annual Carrying Charge Annual O&M Costs Economy Energy ‘Total Intertie Costs Allison Lake Annual Carrying Charge Annual O&M Costs Total Other Costs Total Cost of Power Sale of Surplus Solomon Gulch Energy Surplus Energy Revenues from Sale District Heat Net Revenue(Coal Case) Net Annual Cost of Power 19-Jul-94 HE ME 9 ROR LL Rol: @ A a 3 3 ue 4 ee eb a i ’, ; Copper Valley Electric Association - Sutton/Glennallen Intertie Economic Analysis (Constant 1993 Dollars 000) 2006 = =2007, 2008 =. 2009 20102011 2012. 2013, 2014201 2016 = 2017 2018 $123, $116 $108 $101 $87 $0 $0 $0 $0 $0 $0 $0 $0 25 23 22 20 17 0 0 0 0 0 0 0 0 (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) (146) 0 0 ~ 0 0 0 0 0 0 0 0 0 0 0 26 26 26 26 26 26 26 26 26 26 26 26 26 204 204 204 204 204 204 204 204 204 204 2041 204 204 $233 $224 $215 $206 $189 $85 $85 $85 $85 $85 $85 $85 $85 $0 $0 $0 - $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0. $0 $0 $0 $0 $0 $0 $0 $0 $0 0 0 0 0 0 0 0 0 0° 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 $1,181 959 _947 936 925 914 904 94 88S. 875 866 858 849 841 $2,140 $2,128 $2,117 $2,106 $2,095 $2,085 = $2,075 $2,066 $2,056 $2,047 $2,039 $2,030 $2,022 $2,373 $2,352 $2,332 $2,312 $2,285 $2,170 $2,160 $2,150 $2,141 $2,132 $2,123 $2,115 $2,107 0 0 0 0 0 0 0 0 0 0 0 0 0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,373 $2,352 $2,332 $2,312 $2,285 $2,170 $2,160 $2,150 $2,141 $2,132 $2,123 $2,115 $2,107 R.W. Beck Result:Pay fn Pa tom ASSUMPHONS Run Descriptions Gulch Winter Gen 21,000 MWh ===> Run Options (l«yes; 0=no) Conservation Intertie Allison Lake Silver Lake Coal Facility Other Load Forecast (11M,1.) ==> Fuel Price (XILILL) ===> Hydro Conditions (A,1) aee> £ 3 Adjustment to Existing Diesel O&M Labor Costs for Alternative Usage Levels Standby ===> Basel.oad «==> % Solar Turbine =ee> Purchase Price of Intertie Energy Economy 1 ===> Economy 2 ===> New Diesel Additions ===> Net KW Plant sizes 1610 2150 3220 4300 Note: To assist In determining the timing of new resources, use macro <Alt>G. Then use macro <Alt>D to return to normal mode. <AltoT then transfers the input section to the summary file Existing Units aae> & g. ; ie t u i Pann! 2 Fb be Bemis Copper Valley Electric Association - Sutton/Glennallen Intertie Allison Lake Case Low Load; Low Fuel Replace Lx Diesel at Ol! Include Yr Onlin Location 0 1994 Hoth 0 1999 Glennallen Nov 1, 1997 | 2000 Valdez 0 2001 Valdez Option ===> b 0 1998 Vaklez 0 1997 Vaktez ' 1 1 a Savings Allison Lake Year ($)000) Intertie Silver Lake and Coal 200 145.5 560 145.5 3000 291050 2550 500-2050 Station Us 5% Valdez Gen All Bid Only No Bid 3.6% Select 500 3000) Jeyden 1 Esthnate of economy energy fuel costs only 0 Includes estimate of fixed related costs Vaklez Glenallen Unit Year Cap(K New/Re Unit Year Cap(K New/Rep 1 1997 2,150 & 1 1996 2,150 n 2 3000 2,150 6 2 3000 2,150 & 3 3000 2,150 6 3 3000 2,150 n 4 3000 2,150 4 3000 2,150 5 3000 2,150 5 3000 2,150 6 3000 2,150 6 3000 2,150 7 300 2,150 7 3000 = 2,150 8 3000 2,150 8 3000 2,150 9 3000 2,150 9 3000 2,150 10 3000 2,150 10 3000 2,150 Valdez Glenallen Unit’ Retire Year Unit Retire Year 1 3000 1 1989 2 3000 2 1989 3 3000 3 000 4 1997 4 3000 5 3000 5 3000 6 3000 6 3000 7 3000 Z 3000 RW. Beck 19-Jul-94 Result: ASSUMPTIONS Economic and Financial Options General Inflation * Real Discount Rate Real Interest Rate HW Construction Inflator = ===> CPI 1993/1992 =as> Finance Cost ===> Finance Life (in years) Diesel ===> Hydro ===> Intertic => Proposed Coal > Other => Maximum Seasonal Plant Factor Existing Diesel ===> New Diesel ===> Base price of Fucl 1993 ($/gal) #2 Fuel Oil ===> Hago ===> Transmission Losses Valdez - Glennallen z=ae> Intertie => Hours Per Season Winter ===> Summer ===> 19-Jul-94 Copper Valley Electric Association - Sutton/Glennallen Interti 0.0% | 4.5% 1.5% 4.2% 3.2% (Blue Chip Indicator) 0.0% 20 35 35 | 30 : 0 35% 60% Valdez = Glen 0.70 0.75 0.68 0.73 Intertie Availability Factor 3.0% 0.98 9.7% 5832 (October - May) 2928 (June - September) R.W. Beck Result:Pag SRUCCACALALEC ALE A Conceptual Proposal to Alyeska Pipeline Service Company, Inc. Marine Terminal Valdez, Alaska Presented by: Clayton Hurless, General Manager Copper Valley Electric Association, Inc. P.O. Box 45 Glennallen, Alaska 99588 Proudly serving our member/owners since 1959 COPPER VALLEY ELECTRIC ASSOCIATION, INC. CONCEPTUAL PROPOSAL TO ALYESKA PIPELINE SERVICE COMPANY VALDEZ MARINE TERMINAL VALDEZ, ALASKA JULY 1994 PREFACE Alyeska Pipeline Service Company (Alyeska) and Copper Valley Electric Association, Inc. (CVEA) have participated in a number of discussions over the years relative to interconnecting electrical systems to provide increased reliability and economy of operations for both companies. Current circumstances at both Alyeska and CVEA appear to provide the opportunity to productively pursue this concept once again. Alyeska is in the final planning process for the installation of a hard piping vapor recovery system. The system, when installed and operating, will produce a significant quantity of flammable vapors suitable as a fuel source for its existing power generation system. Alyeska has three 12 1/2 mw oil-fired steam turbines. Its current operations mode is to operate two of the turbines simultaneously to serve a load of approximately 7 to 8 mw. Two turbines are operated to obtain the required system reliability. At this level of operation, the turbines perform on the low end of the power efficiency curve. Additional power could be produced by the two operating units and unit cost reduction achieved through a greater degree of efficiency. Potentially, the interconnection of Alyeska and CVEA's power systems could facilitate sales of some excess power to CVEA to the benefit of both parties. CVEA operates three generating plants consisting of the 12 mw Solomon Gulch (SG) hydro plant and two diesel plants. SG is, owned by the State of Alaska and operated by CVEA under a contract that expires in 2030 and requires CVEA to purchase all of the output of SG up to its load requirements. The estimated average annual energy output of SG, running at full nameplate rated capacity when adequate water is available, is approximately 52 million kwh. The SG watershed has historically produced enough water to provide for all of CVEA's requirements from mid to late May until late September to mid October. CVEA currently pays 6.6¢ per kwh for power produced at SG. The power required in addition to SG production is supplied by the two diesel generating plants. For purposes of identification, that power is referred to as the "supplemental requirement.” CVEA will generate approximately 30 million kwh with the diesel plants in 1994 to provide for the CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 2 supplemental requirement. CVEA's load is expected to peak between 11.5 and 12.0 mw in 1994. This will require supplementing SG production during the summer months for the first time. This factor will cause all future load growth to be provided by supplemental resources. The largest of CVEA’s diesel plants is the 10 mw Valdez plant, comprised of six reciprocating engines and one 2.8 mw combustion turbine. The second diesel plant is the 6 mw Glennallen plant, which is made up of seven reciprocating engines. With the exception of two small units at the Glennallen plant, all of the units are maintained in good to excellent condition. The diesel generating units were installed from the late 1950's to 1975. The units are operating reliably but at continually increasing cost as parts become harder to obtain and more expensive. CVEA has a total installed capacity of 28 mw when SG can be operated at full capacity and 16 mw when SG is not available. Prudent utility operating practice suggests reserves should be maintained equal to 30-40% of required capacity. This would reduce the total system capacity available to serve a load to 16.8 mw when SG is available and 9.6 mw when SG is not available. The stated availability of capacity is very conservative and should be considered an extreme worst case scenario for two reasons. First, it assumes SG is down completely, which in fact is rarely ever the case, unless for a very short period for planned maintenance. The reliability of hydro generators is extremely high, and even in low water periods, some production is available from SG. Secondly, SG in the October-to-May period has essentially unlimited flexibility for planning operations and scheduling to achieve the best reliability from the total generating resource base. For the past two years, CVEA has been involved in a detailed study of a 135-mile, 138 kv intertie line that will connect CVEA to the integrated Railbelt Generation and Transmission System (RGTS). This project is essential to the long-term future of CVEA's service area and is the critical first step in establishing some degree of parity in electric rates between CVEA's consumers and the majority of consumers in the rest of the state. In 1993 CVEA residential consumers paid 20.6¢ and 16.9¢ per kwh in the Copper Basin and Valdez respectively. The project achieved a major milestone on July 5, 1994, when Commissioner Edgar Blatchford of the Department of Community and Regional Affairs (DCRA) approved a $35 million, 50-year, zero-interest loan to provide the primary funding of the line. The line is expected to be ready for energization by January 1, 1999. The intertie line will have an initial transfer capacity of approximately 15 to 18 mw. The capacity of the line can readily be expanded to 40 mw by the addition of Static Var Systems if load growth requires and justifies the expansion. The integrated RGTS has a large amount of surplus power available, on the order of 500 mw. This surplus is expected to provide for the load growth requirements of all of the RGTS member utilities into the foreseeable future and still have a significant amount available for sales to new customers. CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 3 This factor will not only assure the availability of supply but will also provide a degree of price stability due to the embedded capital base being manifested in old dollars. Chugach Electric Association (Chugach), in its latest financial forecast, has projected that prices in real terms will actually decrease marginally in the next 20 years. Chugach is one of the two probable power suppliers for CVEA. N INI CVEA is of the understanding that Alyeska is conducting a comprehensive study of options that would facilitate reducing its cost of power production by utilizing one of the following alternatives: iM Selling CVEA its supplemental power requirements, which would allow Alyeska’s generation system to operate more efficiently. 2. Leasing or selling its power generation facilities to another entity who would sell power to Alyeska and possibly to CVEA. Sf Purchasing power from CVEA that would be delivered via the Sutton to Glennallen and Glennallen to Valdez interties. 4. Selling power to CVEA in the interim until the intertie is constructed, then Alyeska purchasing power from CVEA. CVEA’S DISCUSSION OF ALTERNATIVE THREE Alternative three is the only option that CVEA is prepared to respond to at this time . Options one and two would require a proposal originating with Alyeska or its contractor to CVEA. Regarding alternative four, CVEA would willingly enter into discussions relative to operating Alyeska’s power generation station or, in the alternative, purchasing power from Alyeska in the interim period between now and when the transmission line is available for service in 1999. CVEA has only a cursory understanding of the electrical characteristics and shape of Alyeska's load which will require a detailed scoping of option three prior to CVEA making a firm commitment. CVEA believes there has been enough information developed on an Alyeska/CVEA interconnection in the past few years to provide the basis for a conceptual proposal. This proposal can be extended into a comprehensive firm proposal if it appears to have sufficient merit for both entities to justify the cost of preparing such a final document. CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 4 Alyeska Terminal Manager Bill Newbold and Operations Manager Steve Jones met with CVEA's General Manager Clayton Hurless, Manager of Engineering Services Mike Easley, and Manager of Administration and Finance Robert Wilkinson in late October 1993. The general parameters of a power sales and/or purchase agreement between Alyeska and CVEA were discussed. CVEA agreed to compile certain information relative to the reliability, the legal and economic viability of a transaction of this type. CVEA transmitted certain information on reliability and legal findings to Alyeska on January 17, 1994 (Attachment 1). In the letter of transmittal, CVEA stated that the economic information was not available pending completion of the feasibility study and further discussions with potential wholesale power suppliers. Alyeska and CVEA met again on July 13, 1994, precipitated by a resolution passed by the Valdez City Council, to discuss the possibility of an arrangement between Alyeska and CVEA that could potentially reduce retail rates for CVEA's consumers in the Valdez district (Attachment 2). (Note: as a member-owned cooperative, CVEA would only be interested in an arrangement which would be beneficial to all of its member-owners including those in the Copper River Basin.) Mr. Newbold reiterated the three primary concerns of reliability, legality, and economics. He requested CVEA prepare an unsolicited proposal for Alyeska's consideration. Mr. Newbold stated that Alyeska's long-term objective is to get out of the power generation business, and any proposal which would accomplish that goal with a favorable economic impact would be considered. He stated that an arrangement whereby CVEA operated Alyeska's power generation facilities until the intertie is available would be considered a viable proposal. DISCUSSION OF THE THREE PRIMARY ISSUES Reliability The reliability issue is primarily manifested in two major concerns. The first is the reliability of the transmission line during the avalanche season when the Glennallen to Valdez line is subject to relatively high exposure of avalanche damage. The second issue is the reliability of the backup generation plant if, in fact, a transmission line outage is experienced. The issue of transmission line reliability has two major components: the potential frequency and length of an outage, and the average length of the avalanche season. Transmission lines are a very reliable part of a utility’s power system when operating in a normal environment. Even when operating in the extremes of the arctic environment, they achieve an enviable record of reliability. Technology in constructing and maintaining structures in the CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 5 permafrost areas has advanced significantly in the past few years, as has the protection of structures from avalanche damage. As the load increases and the reliance on a transmission line grows, additional protective measures could become economically justified. The proposed new intertie line from Sutton to Glennallen will have a very small chance of being damaged by an avalanche. The majority of the line will be located in the flat areas of the Matanuska Valley, well away from avalanche slopes, and through the broad expanse of the Copper Basin, with no chance of an avalanche. For approximately 15 to 20 miles where the line will cross through the Talkeetna Mountain range, it will be routed away from any known or potential avalanche prone slopes. The Glennallen to Valdez section has a number of potential avalanche areas, with the Thompson Pass area being the most significant because of the high snowfall and high winds. The length of the avalanche season is essentially contained in the five-month period of December through April. The peak season would occur in the December through March period and then diminish as the snow melts and packs in the spring. This line segment has experienced two outages as a result of avalanche damage since being energized in 1982. The most severe outage occurred in the winter of 1988 and caused the line to be out of service for several months. The other outage was at Mile 54 of the Richardson Highway and was only a few days in length. Reliability of transmission facilities must also be considered from the perspective of available backup. Assuming an interconnection of Alyeska’s and CVEA's electrical systems, a total of 59 mw of generation located at Valdez would be available to serve a combined load of less than 20 mw. Assuming that the SG reservoir is maintained at a full or near full level as an insurance policy against transmission line failure and with the addition of the 2.8 mw turbine, CVEA would have approximately 16 mw of instantaneous capacity available to pick up critical loads (hydro facilities can be operated 10% over rated capacity without damage). Assuming that the reciprocating engines are in a condition of warm standby and depending on the ambient temperature at the time, CVEA would have an additional 7+ mw of capacity available within 48 hours. It is possible that a final generating resource management plan may determine it would be economically justifiable to maintain the Valdez diesel plant in hot standby condition during the peak avalanche season, particularly in a heavy snow year, if CVEA were serving the Alyeska load. As a result of the October 1993 Alyeska/CVEA meeting, CVEA retained POWER Engineers, Inc. (PEI) to prepare a brief study of the technical aspects of interconnection between the two systems that could compromise the reliability of either system. PEI had in the relatively recent past conducted an assessment of the Alyeska power system, which provided them the basic database to assess what technical problems, if any, would be encountered by an interconnection. The study did CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 6 not find any technical problems, such as large motor in-rush starting current, that could not be mitigated in a reasonably economic way. A copy of that study is enclosed with this proposal (Attachment 3). Summary of Reliability A transmission line that is properly constructed and maintained, even in the arctic environment, is a highly reliable facility. The scheduling flexibility that could be achieved from the integration of the variety and total capacity of backup resources resulting from an Alyeska/CVEA interconnection indicates that a resource dispatch plan could be formulated to achieve a highly reliable system. As stated above, some mitigation of motor starting currents, etc., would have to occur on the Alyeska system for it to operate acceptably when interconnected to the CVEA system. Everything considered, there is every reason to believe that an interconnected system would provide for a highly reliable and cost efficient system to the benefit of both Alyeska and CVEA. Legal Considerations Throughout the discussions over the past three years with Alyeska, one of the primary concerns Alyeska has expressed is what effect, if any, an interconnection would have on its regulated status. To answer that question, CVEA asked General Counsel Richard Huffman of the law firm of Kemppel, Huffman & Ginder to research the regulatory aspects of an interconnection between the two systems. Mr. Huffman, whose firm deals primarily in utility and regulatory law, found no reason to believe that an interconnection would cause any change in the regulatory status of either party. A copy of that opinion is included as Attachment 4. Mr. Huffman can be available to discuss this aspect of the proposal if requested by Alyeska. Economic Consideration CVEA is still not able to provide a firm economic proposal to Alyeska. Enough progress has been made, however, in defining potential power supply options since our last communication that we can be more confident of our ability to propose a range of power cost for Alyeska's consideration. First and foremost, Commissioner Blatchford's decision on July 5 instills a much greater degree of certainty that the Sutton to Glennallen intertie line will become a reality. Admittedly, there are obstacles remaining, but the fact that the State financing is essentially assured is a major milestone in the project’s history. CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 7 CVEA has received two conceptual power supply proposals, one from Chugach and the other from Anchorage Municipal Light & Power (ML&P). Chugach proposes that CVEA be folded into the integrated RGTS and that CVEA purchase firm power in accordance with Chugach’s approved tariff. Their proposal would deliver power to CVEA at the same rate and under the same terms and conditions as other wholesale utility customers with similar characteristics. For purposes of identification, this is called the "integrated case.” The basic aspect of this approach is that all debt service, operations and maintenance costs, and transmission losses would be blended into the total cost of operating the RGTS. ML&P's proposal is based on CVEA leasing capacity in one of their existing generating units and purchasing quasi-firm energy. All the costs of debt service, operations and maintenance costs, and transmission losses would be to the account of CVEA. This approach suggests that CVEA would be better off owning the line and relying on the availability of firm power at a competitive cost in the future. For purposes of identification, this proposal is called the "nonintegrated case.” CVEA has completed a comprehensive study of the two proposals based on information developed in the recently completed Sutton to Glennallen Intertie Feasibility Study (the study) conducted by R. W. Beck & Associates of Seattle, Washington, under the direction of the Division of Energy of DCRA. Using the medium load forecast projections from the study, the Chugach proposal appears to be superior to the ML&P proposal for the first 15 to 17 years. The two proposals then appear to be roughly equal for the next few years. Load growth projections are a very important factor in assessing potential transmission power supply alternatives. With the exception of the cost of purchased power and losses, the costs of owning and operating a transmission system are primarily fixed, i.e., interest, depreciation, maintenance and operation costs are constant regardless of the number of units of power transported over the line. Given the fixed costs, it follows that the more units transported, the less the unit cost of delivery. In the medium load growth case, the study projects that in the year 2001 CVEA will require approximately 39,000 mwh of supplemental power. The information we have available indicates Alyeska currently requires approximately 50,000 mwh annually. Mr. Newbold has stated that the vapor recovery system will increase Alyeska's requirement substantially, possibly in the range of 3 to 4 mw. Essentially, all of the power required to serve the Alyeska load would be transported over the intertie because SG currently is nearing its full production capability. CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 8 The study projects in the year 2001 the total annual cost of owning and operating the line, less power cost, will be $2,242,000 (Attachment 5.26). Disregarding the additional power required for the vapor recovery system, the addition of the existing Alyeska load would reduce the unit transportation cost from 5.75¢ per kwh to 2.52¢ per kwh. The addition of another 3 mw average, or 26.000 mwh annually, would further reduce the transportation cost to 1.95¢ per kwh. This example emphasizes the importance of future load growth on selecting one of the two power supply proposals. CVEA has recently developed information to establish our avoided cost of power in a nonrelated case that is pending before the Alaska Public Utilities Commission (APUC). A copy of the prefiled testimony of Mr. Wilkinson was provided to Mr. Newbold and Mr. Jones at the previously referenced meeting on July 13 (Attachment 5). The testimony includes all of the assumptions used to calculate the estimated cost of power subsequent to the availability of the transmission line. Those calculations, again based on a 2001 projected requirement of 39,000 mwh, indicate a cost of power delivered to Glennallen in the integrated case of 6.1¢ per kwh (Attachment 5.5) compared to 9.5¢ per kwh (Attachment 5.7) in the nonintegrated case. The addition of the Alyeska load would not change the cost of the integrated case but would reduce the unit cost in the nonintegrated case to 6.32¢ per kwh. Adding another 26,000 mwh would further reduce the nonintegrated cost to 5.75¢ per kwh. When compared to CVEA's historical average cost of diesel generation over a four period of 15¢ per kwh, the potential savings are significant. In addition to the delivered cost of power stated in the preceding paragraph, CVEA has residual and emergency standby costs associated with the existing diesel plants that total $730,000 (Attachment 5.26) annually (in 2001). Approximately 50% of this cost is the depreciation and interest on the unamortized balance of the diesel plants, and the remaining 50% is standby labor and O&M on the plants in the event they are needed in an emergency. The depreciation and interest on the existing plants will be paid out by 2008, after which the only cost of power other than purchases from SG and the RGTS will be standby labor and O&M on the diesel plants. Again, based on the load projection of 39,000 mwh supplemental requirement in 2001, the residual cost represents a unit cost of 1.9¢ per kwh. If Alyeska's base load were included, the residual cost would decline to .8¢ per kwh, and if an additional 26,000 mwh associated with the vapor recovery system are added, it would further decline to .6¢ per kwh. CVEA's total cost of power is the weighted-average blend of the cost of SG power and supplemental power currently generated with the diesels. In the last few years, the amount of SG power has declined as a percentage from about 80% of the total requirement to the current 60%. Concurrently, the amount of diesel-generated power has increased from approximately 20% to 40%. The purchase rate for Solomon Gulch power is set by the Project Management Committee of CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 9 the Four Dam Pool operating group and is currently 6.6¢ per kwh. As stated above, the cost of diesel-generated power over the preceding four-year period has averaged approximately 15¢ per kwh. The average cost of the total power requirement has been 10¢ per kwh plus or minus a couple of mills over the same four-year period. Attachment 6 illustrates the cost of power in 2001 for the integrated and nonintegrated cases assuming various load scenarios. Costs presented exclude the costs associated with interconnection between Alyeska and CVEA which would presumably be negotiated in a Line Extension Agreement. Blending the cost of power subsequent to the availability of the intertie would produce a total system average cost of power of 7.48¢ per kwh in 2001. Adding Alyeska's base load would decrease the total system average cost of power to 6.99¢ per kwh. Assuming the additional 26,000 mwh were to be served, the total system average cost of power would decline further to 6.85¢ per kwh. Applying the same logic to the nonintegrated case would produce the following approximate result. Again, based on the study, the total system average cost of power would decline to 8.96¢ per kwh in 2001. Adding the Alyeska base load would decrease the average cost to 7.13¢ per kwh, and adding the vapor recovery system load would cause a further decline to 6.61¢ per kwh. It becomes clear from the above calculations that the economies of scale are a significant factor in assessing a power supply alternative. The integrated case achieves an approximate 20% better result than the nonintegrated case in the lower load growth scenarios. Adding the Alyeska base load results in the integrated and nonintegrated cases becoming essentially equal, and if the vapor recovery load is added, the nonintegrated case achieves a 6% better result than the integrated case. To complete a power cost calculation that would arrive at a total final cost to Alyeska would require a cost of service analysis. All of the other cost categories associated with the delivery of power, i.e., administrative, maintenance, operation, wheeling from Glennallen to Valdez, etc., would be assessed on a cost causer, cost payer basis. CVEA's total annual dollar expenditure for each of these cost categories is essentially task oriented and would not be significantly affected by the addition of the Alyeska load. Some of the cost categories, such as existing distribution maintenance and operations expense, would not be applicable to the Alyeska rate. Other cost centers, such as customers’ costs, are allocable on a weighted per customer basis and would have very little effect on the Alyeska rate. Administrative and general (A&G) costs would be reallocated proportionately to all consumers, including Alyeska. A&G costs for 1994 total less than $1,000,000 which, when divided by the total potential kwh sales including Alyeska, would amount to approximately .6¢ per kwh. CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 10 Margins, or patronage capital (gross dollars above cost of service), are a factor that will require considerable discussion and analysis. Cooperative associations, such as CVEA, assign the margins (capital credits) using an allocation method tied in some form to electric revenues. There have been a number of problems arise across the U.S. when large industrial accounts accumulated large amounts of patronage capital credits in cooperatives but, for a variety of reasons, were unable to retire capital credits. Cooperative utilities have employed a variety of methods to mitigate the above-referenced problem. Possibly the most successful method used is an agreement whereby the cooperative excludes margins from the negotiated rate. This in essence would provide service to Alyeska at cost. The rate would contain a very small amount to cover contingencies for variations in the cost of service resulting from changing circumstances. In return for this consideration, Alyeska would agree to waive any capital credit entitlements. Given CVEA is regulated by the APUC, such an agreement would require APUC approval. ~ While it is not possible to quote an absolutely firm rate for service to Alyeska, a range can be established for consideration. CVEA has assumed that the base case would be comprised of Alyeska's base load of approximately 50,000 mwh annually, plus a requirement of 39,000 mwh of supplemental power for CVEA’s other consumers. In both the integrated case and the nonintegrated case, CVEA's cost of power is essentially the same, 6.99¢ and 7.13¢ per kwh respectively. A reasonable range of all other costs would be from 1.4¢ to 2.0¢ per kwh. This would indicate a total cost of power to Alyeska between 8.4¢ and 9.1¢ per kwh. SUMMARY AND CONCLUSIONS The addition of the Alyeska load to CVEA’s current load when the intertie becomes available would have a very beneficial impact on CVEA's other rate payers by spreading the fixed cost of operating the new intertie line over a larger number of units, thereby significantly reducing the unit cost to everyone. While CVEA does not know Alyeska's cost of power generation, when we compare the projected cost of power purchased from the RGTS over the intertie to the known historical cost of CVEA's diesel generation, significant savings are evident. CVEA is of the opinion that there are no technical, legal, or economic problems that would be encountered in the negotiation of a power sales and purchase agreement between Alyeska and CVEA that could not be mitigated to a successful conclusion to the benefit of both parties. CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 11 The final conclusion reached is that all of the information and calculations indicate the strong possibility of the potential to create a true win-win situation by reducing the cost of power for both Alyeska and CVEA's member-owners. For additional information relative to this conceptual proposal, please contact: Clayton Hurless, General Manager Copper Valley Electric Association, Inc. P. O. Box 45 Glennallen, Alaska 99588 Telephone: 907-822-3211 Fax: 907-822-5586 i ’ ? CVEA Conceptual Proposal Alyeska-Valdez Marine Terminal Page 12 N lo a ATTACHMENTS January 17, 1994, letter from CVEA to Mr. Bill Newbold, Manager, Alyeska Pipeline Terminal City Council of the City of Valdez, Alaska, Resolution No. 94-62 POWER Engineers “CVEA-Alyeska Service Reliability Study,” December 1993 Legal opinion from CVEA’s General Counsel Richard Huffman “Supplemental Prefiled Testimony of Robert Wilkinson on Behalf of Copper Valley Electric Association” Weighted Average Costs vy Attachment 1 eee P.O. BOX 45 GLENNALLEN. ALASKA 99588-0045 Glennallen (907) 822-3211 - Valdez (907) 835-4301 Telefax # (907) 822-5556 January 17, 1994 Mr. Bill Newbold, Manager Alyeska Pipeline Terminal P.O. Box 300 MS/700 Valdez, Alaska 99686 Subject: Alyeska Terminal Service Dear Bill: I have been remiss in not communicating with you sooner on the progress of our investigation into the possibility of providing the Terminal with commercial power that would be obtained from the Railbelt interconnected system. The power would be available if we are successful in constructing the proposed Sutton to Glennallen transmission line. We have received an opinion from CVEA’s Counsel that doesn’t find any legal reason to believe that a power sales and purchase agreement between Alyeska and CVEA would change the regulated status of either party. I am enclosing a copy for your review. Also enclosed is a copy of a letter from the APUC referencing this subject and the State statutes which address this. We have also recently received the study from POWER Engineers regarding the electrical characteristics of an interconnection. Some mitigative measures would have to be taken to permit the starting of the large vapor recovery motors. The report concludes that there are not any problems that cannot be solved in a relatively economical manner. I have also enclosed a copy of this report for your review. Further study may be desirable if all other aspects of purchasing power from CVEA are acceptable to Alyeska. We are continuing to work on the economics of providing service to the Terminal. At this point, we are reluctant to estimate the delivered cost of power because of the uncertainty of our power supply arrangements. We are continuing - SERVING MEMBER-OWNERS IN THE COPPER RIVER BASIN AND VALDEZ Attachment 1.1 COPPER VALLEY ELECTRIC ASSOCIATION, INC. Mr. Bill Newbold January 17, 1994 Page 2 to negotiate with potential suppliers and should be able to reach some definition of approximate power cost in the relatively near future. We will provide this information as soon as possible. Thank you for your interest. Your favorable consideration to purchase power from CVEA would have a very positive effect on the operation of the intertie. We are encouraged at this time that a mutually benefical agreement can be achieved. Please feel free to call me if you have any questions or comments. Yours truly, Caffeine’ H Clayton Hurless General Manager Enclosures c:\wp\cdh\94-005.jw Attachment 1.2 Attachment 2 CITY OF VALDEZ, ALASKA RESOLUTION NO. 94-62 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF VALDEZ, ALASKA, ENCOURAGING ALYESKA PIPELINE SERVICE COMPANY, COPPER VALLEY ELECTRIC ASSOCIATION, AND EPA TO EXPLORE WAYS TO PRODUCE ECONOMICAL ELECTRICAL ENERGY FROM PRESENT AND FUTURE OPERATIONS OF THE TRANS ALASKA PIPELINE. WHEREAS, the City of Valdez has one of the highest priced un- subsidized electricity rates in the State of Alaska; and WHEREAS, the City of Valdez is committed to reducing the electric rates for our residents, and business, and to encourage new industry to locate in Valdez; and WHEREAS, Copper Valley Electric is interested in alternate sources of energy that are competitively priced; and WHEREAS, Alyeska will be required under the Clean Air Act, to reduce vapors emitted during the loading of tankers; and WHEREAS, the incineration of vapors could produce power for Copper Valley Electric Association; and WHEREAS, the Valdez Marine Terminal currently produces power in excess of it's operational needs; and WHEREAS, the Valdez Marine Terminal is currently not interconnected with the CVEA electrical grid; and WHEREAS, the pipeline was designed with a pressure reducing turbine to produce electricity that was never installed; and WHEREAS, the electrical intertie could supply needed power and distribute excess power to the rail belt energy grid. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF VALDEZ, ALASKA, that The City of Valdez encourages Alyeska Pipeline Service Company, Copper Valley Electric, and EPA to work together to explore using the energy that is currently generated or that can be generated in the future to produce economical electrical power for the citizens of Valdez and Copper Valley Electric. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF VALDEZ, ALASKA, this sh day of July, 1994. CITY OF VALDEZ, ALASKA ae Joyxn L. Harris, Mayor Attachment 2 Attachment 3 ee ee POWER (Us MENGINEERS Document No: 126017-01 Copy No: 24 Issued To: _CVEA— CVEA - ALYESKA SERVICE RELIABILITY STUDY DECEMBER 1993 For More Information Regarding This Document Contact: « Don Angell, P.E. ¢ John McGrew = 3940 GLENBROOK DRIVE P.O. BOX 1066 HAILEY, IDAHO 83333 (208) 788-3456 pul aneeoT ttachment TABLE OF CONTENTS ADABICE OF) CONTENTS trreserreresacssececserccsetecesnseversesorevcsaceuarcussnstecusessesensesraccrsruscacraees i INTRODUCTION etre sere cerca rern cence ee cee eet ata ne nceanncrnetaascanctcunconsaseesucssvstronseseesaes 1 SUMMARY OF FINDINGS .........ssessessecesseseeeees a eetaaraaniertasahanssvanseneeserasrssertsesaseeaers 3 CONGIEUSTIONS Weteraecerasrestassrareatentenrarteraruarancutetennesteresserssrsrsensraricesteseseuse srestsesronsensess 6 RECOMMENDATIONS terete see eee eee a Eee rare eer tenternerteres 7 PAINUA TOY, SIS ore ee crascesaersnasnersbacactelssacnsats suoncusrteetscrontaresactcereekactorelncusacasasscasbocensactetsea 8 Railbelt Resources/load|ttsersrecsrarsevenseverecnersersveesonsnscestevsrersecassesersvansectensecvesses 8 VELA Rieonsr cesT caedesv os saesttaog hcp etrepvonedu tals eidlel sap Stee aetogre 9 Alyeska Resources/Load.......sssccsssssssssssssseessnseeesneeesnneeengnesessnecsansecsnetsnseesoass 13 RailbettiReliabilitymencrercssrcesete re ere ee a ee 16 CVEA'Refiability teaser ree ee 17 Alveska' Reliability sem ccs ee 19 Power Delivery PT OVAL VeSkca tet ccce space ere aera aera tanta ot tata ener ee set arteneendeeee 20 Short: Gircutt(Currentimecrecccrccer cree eee eels 24 IMOtOn/ Starting veresce tesserae tee ca tee ea Pelee el aa ela el ea eee 24 Attachment 3 1 INTRODUCTION Copper Valley Electric Association (CVEA) has requested that POWER Engineers, Inc. (POWER) investigate the feasibility of CVEA providing power from the Anchorage Railbelt electric system to Alyeska's Valdez Terminal (Terminal) facility. This report contains POWER's assessment of the technical feasibility of CVEA serving the Alyeska Terminal. CVEA serves the cities and surrounding areas of Glennallen and Valdez, Alaska with a stand-alone power system, not interconnected to any other power system, consisting of diesel and hydro electric generation, a 138kV transmission system™connecting the two cities, and a distribution system. The hydro electric generation facility termed Solomon Gulch Hydro (Solomon hydro) and the 138kV transmission line interconnecting Glennallen and Valdez are owned by the State of Alaska and operated by CVEA under a long term contract by with the State. CVEA is pursuing an interconnection to the Anchorage Railbelt system for the purpose of obtaining power to replace diesel generated power. The interconnection will be via a new 138kV transmission line from Glennallen to Sutton interconnecting at the Matanuska Electric Association (MEA) O'Neil Substation in Sutton. Total length of the Sutton to Glennallen transmission line is planned to be 125 miles. This line will tie into the existing Glennallen to Valdez transmission line at Pump Station 11 Substation in Glennallen to form a total 138kV transmission line length of approximately 231 miles from Sutton to Valdez. The intertie is planned for an import capability of 40MW. CVEA plans to utilize the import to serve present and future loads that would be served by diesel generation if the intertie were not available. PELHLY 23-112 (1/6/94) 120167-01Am 4 Attachment 3.2 The Alyeska Terminal is a complete power system containing station steam turbine generation, emergency diesel generation, and distribution facilities. The terminal is located approximately two miles west of Solomon hydro. The intertie to the Anchorage Railbelt system will allow CVEA to serve Alyeska with power from Anchorage. This report assesses the feasibility of CVEA serving Alyeska from such an interconnection and the impact on the reliability of both CVEA and Alyeska. PE-HLY 23-112 (1/6/94) 120167-01Am 2 a“ SUMMARY OF FINDINGS Resource availability of the Railbelt system is more than adequate to serve CVEA's present and projected loads, including Alyeska. Projected winter loads and generation resources through 2002 shows the Railbelt system maintains a 76 percent generation reserve margin. This reserve margin represents 542MW in 2002. Power supply reliability at Sutton is very good. The last five year average annual outage time was 1.26 hours. Future outage time is expected to be lower due to Railbelt transmission system reliability improvements. The Glennallen to Sutton 138kV transmission line is expected to be very reliable due to the absence of extreme weather or avalanche conditions over the proposed route. Rated transfer capacity of the Glennallen to Sutton intertie is planned to be 40MW. This intertie capacity will serve load presently served by the CVEA diesel plants which will improve the overall reliability of the CVEA system. CVEA system availability to supply Railbelt energy to Alyeska is dependent primarily on the availability of the Valdez to Glennallen 138kV intertie. This intertie has experienced one extended outage of nine months due to an avalanche in 1988. The avalanche was due to extraordinary snow depth. CVEA is planning avalanche mitigation for this line. Excluding the 1988 avalanche occurrence and adjusting for CVEA operating practices, the average outage hours over the last five years for this line would have been 2.55 hours per year. PE-HLY 23-112 (12/8/93) 120167-O1Am 3 Attachment 3.4 ¢ CVEA system availability to serve Alyeska from Solomon hydro is very good. Solomon hydro has been available an average of 99.98 percent per year over the last five years, which represents 1.68 hours of outage time per year. + Alyeska's Valdez Terminal can be served from CVEA's Solomon hydro substation via a two mile 24.9kV overhead line and a 24.9kV-13.8KV10/12MVA substation located on the east end of the Terminal electrical distribution plant. + Alyeska must install approximately 2,000 feet of 13.8kV cable to provide a dual circuit connection from the east end of the Terminal distribution system to the CVEA substation. «¢ CVEA and Alyeska load variations will require VAR compensation for voltage control in Valdez, This can be provided by spinning Solomon hydro generators, spinning Alyeska generators, and/or a static VAR system (SVS). + Starting Alyeska's 1500HP vapor recovery motor starting will require mitigation to prevent excessive voltage dips on the CVEA Valdez system. Three methods of mitigation are defined: reduced voltage starters on the motors; spinning one Alyeska Main Power Plant generator; or installing a SVS on the CVEA system. « The Alyeska Terminal has experienced power outages due to loss of Terminal Main Power Plant generation. Some outages have been extensive due to the inability to PELHLY 23-112 (12/8/93) 120167-01Am 4 restart generation. Alyeska now operates two 15.3MVA Main Power Plant Generators to improve operating reliability. _. In the event of loss of the 138kV Valdez to Glennallen intertie, the CVEA Valdez system has sufficient generation resources to meet projected load growth with Alyeska loads until year 2003. After year 2003, additional CVEA generation resources will be required in Valdez. For the case of loss of normal power supply, the Alyeska Terminal has an emergency power requirement of 2 to 3 MVA._ In the event CVEA is unable to supply Alyeska with Railbelt energy due to loss of the 138kV transmission system, CVEA can supply Alyeska with emergency power from Solomon hydro until CVEA diesel generation can be brought on line in Valdez. CVEA is planning to maintain the Valdez diesel plant in hot standby. This plant would be available within two hours CVEA maintains an automated rapid start 2.3MW SOLAR turbine at the Valdez diesel plant. This unit is available within one minute via remote control from CVEA's Valdez control center, located at Solomon hydro. Alyeska must maintain Main Power Plant generation and emergency diesel generation in proper operating condition for emergency requirements. PE-HLY 23-112 (12/8/93) 120167-01Am 5 Attanhment 7 A wer CONCLUSIONS CVEA can reliably serve the Alyeska Terminal with an interconnecting line and substation from the Solomon hydro substation. Terminal normal operating power can be reliably served with energy imported con the Railbelt electric system in Anchorage via a 138kV transmission line interconnecting CVEA to the Anchorage Railbelt system. Emergency power can be provided to the Alyeska Terminal from Solomon hydro when import from the Railbelt is not available due to loss of the 138kV transmission line. Emergency power will be provided until CVEA Valdez generation can be brought on line, a time expected to be one to two hours. CVEA intends to maintain adequate Valdez generation reserves to meet CVEA Valdez and Alyeska Terminal load requirements. .. Solomon hydro will be used for generation during spring and summer water runoff but from September to April maximum water storage capacity will be reserved for emergency use and spin for VAR generation. Providing both operating and emergency power to Alyeska from CVEA will improve the reliability. of the Terminal in that the Terminal will have central station operating and emergency power from CVEA and redundant Main Power Plant generation and emergency diesel generation at the Terminal. VAR generation is required to maintain adequate voltage stability in Valdez. Reduction of system voltage dips due to starting the Terminal 1500HP Vapor Recovery motors will require either reducing the motor inrush, maintaining a Terminal Main Power Plant generator spinning, or an SVS in the CVEA Valdez system. Terminal generation must be maintained in adequate operating condition by Alyeska to provide power to the terminal in the event of a CVEA emergency that precludes CVEA from providing power to the Terminal. The greatest outage hazard is the Valdez to Glennallen 138kyY intertie. This line is subject to the possibility of extended | outages due to avalanche. CVEA planned avalanche mitigation will reduce this hazard. PELHLY 23-112 (12/8/93) 120167-01Am 6 RECOMMENDATIONS The following are recommendations for the purpose of providing power from the Anchorage Railbelt system to CVEA loads and the Alyeska Terminal load: 1. Intertie Solomon hydro substation to Alyeska via a 24.9kV distribution line and a 24.9-13.8kV 10/12 MVA substation. CVEA intertie facilities are estimated to cost $1,170,631. 2. Intertie Alyeska's Terminal distribution system to the CVEA 24.9-13.8kV 10/12MVA CVEA substation via a 13.8kV loop cable interconnection. This 13.8kV loop cable system is estimated to cost $331,189. 3. Utilize Solomon hydro for voltage regulation by allowing one unit to spin. 4. Install an SVS at Solomon hydro for mitigation of motor starting dips and voltage transients due to CVEA and Alyeska load variations. An SVS is estimated to cost $500,000. 5. CVEA should plan to provide an SVS at CVEA's Meals Substation in Valdez for voltage regulation prior to load growth in the Valdez area reaching the point that one Solomon hydro unit can no longer maintain voltage regulation. Based on present load growth projections it is anticipated that this requirement would be prior to 2005. This SVS is estimated to cost $500,000. 6. CVEA should plan for additional generation in the Valdez area beginning in 2003 to meet CVEA and Alyeska load requirements. No cost estimate has been determined for this requirement. PELHLY 23-112 (12/8/83) 120167-01/tm 7 Attachment 3 & ANALYSIS Railbelt Resources/Load The Railbelt utilities (consisting of Chugach, Matanuska, Golden Valley, Homer, City of Seward, and Anchorage Municipal Light & Power) are all cooperative or municipal electrical utility systems that are interconnected to one large transmission and generation system, which is termed the Railbelt System. The interconnected system provides for the efficient scheduling and utilization of available generation and transmission resources. The Alaska Energy Authority (AEA) and each of the utilities own some part of the system. Chugach Electric Association (Chugach) is the largest of the Railbelt utilities, and, with one exception, provides all or a part of the power supply requirements to the other participating utilities. The Alaska System Coordinating Council reported in it's April 1993 "Coordinated Regional Bulk Power Supply Program Report" that the Railbelt utilities have projected a 1994 summer peak hourly demand of 544 MW against a total available summer capacity of 1,176MW. The report projects a winter peak hourly demand in the winter of 1994/1995 of 649MW against a total available winter capacity of 1,284 MW (see Attachment A). Cost of generation and purchased power for the Railbelt utilities varies from 3%4-5¢/kWh. PELHLY 23-112 (12/8/83) 120167-01/tm 8 Attarhmant 7 0 CVEA Resources/Load CVEA's power supply is a stand-alone generation system (not interconnected to any other utility) comprised of two diesel plants owned by CVEA and the Solomon hydro plant owned by the State of Alaska and operated by CVEA under a long term contract. Generation capacity consists of 7.3MW of diesel, 12MW of hydro and a 2.8MW rapid start SOLAR turbine in Valdez, and 7.0MW of diesel in Glennallen. Total prudent operating capacity of the two diesel plants is approximately 14.5MW. The two generation areas, Valdez and Glennallen, are interconnected by a 106 mile 138kV transmission line. _Water, operational, and maintenance constraints reduce the total system installed prudent operating capacity from 26.4MW to a low of approximately 16MW. This variation in operating capacity is due to water storage capacity limitations and CVEA utilization of = Solomon Hydro. Solomon hydro is typically used in the months of May through September to meet CVEA load requirements and operated near minimum from October until May when water storage is low (see Attachment B). The 26.4MW of capacity represents maximum water storage and the 16MW represents minimum water storage. CVEA's projected 1994 peak demand is 12.2MW. Solomon hydro has a nameplate capacity of 12MW but, due to the low ambient temperatures in Valdez, has the capability of operating 10% over nameplate without any - detrimental effects on the generators, thus increasing the capacity of the plant to 13.2MW, subject to the availability of water in the reservoir. Although the nameplate capacity of t ‘ Solomon hydro exceeds CVEA's requirements, that capacity is only available for four months out of the year due to the water storage capability of the reservoir . PELHLY 23-112 (12/8/93) 120167-01/m 9 Attachment 3.10 Solomon hydro has historically provided all of CVEA's power requirements from mid to late May until early to mid October. For the four-year period 1989 to 1992, net hydro production has varied from a low of 40,000 MWh to a high of 46,700 MWh. As a conservative planning base, CVEA projects that Solomon hydro will be able to produce 45,000 MWh annually through various weather and usage patterns. This is estimated to be the maximum dependable production from Solomon hydro, which will require CVEA to be prepared to serve all additional new load growth with supplemental generating resources. During the October to May period when Solomon hydro will not provide 100 percent of energy requirements, the two diesel plants meet the balance of CVEA's requirements. For the past four years, the diesel supplement has ranged from 13,000 MWh to 21,000 MWh. The addition of the Petro Star Refinery in early 1993 was expected to add 19,710 MWh to CVEA's total load and was projected to increase the diesel supplement to 35,000MWh. Petro Star has recently informed CVEA that they expect their load to double in the next three years and nearly double again in the next ten years. As stated above, from 1993 on CVEA will have to be prepared to serve all new load growth from non-hydro resources. If future load growth tracks CVEA's 1993 Power Requirements Study, supplemental requirements will grow to 55,000 MWh in the year 2003 and 72,000 MWh in the year 2013 plus Petro Star's additional requirements. CVEA's present winter peak load is 8,970kW in Valdez and 3,650kW in Glennallen giving a total system winter peak of 11,850kW. Projected loads for year 2013 are 13,300kW for Valdez and 5,700kW for Glennallen with a total projected system peak of 17,300kW. PELHLY 23-112 (12/8/93) 120167-01/tm 10 Petro Star is planning to triple their load in the next ten years to from their present load of 1.8MW to 5.5SMW. This would give a projected 2013 system peak winter load of 21,000kW of which 15,200kW of peak load would be in Valdez. With the addition of Alyeska, the projected CVEA loads will increase by 7.5MW which, under present loading conditions, would give a present system peak load of 19,350kW and a projected 2013 peak winter load of 28,500kW. The Valdez 2013 peak winter load would then be 24,500kW. With the Glennallen to Sutton intertie to the Railbelt system, the combined import/generation capability of the CVEA system will be 66MW, import capability from the Railbelt being 40MW and CVEA internal generation being 26MW. Using the intertie to serve load will allow CVEA to maintain Solomon hydro water storage reserves at maximum, thereby maintaining import/generation reserves at 66MW all year. In the event of loss of the intertie to Valdez, 22,000kW of generation is presently available in Valdez to serve load. Based on current load projections, the Valdez load including Alyeska will reach 22,000kW in 2003. After 2003, CVEA will need additional generation in Valdez to serve peak winter load in the event of loss of the intertie to Valdez. If an intertie outage were to persist for an extended period, additional generation capacity would be required in Valdez due to the limited storage capacity of Solomon hydro. An extended outage is considered to be an unlikely event but if this case were to occur it would be necessary for Alyeska to supply either a portion of or all of their power requirements until the intertie was re-established. It will therefore be necessary for Alyeska to maintain the Terminal Main Power Plant in an adequate operating condition to meet a CVEA power outage emergency. PELHLY 23-112 (12/893) 120167-01/tm at Attarhment 2 17 Import capacity from the Railbelt system exceeding 1SMW will require VAR support in Valdez for voltage stability. CVEA plans to spin one Solomon hydro unit for system VAR support and provide an SVS for voltage stability. As CVEA system load continues to grow with time, VAR support requirements that exceed the capability of Solomon hydro will be provided by additional SVS units in Valdez and Glennallen Condition of CVEA Generation: Solomon hydro Solomon hydro is in excellent condition and can be expected to operate into the indefinite future with normal maintenance. The plant was brought on ine in 1982 and has a reasonable life expectancy of 50 to 75 years. Glennallen Diesel Plant The Glennallen diesel plant is made up of seven reciprocating diesel engines: two 300 kW 1959 vintage Fairbanks Morse; one 1963 and two 1966 600kW Fairbanks Morse; and two 1975 2,624 kW Enterprise Units. The two 1959 Faribanks Morse units are not included in the total capacity available. The unavailability of parts and the prohibitive cost of having them special made prompted the decision several years ago not to continue scheduled major maintenance on the units. Both units are operational in an emergency but are not considered to be sufficiently ‘reliable to be classed as a base resource. PE-HLY 23-112 (12/8/93) 120167-01Am 12 Attnnhmant 2 17 Mi For the past several years, the plant has been used as a primary supplemental generating resource and has been maintained to an acceptable standard of reliability. Valdez Diesel Plant The Valdez diesel plant is comprised of six reciprocating diesel engines and one turbine: three 1966 600kW Fairbanks Morse; one 1972 1,900kW Enterprise; one 1975 2,600kW Enterprise; one 1952 965kW Enterprise; and one 1976 2,800kW SOLAR turbine. This plant is presently maintained to an acceptable standard of reliability with all units available for base load operation. Alyeska Resources/Load The Alyeska Terminal consists of a total stand alone power generation/distribution system. Figure 1 is a one line diagram of the Terminal electrical system. The generation system consists of three 15.63 MVA 13.8kV General Electric steam turbine generators located at the Main Power Plant, central to the distribution system. Power from the Main Power Plant is distributed through 13.8kV switchgear located in the Main Power Plant to 13.8kV feeders serving the various areas of the facility. The distribution system is 13.8kV cable mounted in above ground cable trays. Total system load is 8.7SMVA. PEFHLY 23-112 (12/8/93) 120167-01Am 13 Attachment 3.14 OVER IEAD LE ~ ALLISON CREEK =siy re WATER Puurs: eae VALVE 872 —@ yA 28 Om DD Coan gy ror VAPOR RECOVERY SEAVICE rar Oy rar POWER GENERATION STATION SERVICE ( — i I ETT Gg FIGURE 1 TERMINAL SYSTEM ONE-LINE DIAGRAM Wess He TKR 810 TKR ROTO iK FARM EAST TANK FARM There are two emergency diesel generators. A 1.3MVA unit is located in the Main Power Plant and a 2.1MVA unit is located at the Operations Control Center. These generators serve an emergency load of 2MW and provide starting power for the Main Power Plant generators. Critical loads are served by UPS systems located at the critical loads. The UPS systems are designed to supply power for a minimum of two hours. If Main Power Plant generation is lost, the UPS system maintains critical loads until the emergency diesel Peet comes on line. Emergency loads are served by the diesel generation until Main Power Plant generation can be started. Main Power Plant generation is typically started within four hours but can take as long as eight hours if a cold unit must be started. PEI-HLY 23-112 (12/8/93) 120167-01Am 15) Railbelt Reliability The proposed Glennallen to Sutton intertie will tie into the MEA 115kV transmission system that interties between Chugach's system at Teeland Substation and Anchorage Municipal's system at Anchorage Substation. Both of these stations are part of the Railbelt interconnected system. This provides two firm feeds to the Sutton intertie point. The number of hours that power has not been available at Sutton is not documented by MEA. The events that would cause a power outage at Sutton is loss of both 115kV feeds or loss of power from the Railbelt interconnected system. MEA outage data shows 12 outage events since January 1988 at O'Neil Substation, the MEA Substation at Sutton. The five year average outage hours per MEA consumer for 1988 through 1992 due to power supplier, which is the Railbelt interconnected system, is 1.26 hours. From this data we would conclude that on average, power from Sutton would be interrupted two times per year and the total annual outage time would be 1.26 hours. Reliability of the Railbelt interconnected system has been improved since 1988 with transmission system protection improvements, transfer capability improvements, and load shedding improvements. These improvements have increased system reliability by increasing the system stability margin. Major lines and major generation units can now trip off without causing loss of the Railbelt system. With these improvements now in place it is expected that the average annual outage time at Sutton attributable to power supply will be less than one hour per year. PELHLY 23-112 (12/8/93) 120167-01/tm 16 CVEA Reliability CVEA outage records for the five year period of 1988 through 1992 show an average annual outage time per consumer of 5.32 hours. This outage time consists of all causes of outages. A significant portion of outage time is a result of the CVEA generation system going down as a consequence of a transmission or distribution fault, When this occurs, the generation plants must be restarted, synchronized, and load picked up on the system. This process can take one to two hours. The proposed intertie to the Railbelt system will eliminate this outage time by eliminating the need to restart and synchronize the CVEA generation system in order to restore power. Because CVEA generation will not be utilized, the majority of faults on the CVEA system a be cleared by breakers which will ‘mediately reclose to re-establish power to CVEA consumers. Average annual outage time per consumer will be expected to decrease with the intertie to the Railbelt system. CVEA outages that would have affected delivery of power to Alyeska have been compiled for the years of 1989 thiol October of 1993. Two conditions have been tabulated in Table 1, Solomon hydro out which would represent no power delivery to Alyeska, and Railbelt power to Alyeska out representing only Solomon hydro power available to Alyeska. Considering the last five year average outage times, Solomon hydro has been out an average of 1.68 hours per year and the ability to deliver Railbelt power to Alyeska has been out an average 8.55 hours per year. The long outage of 1992 was the result of the Glennallen to Valdez transmission line being out of service due to a winter storm. This outage occurred on a weekend and repairs were not made until the following Monday. Both Valdez and Glennallen were served from local generation. If Alyeska were being served over this line, it is CVEA's opinion that repair time would have been PE-HLY 23-112 (12/8/93) 120167-01Am 17 three hours. Substituting three hours for 33 hours in Table 1 gives an average annual outage time of 2.55 hours. CVEA feels that this annual outage time is typical for this line. TABLE 1 CVEA OUTAGES (hours) *RAILBELT POWER SOLOMON HYDRO TO ALYESKA 1989 2:5 6.0 1990 2.4 eS 1991 1.25 1225) 1992 1.92 33 1993 To Present 0.33 LO AVERAGE 1.68 8.55 * Presumed outage hours based on outage reports Historically, the greatest long term outage risk of the CVEA system is the Glennallen to Valdez 138kV transmission line. This line is exposed to severe weather and avalanches. Since beginning operation in 1981, this line has experienced one severe avalanche outage in December 1988 that lasted nine months. The avalanche was the result of extraordinary snow depth on Thompson Pass. Avalanches of this magnitude are considered to be rare events. According to CVEA, an avalanche of this magnitude has not occurred since the 1940's. CVEA plans to investigate avalanche mitigation measures for this line which will include optimizing structure locations, deflecting the avalanche from structures, and undergrounding portions of the transmission line. Based on the findings of the investigation, CVEA plans to implement an avalanche mitigation plan. In the event of a prolonged outage of this line, sufficient generation must be maintained in Valdez to serve load. PEFHLY 23-112 (12/8/93) 120167-01Am 18 ti The planned Glennallen to Sutton transmission line does not pose the avalanche problem or severe weather problem that the Glennallen to Valdez line does. From Glennallen to Sutton, the proposed routing is virtually free of avalanche exposure. This line is expected to be very reliable, with a low annual forced outage rate. Given the reliability of the Sutton point of delivery from the Railbelt and the expected reliability of the Glennallen to Sutton transmission line, the reliability of the CVEA system is expected to increase with the Railbelt intertie. Alyeska Reliability The Alyeska Terminal system has operated since 1975 with basically the same plant as is existing today. Alyeska is presently operating two main power plant generators to reduce the likelihood of Terminal outages due to loss of one generation unit. Both generators share the plant load thereby giving 100 percent generation redundancy. Prior to the present operation of two generators, Alyeska operated one generator on line at the Main Power Plant and relied on emergency power when the Main Power Plant generator failed. The Terminal emergency power system consists of UPS supplies on critical loads, such as the Operations Control Center which provides control for both the Terminal and Pipeline, and two emergency diesel generators. For emergency operation, non critical loads are manually shed by tripping breakers to a load level of approximately 2MW. UPS supplies carry the critical load until non critical loads are shed and the diesel generators can pick up the emergency load. There is a firm two hour capacity in the UPS supplies for critical loads. This allows time for manual load shedding and diesel generator pickup of emergency loads. Restart of the main power plant can require up to eight hours and PEI-HLY 23-112 (12/8/93) 120167-01/tm 19 power from one of the two diesel generators. This requires that both diesel generators to be on line for emergency load and generator starting. The diesel units have a high failure rate and therefore pose a reliability problem for the Terminal. This fact coupled with the historical failure rate of the Main Power Plant generators has led to the operating policy of having two Main Power Plant generators on line at the same time. In an effort to improve the reliability of the Terminal, Alyeska has considered installing a 13.8kV loop tie on the east end of the Terminal distribution system. This loop tie, when installed, ‘could become a part of the CVEA intertie, thereby providing increased reliability for the Terminal distribution system and serving as the Terminal intertie point. Power Delivery To Alyeska Alyeska's Terminal facility is located approximately two miles west of CVEA's Solomon hydro Facility. Power delivery to Alyeska would be from Solomon via a new 24.9kV distribution line to a nee 24.9-13.8kV 10/12MVA distribution substation to be located on the Terminal. Figures 2 and 3 show this interconnection. A cost estimate for this interconnection prepared by POWER for Alyeska in 1992 estimated the cost to be $1,844,758 for the CVEA facilities and $331,189 for 13.8kV cabling and switches connecting the CVEA facilities to the Terminal distribution system. A review of the CVEA facilities costs with CVEA has reduced the estimated cost of the CVEA facilities to $1,170,631 (see Attachment C). The two areas of cost reduction were the power transformer and the 15kV switchgear. The original estimate included an LTC transformer which will not be necessary with voltage control at Solomon hydro. This allows for a less PE-HLY 23-112 (12/8/93) 120167-01Am 20 LUD suomyvony RN a ee ne arm i SULOMG i i ‘ ' LAKE : 1 1 ALLISON OLOMON GULCH HYDRO FIGURE 2 ALYESKA COPPER VALLEY ELECTRIC ASSOCIATION _ INC. GLENNALLEN 822-3211 VALDEZ 835-4301 F.0. BOX 45 F8 BOX 927 GLCNNALLEN, AK. 99588 VALDEZ, AK. 99686 PROPOSED SOLOMN GULCH TO ALYESKA FEEDER i 4 i} i i) ' ; y) " ' . r f x t t t e: weil ke ' rey nee 4 i ' i i | ; | : 1 ! 2 ! ’ t 4 1 5 ! & ' ' ' a LEOEND? *) I | | va! # WECLUSER ST Low voc tace CinCULT OncaRER DIscommct sw ~ JER remem tmastomen T I “T => ccsanvs| comet ct 10m ) ) hese ae. oa ai No ies mos, . tase ‘mc 10-8 USED OISCORMECE a ito 10 va 24,9-13. 071.96 Y : 2006 | at gS pe a Re aS av cea Sex QUO Gin CH POWR PLANE POWER CLMERAT ION TORY SWITCHGEAR NG DOES NOI SHOW VEEDERS FROM THe renee se aru cu 2. CLOUDED ANLA TMUICATES MEM CONSTHUC TION, CONCEPTUAL, ONE-LINE DIAGRAM NEW ALYESKA= CVEA INTERTIE Hts extensive transformer to be used. The estimate also included 15kV switchgear for the substation. CVEA plans to provide open bus with breakers at less cost. For normal operation, the terminal will require 8.75MVA of power and for emergency operation 2.6MVA of power. The proposed intertie system from Solomon hydro will have a power delivery capability of approximately 12MVA. The internal Terminal plant 13.8kV cable capacity will be 1SMVA with parallel cables and 9MVA with one cable out of service. During normal CVEA system operation, power will be delivered from the Railbelt system with Solomon hydro spinning for voltage support. In the event power delivery from the Railbelt was lost, Solomon hydro will be utilized for emergency generation to Alyeska, i.e., the Terminal would curtail power usage until Railbelt power availability was re-established or CVEA generation was available. Solomon hydro would be spinning to provide system WAR support so that emergency power would be immediately available in the event of loss of Railbelt power. The SOLAR turbine generator is also available at Solomon hydro as a rapid start 2,800kW unit which could be used for emergency power if required. CVEA diesel generation would be available to Alyeska for normal operation within one hour if the intertie could not be re-established sooner. Solomon hydro availability will be maintained by maintaining water storage in the reservoir near maximum all year. In September the reservoir capacity would be full with 28,666 acre feet of usable water. The Railbelt intertie would be supplying the CVEA system energy requirements, Solomon hydro spin would require approximately 7,616 acre feet of water for the eight months of September through April. With an inflow of 3,000 to 5,000 acre feet of water during the eight months of spin, a minimum of 24,050 acre feet of water would be available for emergency operation. This would provide approximately . 12MW of power for one month. PEI-HLY 23-112 (12/8/93) 120167-01Am 23 Maintaining voltage stability in the CVEA and Alyeska systems will require an SVS to be located at Solomon hydro. Solomon hydro will provide system voltage regulation but will not respond fast enough to correct transient voltage fluctuation due to CVEA and Alyeska variations which required the SVS. The SVS will function to correct transient voltage fluctuations. This unit is estimated to cost $500,000. Short Circuit Current An intertie to Alyeska will increase the available fault current in both the CVEA system and the Terminal system due to the generation sources of both systems. The greatest increase occurs in the Terminal system for the case of one Alyeska generator on line with both Solomon hydro units on line. It will be necessary to evaluate the short circuit withstand ratings of the Terminal with the CVEA intertie. The increase in CVEA short circuit currents due to one Alyeska generator is also significant and will require an evaluation of the short circuit withstand ratings of the CVEA system. Motor Starting The Alyeska Terminal contains a number of large induction motors that are line started at 4.16kV. Table 2 is a summary of the large motors. A voltage dip will occur on the CVEA system when connected to Alyeska and a large motor is started. The most severe Starting case are the 1500HP Vapor Recovery Motors. These motors have a 6.8 times rated current starting inrush. Operating requirements of the terminal require that these motors be started often. The impact on both the Terminal and the CVEA electrical PEI-HLY 23-112 (12/8/93) 120167-01/tm 24 systems due to starting of the Vapor Recovery 1500HP motors is shown in Table 3 for various generation and intertie conditions. TABLE 2 ALYESKA 4.16kV MOTORS QUANTITY MOTOR SIZE 5 1500HP = Z 700HP 2 350HP 4 300HP 3 200HP For residential and commercial consumers, REA recommends that infrequent voltage dips not exceed seven percent. For the frequency of starting the vapor recovery system a five percent limit would be appropriate. This limit would apply to both the Solomon hydro bus and Meals Substation. Table 3 shows that to reduce the voltage dip at Solomon hydro to five percent requires one Alyeska generator on line at the Terminal Main Power Plant spinning but not producing power. The alternatives to spinning one Alyeska generator are: to install reduced voltage or soft start equipment on the 1500HP Vapor Recovery Motors; or install a static VAR system (SVS) at Solomon hydro for voltage dip reduction; or install new motors with low inrush starting requirements. All three of these alternatives require capital investment. Alyeska has investigated increasing the Vapor Recovery motors to 2000HP. If a motor change were made, lower inrush motors could be utilized. PEI-HLY 23-112 (12/8/93) 120167-01/tm 25 wuss ad rs Analysis of the CVEA system indicates that an SVS will be required at system Railbelt import levels above 1SMW for voltage stability in Valdez. Therefore, CVEA is planning to install an SVS at Solomon hydro for system import capability. This SVS would be designed for both motor starting voltage reduction and system voltage stability. TABLE 3 ALYESKA 1500HP MOTOR STARTING BUS VOLTAGE PU (Ref 1. — : Vapor Meals 25kV | Solomon25kV | MainPower | . Recovery Plant 13.8kV 4.16kV GENERATION CASE 1. One Alyeska Gen. No CVEA Tie . No Gen Railbelt Intertie 3. One Alyeska Gen Railbelt Intertie . One Solomon Gen Railbelt Intertie 5. One Alyeska Gen One Solomon Gen Railbelt Intertie 6. Two Solomon Gens Railbelt Intertie 7. Two Solomon Gens One Alyeska Gen Railbelt Intertie Nv PELHLY 23-112 (12/8/93) 120167-01tm 26 ATTACHMENTS are V LNSWHOVLLVY 1993 1994 1995 1996 1997 Sum. | | Win. | Sum. | [ Win, | Sum. [| Win. | Sum. |] Win. | Sum. | Win. DEMAND IN MW 01 Internal Demand 535 658 544 649 550 661 559 671 566 681 02 Standby Demand (if not included in 01) i 0 0 0 0 0 0 0 0 0 0 03 Total Internal Demand (01+ 02) 535 658 544 649 550 661 559 671 566 681 04 Direct Control Load Management 0 0 0 0 “0 0 0 0 0 0 os Interruptible Demand (Ft. Richardson) 4 AG 5 5 5 5 5 5 5 5 06 Net Internal Demand (03-04-05) ’ 531 654 539 644 545 656 554 666 561 676 CAPACITY, NET, IN MW 07 =Total Owned Capacily 1,176 1,284 1,176 1,284 1,176 1,284 1,169 1,276 1,169 1,276 08 Inoperable Capacity (if included in 07) oO 0 0 0 0 Oo. 0 0 0 0 09 Net Operable Capacity (07-08) 1,176 1,204 1,176 1,284 1,176 1,264 1,169 1,276 1,169 1,276 10 Non-Ulilily Generators 0 0 0 - 0 0 0 0 0 0 0 1 Capacily Purchases (Tolal) 0 0 0 0 0 0 0 0 0 0 \la Full Responsibilily Purchases 0 0 0 0 0 0 0 0 0 0 12 Capacily Sales (Tolal) 0 0 0 0 0 0 0 0 0 0 12a Full Responibility Sales 0 0 0 0 0 0 0 0 0 0 12b Adjustment to Purchases and Sales 0 0 0 0 0 0 0 0 0 0 13. Net Capacity Resources (09+10+11-12+12b) 1,176 1,284 1,176 1,284 1,176 1,284 1,169 1,276 1,169 1,276 14 Planned Oulage 265 0 163 17 163 0 243 17 186 17 15 Net capacily Resources - Planned Oulage (13 - 14) 911 1,284 1,013 1,267 1,013 1,284 926 1,259 983 1,259 ITEM 3A PROJECTED CAPACITY AND DEMAND FIRST FIVE YEARS CONCIL: ASCC VY INSWHOVLLVY DEMAND IN MW 01 ‘Internal Demand 02 Standby Demand (if not included in 01) 03 Total Internal Demand {01+ 02) 04 Load Management 05 Interruptible Demand 06 Net Internal Demand (03-04-05) CAPACITY, NET, INMW 07 =Total Owned Capacily 08 Inoperable Capacily (if included in 07) 09 Net Operable Capacily (07-08) 10 Non-Ulilily Generalors 11 Capacily Purchases (Tolal) ila Full Responsibility Purchases 12 Capacily Sales (Total) 12a Full Responibilily Sales 12b . Adjustment to Purchases and Sales 13. Nel Capacity Resources (09+ 10+11-12+12b) 14 Planned Outage 15 Nel capacily Resources - Planned Oulage (13 - 14) « ITEM 3A CONCIL: ASCC PROJECTED CAPACITY AND DEMAND : SECOND FIVE YEARS 1998 1999 2000 | 2001 2002 Sum. Win. | Sum. | | Win. | Sum. L Win. sum. [ | Win. | Sum. O Win. 573 690 585 702 590 708 598 718 601 722 0 0 0 0 0 0 0 0 0 0 573 690 585 702. =—-590 708 598 718 601 722 0 0 0 0 ‘0 0 0 0 0 0 5 1 5 5 5 5 5 5 5 5 5) 568 685 580 697 585 703 593 aS) 596 717 1,169 1,276 1,169 1,276 1,169 1,276 1,169 1,276 1,169 1,276 0 0 0 0 0 0 0 0 0 0 1,169 1,276 1,169 1,276 1,169 1,276 1,169 1,276 1,169 1,276 0 0 0 - O 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Oo 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1,169 1,276 1,169 1,276 1,169 1,276 1,169 1,276 1,169 1,276 163 17 163 0 243 17 186 17 163 17 1,006 1,259 1,006 1,276 926 1,259 983 1,259 1,006 1,259 @ LNSWHOVLLY MEGAWATT HOURS ; (Thousands) a ne COPPER VALLEY ELECTRIC ANNUAL GENERATION BY MONTII —— GENERATION — DIESEL — \-GENERATION HYDRO nr GENERATION ! T T 1 A M J J A HYPP 9-297 PRATECTION ty a te CVEA - ALYESKA INTERTIE COST SUMMARY MATERIAL & LABOR COST $900.485 ENGINEERING (15%) $135,073 See ee) a ae ATTACHMENT C CONSTRUCTION COST ESTIMATE CVEA - ALYESKA INTERTIE File: CVEAEST x!3 03-Dec-93 MATERIAL COST LABOR COST OTHER ITEM UNIT |QTY.| UNIT |SHIPPING TOTAL MAN-'| AVG. | TOTAL | DIRECT JINDIRECT] LINE PER UNIT HOURS | RATE costs | costs | TOTAL . or_[ | 9a m1 | _1 |A1; SITE WORK, GRADING LoT $12,155 | __2 |A2;, SITE WORK, SURFACING Lot 38,500 | __3 |B1; FENCE, CHAIN LINK $7,370 $1,106 $7,140 $15,616 | _4 |C1; FOUNDATION, SPREAD FOOTING | EACH | $330 $10,120 $26,388 | __5 |C2; FOUNDATION, SLAB | EACH | $858 $13,156 $29,384 | EACH | k $3,400 [| _6 |D1; ENTRY STUCTURE W/SURGE ARRESTOR & FUSES | __? |02; STRUCTURE, 24.9 DEADEND SWITCH | __6 |E1; XFMR, WALTC $0 $28,700 $2,040 $428 $4,998 [__® |E2; SWITCH, 24.9 KV $3,570 $428 3; 13.6 KV BREAKERS $3,400 $0 $7,140 $1,107 $4,080 $0 $2,890 $0 $1,700 $0 $4,675 $0 311,259 $85 | $12,920] $2,213 $26,392 $20,873 $85] $18,700] $2,213] $0] $41,786 | | __19 [J1; PAINTING, TOUCHUP $4,048 $85 | $2,890 $750 30 $7,688 [20 |K1; TESTING, SUBSTATION 30 $85 | _$14,960 30 30 314,960 | _21 |L1, 24.9KV DISTRIBUTION LINE — = = = $260,070 | * | __ 22 |L2; CVEA CONNECTION POINT. — = — = $47,350 |* | 23 |M1; MOBILIZATION $85 | $41,140 30 $0 $41,140 $900,485 * From CVEA Cost Estimates Attachment 4 LAW OFFICES OF KEMPPEL, HUFFMAN AND GINDER A PROFESSIONAL CORPORATION ROGER R KEMPOEL + ANCRORAGE OF RICHARD RU . PETER C. SIN DONALD C Ett: SS.© FirewzeD LANE. s— MORAGE. ALASKA 99503-2095 (907: 277-'6Cs + _ a =£Lxs = 76-23 November 4, 1993 ELECOPIER 19071 276-2253 ANOREW J. FIERRO - a GEORGE S HARRINGTON SR TORDOVA OFFICE sv 9 SOBBY SEAN SMITH CONFIDENTIAL 329 2NO STRE JAY D DURYCH Y-CLIENT COM? ?.0 SOx 182 CORDOVA, ALASKA B9ETS '9O7I 222-74°C TELESSPER 19071 225-7 s 8s JNICATION Clayton Hurless General Manager Copper Valley Electric Association. Inc. Post Office Box 45 Glennallen, Alaska 99588 Re: Alyeska Generation Sales Agreement Qur File No. 91-1065.66 Dear Clayton: It is my understanding that Alyeska Pipeline Service Company (“APSC”) has approached CVEA concerning CVEA providing power to Alyeska’s terminal facility in Valdez. If power is provided to the terminal facility by CVEA. the possibility of Alyeska providing emergency stand-by generation from the terminal facility has also been discussed. However. Alyeska has voiced a concem that if it provides emergency stand-by service. it may be regulated by the Alaska Public Utilities Commission. This matter was addressed over two years ago. At that time. this office concluded that Alyeska would not be subject to APUC regulation under this scenario. My opinion remains the same for the following reasons: The APUC’s regulatory authority is found at AS 42.05. er seg. (pertinent sections enclosed). Exemption from regulation is provided in certain situations. For instance. AS 42.05.711(j) provides: The provisions of this chapter do not apply to sales, exchanges or gifts of energy to an electric utility certificated under this chapter when the energy which is the subject of the sale, exchange or gift is waste heat. electricity, or other energy which is surplus or the by- product of an industrial process... . A contract for the sale. exchange or gift of energy exempt under this subsection does not make the supplier a public utility, and does not transfer the responsibility to provide utility services from a certificated utility to another person. Past discussions have indicated that the electricity generated at the terminal facility is associated with the production of steam during the process of cleaning ballast water pursuant to Alyeska’s environmental permits. The steam produced in this cleaning process is run through a turbine and used to generate electricity. Thus, it is my opinion that the electricity so generated is a by-product of an industrial process and, as such, is exempt from regulation under the foregoing statute. Attachment 4.1 oe Clayton Hurless November 4, 1993 Page 2 The foregoing statute also provides that surplus electricity, regardless of the method of generation, is also exempt. Consequently, whether the electricity is generated as a by-product of an industrial process or otherwise, as long as it is surplus to the needs of Alyeska, Alyeska is exempt from regulation. In addition to the express exemptions provided for in the foregoing statute, the APUC “may exempt a utility, a class of utilities. or a utility service from all or a portion of this chapter if the Commission finds that the exemption is in the public interest.” AS 42.05.711(d). Thus. regardless whether the electricity generated by Alyeska is surplus or the by-product of an industrial process, such generation may be exempted if it is in the public interest. Presumably. a showing that provision of power to the terminal facility would pusitiveiy impact CVEA’s other members (in the form of a rate reduction or otherwise) could be exempted from APUC regulation. The APUC opined as much in its letter of March 21, 1991, to CVEA (copy enclosed)—In this letter, the APUC indicated that there were several possible avenues which could be used so that Alyeska would not become a regulated utility. The APUC specifically mentioned AS 42.05.711(d) and (j). While T am of the opinion that Alyeska is clearly exempt from regulation, CVEA could file a “Request for a Declaratory Ruling” with the APUC confirming Alyeska’s exempt status. However. such filing in my opinion is unnecessary, and it would be.a waste of CVEA’s time. energy. and money. I would like to point out that I am aware of at least one other instance where an electric cooperative has entered into a comparable arrangement. Kodiak Electric Association, Inc. (“KEA”), entered into a contract many years ago with the U. S. Coast Guard. This contract provided that KEA would provide electricity to the U. S. Coast Guard support center on Kodiak Island. Once the U. S. Coast Guard determined that KEA’s provision of electricity was satisfactory for its needs, the Coast Guard ceased production of power from its diesel facilities at the support center. KEA subsequently entered into an agreement with the Coast Guard where KEA provides O&M on a diesel unit owned by the Coast Guard at the support center. Use of this diesel generator is for emergency stand-by purposes only. I have been informed that both KEA und the Coast Guard are satisfied with this arrangement. ; Should you have any additional questions conceming this matter, please feel free to give me acall. Sincerely yours. KEMPPEL, HUFFMAN AND GINDER, P.C. GRA eh— _ Richard R. Huffman RRH:lbf ‘ Enclosures Attachment 4.2 Before Commissioners: Frank J. Bettine; and Alaska Cogeneration Systems, Inc., Complainants, against Copper Valley Electric Association, Inc., Respondent. ° STATE OF ALASKA ALASKA PUBLIC UTILITIES COMMISSION Daniel Patrick O’Tierney Dwight Ornquist |; lew ww SUPPLEMENTAL PREFILED TESTIMONY OF ROBERT WILKINSON ON BEHALF OF COPPER VALLEY ELECTRIC ASSOCIATION, INC. Don Schréer, Chrirman Alyce Hanley Jim Carier (aiatates Wi ean a ¥ LAW OFFICES OF KEMPPEL, HUFFMAN AND GINDER A PROFESSIONAL CORPORATION 255 ©. FIREWEED LANE, SUITE 200 ANCHORAGE, ALASKA 99503 (907) 277-1604 10 | 12 13 14 15 16 17 18 19 20 21 227 23 24 25 26 27 28 STATE OF ALASKA ALASKA PUBLIC UTILITIES COMMISSION Before Commissioners: Don Schroer, Chairman Alyce Hanley Daniel Patrick O’Tiemey Dwight Ormaquist Jim Carte: Frank J. Bettine; and Alaska Cogeneration ) Systems, Inc., Complainants, against ) Copper Valley Electric Association, Inc., —) Respondent. ) ____) U-94-21 SUPPLEMENT AL PREFILED TESTIMONY OF ROBERT WILKINSON MANAGER, ADMINISTRATION AND FINANCE PPER V Y ICA TATION, INC. Q. Are you the same Robert Wilkinson who prefiled testimony on May 5, 1994, or behalf of Copper Valley Electric Association, Inc., in connection with Frank J. Bettine and Alaska Cogeneration Systems, Inc.’s complaint (U-94-21) against Copper Valley Electric Association, Inc.? A. Yes, Iam. Q. The avoided cost calculations and cost of power analysis filed as exhibits to you prefiled testimony were based on the draft Copper Valley Intertie Feasibility Study issue in January 1994, is that correct? A. Yes, it is. Q. I understand the final Copper Valley Intertie study has now been released, is the~ correct? A. Yes. The final report is dated April 1994. Q. As a result of the final report, are there any changes required to your prefile¢ testimony? A, Yes. The final Beck study included numerous changes from the draft repo: These changes required revisions, first to the basic assumptions and supporting schedules next to the cost of power analysis, and finally to the avoided cost calculations themselves. LAW OFFICES OF (907) 277-1604 10 1 12 13 14 15 16 17 20 21 22 23 24 25 What are the specific changes which were made as a result of the Beck study final report? By far the most significant change to the final report was a revision to the medium case load forecast. In the draft report, Beck presented two medium load forecast | scenarios--medium-low and medium-high. The difference between these two medium scenarios had to do with the energy requirements of the Petro Star Valdez refinery. The final study does not establish scenarios for the medium case load forecast; accordingly, separate cost of power and avoided cost calculations for two medium case load forecast scenarios were not necessary. Different cost of power and avoided cost calculations were prepared illustrating high fuel ($.75 per gallon) and low fuel (S.60 per gallon) prices. In addition to the foregoing, the final Beck study resulted in changes to the cost of the intertie and the Allison Lake projects as reported in Beck's cost of power analysis worksheets. Accordingly, revised intertie expense and depreciation numbers were generated for those reports. As a result of the revised load forecast, the timing of diesel capacity additions was - also changed in the final report. This necessitated revisions to amortization schedules for the diesel expansion case. Changes made as a result of the final report are reflected in the assumptions section of the revised prefiled testimony. One other change in the organization of the cost of power analysis worksheets was made in order to improve the overall understanding of the analysis. Separate schedules tiled Schedule of Inflation are attached to each case illustrating how various numbers used in the analysis are developed. This schedule was deemed necessary because all Beck KEMPPEL, HUFFMAN AND GINDER A PROFESSIONAL CORPORATION 255 E, FIREWEED LANE, SUITE 200 ANCHORAGE, ALASKA 99503 SUPPLEMENTAL PREFILED TESTIMONY OF ROBERT WILKINSON MANAGER, ADMINISTRATION AND FINANCE COPPER WALLEY ELECTRIC ASSOCIATION, INC. Page 2 LAW OFFICES OF KEMPPEL, HUFFMAN AND GINDER A PROFESSIONAL CORPORATION 255 E. FIREWEED LANE, SUITE 200 (907) 277-1604 ANCHORAGE, ALASKA 99503 10 WW 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 numbers in the final report are calculated in 1993 dollars. Accordingly, some numbers needed to be inflated for purposes of the cost of power analysis. Q. Does this conclude your supplemental testimony? A. Yes, it does. SUPPLEMENTAL PREFILED TESTIMONY OF ROBERT WILKINSON MANAGER, ADMINISTRATION AND FINANCE COPPER WALLEY ELECTRIC ASSOCIATION, INC. Page 3 RW-1 RW-2 RW-3 RW-4 RW-5 RW-6 RW-7 RW-8 RW-9 . RW-10 RW-11 RW-12 RW-13 RW-14 z RW-15 RW-16 RW-17 RW-18 % RW-19 INDEX - Integrated Avoided Cost Calculation Integrated Avoided Cost Calculation Non-Integrated Avoided Cost Calculation Non-Integrated Avoided Cost Calculation . Explanation of Avoided Cost Line Items Assumptions of Power Cost Analysis Summary of Cost of Power Analysis Diesel Cost of Power Analysis Allison Lake Cost of Power Analysis Intertie Cost of Power Analysis Diesel Cost of Power Analysis Allison Lake Cost of Power Analysis Intertie Cost of Power Analysis Medium-High Fuel $.75 Fuel Medium-Low Fuel — $.60 Fuel Medium-High Fuel $.75 Fuel Medium-Low Fuel _$.60 Fuel Medium Load-High Fuel Medium Load-High Fuel Medium Load-High Fuel Medium Load-Low Fuel Medium Load-Low Fuel Medium Load-Low Fuel Residual Interest Expense on Existing Diesels Residual Depreciation Expense on Existing Diesels Amortization/Depreciation Schedules - Diesel Case Amortization/Depreciation Schedule - Allison Lake Amortization/Depreciation Schedule - Intertie Letter from David L. Highers to Clayton Hurless dated March 14, 1994 F 4 Lm ‘ow coce ' ® 'o¢ § : ' eB ob Ay $DIE BOS'hs = a x rage 1) A 1) 4 | Pie ale ‘ ~ INTEGRATED SYSTEM MEDIUM LOAD GROWTII HIGH FUEL COST FUEL COST BEG. 1994 $0.7S/GAL. PURCHASED POWER.--FIRM CAPACITY. ED TO PUMP STATION 11 SURSTATION ROY DELIVE! UNAVOIL LAMA MAMA $1,993 LABOR ARE $38 i LABOR-PRODUCTION $617 $176 $837 3651 5186: MAINTANENCE & OPERATION $851 $743 sios ' S704 3103 DIESEL INTEREST S1SS $1553 7 S247 ; 980 ‘ AVOWOED Cost sener ne ern ANN Y er ree SOD nee ONZE rer SOUR MISTER TIE CASE ee eee aeaiatereeaoceee _ YEAR — t)hUD)LlUl hued SUETLEMGNTAL REQURENENT ADVICE ere ede ee erareeaeert toot eee | See COST ConTPONET ‘OIDEIS UIA VOI, “TOT. COST AVOID CNA COTE,” TOT. COST "X PONTE NORE NEMEC OEON OCEAN TON EOIN HONE MANESCO NONE EY MOLEC NE EES AN ENE NINT EEDA ODE CEA EE COST OF PURCIIASED POWER $2,077 $2,077 $2,169 $2,169 32,266 IDEPRECIATION--LINE. INTEREST--LINE LINE O&M EXPENSE STANDBY LABOR.-DI i i i $235 S242 OAM DIESEL PLANTS sss RESIDUAL INTEREST--DIE: soy ; $247 . yeni se Eis 5733) S2 266 ; q sa $0020; $0,077 sass souin} sours 50059 son9; sooR! soos Sus 2004 2005 AL,688 Seareteatensetgees sn $2,599 $2,593 |COST OF PURCIIA’ IDEPRECIATION--LINE INTEREST--LINE LINE O&M EXPENSE STANDBY LADOR.-DIESEL. $262 S292 OAM DIESEL PLANTS su 3146 RESIDUAL INTEREST--DIESELS $2 S1VO4TL OD ART I] 18 os Revreedd Per Funal Stly INTEGRATED SYSTEM MEDIUM LOAD GROWTII LOW FUEL COST FUEL COST BEG. 1994 $0.60/GAL. PURCHASED POWER--FIRM CAPACITY & ENEROY DELIVERED TO PUMP STATION LH SUBSTATION LABOR AKE LABOR-PRODUCTION MAINTANENCE & OPERATION DIESEL INTEREST TOTAL POWER Cost AVOIDED COST--K\VI-- SUPPLEMENTAL, REQUIREMENT-MAI- COST COMPONIET weave arneneesancen’ COST OF PURCHASED Powis R DEPRECIATION--LINE INTEREST-LINE LINE OAM EXPENS! STANDBY LABOR--DIt O&M DIESEL PLLANTS RESIDUAL INTEREST--DIE, AVOIDED COST--KWII-- COST OF PURCIIA DEPRECIATION--LINE LINE O&M . 2 STANDBY LABOR--DIESEL ORAS DIESEL PLANTS IDUAL INTEREST--DIESELS fOT.COST $2,077 30.076 awreneanccaneweretie te. a , At o.DE J “33.605 $0,027 soll paweeenecees $2,077 $2,169 $0.056 HOT COST oi Shemmioone $2,822 $0.087 anecoeneseneeopncreassonsensesreneacersesssosssnassensponsinsennss A “SRD 30,058 | 1996 35,023 30.024 30.109 50.086 32.266 $2306” S235; suk $3,000 $0.078 $735 4 30.019 50059 ebeatendareess t $2,593 $262 . sist 392 cee ST, “$05~ $0 082 | soo oi" 30.066 avovaaie Jieve $2300" s270} $1353 $80 S247 $7 02 2 soon i 30.085 $0068 ares Reape venee ea nenenpare nese sus ica cric!. Sete lemme eoremmnn stemmed SRS s18i $106 } 3165 3784" $0.022 $734 $277 $138 $68 $3217 “$730 $0018 $1594 S38 $337 S851 SISS soos SIRS Siz SSS S247 $y $u0x7 ‘$2943 SISO 3651 S74) Saat t soon } a soon “$y a © $4,069" 7" ” seoi sont . S199 TAZEM Fasal Stoste f i A 5 t t E BE: i By 1 FF po of FF fj tf AYUIDED COST CALCULATION NON-INTEGRATED SYSTEM MEDIUM LOAD GROWTIL HIGH FUEL COST FUEL COST BEG, 1994 $0.75/GAL. PURCHASED POWER--NON-FIRM CAPACITY OR ECONOMY ENERGY DELIVE! D TOPUMP STATION IL SUBSTATION 11997 FE THROU $2,076 51.993 LABOR A&E 319 319; 333 S85 S82 1LABOR-PRODUCTION 5748 3582 $166 $617 3176 S314 $633 3837 3651 MAINTANENCE & OPERATION 3708 3608 $100 i +) S704 S103 3829 372 S851 s7Ay DIESEL INTEREST sis3 S174 S165 SISS TOTAL POWER COST S53 SCOT $s POTS STI 97 $383 $4216 59,432 AVOIDED COST.-KWII-- a $0. 47 $a. 090, $0, 027 I $0122 30.098 $0024 sol 20) . 30) O9R | $78 i and 09S $0.02) sssssonssostraseeel INTERTIE CASE--NON-INTEGRATED--NON.| FIRM POWER YEAR SUPPLEMENT, REQUIREMENT. MAI. senna vmnanen oman p eee ace BS HAVOIS” HOF COST "K wane Cost oF PURCHASE i POWER $1,298 me ikis) DEPRECIATION--LINE $1,076 u ‘076 31,076 INTERE: son 3919 3296 LINE OAM EXPENSE $237 3250 3359 STANDBY LADOR--DIE: 3255 $255 Onre DIESEL AS si28 sims sio) sio) $73)" so. $13 $0,019; 50, 096 $0. 019 YEAR SUPPLEMENTAL REQ. (h COST COMIFONET AVON. FCT AVOIDED 0 AIOnCOSt ss ‘ setaeieeh gu nenietge ees NTT Mei Se stentenss. COST OF PURCI i 6 i, 31.16 ; E DEPRECUTION--LINE $1076 $1,076 $1,076 $1,076 $1,076 $1,076 | 31.076 $1,076 $1,096 INTEREST--LINE SARS $883 $870 $870 $856 $856 i Sait $826 5826 LINE O&M EXPENSE $211 $271 $278 3278 $286 5286 { $294 Satz Satz STANDBY LABOR--DIESEL. 262 3270 3270 $277 / ri 5288 3292 $292 ORM DIESEL PLANTS sit $135 5135 $138 5138; siaz S146 51.46 RESIDUAL INTEREST--DIESELS $92 sto $80 S68 68 | $55 $42 $12 s12i ~ seat $0096 soold 30.098 sous Ste O90 ARE Seat . . x : ' ' * ‘ ' * A. S.DEL 4 JS -LCULs. TICS. : a ‘| NON-INTEGRATED SYSTEM MEDIUM LOAD GROWTIL LOW FUEL COST FUEL, COST BEG, 199-4 $0.60/GAL. ~-NON-FIRAI CAPACITY OR ECONOMY ENERGY DELIVERED TO PUMI STATION 11 SUBSTATION PURCHASED Pow i LABOR A&E | LABOR-PRODUCTION $748 $5R2 3176 $633 sist { $337 $651 MIAINTANENCE & OPERATION $708 Soon $103 $723 i $351 $1ay DIESEL INTEREST $18) si74 i $155 DEPRECIATION eed eae SE cence cg seen S242, sense SH sau fsa 5217 TOTAL POWER COST $3.37 $2,002 3795 $3,605 33 $783 i 8 RR Sk AVOIDED COST--KWII-- 30.117 $0,090 $0,027 } sO.1N $0.087 soo24 30.109 30.086 $0022 30.10) oe 3.082, 50.021 3 sn esvovenecosconososoveceesaseptecreancarsseece asensnsosccseosonesd consnoosesoncesarereosenescennsseon seusessecenseen osseepohenssennnnsenasssre seeeeneosarnsseninaesssennsassonsenernsede sons ansinnen INTERTIE CASE--NON-INTEGRATED--NON- FIRM POWER UNAVOID, cena ccresceressesseve hi scesee: TRAV OT COST IONE SERENE i 31,35 COST COMPONT Tener neon cavnee te ICOST OF PURCI el DEPRECIATION: -LINE, SI AIG S101G 3 $1,076 $1,076 $1,076 $1,076 MOG INTEREST--LINE. 3910, i 3930 $930 S919 $908 $896 LINE OAM EXPENSE $237 ; 3243 $24) $250 3359 STANDBY LABOR--DIE: $22 i $235 $235 $242 OAM DIES PLANIS SHS: suk suis siz RESIDUAL INTE Sas i 3135 sas si24 33,551 3736: 33,605 373 34,395 33,661 s7yu S44S* 3h i 33.883 $73) AVOIDED. COST.-KWII-. pr 30.116 so 9G eeee dd 29 i S$O.11S = $0,096 39.019 povoone SOLS. $0.096 ee SOND E . od and 09S, $0.019 SOG $0 098 soo ae ae arise SUPPL MAWET) cee earetaetet o 31,691 $1,691 31,764 DEPRECIATION--LINE 31,076 31,076 31,076 31,076 $1,076 $1,076 INTEREST--LINE $883 $833 3870 3870 $856 S856 LINE OAM EXPENSE 3271 271 $278 3278 3286 S286 STANDBY LABOR--DIESEL 3262 $270 $270 3277 $277 O&M DIESEL PLANTS 3135 3135 SI3R . $138 RESIDUAL INTEREST--DIESELS 380 380 $68 S68 RESIDUAL eeeeeteeteah ea tat a eee oe | 33,915 $732 SA712 $3,982 S70 ¢ K 50.095 SOUR f SOS 30.096 SUNK SH 30096 soon? . . ° S194 11 OO ARE 1 Revised Pet Fwunl Story: AVOIDED COST CALCULATIONS DESCRIPTION OF LINE ITEM APPORTIONMENT IE IN M_APPORTI NT Supplemental Requirement MWH - The amount of energy in megawatt hours required to satisfy CVEA’s supplemental generation requirement. This is 1 used as a basis for calculating on a cents-per-kilowatt hour the avoidable and unavoidable costs. Fuel Cost - Fuel cost is avoidable as the intertie option is expected to eliminate the need for diesel generation. _ Labor A&E - Administrative and engineering labor (i.e., management employees) is ; unavoidable since these employees will remain on staff regardless of the power supply alternative selected. Labor Production - CVEA currently has nine full-time diesel power plant operators. It is expected that all operators are unavoidable through 1997; however, with the intertie alternative, it is expected that only two operators will be retained, one each in the Glennallen and Valdez diesel plants. Accordingly, costs are apportioned 7/9 to avoidable and 2/9 to unavoidable. Maintenance and Operation - The calculation assumes $50,000 of general maintenance expenses exclusive of labor for each diesel plant would be unavoidable. The remaining cost is expected to be avoidable since diesel plants are expected to be shut down when the interte is energized. Maintenance Costs - Maintenance costs in the diesel case relative to fixed and 7 avoidable costs or new units are not cared forward to the avoided cost : ; analysis since, with the intertie coming on line in 1988, new diesels will not be required. Residual Diesel Interest - This is the future interest payments on loans securing existing diese] generation facilities. These costs are unavoidable. Residual Diesel Depreciation - This is the future depreciation expense attributed to existing diesel generation facilities. These costs are unavoidable. NTER INE APPORTIO? ' Cost of Purchased Power - This is the cost of purchased energy and/or capacity under either of the two intertie power supply alternatives. This cost is avoidable. epreciation Line, Interest-Line, Line O&M Expense - These are costs associated with the transmission line in the non-integrated/non-firm case. In the integrated/firm case, these costs would be included in the cost of purchased power. These costs are avoidable. ~ Standby Labor Diesel - It is expected that each diesel plant will be manned with one operator after the transmission line is energized. This cost is unavoidable. 7 O&M Diesel Plants - This line item includes general maintenance exclusive of labor for existing diesel plants after the transmission line is energized. Because 7 diese] plants must be maintained in some form of standby, this cost is unavoidable. - Residual Interest and Depreciation - This is the remaining fixed costs for existing production facilities and the related depreciation expense. Assumptions He w v2 4 Ur COST OF POWER ANALYSIS ASSUMPTIONS ommon To All Alternative MWH requirement is based on Beck study dated April 1994. Supplemental energy requirement is total requirement less Solomon Gulch production. General rate of inflation is assumed to be 2.75%. Costs assumed to escalate with the general rate of inflation are: Labor Diesel fuel Purchased power O&M component Maintenance Depreciation and interest expense on existing CVEA production plant are based on actual 1993 balances and expected amortization. Beck cost assumptions are stated in 1993 dollars. A separate ‘schedule inflating various numbers was prepared for each caes examined which supports the cost of power analysis. [ory 6. DIESEL EXPANSION CASE ASSUMPTIONS Add three operators in 1999 per Beck study. Add two-man maintenance crew, one each in 1999 and 2000. New diesel cost $1,112 in 1992 dollars, interest 5%, 20-year life, no salvage for depreciation. Capital cost is escalated to year of acquisition using 3.5% inflation rate per NC Machinery. New diesel O&M $.01 per kwh plus $12/kw. Fuel efficiency: 1995-96 13 1997 14.5 1998 15 1999-2017 1555) Glennallen and Valdez maintenance on old units set at $50,000/year each plant in 1994 dollars. Indexed to inflation. Reduce maintenance on old units in 1999. Assume diesel units are added in 1996, 1997, 1998, 1999, and 2000 per Beck study. i) uw ~) 10. ALLISON LAKE ASSUMPTIONS Inflate Solomon Gulch power cost at rate of inflation for O&M component only. Assume reduction of 1.5 operators in 2000. Assume diesel units added in 1996, 1997, 1998, and 1999 per Beck study. Assume Beck cost of power analysis as to project cost ($46.6 million). Assume 50-year life for depreciation. Assume 5%, 35-year loan. New diesel O&M $.01 per kwh plus $12 per kw. New diesel cost $1,112/kw in 1992 dollars, interest 5%, 20-year life, no salvage for depreciation. Capital cost is escalated to year of acquisition using 3.5% inflation rate per NC Machinery. Glennallen and Valdez maintenance on old units set at $50,000/year each plant in 1994 dollars. Indexed to inflation. Reduce maintenance on old units in 1999. Assumed Allison Lake maintenance of $284,000 in 1993 dollars. Ny Ww be wn INTERTIE ASSUMPTIONS Project Cost : $53.8 million per Beck cost of power analysis. Project Finance State loan 50-year, 0%, $35 million REA loan 35-year, 5%, 18.8 million Assume two standby diesel operators are retained. Assume diesel O&M $100,000/year in 1995 dollars indexed to inflation maintenance requirements reduced on old units in 1998. Assume 50-year life, no salvage for depreciation. Assume intertie O&M per Beck study. % 4 4 ‘ 1! w t ny "e iF ' } i ' i} & * 4 : | : { \, I 4 ‘ i ee fy ' 4 le ro { SUMMARY OF COST ‘Or POWE R ANAL YSIS MEDIUM LOAD-HIGIL FUEL YEAR 1998 1999 2000 2001 2un2 2005 2004 2005 2006 2007 SUPPLEMENTARY MAWIE REQUIRED 37,100 37,711 38,330 39,063 39,794 Madd 41,067 ANGRR 42,309 429M OST OF TOW VALUE: BP. COST OF TOW SOVARD SO.1618 $0.1767 SO.1780 $O.1791 30.1826 SO.1B17 SO.1R65 SO.1RKG $0.1879. ALLISON LAKE POWE ST 50.1489 SO.1478 $0.2172 $0.2151 $0.20 $0.2116 $0.2074 $0,2090 50.2078 $0.2037 INTER TIE— NON-FIRM---NON-INTEGRATED 50.1156 $0.1152 SO.1147 SO.L142 SO.LIG) SO.1I34 50.1132 SOAUSL 50.1130 50.1126 50.0758 50.0770 $0,0783 30.0795 50.0837 $0.0855 50, 0852 FIRM--INTEGRATED 50.0868 INTERTIE: 1, VALUES E) Z DIESEL. CASE $5,525 56,175 $6,772 $6,952 $7,139 $7,384 $7,462 $7,775 $7,920 $8,068 ISON LAKE $5,525 $5,574 58,323 $8,401 $8,480 $8,519 $8,711 58,791 $8,747 ERCTIE-NON-IN LEGRATED 34,289 $4,342 $4,397 54,649 SA,714 $4,781 $4,835 INTER TE-INTEGRATED 52,814 $3,000 $3,437 $3,553 $3,672 $3,671 ANNUAL SAVIN . (ALL VALUES EXPRESSED IN $'S ANNUALLY [000}) INTERTIE TO DI $1,235 $3,270 $2,374 $3,845 $2,520 $4,088 $2,813 $4,222 $3,199 $4,397 INT! ERTIE TO ALLISON LAKE $1,235 $1,232 $3,926 $3,942 $3,862 33,971 $3,870 $3,997 | $4,010 $3,912 $2,711 $3,270 $3,771 $3,845 $3,922 54,058 $4,024 $4,222 54,308 $4,397 $2,711 $2,669 $5,081 35158 $5,119 $5,263 35,231 $5,077 MEDIUM LOAD--LOW FUEL YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 SUPPLEMENTARY MAVIE REQUIRED 37,100 37,1 38,330 39,063 39,794 40,441 41,067 41,688 42,309 42,934 (ALL VAL! UES EXPRESSED IN S'S ANNUALLY [000]) DIESEL CASE 50.1381 50.1530 50.1656 50.1666 50.1677 $0.1706 50.1693 50,1738 50.1756 SO.174S ALLISON LAKE- 50.1381 $0.1370 $0.2137 $0.2114 $0.2092 $0.2074 $0.2030 50.2013 $0.2029 S0.1986 INTERTIE--NON-INTEGRATED SO.11S6 50.1152 SO.L1A7 50.1142 SO.1161 SO.LN34 $0.1132 SONIA $0.1130 $0.1126 $0.0770 INTERT 30.0837 50,0852 $0.0868 50.0855. danse dea SPAN TALU EC UALCLUNL USN MOCAITSEELNOCCCCLLEAALULIOOUDAOCOADITCOULELEIDCUDDDOCAIDLCOUUDDLDOLLIVOCYUUILCESDCCLOSCONOELOUIECCCULCACUCCUITO SIAN CUICAISALCTOOCOISOC COOLEST CODON TASTE OEE DEUCE ANNUAL COST OF (ALL VALUES EXPRESSED IN $'S ANNUALLY [000]) a DIESEL CASE $5,122 55.169 $6,347 $6,507 $6,955 $7,429 $7,492 $5,122 $5,167 $8,191 $8,257 SR,S85 $8,527 $4,288 S432 $4,397 S4459 $3,107 ANNUAL SAVINGS NON INTEGRATED INTE ns 1. VALUES EXPRESSED IN $'S ANNUALLY [000]) S834 S126 $1,950 $2,048 $2,055 $2,312 $2,306 $2,532 9 ANNUAL, SAVINGS A (ALL VALUES EXPRESSED IN S'S ANNUAL, 1. [000]) $2,309 $2, $3,456 $4,571 $3,517 $3,691 $4,901 5 INTER TIE TO ALLISON LAKE ' Hote bee ba? g fill bea pa F { 2 ' : & ie : Pi ‘ 1 1 : . . SUMMARY OF COST OF POWER ANALYSIS MEDIUM LOAD-IIIGIE FUEL YEAR SUPPLEMENTARY MAVIE REQUIRED 43,566 44,206 2008 2009 2010 zon 2012 2013 2014 2015 2016 2017 ARS 45,510 46,175 AG,8AT 47,317 48,192 48,871 49,555 iirc mmnnannnmncnnioncnnnnnnnnininsirnimmninnvennininnninanninninninninnaeatiiintnis Freon esceee aca aeT SoS ASS (ALL VALUES EXPRESSED IN $°S KWI) DIFSEL EXP. COST OF POWER SU.IR7S 0.1899 -S0.1927 0.1956 SO.19RG = $H.2018 —$0.2051 50.2085 $0,.2092 «$0.20 ALLISON LAKE POWER COST $0,200 $0,190 SO.19RF—SO.1978— SUITE SO.1971 50.1969 $0,1967S0.199B— SOLLDTT INTERTIE+-- NON-FIRM---NON-INTEGRATED $0,107 $0,1079-—-$0,1083—S0.1088—$0.1139 —$0.1107—SOLNTIY —S0.NI2TS0.tt29 $0,149) TRE RECT Te soe HCA CIN TSCA TE oe ocerpperresaee roneonanrses iv ax IR aeRO oc AN oe oman eam a OS a oe Or ee ee meee eaaiiie ie mecca sanasei = — (ALL VALUES EXPRESSE! DIESEL CASE SR,16R $8394 SR,G4 $A,900 $9,172 $9,454 $9,746 $10,019 $10,225 $10,419 ALLISON LAKE SH712 «$8,797 $R,R97—— $9,003 $9,117 $9,233 59,355 $9,479 $9,469 $9,470 51,697 51770 S4RS7 SHI S5,258 S51KS $5,293 $5401 $5,520 «$5,095 oom SY, SWEO $3,959 S416 $1,638 $4825 $5,020 $3,222 pean : “ $4,584 $3,784 $4,784 sont $4,997 $4,453 $5,224 $4,706 $8,197 $4,027 $3,949 (ALL VALUES EXPRESSED IN S'S ANNUALLY [000]) INTERTIE TO DIE: $4489 SHS84 $4,683 54,784 $5,224 $4,938 $4,887 $1,654 MEDIUM LOAD--LOW FUEL YEAR 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 SUPPLEMENTARY MWWIL REQUIRED 43,566 44,206 AABS4 45,510 GATS 46,847 47,517 ARN92 48,871 49,555 nr ee eresseeecemeeen tos mecorecesovvore es oe sroecnee ssereeeeneen (ALL VALUES EXPRESSED IN $'S ANNUALLY [000)) . iDIESEL CASE 50,1737 50,1757 $0.1781 50.1806 SO.VRIS $0.1860 $0.1889 su 1919 $0.1921 $0.1927 EALLISON LAKE S0.1946 50.1933 $0,1924 50.1916 $0.1909 50.1903 $0.1897 $u.1892 50.1860 50.1830 jINTERTIE--NON-INTEGRATED S0.1078 30.1079 50.1083 50.1088 SOND $0.1107 SO.LII soui2 $0.1129 SO.LLS9 IXNNUAL COST OF POWER naan 5 " . {ALL VALUES EXPRESSED IN $'S ANNUALLY (000) ~ . : DIESEL CASE $7,568 $7,769 $7,989 $8,220 58,463 $8,715 58,976 $9,247 $9,389 59,548 ALLISON LA $8,477 58,547 $8,631 $%,720 58,816 SKINS 59,015 $9,119 59,088 $9,067 INTERTIE--NON INTEGRATED $1,697 $4,857 $4,919 55,185 55,293 SS.404 $5,520 55,695 $2,871 $2,999 $3,132 $4,271 $3,205 $3,530 53,683 SuRt2 53,869 $3,853 $3,720 $3,777 $3,774 $3,771 $3,557 $3,729 $3,722 SUTES $3,568 $3,372 | ANNUAL. SAV} ALL VALI ERTIE TO Dt u 1 1C ONT $1 Se aed petted onencnse sonnses anon rmecen, paossoos pomweoee seeee aoasonee arcnonee Y ED INTERTIE S EXPRESSED IN $'S ANNUALLY [000]) f. $3,829 $3,959 54 a0 Sitio SanKO $1,258 $4,339 $1422 $4,370 $4,326 — ~~ — canny RAAGE on 4$9 oR 1298 T1068 SARIS ae % ve tt i : eu NAMIE. CHIDSIATE — om ~n BASE CASE - ALL DIESEL MEDIUM LOAD-HIGH FUEL CASE 20 2 22 23 2 a3) 26 27 28 29 30 a 32 33 34 33 %6 ” 3B a” 40 INFLAT. ACTUAL ACTUAL FACTOR 1991 1992 MAW REQUIREMENT | SOLOMON GULCH 39,634 40,880 EXISTING 20,765 21,607 NEW DIESE sGl ‘ LOSSES TOTAL REQUIREMENT y TOTAL LESS SOLOMON 20,765 21,607 FUEL PRICE 2.15% DSL FUEL COST 1,376 1,252 LABOR A&E 84 65 LABOR PRODUCTION 689 750 ADD 3 OPERATORS 0 0 ADD MAINTENANCE CREW 0 0 GDP GENERAL 152 "89 GDP UNITS 109 1 VDP GENERAL 15 162 VDP UNITS 3 288 OTHER 153 173 DSL INTE 220 212 DSL DE 235° 237 NEW D BLDG 0 0 NEW D S O&M scl 0 0 NEW DI S INTERES scul 0 0 NEW D S$ DEPREC secu veel 0 TOTAL COSTS 3,176 3,299 COST PER KWEYSUPP $0.1$29 $0.1527 ACTUAL 199% $2,364 20,548 20,548 1,176 87 R37 0 2is 285 269 89 38 205 244 $0.1676 BUDGET 1994 44,925 28,777 28,777 3,377 SO.1174 FOUR YEAR AVG 4451 22,924 22,924 1,304 79 756 166 162 162 156 o4 205 241 $0.1450 S17 94 129 PN Revised Per inal Study MEDIUM LOAD-HIGII Aueuwne 7 8 MWIT REQUIRE 9 SOLOMON GULCII 10 EXISTING DIESELS 11 NEW DIESELS 12 SGL 13 LOSSES I4 TOTAL REQUIREMENT 1s 16 TOTAL LESS SOLOMON 7 ? 18 FUEL GALLONS 19 FUEL EFFICIENCY 20 FUEL PRICE 21 22 DSL FUEL COST 23 LABORA &E 24 LABOR PRODUCTION 25 ADD 3 OPERATORS 26 ADD MAINTENANCE CREW 27 GDP GENERAL. 28 GDP UNITS 29 VDP GENERAL 30 VDP UNITS 31 OTHER 32 DSL INTEREST 33 DSL DEPREC 34 NEW DIE! 35 NEW DI 36 NEW DIE 37 NEW DIESEL. 38 TOTAL COSTS 39 40 COST PER KWIVSUPP FILE NAME: CHDSEMI FUEL CASE INELAT . FACTOR 1995 1996 1997 1998 1999 2000 2001 2002 2003 20044 2005 2006 49,933 51,012 51,645 51,906 52,169 52,437 $2,606 52,606 52,606 52,606 52,606 52.606 32,715 23,924 15,170 5,176 1,121 1147 1173 1,195 1214 1,232 1,251 1,269 11,300 21,529 32,128 36,795 37,390 38,095 38,799 39,422 40,025 40,622 41,220 201) (202 cemeesanee 204) (207) (205) = (200) (195) (190) = (185) (180). 8 42 $9,006 90,767 91,669 92,400 93,047 94,915 32,517 35,023 36,497 37,100 37,711 38,3320 J9063 39,794 AO AAT AN,067 ALGRS 42,309 2,501 2,694 2,517 2,473 2,433 2,473 2,520 2,367 2,609 2,619 2,690 2,730 13 1B 14.5 15 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 2.75% 0.75 0.771 0.792 o.814 0.836 0.859 0.883 0.907 0,932 0,957 0.984 Lou 1,876 2,076 1,993 2,012 2,034 2,124 2.224 2,328 2431 2,527 2,616 2,159 83 8S 88 90 93 9s oR 100 103 106 = S109 m2 793 R14 837 860 R83 908 9323 _ 958 985 1,012 1,039 1,068 0 0 0 0 342 352 362 371 382 392 403 4nd 0 0 0 0 wi 228 235 241 248 254 261 269 2 217 223 229 235 242 248 255 262 269 2 284 235 241 248 254 0 0 0 0 0 0 0 0 205 2 216 22 228 235 24 248 255 262 269 276 126 129 132 136 0 0 0 0 0 0 0 0 30 31 32 33 33 x 35 36 38 29 40 174 165 155 145 135 124 i 103 80 68 55 247 247 27 247) 247 247 247 0 0 0 0 148 148 las scl 0 151 297 457 554 608 666 scu 0 137 215 413 552 691 666 SCH, 2D. ose wneeedd a a ea 3,979 4,641 5,022 5,525 6175S 6772 6,952 7,139 7,384 7,462 $0.1224 — $0.1225 0.1276 SO.1ARD—«$O.1G3R —$0,1767 —S0.17KN—S0.1794 0.1826 SO URIT —$0.1RGS SOT RKG 5/17-94.11:29 PM 2 , Revised Mer Final Study bE 6 i F of 4 3 t i ' i t et ¢ 0 BASE CASE - ALL DIESEL i q d BASE CASE - ALL DIESEL 1 MEDIUM LOAD-HIGIL FUEL CASE 2 3 4 5 INELAT : 6 FACTOR 2007 2008 2009 2010 2011 2012 2013 2014 201s 2016 2017 7 8 MWIREQUIREN 9 SOLOMON GULCH 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 10 EXISTING DIESELS 1,287 1,306 1,325 134 1,363 1,383 1,402 1,422 142 1,462 1an2 11 NEW DIESELS 41,823 42,431 43,047 43,671 44,303 44,943 45,591 416,236 46,886 47,540 48,199 12. SGL Oe 13 LOSSRS aa escent Deetoreeehs Le Naor ocean (SO) semen C10) atl) Cee easement tele 6126) 14 TOTAL REQUIREMENT 97,460 f 100,798 101,77 102,161 1s 16 TOTAL LES§ SOLOMON 42,904 413,366 44,206 AA,RSA 45,510 46,175 46,847 47,517 48,192 ARTI 49,555 7 18 FURL. GALLONS 2,770 2,811 2,852 2,894 2,96 2,979 3,022 3,066 3,109 3,153 3,197 19 FURL RFFICIENCY 15,5 15,5 15,5 15.5 13.5 15.5 13.5 15,5 15,5 15.5 15.5 20 FURL PRICK 21.15% 1,039 1,067 1.096 1,127 1.158 1,189 4,222 1.256 1,290 1.326 1.462 21 22 DSI. FUEL Cost 2,877 2,999 3,127 3,260 3,399 3,543 3,604 3,850 4012 4,180 4.455 23 LABOR A&E 2.15% us 118 121 125, 128 132 135 139 1a 147 131 24 LABOR PRODUCTION 2.15% 1,097 1,128 1,159 1,190 1,223 1,257 W291 327.1363 1,401 1439 25 ADD 3 OPERATORS SCI AS 4x7 Ado 462 AM ART sor Sta 529 S43 558 26 ADD MAINTENANCE CREW SCH 216 284 291 299 30k 316 325 334 343 352 162 27 GDP GENERAL 2.15% 292 ~ 300 308 317 326 335 344 333 363 43 38) 28 GDP UNITS 2.75% 0 0 0 0 0 0 0 0 0 0 0 29 VDP GENERAL 2.15% 2R4 292 300 308 316 325 334 34a 353 362 an 30 VDP UNITS 2.15% 0 0 0 0 0 0 0 0 0 0 O° 31 OTHER 2.15% N2 43 Pr) 45 46 48 49 so 52 33 54 32 DSI. INTI FINED 42 28 " 5 \ 0 0 0 0 0 0 33 DSL. DEPRI FINED 121 0 0 “0 0 0 0 0 0 0 0 34 NEW DI BLDG 206 206 206 206 206 206 206 206 206 206 206 35 NEW DIESELS O&M SCH 1,064 it 1,222 1,306 1,395 1,487 1,383 1,684 1,789 1,898 2013 S INTERES SCH 491 437 420 382 a2 300 256 210 162 Ww 6k 37 NEW DIESELS DEPREC scul 126 736 136 136 136 TG 186 736 736 598 38 TOTAL. COSTS 8,068 8,168 8,641 8,900 9,172 9,746 10,019 10.225 39 : 40 COST PER KWIUSUPP 50.1879 -S0.1875 S0.1899 —$0.1927S0.1956 80,1986 = $0,201 $0.2051 = $0.208S~—$0.2092 $0,210 WILE NAME: CHDSLMIL $1794 11:29 PM Revised Per inal Study st ADD 3 OPERATORS. ADD P MART CREW ADD E MART CREW EW DIrse. UTS VAR MAINT EW DIESIS IDCMAINT NEW DIES S: MSTALID KW CUBA. DISTAL KW COST PER KAW BISTALIID) TOTALTOR 21390 KW INSTALL. MEW DITSNS CUMUL RISTALLED COST DEFRECUTION PER tna CUM DrrArcuanion MITEREST EXPOSE 1996 ADDITION: 1997 ADDITION ADDITION: 1999 ADDON 2000 ADINTION: TOTAL O/T NEW DSL EW DITSH, DUU.DeIG 1999-2009 2004.2017 MEW DLO COST PER CPA NEW DIESAL. KITE REQUIRE, DIES. CAST (ATSEL. CAST. NENW DIFSTLS XD) MAINTT NANCE VARIADLE MADIT TOTAL NEW DSL. MART File Here BAT LISL. Hl -" a ons 0273 0.0100 120000 aay 126,000 197,000 209,005 29463 orgie 307,223 SCHEDULE OF INFLATION DIESEL EXPANSION CASE StS074 oor 13.0073 2130 2130 276 2,743,699 2,743,699 2,745,009 linia 136.683 170313 DISS, eon 13.3738 2130 4300 a 2009.78 209,71 140,442 174,996 24,329 36099) STATS, 381,690 399,279 Sao 129.911 " eons omss 13.7495 16.0727 ne 19550 2,999,108 8,522,314 14,213,997 94,752,957 14,782,937 14.0297 753,607 133.607 793.007 109,403" nme 122098 70,518 I9z380 136.340 TRANS WAA273 148,275 new 795 37390 38,095 38299 39,422 534454 on Revieed Fee basal Sow, 1 ot f t ! } f p3 i { } : i i : ; 4 a f + ot i fis | | ' i i ‘ SCHEDULE OF INFLATION DIESEL EXPANSION CASE ' 2 RAITOF ’ JRATIATION 3 03, a : S ADDS OPERATORS AVaose Ae 4d 46S) aya ARS ‘ 7 BADD DE MAINT CREW HOSTED TSAR 166.RRD 9 ADDL MAINT CREW .. MNT pees ' ISACOR ee ce ee HOORRD . W686 NBL 299,400 D6? 353,76) sn 36306) 12 MEW DITsH.Unats VAR MAINT NEW DITSELS Oo io OO16) oon oot? oor 192 TUX MAQTT MEW DIELS soe 90S 2619 Thal 229 zeny INSTALLED KW ze 390 2190 2130 11390 190 CUA, ISTAUITID KW Tsang 27090 32rse sassy 40nso 4510 ation COST PER KWASTALID waa 2,066 le ase ase rem TOTAL FOR THO KW 4,005,702 4 AANA AS96ONG Je 3,096,972 SAMO SOA 20 BISTAI HUW PHESTIS 2b CUAL BISTALL ED COST 14702997 W470 997 PATE 9OT 14957 290 AATEONT TATHDONT HATER Wa7he nD 2) DEFRANCO TION IER nar a) cunnanopt WS O07 TING TNSON7 7560 1NS,607 TNS O87 TaSat TNSONT TSS64T TeSenF 4a ™ 24 BITREST IOI, che 4 ADDIE TION S008 TA 1o4et . oh] 1 ADOT HON ote thes 19 LOPE ADEE 1019146 . 2 30 199 ADM HHOR Aas 31 200 ADOTNKON Viaen 32 TOTAL BAL MEAT OSES . ” J EW DIES. NUM Ma 33 1999-2008 ’ 36 201.201" 37 MEW NO COST PER CPA ly 39 DAW DIESE. KNEE QUIRE, 40 DIESTL CASE 44220 Anas a 42 DIET. CASE NEW DIESELS. : 4) FX MAMITHANCE 405,809 432.693 41 VARIADLE MAQIT vee ee SOS SUNS. 48 TOTAL MEW DSL MADIT 90,314 Vogion 1n9,277 293003, 203. 222.799 263 ange Ass 46,296 46ARG 47,349 an ROOSNG MAD NORS8T9 "1 ano. TAR ASS sate 28) Renjeed Fer Pyrat Study Pier Vite Phaene BALI, . FILE NAME: CHALLMI Aweune 7 8 MW REQUIREMENT 9 SOLOMON GULCII 10 EXISTIN lt NEWDI 12, ALLISON LAKE 13 LOSSES 14 TOTAL REQUIREMENT 1s 16 TOTAL LESS SOLOMON 7 18 FUEL GALLONS 19 FUEL EFFICIENCY 20 FUEL PRICE 21 SOLOMON GULCH RATE 22 23 24 DSL FUEL, COST 2S LABOR ARE 26 LABOR PRODUCTION 27 GDP GENERAL 28 GDP UNITS 29 VDP GENERAL 30 VDP UNITS 31 OTHER 32 DSL INTEREST 33 DSL DEPREC 34 SOLOMON POWER COST 35 ALLISON INTEREST 36 ALLISON DEPRECIATION 37 ALLISON O & M 38 NEW DIESELS O&M 39 NEW DIES a 40 NEW DIESE 41 TOTAL COSTS A2 43 COST PER KWIVSUPP 2S DEPREC ™ ALLISON LAKE MEDIUM LOAD-HIGI FUEL CASE INFLAT FACTOR 2.75% 2.75% 2.75% scU SCI SCH ACTUAL ACTUAL 1991 1992 39,634 40,880 20,765 21,607 60,399 62,487 20,765 21,607 0.064 0,064 1,376 1,252 Rd 65 GRO 750 152 109 $0.1529 $0,1527 | ACTUAL 1993 $2,364 20,548 72,912 20,548 0.064 1,176 87 837 214 285 269 89 38 205 244 0 0 2 50.1676 BUDGET 1994 AA,I25 28,777 28,777 0.066 1412 79 TAB: 208 184 in 162 13 183 247 ceooco SO.VITA FOUR YEAR AVG 44451 22,924 22,924 0.0645 1,304 19 756 166 162 162 136 o4 205 241 0 0 a 0 0 0 $0,1-4150 S174 11:06 VM Revised Per Final Study Auwnuwne 7 8 MAI REQUIREMENT 9 SOLOMON GULCH 10 EXISTING DIESELS 11 NEW DIES: 12, ALLISON LAKE 13 LOSS 14 TOTAL REQUIREMENT 15 16 TOTAL LESS SOLOMON 7 ‘ 18 FUEL GALLONS 19 FUEL EFFICIENCY 20 FUEL PRICE 21 SOLOMON GULCH RATE 22 23 24 DSL FUEL COST 23 LABORA XE 26 LABOR PRODUCTION 27 GDP GENERAL 28 GDP UNITS 29 VDP GENERAL 30 VDP UNITS 31 OTHER 32 DSL INTERES 33 DSL. DEPREC . 34 SOLOMON POWER COST 33 ALLISON INTEREST 36 ALLISON DEPRECIATION 37 ALLISONO & M 38 NEW DI 39 NEW DI 40 NEW DI 2S DEPREC 41 TOTAL COSTS 42 43 COST PER KWILSUPP ! MEDIUM LOAD-IIIGH FUEL CASE INFLAT FACTOR 2.75% 2.75% 2.75% SCII SCI sc 1995 AO9IN 32,715 32,517 2,501 13 0.75 0.067 1,876 83 793 2u 235 205 126 30 174 247 $0.1224 1996 51,012 23,924 11,300 35,023 2,694 13 0.771 0.067 2,076 85 814 217 21 2 129 31 165 247 $0.1325 $0.1376 b , ‘ ALLISON LAKE 1997 1998 51,645 51,906 15,170 5,176 21,529 32,128 89,006 36,197 37,100 2,517 2,473 14.5 15 0.792 0.814 0.068 0.069 1,993 2,012 88 90 837 R60 223 229 248 254 216 222 132 126 32 33 155 15 247 247 0 0 0 0 0 0 0 0 457 413 4 SO.14R89 "3,525 1999 2000 52,169 $2,437 4121 0 36,795 11,935 26,715 50.1478 205)” 89,880 90,767 37,711 38,330 2,433 770 15.5 15.5 0.836 0.859 0.070 0.071 2,034 661 93 95 B84 757 23s 242 oO: 0 228 235 0 0 33 a4 135 124 247 247 « 0 . 943 0 2,329 0 932 0 343 534 269 $52 833 $374 «323 $0.2172 2001 52,606 0 12.651 26,715 39,053 816 15.5 0.883 0.971 $0.2151 in MO aca 91,669 2002 52,606 0 13,363 26,715 39,794 862 15.5 0.907 0,072 782 100 799 255 248 0 36 103 247 966 2.276 932 363 302 493 8,480 $O.2131 2003 52,606 0 13,994 26,715 93,047 40,441 903 15.5 0.932 0.073 BAL 103 821 262 255 37 92 247 978 2,248 932 373 319 471 8,557 $0.2116 268) 2004 52,606 0 14,604 26,715 93,673 41,067 942 15.5 0.957 0.074 902 106 844 269 0 262 0 38 80 247 990 2,218 922 383 36 3M 378 . <si9 evens enon $0.2074 ae os 2005 52,606 0 15,209 26,715 94,294 41,688 981 13.5 0.984 0.075 $0.2090 (236) 2006 $2,606 0 15,814 6,715 , 224) 94,914 42,308 1,020 15.5 1.011 0.076 1,031 112 891 284 0 276 $0.2078 1794 11:06 PAE Revieed Mer Final Stale aj a q ik ‘a q ot 9 3 ‘ ’ ' t 4 ii i ; ‘ 4 { i : 74 : ; i ' ALLISON LAKE ' 1 MEDIUM LOAD-IIGH FUEL CASE m 3 4 5 INFLAT 6 FACTOR 2007 2008 2009 2010 2011 » 2012 2013 2014 2015 16 2017 7 8 MWIE REQUIREMENT 9 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 52,606 10 0 0 0 g 27 47 67 86 106 126 146 iu a 16,424 17,040 17,663 18.291 18,923 19,563 20,212 20,857 21,506 22,161 22.819 12, ALLISON LAKE 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 13 Loss veenneMOSD MBI) TB I 86 ISO ADO I 126) 14 TOTAL REQUIREMENT 95,540 96,172 96,811 97,459 98,115 98,780 99ASA 100,123 100,797 101,477 102,160 1s 16 TOTAL LESS SOLOMON 42,934 43,566 AA,205 AA,BS3 , 45,509 AGATA AG BAR AT,SA7 AR,191 ARB71 A9,SS4 7 18 FUEL GALLONS 1,060 1,099 1,140 1,181 1,223 1,265 1,208 1,351 1,394 TAs 1,482 19 FUEL EFFICIENCY 15:3 15.5 SS) 15:5) 15.5 15:3 13:5 1S:S) 13:5) 15.5 15.5 20 FUEL PRICE 2.75%. 1.039 1.067 1.096 1.127 1.158 1.189 1.222 1.256 1,290 1.326 1,362 21 SOLOMON GULCH RATE 0.077 0.078 0.079 0.080 0.081 0.082 0.084 0.085 0.086 0.087 0.089 22 23 24 DSL FUEL COST 1,101 1,173 1,250 1,330 LAs 1,505 1,599 1,697 1,799 1,906 2,018 25 LABOR A&E ms 118 121 125 128 132 135 139 143 147 15st 26 LABOR PRODUCTION 915 940 966 993 1,020 1,048 1,077 » 1,107 1,037 1,168 1,201 27 GDP GE RAL 292 300 308 317 326 345 add 353 363 373 383 28 GDP UNITS 0 0 0 0 » 0 0 0 0 0 0 0 29 ¥DI GENERAL. 284 292 300 308 316 325 334 343 353 362 372 30 ¥DP UNITS 0 0 0 "0 0 0 0 0 0 0 31 OTHER 43 ad 4s 46 418 49 50 32 53 34 32 DSL INTI 28 ny 5 1 0 0 0 0 0 0 33 DSL. DEPREC 0 0 0 0 0 0 0 0 0 0 34 SOLOMON POWER COST . 1042 1,056 * 1,070, 1,085 1.100 1,116 35 ALLISON INT! ist 2,083 2,045, 2,005 1,963 1,919 1,872 36 ALLISON DE 932 932 932 932 932 932 37 ALLISONO & M 2.15% 427 AMS 450 AGS 476 A89 38 NEW DI scl aut AQ2 454 477 500 525 39 NEW DI SCI 345 aS 285 253 219 183 40 NEW DI SCH 7 SR ae STE STB ee STR cee ST, 41 TOTAL COSTS 8,797 8,897 9,003 Sth? 9,23 A 43 COST PER KWIUSUPP $0.20)7 $0.2000 so.1990 SO.19K4 SO.19TR SO.974 soe $0. 1969 $0.1967 SOLLIAR SOOT $1794 1106 DD VILE NAME: CULALLMIL . 3 Revised Per Final Study ii 4 ALISON LAKE MART # SOLOAION OUL.CH RAITT. yoann © DENT STRVICE 1 TOTAL SOLOMON RATE. 2 ’ 4 MEW DITSEL. UNtTs: 3 VAR MADIT NEW DITSHS. 6 FOCMART EW DISS 7 DISTALIZD KW © CUMUL PISTALLED KW 9 COST PER KW INSTALLED. © TOTAL. FOR 1130 KW ' 2 PISTALL MEW DISS 3 CUMIN INSTALLED COST " 19 DEPRECIATION PER UNTT 16 CUMAA, DErRTCATION ” 18 DATTANST EXTONSE 19 L996 ADDITION 10 1997 ADOTION " ADDITION 121999 ADDITION 1) TOTAL BYE MEW DSLS “ 13 NEW DITSEL BUT. DOG MEW WLDG COST FER CTA Ww 10 PEW DISEL KT REQUIRE ALLISON LAKE, a 4) ALLISON LAKE NEW DIESELS 44 FIXED MAPNTOANCE 43) VARIADLE MAINT 46 TOTAL MEW DSL MAINT 32 R ¥ RATE OF 0273 0.0100 12 0090 wot 2474490 ones 126691 133,025 163,734 SCHEDULE OF INFLATION yon.ono oor O64 150,569 06100 ALLISON LAKE 316,932 on 193939 230 4300 LAL ORG 279,170 140442 174,996 329298 13.7493 130 6130 2.93) 8,522,314 146.993 146.993 a6 Maser 179,008 0 AH00 any fousr sHe8 0108 e100 09706 a400 1468 Naas Sums 149,093 1161 a91 S7KI2S nae 7. 385387 361999 p20 0.0100 13.30K6 oe aout 98 600 tome 390.708 Ja4a1 378.229 tos.403 W378 199,962 ate ait SAL ISS on 0.010 oom a” aura? s409 1,6n0 seuasia thse, 378,229 201992 203,929 War! 4709.04 isenay ' 2 , 4 3 ALLISON LAKE MAQIT ‘ ’ 1 SOLOMON OULCH RATE: OAM 19 DEBT SERVICE IL TOTAL SOLOMON RATE, n ” 140 MEW DIPS. UT, 19. VAR MADYT NEW DIESELS 16 FOCMAMNT EW DAESID. 17 BBTAULED KW 18 CUNT, DYSTALL.E) KW 19 COST PEA KW RISTALIED 20 TOTALTOR 2130 KW " 22 DISTAL MEW DITsr Ls 2) CUMPUL YSTALLED Cost " 2) DEPRECIATION PTR OMT 26 CLARA DITKEAATION ” 20 MATINEST EXTINSE 29 1996 ADDITION 20 1997 ADDITION 311998 ADDTION 321999 ADDIIOR Vb TOTAL O41 EW DSS ” 39 NEW DIST. BUILDING 36 1999-2008 ” 38 MEW BLDG COST PERCHA ” 40 NEW DIESIT, KWIT REQUIRE 41 ALLISON LAKE a 4) ALISON LAKE NEW DIESTLS: 44 FOOD MARI IEANCE, 49) VARIADLE MAINT 46 TOTAL MEW DS1, MARIT 0.0273 CO) 0.6100 00275 n 00275 Heme R600 11,361,491 37H 229 00273 0.0275 426,633 49097 430,401 462,798 473, ARE,6U 0.0)70 eos oosm O01 ood oor 0.0160 vaca £0100 oor 100 00770 tone SCHEDULE OF INFLATION ALLISON LAKE 330.059 541,606 0.0146 oors 018) oor 00177 oo: ise tagaat 19.0013 19.3348 2061 mane 21.7962 1400 n600 600 600 1600 nano aon ro) nAo0 as 4928 1,996 ae ay 2.370 249) 4,005,102 4,143,903 4,291,009 49 AIS AION 3,096,372 S204, 748 S61A91 1136149 AIL 11,364,491 11364491 14,364,491 1136) sean 136A 364A STAI 318,229 3722s 374,225 378,225 378,225 +o 43,697 y3Ni3 wrist 199.830 205,326 229333 993 255.812 203. 9.929 taaze 1.010 17,665 14923 19.963 31,308 ison7e 193,029 ° oe ' | 298.978 272.630 7 3773s ase ivns96 431,926 435,058 s33.3m dra 1 oo § # | 8 MEDIUM LOAD-TIGHL FUEL 30 YEAR, ZERO INT. LOAN JS YEAR, $00%5 LOAN TOTAL COST OF LINE INFLATION ADJUSTED POWER COST CUNF 1988's (KID? POWER COST--FIRAII998 S's (KIDS WHEELING TO MEA (CASE 1-- NON-FIRM--MEDIUS POWER COST (KWIN) SUPPL. KWH REQ. DEPRECIATION [ANNUAL INTEREST SUNTOTAL DENT SERVICE DENT SERVICE COST KWIT LINE OAM EXPENSE STANDOY LADOR DIESEL = + DIESEL PLANT OAM SUUTOTAL LINE OF, COST LINE OP, COST KWIt RESIDUAL INTEREST DIESEL RES, DEPRECIATION DIESEL. SUNTOTAL COST LESS PC. COST, LESS POWER COST KWIT POWER COST TOTAL COST OF POWER ‘OF POWER K COST OF POWER (KWH) ‘COST OF SUPP, POWER ISTANODY LANOR DIESEL. DIESEL PLANT OAM RESIDUAL INTEREST DIESEL RES, DEPRECIATION DIE: TOTAL POWER COST lone cost KWH *** ANNUAL SAVINGS FIRAT-MEDIUM LOAD.-CINTE z : ct ie 4 | { i ot [ rr | u Mi r ‘ INTERTIE NON-INTEGRATED CAPACITY LEASE OR ECONOMY ENERGY AND INTEGRATED FIRM ENERGY cost ANN PAY. $700,000 7,29), $149,797 . 102.7585 $0035 90.0% PMR WH a. er... ane? 50.0350 $00160 50.0180 $0011 $o.on $0012) 37,100,000 37,711,000 39,063,000 39,704,000 0,414,000 41,067,000 41,692,000 : $1,076,3:10 $1,076,510 $1,076,510 $1,076,310 41,0 . 494 | M96R SRY, 260 $1,996,514 §1,985,0\C2y_) 41,972,908 $1,900, 300 0.0311 00508 - 00196 Ooms $250,290 $257,173 $159,286 $271,512 52.41,825 52.18.4175 $255,308 $262,029 es 2... SUES! $191,165 sss $7,609,552 $2,115,917 $2,625,306 SOE 0.0681 0.0669 0.068? 0.06.19 0.06.10 00632 $124,399 $113,992 $103,177 591,899 $79,871 $67,671 _.., $117,000 $217,000 $217,000 $2,961,045 9.19, 786 0073) 00708 1,621,060 $4,983,205 * OU MILL FOR WHEELING (MEA LETTER) © NASED ON INFORMATION PROVIDED BY CHUGACH (DECEMBER 1993) COMPARING CASE | TOCASE 2 *°* SAVING! COLE MAME: PRI Mt 300875 300591 $2,169,291 $2,266,160 $295,353 ‘S24nRIS S117,676 $120,913) ‘$135,187 SUD $217,000 310,390, 180. ZA 2.242,207 é ® 733,705 + $0.0607 $2,373,008 S2ANATS Sita $113,992 $3,106,713" 00795 $0 0624 $2,199,893 $258,008 $127,651 $103,177 ont sooo 30 0659 300677 $2,591,696 $2,706,275, $2,822,747 $262,929 $269,341 $276,986 $11,165 $131,772 simak 579,871 $07,671 $247,000 Sy sin Revised 2006 SOONS 42,309,000 $1,076,510 SR 1NNIG “Shoinvee 0018) SIONS) $281,972 $54,971 $247,000 NIU 00695 $1,839,736 $0066 $290,877 S2R1572 ‘S142, 286 VEO a ‘val Stony ' myo: Uk oat ‘ ' ' \ ; ' goad fee fat tory INTERTIE NON-INTEGRATED CAPACITY LEASE OR ECONOMY ENERGY AND INTEGRATED FIRM ENERGY 1 MEDIUM LOAD-INGH FUEL 2 cost AUN PAY. 3 $0 VEAR, ZERO INT. LOAN $35 MILLION $700,000 4.35 YEAR, $ 00% LOAN S183 MILLION eae $UVMI9,797, . 3 TOTAL COST OF LINE, $39.8 MILLION $1,819,797 6 7 INFLATION ADJUSTED 102 75% 8 POWER COST CLINE 199R$'s (KWIL)* 5003s 9 POWER COST--FIRM1998 S's (KWH? $0056 10 WHEELING 10 MEA PMILA RWI fe — = La Lee) Ee eecanner ee eae a my 52016 ee eneeomeemen NCASE 1-- NON-FIRM--MEDIUM LOAD-. (NOT INTEGRAT 1) POWER COST (KWIN) $0.0.159 $00172 $0.0.185 $0 0198 sonsi $0526 $0.0510 $0 0353 soon J4}SUPPL. KWH REQ 43,366,000 11,206,000 31,000 45,510,000 46,178,000 46,817,000 41,817,000 4,192,000 49,595.01 |3]DEPRECIATION $1,076,510 $1,076,310 $1,076,310 $1,079,810 $1,076,510 510 I6]ANNUAL INTEREST . sn 1: $737,086 SO9Q7RD $672,099 |SUDTOTAL DENT SERVICE $1,886,799. $1,851,996 R616 $1,771,325 7 51,748,573 IS]DENT SERVICE COSTKWH , oom 9012) oon) ony oom) oo oom ois) ISILINE OAR EXPENSE $11,986 $11,116 $350,196 $360,135 $.112,903 $24,298 SINS925 $417,913 1015 TANDBY LADOR DIE $300,139 530%, 701 $317,190 $325,918 $144,085 $353,317 $163,270 $173,259 HIDIESEL PLANT OAM __ $154,350 $158,395 $162,956 SPTNOND $076.774 SIRENS 816,690 SUBTOTAL LINE OP. COST $ 7g ee §2.n05,295 $2,722,001 $2,725,907 $2,729,102 $2, $2,790.72 HJLINE OP. COST KWH 0.0605 0.0589 00827 0.0581 0.0574 0.0566 0% LJRESIDUAL INTEREST DIFSEL. $10,723 $612 $201 ISIRES. DEPRECIATION DIESEL. '§2F95907° °° $2,739,402 $2,737,4R6 $,790,72 I6|SUBTOTAL COST LESS PC.» "$2 697,339 Samos ang” DICOST, LESS POWER COST KWH 00619 0.0607 ooo 004)7 005m 0 0%n4 00559 ow 1s POWER COST “ceceee, $2,000,019 $2,266,311 $2,362,765 $2,367,003 $2,673,061 $2,787,355. $2,901.07 19] TOTAL COST OF POWER ab 69 San9.07 psa a Tee" 55,519.00 41RD NICASE JUCOST OF POWER (KW 30.0795 $00755 30.0775 + 500797 sooxte sOORI $0 OR! $0 O8RR $009) SJCOST OF SUPP POWER $3,200,030 $3,336,333 $3,178,333 $3,626,258 SACRO $1,9.10,917 $1,107,205 $1,280,102 $1,646,51 JaISTANDDY LABOR DIESEL $300,139 $303,701 $317,190 $225,913 SUK $311,085 $393,517 $303,270 $MM JS{DIESEL PLANT OAM $150,219 $151,350 S1SR,395 $162,986 $172,012 $176,774 $181,635 sagtne JGIRESIDUAL INTEREST DIESEL $27,286 $10,723 $4,599 3612 vires. DEPRECIATION DIESE! JRFTOTAL POWER COST JOTOTAL COST KWIL tof “$182 4,006 $9,678,574 SAR1O107 a 1) TOTAL SAVE FORSTUDY PERIOD 11 *HASED ON MLAP AID CASE (MLAP LL 'S 0 MILD FOR WHEELING (MEA LI 16 ** BASED ON INFORMATION PROVIDED BY CHUGACH (DLCEMIER 199) SAVINGS COMPARING CASE. 1 TO CASE 2 ER) SPWORTTAL PM Re ~ Vawal 5 ENA wernt DNTERTIC MAINT DITLATED DECK MUAMERS PITEAII: MAGIT PER CPA RATE OF 199. 199.753 227,078 393,313 246,600 1993. past 297,723 293.922 a SCHEDULE OF INFLATION 1996, SM 305.911 239,738 SISI07 INTERTIE 1997, 230,727 349d 24690 385,639 267,309 299,005 1998, 199 243,391 aay 160,066 407,162 Ia7A24 346,331 243,991 7D 330,391 274,566 AZIRGL 29R0TT rKAa! sons 20 ens 166 SARS 208 Raa! Sav ener ate Revived Ver Eat Sots SCHEDULE OF INFLATION INTERTIE ' 2 ‘ ’ 4 3 6 eneATE ant 7 BATLATED NECK NURI 302.61) 310.955 ' anne? 423.620 ’ , Sas Vo 319,761 SH08t " setae 360.328 ans 2 303,290 393,26 401,092 413200 An8,s99 ” 14 TR TIE, MARIT PER CEA ane 334986 TAI 350,496 340,133 S956 Th 424298 119.928 seven aerat Rexavest Pee Final Stood Vite taene MA LNG, . ak PRP PPR EP RP AE RE RE Rw, BASE CASE - ALL DIESEL 1 MEDIUM LOAD-LOW FUEL CASE 2 3 4 . 5 INFLAT ACTUAL, ACTUAL ACTUAL BUDGET 6 FACTOR 1991 1992 1993 1994 7 : 8 MAVIE REQUIREMENT 9 SOLOMON GULCH 39,634 40,880 52,364 44,925 AA ASH 10 EXISTING! 20,765 21,607 20,548 28,777 22,924 HL NEW DIESELS 12 SGL oir 13 LOSSES Sener ceeseescsccones: seeeseneseseseess 14 TOTAL REQUIREMENT 60,399 62,487 72,912 1s . 16 TOTAL LESS SOLOMON 20,765 21,607 20,548 28,777 22,924 7 18 FUEL GALLONS 19 FUEL EFFICIENCY 20 FUEL PRICE 2.75% 21 22: DSL FUEL Cost 1,376 1,252 1,176 1,412 1,204 23 LABOR A&E 84 65 87 79 19 24 LABOR PRODUCTION 689 750 827 748 736 25 ADD 3 OPERATORS 0 0 0 0 0 ‘ 26 ADI) MAINTENANCE CREW 0 0 G 0 0 27 GDP GENERAL 152 “89 24 208 166 28 GDP UNITS 109 n RS 184 162 29 VDP GH 15 162 269 M1 162 30 VDP UNITS 83 - 288 89 162 136 31 OTHER 153 173 38 13 4 32 DSI. INTE 220 212 205 183 205 235° 237 24 247 241 0 0 0 0 0 -S O&M scul 0 0 0 0 0 PEREST SCIL 0 0 0 0 0 S DEVREC sci 38 TOTAL COSTS 3,1 39 . 40 COST PER KWIVSUPP $0.1529 $0,1527 80.1676 SO.NI74 $0.1450 S194 VNAS PM FILE NAME: CHDSLML ; 1 . : Revised ler Final Study BASE CASE - ALL DIESEL 1 MEDIUM LOAD-LOW FUEL CASE 2 ; 3 4 s INFLAT 6 FACTOR 1995 1996 1997 1998 1999 7 8 MWIE REQUIREMENT 9 SOLOMON GULCH 49,933 51,012 51.645 51,906 52,169 10. EXISTING DIESELS 32,715 23,924 15,170 5,176 1,121 1 NEW DIESELS 11,300 21,529 32,128 36,795 12. SGL ' 13, LOSSES somerset eben 14 TOTAL REQUIREMENT : 89,006 89,880 1s 16 TOTAL LESS SOLOMON 32,517 35,023 36,197 37,100 347 " 18 FURL GALLONS 2,501 2,694 2,517 2,473 2,433 19 FUEL EFFICIENCY 3 3 14.5 1s 18.5 20 FURL PRICE 2.15% 0.60 0.617 0.633 0.651 0.669 2 22 DSL FUEL CosT 1,01 1,661 1,594 1,610 1,627 23 LABOR A & I. 83 RS aK 90 93 24 LABOR PRODUCTION 793 a4 837 860 883 25 ADD 3 OPERATORS 0 0 0 0 342 26 ADD MAINTENANCE CREW 0 0 0 0 Mm 27: GDP GENERAL 2 217 223 229 235 28 GIP UNITS 235 24 248 254 0 29 VDP GENERAL 205 au 216 222 228 30 VDP UNITS 126 129 132 136 0 31 OTMER 30 31 32 33 33 32 DSL INTEREST 4 165 155 las 135 33 DSL. DEPREC 247 247 2417 27 247 34 NEW DIESEL BLDG 0 0 0 0 148 35 NEW DIESELS O&M sc 0 151 437 534 36 NEW DIESELS INTEREST SCH 0 137 413 ssa! 37 NEW DIESELS DEPREC SCH a 426 STR 38 TOTAL COSTS 3,604 4,226 5,122 5,769 39 . 40 COST PER KWIUSUPP $0.1108 — $0.1207 $0,1267, $0,138} $0,153 “RN 2 “ie 2000 $2437 1147 37,390 90,767 38,330 2,473 15.5 0.687 1,699 95 908 4352 228 242 0 235 $0.1656 2001 52,606 1,173 38,095 91,669 39,063 2,520 15.5 0.706 1,779 o8 933 362 235 248 0 24 $0.1666 2002 52,606 1,195 38,799 "92,400 39,794 2,567 15.5 0.725 1,863 100 958 371 24d 255 248 $0.1677 STO8 TEAS PM Revised Per Final Study 2003 2004 2005 2006 52,606 52,606 52,606 52,606 1,214 1,232 1,251 1,269 39,422 40,025 40,622 41,220 sonnet 93) _ (180) 93,047 93,673 94,294 94,915 40,441 41,067 AL,688 42,309 2,609 2,649 2,690 2,730 13.5 15.5 15.5 13.3 0.745 0.766 0.787 0.809 1,945 2,029 2417 2,207 103 106 109 2 985 1,012 1,039 1,068 382 392 403 aid 248 254 261 269 262 269 277 284 0 0 0 0 255 262 269 276 0 0 0 0 37 38 39 40 92 80 68 35 247 247 247 247 206 206 206 206 788 852 920 900 61d 471 555 524 736 ING. TM. LA 6,898 6,955 ie 29 $0.1706 $0.1693 $O,1738 $0 1756 wn Aue 7 8 MWIT REQUIREMENT 9 SOLOMON GULCIT 10 EXISTING DIESELS It NEW DIESELS 12 SGL 13 LOSSES 14 TOTAL REQUIREMENT 13 16 TOTAL LESS, SOLOMON 7 18 FUEL GALLONS 19 FUEL EFFICIENCY 20 FUEL PRICE 21 22 DSL FUEL COST 23 LABORA &E 24 LABOR PRODUCTION 25 ADD 3 OPERATORS 26 ADD MAINTENANCE CREW 27 GDP GENERAL 28 GDP UNITS 29 VDP GENERAL 30 VDP UNITS 31 OTHER 32 DSL INTE 33 DSLL 34 NEW DIE: 35 NEW D) 36 NEW DI 37 NEW DIE 38 TOTAL COSTS 39 40 COST PER KWIUSUPP BLDG S O&M INTEREST DEPREC FILE NAME: CHDSLMIL BASE CASE - ALL DIESEL MEDIUM LOAD-LOW FUEL CASE INFLAT FACTOR 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 52,606 52,606 52,606 52,606 $2,606 52,606 52,606 52,606 52,606 52,606 52,606 1,287 1,206 1,325 144 1,363 1,383 1402 1,422 1442 1,462 1482 41,823 42,431 43,047 43,671 44,303 44,943 45,591 46,236 46,886 47,540 48,199 42,934 43,566 44,206 44,854 45,510 46,175 46,847 47,517 48,192 48,871 49,555 2,770 2,811 2,852 2,894 2,926 2,979 3,022 3,066 3.109 3,153 3,197 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 2.75% 0.831 0.854 0.877 0.901 0.926 0.952 0.978 1.005 1.032 1.061 1.090 2,301 2,400 2,502 2,608 2,719 2,835 2,955 3,080 3,209 3,344 3484 Ms 118 121 12s 128 132 135 139 143 47 1st 1,097 1,128 1,159 1,190 1,223 1,257 1291. 1,327 1,363 1401 1439 425 437 449 462 474 487 501 sid 529 543 558 216 2k4 291 299 308 36 325 3M 343 352 362 292 300 308 317 226 335 aa 353 363 373 383 0 0 0 0 0 0 0 0 0 0 0 284 292 300 308 36 325 aM M3 353 362 372 0 0 0 0 0 0 0 0 0 0 0 : 42 a3 44 4s NG 48 4 $0 52 33 sa FIXED 42 28 " 3 1 0 0 0 0 0 0 FIXED W201 0 0 “0 0 0 0 0 0 0 0 206 206 206 206 206 206 206 206 206 206 206 scl 1,064 iat 1,222 1,306 1,395 1,487 1,583 1,684 1,789 1,898 2,013 scul SCH, SO.N7AS $0.1737 $0.1757 30.1781 $0.1 806 SO.URA SO.1KO0 $0.1889 $0.1919 50.1921 $0.1927 5/17/94. 11:35 PM 3 : : Revised Per Final Study “ is $ ‘ : ‘ a ' i ; 1 . ‘ SCHEDULE OF INFLATION DIESEL EXPANSION CASE RATE OF 1993 307,225 3.678 IIS 333,279 0 St as7 S619) a7 ADD 3 OPERATORS 00273 391,090 weveene 8 ADD 1 ART CREW 9 ADD I MAINT CREW = ° rast " ‘ 2 MEW DIESEL UMTS 3 VAR MAINT NEW DIT'STS: ooo ono oan Ons oom 4 FOX MADIT NEW DIFSELS 13 0090 1200 tons 199733 43.0433 A202 1a 90R6 3 DISTALIED KW ms 130 2130 6 CURAA, PaTALLED KW ¢ 2130 600 12900 Ws 7 COST PER KWINSTAILED has ws 1a aus tase 4sie ie © TOTALFOR 2190 KW 2474630 2,743,609 SOUL NTT DUAR N16 3,258,641 3.972.604 ’ 0 DISTAL. NEW DITSELS 2,743,409 3,00.977 1 CUMUL BarrALZD COST 2,743,609 #922314 sera 14,712,937 14.702.937 2 J DEPRECIATION PER LAAT wy7tet 146953 132,099 4 CUM DITRECATION wae 426,126 S7R IIS S607 735.600 S607 193,607 135647 se s 6 DOTREST EXrAise 124103 193.083 Masi 192,943 132,099 141,669 192.661 12 TOTAL DIT MEW DMS 43526 4 NEW DIFSE, DUD DING 1999-2003 144.304 179.008 17 MEW BLDO CUST PER CPA ann 19 NEW DIFSEL KITE REQUIRE, TEST CASE 228 36.193 sr 90 38,098 oe ser! 42 DIESEL CAST MDW DIESELS 1) FOC MARIN IANCT: VARIANLE MADIT ’ 13 TOTAL NEW DSL MART 20st 207 Sor 482,004 ” “4 iF} . " " w 20 u n » u“ ’ Ty ” Pty » 30 ” a ” a” ” ao ” a” ” 40 “a az “ay a 4s ADD J OPERATORS ADDL MAINT CREW ADD E MAINT CREW NRW DIESII. nat, VAR MAINT NEW DIESELS 1X MAINT puss INSTA KW CUMIN. DISTAL KW COST PER KAW DISTALIED TOTAL FOR 2190 KW BISTALL NEW DINSTAS CUMIA, STAID COST DIPRROATION PER nay CUMUL DITRECIATION DOITREST EXtINSE 1996 ADDITION 7 ADDITION 1998 ADDINON 1999 ADDTMOH 2900 ADDINON TOTAL DHT HEW OSES NEW DIESTL HUT DDI 1999-2003 2001.20) NEW BLDO COST PER CTA MEW DITSTI. KITE RE QUITE DIFSEL CASE, DINSTA. CASE MEW Dm FIXTD MARIAN VARIADLE MART TOTAL LADY DSL. MAINT Tite Mane MTLDSE RATE OF 90279 ons A405 wasnt 248,61" oon 1r48 30 14,702,997 1867 205,929 41,220 UM t ’ a * t ‘ © yo my 3 SCHEDULE OF INFLATION DIESEL EXPANSION CASE 435,410 437,040 419,161 A205 IRIS 309,613 SHANE 328339 W458 13a 1SR06R 162,018 . cee UE | NSR06R . 299,41 307,675 316137 333,163 verad ose 00150 0.0134 6.0139 o16s 0167 00177 norm? oot oon se ont oangazt 19.0 21909246 The 24.7962 223988 mays se wise ase 10 ave 230 2bs0 aso TM 2yane 27930 39100 322599 S440 sassa sone 43000 asisa nan ioe 1 1,066 za 28 was je 4,003,702 AM43,902 4,291,009 AA 4,996,036 4797908 9,096,972 S274749 3,499,360 5,690,439 VATE 97 LERIPALLE PATENT HAND 9F HATE 9ST IPRI PAL a W4te3g87 14tn39a7 Wace . ' 947 TRI PALL 18807 13617 195617 n3,607 367 W617 THS,61" 795,607 TSN naar 39.084 2 49.327 39.03) see ‘ 277.338 203.929 303,929 Abas 4A ASNT 43.671 AOS stony AS 4626 A6RAE 47,940 AR AOD 492,633 soyete 387916 4,765 76 agate” 798,967 ous 79 594,635 TALON a 2 . Revived Per Fanal Sety tare Bogor € 6 8 € RE a re ee Wh, ALLISON LAKE 1 MEDIUM LOAD-LOW FUEL CASE 2 3 4 FOUR 5 INFLAT ACTUAL ACTUAL ACTUAL BUDGET YEAR 6 FACTOR 1991 1902 | + 1993 1994 AVG 7 8 MW REQUIREMENT 9 SOLOMON GULCH 39,634 - 40,880 52.364 44,925 44,451 to TING DIESELS 20,765 21,607 20,548 28,777 22,924 1 NEW DIESELS 12, ALLISON LAKE 13 LOSSES . — en . = 14 TOTAL REQUIREMENT ~ "72,912 “9402 67,375 Is 16 TOTAL LESS SOLOMON 20,765 21,607 20,548 28,777 22,924 : 21 SOLOMON GULCII RATE 0.064 0.064 0.064 0.066 0.0645 22 23 24 DSL FUEL Cost 1,376 1,252 1,176 1412 1,304 25 LABORARE 84 65 87 79 719 26 LABOR PRODUCTION GRO 750 R37 7A8 736 27 GDP GENERAL. 152 89 24 208 166 . 28 GDP UNITS 109 -1 285 1R4 162 29 VDP GENERAL 75 162 269 Mt 162 30 VDP UNITS 83 288 89 162 136 31 OTNER 153 173 aR rf a4 32 DSL INTEREST 220 212 2s 183 205 33 DSL DEPREC 235 237 aA 247 24 34 SOLOMON POWER COST Oo8 0 0 0 0 35 ALLISON INTE 0 0 0 0 0 36 ALLISON DEPRECIATION 0 0 0 0 0 37 ALLISONO &M 2.75% 0 0 0 0 0 38 NEW DIESELS O&M sci 0 0 0 0 0 39 NEW DIESELS INTEREST sci 0 0 0 0 40 NEW DIESELS DEPREC sci 0 oe O. 41 TOTAL COSTS 3,176 3477 42 43 COST PERK WEUSUPD $0,1529 50.1527 $0.1676 S017 $0.1450 S794 TOA PAT FILE NAME: CHALLML 1 . Revised ler Final Study Auenene 7 8 MWIEREQUIREMENT 9 SOLOMON GULCIL 10 EXISTING DIESELS IL NEW DIESE 12, ALLISON LAKE 13 LOSSES 14 TOTAL REQUIREMENT 15 20 FURL PRICE 21 SOLOMON GULCH RATE 22 23 24 DSL FUEL Cost 25 LABOR A&E 26 LABOR PRODUCTION 27 GDP GENERAL 28 GDP UNITS 29 VDP GENERAL 30 VDP UNITS 31 OTHER 32 DSL INTEREST 33 DSL DEPREC - 34 SOLOMON POWER COST 35 ALLISON INTEREST 36 ALLISON DEPRECIATION 37 ALLISONO & M 38 NEW DIESELS O&M 39 NEW DI INTEREST 40 NEW DI DEPREC 41 TOTAL Costs 42 . 4} COST PER KWIVSUPP FILE NAME: CULALLMIL. . _ MEDIUM LOAD-LOW FUEL CASE INFLAT FACTOR 1995 ADIN 32,715 19 R "82,450 32,317 2,501 13 2.75% 0.60 2.75% 0,067 1,501 83 7193 au 235 205 126 30 174 2.75% SCI scIL sci SO.11OK 1996 51,012 23,924 11,300 86,035 35,023 2,694 13 0.617 0.067 1,661 gS 814 217 241 211 129 31 165 247 $0,1207 201) ALLISON LAKE 1997 1998 1999 2000 51,645 51,906 52,169 $2,437 15,170 5,176 1121 0 21,529 32,128 36,795 11,935 26,715 1 Od 142 89,006 “89,880 36,97 37,100 37,711 38,330 2,517 2473 2,433 70 14.5 1s 15.5 15.5 0.633 0.651 0.669 0.687 0.068 0.069 0.070 0.071 | 1,594 1,610 1,627 $29 88 90 93 95 817 R60 B84 757 223 229 235 242 248 254 oO: 0 216 222 228 2as 132 136 0 0 32 33 33 uM 155 145 1as 124 247 247 247 247 0 0 oO 943 0 0 0 2,329 0 0 0 932 0 0 0 343 $0.1267 SO.UAKT $0.1370 $0.2137 CoE 2001 52.606 0 12.651 26,715 91,669 39,063 816 15.5 0.706 0.071 576 OR 718 QB 0 24 0 a5 ia 247 95-4 2,303 942 353 285 S13 ee 8,257 SoZ m0) a 2002 2003 52,606 52,606 0 0 13,363 13,994 26,715 26,715 ce PBD 268) 92,400 93,047 39,794 40,441 862 903 15.5 13.5 0,725 0.745 0,072 0.073 625 673 100 103 799 821 255 262 0 0 28 255 0 0 36 7 103 92 247 247 966 978 2,276 2,248 932 932 363 373 302 319 493 ant $0,2092 $0.2074 2004 52,606 0 14,604 26,715 A252) 93,673 41,067 942 15.5 0,766 0.074 RO 247 990 2,218 932 383 336 334 R338 $0.2030 2005 52,606 0 15,209 26,715 _ (236), 94,294 ALO88 981 15.5 0.787 0.075 772 109 67 277 19 68 247 1.002 2.187 932 393 Asa 424 518. BSR $0204) 2006 $2,606 0 15,814 26,715 (221) 94914 42,308 1,020 13.5 0.809 0,076 825 112 891 284 276 0 40 33 247 101s - 2,154 932 404 3722 399 378, RSBS su 2029 S794 TEOLINI Revised Mer Final Study ALLISON LAKE 1 MEDIUM LOAD-LOW FUEL CASE 2 : 3 4 ' 5 INFLAT 6 FACTOR 2007 2008 2009 2010 2011 * 2012 2013 2014 2015 2016 2017 7 ‘i 8 MW REQUIREMENT 9 SOLOMON GULCIT 52,606 52,606 52,606 52,606 - 52,606 52,606 52,606 $2,606 $2,606 52,606 52,606 10 EXISTING DIESELS 0 0 0 8 27 47 67 6 106 126 146 11 NEW DIESELS 16,424 17,040 17.663 18,291 18,923 19,563 20,212 20,857 21,506 22,161 22,819 12, ALLISON LAKE 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 26,715 13 LOSSES ceeece OY IB TBD NON SG) SIN) A I) 26) 14 TOTAL REQUIREMENT 95,540 96,172 96811 97,459 98,115 98,780 99,454 100,123 100,797 101,477 102,160 15 16 TOTAL, LESS SOLOMON 42,934 43,566 44,205 44,853 45,509 416,174 AG,RAB 47,517 48,191 48,871 49,554 7 ‘ 18 FUI LLONS 1,060 1,099 1140 1,181 1,223 1,265 1,308 1351 1394 1438 1,482 19 FUE FICIENCY 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 15.5 .20 FUEL PRICE 2.75% 0,831 0.854 0.877 0.901 0,926 0.952 0.978 1,005 1,032 1.061 1,090 21 SOLOMON GULCII RATE 2.75% 0,077 0.078 0.079 0.080 0,081 0.082 0.084 0.085 0.086 0.087 0.089 22 23 24 DSL FUEL COST 880 929 1,000 1,064 1,132 1,204 1,279 1,357 1,439 1,525 1,615 2S LABORAKE ‘ 1s 118 121 123 128 132 135 139 13 147 1st 26 LABOR PRODUCTION 915 940 966 | 993 1,020 1,048 1077 * 1,107 1ta7 1,168 1,201 27 GDP GENERAL 292 300 208 317 326 335 a4 333 363 373 383 28 GDP UNITS 0 0 0 0 Fe 0 0 0 0 0 o 29 VDP GENERAL 292 300 308 316 325 334 343 353 362 372 30 VDP UNITS 0 0 0 0. 0 0 0 0 0 0 31 OTHER 43 44 45 46 48 49 50 $2 53 54 32 DSI. INTEREST 28 W 5 1 0 0 0 0 0 0 33 DSL DEPREC 0 0 0 0 0 0 0 0 0 0 “34 SOLOMON POWER COST 1,042 1,056 1,070. 1,085 1,100 1116 1.132 - 1148 1,165 1,182 35 ALLISON INTE 2,083 2045 2,005 1,963 1,919 1,872 1,824 1,773 1,719 1,663 36 ALLISON DEPRECIATION 922 932 932 932 912 932 932 9322 932 9322 37 ALLISON O & M 2.15% 427 438 450 463 416 489 $02 516 530 S45 38 NEW DIESE scl aut 432 454 477 500 $25 351 578 606 635 39 NEWD scl 35 315 285 253 219 183 146 107 66 34 40 NEW DIES ol | Ee ea re cme, TI dere pee 378 S730 ees re edie! 299. 41 TOTAL COSTS 8,527 8,477 8,547 8,720 8,816 8,914 9,015 9,119 9,088 9,067 42 43 COST PER KWIVSUPP 50,1986 50.1916 $019.33 50.1924 $0.1916 0.1909 $0.1903 $0,1897 $0, 1892 50.1860 $0,180 SAT OF VEO PN Ne TAD . . “vised “8 "*al Str-te SCHEDULE OF INFLATION ALLISON LAKE ALLISON LAKE MARIT 0.0273 SOLOMON GULCH RATE oam DEDT SFRVICE TOTAL SOLOMON RATF. EW DIESEL nats: VAR MARIE NENW DIFSELS 00279 FIX MARTE MAW DIES: 0273 DISTAL KW CUMIN, DISTAL FD KW COST POU KW RATA TOTAL TOR 2130 KY STALL. NIDW DIENT S CUMUL BISTALLED Cost DIPRACUTION PER Un CUMUL DErRECUTION NTEEST TOE 1996 ADUTTION TOTAL INT MEAY DSLS. ew DIESEL DUMLDIO 1999-2008 1004.2017 NEW DLDO COST PER CTA MEW DIFSU. KWH REQUIRE, ALISON LAKE ALION LAKE NEW DITSDS TAXED MAMIRMANCE VARIADLE MAINT TOTAL MEW St. BAIT File Mae DITLALL, 00100 oor 126000 123800 ast 2.474.650 197,000 ansie a9, Jon.o89 B6992 sites 592,806 3O1SS9 2309 oon ooue om Cote 09100 06100 0.0106 von? 00) eons oot oot oon Ooms 197433 14 s0%68 14 outs is008 oun? 130 6130 1,367 299.8 3.383.406 1 1s6taor 11364490 137,088 6 152,099 1370 1 426026 378,223 378, 128,679 103 Trt 197,692 999,089 is 146,955 142908 ast Home aD ft 136,683 Maat 14408 14996 179,808 ans 11,309 36,799 Havas 1260 1336) 13994 ttaat US200 27,988 2nan Hsssar AR 9r massa 130,369 Sait “inagis siren en ' . . Revived Fer Eat Seek AIJISON LAKE MARIT evecue ? 8 SOLAAION CULO RAT yoann 10 DENT stavicr 1t TOTAL SOLOMON RATIE n ry 20NEw DInsn. ates 19) VAR MARIT PAW DITSrhS FOC MARNT NEW DISET S ITAL KW CUM STALLED KW 19 COST IER KW BISTALLE TOTAL FOR 2130 KW ™ 22 BISTALL MEA DIESELS 2) CUMUL INSTALLED CosT u 23 DEFRECUTION FER UNIT 26 CLAM. DEPRECIATION 2 2 RATArsT Tne 1996 ADDITIONS 30 1997 ADDITION: ” a2 3) VOTAL BYE NEW DES ” 3S MEW DIESEL NUN DONG 1 999.2003 37 2008-2007 38 MEW NLDA Cost Fi ” 40 NFAY DIESTL KWTEREQUIRE 4D ALLISON LAKE CTA AVLISOM LAKE MEW DIESELS 48 POD MABTTIANT, VARIANULE MARIE 46 TOTAL MEW DSL AAI Fle Pee DEFT AED, ' F } ; Bo. Bo af ' ie ah 1 oF Foy SCHEDULE OF INFLATION ALLISON LAKE RAIEOr INILA TION. 2008 3007, 7008 2009, 2019 zen ners anno 413,206 426,625 ANA 57 463. eos oor eons oor oon 0.0134 oss Ones irene 739009 vests 19.998 nooo 8400 A600 sano ano oes ta00 106) ore 1996 138 eos 3,070,144 4,003,702 4,143,902 4.291,009 AAAI 4,396,836 Hs6tanh serene 378,223 370,223 378,223 378,225 978223 33078 63,926 500122... 0 M4363 199,277 203,326 25.80) Isse> 293,931 203,929 sana 16424 17,663 ta assy 495038 Stee AAR Gud 392.038 S150 “eons Oto DASOANe 3,096,372 sean A seeaee Sot 4a1ou 378,223 sate m Revised Beef wat Sted en ee ee j 1 4 3 7 z fi { t ‘ te 4 z t ‘ i ‘ i ‘ j : INTERTIE NON-INTEGRATED CAPACITY LEASE OR ECONOMY ENERGY AND INTEGRATED FIRM ENERGY | 1 MEDIUM LOAD-LOW FUEL 1 ANN PAY, . ) 50 YEAR, ZERO INT. LOAN $700,000 4S YEAR,$ 00% LOAN $ TOTAL COST OF LINE 6 7 INFLATION ADJUSTED. 102.75% 8 POWER COST CLANF 19985's (KWH) 30.035 9 POWER COST--FIRMIO98 S's (KWINS® 30.056 10 WHEELING TO MEA PMILLKWH -MEDIUM LOAD.- (NOT INTEGRATED) ST (KWH) $0.0350 40.0360 $0.0370 $0 03R0 50.0190 $0 0.101 soot? 90123 500135 son WAISUPPLEMENTAL KWH REQ INELAT 37,100,000 37,711,000 38,330,000 39,063,000 39,79:1,000 49,414,000 41,067,000 14,688,000 12,309,000 Wg! IS{DEPRECIATION RATE $1,076,510 $1,076,310 $1,076,510 $1,076,510 $1,076,510 $1,076,510 51,076,510 51,076,510 $1,076,510 I6]ANNUAL INTEREST voces SPIO 990 $990,998 IINPAL SRO INN SHOR $RR3,760 | SB7OASH | SRS6 APN $01,026 HISUNTOTAL DENT SERVICE, 42,016,890 $2,107,178 51,996,524 S19K5,001 $1,972,908 $1,960,100 $1,916,998 $1,933,001 SHIT 366 JEDNAT SERVICE COST KWH 0.05 0.0502 005 O0s08 0016 ORS oon 00161 0018) on E OAM EXPENSE ‘ $237,072 $243,531 $250,290 $289,179 $159, 0K6 $271,512 $278,978 $286,680 $294,593 smd, 3 $229,054 $235,353 $211,825 SLARATS $185,108 $262,029 $269,518 $276,956 $2H.1,572 $292, veceee, SULASIT 0, $117,676 $12 $124,23 $127,651 SIMMS ce eee SEM ATB $112,286 $140, NISUNTOTAL LINE OF. COST $2,597,513 52,60 609, 2,614,921 S2718917 $2,625,306 $2,630,291 $2,695,115 $2,639,757 $2,753) 2)/1.1NE OP. COST KWH 0.0700 0.0691 0.0681 00669 0.06R2 0.06.19 0.06.10 00632 00628 on $145,398 $135,187 $124,339 $113,992 $103,177 $91,839 579,871 $67,671 $5.4971 su. . $247.00... _5247,000 $247,000... .., $217,000. $217,000 $217,000 $247,000... 3247,000_ $247,000 , sunt 52,989,011 52,986,285 $2,980,891 $2,975,912 $2,066,004 $2,961,148 957,162 «$2,919,786 $2,9-11,728 $2,81n4 0.0806 00792 00778 00762 00770 0.0739 0.0720 00708 00695 00 wal $1,298,500 $1,356,182 $1,416,350 SNABIIIO SF ESS2AND $1,621,060 S1,691422 $4,764,217 $1,839,736 $1,918 72:10 $4,459,012 SAGIRAI7 5 1,SR5,205, $1,618,581 $1,714,009 SATRIA64 saayis ar oer Od 0.1192 om 01130 $0.0560 $0.0575 50.0591 * $00607 sone 300611 $0. 0659 $0 0677 $0 0696 $2,077,600 $2,169,891 $2,266,160 $2,373,008 SIAR IAMS $2,893,696 32,706,275 $2,919,577 $229,054 $235,383 $241,825 SIAR ATS $258.1T $262,329 $269,511 SIRASTI $114,527 $117,676 $120,913 S248 SiD- 6st S11 165 sist, SUIRATS SHADIRS $145,398 SHISIR7 $124,339 5413,992 SION NTT $91,839 $79,871 $67,671 SS4.971 $217,000 16,029 00R22 0.0837 00758 0.0770 $1,471,862 $1.101,108 $1,259,176 $4,952,129 as | UMILE FOR WHEE ER) 4% **BASED ON INFORMATION PROVIDED DY CHUGACH (DECEMBER 1993) 47 *** SAVINGS COMPARING CASE 1 TO CASE 2 SIT OUTER AVPM Revwved Pet Fusal Study a J 1 MEDIUM LOAD-LOW FUEL 2 3 390 YEAR, ZEROINT LOAN 435 VEAR,S.00%6 LOAN S TOTAL COST OF LINE 6 7 INFLATION ADIUSTED 8 POWER COST CUNF 199K5's (KIT) 9 POWER COST--FIRMI998 S's (KWII)S® 10 WHEELING TO MEA ME VEAR SE 1-- NON-FIRM- POWER COST (KIN AESUPPLEMENTAL KWIL REQ. DEPRECIATION DENT SERVICE COST KWII LINE OAM EXPENSE WISTANDHY LABOR DIESEL, IDIESEL PLANT OAM 22} SUBTOTAL LINE OF. COST 2;LINE OF. COST KWIL MERESIDUAL INTEREST t 25:RES. DEPRECIATION DIE: 16{SUD-TOTAL COST LESS P.C. 27:COST, LESS POWER COST KWIL POWER COST TOTAL COST OF POWER FA. I2/POWER COST KW! OST OF SUPT’. POWER JESTANDDY LANOR DIESEL, JSIDIESEL. PLANT OAM YIRESIDUAL INTEREST DIESEL J7ERES. DEPRECIATION DIE IR TOTAL POWER COST IHIOTAL COST KWH ». 4 n 43 TOTAL, SAVINGS FORSI ANNUAL, SAVING vee 4s FILE NAME PNEINT AI, seam egSOOeDOseDOOREs SOOOLCCAELED DSC EBLLELESEELOEASCEMESDLOULEDSEITENAEBLLSSICBLBEDEEIEBEBESEELOOLOCLELIDAEEBLELEODOICLDSUIDSEBCCCCESOLYOOEALEDORIEOEDICOEOEDCDILEAICOEOTECEIEADICCODOMCDRSTTIUITECEOCOMMDRAEIERURDE NICER: RIOD 6 **BASED ON INFORMATION PROVIDED BY CHUGACH (DECEM 47 *** SAVINGS COMPARING CASE 1 10 CASE 2 z u 4 z ‘ 2 , 6 j 4 : i: ii INTERTIE NON-INTEGRATED CAPACITY LEASE OR ECONOMY ENERGY AND INTEGRATED FIRM ENERGY cost ANH, PAY. $35 MILLION 3! $53.8 KILLION 102 75%% $0035 $0056 I MILLKWH SUE US SAUL UNI A ROLLA RAUL Leedvesoesie,t_, Hever 1) Jum ealasbBA? 1 11s800aR son eI LAUR cnet) Jeemeeneseoant nde benereemveeect~d ketene fenrae ie er ee ee NTEGRATED) 50,0159 $0.0172 $0,085 $00.198 s00s12 59.0526 40.0510 50.0555 300570 snows INTLAT. 13,566,000 41,851,000 48,310,000 46,817,000 47,517,000 48,192,000 AK,871,000 19,998,007 RATE $1,076,510 $1,076,310 $1,076,810 $1,076,510 $1,076,810 $1074 $810,251 $175,456 $672,033 SOMITE 621,00 $1,886,799 517 S1724081 $1,609,000 0013) 0x8) oo av SID ORE SHUG $260,135 Su2eON SIKH se sry SSE $300,439 $104,701 $325,913 SVTIOS $950,517 $169,270 $179,289 SKASE Wo $150,219 __ S154,350 $162,956 i $172,012 SIG ITA SUBTOIS $186,010 S196 $2,669,443 $2,673,989 $2,682,283 $2,895,275 $2,722,021 $2,725,902 $2,729,492 $2,732, 186 $2,790, 0.0613 0.0605 O.05R0 00027 Skt 00574 0.0366 oosse vow 52726 $10,723 Soil s2ut $2,684,112 * $2,895,180 $2,722,021 “$2,715,902 $2,719,002" $2,790.72 0.0607 0.0590 00617 OOS o0s74 00566 o0sso oow Hh $2,085,208 $2,266,411 $2,362,765 $2,193.07) ($2,567,003 ‘82,675,064 $2,901.09 $4,919,307 $8,258,245 SSIRS098 $5,292,904 55, 101,466 S567 UK? $0.0735 00755 $00775 soaxo soos $0,086.41 $0 ORRR yan $3,200,030 $3,336,333 SNATRAN $),7R0,124 $1.9 0917 $1,107,205 $4,280,102 Sha tn,st $300,439 $308, 701 SINR SAILORS $352,517 $363,170 SWwEsy $150,219 $15.1,350 $162,956 $167,138 $176,774 $181,635 527,846 $10,723 $612 $204 i i007 $115,739 $1,282,917 siisou 0981 0.0862 O.0RX} 00901 o077R $833,567 $978,303 199) simon 2 Revised Mer H meal Storts DOERTIE MAINT DYTLATED BECK NUROIERS INTERTIE MAQIT FER CTA File Mane O41 1801. 1993, 207000 282000 221000 346000 240090 269900 1999, 2nesaz 297,923 293,922 365,292 233,982 205.998 SCHEDULE OF INFLATION 224,931 309,918 209.78 INTERTIE 1997, 290,727 SID 246.900 1999, 297.072 322,967 239,103 396,263 274,066 308,079 316,931 466912 237,072 M30 i109 siten me 5 Kevived Pe Twat Siok NTERTTE MAnTT INTLATTD NECK NUMER. eevee eene 10 " an ” 14) DETER TIE MART FER CTA Fite Mame SGI. gE? gbY hy Ry BS eos foo t bo SCHEDULE OF INFLATION INTERTIE 291,933 373.983 40n2ie gnz2nz syaasys aon ane 492008 a. 730 488,999 495,928 331gne 338 site aur Revsved Pee Loa Sth @eaon-cosavermsune SSeanea ss eae eeeceewesesese = =-—~—-——-— SSasGNltSsaveasGns=osavaase s -ooo i t fi f Fk b Fog es oe i ; dod : 4 ’ Note 4050 4080 4070 4on0 4090 14100 tanto 44120 “ yan20 14140 14180 RATE 2% 1% as 2% a% 2% se su se 2% PLANT PORTION OF LOAN 28,000 $04,360 630,180 20,080 503,200 347,000 3,245,040 677,820 421,800 270,730 MATURITY YEAR 1900 2000 2004 2008 2000 2008 2010 2001 2001 2012 OTR PAYMENT PLT PORTION 208 5,29 6, 2,678 $0,047 7,330 10,642 a2 2,058 21-00-99 31-Dee02 314,019 102,250 31-Dee-93 11-084 21-000-03" 31.0093 31-Oee-03 176,480 15,804 224,963 02,039 2,203,584 330,474 TODAYS DATE PUT PORTION BAL 12/91/03 Tora PUNCIPAL PAYMENT 1,120 1,04 1,16 244,740 184 110,120 259,845 45,798 259,063 ' 203,416 427,023 249,006 194,995 239,078 140,179 240,849 2oiter 10,083 272,729 163,074 10,258 267,200 192,222 10,402 274,004 10,673 aer2ee 201,189 190,217 151,008 TOTAL PARICIPAL fintenest payment 192,081 174,248 165,048 188,409 145,308 v9.07 124,339 449, 109,197 ne COPPER ELECTRIC ASSOCIATION COST OF POWER ANALYSIS SCHEDULE OF DEPRECIATION ON EXISTING DIESEL GENERATION FACILITIES 12/31/93 FERC ACC/DEPR BOOK ACCT DESCRIPTION COST TO 12/93 VALUE 341 STRUCTURES / 1,836,736 1,085,827 750,909 342 FUEL HOLDERS & ACCESS 346,233 204,683 141,550 343 PRIME MOVERS 515,868 304,967 210,901 344 GENERATORS 4,502,056 2,661,490 —-1,840,566 345 ACCESSORY EQUIPMENT 714,854 422,602 292,252 346 MISC POWER PLANT EQUIP 234,180 138,441 95,739 8,149,927 4,818,010 3,331,917 REA DEPRECIABLE LIFE . som ANNUAL DEPRECIATION 246,967 YEARS OF DEPRECIATION REMAINING “ . 13.5 1994-2006 13 YEARS 246,967 = 3,21 2007 + +1YEAR 121,340 121,340 TOTAL 3,35 COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE DIESEL EXPANSION CASE YEAR ACQUIRED 1996 PRINCIPAL 2,743,689 INTEREST RATE 5.0% TERM 20 PAYMENT (220,160.70) ANN DEPREC 137,184 COST ESCALATOR 3.5% YEAR PAYMENT INTEREST 1996 220,161 137,184 1997 © 220,161 133,036 1998 220,161 128,679 1999 220,161 124,105 2000 220,161 119,303 2001 220,161 114,260 2002 220,161 108,965 2003 220,161 103,405 2004 220,161 97,567 2005 220,161 91,437 2006 220,161 85,001 2007 220,161 78,243 2008 220,161 71,147 2009 220,161 63,697 2010 220,161 55,873 2011 220,161 47,659 2012 220,161 39,034 2013 220,161 29,978 2014 220,161 20,468 2015 220,161 10,484 PRINCIPAL 82,976 - 87,125 91,481 96,055 100,858 105,901 111,196 116,756 122,594 128,723 135,160 141,918 149,013 156,464 164,287 172,502 181,127 190,183 199,692 209,677 BALANCE 2,743,689 2,660,713 2,573,588 2,482,106 2,386,051 2,285,193 2,179,292 2,068,096 1,951,340 1,828,746 1,700,023 1,564,863 1,422,945 1,273,932 1,117,468 953,181 780,679 599,552 409,369 209,677 (0) —_% COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 DIESEL EXPANSION CASE YEAR ACQUIRED 1997 PRINCIPAL 2,839,738 INTEREST RATE 5.0% TERM 20 PAYMENT (227,866.32) ANN DEPREC 141,986 COST ESCALATOR 3.5% PAYMENT INTEREST 227,866 141,986 227,866 137,692 227,866 133,183 227,866 128,449 227,866 123,478 227,866 118,259 227,866 112,778 227,866 107,024 227,866 100,982 227,866 94,638 227,866 87,976 227,866 80,982 227,866 73,637 227,866 65,926 227,866 57,829 227,866 49,327 227,866 40,400 227,866 31,027 227,866 21,185 227,866 10,851 PRINCIPAL 85,880 " 90,174 94,683 99,417 104,388 109,608 115,088 120,842 126,884 133,229 139,890 146,885 154,229 161,940 170,037 178,539 187,466 196,839 206,681 217,016 BALANCE 2,839,718 2,753,838 2,663,663 2,568,980 2,469,563 2,365,174 2,255,567 2,140,479 2,019,637 1,892,752 1,759,523 1,619,633 1,472,749 1,318,520 1,156,579 986,542 808,003 620,537 423,697 217,016 (0) COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE DIESEL EXPANSION CASE YEAR ACQUIRED PRINCIPAL INTEREST RATE TERM PAYMENT ANN DEPREC COST ESCALATOR YEAR ; PAYMENT 1998 235,842 1999 235,842 2000 235,842 2001 235,842 2002 235,842 2003 235,842 2004 235,842 2005 235,842 2006 235,842 2007 235,842 2008 235,842 2009 235,842 2010 235,842 2011 235,842 2012 235,842 2013 235,842 2014 235,842 2015 235,842 2016 235,842 2017 235,842 Ww a Nn 1998 2,939,108 5.0% 20 _ a Lo Ur as ‘o yu xv INTEREST 146,955 142,511 137,845 132,945 127,800 122,398 116,726 110,770 104,516 97,950 91,055 83,816 76,215 68,233 59,853 51,054 41,814 32,113 21,926 11,231 PRINCIPAL 88,886 222 * 93,331 97,997 102,897 108,042 113,444 119,116 125,072 131,325 137,892 144,786 152,026 159,627 167,608 175,989 184,788 194,027 . 203,729 213,915 224,611 BALANCE 2,939,108 2,850,222 2,756,891 - 2,658,894 2,555,997 2,447,955 2,334,512 2,215,396 2,090,324 1,958,998 1,821,107 1,676,320 1,524,295 1,364,668 1,197,059 1,021,071 836,283 642,255 438,526 224,611 0 COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE DIESEL EXPANSION CASE YEAR ACQUIRED 1999 PRINCIPAL 3,041,977 INTEREST RATE 5.0% TERM 20 PAYMENT (244,096.10) ANN DEPREC 152,099 COST ESCALATOR 3.5% YEAR _ PAYMENT INTEREST 1999 244,096 152,099 2000 244,096 147,499 2001 _ 244,096 142,669 2002 244,096 137,598 2003 244,096 132,273 2004 244,096 126,682 2005 244,096 120,811 2006 244,096 114,647 2007 244,096 108,174 2008 244,096 101,378 2009 244,096 94,242 2010 244,096 86,750 2011 244,096 78,882 2012 244,096 70,622 2013 244,096 61,948 2014 244,096 52,840 2015 244,096 43,278 2016 244,096 33,237 2017 244,096 22,694 2018 244,096 11,624 PRINCIPAL 91,997 " 96,597 101,427 106,498 111,823 117,414 123,285 129,449 135,922 142,718 149,854 157,347 165,214 173,475 182,148 191,256 200,818 210,859 221,402 232,472 BALANCE 3,041,977 2,949,980 2,853,383 2,751,956 2,645,457 2,533,634 2,416,220 2,292,935 2,163,485 2,027,563 1,884,845 1,734,992 1,577,645 1,412,431 1,238,957 1,056,808 865,553 664,734 453,875 232,472 0 COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE DIESEL EXPANSION CASE YEAR ACQUIRED 2000 - PRINCIPAL 3,148,446 INTEREST RATE 5.0% TERM 20 PAYMENT (252,639.45) ANN DEPREC 157,422 COST ESCALATOR 3.5% YEAR "PAYMENT INTEREST PRINCIPAL BALANCE = 3,148,446 2000 252,639 157,422 . 95,217 3,053,229 2001 252,639 152,661 99,978 2,953,251 eh 2002 252,639 147,663 104,977 ° 2,848,274 : 2003 252,639 142,414 110,226 2,738,048 # 2004 252,639 136,902 115,737 2,622,311 2005 252,639 131,116 121,524 2,500,787 2006 252,639 125,039 127,600 2,373,187 = 2007 252,639 118,659 133,980 2,239,207 : 2008 252,639 111,960 140,679 2,098,528 = 2009 252,639 104,926 147,713 1,950,815 2010 252,639 97,541 155,099 1,795,716 2011 252,639 89,786 162,854 1,632,863 2012 252,639 81,643 170,996 1,461,866 2013 252,63 73,093 179,546 ‘1,282,320 2014 252,639 64,116 188,523 1,093,797 2015 252,639 54,690 197,950 895,847 2016 252,639 44,792 207,847 688,000 2017 252,639 34,400 218,239 469,760 ; 2018 252,639 23,488 229,151 240,609 2019 252,639 12,030 240,609 (0) Ife “44 e & COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE vw yv vy iy =) Ss n ALLISON LAKE PRINCIPAL INTEREST RATE TERM PAYMENT DEPRECIATION PAYMENT 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 2,845,636 46,595,000 5.0% 35 (2,845,636.20) 931,900 50 YEARS INTEREST ty w So ° Xo Ns Us an VNpy Ww WwW w& vw wy oo 09 DL) 0 OD ~ uw uw 29 UW x 2,187,220 2,154,299 2,119,733 2,083,437 2,045,327 2,005,312 1,963,296 1,919,179 1,872,856 - 1,824,217 1,773,146 1,719,521 1,663,216 1,604,095 1,542,017 1,476,837 1,408,397 1,336,535 1,261,079 1,181,852 1,098,662 1,011,314 919,598 823,296 722,179 616,006 ~ $04,524" 387,469 264,560 135,506 PRINCIPAL 515,886 541,681 568,765 597,203 627,063 658,416 691,337 725,904 762,199 800,309 840,324 882,340 926,457 972,780 1,021,419 1,072,490 1,126,115 1,182,421 1,241,542 1,303,619 1,368,800 1,437,240 1,509,102 1,584,557 1,663,785 1,746,974 1,834,322 1,926,039 2,022,341 2,123,458 2,229,630 2,341,112 2,458,168 2,581,076 2,710,130 BALANCE 46,595,000 46,079,114 45,537,433 44,968,669 44,371,466 43,744,403 43,085,987 42,394,650 41,668,747 40,906,548 40,106,239 39,265,915 38,383,574 37,457,117 36,484,336 35,462,917 34,390,427 33,264,312 32,081,891 30,840,349 29,536,731 28,167,931 26,730,691 25,221,590 23,637,033 21,973,248 20,226,275 18,391,952 16,465,914 14,443,573 12,320,116 10,090,485 7,749,373 §,291,206 2,710,130 0 COPPER VALLEY ELECTRIC AMORTIZATION SCHEDULE INTERTIE DEBT SERVICE COST PER BECK STUDY STATE LOAN iJ AMOUNT TO FINANCE REA INTEREST RATE TERM ANNUAL PAYMENT ; YEAR * PAYMENT 7 1998 1,149,797 1999 1,149,797 i 2000 ; 1,149,797 =" 2001 1,149,797 2002 1,149,797 ’ 2003 1,149,797 a 2004 1,149,797 2005 1,149,797 2006 1,149,797 2007 1,149,797 2008 1,149,797 2009 1,149,797 2010 1,149,797 a 2011 1,149,797 2012 1,149,797 2013 1,149,797 eo 2014 1,149,797 2015 1,149,797 2016 1,149,797 2017 1,149,797 a 2018 1,149,797 2019 1,149,797 2020 1,149,797 ae 2021 1,149,797 2022 1,149,797 2023 1,149,797 ni 2024 1,149,797 2025 1,149,797 2026 1,149,797 2027 1,149,797 oe 2028 1,149,797 2029 1,149,797 7 2030 1,149,797 ye 2031 1,149,797 2032 1,149,797 33,827,000 35,000,000 18,827,000 3.0% 35 (1,149,797.03) INTEREST 941,350 930,928 919,984 908,494 896,428 883,760 870,458 856,491 841,826 826,427 810,259 793,282 775,456 756,739 737,086 716,451 694,783 672,033 648,144 623,062 596,725 569,071 540,035 509,547 477,535 443,921 408,628 371,569 332,658 291,801 248,901 203,856 156,559 106,897 54,752 PRINCIPAL 208,447 218,869 229,813 241,303 253,369 266,037 279,339 293,306 307,971 323,370 339,538 356,515 374,341 393,058 412,711 433,346 435,014 477,764 501,653 526,735 553,072 580,726 609,762 640,250 672,263 705,876 741,169 778,228 817,139 857,996 900,896 945,941 993,238 1,042,900 1,095,045 DEPRECIATION 53,827,000 50 1,076,540 BALANCE 18,827,000 18,618,553 18,399,684 18,169,871 17,928,567 .. 17,675,199 17,409,161 17,129,823 16,836,517 16,528,545 16,205,176 15,865,637 15,509,122 15,134,781 14,741,723 14,329,012 13,895,666 13,440,652 12,962,888 12,461,235 11,934,500 11,381,428 10,800,702 10,190,940. 9,550,690 8,878,428 8,172,552 7,431,383 6,653,155 5,836,016 4,978,019 4,077,123 3,131,183 _ 2,137,945 1,095,045 0 CHUGACH ELECIIXIC ASSOCIATION, INC. jeals | PASTOR WY BR Ul L- ‘ DAVID L. RIGHERS MEH 17 1994 Original Fie +... Strerel Monecer - : Working Copy lo. . LurcER VALLEY seme eens ch 14, 1994 oes a le . ELECTRIC ASSOC. Mr. Clayton Hurless General Manager Copper Valley Electric Association, Inc. P.O. Box 45 Giennallen, AK 99588-0045 Subject: Wholesale Power Provision/CVEA Intertie Dear Cleyton: Chugach hes previously provided the conceprual fremework for provision of wholesale power to Copper Valley Electric Association. Tom Loves, Chugach's Manager of Planning and Rates made - an oral presentation of the concepts to the CVEA Board at the December 3, 1993 special board aad meeting in Valdez. The purpose of this letter is two-fold: 1) to indicate our continuing interest in working with CVEA to develop a mutually beneficial power supply arrangement; and, 2) to afirm the cost estimates associated with the concepts discussed at that meeting. Chugech is committed to providing cost-effective wholesale and retail energy today and into the = future. We wish to be considered a resource to CVEA, and are prepared to assist CVEA in securing long-term power supplies. In that vein, we have submitted formal comments on the drafi CVEA Intertie Feasibility Study that support the development of the transmission line accessing Railbelt power supplies and we stand ready to provide additional assistance &t your request. The memorandum of understanding we previously provided to you will support the dedication of ie Chugach's resources toward the development of an appropriate arrangement. As we indicated in December, our preference is for 2 firm power sale. A firm power arrangement ~ provides the essurance an adequate and continuous supply for CVEA members. Further, it would provide # basis for development of future loads, such 2s expansion to serve the Alyeska terminal. Finally, it would provide security for Chugach investment in the generation and transmission a facilities necessary to serve CVEA. Preliminsry analysis completed by Chugach staff indicates that CVEA's overall cost of power could potentially be reduced significantly by entering into 2 net requirements power supply arrangement with Chugach. Net requirements means provision of all power required in excess of that produced by Solomon Gulch which is currently purchased directly by CVEA. Under 2 net requirements arrangement, Chugach could participate in the construction of the CVEA intertie in such 2 way that the costs of the intertie would be included in the generation end transmission cost pool of Chugach. “ . _— - 5504 Minnesoia Drive » P.O. Box 494300 « Anchorage. Alaska 99549-6300 Phone 907-543-7494 « FAX 907-542-0027 , f Mr, Clayton Hurless » March 14, 1994 Wholesale Power Provision/CVEA Intertie Peec2 The initial cost of such net requirements power delivered to the Pump Station 1] substation, with an intertic construction cost of $40 million, was estimated at epproximately 5.4 ¢/kWh beginning in 1996, This assumes that the total cost of the CVEA intertie (1.c., state Joan, any additional financing and operation and maintenance expenses) would be included in Chugach's generation and transmission costs end allocated among ell Chugach firm power customers. If the construction cost is increased to the RW. Beck estimate of $52 million, the cost of power under that type of grrangement would increase to around 5.5 ¢/kWh in 1996. With firm, net requirements service, CVEA will, of course, be eligible for capital credits in the same fashion as other wholesale customers. Under the net requirements errangement with Chugech participating in the interties in that fashion, we estimate that the break-even point for existing Chugach customers would be between 4 and 6 years following the completion of the line. We do not consider that period to be unreasonable for 2 power supply: arrangement that could extend, theoretically, for the economic life of the transmissionline. | — . Chugach could, alternatively, provide net requirements for CVEA without pooling the cost of the line, delivered to O'Neili, at 2 rate on the order of 5.1 ¢/cWh in 1996. In this alternative, CVEA would shoulder the entire burden of the intertie costs. . . However, if CVEA were to shoulder the entire burden of the intertie costs, CVEA would presumably look to non-assured, interruptible power delivered to O'Neill substation at 2 lower cost of around 3.5 /KWh (in 1996). We are not particularly interested in providing non-firm service. Furthermore, our estimates indicated thet CVEA would see much greater potential interconnection benefits from net requirements and pooled transmission costs than from non-frm service. In the event of intecruptible power provision, we would be unable to obligate our system to CVEA, and there would be no gusrantee of power deliveries. Non-assured supplies or limited service obligations on the part of Chugach (or any other railbelt utility) would likely constrain CVEA's ability to negotiate for the Alyeska terminal Joad or, perhaps, other potential and significant sales opportunities. The estimates in this letter are projected rates under alternative concepts for supplying power to CVEA. Before we formally offer to contract we would like to discuss these and any other concepts end methodologies in detail. Of course, approval of the Chugach board and the APUC will be required, I trust this information is helpful to your consideration of 2 power supply arrangement. Please let. me know if any other information would assist you in considering our proposed memorandum of undecstanding. We seek to be CVEA's supplier of choice, and support your eZorts to secure low-cost power for your members. Sincerely, CSUGACH ELECTRIC ASSOCIATION, INC, pee General Manager uy a Q Attachment 6 aes 7. COPPER VALLEY ELECTRIC WEIGHTED AVERAGE COSTS INTEGRATED CASE BASE CASE BECK STUDY SOLOMON GULCH SUPPLEMENTAL REQUIREMENT RESIDUAL TOTAL BASE CASE BASE CASE PLUS ALYESKA SOLOMON GULCH SUPPLEMENTAL REQUIREMENT ADD ALYESKA RESIDUAL TOTAL WITH ALYESKA BASE CASE, ALYESKA PLUS VAPOR RECOVERY SOLOMON GULCH SUPPLEMENTAL REQUIREMENT ADD ALYESKA ADD VAPOR RECOVERY RESIDUAL TOTAL W/ ALY & VAPOR RECOVERY NON INTEGRATED CASE BASE CASE BECK STUDY SOLOMON GULCH SUPPLEMENTAL REQUIREMENT DEPRECIATION INTEREST * T-LINE O & M RESIDUAL TOTAL BASE CASE BASE CASE PLUS ALYESKA SOLOMON GULCH SUPPLEMENTAL REQUIREMENT ADD ALYESKA DEPRECIATION INTEREST T-LINE O&M RESIDUAL TOTAL WITH ALYESKA BASE CASE, ALYESKA PLUS VAPOR RECOVERY SOLOMON GULCH SUPPLEMENTAL REQUIREMENT ADD ALYESKA ADD VAPOR RECOVERY ECIATION T-LINE O&M RESIDUAL TOTAL W/ ALY & VAPOR RECOVERY 2001 MWH COST/KWH 52,000 39,000 91,000 52,000 39,000 50,000 141,000 52,000 39,000 50,000 26,000 167,000 52,000 39,000 91,000 52,000 39,000 50,000 141,000 52,000 39,000 50,000 26,000 167,000 0.0710 0.0610 0.0710 0.0610 0.0610 0.0710 0.0610 0.0610 0.0610 COST/KWH 0.0710 0.0380 0.0710 0.0380 0.0380 0.0710 0.0380 0.0380 0.0380 ATTACHMENT 6 WEIGHTED DOLLARS COST/KWH 3,692,000 2,379,000 733,000 6,804,000 3,692,000 2,379,000 3,050,000 733,000 9,854,000 3,692,000 2,379,000 3,050,000 1,586,000 733,000 11,440,000 DOLLARS 3,692,000 1,482,000 1,076,540 908,494 257,173 733,000 8,149,207 3,692,000 1,482,000 1,900,000 1,076,540 908,494 257,173 733,000 10,049,207 3,692,000 1,482,000 1,900,000 988,000 1,076,540 908,494 257,173 733,000 11,037,207 0.0748 0.0699 0.0685 WEIGHTED COST/KWH 0.0896 0.0713 0.0661