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HomeMy WebLinkAboutTranscript Alaska Energy Authority Public Hearing December 6, 199110 pi 12 13 14 15 16 17 18 19 8 &S 8 B Zee — (gee “bnrest ie TRANSCRIPT Alaska Energy Authority Public Hearing Held in Petersburg City Council Chambers 7:00 P.M. - December 6, 1991 My name is Dick Emerman from the Alaska Energy Authority, this is Ed Johnson from Dames and Moore, he is going to be working with us subject of this Public Meeting is the proposed Tyee-Swan Intertie and the reason we called the meeting was to let you know that we now have authorization, as of about a month ago, and are just now beginning a formal feasibility study of the proposal. And in line with that we want to let you know and to first of all come around and give a little background on the process that we are going through and were we stand on that process and also to solicit whatever comments and questions people have at this phase thing that maybe we should be looking at more carefully as we get int the feasibility study things that we should be aware of - so that' the purpose of it. My job at the Authority is an economist my rol in this is the project manager of the feasibility study. And w have awarded the contract for the study to the:-RW Beck an Associates, backed by -- sub-contracted by Dames and Moore fo the environmental analysis portion of the study. And Ed Johnso will be the lead in doing that environmental analysis portion. 10 11 12 13 14 15 16 17 18 19 g & 8 B guess with that - I guess the way I thought we'd do it is I'll give you a little basic description of the intertie proposal. Many of you were in Wrangell last spring and we went through it in some detail, I won't go into that detail now unless you want me to with guestions and so on, and I'll then tell you a little about the process we are required to go through in order to build the project like this and then that will lead into Ed who will have some comments to make about the environmental issues that appear to be most significant at this time and then that will lead into I suppose general questions and comments that anybody might have. So with that let me just say that the thumbnail sketch of the intertie proposal hasn't changed from what we described last spring, we're proposing and looking at a 138 KV line that would start at Swan Lake and presumably end at the mouth of Eagle River where we would expect to connect it with the existing Tyee line, four or five miles West of the project. The most recent cost update that we had on it was last spring, again, and that was on the order of 40 million dollars, roughly a third of which was clearing costs. You are all familiar with the basic rationale of the project the 13@ million or so kilowatt hour annual protectual energy from TYEE and the existence of about 90 million kilowatt hours annual surplus from that is combined annual demand of Wrangell and Petersburg is on the order of 40 million. So we have that surplus energy resource sitting there and are expecting it to be there for quite some time. Ketchikan on the other hand has been 10 i 12 13 14 15 16 17 18 19 ® F 8 B growing and they are expected soon to be maxing out their local hydro resources including Swan Lake and assuming that expectation is borne out in the future then they will be in the position to probably be buying diesel generators to meet their loads. So the concept is simply a matter of tying them together and using this surplus from TYEE to serve that portion of the Ketchikan load that will otherwise be served by diesel. The overall concept again that we looked at talked about in Wrangell eight months ago if your familiar with, the concept has been around a long time, is to build a complete Southeast intertie grid that would connect all the major load centers in supply resources and ultimately hook into the Canadian system. Much of that may be beyond our planning horizons what we want to do is address those pieces of that ultimate grid system that seems to be achievable in near terms. The most recent study that looked at that entire grid concept was done for us in 1987 by Harsan Engineering and they identified two segments of that grid that appeared to be most promising had the best economics supporting it. One is the Tyee/Swan connection and the other is a project that we are also currently looking at, pursuing, is a connection between Juneau and the Greens Creek Mine. In both cases we are talking about the existence of a substantial hydro surplus and a nearby relatively nearby load that would otherwise be served by diesel power. The process that we have to go through according to our statutes, to actually construct one of these things -- is number one we have what we call a reconnaissance study which is a general overview of regional alternatives that 10 ll 12 13 14 15 16 17 18 19 Rg S 8 B seeks to identify what the most promising options are, and we have also -- that 87 study that I just described is what served as the reconnaissance study for this project. Second we have to do, after that is done, according to our statutes is a feasibility study that focuses on the engineering, economic and environmental aspects of the project and makes a determination of feasibility. And also we have to do a plan of finance which looks at all the financing alternatives and makes recommendations what the best approach would be. Following all that - you take all that to legislature, once the legislature has that the system envisions that given favorable or acceptable outcomes on these studies the legislature can authorize a project and provide any necessary funding and once they authorize to provide funding then we can go forward. In this case the first step in going forward would be, as far as we can tell proceeding would be application to the Forest Service for a special use permit for the right-of-way which then kicks in the, what we assume will be an EIS process. We go through the EIS, assume we get the special use permit, so on and so forth then we are ina position to proceed to designing and construction. I omitted we also to the extent that there is financing involved in terms of plans to issue bonds, we have to also, before we can go forward to actual design and construction negotiate contracts that are going to enable us to provide for a repayment string for the debt service. So where we are at right now is we sought -- let me just go back a little bit again, we had the 87 reconnaissance study, we 10 11 12 13 14 15 16 17 18 19 g & 8S B had a load forecast update in 1999 that seemed to validate or at least to date the load growth expectations we did a preliminary financing study issued in March of 91 March of this year that overall in general suggested that probably in terms of overall magnitude out of the 46 million dollars for the project perhaps 26 million dollars could be financed with revenue bonds which would be repaid by the City of Ketchikan through power sales over the line. The other 20 million dollars probably have to come from somewhere else. Somewhere else is generally considered to be, or assumed to be the State. There are other funding mechanisms I don't know what they are but nobody is closing out other alternatives. At this point that is the way it appears and the reason that the line appears to be or the forecast is, that at this is point the line is economical in the long term, based on a forecast that power sales will continue to grow in Ketchikan. At the present time however the Ketchikan local hydro resource covers all their load. So if the line were built in the near term the transfers over that line in the early years would be relatively low. The forecasts is that as they continue to grow the line would ultimately repay itself but because of the relatively low transfers in the early years that limits the amount that you would reasonably expect Ketchikan to be willing to pay in debt service and that in turn limits the amount of debt it appears that we could issue to finance the project. So we looked at that in early '91 so that we would go into it with our eyes open about what the financial 10 11 12 13 14 15 16 17 18 19 21 23 requirements of the thing might be. Since that time we have sought and have now recently received a funding to go ahead with the feasibility study phase of it and our schedule is to complete the draft of the feasibility study by the end of February. A nice tight time frame, the reason for that is we didn't have a 30 day comment period that would enable us if things go well and according to plan to issue a final feasibility study in April, perhaps a month before the end of the legislative session. And of course the reason for that schedule is we want to be able to bring together for the legislature in advance of their adjournment the materials they would need to authorize to the fund the project should they decide to do so. So we want to be in a position to request authorization in funding during this session. So, as I say, if the legislature does that then it is our intention would be to go forward with the environmental permitting studies that would then validate the next phase and that kind of leads into what Ed had to say about the environmental issues that currently appear to be paramount. Now I'll let Ed continue talking. ED JOHNSON: Thanks Dick, given that kind of time frame the environmental feasibility study is not a detailed environmental analysis sort of impact statement. What it will be is a review of the existing literature data, stuff that the agencies have on hand that we can access readily. And local knowledge that we can find by talking to people and this is one of the main reasons we are here tonight. The sources of data are usually in places like 10 11 12 13 14 15 16 17 18 19 g & 8 B Forest Service files, or Fish and Game files or other agencies. Therefore we've been meeting with the Forest Service and we're planning to contact other State agencies to help us in this. The result we expect would be a description of the kind of environmental effects that you can anticipate from constructing an intertie. And those effects are fairly limited, you're all familiarized I would imagine with the Tyee line and you know what that looks like and how it was built. This is proposed to be built with helicopter construction. Probably very similar to what you saw with Tyee (indiscernible - cough) the route that follows lower elevations, the valley that passes through here crosses Lynn Canal, Bell Island, and this saltwater channel, up to Eagle Lake and down Eagle Creek Valley to where it would tie in with a switching station of some type. Either at one side or the other at the mouth of Eagle River. I am told that there are about four areas that are particularly sensitive environmentally to all of this. So whether there would be an adverse effect is yet to be determined by me. But the head waters of Carroll Inlet down here is a waterfowl area, salmon stream and wildlife, and fairly diverse wildlife habitat in that area. The area around Orchard Lake and the stream that runs into Orchard Lake, Orchard Creek, is a waterfowl area and is also a sport fishing spot, scenic. This area next to Bell Island has several resorts and good saltwater King Salmon fishing and so I suppose the visual affects of crossing here might be important to some interests. There is a question to be answered yet whether 10 11 12 13 14 15 16 17 18 19 ® & 8 B this should be a submarine cable here, and here (indicating on map) or whether it should be an over water cable. They would have different effects. Eagle Lake, I understand, is a good sport fishing area and the Forest Services has cabins there and so in view of this power line from the lake and from the cabins could be very important. And then I understand this is a salmon or a steelhead stream or a portion of it is a steelhead area, and popular fishing area. As proposed now, I believe this crosses the creek one or two times and that may cause some concern from aircraft they obviously don't like cables hanging from the sky or anywhere around so we need to look at that issue. The main environmental effects of this are the clearing of the right-of-way, or whatever effects that has on wildlife habitats, when you go through heavily forested areas clearing out 160 - 2@@ and some feet, more depending on the shape of the ground. The placement of the towers, each one occupies a relatively small area, they should have limited environmental effects. The spans are expected to be an average of 300 feet though they can be considerably longer. Engineers, I think, prefer to have them closer together if they have their choice. They need to avoid landslides, avalanche areas, and for the most part this route does that with one or two exceptions. And those exceptions I think stand (indiscernible - fades out) so far . So that's kind of thumbnail sketch of what - - well, one other point that I recently come into and want to talk about is the Forest Service in its planning has designated this 10 ll 12 13 14 15 16 i7 18 19 ® & 8 RB route as a transportation corridor and a transmission line intertie corridor in their land management plans, in the draft plans of the Tongass National Forest as of now. Which would be compatible land use zone. However Eagle Creek is evidently eligible for wild and scenic river status. I'm not sure but I suspect Carroll River is also eligible for wild and scenic river status. To the best of my knowledge no decision has been made by the Forest Service as to what status they expect to give that in their plan. But that would have -- could have an effect on the feasibility. Wild and scenic river corridors are a quarter of a mile on either side of the stream and I think wild status is very restrictive as to what you can do, scenic is much less so, and I think there is another recreation river which is more available for this kind of development. So that is -- It would be possible even with one of those categories listed to still build this intertie but the position of the intertie in relations to river would have to be adjusted considerably and may have significant impact on costs and economic and engineering feasibility. That is a whole lot of talking about something I know very little so I'd like to open this up to discussion, comments and questions that you might have particularly relevant to the environmental concerns that I have just mentioned but I think Dick probably would entertain questions on other aspects of this if you have some. Sammy is making a record for us, keeping notes there and we would appreciate it if you would speak up so she gets a good clear record and won't have 10 lu 12 13 14 15 16 17 18 19 Rg & 8 B to try scratch all my notes down. If you'd introduce yourself as you speak that would help too. So with that if you have questions or comments floor is open. Sir? DENNIS: EDWARD: DENNIS: EDWARD: DENNIS: Dennis Lewis, with Power and Lights Superintendent here in Petersburg. One thing you mentioned was on Span lengths. You are talking about 300 foot span lengths. Have you seen a design from the engineer firm that is what they are sort of proposing? No I haven't. No I have not seen a design. The reason why I have a conceptual thing only. And the reason why I have asked the question is that between Tyee and Petersburg there are span lengths in excess of ten thousand feet. I understand. There are also some I don't think there is span length less than three hundred feet with in the whole transmission system. It is a concern that there are certain towers in certain areas because of environmental issues. You can extend those span lengths to goa little bit further. My other concern is right there at the mouth of Eagle River. Eagle River crossing goes from point to point - from peak to peak - and looking at a switch yard at that location, I'm talking about the design of the project do you feel like they will be going back up to another area or valley, I know that it's not 10 10 11 12 13 14 15 16 17 18 19 ® SF 8 B ED: DENNIS: DICK: DENNIS: DICK: feasible. I was told they will need a switching installation near where ever this connection is made - other than leaving that wide open so it may make a difference if we are required to stay on one side of the stream all the way or the other then this might become limiting if there is only a place on one side or the other, we've got to be on the right side of the stream when we get there. .... approximately from the floor to the transmission line is 3000 feet. Your going peak to peak. The other question I have concerning debt. I might address this to you (Dick) it is my understanding that you are planning for Ketchikan to pay half of the debt and the State to absorb the other half with no debt being required from Petersburg and Wrangell? There is no plan’ or scenario that I am aware of that would involve any payment coming from Petersburg or Wrangell. The idea would be that a wheeling charge would be assessed on power sales and Ketchikan would pay that wheeling charge. Do you feel that Petersburg and Wrangell because of the way the long term power sales agreement is written will have an opportunity to express their feelings during the Neyotlation between the State and Ketchikan? I don't know much about the power sales agreement or 11 10 11 12 13 14 15 16 17 18 19 R F§ 8 RB initial agreement- I haven't been involved with it much so I don't know what the language in that agreement would imply. But I would think that Wrangell and Petersburg would have interests in this whole thing that would be relevant and would lead to your input one way or another. For example one of the questions that will be important I think is the issue of, as you know Wrangell and Petersburg have priority right to all of your firm power requirements. The question the power that will be sold to Ketchikan will be surplus and interruptable at least to the extent that your firm power requirements will come first. One of the questions that will - it seems to me arise - and that will require involvement of Wrangell and Petersburg will be, what if you want, after the construction of this intertie to enter into a interruptable power sale, for some amount of surplus| power with an existing or future industrial concern i Wrangell or Petersburg.How will that sale or propose sale stand in the priority order compared with Ketchikan? Will it be on equal footing or will Ketchikan' interruptable sale follow in the line of priority an then in other words precede in the order of priority som future interruptable sale you might want to make. Ho would that work out? That was an issue that came up i our public meeting in Wrangell the other day, two day ne 10 11 12 13 14 15 16 17 18 19 g & 8 B DENNIS: ago, and I don't have and answer to that. It seems that is something that will need to be negotiated. On the one hand, I think that this is an issue that was raised the letter the City of Wrangell had prepared by their lawyer Eric Redman last spring at the time we met last - in order for Ketchikan to agree to pay a certain amount of debt service on this line I would - you would expect they would want some sort - I don't know how to say it, some sort of not guarantee but assurance that they will have some reasonable level of access to the power, they understand that they are going to stand behind the firm power requirements of Wrangell and Petersburg. On the other hand if their interruptable sales are to be placed on an equal footing with any other interruptable sales that might come up, they might not find that acceptable we don't know, we have to discuss it with them, if you don't the deal might be off. If Wrangell and Petersburg want the line to be built then you might have an interest in allowing Ketchikan's sales to come second after your firm requirements and any other interruptable sales to come third. It is a complex issue and I haven't thought it through, but I can see how the issue like that would involve Wrangell and Petersburg in the negotiations. I guess my third question when we are talking about this situation is if the intertie goes into the service aS 10 11 12 13 14 15 16 17 18 19 Rg SF 8 B DICK: Ketchikan because Swan Lake is tapped out, and all the capacity is used, if that is tapped out and if we are looking at interruptable sales to our own consumers in Petersburg and Wrangell which we have preference rights to all the power on that project first the third turbine that there is room to put in at the Tyee project for spinning reserve or whatever it may be - what is your feelings on who is going to absorb that debt for the third turbine? As who is going to absorb the debt I don't have any feelings or thoughts, I can tell you that in our feasibility study contracts we have told Beck included in the scope, I have direction for them to look at the cost and economics and justification for a third turbine and the impact of the intertie on the justification for a third turbine. I don't know in what depth we will get an answer from them but they are being directed to explore that question. It is also an issue came up at Wrangell so one of the things they are going to be doing is telling Beck of our concerns about the issue perhaps stronger that might appear in the scope of work. What we heard from Beck in a quick and dirty way back in March when they did their financial study was that overall they have estimate of about five and a half million dollars in '91 dollars to install a third turbine. It is my 14 10 11 12 13 14 15 16 17 18 19 Rg & 8 B DAVE: understanding or it has been anyway - you put in a third turbine, it doesn't increase the annual energy it has other effects - reliability, spinning reserve, the ability to meet peaks. Putting a figure on the value of that is going to be important in the extent that we seek any legislative funding for that third turbine in conjunction with the intertie. So the only decision that has been made by the Authority is to look at it in conjunction with the feasibility study. Where that we were of course aware of the resolutions from Wrangell and Petersburg that supported it and I believe tie the supports for the intertie to the third turbine. Beyond that there hasn't been any thinking or even discussion that I am aware of as to how it would be paid or who would pay it. (City Council Member and also Thomas’ Bay Power commissioner) Dick you mentioned that in view of the factors and why you might want to consider a third turbine and I just thought I would express to you my feelings and my main concern about needing the third turbine is the peaking, not only the reliability but the peaking. I think Wrangell, Ketchikan and Petersburg probably peak about the same time. Same time of year, we're fishing communities and probably the same time today. And it would be nice if you could run Tyee at 15 10 11 12 13 14 15 16 17 18 19 21 23 DICK: DAVE: DICK: a 130 million kilowatt hours. We only need 15 megawatts| is all you need to do that. If you run twenty four hours a day, that isn't the case. You know, we're going tq be like this (demonstrated) up and down and up and dow and somebody I also suspect that when Ketchikan's al to need the most power will probably going to be a tim in the middle of summer when it hasn't rained for d days. Swan (Lake)losses water in a hurry, then they ar going to want to come on Tyee.which is going to tap # more ‘course it's not going to rain in Tyee either, sq Tyee does have a..... I don't know I think the authority is going to do som stream gauging or perhaps try to figure out what wate is being spilled (indiscernible) I think it is important to know just how that power i going to be usea because it will be a peaking facility I don't know how you are going to get around it if - i you have other ideas how we are going to peak please le us know we certainly don't want to be in a position her where we have to start cranking on our diesels. Well I guess one thing that I would say I agree, as mentioned before, that certainly you add the thir turbine you have increased capability to meet a peak loa clearly there is a value attached to that. The onl other thing that I would mention is the priority of 16 10 1 12 13 14 15 16 17 18 19 g & 8 B DENNIS: DICK: Wrangell and Petersburg for the offer of the project also means that you have priority at any time. So if you need to take twenty for your firm requirements - you get twenty at that time, (indiscernible) Ketchikan will not be able to cut into your ability to get the full 206 megawatts for Wrangell and Petersburg's firm requirements. I understand what you are saying we will be looking at that. What impact the third turbine would have and what value it would have in increased capability to the combined Ketchikan, Wrangell, Petersburg peaks. Dick I had one other question. When we are talking about firm commitments of Wrangell and Petersburg and whatever the power that is sold to Ketchikan be it interruptable or firm or whatever the negotiations ends up with. Looking at the overall picture, especially between the Swan Lake and Tyee project can RW Beck study -- are they including a situation where dispatching of all that power will be from one location so that everybody knows where the power is at and where its coming from. Right now there are two separate locations on dispatching. Woul dispatching become a portion of that study -_ to look at who's getting what and where its coming from etcetera? I don't believe there is anything in our scope at 4 present time that talks about dispatching. The issue of combined dispatch came out a couple nights ago in 17 10 11 12 13 14 15 16 17 18 19 R & 8 B DENNIS: DICK: Wrangell. And in the form of concern expressed that Ketchikan was going to take over dispatching Tyee and they -- there would be a loss of control. And in response to that 1 told them that we would have, tell me if I'm wrong, seems to me we must have it in the notes but it seems to me I told them that we would have Beck look at, gee I wish I could remember, what did I tell them, seems to me I said we would look at what the possible impact in terms of the possible savings might be operational savings in terms of combined dispatch so that we had some basic information to go on as to what it might look like. That's the extent that we said anything on the subject. From my perspective as the Power Superintendent of Petersburg, I personally feel, that it is more economically feasible to dispatch all the generation from one location. I want to make that a public statement as far as I'm concerned. What other concerns are there it's irrelevant as far as I'm concerned, but I feel it is more economically feasible to dispatch both generation sites from one location. If my recollection is correct, then one of things even if I didn't say it before, I'll say it now, that if we construct that and we should because the subject keeps coming up to at least make an effort to define what the 18 10 11 12 13 14 15 16 17 18 19 ® & 8 B DENNIS: DICK: DENNIS: DICK: DENNIS: DICK: savings would likely be from combined dispatch. And we'll do that. There is one other thing when we are talking about dispatch and it goes a little bit further than just the Tyee and Swan project, but in order to pay for a portion of a salary to dispatch Thayer, Gravity, Solomon Gulch, Tyee, Swan, all from one central location would be more expensive for a (indiscernible) but at the same time you could dispatch all five of your hydro projects from one location also. Doesn't matter where you're at -- you might want to take a look at that in your study. That sounds like something that is going to be outside the scope of a 9@ day study. I understand that. But that's something down the pike that AEA might want to look at. I'll ask about that when I get back to the office Thank you, I guess my main concern is my rate payers and I'm looking at what is most economically beneficial to all the rate payers and if somebody gets the axe ..... that's life. Yeah, we had this discussion in Wrangell about the on one hand it's a savings -- the complaint was loss of a job or two and loss of control on the other hand presumably if it were to happen -- if we -- it would also mean lower costs, lower rates.. 9 10 ll 12 13 14 15 16 17 18 19 ® F 8 B DENNIS: ED: DAVE: ED: DICK: DICK: DAVE: I'm looking mainly at what my rate payers are paying. And if my wholesale rate goes above 6.4 cents which it is right now, they'll be pretty upset, especially when Gravity is paying 3.9 for their total? and debt. Any other comments - questions? I assume that someone is going to update a load forecast for Ketchikan, Wrangell and Petersburg. I would think that that needs to be done in order to figure up the end balance. We had a load forecast prepared in 1999 and I know that the subject came up in Wrangell and I offered to send them some additional copies since a lot of people had never seen it. This is it (held up copy of report) Done by the ISER, University of Alaska. No, we did not include going through another load forecast we just did it a year ago. Because of the limited time and budget, its always nice to get more, but no it's not part of the plan. The plan is to do the study and the economics based on looking at both the base and the high forecast for Wrangell and Petersburg, in terms of determining or estimating Tyee surplus availability in the future. And we'd be looking at the Ketchikan base forecast as the mid-range feasibility study. I have another question that ties right into that. When 20 10 11 12 13 14 15 16 17 18 19 Rg F& 8 BR DICK: DAVE: or who will do the work will be determining how Tyee and Swan will be operated? I don't assume you're go to have Ketchikan and in the best interest draw down Swan to uotning, ana then just takes a little bit of power out at Tyee as needed and I don't think that is very wise. Somewhere along the line you've got to coordinate two projects to run the most efficiently. In terms of the feasibility study - a detailed operational question like that is not going to be a determining factor in whether it is worth building or not. We don't have plans to look at that question. The closest to that that we're proposing or determining to look is what I just mentioned. Having a given estimate of what the savings would be from combined dispatched. But the detailed operational questions -- unless Beck gets into it because they find in reviewing this that they need to, I don't expect that it will I don't expect this to be -- for what you're doing now - - I don't expect that to be done either, but it seems like in the past a lot of the things that probably be looked at before you get a project built usually aren't and I know we are in the preliminary stages but hopefully as this thing progress at some time before’ the construction crew is on the ground, the Authority really does take look at that, because we can get hit with all 2A 10 11 12 13 14 15 16 17 18 Rg & 8 B DICK: DAVE: DAVE: DAVE: kinds of surprises. You know the Authority built the four projects, Tyee included, and then came to the communities and tried to negotiate a power sales agreement and that didn't work out very well for them obviously there we just don't want to repeat it. Yeah I understand. My reaction, what I'm thinking when I hear you say that is that I would expect that there would be substantial negotiations the way things look now with Ketchikan and also involving Wrangell and Petersburg as I was talking about in fact having to do with the wheeling rates and the priority for interruptable sales, what the priority order will be. It would seem to me that in that context those questions of operations would arise and could be dealt with at that time. I guess that I should make one last point, I personally don't believe this but there is a perception, some perception within this community that if you build a line to Ketchikan, by god Ketcnikan eventually is going to get that project. Now I don't believe that..... the Tyee project? a} atta tart the Tyee in other words when push comes to shove Ketchikan will being the bigger community and having more growth or clout will get the power. I personally don't believe that but I just want to make you aware that that perception does indeed exist, I guess I am just 22 10 11 12 13 14 15 16 17 18 19 Rg SF 8 B DICK: DAVE: DICK: DENNIS: DICK: cautioning you to be up front with the communities of Petersburg and Wrangell, keep the two communities involved in what you are doing like you're doing tonight, I think that would be very beneficial and keep some nasty things from happening down the road. I appreciate the advice. I don't know, do you have any suggestions what to do about it. I hear that and I say well the contracts don't see any loop holes, the lawyer assures you etc. and I don't know what more to do. It is a perception. You know Petersburg was drug through the mud literally with this long term power sales agreement and we don't want to loose what we have. I am just telling you what is out there and I certainly don't believe - I think our contract is legitimate ... but put two attorneys in a room and you know what is going to happen. I think that our contract is pretty iron clad - with a few loop holes that have to be worked out. It seems as though a wheeling agreement with Ketchikan at such time as it was negotiated could strengthen that - with some explicit language. Dick, right now this evening all you're specifically talking about is strictly the intertie between Tyee and Swan Lake. Is that correct? No other intertie, no other transmission lines. Well that is all that this study that prompts this 23 10 11 12 13 14 15 16 17 18 19 ® & 8 B DENNIS: DICK: DENNIS: DICK: meeting is about. So I'll save my comments. If it is something relevant..... Varehy a well Bradfield and that transmission line going up possibly to B.C. the mining area and possibly the intertie with the B.C. hydro grid. That is an ideal location to tie into -- go about eighteen miles away from the mine area. They're not fighting that and it should transpire that would give us our tie into that grid - it's a long range policy - so just- but for stability right now on generation I can tell you right now the way the frequency is running for the voltage run at and to stabilize the bars on the right now for example Petersburg is loosing X amount of kilowatts out of Crystal Lake because we are supporting the bars on the Tyee system. If you intertie both the Tyee and the Swan Lake together then there would be support on the bars, where as right now we've sort of -- on a mutual agreement are supporting the bar activity on the Tyee system with our Crystal Lake. And at the same time what is happening there we are loosing our kilowatt usage out of Crystal. That is a subject that has me confused I have talked with Ansel Conn our electrical engineer about that and I'm still confused. We will go from there. That will help stabilize the system. 24 10 11 12 13 14 15 16 17 18 19 Rg & 8 B BOB SCHWARTZ: of the Petersburg Utility Board: at what stage of DICK: BOB: DICK: this development is this situation going to be taken up with Ketchikan as far as what is going to transpire in a usage of that line. What stage of your programming? We were not able to meet with the -- to hold a public meeting in Ketchikan this trip because their City Council is wrapped up in budget meetings so now we are now scheduling a public meeting similar to this for Ketchikan the week of January 20th. ere pees | eee ae interaction with a gathering in the city. I don't know if that is what you meant? Well) | no |\what)|I|\wae |) wondering) is)|in) regards) |\to the agreement to who is going to get the power. At which stage in this development do we start working on that idea "who's going to get how much power" and what the price is going to be and the benefits of it or whatever the case may be - at what stage in this development is this going to take place? I would think - not having discussed with anyone, but I would think that we would not get into negotiations with KPU on the wheeling agreement at least until such time as we have a project authorization and what appears to be sufficient funding from the legislature to make the thing go!) Once) thats) done)/I)/-- it) seems to) me that it would be well to begin at that point the negotiations on 25 10 11 12 13 14 15 16 17 18 19 Rg & 8 B BOB: DICK: BOB: DENNIS: DICK: a wheeling agreement. That would specify a formula on whatever it is - what rate they would buy power delivered to Ketchikan and all of these other issues that you have been talking about the order of priority. So I wouldn't anticipate that would happen at least until authorization and funding - probably while these environmental studies are going on we would be initiating those negotiations that would be my best guess. We would be notified though? Oh yeah. And have plenty of time to gather some ammunition and what not. Dick, this is Dennis again, speaking. I guess this evening we are mainly looking at the environmental issues and -- on this particular portion of the study, I guess my problem as everyone else here, we are more or less getting into the operation portion of that and also negotiations of the wheeling agreement, more than we are mainly the environmental issue. I guess rom my perspective the specific environmental issues - I don't see any, but I can specifically see is the operational situation and negotiation with our wheeling agreements and how (indiscernible) Well that's fine that's basically what I see this evening. However, we're here to talk about anything. 26 10 11 12 13 14 15 16 17 18 19 ® SF 8 B DENNIS: ED: I think I can still catch a steelhead in Eagle River if we build transmission lines. They are going to be high enough when I cast (small talk and laughter back of room) A lot of it 3000 feet over should be high enough. I guess from what I have heard not here this evening so much but what I heard from the Forest Service and a little bit from Fish and Game, I don't know at this moment of any environmental issue that would preclude that line. That very early at saying that but there isn't any red flag jumping up that are real obvious. There are some concerns but they seem to all have engineering answers, there are ways to get around the environmental problem or to minimize the environmental problem that's the advice that I have been getting so fan. PAUL ANDERSON: (City Council) Basically I think there is more ED: PAUL: DICK: environmental concerns in the Ketchikan area than there is up here in Wrangell and Petersburg area. I know you haven't had a meeting... I have not talked to the Forest Service down there, we talked on the telephone but I haven't had a chance to sit down with them and spend any time on that yet. And do you foresee joint meetings with Wrangell, Ketchikan and Petersburg at all? Not for this study - no. 27 10 11 12 13 14 15 16 17 18 19 SRI eH MES PAUL: DICK: PAUL: DICK: ED: DICK: But there will be public meetings if anyone would like to fly from here to Ketchikan. Well, we got this..... What we tried to do is schedule a public meeting in each of the three communities and so..... The reason I said that you said there were different concerns in Wrangell and Petersburg and these concerns may not be the same as the concerns that they have down in Ketchikan. Rather than reading them in the paper, it could be nice to hear what their concerns are. One of the things that we are doing is we are preparing a synopsis or summary of each of these public meetings and sending that to whoever signs in. The Wrangell summary was going to be sent to the Wrangell list and the Petersburg summary was going to be sent to the Petersburg lasts But I don't know of any reason why we couldn't send all of them to everyone, do you? No So lets do that MAX WORHATCH: ..... I would like to ask a guestion about your DICK: environmental thing. Through your past history if you are doing a 90 days study how much static do you get from the environmentalist you probably don't get any in this stage yet do you? It is hard to say - I was involved in a study of a proposed power line from Palmer out to Glennallen along 28 10 11 12 13 14 15 16 17 18 19 ® & 8 B DENNIS: DICK: ED: MAX: DICK: the Glenn Highway and we got in real hot water, real fast with the people along the roads. Sheep Mountain? Sheep Mountain and Barnes, and .. so sure you never know. Of course in that case the line was going to go past communities and residences and what not, so it is somewhat different but, you just don't know. If somebody's favorite place is somewhere along that red line that really doesn't want to have this disturbance in their favorite place I am sure that we're going to hear from them somewhere along the line. You haven't heard anything from Wrangell yet and you haven't heard anything from Petersburg? No - nobody came to - City Council No nobody came. BRIAN LYNCH: Yeah I'm Brian Lynch, also a member of City Council, ED: BRIAN: I also work for the Fish and Game. And your study -- we will see that. And we will be reviewing on the study itself. Right now its somewhat from our stand point it's somewhat premature -- other than getting some basic input in there and we will be looking at this from my daily work . I will hand see to things too with the jobs which you are probably going to see. In much greater comment on getting entries during the fill out that channel if that 29 10 ll 12 13 14 15 16 17 18 19 Rg SF 8 B ED: DAVE: DAVE: there in Carroll..... I talked to Jack Gustofson on the phone the other day and he was the one who alerted me to some of the water fowls concerns that evidently these things have if they are not engineered right not set on the ground properly have the ability to interfere with bird migrations and that kind of thing. He didn't say he couldn't do it it was just some thing to think about and in sight so that you avoid this problem. But that's wasn't why I called a adverse comment it was what I would call some pretty technical advise. We will also meet with I assume with the Fish and Game office in Juneau when we meet with the State agencies in Juneau next fall we may get some direction there. Question? You know the Ketchikan Borough I believe is in the process or has done a study during the transmission corridor which would include the transmission line and also a the road. Have you had any interface with them - - is this study interfacing with their study at all? Or are they just going off in separate directions? Here's what's been done. It says the City or Borough whichever of Ketchikan was granted a Hundred Thousand Dollars to Alaska DOT fund to do a road reconnaissance study. As I understand it DOT Fund issued using that money using a Fifty Thousand Dollars contract by R & M 30 10 1 12 13 14 15 16 17 18 19 Rg S 8 B Engineering. To basically come up with a good selection and cost estimate a reconnaissance level design. R&M Engineering was supposed to issue their report by the end of this month. We were aware of that and one of the things that we did was since R & M was out there poking around in this corridor as soon as we got the money for the feasibility study the energy authority entered a contract with R & M to go out and do some geo-technical surveys along that same corridor before the weather closed in, which they did so we were able to use the fact that they were out there in the field and use their knowledge of the corridor to get some geo-technical data and to get some maps so there is three maps up there on the wall that are from R & M Engineering and they show what at the time their plans are proposed road routes and the intertie corridor as it is contemplated now. So we kind of piggy backed a little bit on the fact that there's this road study going on. Also we had set in our scope of work for this intertie study that Beck was to review whatever this study is that comes out through R & M. In their proposed road route, recommended road route is significantly different from the intertie corridor that we've been looking at in the past we wanted to take a look at that alternative to see if that provided any advantages that we should be aware of. It OL 10 11 12 13 14 15 16 17 18 19 & & 8 BS DENNIS: DICK: DENNIS: DICK: DENNIS: DICK: ED: DICK: DAVE: appears however that the recommended route will be the same, basically the same. So that is kind of the extent of it. This is Dennis, were you aware that KPU also put ina contract with RW Beck to look at the route and (indiscernible) I'm aware that KPU gave Beck a contract more or less, again eight months ago something like that, and Beck produced a thin report is that what you're referring to? Small, thin mainly a maintenance road-type situation you know in conjunction with the transmission line can not be the type of road - intended. Yes that type of road, again it is my understanding there was not a maintenance road that was associated with the intertie was viewed as a -- basically a recreation road and a path for people to assume there is a Bradfield road and get back and forth to Canada. That was zoned? No that was (indiscernible simultaneous talking) There were two different studies to my knowledge that one was RW Beck employed by Tyee and the other was R&M Engineering employed by Ketchikan Borough. Well R&M was funded by the Ketchikan Borough through DOT fund was $3,000. We're aware of them both. But this proposal here - and I think this is worth 32 10 ll 12 13 14 15 16 17 18 19 ® & 8 B DICK: ED: DICK: restating - states that helicopter type of construction with no -- whatever kind of road you want to call - is that correct? What we have directed Beck to do is come up with a cost estimate for the intertie assuming no road -- but we have also asked them to estimate what capital cost savings there would be if a road were built along the same corridor. If a road were built before intertie construction there would be some minor capital cost savings and whenever it were built there might or might not be significant O and M savings depending on assumptions as to whether the thing were maintained i the winter and how close it was to the line and all pi estimates of those possible impacts. But the proposal that we're pursuing is intertie only there will be n environmental analysis of the road, there'll be sorts of thing but in any event we've asked them to i economic analysis of the road. It's not part of ou scope. Just one other little minor item, we're looking a Forest Service transportation plan if the have planne any logging roads in this area..... Yes that's a separate issue. We're asking the Fores Service whether they have any plans to construct loggin roads particularly on Revillia Island we understand fro 33 10 ll 12 13 14 15 16 17 18 19 ® & 8 B our meetings with them in Wrangell and Petersburg that there are no plans for logging roads along Eagle River valley. ED: Any more questions, comments, concerns? DAVE: Don't designed, the transmission line like you did (indiscernible mumble) DICK: What do you have in mind? What do you want us to avoid? DAVE: Frying some poor fisherman with a conductor when he's trying to fly fish (laughter) DAVE: Maybe you're not aware of the problem here but our lines are faulting out on the ground DICK: Well actually I have heard that - I'm not really aware of it - I just hear it in the halls DAVE: That's true ED: That the Tyee lines out there? Is that because the lines are too close to the ground in some way or what? DAVE: The initial design -- the designed it for no loading I guess they figured down in the lower 48 you've got to be above 30060 feet before you have to put in an ice loading factor in there. And they didn't take that into consideration -- we have considerable icing problems here the lines load up with ice DICK: The icing situation caught them by surprise and I know that I've mentioned that - icing and the whole 34 10 11 12 13 14 15 16 17 18 19 g &S& 8 B ED: DICK: DAVE: DICK: climatological thing to Beck a number of times as something to cautioned about that Is that one of the reasons we want a lower elevation route -- I'm sure part of it Absolutely You also got memo that Dryden Larue report on what their planning on doing with the transmission line here and its got a lot of information in it Actually AEA has it but I hadn't thought about providing it to Beck - I'll make a note, Dryden LaRue Report - Tyee line report get them a copy of that. Are we talked out or what? (Genial conversations started between attenders) End Meeting 35 10 ll 12 13 14 15 16 17 18 ® & 8 B COESRIL) Ey Cla Er STATE OF ALASKA ) ) ss. First vuuiclal District } I, Sammy Parker, a Notary Public in and for the State of Alaska, residing at Petersburg, Alaska, do hereby certify that the herein transcript of the Public Meeting taken at the request of the Alaska Energy Authority, was taken before me on the 6th day of December 1991, having assembled at the hour of 7:00 P.M. thereof, at the City Council Chambers, Petersburg, Alaska; I further certify that this transcription was by me personally, electronically recorded from the said Public Meeting, and in the presence of the Attenders; I further certify that the original cassette tape recording of this transcription has been retained by me; IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal this 13th day of December, 1991. Notary Publye for the Sta of Alaska My commissfon expires: @2/18/92