HomeMy WebLinkAboutSoutheast Conference Southeast Alaska Electrical Intertie System Plan Report #97-01 January 1998Southeast Conference
Southeast Alaska
Electrical Intertie
System Plan
REPORT #97-01
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_ January 1998 <x vanaeesconanee ll
23 January 1998 An
Mr. Berne C. Miller
Executive Director
Southeast Conference
213 Third Street, Suite 124
Juneau, Alaska 99801
Dear Berne: Southeast Alaska Electrical Intertie System
Transmittal of Final Report # 97-01
Weare pleased to provide this final report to the Southeast Conference and the Participants
in the proposed Southeast Alaska Electrical Intertie SYSTEM. It has been a privilege and
an honor to work with you and representatives of the participating municipalities and utilities
on this assignment. We are grateful for this opportunity and we sincerely wish you and the
communities who will benefit from an interconnected electrical system our very best as you
take the vision that is presented in this report forward to reality. We would be honored to
continue to serve the region and look forward to a continuing relationship with you.
Yours very truly,
Wun A. Waldo
Nan A. Nalder
Project Manager
enc.
ACRES INTERNATIONAL CORPORATION
3254 Eleventh Avenue West. Seattle, Washington 98119
Telephone 206-281-7089 Facsimile 206-213-0652 Email sea@acres.com
Southeast Conference
Southeast Alaska
Electrical Intertie
System Plan
REPORT #97-01
January 1998 Acres Intemational Corporation ACES
Table of Contents
List of Tables
List of Figures
Glossary of Terms and
Acronyms
Executive Summary
1 “White Paper” Prepared
by Participants
2 Purposes and Objectives
3 Approach and Proposed
System Development
Phasing
4 Need for System
5 Existing Electrical
Transmission and
Generation Facilities
6 Status of New Facilities
Development
Table of Contents
ETE el Pi ET EE PAE Sa tg EMU SS OE 1-1
2 Purposelece eee rye etrelttoctterrelsacieneicteli iors 2-1
22s Objectives) sei teeters ate Une seal lieth a esel aden atte este 2-2
Feo e eee ee ee eee ee ee eee aes Meet etehe He eels 3-1
4.1 Demographics and Local Economy .......................5. 4-1
4°27) Financing the SYSTEM eee eee eee ene 4-5
4.3 Joint Regional Planning and Implementation................... 4-5
4.4 Future Electric Generation Resource Development .............. 4-6
4.5 Future Growth and Need for Improved Services in Southeast Alaska 4-6
4.6 Electric Rate Equalization and Regional Economic Stability ....... 4-7
5.1 Existing Electrical Transmission Segments .................... 5-1
5.2 Existing Hydropower Generation Facilities.................... 5-1
6.1 New Intertie Segments Development ....................-..- 6-1
6411) yee-Swan)Intertie see ce ec clare rathoeeistterattete re 6-1
6512) Upper Lynn Canaliintertie) ee rs sierstalt svelte oktroiele 6-1
6.1.3 Interties on Prince of Wales Island ..................... 6-1
6.2 Current Status of New Generation Facility Development ......... 6-2
6:2! Goat ake eyes eye ee rte rete easter yale iale aaa 6-2
(6'2:2;Mahoney) Lake) A/5) 5). laa) seis seisiers coco aia: 41: 6-2
6.2.3 Ketchikan Small Hydro Additions...................... 6-2
6.2.4 Metlakatla Small Hydro Upgrades/Additions ............. 6-2
Acres International Corporation
Table of Contents
7 Action Plan
8 References Cited and
List of Preparers
7.1 Proposed Phasing of Development ..............---5.00..... 7-1
7.2 Regional Electrical Interties ..................00 2200 e cue. 7-2
7.2.1 Proposed Intertie Segments and Estimated Cost ........... 7-2
7.2.2 Review of Existing Reports .............--0eeeeeeeeee 7-7
13 Regional Generation ias5.¢qen ee = Sere 7-7
7.3.1 Potential New Hydropower Projects .................... 7-9
7.3.2 Proposed Phasing of New Hydroelectric Projects ......... 7-12
7.3.3 Review of Existing Reports - Hydropower Projects ........ 7-14
7.4 Economic and Financial Issues.................0..0000005 7-15
7-4.\ Economic Parameters)... «<0: annvewwsmrss ss. 7-15
7.4.2 Electric Load Characteristics and Forecasts ............. 7-16
7.5 Environmental and Regulatory Procedures ................... 7-22
7.5.1 Reconnaissance Level Review - "Fatal Flaw Analysis" ..... 7-23
7.5.2 Formal Licensing and Permitting Requirements........... 7-23
7.5.3 Environmental Protection, Enhancement, and
Mitigation Requirements ..................0...00005 7-25
7.5.4 Review of Existing Reports - Environmental and Regulatory
Procedures roo re ee 7-26
7.6: Recommendations Sirrae crane oe er 7-28
8.1 References Cited ............. ccc cece eee e ees e sce eees 8-1
8:2 -Listiof, Preparers s.7000 ates ar ee 8-3
Acres International Corporation
Table of Contents
Table 4.1
Table 4.2
Table 4.3
Table 5.1
Table 5.2
Table 5.3
Table 5.4
Table 5.5
Table 7.1
Table 7.2
Table 7.3
Table 7.4
Table 7.5
Table 7.6
Table 7.7
Table 7.8
Table 7.9
Figure |
Figure 2
List of Tables
Private Sector Industry Trends in Southeast Alaska 1990-1996 ...... 4-3
Government Employment Trends - Southeast Alaska 1990-1996 ..... 4-3
Recent Population and Local Employment Trends for
Selected Southeast Alaska Communities .....................00.. 44
Existing Transmission Lines and Major Interconnections over 34.5kV .. 5-2
Existing Transmission Lines Design and Operating Capabilities ....... 5-2
Generation Capacity and Net Generation by Section ................ 5-3
Existing System Hydro Generation Sources ...................... 5-3
Existing RESOUrces)) ella: lata /alai a lotelarmietetin A talele ce leteler te el ee etal tla a eile 5-4
Proposed Sequencing and Cost Estimates for Southeast Alaska
Transmission Grid Segments .............00. 0000 cece eens 7-3
Documents Reviewed - Potential New Transmission................ 7-8
Potential New SYSTEM Hydroelectric Projects ................... 71-9
Documents Reviewed - Potential New Hydroelectric Projects ........ 7-14
Annual Fixed Carrying Charges - Alaska Power Authority Guidelines
Employed in 1987 Southeast Alaska Transmission Intertie Study ..... 7-15
Load Growth Projections for Participating Communities Average
Annual Growth Rate 200.0... eee eee 7-17
Typical Licensing and Permitting Requirements for Transmission Lines
and Hydropower, Projects <)3.0)4)os)sjseisjansniacseesemeta cle ale 7-25
Typical Environmental Protection, Enhancement and Mitigation
Requirements Transmission Line Segments and Hydropower Projects .. 7-26
Level of Investigation Performed as of November 1997 Proposed
Transmission Segments and Hydroelectric Projects ................ 7-27
List of Figures
Electrical Intertie System Plan
Electrical Intertie System Plan - Loads and Resources
Acres International Corporation
Acres
ADEC
ADFG
AEL&P or AELP
APA
AP&T
CBJ
CBS
DCRA
emp
Gw
GWH
HLP
IC
ISER
KPU
kV
KW
KWH or kWh
“lower 48"
MP&L
mi
MW
MWH or MWh
NA
1996$
OH
PCE
PMP&L
pop
SED
“take or pay”
THREA
USFWS
USFS
WML&P
Glossary of Terms and
Acronyms
Acres International Corporation / Acres International Limited
Alaska Department of Environmental Conservation
Alaska Department of Fish and Game
Alaska Electric Light & Power Company
Alaska Power Administration
Alaska Power & Telephone
City and Borough of Juneau
City and Borough of Sitka
Department of Community and Regional Affairs
Employment
Gigawatt (1000 megawatts)
Gigawatt Hours (1000 megawatt hours)
Haines Light & Power
Internal Combustion
Institute of Social and Economic Research, University of Alaska, Anchorage
Ketchikan Public Utilities
Kilovolt (1000 volts)
Kilowatt (1000 watts)
Kilowatt hours (1000 watt hours)
Phrase commonly used in Alaska to refer to the 48 contiguous states, United
States of America.
Metlakatla Power & Light
Miles
Megawatt (1000 kilowatts)
Megawatt hours (1000 kilowatt hours)
Not applicable
Estimate expressed in value of the US dollar in 1996
Overhead - refers to above ground transmission lines
Power Cost Equalization Program
Petersburg Municipal Power & Light
Population
Sitka Electric Department
Contract provisions that require the purchaser to pay for the amount of power
requested regardless whether the purchaser takes delivery and uses the
power or not.
Tlingit-Haida Regional Electrical Authority
United States Fish and Wildlife Service
United States Forest Service
Wrangell Municipal Light & Power
Acres International Corporation Iv
Executive Summary
The purpose of this report is to present technical information in support of a
proposed electrical intertie system to interconnect presently remote isolated
load centers; increase system reliability; reduce or avoid diesel dependence;
encourage economic development; and stabilize and equalize power rates.
This report presents a proposed SYSTEM Plan to assess final feasibility;
prepare detailed design and construction documents; and construct and operate
an integrated electrical intertie system in Southeast Alaska.
"The communities of Southeast Alaska support the concept of a
southeast electric grid as a means of reducing or avoiding diesel
dependence, encouraging economic development and stabilizing and
equalizing power rates. The communities intend to prioritize the
development of a regional intertie system, in accordance with
individual communities' power needs. The next step is to seek the
necessary funding on a partnership basis with the state and federal
governments." ("White Paper", July 1997, as revised in December
1997)
Southeast Alaska is comprised of thousands of islands known as the
Alexander Archipelago. The region offers significant natural resources and a
quality of life conducive to attract new clean economic development to the
area. With few exceptions, no roads or bridges connect islands. People travel
between islands by boat, floatplane, and/or wheeled plane. Current limitations
imposed by a lack of infrastructure and related availability of low-cost clean
energy restrict development of economic development and related
improvement in basic quality of life in the participating Southeast Alaska
communities. The participants have determined that an integrated electrical
transmission grid will enhance delivery of reliable and low-cost electric
service; and support development of an integrated energy, communications,
and transportation infrastructure to serve regional needs and attract new
economic opportunities to the region.
The communities, acting through the Southeast Conference, contracted with
Acres International Corporation (Acres) to prepare a Southeast Alaska
Electrical Intertie SYSTEM Plan (SYSTEM Plan) that integrates development
of proposed intertie segments with new hydroelectric generation capacity
designed to serve the needs of the region. The SYSTEM Plan provides a
"living" plan that can be updated as the participants proceed through
development of the SYSTEM.
Participating entities include: Alaska Electric Light and Power Company
(AEL&P), Alaska Power & Telephone Co. (AP&T); City and Borough of
Acres International Corporation ES-1
Executive Summary
Juneau; City of Kake; City of Ketchikan; Ketchikan Public Utilities (KPU),
Metlakatla Power & Light (MP&L); City of Petersburg / Petersburg
Municipal Power & Light (PMP&L); City and Borough of Sitka; Tlingit &
Haida Regional Electrical Authority (THREA); and City of Wrangell. Copies
of Resolutions in support of the Intertie System are included at Appendix A.
Southeast Alaska electric utilities currently operate isolated systems. The
existing electric transmission facilities in Southeast Alaska are a collection of
remote communities solely dependent on their own resources to meet load.
With the exception of existing connections between Petersburg and Wrangell
there are no interconnections to import or export power among Southeast
Alaska communities and electric utilities. The planned intertie between Swan
Lake and Lake Tyee will add Ketchikan to the Petersburg/Wrangell
interconnection. AP&T also plans to interconnect Skagway and Haines in
1998. Lacking transmission interconnections to other electric systems, each
utility must plan independently to provide full power requirements to meet
customer needs.
The opportunity to develop a regional system through joint planning will avoid
the need to come in later and try to fix problems similar to those inherent in
the interconnected systems in the "lower 48". Joint planning and system
operation will facilitate open access to regional SYSTEM facilities at fair and
non-discriminatory rates. SYSTEM ownership could be available to all
interested parties - utilities, municipalities, independent power project owners,
and large industrial customers. Users of the SYSTEM would fund operation
and future improvements. Joint ownership and operation would reduce the
potential for monopoly control and related potential discrimination, and related
costly lengthy litigation regarding alleged abuse of monopoly power, that have
restricted efficient use of existing facilities in the "lower 48." Southeast
Alaska provides an opportunity to "do it right" the first time by facilitating
development that requires joint planning and operation.
The challenge of competing in an ever increasing sophisticated marketplace
for sales of products demands a more efficient production and delivery system
and related infrastructure to support Southeast Alaska products. Increasing
dependence on computer based technology demands improved power quality
and integrated telecommunications / internet access services.
> Traditional and new industries will increase demand for energy production,
energy distribution systems, and a better transportation system for the
region
Es-2 Acres International Corporation
Executive Summary
» The ability to attract new industry and to modernize traditional industry is
dependent on enhanced telecommunications, fibre optic networks, internet
access, and efficient transportation systems.
> Existing hydroelectric projects are inadequate to serve future growth;
isolated load centers will site additional diesel generation to meet immediate
needs.
>» Communities need reliable, cost effective, long-term sources of energy for
the future that provide stable electric rates and employment and reduce
environmental impacts within the region.
One of the critical issues facing the Participants is availability of adequate
funds to Completing to support the level of professional engineering and
construction services and related physical features to construct the proposed
intertie SYSTEM. Participants recognize that a combination of State,
Federal, and Community funding will be required. Communities and utilities
would finance new generation facilities. Regional electric utilities will operate
and maintain SYSTEM transmission facilities. Sources of potential private
investment will also be explored.
The central policy question regarding future generation in Southeast Alaska is
whether it is better to continue to develop many load-specific small
hydropower projects and additional diesel generation units, or to develop a
long-term collective solution to meet future energy demand with larger
regional hydropower plant that develop the generation potential of sites with
fewer cumulative environmental impacts. Alaskans are interested in
protecting air quality and are therefore reluctant to continue to add fossil-fuel-
fired generation in highly scenic areas that draw tourists from around the
globe and provide a significant source of revenue to local communities.
Developing regional power projects to meet future demand will require a
regional grid.
Normally, the phasing of hydroelectric projects within a power system grid is
based largely on the estimated cost of each respective potential project. By
nature, hydroelectric projects are capital cost intensive and are generally very
site specific. The selected new projects have very similar characteristics
consisting of lake taps at perched lakes with tunnels of reasonable length
leading to powerhouses at tidewater. Therefore, development costs can be
expected to be comparable and consistent with others recently developed in the
region.
Accordingly, it is appropriate to phase project development on the basis of
projected needs for the intertie itself coupled with due consideration to the load
Acres International Corporation ES-3
Executive Summary
growth in the region as a whole. Thus, the intertie is the key factor in the
phasing of hydro generation projects. A regional intertie will enable full
utilization of each project as it would come on-line without the particular
needs of the respective nearby communities.
We interviewed leaders in a number of municipalities and utilities to identify
existing studies and plans, and discussed their vision and expectations for an
integrated regional electrical system. Based on our interviews and information
provided by the participants, review of existing documents, and our analyses,
we present this proposed SYSTEM Plan in five phases as discussed below and
as shown on Figures | and 2.
Figure 1, Southeast Alaska Utilities ELECTRICAL INTERTIE SYSTEM
PLAN, presents a map of Southeast Alaska depicting load centers, existing
and proposed new interties, and existing and proposed new hydroelectric
generation facilities. Figure 2, Southeast Alaska Utilities ELECTRICAL
INTERTIE SYSTEM PLAN: LOADS AND RESOURCES presents a
schematic diagram showing phasing of new generation as loads grow and the
transmission intertie SYSTEM is constructed.
PhaseI 1995 - 2010
Construct interties connecting Swan Lake and Tyee Lake hydroelectric
projects to Ketchikan Public Utilities' (KPU's) electrical system; and construct
an intertie connecting Metlakatla Power & Light to KPU's electrical system.
The Swan-Tyee intertie segment is expected to utilize current surplus
generation available from Lake Tyee. As shown in Figure 2, the existing
generation resources of the respective utilities in an interconnected grid will be
adequate to supply the gross annual loads of the system through the year
2010. Therefore, no additional hydroelectric resources are required during
this period. Preliminary cost estimates for development of intertie segments
specified during Phase I are $69,772,000/1996$ for the Swan Lake - Lake
Tyee Project and $8,785,000/1996$ for the Ketchikan Metlakatla intertie.
Estimated costs were presented in documents prepared by others and reviewed
by the Acres team during the course of this assignment and do not represent an
independent assessment.
Phase II
Construct interties connecting Sitka and Kake to Petersburg, Ketchikan and
Metlakatla. Again the existing resources match reasonable well the overall
loads of the interconnected system, thereby requiring no further hydropower
development through the year 2015. Preliminary cost estimates for
development of intertie segments specified during Phase II are $19,734,600/
1996$ for the Petersburg - Kake Intertie and $45,489,000/1996$ for the Kake
- Sitka Intertie. Estimated costs were presented in documents prepared by
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Executive Summary
others and reviewed by the Acres team during the course of this assignment
and do not represent an independent assessment.
Phase III
Construct interties connecting Angoon, Tenakee Springs, Hoonah, Green's
Creek and Juneau to Sitka, Kake, Petersburg, Ketchikan and Metlakatla
(North-South Grid). At this point the load growth for Juneau becomes the
major factor in determining the needs of the interconnected system. If mining
loads develop during the next few years, Lake Dorothy may be brought on-line
before 2015. Further, based on the load growth as projected for Juneau, the
system loads can also fully utilize the proposed Swan Lake project within the
2015 - 2020 time frame. Preliminary cost estimates for development of
intertie segments specified during Phase III are $173,788,000/1996$ for the
Tenakee Springs/Angoon/Hoonah/Greens Creek/Juneau Intertie. Estimated
costs were presented in documents prepared by others and reviewed by the
Acres team during the course of this assignment and do not represent an
independent assessment.
Phase IV
Construct interties connecting Skagway, Haines, and Kensington to North-
South Grid. Construct Takatz Lake Hydropower Project. By 2020, either the
Takatz Lake project or the Scenery Lake project could be added to the system.
Takatz Lake is shown on Figure 2 as a part of Phase IV on the basis of the
proposed road interconnection from Warm Springs and the transmission
system to Sitka as factors in reducing the environmental effects and cost of
development. Preliminary cost estimates for development of intertie segments
specified during Phase IV are $79,160,000/1996$ for the Juneau - Skagway
Intertie. Estimated costs were presented in documents prepared by others and
reviewed by the Acres team during the course of this assignment and do not
represent an independent assessment.
Phase V
Construct intertie connecting Prince of Wales Island to North-South Grid.
With this addition in 2025, the cumulative load projections of the respective
communities indicate that the output of Scenery Lake would be fully utilized
in its first year of operation. Preliminary cost estimates for development of
intertie segments specified during Phase V are $39,089,000/1996$ for the
Ketchikan - Prince of Wales Intertie. Estimated costs were presented in
documents prepared by others and reviewed by the Acres team during the
course of this assignment and do not represent an independent assessment.
The general evolution of analyses presented in the 1987 Intertie Study is
entirely appropriate for the purpose of progressively narrowing down the
options to find the optimal development sequence. However, we identified a
Acres International Corporation ES-5
Executive Summary
number of specific concerns that should be questioned in further analyses, and
the need to elaborate on some of the cost functions used in the comparison of
proposed line segments. The main issue in developing an integrated electrical
system is optimal timing of transmission extensions, and ultimately the timing
of future generation additions. Recommended investigations and analyses to
complete this SYSTEM Plan include:
> Update information available and relied on in preparing this Report as noted
above.
» Review basic designs for transmission lines and substations presented in
existing reports for adequacy. Develop a level of detail adequate to provide
a stronger foundation for developing refined cost estimates.
> Develop generic designs for stand-alone diesel generation supply stations
and for backup generating stations. Use stand-alone stations in refined
Base-Case development plan; assume standby installation as grid is
extended to each community.
> Conduct a "fatal flaw" environmental assessment for each of the selected
line segments concurrent with engineering feasibility investigations to
determine whether an environmental issue of significant magnitude would
preclude construction and operation of a line segment, even though
reasonable mitigation measures could be implemented.
>» Update economic parameters and assumptions used in evaluating
alternatives presented in the 1987 Study and apply in future analyses
regarding the proposed Southeast Alaska Electrical Intertie SYSTEM.
> Prepare revised load forecasts for participating systems recognizing phased
development identified in this SYSTEM Plan. Identify potential new large
loads and determine each potential new large load's energy plan with regard
to self-generation and interconnection with local utility to provide backup.
Identify conservation program actions to be implemented by potential new
large loads.
> Investigate economies of scale available through multiple use corridors
- electricity transmission
- communications and fibre optics
- transportation
ES6 Acres International Corporation
Executive Summary
Proposed Sequencing and
Cost Estimates for PHASE NEW LINE SEGMENTS LOAD CENTERS
Southeast Alaska I Swan Lake - Lake Tyee (KPU, /nitial Draft Power Supply Petersburg, Wrangell Transmission Grid Planning Study, 1996) & Ketchikan
Segments 57 mi 138-KV line connects Swan-Tyee hydros
Status: Final EIS/ USFS Record of Decision issued 8/97.
Construction bids to be requested in late 1997.
Estimated cost: $69,772,000/1996$
I Ketchikan - Metlakatla (Alaska Power Authority, Southeast Petersburg, Wrangell,
Alaska Transmission Intertie Study, 1987) Ketchikan &
15 mi 34.5 KV line (14 mi OH / 1 mi submarine) Connect KPU's Metlakatla
Mountain Point Sub / Race Point, MP&L.
Status: Final documents to be prepared once Swan-Tyee line is
under construction.
Estimated cust: $8,785,000/1996$*
U Petersburg - Kake - Sitka Sitka, Kake, I-A - Petersburg - Kake (DCRA, Division of Energy, Kake- Petersburg, Wrangell,
Petersburg Intertie Feasibility Study, 1996) Ketchikan &
46.7 mi 69 KV (44.3 mi OH / 2.4 mi submarine) capable of Metlakatla
upgrade to 138 KV.
Status: 1996 update to 1987 appraisal level engineering /
environmental review.
Estimated cost: $19,734,600/1996$
II-B - Kake - Sitka (Alaska Power Authority, Southeast Alaska
Transmission Intertie Study, 1987)
55.4 mi 138 KV (20.2 mi OH /35.2 mi DC submarine) cable
Status: Reconnaissance engineering / environmental.
Estimated cost: $45,489,000/1996$*
m Sitka - Tenakee Springs/Angoon - Hoonah - Greens Creek - Sitka, Angoon,
Juneau (Alaska Power Authority, Southeast Alaska Transmission Tenakee Springs,
Intertie Study, 1987) Hoonah, Greens
148.6 mi 138 KV (120.8 mi OH / 27.8 mi AC submarine) Creek, Juneau to
Status: Appraisal level engineering / environmental review. Petersburg, Wrangell,
Estimated cost: $173,788,000/$1996* Ketchikan, Metlakatla (North-South Grid)
IV Juneau - Skagway (Alaska Power Authority, Haines-Skagway Connects Skagway,
Region Feasibility Study, 1981) Haines, and
70.5 mi (6.5 miles 69 KV OH / 64 miles 100 KV DC submarine) Kensington, north of
Status: Appraisal level engineering / environmental review. Juneau, to North-
Estimated cost: $79,160,000* South Grid
v Ketchikan - Prince of Wales Island (Alaska Power Authority, Connects Thome Bay,
Black Bear Feasibility Report, 1981) Kasaan, Klawock,
19 mi 69 KV or 115 KV (1 mi OH/ 18 mi submarine) Hollis, Craig, and
Status: Appraisal level engineering / environmental review. Hydaburg to North-
Estimated Cost: $ 39,089,000* South Grid
SYSTEM 243.8 mi OH/ 148.4 mi submarine
TOTALS 392.2 total miles
Construction Cost Estimate $435,817 ,000/1996
* Indicates cost prepared using standard cost curves to escalate earlier estimate.
ES-7 Acres International Corporation
SKAGWAY
HAINES.
yrs SM Snettisham
TENAKEE es Phase Ii >
& 2 fs. ANGOON _! mM REESE hs \; hg
SITKA Scenery Lake (Phase V)
Yar Swan Lake (Phase Ill)
f f oy PETERSBURG
shy, at LOAD CENTER
Existing Intertie
New Intertie yor FS SSN
“<p Phase ly) 3/ KETCHIKAN
SRENB) Poanag “ METLATAKA ~~
r
Figure 1
Southeast Alaska Utilities ACHES
ELECTRICAL INTERTIE SYSTEM PLAN
1,000 MWh
J =
1,400 - |
Average Annual Loads 1,300 ;
4.200 Average Annual Energy
, w/ Potential New Hydro
1,100
4.000 Average Annual Energy , w/ Existing Hydro
900 —
800 |
700 —|
600 —
500 |
400 —
300 ——|
200 —|
100 |
"TTT
1995 2000 2005 2010 2015 2020 2025 2030
Figure 2
Southeast Alaska Utilities ACHES ELECTRICAL INTERTIE SYSTEM PLAN : LOADS AND RESOURCES
l
“White Paper” Prepared
by Participants
Section 1 “White Paper” Prepared by
Participants
Representatives from communities in Southeast Alaska met during 1997 with
the purpose of preparing a "white paper" on regional power generation and
distribution needs. The white paper focus is on a regional power grid
development plan for Southeast Alaska that is responsive to each community's
needs and time lines.
The Southeast Conference, an Alaska Regional Development Organization
and USDA Resource Conservation and Development Council, issued a
request for proposals to provide professional engineering services to update
and summarize information contained in the Southeast Alaska Electrical
Intertie & Transportation Corridors Study and other related documents on
June 20, 1997. Acres International Corporation (Acres) was awarded a
contract on August 5, 1997 to undertake this effort. The white paper set the
tone for this assignment and one of the requirements in the RFP was to
"Review paper and recommend changes needed to make paper agree with
results of this effort." (Section Four, Scope of Work, 4.2 Approach, item 1,
RFP # 97-01)
The July 1997 White Paper focused on a 20-year regional power grid
development plan. An initial draft of the report was presented to participants
and discussed at the September 1997 Southeast Conference Annual Meeting in
Petersburg. Following that meeting, participants provided additional
comments and also discussed the appropriate schedule for phasing
development of the regional power grid. During a December 1997 meeting in
Sitka, participants determined that the plan should not be limited to a 20-year
horizon as full realization of the proposed plan could extend beyond a period
of 20 years and participants determined that a flexible timeframe was more
appropriate. Acres revised the original draft of the report to address this
change in timeframe. The July 1997 White Paper was revised accordingly and
following this brief introductory section, readers will find a copy of the
December 1997 version of the White Paper with recommended changes as
approved by the participants. A list of participating communities is included
at the end of the text. Copies of resolutions passed by participating
communities are available upon request from the Southeast Conference.
Acres International Corporation 1-1
WHITE PAPER
SOUTHEAST ALASKA ELECTRICAL INTERTIE SYSTEM
July 1997, as Revised December 1997
Major economic and social changes are taking place in Southeast Alaska to minimize adverse impacts of those changes, and to
facilitate economic revitalization and diversification, adequate infrastructure is a must.
The most basic of infrastructure is electricity, because without adequate generation and transmission capacity, communities will be
unable to sustain services, let alone grow. Even other infrastructure, such as water and sewer facilities, is dependent on electricity.
Moreover, from an environmental impact standpoint, failure to construct a regional electric grid will result in increased local diesel
generation rather than taking advantage of the substantial hydro power potential that exists in Southeast Alaska. Building a
generation and intertie grid takes a long time, so a regional construction plan is needed now.
In 1987, the then Alaska Power Authority completed a study that identified a Southeast Alaska electrical grid system. The study
found that such a grid is both technically and economically feasible, with a twenty year planning horizon. Today, after a decade of
growth in demand and numerous studies confirming the need for this network, virtually none of these electrical interties have been
constructed. Last month, the communities of Southeast Alaska came together in Sitka to start getting the job done. The group
initiated efforts to develop a plan drawing heavily on work in the previous intertie studies.
At present, most every community in Southeast Alaska generates its own power in a largely isolated electrical environment. In an
area with rich hydroelectric potential, most smaller communities remain entirely diesel dependent. Even in larger communities
such as Juneau, Ketchikan and Sitka which currently have hydroelectric power, those facilities are reaching the limit of their
capacity and supplemental diesel power is being pursued or contemplated. This, despite the fact there is adequate hydroelectric
potential to serve all of Southeast for decades to come if an intertie system existed to transport power to the load centers.
The communities of Southeast Alaska therefore support the concept of a southeast electric grid as a means of reducing or avoiding
diesel dependence, encouraging economic development and stabilizing and equalizing power rates. The communities intend to
prioritize the development of a regional intertie system, in accordance with individual communities' power needs. The next step is
to seek the necessary funding on a partnership basis with the state and federal governments.
Participants Supporting a Regional Effort to Promote a 20-Year Power Grid Plan for the Southeast Alaska Region include:
> Alaska Electric Light and Power Company > Metlakatla Power & Light
> Alaska Power & Telephone Co. > City of Petersburg
> City and Borough of Juneau, Alaska > City and Borough of Sitka
» City of Kake > Tlingit & Haida Regional Electrical Authority
> City of Ketchikan > City of Wrangell
> Ketchikan Public Utilities
a
Purposes and Objectives
Section 2
2.1
Purpose
Purposes and Objectives
"The communities of Southeast Alaska support the concept of a southeast
electric grid as a means of reducing or avoiding diesel dependence,
encouraging economic development and stabilizing and equalizing power
rates. The communities intend to prioritize the development of a regional
intertie system, in accordance with individual communities' power needs. The
next step is to seek the necessary funding on a partnership basis with the state
and federal governments." ("White Paper", July 1997, as revised December
1997).
The communities, acting through the Southeast Conference, contracted with
Acres International Corporation (Acres) to prepare a Southeast Alaska
Electrical Intertie SYSTEM Plan (SYSTEM Plan) that integrates development
of proposed intertie segments with new hydroelectric generation capacity
designed to serve the needs of the region. The SYSTEM Plan provides a
"living" plan that can be updated as the participants proceed through
development of the SYSTEM.
Participating entities include: Alaska Electric Light and Power Company
(AELP), Alaska Power & Telephone Co. (AP&T); City and Borough of
Juneau; City of Kake; City of Ketchikan; Ketchikan Public Utilities (KPU);
Metlakatla Power & Light (MP&L); City of Petersburg / Petersburg
Municipal Power & Light (PMP&L); City and Borough of Sitka; Tlingit &
Haida Regional Electrical Authority (THREA); and City of Wrangell. Copies
of Resolutions in support of the Intertie System are included in Appendix A.
This report documents investigations and analyses conducted by Acres under
the terms of the August 5, 1997 Letter of Agreement with the Southeast
Conference pursuant to the Request for Proposals #97-01, Southeast
Electrical Intertie, as augmented in January 1998.
The purpose of this report is to present technical information in support of a
proposed electrical intertie system to interconnect presently remote isolated
load centers; increase system reliability; reduce or avoid diesel dependence,
encourage economic development; and stabilize and equalize power rates.
This report presents a proposed SYSTEM Plan to assess final feasibility;
prepare detailed design and construction documents; and construct and operate
an integrated electrical intertie system in Southeast Alaska. This report will
be used to brief legislators, Members of Congress, and other public officials;
and to inform residents in the communities and elicit their support for the
proposed Southeast Alaska Electrical Intertie SYSTEM.
Acres International Corporation 2-1
Purposes and Objectives
2.2
Objectives
In preparing this report, Acres interviewed federal and state energy officials;
community leaders; and electric utilities to elicit their interests and
recommendations and identify studies and plans that have been completed.
Studies and plans used in preparing this report are identified in the text. A
complete bibliography is included at Appendix B, Volume 2 and is available
from the Southeast Conference.
Develop a 20-year power grid plan for the Southeast Alaska Region
responsive to each community's needs and time lines that will enhance
opportunities to increase the region's economic base and result in regional
economic development opportunities that will provide a basis to achieve:
> effective and efficient coordination of the electrical resources and enhanced
reliability of electrical service through a regional power grid;
> clean renewable hydroelectric regional energy resources, thereby avoiding
increased environmental effects associated with additional diesel generation;
> an environment that will enhance opportunities to locate new commercial
and industrial business;
> lower cost hydroelectric power to communities now solely dependent on
diesel generation, thereby increasing opportunities to attract new business
and provide jobs to communities with high unemployment; and
> stable electric rates and cost equalization.
2-2 Acres International Corporation
3
Approach and Proposed
System Development Phasing
Section 3 Approach and Proposed
System Development
Phasing
The State of Alaska and the Federal Government have conducted numerous
reconnaissance level investigations and identified potential sites and corridors
for the development of hydroelectric power generation facilities and electrical
power grids throughout Southeast Alaska. This report draws on the content of
existing documents and, where necessary, includes updates to existing data
based on Acres' experience with similar projects. Original research and
analysis were not part of this assignment. Our purpose in developing this plan
was to confirm feasibility of a regional electrical intertie SYSTEM and to
identify logical steps to pursue development of grid segments and regional
hydroelectric generation facilities.
We interviewed leaders in a number of municipalities and utilities to identify
existing studies and plans, and discussed their vision and expectations for an
integrated regional electrical system. Based on these interviews, we
understand that the participants seek a flexible plan that presents logical steps
to take to get from here -- a set of preliminary documents -—- to an
interconnected electrical system that will serve the region's needs from a
number of perspectives. Data was requested of each municipality and utility
in the region regarding power generation and distribution needs, and plans and
load forecasts.
Based on our interviews and information provided by the participants, review
of existing documents, and our analyses, we present this proposed SYSTEM
Plan in five phases:
PhaseI 1995 - 2010
Construct interties connecting Swan Lake and Tyee Lake hydroelectric
projects to KPU's electrical system; and construct an intertie connecting
MP&L to KPU's electrical system.
Phase II 2011 - 2015
Construct interties connecting Sitka and Kake to Petersburg, Ketchikan and
Metlakatla.
Phase III 2016 - 2020
Construct interties connecting Angoon, Tenakee Springs, Hoonah, Green's
Creek and Juneau to Sitka, Kake, Petersburg, Ketchikan and Metlakatla
(North-South Grid). Construct Lake Dorothy and Swan Lake hydropower
projects.
Acres International Corporation 3-1
Approach and Proposed System Development Phasing
Phase IV 2021 - 2025
Construct interties connecting Skagway, Haines, and Kensington to North-
South Grid. Construct Takatz Lake Hydropower Project.
Phase V 2026 - 2030
Construct intertie connecting Prince of Wales Island to North-South Grd.
Construct Scenery Lake Hydropower Project.
Section 7 of this report presents further details of the proposed SYSTEM and
includes two figures which provide the following graphic representations.
Figure 1, Southeast Alaska Utilities ELECTRICAL INTERTIE SYSTEM
PLAN, presents a map of Southeast Alaska with a schematic diagram
superimposed to depict load centers, existing and proposed new interties, and
existing and proposed new hydroelectric generation facilities. Figure 2,
Southeast Alaska Utilities ELECTRICAL INTERTIE SYSTEM PLAN:
LOADS AND RESOURCES presents a schematic diagram showing phasing
of new generation as loads grow and the transmission intertie SYSTEM is
constructed.
Detailed Technical Analyses and Cost Information Appendices are available
upon request from the Southeast Conference.
3-2 Acres International Corporation
4
Need for System
Section 4
41
Demographics and
Local Economy
Need for System
Southeast Alaska is comprised of thousands of islands known as the
Alexander Archipelago. The region offers significant natural resources and a
quality of life conducive to attract new clean economic development to the
area. With few exceptions, no roads or bridges connect islands. People travel
between islands by boat, floatplane, and/or wheeled plane. Current limitations
imposed by a lack of infrastructure and related availability of low-cost clean
energy restrict development of economic development and related
improvement in basic quality of life in the participating Southeast Alaska
communities. The participants have determined that an integrated electrical
transmission grid will enhance delivery of reliable and low-cost electric
service; and support development of an integrated energy, communications,
and transportation infrastructure to serve regional needs and attract new
economic opportunities to the region.
Southeast Alaska electric utilities currently operate isolated systems. Lacking
transmission interconnections to other electric systems, each utility must plan
independently to provide full power requirements to meet customer needs.
Developing hydropower generation and major transmission projects requires a
long lead time and significant capital investment.
Population growth in Southeast Alaska has increased from approximately
65,000 to 75,000 persons over the ten year period 1986 - 1996. Annual
average employment increased during the ten year period from 29,000 to
36,000 persons. During this period the real average annual salary declined
from $34,000 to $30,000 and total payroll increased from $1 billion to $1.1
billion. Government accounts for over $800 million in annual personal
income in Southeast Alaska. (McDowell Group, Inc., 1997)
The three main load centers in the region are Juneau, Sitka, and Ketchikan.
Expansion of transmission grid legs as presented in the 1997 Report focused
on these three load areas. Recent trends for several of the participating
utilities are presented in a table following this text section.
The Southeast Alaska economy is built on timber, fishing, and tourism. An
increase in hardrock mining development is proposed, but as yet is not a major
factor. Communities are investigating "value-added" timber and fishery
products in order to expand these traditional industries. New industrial
development is being actively sought, however absence of an interconnected
electric system and improved transportation tends to discourage significant
investment in the region. (AEA 1990).
Acres International Corporation 4-1
Need for System
Tourism is identified as the industry sector exhibiting the most potential for
growth in the near term. Cruise passenger capacity is expected to increase
another 8% in 1998; total southeast visitor spending is approaching $ 200
million annually. Traditional timber and fishery industries in Southeast
Alaska are undergoing significant change, and in some cases closure.
National legislated mandates established the U.S. Congress and the
Administration will shape Tongass National Forest management over the near
term. Economic effects associated with pulp mill closures have devastated
certain communities. The forest products industry has lost 2,200 jobs since
1990, 300 jobs in 1996 and another 400 in 1997; over the seven year period,
industry payroll has dropped by $100 million. The forest products industry
expects 150 to 180 million board feet production annually in the near term, a
significant reduction than projected in recent years. The seafood industry
experiences mixed success depending on yield and market price. The mining
industry projections are mixed. Greens Creek is back in full production and
Kensington awaits improved gold prices before moving forward. The Niblack
project continues to show promise. Sealaska's project is currently on hold. The
proposed AJ project was scrapped. The government sector accounts for one-
third of all jobs in Southeast. Little or no growth is projected at the state and
federal levels; recent growth has occurred at the local level. The average
annual salary in the government sector is $38,000, significantly higher than
the private sector average of $26,000. Private sector industry trends during the
period 1990 to 1996 and government employment trends over the same period
are presented in the Tables 4.1, 4.2, and 4.3 following the text in this section
of the report. (McDowell Group, Inc., 1997)
The challenge of competing in an ever increasing sophisticated marketplace
for sales of products demands a more efficient production and delivery system
and related infrastructure to support Southeast Alaska products. Increasing
dependence on computer based technology demands improved power quality
and integrated telecommunications / internet access services.
» Traditional and new industries will increase demand for energy production,
energy distribution systems, and a better transportation system for the
region
> The ability to attract new industry and to modernize traditional industry is
dependent on enhanced telecommunications, fibre optic networks, internet
access, and efficient transportation systems
> Existing hydroelectric projects are inadequate to serve future growth;
isolated load centers will site additional diesel generation to meet immediate
needs
4-2 Acres International Corporation
Need for System
Table 4.1
Private Sector Industry
Trends in Southeast
Alaska 1990 - 1996
Table 4.2
Government Employment
Trends - Southeast
Alaska 1990 - 1996
Private Industry Sector Change Since 1990 Change 1995 - 1996
Construction + 600 + 150
Lumber & Wood Products - 1,300 + 300
Seafood Processing + 50 - 150
Transportation + 200 No Change
Retail Trade + 1,200 + 100
Services (ex. transportation) + 3,750 + 350
Source: Presentation Materials prepared by McDowell Group, Inc., for the Southeast Conference Annual
Meeting, September 18 - 20, 1997
Level Change Since 1990 Change 1995 - 1996
Federal -_ 100 No Change
State - 250 -_50
Local + 450 + 150
Source: Presentation Materials prepared by McDowell Group, Inc., for the Southeast Conference Annual
Meeting, September 18 - 20, 1997
Acres International Corporation 4-3
Need for System
Table 4.3
Recent Population and
Local Employment Phase / 1997 % Change 1990-97 Actual
Trends for Selected Community Population Population 96-97 %% Change —_ Population
Southeast Alaska Employment 95-96 __ Population Growth
Communities I/ Ketchikan 14,599 pop 0.9% 0.8% ™
emp -11%
I/ Petersburg 3,432 pop 2.3% pop 1.0% 225
emp -2.3%
I/ Wrangell 2,543 pop -2.0% 0.3% 64
emp -2.3%
I/ Metlakatla 1,595 pop 0.5% NA NA
emp NA
I1/Kake 167 pop 1.™% NA NA
emp NA
II/ Sitka 8,733 pop 1.2% 0.2% 145 emp 12%
I / Juneau 29,813 pop 1.0% 1.6% 3,062
emp 2.2%
II/ Angoon 571 pop -5.6% NA NA
emp -5.7%
I / Hoonah 906 pop 0.7% NA NA
emp 5.7%
IV / Skagway 816 pop 6.4% NA NA
emp 5.7%
IV / Haines 2,421 pop 2.0% 1.9% 304
emp 9.6%
V/Craig 2,043 pop -3.1% 7.0% 783
emp _ 0.3%
V/Klawock 704 pop -3.0% NA NA
emp ~0.3%
V/ Thome Bay 625 pop -3.1% NA NA
emp ~0.3%
Source: Presentation Materials prepared by McDowell Group, Inc., for the Southeast Conference Annual
Meeting, September 18 - 20, 1997
44 Acres International Corporation
Need for System
4.2
Financing the SYSTEM
4.3
Joint Regional Planning
and Implementation
>» Communities need reliable, cost effective, long-term sources of energy for
the future that provide stable electric rates and employment and reduce
environmental impacts within the region.
One of the critical issues facing the Participants is availability of adequate
funds to Completing to support the level of professional engineering and
construction services and related physical features to construct the proposed
intertie SYSTEM. Participants recognize that a combination of State,
Federal, and Community funding will be required. Communities and utilities
would finance new generation facilities. Regional electric utilities will operate
and maintain SYSTEM transmission facilities. Sources of potential private
investment will also be explored.
In support of its proposed request for federal support, the Participants state
that Southeast Alaska and its residents have bome a significant burden due to
federally imposed limitations on development of the State's natural resources
pursuant to Federal Legislation. These limitations have resulted in significant
reductions in traditional timber and fishing industries and related reductions in
local employment as discussed in the above section 4.1, Demographics and
Local Economy.
The existing electric transmission facilities in Southeast Alaska are a
collection of remote communities solely dependent on their own resources to
meet load. With the exception of existing connections between Petersburg and
Wrangell there are no interconnections to import or export power among
Southeast Alaska communities and electric utilities. The planned intertie
between Swan Lake and Lake Tyee will add Ketchikan to the
Petersburg/Wrangell interconnection. AP&T also plans to interconnect
Skagway and Haines in 1998.
The opportunity to develop a regional system through joint planning will avoid
the need to come in later and try to fix problems similar to those inherent in
the interconnected systems in the "lower 48". Joint planning and system
operation will facilitate open access to regional SYSTEM facilities at fair and
non-discriminatory rates. SYSTEM ownership could be available to all
interested parties - utilities, municipalities, independent power project owners,
and large industrial customers. Users of the SYSTEM would fund operation
and future improvements. Joint ownership and operation would reduce the
potential for monopoly control and related potential discrimination, and related
costly lengthy litigation regarding alleged abuse of monopoly power, that have
restricted efficient use of existing facilities in the "lower 48." Southeast
Alaska provides an opportunity to "do it right" the first time by facilitating
development that requires joint planning and operation.
Acres International Corporation 4-5
Need for System
4.4
Future Electric
Generation Resource
Development
4.5
Future Growth and
Need for Improved
Services in Southeast
Alaska
The central policy question regarding future generation in Southeast Alaska is
whether it is better to continue to develop many load-specific small
hydropower projects and additional diesel generation units, or to develop a
long-term collective solution to meet future energy demand with larger
regional hydropower plant that develop the generation potential of sites with
fewer cumulative environmental impacts. Alaskans are interested in
protecting air quality and are therefore reluctant to continue to add fossil-fuel-
fired generation in highly scenic areas that draw tourists from around the
globe and provide a significant source of revenue to local communities.
Developing regional power projects to meet future demand will require a
regional grid.
Communities need to improve services to attract new commercial and
industrial development to expand employment opportunities in an area where
the traditional logging, pulp, and fishing industries are in decline. A key
element is stabilizing electric rates so that communities are not disadvantaged
due to lack of access to hydropower generation. Competitive electric rates are
essential to local regional development.
The transmission infrastructure needs to be linked with development of
improved transportation to and within Southeast Alaska. Improved access
will attract new product-oriented industry, improve tourism opportunities,
enhance interaction between communities in Southeast Alaska, and generally
improve the lifestyle of residents by enabling them to travel for business and
personal needs on a reliable and timely basis.
A regional dedicated utility corridor could accommodate regional and energy
transmission/transportation (electricity, fibre optics, and natural gas) and
multi-modal transportation. This report addresses electricity transmission and
notes the community preference to expand corridor use to provide
transportation opportunities. We understand that the Southeast Conference is
exploring opportunities to perform a similar review regarding transmission in
Southeast Alaska. We also note that the State of Alaska Department of
Transportation has embarked on an examination of multi-modal transportation
needs in Southeast.
The potential to serve new large mining and related industrial loads in the
region and across the border in Canada will also require expanded
transportation and electric transmission infrastructure and additional
generating capacity. Proposals to open the Kensington and Jualin mines north
of Juneau are currently being considered. Greens Creek Mines has already
installed its own diesel generation sources. The direct energy requirements for
mining are assumed to be 60 million KWH/year for the Kensington mine, and
4-6 Acres International Corporation
Need for System
4.6
Electric Rate
Equalization and
Regional Economic
Stability
20 million KWH/year for the Jualin mine. "Take-or-pay" provisions in power
contracts with the mines will mitigate the economic risk of developing major
new resources associated with mining operations.
From a public policy perspective, the need to enhance local communities'
ability to maintain an appropriate level of economic well-being is a primary
interest. During the interviews with local communities, the high
unemployment and lack of potential to maintain existing and attract new
industry and related employment opportunities, were identified as motivating
factors to construct an interconnected system so that lower cost power could
be provided to these communities. The Alaska Electric Power Statistics -
1960-1995 at page 85 presented cost comparisons for 1995 typical monthly
electric bills at varying levels for residential customers. Figure 3 and Table
4.1, based on statistics from the above noted document, depict the range from
high to low for communities included in this analysis.
Acres International Corporation 4-7
S
Existing Electrical Transmission
and Generation Facilities
Section 5
5.1
Existing Electrical
Transmission
Segments
5.2
Existing Hydropower
Generation Facilities
Existing Electrical
Transmission and Generation
Facilities
Existing transmission facilities in Southeast Alaska were constructed to
deliver power from generation to specific load centers. Due to the remote
locations, many communities are situated on islands, and lack of electrical
interconnections among locations, electrical utilities in Southeast Alaska
operate their systems to deliver power to their customers and do not have
opportunity to import power from other systems to meet electric customer
needs. Ability to construct an interconnected system is exacerbated by these
remote locations and rough terrain. The one current exception is the
interconnection between Lake Tyee and municipally owned and operated
electric utilities in Petersburg and Wrangell who share output from the Lake
Tyee Project. Nearterm planned interconnections include the intertie between
Swan Lake and Lake Tyee that would connect KPU to Petersburg and
Wrangell and a planned submarine interconnection between Skagway and
Haines to share output of the planned Goat Lake Hydroelectric Project.
In 1995 there were approximately 320 total transmission circuit miles in major
load centers in Southeast Alaska: 20 miles @ 25 KV; 25.0 miles @ 34.5 KV;
80 miles energized @ 69 KV, built @ 138 KV; 120.5 miles @ 120.5 KV; 30
miles @ 115 KV; 44 miles at 138 KV. Areas covered by these statistics
include Snettisham/Crater Lake, AELP, Sitka Electric System, KPU, and
Swan Lake / Tyee Lake. Tables 5.1 and 5.2 provide detailed information
regarding these existing facilities.
Existing hydro projects in Southeast Alaska are identified in two categories:
(1) developed by local utilities to serve local load, and
(2) system hydroelectric projects developed by the State of Alaska or the
Federal Alaska Power Administration to serve shared interconnected load
centers. Existing hydro projects constructed by utilities to meet specific
loads are located in Skagway, Juneau, Sitka, Petersburg, Ketchikan,
Metlakatla, and Prince of Wales Island. Existing system hydro electric
projects include: Snettisham/Crater Lake, Lake Tyee, and Swan Lake.
Figure | shows existing system hydropower units and transmission
segments; and proposed new system hydropower units and transmission
segments. Table 5.3 presents generation capacity and net generation by
sector; Table 5.4 lists federal and state-owned hydro generation sources;
and Table 5.5 lists all existing generation facilities by utility.
Acres International Corporation 5-1
Existing Electrical Transmission and Generation Facilities
Areas served by system hydro projects currently maintain backup diesel
capacity equal to 100% peak demand. Diesel units cover emergency
operation, peaking requirements, voltage regulation, or meet remaining load
requirements not available from the hydro projects. Areas not interconnected
to a system hydro project currently maintain diesel capacity equal to 125%-
130% of the peak load depending on the ratio.
Table 5.1
Existing Transmission Lines and Major Interconnections Area Circuit Voltage Circuit over 34.5 kV ee eee
Juneau (APA & AEL&P)
Snettisham/Crater Lake - Thane (Federally owned) 138 44.0
Thane - Capital Avenue Sub 69 5.0
Thane Loop Sub (Mendenhall Valley) 69 17.0
Upper Mendenhall Bridge - Auke Bay - 69
Brotherhood Bridge
Sitka Electric Department
Blue Lake - Sitka and through City 69 5.0
Green Lake - Blue Lake 69 9.0
Ketchikan Public Utilities
Silvis Lake - Beaver Falls - Ketchikan and
through City to North Point Higgins Sub 34.5 25.0
Swan Lake - Ketchikan (State owned) 115 30.0
Petersburg - Wrangell
Tyee - Wrangell 69* 39.0
Wrangell - Petersburg 69° 42.0
* Line is built to 138 kv standards.
Table 5.2
Existing Transmission Line
Design and Operating Area Designed Operated
Capecmliss Juneau - Snettisham/Crater Lake to Thane 138 KV 138 KV
Juneau - Annex Creek to Thane 23 KV 23 KV
Juneau - Thane to Juneau 69 KV 69 KV
Sitka 69 KV 69 KV
Tyee to Petersburg/Wrangell 138 KV 69KV
Petersburg 25 and 138 KV 25 and 69 KV
Petersburg to Wrangell 138 KV 69 KV
Wrangell 25 and 138 KV 25 and 69 KV
Ketchikan - Swan Lake to Bailey 11ISKV 11ISKV
Ketchikan - Higgins to Silvis 34.5KV 34.5KV
5-2 Acres International Corporation
Existing Electrical Transmission and Generation Facilities
Table 5.3
Generation Capacity and
Net Generation by Sector Sector Installed Capacity Net Generation Net Growth
(KW) (MWh) 1994 - 1995
Utility 344,093 714,950 4.0%
U. S. Coast Guard 1,500 0 0.0%
Industry 90,184 202,481 -14.1%
TOTAL 435,777 917,431 0.6%
Table 5.4
Existing System Hydro
Generation Sources Plant Installed Capacity Average Annual
(MW) Generation (Mwh)
Snettisham 46.0 216,000
Crater Lake 27.0 118,000
Tyee Lake 20.0 114,100
Swan Lake 22:5 85,400
Total 115.5 533,500
5-3 Acres International Corporation
Existing Electrical Transmission and Generation Facilities
Table 5.5
Existing Resources
Project Name / Location Fuel Type Installed
Capacity
Alaska Electric Light & Power Company
Annex Creek Hydroelectric 3,600 KW
Auke Bay Diesel 2,500 KW
Gas Turbine 24,800 KW
Gold Creek Hydroelectric 1,800 KW
Diesel 7,300 KW
Lemon Creek Diesel 22,500 KW
Gas Turbine 35,000 KW
Salmon Creek No. 1 Hydroelectric 5,000 KW
Alaska Power Administraton
Snettisham / Crater Lake Hydroelectric 78,210 kW
Alaska Power & Telephone Company
Dewey Lake / Skagway Hydroelectric 975 KW
Goat Lake / Skagway Hydroelectric 4,000 KW
Diesel / Skagway (proposed) 3,865 KW
Diesel
Black Bear / Craig Hydroelectric 4,500 KW
Diesel / Craig Diesel 3,820 KW
Haines Diesel 5,770 KW
Hydaburg Diesel 1,001 KW
Hollis Diesel 150 KW
Ketchikan Public Utilities
S. W. Bailey Diesel 13,450 KW
Beaver Falls Hydroelectric 7,300 KW
Ketchikan Lakes Hydroelectric 4,200 KW
Swan Lake / Revillagigedo Hydroelectric 22,500 KW
Island (State-Owned)
Totem Bight / Ketchikan Diesel 2,000 KW
5-4 Acres International Corporation
Existing Electrical Transmission and Generation Facilities
Acres International Corporation
Project Name / Location Fuel Type Installed
Capacity
Metlakatla Power & Light
Purple Lake Hydroelectric 3,900 KW
Centennial Diesel 3,300 KW
Chester Lake Hydroelectric 1,000 KW
Petersburg Municipal Power & Light
Blind Slough Hydroelectric 2,200 KW
Petersburg Generation Plant Diesel 7,650 KW
Tyee (State Owned) Hydroelectric 20,000 KW
City and Borough of Sitka
Blue Lake Hydroelectric 6,000 KW
Green Lake Hydroelectric 18,000 KW
Indian River Diesel 7,500 KW
Thorne Bay
Thorne Bay Plant Diesel 1,235 kW
Tlingit-Haida Regional Electric Authority
5 Small Plants (17 units) Diesel 6,067 kW
Wrangell Electric Department
Wrangell Municipal Plant Diesel 8,350 kW
5-5
6
Status of New Facilities
Development
Section 6
6.1
New Intertie Segments
Development
6x
Tyee-Swan Intertie
65122
Upper Lynn Canal
Intertie
6.1.3
Interties on Prince of
Wales Island
Status of New Facilities
Development
The planned 57-mile-long 138-Kv Tyee-Swan Intertie is a key element in the
proposed interconnected electric transmission SYSTEM. KPU's system is
connected electrically to the Swan Lake project. Wrangell and Petersburg are
connected to the Lake Tyee project. We include the proposed Tyee-Swan
Intertie in Phase I of the SYSTEM Plan. The line will intertie the electrical
systems of KPU, PMP&L, and WML&P, thereby increasing reliability and
operating efficiency for all three systems. Once the Tyee-Swan Intertie is in
place, a grid leg connecting Metlakatla will be feasible.
In 1994, KPU received a grant from the State of Alaska to hire consultants to
design the transmission line and prepare the EIS for the Forest Service,
August 1997 Swan Lake-Lake Tyee Intertie Final Environmental Impact
Statement Summary (Swan-Tyee EIS). The USDA Forest Service issued its
decision on the proposed Intertie in August 1997 Swan Lake-Lake Tyee
Intertie Record of Decision (Swan-Tyee ROD). Formal bids were solicited
during November - December 1997; and $76 million in State and Federal
funds has been obligated to construct the Tyee-Swan Intertie.
Alaska Power & Telephone Co. (AP&T) plans to construct a 14-mile 33 KV
submarine cable transmission interconnection between Skagway and Haines
Light & Power (HLP) to provide energy from the new Goat Lake
Hydroelectric Project to both locations during 1988. AP&T estimated cost for
the intertie is $5,400,000/1997$. Annual operating expense for the connection
is expected to be $15,000. AP&T also proposes to construct a 20 mile
overhead and underground line between Haines and Klukwan at an estimated
cost of $1,600,000/1996$. Annual O&M expense is expected to be
$10,000.(Upper Lynn Canal Regional Power Supply Review, April 1997).
These proposed intertie segments are included in Phase IV of the SYSTEM
Plan as existing infrastructure.
AP&T is developing transmission lines to deliver energy from AP&T's Black
Bear Lake Hydropower Plant to several communities on Prince of Wales
Island. (Correspondence from Bob Grimm, AP&T, to Randy Cornelius, Sitka,
June 20, 1997). These proposed intertie segments are included in Phase V of
the SYSTEM Plan as existing infrastructure.
Acres International Corporation 6-1
Status of New Facilities Development
6.2
Current Status of New
Generation Facility
Development
6.2.1
Goat Lake
6.2.2
Mahoney Lake
6.2.3
Ketchikan Small Hydro
Additions
6.2.4
Metlakatla Small Hydro
Upgrades/Additions
New hydropower generation currently being investigated by utilities in
Skagway, Ketchikan, and Metlakatla are designed to serve specific remote
load centers and is not included in the proposed SYSTEM Plan. We note that
a number of communities, including Ketchikan and Sitka, are also planning to
install additional diesel generation facilities to meet expected shortfall in the
near future. We identified the following active hydropower project proposals.
The Alaska Power & Telephone Co. has received a FERC license and other
necessary approvals for the 4.0 MW Goat Lake Project. The project is
currently under construction and the expected on-line date is 1998. AP&T is
constructing a submarine cable to connect Haines to Skagway which will
allow full utilization of the project output.
The Cape Fox Corporation (Cape Fox), permittee for the proposed Mahoney
Lake Hydroelectric Project, submitted a draft license application to the FERC
in May 1996. That application is currently under evaluation by the FERC.
The proposed 9.6 MW run-of-river Mahoney Lake Hydroelectric Project site
is located approximately 5 miles northeast of Ketchikan. KPU and Cape Fox
are currently discussing development options that might be beneficial to both
parties.
KPU is investigating the potential to install hydropower generation at three
existing dams located in close proximity to Ketchikan: Lake Whitman (2.7
MW), Carlanna Lake (0.5 MW), and Lake Connell (1.7 MW); and potential
upgrades to its Beaver Falls and Ketchikan Lakes hydropower projects. A
preliminary review of these potential future additions is discussed in the KPU
Power Supply Planning Study, December 20, 1996.
In March 1997, MP&L issued a report, Energy Generation Feasibility Study
Report, regarding the quantity of energy available from MP&L's system to
export to KPU on a monthly basis. MP&L is currently pursuing proposed
improvements at its existing hydropower projects, which are not jurisdictional
to the FERC. MP&L will add a 3 MW Pelton-type turbine and generator to
augment the existing 1.0 MW unit at its Chester Lake Project; construct a
tunnel between Edgecombe and Chester Lakes and new 2800-foot-long 24-
inch penstock; and related revisions. At Tamgas Lake MP&L will add a 550
KW Francis-type turbine and generator; modify the existing rock-fill dam to
raise lake elevation 10 feet; and will include related revisions. MP&L also
proposes to construct a new project at Triangle Lake (commence construction
June 2000; complete June 2002) including a new dam, penstock, powerhouse
with one 4 MW machine or two 2.0 MW machines, and a tie line.
6-2 Acres International Corporation
7
Action Plan
Section 7
7.1
Proposed Phasing of
Development
Action Plan
Communities in Southeast Alaska strongly support development of an
integrated electrical system. Copies of Resolutions adopted in participant
communities are included in Appendix A; copies of appendices are available
from the Southeast Conference. Participants' expectations expressed during
interviews include:
» identify appropriate sequencing for development - present basic assumptions
regarding timing;
» determine the optimum electric grid to interconnect major load centers in
Southeast Alaska, reduce need for redundant diesel generation, and enhance
reliability; and
» determine optimum locations for new hydro generation to provide for future
needs for the collective communities.
We present this proposed SYSTEM Plan in five phases based on assumptions
regarding projected load growth and engineering feasibility:
PhaseI 1995 - 2010
Construct interties connecting Swan Lake and Tyee Lake hydroelectric
projects to Ketchikan Public Utilities' (KPU's) electrical system; and construct
an intertie connecting Metlakatla Power & Light to KPU's electrical system.
Phase II 2011 - 2015
Construct interties connecting Sitka and Kake to Petersburg, Ketchikan and
Metlakatla.
Phase III 2016 - 2020
Construct interties connecting Angoon, Tenakee Springs, Hoonah, Green's
Creek and Juneau to Sitka, Kake, Petersburg, Ketchikan and Metlakatla
(North-South Grid). Construct Lake Dorothy and Swan Lake hydropower
projects.
Phase IV 2021 - 2025
Construct interties connecting Skagway, Haines, and Kensington to North-
South Grid. Construct Takatz Lake Hydropower Project.
Phase V 2026 - 2030
Construct intertie connecting Prince of Wales Island to North-South Gnd.
Construct Scenery Lake Hydropower Project.
Acres International Corporation 7-1
Action Plan
7.2
Regional Electrical
Interties
UPS
Proposed Intertie
Segments and
Estimated Cost
Figure 1, Southeast Alaska Utilities ELECTRICAL INTERTIE SYSTEM
PLAN, presents a map of Southeast Alaska with a schematic diagram
superimposed to depict load centers, existing and proposed new interties, and
existing and proposed new hydroelectric generation facilities. Figure 2,
Southeast Alaska Utilities ELECTRICAL INTERTIE SYSTEM PLAN:
LOADS AND RESOURCES presents a schematic diagram showing phasing
of new generation as loads grow and the transmission intertie SYSTEM is
constructed.
Existing transmission facilities in Southeast Alaska were constructed to
deliver power from generation to specific load centers. Due to remote islands
and rough terrain, electrical utilities in Southeast Alaska currently operate
their systems to deliver power to local customers and do not have opportunity
to import power from other systems to meet customer needs. The line
segments proposed in this SYSTEM Plan are designed to provide equal
opportunities for all participating systems to access hydropower generation,
thereby lowering power costs in communities currently dependent solely on
diesel generation and also providing enhanced reliability of service throughout
the region. The integrated electrical SYSTEM will also reduce the level of
backup power currently maintained in communities and enhance the
opportunity to develop cost-effective and environmentally preferred regional
hydropower generation facilities as opposed to proliferation of additional
diesel generation and development of numerous dispersed smaller hydropower
sites.
The primary source of information regarding proposed intertie segments was
the 1987 Southeast Alaska Transmission Intertie Study (1987 Intertie Study)
prepared by Harza for the Alaska Energy Authority. The 1987 Intertie Study
presented recommended configurations based on the fundamental objective of
sharing then surplus hydro generation at the Snettisham and Lake Tyee
projects with hydro-deficient supply centers, recognizing technical constraints
and practical limitations imposed by terrain and construction costs. Surplus
hydro generation at Lake Tyee is expected to be fully utilized as a result of
constructing the intertie with Ketchikan during Phase I. Snettisham is close to
full energy utilization. During critical water years, such as 1997, it was
necessary to run AELP diesels to cover hydro energy deficits. For average
water years there could be as much as 60 million KWH of surplus energy
during the summer and early fall months.
A brief discussion of each of the transmission intertie phases as shown on
Figure | follows. Table 7.1 presents estimated costs, based on existing
reports and escalated to 1996 dollars, for the proposed five phased
development. Sources of estimated costs are identified below.
7-2 Acres International Corporation
Action Plan
Table 7.1
Proposed Sequencing and In-Service Phase New Line Segments Load Centers
Cost Estimates for a
Southeast Alaska 2001 PHASE I: Swan Lake - Lake Tyee (KPU, Initial Draft Petersburg, Wrangell &
Transmission Grid Power Supply Planning Study, 1996) Ketchikan
Segments 57 mi 138-KV line connects Swan-Tyee hydros
Status: Final EIS/ USFS Record of Decision issued 8/97.
Construction bids to be requested in late 1997.
Estimated cost: $69,772,000/1996$
2002 PHASE I: Ketchikan - Metlakatla (Alaska Power Authority, Petersburg, Wrangell,
Southeast Alaska Transmission Intertie Study, 1987) Ketchikan & Metlakatla
15 mi 34.5 KV line (14 mi OH/ | mi submarine) Connect
KPU's Mountain Point Sub / Race Point, MP&L.
Status: Final documents to be prepared once Swan-Tyee line is
under construction.
Estimated cost: $8,785,000/1996$*
PHASE II: Petersburg - Kake - Sitka Sitka, Kake, Petersburg,
2002 II-A - Petersburg - Kake (DCRA, Division of Energy, Kake- Wrangell, Ketchikan &
Petersburg Intertie Feasibility Study, 1996) Metlakatla
46.7 mi 69 KV (44.3 mi OH / 2.4 mi submarine) capable of
upgrade to 138 KV.
Status: 1996 update to 1987 appraisal level engineering /
environmental review.
Estimated cost: $19,734,600/1996$
2008 II-B - Kake - Sitka (Alaska Power Authority, Southeast
Alaska Transmission Intertie Study, 1987)
55.4 mi 138 KV (20.2 mi OH /35.2 mi DC submarine) cable
Status: Reconnaissance engineering / environmental.
Estimated cost: $45,489,000/1996$*
2012 PHASE III: Sitka - Tenakee Springs/Angoon - Hoonah - Sitka, Angoon, Tenakee
Greens Creek - Juneau (Alaska Power Authority, Southeast Springs, Hoonah,
Alaska Transmission Intertie Study, 1987) Greens Creek, Juneau to
148.6 mi 138 KV (120.8 mi OH / 27.8 mi AC submarine) Petersburg, Wrangell,
Status: Appraisal level engineering / environmental review. Ketchikan, Metlakatla
Estimated cost: $173,788,000/$1996* (North-South Grid)
2020 PHASE IV: Juneau - Skagway (Alaska Power Authority, Connects Skagway,
Haines-Skagway Region Feasibility Study, 1981) Haines, and Kensington,
70.5 mi (6.5 miles 69 KV OH / 64 miles 100 KV DC north of Juneau, to
submarine) North-South Gnd
Status: Appraisal level engineering / environmental review.
Estimated cost: $79,160,000*
2025 PHASE V: Ketchikan - Prince of Wales Island (Alaska Connects Thome Bay,
Power Authority, Black Bear Feasibility Report, 1981) Kasaan, Klawock,
19 mi 69 KV or 115 KV (1 mi OH// 18 mi submarine) Hollis, Craig, and
Status: Appraisal level engineering / environmental review. Hydaburg to North-
Estimated Cost: $ 39,089,000* South Grid
System 243.8 mi OH / 148.4 mi submarine
Totals 392.2 total miles
Construction Cost Estimate
$435,817,000/1996
* Indicates cost prepared using standard cost curves to escalate earlier estimate.
7-3 Acres International Corporation
Action Plan
7.2.1.1
Phase |
7.2.1.2
Phase Il
The Swan-Tyee and KPU-Metlakatla transmission intertie components would
interconnect electric systems in Ketchikan, Wrangell, Petersburg, and
Metlakatla resulting in the first increment of the Southeast Alaska Electrical
Intertie SYSTEM (SYSTEM). This intertie segment is expected to utilize
current surplus generation available from Lake Tyee. As shown in Figure 2,
the existing generation resources of the respective utilities in an interconnected
grid will be adequate to supply the gross annual loads of the system through
the year 2010. Therefore, no additional hydroelectric resources are required
during this period.
» Lake Tyee-Swan Lake Transmission - 138 KV, 37 miles, to connect the two
State-owned hydropower projects. Estimated total cost includes
management, engineering, construction management, licensing and
permitting, right-of-way costs, a contingency and owners administration;
excludes maintenance costs (Project Estimate Update, Lake Tyee-Swan
Lake Intertie, Raytheon Infrastructure Services, Inc., July 25, 1996).
> Ketchikan-Metlakatla - 34.5 KV, 15 miles, three-phased (14 miles overhead
and | mile submarine) from KPU's Mountain Point Substation to Race
Point on Annette Island. Estimated cost includes management, engineering,
construction management, land acquisition, and owners administration;
excludes maintenance costs. (Alaska Power Authority, 10/1/87, Southeast
Alaska Transmission Intertie Study) A 1996 DCRA, Division of Energy,
study, Power Intertie Analysis, prepared by Jaight and McLaughlin
Consulting Engineers, Anchorage, confirmed the proposed route as
presented in 1987. No update to estimated cost was provided. (Rural
Alaska Electric Utility Interties, March 1997).
Preliminary cost estimates for development of intertie segments specified
during Phase I are $69,772,000/1996$ for the Swan Lake - Lake Tyee Project
and $8,785,000/1996$ for the Ketchikan Metlakatla intertie. Estimated costs
were presented in documents prepared by others and reviewed by the Acres
team during the course of this assignment and do not represent an independent
assessment.
Kake and Sitka would be connected to the SYSTEM. Again the existing
resources match reasonable well the overall loads of the interconnected
system, thereby requiring no further hydropower development through the year
2015.
> Petersburg-Kake - 69 KV, 46.7 miles (44.3 miles overhead and 2.4 miles
submarine cable), capable of future upgrade to 138 KV. Estimated cost
includes construction, engineering, construction management, right-of-way
acquisition, permitting, and owners administration. Proposal does not
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Action Plan
7.2.1.3
Phase III
include previously proposed underground sections. A number of studies
have been performed for this line segment. In 1996 DCRA, Division of
Energy, commissioned an update: Feasibility Study: Kake-Petersburg
Intertie, prepared by R. W. Beck, that incorporated and updated
information presented in earlier reports.
>» Kake-Sitka - 138 KV, 55.4 miles (35.2 miles DC submarine cable and 20.2
miles overhead wood pole design). Estimated cost includes management,
engineering, construction management, land acquisition, and owners
administration; excludes maintenance costs. Most of route follows existing
road at anadromous fish stream crossings. (Alaska Power Authority,
10/1/87, Southeast Alaska Transmission Intertie Study).
Preliminary cost estimates for development of intertie segments specified
during Phase II are $19,734,600/1996$ for the Petersburg - Kake Intertie and
$45,489,000/1996$ for the Kake - Sitka Intertie. Estimated costs were
presented in documents prepared by others and reviewed by the Acres team
during the course of this assignment and do not represent an independent
assessment.
Angoon, Tenakee Springs, Hoonah and Juneau would be connected to the
SYSTEM. At this point the load growth for Juneau becomes the major factor
in determining the needs of the interconnected system. If mining loads develop
during the next few years, Lake Dorothy may be brought on-line before 2015.
Further, based on the load growth as projected for Juneau, the system loads
can also fully utilize the proposed Swan Lake project within the 2015 - 2020
time frame.
> Sitka-Juneau - 138 KV, 148.6 miles (120.8 miles OH, 27.8 miles submarine
AC cable) $130,775,000/1987$ This preferred routing would need further
study as it was not proposed as part of the system in the APA 1987
Southeast Alaska Transmission Intertie Study. Total length of the West
Route alternative considered in the 1987 study was 204 miles, including the
Juneau-Green's Creek and Sitka-Kake segments. Alternative preferred in
1987 study was the Kake-Snettisham connection. (Alaska Power Authority,
10/87, Southeast Alaska Transmission Intertie Study) Descriptions of
segments of the preferred routing are discussed below:
>» Tenakee Springs-Sitka - 138 KV follows existing logging roads past Sitkoh
Lake to Point Lindenburg, crosses Peril Strait via submarine cable, exits at
Point Moses on Baranof Island to finally connect with Sitka's transmission
system. Routing envisioned would go to Warm Springs and Takatz Lake
Hydro crossing to Sitka along a proposed transmission/transportation
cornidor.
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Action Plan
» Tenakee Springs-Angoon - 138 KV (submarine AC cable) crossing Tenakee
Inlet to east of Kadashan Bay along existing logging roads to point NW of
head of Sitkoh Bay, remote substation to facilitate 69 KV spur to Angoon.
> Tenakee Springs-Hoonah - 138 KV 35-mile utility corridor is designated in
the Tongass Land Management Plan. The communities are almost
connected by logging roads now. (Rural Alaska Electric Utility Interties,
March 1997)
> Hoonah-Juneau - 69 KV, 50.4 miles (32.3 miles OH, 18.1 miles submarine
cable) to connect Hoonah to Snettisham Hydro Plant (includes connection
@ Greens Creek noted below). Estimated cost includes 20% for engineering
and overhead plus 25% for contingencies. Feasibility depends upon hookup
to Noranda mine. 3 substations, 2 separate segments of submarine cables
(6.1 mile and 12 mile) (U.S. Department of Energy, Alaska Power
Administration, 12/1/81, Juneau-Hoonah Transmission Line
Reconnaissance Evaluation)(Rural Alaska Electric Utility Interties, March
1997).
> Juneau - Green's Creek - 69 KV, 29.4 miles (24.2 OH, 5.2 submarine cable)
Douglas Island substation to Middle Point - cross Stephens Passage -
Youngs Bay near Hawk Inlet on Admiralty Island. USFS recommended
buried cable through portion of non-wilderness Admiralty Island National
Monument. (Alaska Power Authority, 10/87, Southeast Alaska
Transmission Intertie Study).
Preliminary cost estimates for development of intertie segments specified
during Phase III are $173,788,000/1996$ for the Tenakee
Springs/Angoon/Hoonah/Greens Creek/Juneau Intertie. Estimated costs were
presented in documents prepared by others and reviewed by the Acres team
during the course of this assignment and do not represent an independent
assessment.
7.2.1.4
Phase IV Skagway and Haines would be connected to the SYSTEM through a 70.5+
mile (64 miles 100 KV DC submarine cable, 6.5+ miles OH 69 KV) line
segment from Juneau to Skagway. Estimate based on 1982 Teshmont study
excludes escalation during construction but includes 25% contingencies and
15% engineering. (Rural Alaska Electric Utility Interties, March 1997) By
2020, either the Takatz Lake project or the Scenery Lake project could be
added to the system. Takatz Lake is shown on Figure 2 as a part of Phase IV
on the basis of the proposed road interconnection from Warm Springs and the
transmission system to Sitka as factors in reducing the environmental effects
and cost of development.
74 Acres International Corporation
Action Plan
ones
Phase V
7.2.2
Review of Existing
Reports
7.3
Regional Generation
Preliminary cost estimates for development of intertie segments specified
during Phase IV are $79,160,000/1996$ for the Juneau - Skagway Intertie.
Estimated costs were presented in documents prepared by others and reviewed
by the Acres team during the course of this assignment and do not represent an
independent assessment.
Communities on Prince of Wales Island would be connected to the SYSTEM.
With this addition in 2025, the cumulative load projections of the respective
communities indicate that the output of Scenery Lake would be fully utilized
in its first year of operation. Connection is assumed to be between Ketchikan
and Hollis - 69 or 115 KV, 19 miles (18 miles submarine cable and 1 mile
overhead line). (Alaska Power Authority, 10/1/81, Black Bear Lake Project:
Feasibility Report, Harza).
Preliminary cost estimates for development of intertie segments specified
during Phase V are $39,089,000/1996$ for the Ketchikan - Prince of Wales
Intertie. Estimated costs were presented in documents prepared by others and
reviewed by the Acres team during the course of this assignment and do not
represent an independent assessment.
The primary source of information used in preparing this Report was the 1987
Southeast Alaska Transmission Intertie Study prepared by Harza for the
Alaska Energy Authority (1987 Intertie Study). The 1987 Intertie Study
presented a comprehensive assessment of a large number of prospective
interconnection projects, including route selection and preliminary design of
many submarine cable links and overhead lines, and integrated these designs
into an overall system expansion plan. The 1987 Intertie Study constitutes an
important step towards an integrated system development plan, but the
investigations must be expanded and updated to ensure the continued validity
of several key conclusions.
Table 7.2 identifies sources of information relied on in preparing this Report
and as requested in the RFP identifies the level of investigation and project
development accomplished to date.
Hydro generation is a major element in the existing power supply of the
region. However, the water power potential of Southeast Alaska is still
largely an undeveloped resource. A report entitled “Water Powers of
Southeast Alaska” was prepared in 1947 by the Federal Power Commission
(currently known as the Federal Energy Regulatory Commission) and the U.S.
Forest Service (FPC/USFS Report) which identified 200 sites for potential
hydropower development. A following statement as contained in the Forward
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Action Plan
Table 7.2
Documents Reviewed -
Potential New Transmission
by the Chairman of the Commission is as true today as it was some 50 years
ago:
Date Report Level of
Development
October 1987 Alaska Power Authority Reconnaissance |
Southeast Alaska Transmission Intertie Study
August 1997 USDA Forest Service Final Route
Swan Lake - Lake Tyee Intertie Selection
Final Environmental Impact Assessment
Final Record of Decision
April 1996 Alaska Department of Community and Regional Affairs Draft
Kake-Petersburg Intertie Feasibility Study Reconnaissance
April 1997 Alaska Power & Telephone Co. Draft
Upper Lynn Canal Regional Power Supply Review Reconnaissance
March 1997 Alaska Department of Community and Regional Affairs Preliminary Draft
Rural Alaska Electric Utility Interties Survey
“\.. There are over 200 potential projects which it is estimated could develop
1,008, 370 average horsepower. Of these, 27 range in size from 10,000 to
51,000 average horsepower each, or a total potential of 534,000 average
horsepower. In developing a power system many of these projects would
logically be interconnected with high voltage transmission. The remaining
projects and some of less capacity, but susceptible to automatic control and
operation, could be interconnected through the principal stations at lower
voltage transmission...”
Over the intervening years, slow but steady progress has been made in this
direction. The current SYSTEM Development Action Plan, then, simply
represents a continuation of this process. In more recent times, many of the
projects identified in the FPC/USFS Report have either been developed as
listed above or have been studied in further detail as summarized in Section
7.3.5 that follows. Of these, project that have been identified as having the
highest potential for inclusion into the SYSTEM Development Action Plan
include:
>» 10 MW proposed 3rd unit at the existing Lake Tyee Project
» 26 MW proposed Lake Dorothy Project, Taku Inlet
>» 48.5 MW proposed Swan Lake Project, Thomas Bay
>» 20 MW proposed Takatz Lake Project, Baranof Island
> 45 MW proposed Scenery Lake Project, Thomas Bay
7-8 Acres International Corporation
Action Plan
Table 7.3
Potential New SYSTEM
Hydroelectric Projects
feo
Potential New
Hydropower Projects
Wesel
Third Unit at Tyee Lake
7.3.1.2
Lake Dorothy
A general description of each of the above listed projects and a discussion of
the respective studies performed to-date follows. Table 7.3 presents potential
average annual generation.
Plant Installed Capacity Average Annual
(MW) Generation (MWh)
Tyee Lake (3rd unit) 10.0 1,000
Lake Dorothy 26.0 127,000
Swan Lake 48.5 170,000
Takatz Lake 12.0 86,000
Scenery Lake 45.0 150,000
Total 141.5 534,000
A third unit bay was installed during original construction of the Tyee Lake
project in anticipation of future growth in the region. A 10 MW turbine-
generator would provide an additional 1,000 Mwh of peaking energy annually;
an additional benefit of the third unit is to recover 1,050 Mwh of energy
during maintenance on either of the two existing 10 MW units.
The third unit would support future growth in Wrangell and Petersburg, the
two communities that have priority rights to power generated at Lake Tyee.
With construction of additional interties, energy could be available to
Ketchikan, Metlakatla, and Kake.
Lake Dorothy is located east of Juneau above Taku Inlet at elevation 2422.
Hydroelectric power could potentially be developed at the site by the
construction of a lake tap to supply water to an 11 foot diameter, 2% mile
long tunnel leading to a powerhouse at tidewater containing two 13 MW units.
A 4% mile long submarine cable would be interconnected with the existing
138 KV Snettishham transmission line to provide 26 MW of capacity and
127,000 Mwh of firm and average annual energy to the Juneau area.
The Alaska Electric Light & Power Company (AELP) currently holds a
Preliminary Permit from the FERC for study of the site. The Permit was
applied for in anticipation of the re-opening of the A. J. Mine in Juneau. Since
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Action Plan
33
Thomas Bay - Swan
Lake
the time of the permit application, however, Echo Bay Alaska has dropped
plans for proceeding with AJ Mine development. A recent inspection of the
Snettisham underwater cable crossing Taku Inlet indicates a redundant set of
cables will have to be installed to insure the reliability of Juneau's Snettisham
energy supply. The new cables will be sized to have the capacity to carry both
Snettisham and Lake Dorothy generation and will substantially reduce Lake
Dorothy's construction costs. AELP is also investigating other scenarios for
reducing the scope and cost of Lake Dorothy so that it could be sized to serve
the proposed Kensington Mine. The Kensington Mine is close to being fully
permitted. These additional considerations may require AELP to apply for a
subsequent Permit.
Swan Lake is located approximately 15 miles northeast of Petersburg above
Thomas Bay at elevation 1520. Hydroelectric power could potentially be
developed at the site by the construction of a lake tap to supply water to a 7
foot diameter, 2/2 mile long tunnel leading to a powerhouse at tidewater
containing two 24.25 MW units. A combination of overhead transmission and
submarine cable would interconnect the project with the grid at Petersburg to
provide 46.5 MW of capacity and 170,000 Mwh of firm and average annual
energy to the region.
The Swan Lake site was initially proposed in an application for a license to
the Federal Power Commission in 1922. The license was issued but later
terminated. Subsequently, the US Bureau of Reclamation completed an
Interim Report on the potential of the Thomas Bay area dated, June 1965.
The hydroelectric project was under consideration to meet the urgent power
needs at that time in Petersburg, Wrangell, Kake, Ketchikan and Metlakatla.
A geology report on the project had been developed earlier in January 1962.
Petersburg retained R. W. Beck and Associates to analyze electrical power
requirements for the City which culminated in a report, “Analysis of Electrical
System Requirements”, dated March 1974, presenting the site as a potential
power resource. Beck also prepared an Appraisal Report for the Thomas Bay
Power Commission for review as a resource for the communities of
Petersburg and Wrangell. However, the project was later dropped from
consideration in favor of the Lake Tyee Project which was subsequently
constructed.
Currently, the project’s capability far exceeds the needs of the Petersburg /
Wrangell area for the foreseeable future and would accordingly be available
as a regional resource.
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Action Plan
7.3.1.4
Takatz Lake
7.3.1.5
Thomas Bay - Scenery
Lake
Takatz Lake is located approximately 15 miles directly east of Sitka above
Takatz Bay at elevation 920. Hydroelectric power could potentially be
developed at the site by the construction of a lake tap to supply water to a 8
foot diameter, 1% mile long tunnel leading to a powerhouse at tidewater
containing two units. Studies conducted have proposed installations ranging
from 12 MW to 20 MW.
Previous studies have consistently identified Takatz Lake as the next hydro
project for development by the City and Borough of Sitka. In fact, the US
Department of the Interior, Alaska Power Administration/Bureau of
Reclamation made a fairly detailed evaluation of the Takatz Lake site in the
1960s, and it was considered a serious alternative to the existing Green Lake
Project. Green Lake was ultimately developed due to the relative cost of
transmission for the two sites.
Previous evaluations of the Takatz Lake site have a included an overhead
transmission line for the 25 mile distance between the powerhouse site and the
existing Sitka distribution system. The resulting routing involved traversing
some extremely rugged terrain, including two mountain passes — one between
the Takatz Lake drainage and the Baranof Lake drainage at about elevation
2100, and one between the upper Baranof drainage and the upper Sawmill
Creek drainage at about elevation 2900. The resulting construction cost of
this transmission connection is the primary reason why this site remains
undeveloped.
Serious consideration is now being given to the construction of a road between
the Baronof / Warm Springs area and Sitka as a means to improve ferry
service along the Alaska Marine Highway as well as tourism from cruise
ships. The proposed road would include a | mile long tunnel through the most
tugged part of the terrain as referenced above. Clearly, the incremental cost
of a transmission line constructed along the right-of-way of the proposed road
would be significantly less than previously considered thereby greatly
increasing the economic viability of Takatz Lake site for hydropower
development.
Currently, the project’s capability exceeds the needs of the Sitka area and
would accordingly be available as a regional resource. The City anticipates,
however, that at some point in time all of the output of the project will be
needed within their system.
Scenery Lake is located approximately 7 miles north of the Swan Lake site as
discussed above or 22 miles northeast of Petersburg. It is situated above
Thomas Bay at elevation 1,080. Hydroelectric power could potentially be
developed at the site by the construction of a lake tap to supply water to a 7
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Action Plan
7.3.1.6
Lake Grace Diversion to
Swan Lake Hydroelectric
Project
7.3.2
Proposed Phasing of
New Hydroelectric
Projects
foot diameter, 3/2 mile long tunnel leading to a powerhouse at tidewater
containing two 22.5 MW units. An overhead transmission line would
interconnect the project with the grid at the Swan Lake site to provide 45 MW
of capacity and 150,000 MWH of firm and average annual energy to the
region. Unlike the other above listed projects, the Scenery Lake site has not
been studied in any detail. The only identifiable reason for this lack of interest
is that to-date no need for the project has occurred in the surrounding area
beyond the potential provided by the Swan Lake site. A description of the
features and the potential of the site was included in the FPC/USFS Report
which has served as the basis of the data included herein.
Lake Grace is located 28 miles from Ketchikan on the east side of
Revillagigedo Island. A Power Project Withdrawal application was filed with
the Federal Power Commission on November 21, 1926 but was vacated by the
FERC on October 31, 1985. KPU is currently reviewing the long-term
feasibility of diverting water from Lake Grace through a tunnel to Swan Lake.
Water would be used to increase water storage capacity, thereby increasing
generation at Swan Lake. KPU is considering installing a new turbine at
Swan Lake.
A major regulatory barrier to developing Lake Grace is its location within the
Misty Fjords National Monument in a designated Wilderness Area.
Development of Lake Grace would require approval by the President of the
United States with concurrence of the U. S. Congress. Language in Section
1105.2 of ANILCA further limits development by requiring that such
authorization may be obtained only if"... there is no economically feasible and
prudent alternative..."
Normally, the phasing of hydroelectric projects within a power system grid is
based largely on the estimated cost of each respective potential project. By
nature, hydroelectric projects are capital cost intensive and are generally very
site specific. In the present case, no consistent set of cost estimates are
available as a means of comparison for the above identified projects. What is
known, however, is the above listed projects have very similar characteristics
consisting of lake taps at perched lakes with tunnels of reasonable length
leading to powerhouses at tidewater. Therefore, development costs can be
expected to be comparable and consistent with others recently developed in the
region.
Accordingly, it is appropriate to phase project development on the basis of
projected needs for the intertie itself coupled with due consideration to the load
growth in the region as a whole. Thus, the intertie is the key factor in the
phasing of hydro generation projects. A regional intertie will enable full
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Action Plan
7.3.2.1
Phase |
7.3.2.2
Phase II
7.3.2.3
Phase III
7.3.2.4
Phase IV
7.3.2.5
Phase V
utilization of each project as it would come on-line without the particular
needs of the respective nearby communities. Shown on Figure 2 is a potential
phasing of the five candidate projects listed above based on meeting the
regional loads in step with the development of each component of a regional
transmission grid. A brief discussion of each of the transmission intertie
phases describing correlation to future hydropower project development
follows.
The proposed Phase I transmission intertie component would interconnect
Metlakatla with Ketchikan, Wrangell and Petersburg. As shown on Figure 2,
the existing resources of the respective utilities in an interconnected grid will
be adequate to supply the gross annual loads of the system through the year
2010. Therefore, no additional hydroelectric resources are required during
this period.
The proposed Phase II would add Sitka and Kake to the transmission system.
Again the existing resources match reasonable well the overall loads of the
interconnected system, thereby requiring no further hydropower development
through the year 2015.
The proposed Phase III would add Angoon, Tenakee Springs, Hoonah and
Juneau to the transmission system. At this point the load growth for Juneau
becomes the major factor in determining the needs of the interconnected
system. It indeed is possible that Lake Dorothy may have been brought on-
line before 2015. Further, based on the load growth as projected for Juneau,
the system loads can also fully utilize the Swan Lake project within the 2015 -
2020 time frame.
The proposed Phase IV would add Skagway and Haines to the transmission
system. By 2020, either the Takatz Lake project or the Scenery Lake project
could be added to the system. Takatz Lake has been shown on Figure 3.1 as a
part of Phase IV on the basis of the proposed road interconnection from Warm
Springs and the transmission system to Sitka as factors in reducing the
environmental effects and cost of development.
The proposed Phase V would add the communities on Prince of Wales Island
to the transmission system. With this addition in 2025, the cumulative load
projections of the respective communities indicate that the output of Scenery
Lake would be fully utilized in its first year of operation.
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or
Review of Existing
Reports - Hydropower
Projects
Table 7.4
Documents Reviewed -
Potential New Hydroelectric
Projects
Reports relied on in preparing this section are identified in the above narrative
sections. Table 7.4 identifies the level of development of each of the relevant
reports.
Date Report Level of
Development
10/1987 | Alaska Power Authority Reconnaissance
Southeast Alaska Transmission Intertie Study _
8/1997 USDA Forest Service Identifies constraints on
Land and Resource Management Plan, Tongass National new development, lists
Forest projects consistent with
Tongass Land Management Plan Revision plan
Final Environmental Impact Assessment
12/1996 | Ketchikan Public Utilities Identifies potential
KPU Power Planning Study projects; Feasibility study
underway.
3/1997 Metlakatla Power & Light Describes proposed
Energy Generation Feasibility Study Report upgrades and potential
new project. No details
I | provides.
1947 Federal Power Commission and Forest Service - U.S.D.A. Identifies 200 sites for
Water Powers - Southeast Alaska potential hydropower
development
1992 Ketchikan Public Utilities Update to existing
Lake Tyee to Swan Lake Transmission Intertie Feasibility reports and review of
Study feasibility
4/1974 Electric Utility System - City and Borough of Sitka Project feasibility
Analysis of Electric System Requirements investigation
3/1974 Petersburg Municipal Power & Light | Appraisal
Analysis of Electrical System Requirements | T
11/1975 | Thomas Bay Power Commission, Petersburg - Wrangell Appraisal
Appraisal Report
1960 U. S. Department of the Interior Detailed evaluation
Alaska Power Administration/Bureau of Reclamation
Takatz Creek Project - Alaska
10/1985 | Alaska Electric Light and Power Company Operating Projects and
Application for New License - Annex Creek and Salmon Creek | discussion of Altematives
10/1991 | City and Borough of Sitka, Alaska Feasibility analysis
Electric Resource Evaluation and Strategic Plan
8/1990 Alaska Electric Light and Power Company Reconnaissance review
Juneau 20-Year Power Supply Plan Update _ |
6/1991 Alaska Power & Telephone Company Project feasibility and Application for License - Black Bear Lake Project design
7-14 Acres International Corporation
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7.4
Economic and Financial
Issues
7.4.1
Economic Parameters
Table 7.5
Annual Fixed Carrying
Charges - Alaska Power
Authority Guidelines
Employed in 1987
Southeast Alaska
Transmission Intertie Study
Economic parameters and assumptions used in evaluating
alternatives presented in the 1987 Study were based on guidelines
supplied by the Alaska Power Authority and local utilities. These
criteria are generally accepted in performing economic analysis and
should be updated and applied in future analyses regarding the
proposed Southeast Alaska Electrical Intertie SYSTEM. Annual
fixed carrying charges employed in the 1987 Intertie Study are listed
on Table 7.5.
20-Year 30-Year 50-Year
Life Life Life
Cost of Money (%) 3.50 3.50 3.50
Amortization (%) 3.54 1.94 0.76
Insurance (%) 0.25 0.20 0.20
Total (%) 7.29 5.64 4.46
Criteria include the following:
» Costs are expressed in dollars
» Present Worth Analysis covers a 30-year economic life /
transmission
>» Planning Horizon/Period of Study is 20 years
>» Discount Rates used are as appropriate for participants
> Inflation Rate is the current rate
» Economic Life of Projects
- Diesel Generators - 20 years
- Transmission Lines - 30 years
- Hydroelectric Plant - 50 years
The Economic Analysis presented in the 1987 Study was performed
in two steps. The first step, an economic screening, compared the
construction cost of each intertie link to the value of the potential
displaced diesel fuel. The screening was performed by comparing
Acres International Corporation 7-15
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the net present worth life cycle costs of the intended transmission link
with that of the existing diesel system. The sunk cost of existing
hydroelectric developments and transmission and distribution
systems were assumed to be the same for all economic cases
considered and were excluded from further analysis. Analyses were
conducted using Alaska Power Authority criteria for discount rates,
energy demand, and fuel costs. The planning horizon for the study
spanned 20 years.
An important goal of the 1987 Study was to determine the most
practical way to utilize surplus energy available from the
Snettisham/Crater Lake and Swan Lake-Lake Tyee hydroelectric
projects. Transmission interties between Juneau and Sitka and Lake
Tyee and Swan Lake were preferred new transmission segments.
Completion of those segments was predicted to use nearly all (96%)
of the surplus generation from the two hydro projects by 2006. The
Swan Lake-Lake Tyee Intertie is proposed to be developed in Phase
I; the intertie between Sitka and Juneau is proposed in Phase III.
Power over the intertie will supply near-term Ketchikan, Petersburg,
and Wrangell needs; any remaining surplus would be provided to
Metlakatla and Kake. Based on predicted load growth in the Juneau
area, surplus power cited in the 1987 report at Snettisham/Crater
Lake would be fully utilized during Phase II.
7.4.2
Electric Load The scope and budget for this assignment did not include a rigorous
Characteristics and update to load forecasts to accurately model the load distribution for
Forecasts evaluation of proposed transmission grid legs. All information
regarding utility loads and resources is compiled from existing
sources of information and included in this SYSTEM Plan as
background information supporting the phased development of the
SYSTEM. Discussions of predicted future load growth for
municipalities and utilities in Southeast Alaska are based on existing
documents and interviews with municipalities and utilities. Table
7.6 presents predicted loads.
Reports reviewed in preparing information in this section are
identified below.
Electric Load Forecast for Ketchikan, Metlakatla, Petersburg,
and Wrangell, Alaska: 1990 - 2010 - ISER 1990 Forecast
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Table 7.6
Load Growth Projections for
Participating Communities UTILITY / LOCATION / PHASE 1990 2000 2010 2020
oy Annual Growth KPU / Ketchikan / PHASE I(1) 2.0 2.0 2.0 2.0
PMP@L / Petersburg / PHASE I (1) 1.3 13 16 1.6
WMP&L / Wrangell / PHASE I (1) 1.3 13 16 1.6
MP&L / Metlakatla / PHASE I(1) 17 17 15 Ls
THREA / Kake / PHASE Il (2) 12 12 12 12
SED / Sitka / PHASE (3) _ 1.0 1.0 Lo Lo
AELP / Juneau / PHASE Ill (4) 2.5 25 25 2.5
THREA / Angoon / PHASE III (2) _ 12 12 12 12
THREA / Hoonah / PHASE III (2) 12 12 12 12
AP&T / Skagway / PHASE IV (5) 14 14 14 14
AP&T-HLP / Haines / PHASE IV (5) 2.0 20 20 2.0
THREA / Chilkat Valley / PHASE IV (2) 12 1.2 12 12
COCO / Coffinan Cove / PHASE V (7) 12 12 12 12
AP&T / Craig / PHASE V (6) 2.5 25 2.5 2.5
AP&T / Hollis / PHASE V (6) 2.5 25 2.5 25
AP&T / Hydaburg / PHASE V (6). 2.5 2.5 2.5 2.5
THREA / Klawock / PHASE V (2) 12 12 12 12
THREA / Kasaan / PHASE V (2) 12 12 12 12
TB / Thome Bay / PHASE V (7) 12 1.2 12 12
(1) Electric Load Forecast for Ketchikan, Metlakatla, Petersburg and Wrangell, AEAJISER, 1990 (2) 1997 - 1999 Three-Year Construction Work Plan, THREA, 1996 (3) 1996 Electric System Load Forecast, SED, 1996
(4) Juneau 20-Year Power Supply Plan, AELP, 1990
(5) Upper Lynn Canal Regional Power Supply Review, AP&T, 1997
(6) Environmental Assessment, Black Bear Hydroelectric Project, FERC, 1992
(7) Alaska Electric Power Statistics - 1960-1995, DCRA/DE & ASCC, 1996
7-47 Acres International Corporation
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7.4.2.1
Alaska Electric Light and
Power Company
This report was prepared for the Alaska Energy Authority by the
Institute of Social and Economic Research, University of Alaska
Anchorage, dated June 25, 1990 (ISER 1990 Forecast). Utility
electric energy requirements in these communities were projected to
grow at an average annual rate of between - 3 and +4 percent per
year between 1990 and 2010 from the 1988 level. Growth rates
considered economic effects of the Quartz Hill mine and the
Bradfield intertie, but did not include mine loads themselves. The
Quartz Hill mine development did not begin operation in 1995 as
predicted in the high and medium scenarios, therefore for purposes of
this presentation the low growth scenario has been used.
Southeast Alaska Transmission Intertie Study - 1987 Study
The 1987 Southeast Alaska Transmission Intertie Study (1987
Study) presented three load forecasts, high, medium, and low. Load
growth during the past 10 years has deviated from the predictions.
Planning criteria used to guide the 1987 Study projected the most
economic development would include new transmission links
between (1) Snettisham and Sitka via Juneau, Green's Creek Mine,
Hoonah and Tenakee Springs; (2) Petersburg, Wrangell and
Ketchikan via a Tyee Lake-Swan Lake intertie; and (3) the Quartz
Hill Mine and B.C. Hydro at Kitsault, British Columbia. Total
estimated construction cost of these three interconnections was
projected to be $153 million at the January 1987 price level.
AELP a private utility, serves the City and Borough of Juneau
(CBJ). The most recent information regarding AELP's system and
projected future scenarios is presented in the 1/990 Juneau 20-Year
Power Supply Plan Update (1990 Juneau Plan). Existing resources
in 1990 totalled 152 MW. Primary sources of power are small
hydroelectric projects owned and operated by AELP and the federal
Snettisham/Crater Lake hydroelectric projects. Legislation was
enacted to transfer Snettisham/Crater Lake to the State of Alaska;
transfer proceedings are continuing as of October 1997. AELP
operates and maintains Snettisham/Crater Lake. Snettisham is close
to full energy utilization. During critical water years, such as 1997,
it was necessary to run AELP diesels to cover hydro energy deficits.
For average water years there could be as much as 60 million KWH
of surplus energy during the summer and early fall months.
The Kensington Mine's annual energy requirement is 68,400,000
KWH (pg. 2-26 Environmental Impact Statement dated August
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7.4.2.2
Alaska Power &
Telephone Co.
7.4.2.3
City of Kake
7.4.2.4
City of Ketchikan -
Ketchikan Public Utilities
(KPU)
1997). The annual energy requirement for the Jualin Mine is
unknown.
The 1990 Juneau Plan identified demand side management (DSM) as
having the greatest potential to reduce need for new capital
investment in generation. Results of implementing DSM measures to
date have been mixed. Projections in the 1990 Juneau Plan,
including a projected 2.0% load growth rate over the period 1998 -
2018 were employed in preparing this SYSTEM Plan. However, if
the state oil revenues continue to decline and potential mining
activity does not materialize, AELP may not need future sources of
generation.
Alaska Power & Telephone Co. (AP&T) currently provides energy
to the following communities of Craig, Klawock, Hollis, Hydaburg,
Coffman Cove, and Whale Pass, on Prince of Wales Island; and the
communities of Haines and Skagway in the Upper Lynn Canal
Region. AP&T recently acquired Haines Light & Power (HLP).
AP&T has developed future plans to serve Thorne Bay and Naukati
on Prince of Wales Island and Klukwan and Chilkat Valley in the
Upper Lynn Canal Region. Detailed information on AP&T's system
was not made available to Acres.
The City of Kake is located on the northwestern tip of Kupreanof
Island in Southeast Alaska. Electric service is currently provided to
the 700 residents by the Tlingit-Haida Regional Electrical Authority
(THREA) using 2,230 KW of installed diesel generation. THREA's
electrical system is isolated from other communities and alternative
sources of supply. Peak demand in 1994 was 1,020 KW and total
energy generation was 4,248 MWH. Ratepayers in Kake pay the
highest rate for electric service identified in this study. The proposed
SYSTEM interconnections would significantly reduce power costs
and would be expected to enhance potential for future economic
development and related load growth.
Ketchikan, located on Revilligegado Island, is Alaska's fourth largest
city. Electric power is generated by hydroelectric plants at Swan
Lake, Ketchikan Lakes and Lake Silvis/Beaver Falls with occasional
back-up provided by the Bailey diesel plant. Ketchikan has
experienced significant growth in electrical demand over the past
decade. Residential use per KPU customer increased at an average
annual rate of .4% between 1969 and 1987. Commercial use
increased at a higher rate.
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7.4.2.5
Metiakatla Power & Light
7.4.2.6
City of Petersburg -
Petersburg Municipal
Power & Light (PMP&L)
In recent years KPU has not been able to meet demand with
hydroelectricity and has been forced to rely on the more expensive
and less dependable power provided by aging diesel plant and
surplus power from the Ketchikan Pulp Company (KPC). In
October 1996, KPC announced that it would close its pulp mill and
related electric generating facility in March 1997. (Initial Draft
Power Supply Planning Study - Foreword) Loss of the pulp mill will
affect 465 employees and eliminate a power source; if KPC
continues to operate its sawmill about 150 jobs would be retained
and a new electric load would occur.
Metlakatla is located on Annette Island approximately 15 miles
southwest of Ketchikan within the Annette Islands Indian
Reservation. Metlakatla's economy is fairly stable and is primarily
supported by timber and fishing industries. Royalty payments for
timber harvest through 1987 were $5 million; an additional $3
million is projected if the entire resource is harvested. Fisheries
activities provide approximately 93 jobs. A community-owned
sawmill operated by KPC under a long term lease provides 110 full-
time, year-round jobs, and an additional 30 jobs are associated with
longshoreing activities. KPC has recently opened a second sawmill
at Ward Cove near Ketchikan. The KPC-Annette Island sawmill
lease ends in 2004. The sawmill consumes about 6,000 MWH/year
(1989 data), or about 40% of Metlakatla's total sales. MP&L's
hydroelectric plant cannot respond quickly enough to the second-by-
second fluctuation and resulting load variation. MP&L is forced to
run a 3,500 KW diesel generator loaded to 1,000 KW in order to
respond to the sawmill load and maintain system reliability.
Residential electricity use averages 17,250 KWH due to use of
electricity for space and water heating and poorly insulated homes.
Petersburg Municipal Power & Light (PMP&L) serves
approximately 1,860 consumers within the city limits and Mitkof
Island. POWER Engineers, Inc. prepared a draft 20-Year Plan to
define additions and modifications for PMP&L's system in April
1997. PMP&L has three sources of generation: Tyee Hydro Project,
Crystal Lake Hydro Project, and downtown Diesel Plant. Crystal is
base loaded with the remaining generation provided by Tyee; backup
power is provided by the Downtown Diesel Plant.
Petersburg has historically relied on the ocean fishery and logging for
its economic activity. Petersburg's system peaks in summer from
fish plants' demands, but are starting to level out between winter and
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7.4.2.7
City and Borough of
Sitka - Sitka Electric
Department
7.4.2.8
Tlingit-Haida Regional
Electric Authority
summer. PMP&L energy requirements in 1995 were 37,400 MWH
and peak demand was 9.2 MW. Current peak load for the PMP&L
system is approximately 8.7 MW and available backup capability is
7.2 MW. Total PMP&L load growth has averaged 4.7% per year
between 1984 and 1995. Petersburg states that it is preparing a new
load forecast. Load curtailment occurs during peak demand hours if
the Tyee source is lost. Tyee power is delivered to Petersburg at the
69-25 KV Petersburg Substation owned by the State of Alaska and
operated by Thomas Bay Authority. PMP&L's 20 Year Plan
evaluates five diesel scenarios for added generation on Mitkof Island.
The Sitka Electric Department (SED) serves consumers on Baranof
Island and Japonski Island. Past and projected future rate of
population growth is 0.5% and employment growth is 0.55%. Major
industries include: fish processing currently growing at an annual
rate of 1.3 %; and tourism projected to increase at 5.0 % through
2001 and 2.5 % thereafter. The APC pulp mill, once a major source
of employment, is no longer in operation. Plant closure and site
redevelopment are expected to occur. The former APC site is
attractive for commercial or industrial development as it enjoys
direct access to open water and municipal utility infrastructure is in
place.
In the medium ISER forecast, power requirements in Sitka are
assumed to remain at the current level through 2000 and increase at
0.55 per year through 2010. Future energy system losses are
assumed to equal 7%. System peak demand levels are based on
assumed future system annual load factor of 56.6%. System peak
demand is projected to increase to 23.8 MW in 2010. Electric rates
are projected at the current level through 2000 and to increase at a
3.0% rate of inflation through 2010. The percentage of all-electric
homes is projected to increase at a 40% rate in the medium scenario.
Thompson Harbor facility is projected to double in size and fill up by
2003. Sitka is currently proposing to add a new diesel generation
station this year.
The THREA is a generation and distribution electric utility
incorporated in 1977 to provide electric generation and distribution
service to five Tlingit and Haida villages located in Southeast
Alaska: Angoon, Hoonah, Kake, Kasaan, and Klawock, located on
islands in the Alexander Archipelago. Chilkat Valley, THREA's
sixth village, was added in 1994. A seventh village, Klukwan, part
of the original study in 1976, has elected to join THREA.
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7.4.2.9
Wrangell Municipal Light
& Power
7.6
Environmental and
Regulatory Procedures
Load growth is attributed to one-time events such as new housing
and adding new communities to the system. Predicting new load
growth has always been difficult. THREA serves no large power
(1,000 KW or larger) loads. Village economies are primarily
dependent on timber, fishing, government and service industries.
Villages receive assistance through the Power Cost Equalization
(PCE) program and are concerned that the State of Alaska address
the potential demise of PCE in 1999. The timber industry has been
most responsible for economic growth in the communities over the
past ten years. Village and regional corporations will soon exhaust
their private timber reserves and there is grave concern among
community leaders that this will result in a loss of jobs. The fishing
industry is cyclical with prices fluctuating considerable during the
fishing season. It is difficult to justify the economics of a fish
processing plant in rural village communities where energy costs are
higher that other locations in Southeast Alaska.
Construction of the planned 8-mile intertie from Chilkat to Haines
will allow THREA to access lower cost power from AP&T's Goat
Lake Project for the Chilkat Valley and Klukwan. Southern Energy,
an independent power producer, has started construction of a 500
KW run-of-river hydro plant with the goal of serving property owned
by Southern Energy and selling excess power to THREA and HLP.
Wrangell Municipal Light & Power (WML&P) is dependent on
fishing and tourism for much of its economic base. Wrangell also
benefits from a sawmill and is enjoying a new life as a staging area
for mining activity just across the Canadian border, largely as a
demand for airport and logistical services. Wrangell's recent loads
were not significantly different than forecasted in the 1990 ISER
Base Case.
The environmental and regulatory review and related issuance of
approvals in the form of licenses and permits often requires a long
lead time in order to commence with construction and complete
facilities on a timely and cost-effective basis. Issuance of a federal
license or permit triggers environmental review requirements under a
number of statutes, including the National Environmental Policy Act.
Facilities envisioned in this SYSTEM Plan involve actions that will
require federal licenses and permits including:
> permits to cross navigable waterways and wetlands, or to allow
dredge and fill activities;
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on
Reconnaissance Level
Review - "Fatal Flaw
Analysis"
7.5.2
Formal Licensing and
Permitting Requirements
» preparation of a Special Use Authorization to occupy Tongass
National Forest lands; and
» Hydropower projects and primary transmission lines jurisdictional
under the Federal Power Act are required to be licensed by the
Federal Energy Regulatory Commission (FERC).
Based on prior experience, time periods to complete regulatory
approvals involving NEPA review are:
>» Hydropower licenses for major unconstructed projects: 5 - 12
years; and
» Approvals for transmission line segments located on federal lands:
2-5 years.
A "fatal flaw" environmental assessment for each of the selected line
segment is typically performed concurrently with engineering
feasibility investigations to determine whether an environmental issue
of significant magnitude would preclude construction and operation
of a line segment, even though reasonable mitigation measures could
be implemented. Tasks involved in this assessment include:
>» Reconnaissance review of the proposed project area to identify any
critical habitat for aquatic and terrestrial species; fish and wildlife
populations; navigable waterways; wetlands; listed cultural,
archaeological, or historic properties; recreational use areas; and
scenic vistas.
> Literature search to identify any resources and areas that will
require significant enhancement or mitigation measures.
> Review of licensing, permitting and other approvals that will be
required to design, construct, and operate facilities.
> Preliminary consultations with federal and state resource
management agencies with authority over use and occupancy of
lands, waters, and resources in the proposed project area.
Once project feasibility is confirmed, the formal permitting and
licensing procedures are accomplished. These include:
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> formal consultations with state, federal, and local agencies and
other governmental authorities; non-governmental organizations;
and other interested parties;
> environmental data gathering and studies;
> applications for approval by regulatory authorities; and
> environmental protection and enhancement plans.
The Swan Lake - Lake Tyee Intertie development process provides
insight into the potential environmental investigations that will be
required to receive permits and other regulatory approvals in order to
construct additional segments of an interconnected SYSTEM. The
environmental and regulatory review follow in tandem with route
selection and engineering feasibility and design. The recent FERC
licensing of the proposed Goat Lake Project provides insight into
environmental, engineering, and economic/financial investigations
associated with applying for and receiving a FERC license.
Typical licensing and permitting requirements for transmission lines
(T) and hydropower facilities (H) are listed in the Table 7.7.
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Table 7.7
Typical Licensing and
Permitting Requirements for
Transmission Lines and
Hydropower Projects
7.5.3
Environmental
Protection,
Enhancement, and
Mitigation Requirements
Column "T" identifies transmission requirements; Column "H"
identifies hydropower facilities requirements.
H PERMITS AND APPROVALS
xX Corps of Engineers Individual Section 10 Permit for each crossing of
navigable waters
X X Corps of Engineers Section 404 Permit where facilities affect wetlands
or involve dredge and fill
X xX USFS Special Use Permit to construct and operate facilities on
National Forest lands
xX FERC License to construct and operate hydropower facilities
jurisdictional under the Federal Power Act
Xx X Alaska Coastal Management Program Certificate of Consistency issued
by Division of Governmental Coordination
xX X Certification that proposed facilities can be constructed and operated in
compliance with State Water Quality Standards and the Federal Clean
Water Act (401 Certificate) issued by Alaska Department of
Environmental Conservation
x Xx Spill Prevention Containment and Counter Measure (SPCC)
Design/Plan required by EPA to comply with the Federal Clean Water
Act
Local government building permits and zoning requirements
xX xX Lease agreements with Native Corporations to cross corporation lands
A significant element of the environmental approval process is
determining environmental protection measures and enhancements,
and any potential environmental mitigation measures, that may be
required and assessing their effects on project feasibility. These
requirements may significantly affect project costs during
construction and through the life of the project. Under current
federal law, a number of federal agencies and state agencies with
delegated authority from federal statutes may prescribe mandatory
terms and conditions. State and federal agencies can also impose
terms and conditions through issuance of permits. Local
jurisdictions may require certain measures through zoning and other
local requirements. Table 7.8 presents typical environmental’
requirements associated with transmission and hydroelectric projects.
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Table 7.8
Typical Environmental
Protection, Enhancement
and Mitigation
Requirements Transmission
Line Segments and
Hydropower Projects
7.5.4
Review of Existing
Reports - Environmental
and Regulatory
Procedures
Typical environmental protection, enhancement, and mitigation are
listed in Table 7.8 Column "T" identifies transmission requirements;
Column "H" identifies hydropower facilities requirements.
T H ENVIRONMENTAL PROTECTION, ENHANCEMENT
& MITIGATION MEASURES
Water quality monitoring
X X Fish and wildlife
Scheduling construction activities to avoid adverse impacts
Habitat protection and enhancement
Avoid direct effects on anadromous fish streams
Xx X Soil and erosion control measures
Measures to avoid adverse project-related effects on threatened and
endangered species
Raptor protection measures
x Cultural, Historic, and Archaeologic Resources
Surveys
Avoid adverse impacts
Management plans where eligible or listed resources are present
X xX Scenic and Aesthetic Resource Protection
Avoid areas of primary concern
Revegetation and landscaping
Treatment of facilities
X X Recreational Resources
Surveys
Avoid areas of primary concem
Develop, operate, and maintain new facilities
X Xx Assess project-related effects on local services and facilities - schools,
hospitals, police, etc., during construction and operation
May require payment for services or development of new facilities
We reviewed a number of reports and interviewed utilities, state
government officials, and consultants to identify sources of available
information regarding proposed transmission line segments and
hydroelectric projects in Southeast Alaska. Reports relied on in
preparing this report include the following:
» Alaska Power Authority, Southeast Alaska Transmission Intertie
Study, October 1997;
> Department of Community and Regional Affairs, Division of
Energy, Kake-Petersburg Intertie Feasibility Study, January 1996,
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Table 7.9
Level of Investigation
Performed as of November
1997 Proposed
Transmission Segments
and Hydroelectric Projects
>» USDA Forest Service, Land and Resource Management Plan,
Tongass National Forest, 1997;
» USDA Forest Service, Swan Lake - Lake Tyee Intertie, Final
Environmental Impact Statement Summary, August 1997;
> USDA Forest Service, Swan Lake - Lake Tyee Intertie, Record of
Decision, August 1997; and
>» USDA Forest Service, Tongass Land Management Plan Revision,
Final Environmental Impact Statement, January 1997.
Table 7.1, Level of Assessment for Proposed Transmission
Segments, lists primary environmental issues identified and states the
existing level of review performed to date. Table 7.9 presents for
each phase, the level of investigation performed on the proposed
transmission segments and hydroelectric projects. A complete list of
reports reviewed is included in Appendix B and is available from the
Southeast Conference.
Proposed Status
Phase Intertie Segments & Environmental Review
Hydro Projects Approvals
I Swan Lake - Lake Tyee Intertie EIS and USFS Record of Decision
Issued - 8/97
Ketchikan - Metlakatla Intertie Reconnaissance level - 1987
0 Petersburg - Kake Intertie "Fatal flaw" review - 1996
Kake - Sitka Intertie Reconnaissance level - 1987
m Juneau - Sitka Intertie Appraisal level - 1987
Lake Dorothy Hydro Project FERC Preliminary Permit -
Preliminary review - 1996
Swan Lake Hydro Project Appraisal level - 1965
IV Juneau - Skagway Intertie Reconnaissance level - 1987
Takatz Lake Hydro Project Reconnaissance level - 1965
Vv Ketchikan - Prince of Wales Reconnaissance level - 1987
Scenery Lake Hydro Project Appraisal level - 1965
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7.6
Recommendations The general evolution of analyses presented in the 1987 Intertie
Study is entirely appropriate for the purpose of progressively
narrowing down the options to find the optimal development
sequence. However, we identified a number of specific concerns that
should be questioned in further analyses, and identified the need to
elaborate on some of the cost functions used in the comparison of
proposed line segments. The main issue in developing an integrated
electrical system is optimal timing of transmission extensions, and
ultimately the timing of future generation additions. Specific
concems identified include:
> suitability of assumed generation dispatch assumptions,
> appropriateness of adopted reserve margins;
> improved reliability of supply could not be quantified based on the
1987 analysis; and
> stated "Benefit-Cost" ratios are really the ratio between the Net
Present Value of the cost of the Base Case Diesel development and
the Net Present Value of the costs of the subject expansion plan.
General recommendations include:
> update relevant study results to a consistent basis;
> prepare a least-cost planning analysis; and
» evaluate cost-effective demand-side management programs options
on a sub-regional basis.
Due to the passage of time since the release of the 1987 Intertie
Study, we identified a range of concerns regarding the study findings:
» different base year;
» different base loads and growth rates, and later terminal year leads
to changes in forecast of replaceable diesel consumption at each
community, and more demanding load conditions for designed
transmission elements;
> different diesel fuel price projections
> different transmission and substation costs;
» different system losses due to different system load conditions; and
> recent commitments to selected grid extensions.
Recommended investigations and analyses to complete this
SYSTEM Plan include:
> update information available and relied on in preparing this Report
as noted above;
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Action Plan
> review basic designs for transmission lines and substations
presented in existing reports for adequacy. Develop a level of
detail adequate to provide a stronger foundation for developing
refined cost estimates;
> develop generic designs for stand-alone diesel generation supply
stations and for backup generating stations. Use stand-alone
stations in refined Base-Case development plan; assume standby
installation as grid is extended to each community;
> conduct a "fatal flaw" environmental assessment for each of the
selected line segments concurrent with engineering feasibility
investigations to determine whether an environmental issue of
significant magnitude would preclude construction and operation
of a line segment, even though reasonable mitigation measures
could be implemented;
> update economic parameters and assumptions used in evaluating
alternatives presented in the 1987 Study and apply in future
analyses regarding the proposed Southeast Alaska Electrical
Intertie SYSTEM.;
> prepare revised load forecasts for participating systems
recognizing phased development identified in this SYSTEM Plan.
Identify potential new large loads and determine each potential new
large load's energy plan with regard to self-generation and
interconnection with local utility to provide backup. Identify
conservation program actions to be implemented by potential new
large loads.
> investigate economies of scale available through multiple use
corridors:
— electricity transmission
— communications and fibre optics
— transportation
Acres International Corporation 7-29
LOAD CENTER
Existing Intertie
New Intertie
SOE Scenery Lake PpReS V)
ta Swan ee tax m)
” METLATAKA ~_
“4
Figure 1
Southeast Alaska Utilities ACHES
ELECTRICAL INTERTIE SYSTEM PLAN
h
1,000 MWh 4,600 —-———_—____— ec ] = :
| | |
Average Annual Loads
|
Average Annual Energy
w/ Potential New Hydro
Average Annual Energy
w/ Existing Hydro
1995 2000 2005 2010 2015 2020 2025 2030
Southeast Alaska Utilities ACHES ELECTRICAL INTERTIE SYSTEM PLAN : LOADS AND RESOURCES
8
References and
List of Preparers
Section 8
8.1
References Cited
References Cited and List of
Preparers
The following documents were used in preparing this report. A full list of
literature pertaining to topics covered in this report is located in Appendix B.
Copies of Appendices are available upon request from the Southeast
Conference.
Alaska Department of Community and Regional Affairs, Division of Energy,
Kake-Petersburg Intertie Feasibility Study. Prepared by R. W. Beck,
Inc.,1996.
Alaska Department of Community and Regional Affairs, Rural Alaska
Electric Utility Interties Preliminary Draft Survey. Prepared by Foster
Wheeler Environmental, Bellevue, WA., March 1987.
Alaska Electric Light and Power Company, Application for New License -
Annex Creek and Salmon Creek. Prepared by R. W. Beck, Inc., October
1985.
Alaska Electric Light and Power Company, Juneau 20-Year Power Supply
Plan Update. Prepared by CH2M Hill, Bellevue, WA., August 1990.
Alaska Power & Telephone Company, Application for License - Black Bear
Lake Project. Prepared by HDR Engineering, June 1994
Alaska Power Authority, Black Bear Feasibility Report. 1981.
Alaska Power Authority, Haines-Skagway Region Feasibility Study. Prepared
by R. W. Beck, Inc., 1981.
Alaska Power Authority, Southeast Alaska Transmission Intertie Study.
Prepared by Harza Engineering, October 1987.
Alaska Power & Telephone, Upper Lynn Canal Regional Power Supply
Review. Prepared by R. W. Beck, Inc., Seattle, WA., April 1997
Alaska Systems Coordinating Council and State of Alaska Department of
Community and Regional Affairs, Division of Energy, Alaska Electric
Power Statistics 1960-1995. Anchorage, Alaska, September 1996.
Acres International Corporation 8-1
References Cited and List of Preparers
Electric Utility System, City and Borough of Sitka, Analysis of Electric
System Requirements. Prepared by R. W. Beck, Inc., Seattle, WA, Apnl
1974.
Federal Power Commission and Forest Service - U.S.D.A. Water Powers -
Southeast Alaska. Washington, D.C., 1947
Ketchikan Public Utilities, Initial Draft Power Supply Planning Study.
Prepared by R. W. Beck, Inc., Seattle, WA, December 20, 1996.
Metlakatla Power & Light, Energy Generation Feasibility Study Report.
Prepared by Atlas Engineering Group, Baton Rouge, LA, March 31, 1997
McDowell Group, Inc., Trends in Southeast Alaska's Economy. Handout
prepared for Southeast Conference Annual Meeting, September 1997.
Petersburg Municipal Power & Light, Analysis of Electrical System
Requirements. Prepared by R. W. Beck, Seattle, WA, March 1974.
City and Borough of Sitka, Alaska, Electric Resource Evaluation and
Strategic Plan. Prepared by R. W. Beck, Inc., Seattle, WA, October 1991
Thomas Bay Power Commission, Petersburg - Wrangell, Appraisal Report.
Prepared by R. W. Beck, Seattle, WA., November 1975.
USDA Forest Service, Land and Resource Management Plan, Tongass
National Forest Tongass Land Management Plan Revision Final
Environmental Impact Assessment, August 1997.
USDA Forest Service, Swan Lake-Lake Tyee Intertie Final Environmental
Impact Statement Summary. Prepared by Foster Wheeler Environmental,
August 1997.
USDA Forest Service, Swan Lake-Lake Tyee Intertie Record of Decision.
August 1997
U. S. Department of the Interior, Alaska Power Administration/Bureau of
Reclamation, Takatz Creek Project - Alaska. Washington, D.C., 1960
8-2 Acres International Corporation
References Cited and List of Preparers
8.2
List of Preparers Nan A. Nalder, MPA, Project Manager. Project Descriptions, Economics
and Demographics, Environmental, Geography, Policy, Regulatory, Research,
and Report Editor. Acres International Corporation, Seattle, Washington.
Myles Godfrey, P.Eng, Transmission Line Segments and Systems
Operations. Acres International Limited, Toronto, Canada.
A. Richard Griffith, PE, Hydroelectric Projects. Acres International
Corporation, Seattle, Washington.
Kenneth Salmon, P.Eng, Electrical Equipment and Systems. Acres
International Limited, Vancouver, B.C.
Jeffrey Spencer, PE, Electrical Distribution and Transmission Review.
Elektron, Bend, Oregon.
Acres International Corporation 8-3
References Cited and List of Preparers
8.2
List of Preparers Nan A. Nalder, MPA, Project Manager. Project Descriptions, Economics
and Demographics, Environmental, Geography, Policy, Regulatory, Research,
and Report Editor. Acres International Corporation, Seattle, Washington.
Myles Godfrey, P.Eng, Transmission Line Segments and Systems
Operations. Acres International Limited, Toronto, Canada.
A. Richard Griffith, PE, Hydroelectric Projects. Acres International
Corporation, Seattle, Washington.
Kenneth Salmon, P.Eng, Electrical Equipment and Systems. Acres
International Limited, Vancouver, B.C.
Jeffrey Spencer, PE, Electrical Distribution and Transmission Review.
Elektron, Bend, Oregon.
Acres International Corporation 8-3