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Home My WebLink AboutSwan-Tyee Intertie Economic Analysis 2006SWAN - TYEE INTERTIE ECONOMIC ANALYSIS PREPARED FOR The FOUR DAM POOL Power Agency PREPARED BY Cay Commonwealth Associates, Inc. engineers + consultants + construction managers March 2006 TABLE OF CONTENTS PX CCANCNW @ 1 OUUMMI NMA SU Viorese coccccecocne se secsr sees tx seenscevsceqsesstnarsass ctasatsaemtucuscusnersrencstaseuas enetesusseseersssecssscecesceeresd soverss svenasaseosectees 1 ERNE OGM CEIOM) RING RUT POSE vcccesscczcacesacacecsesaceseccusscasesacosiscnenes ssucecs sysssseersnsesaiecstestesscansscécestateteszensrsvasrsssasessetescovesoseseseases 3 Methodology of Study . Amnutall COSt8 <cccccccsesecseneasossstesserearssesevvoreesvacesscisuseensee cesevoevessesesevresecyneeesnenscusveseatensessoeas eessesv¥ssesesecsstnetesseraeeesosneeev"sesst es 5 PROJECT BOCK Sr OUrnd UUs th Mi dencntaresenapn one reer ieacie ver oer aas soaser ser eeuer este Cee vee Ter Seel Ha LA eee LEED La Pe HERES SEEN ASSES Ceres Pb] DDCSI RIA CHELCT IGN sor ceasscscccesesn vance testy seTarsoistaereesoas been bates sbacore oesasnerssasasecrarmnsensucnpatseteuevenesoususessss stieseetorursetstuves eecees ors 6 Clearing Specifications ...5ccczeessnessasnsesvensssensctacnsssstssysbupstacssvsesrieeaunsewetisdttecsnoss seaseeeeeasacesonnsatevaneceescrmeqesssneeencenseses LL WNAGIIS), 1 nssc0 nce coves esacaene-ncesocosegeseseuswsvosgereescveerssuensRest eas V¥ue £54 Rev eleeuprogsesatyes ass tate ease saay Sever Gat pe AeEseaEST OTST NTs es ee 12 DAY Ret) 1g Ayn pecterere eee ee ERED RELA ULES ARENA aeRO EEOC CREDLE EEE EEO eee 15) OGM PORTA) GNA: COS ve stxsvceccrvassreeiessceserestritisonstaoys seer enapprencns nesnsneceenpsenceaneneneatecener sere vessoesservavetsvuseseseciever stots TS) Catastropliic Frailiires and Cost sav cvssrcacopecs eee seasessasas vanes cveess reset vtoe eee te eeT EAR UT UIA aT iss cove ncepeavarraeeetaeesoncesastasnesszense 19 Wrangell — Petersburg Load Resource Balance... Wrangell Petersburg. Wrangell and Petersburg: COMPING sassasccsssecssssosssxsxssiescvuscsouenssuateesasevssvsaseusiseatstestaresteetsecpeerecnessececareeeestenaensenco 25 Tyee Modeling en) cos satassessuensovnrsnsonenneusotonstetaueLessonss Suan test Sesser aope ose os EO OEE ESCEUEE EASES SEWECES EXER: BUCH 27 POTENT TRIVOT EA EEREETESS 27 Ketchikan Public Utilities Load Resource Balance ......scsssssssesesecesesessssssssssenesesesesssessssessnsesseneseecseseseceeneasseneneoeee 31 TOGA FOP CCAS oo cwex. seve sssnsa sssssevasystetopetonat snyrere Sate SE CHTVANEATUY, Fear ses Esneseodsoseraseeneqeesnsporeremnanasasnersctvecmenececenseevecoroesesee 31 GeneRAHOMPOFECASE ..sesssesesssvsvecesernservesusge sear uveutosa te csuspeyeyes eer ests ere SINE CELESEOR SF USUT VODs CH TTSON TESA Gas TOPSSUIG Sade soscuseonsaneeey 32 Ne eee Ode ooo oe er eee Ue HEU LLOLULLE SEMEL HELE Scie Lie it hele veunear idee vareEr Erte 33 Swan — Tyee Intertie Economic Model Resullts.........sssesssssssseceseseresesssesssssssnesencscsesesesesesesnsesessessenescsnssensneneneneneeeen 38 Methodology, arid ASstimp tions 'oscser csc secccuscssessaevscssnskasevusvasvesusutxarat seve sasterscesnivissstassssgvevaconesseoeresvonssoecnevencascnsencoves 38 Model Rests en eee oa oaebeasenceesuuuatusiseodaucastanetsae sueqcs conte Sa vesuce aay obasaa wsboos eect Monebsnansnabersrsenesa sy 40 BOSC CASE rss ele esetsalaclcesenatant enmmenenssniesdueievobsussaddat a bsker sascastsoers su aetnustusuddeselsessuts eee sa tins eeysn aus ust eye een 41 SQPRSHEV IED, FET sec accceoees erateeavs cuscuesnseataetivccecerectasPUesesNts nsartoies eseecaneonoepeepennene sosasnvsnenensuponsasaccevasucceiedotuesesemvaresesseseeietted 46 SGPASTELV ERY) EZ osc cons oes scanenssvese ye vasers sduwesecersc tats su aunsd Waaiestswsween seat WisasTssisuEREaNOnaaT abetes teeuses \osctbg sheneoecsasseeemnonsnsannasneanecen 50 SEVISTELVILY. HS ocacoccvvecnvsrsesecsonososbsuteses eeu oberstses- sete ciel sta dct ey sehtTEt ey pts eset CSDRSEESY SY SESYOES EVES FAR SORE G73 FSO: TSUSE SE STVVESSTNGATASEASECT 54 SCPASEEEVILY, {fa cres tence ood Meta nacre te et nta ra eae re cp eonaaeners paeea ites dccaseh olor Rneeaan sau bue Very usar ev LEE uaa esenet see venaesoe eG 58 ISCVASTLIVILY 169 savas cneresus <soeonensesx ces rcesessoos aaseastasvsvsUstsENTesAst sass sAssnepenensnseeyacecsaseccenersmeentnenenseeretsnensessntonecucnseneanesesuacaences 62 (CONCHISIONS soccosevesecesesnsneoesesosecocorsessoresoseesseresescecsotocoses cosesevesuees oesecessrevessoesessssen sesss evesessésenesess sesccestostetssStssue esseseevasess| 66 Appendix A — Converting Tyee CFS to KWM ..........cscccsrssssvsrecsesoscescscovocscococsesoecoosesesceseseocesseenecessesoscesescsssoocsesossooes 67 Appendix B — Net Revenue and Net Present Value Results For All Cases Nominal Net Revenues For All Cases Net Present Values For All Cases... utive Summary The Four Dam Pool Power Agency (FDPPA) is a joint action agency organized and existing pursuant to the laws of the State of Alaska. Two electric cooperatives (Copper Valley Electric Association, Inc. and Kodiak Electric Association, Inc.) and three municipalities (Ketchikan, Petersburg and Wrangell) created FDPPA in 2002. Those five organizations continue as members today. FDPPA owns, manages and administers four hydroelectric projects (Terror Lake, Solomon Gulch, Swan Lake and Lake Tyee) and related transmission facilities. The State of Alaska built or acquired these projects in the early 1980’s and sold them to FDPPA in 2002. The Swan — Tyee Intertie (STI) is a 57-mile, high-voltage transmission line currently under development by FDPPA. This transmission line will interconnect the Lake Tyee Hydroelectric Project south of Wrangell with the Swan Lake Hydroelectric Project near Ketchikan. FDPPA owns the two hydroelectric projects and will own and operate the STI. Significant work has been completed to date on the STI. Construction is currently on hold pending additional funding. Approximately $55 million of the estimated $110 million (2006 dollars) construction cost has been spent to date. FDPPA retained Commonwealth Associates, Inc. to perform an economic analysis of the STI. The primary purpose of this analysis is to: 1. Estimate the annual operation and maintenance cost of the Intertie. 2. Estimate the annual renewals & replacement costs associated with repairing damage from catastrophic failures. 3. Estimate the power flows over the line and resulting revenues to the FDPPA. 4. Estimate the annual net revenue and the net present value of the above costs and revenues over the study period. The analysis used high, base and low growth projections! for both Ketchikan and Wrangell/Petersburg, and high, low and historic inflows” at both the Tyee and Swan Lake reservoirs as well as the Ketchikan-owned hydro facilities. Use of the inflows to serve load was modeled month-by-month over a 30-year period for each case, with emphasis on the historic flows as the most accurate representation of likely outcomes. Based on the study’s assumptions and the above methodology, the analysis yielded the following conclusions: ' Average annual rates of growth for the various load growth cases are as follows: Ketchikan low = 0.25%, medium = 0.80%, high = 2.00%; Wrangell/Petersburg low = -0.50%, medium = 0.00%, high = 2.00%. * High and low inflows represent some of the highest and lowest actual inflows from historical records. The historical inflows cases use a cycle of monthly inflows from 26 years of records for Tyee and 14 years of actual and derived data for Swan Lake. Historical inflows represent a cycle of higher and lower inflows that are likely to occur naturally through time. VAY Commonwealth Associates, Inc. Page 1 chginee ts -cosuliints construction managers « $500,000 Annual Cost To Operate and Maintain: The study estimates the combined operations, maintenance, renewals and replacements over the 30-year study period to be approximately $15.5 million or a little more than $500,000 per year in 2006 dollars. « STI Total Revenues Will Exceed Total Operating Costs: Using the study’s base case assumptions, over the 30 years analyzed, the total revenues from power sales to Ketchikan over the STI will more than cover the annual costs of maintaining and operating the line. However, there may be individual years, or groups of years, particularly early in the analysis, when operating costs may exceed revenues. The following table shows the net present value of the total net revenues under various load growth assumptions. Net Present Value of Net Revenues Over Study Period Base Case Assumptions Historic Inflow Assumptions Wrange etersburg Load Base High Low Z| Base $15,248,168 $10,080,731 $16,435,511 3 High $33,991,722 $21,799,808 $37,043,294 2 Extra High $38,821,737 $25,720,483 $42,753,763 x |Low $4,257,705 $4,257,705 $4,578,404 « Debt Service Costs Impair The Economics: When debt service costs were included, STI total revenues failed to cover total costs when Ketchikan load growth was low or inflows were high. However, even in the cases where total revenues exceeded total costs, there were normally individual years or groups of years when revenues fell short thereby impeding the consistent payment of debt service. ¢ An Increase in Ketchikan Hydro Generation Hinders the Positive Economic Outcome: A major increase in the Ketchikan-owned hydro generation reduces the need for power flows over the STI and forces the economics of the STI negative in the situation where Ketchikan load growth is low or inflows are high. ¢ Prolonged Extreme Weather Conditions Could Affect the STI Economics: The study determined that extended periods of minimum or maximum inflows could have major impacts to the economics of the line. However, the likelihood of these conditions extending through the entire life of the project is low. The overall results of the study show that, over the first 30 years, it is reasonable to expect the revenues from the sales of power over the STI to exceed costs of maintaining the line. While the study’s assumptions certainly influence the outcome, these results hold up for nearly all reasonable scenarios. Cay Commonwealth Associates, Inc. engineers scomsnltanis constuction managers Page 2 Introduction and Purpose Commonwealth Associates, Inc (“CAI”) is pleased to present to the Four Dam Pool Power Agency (“FDPPA”) this report summarizing the economic analysis of the Swan — Tyee Intertie (“STI”) conducted by CAI in accordance with the Notice of Award from FDPPA dated November 30, 2005. The Swan — Tyee Intertie is a 138-kilovolt (kV) transmission line proposed to run between the Lake Tyee Hydroelectric Project located approximately 40 miles southeast of Wrangell, Alaska, and the Swan Lake Hydroelectric Project located about 22 miles northeast of Ketchikan, Alaska. The Four Dam Pool Power Agency (“FDPPA”) located in Anchorage, Alaska will own and operate the STI. The STI will be approximately 57 miles in length and is located in a remote mountainous area generally accessible only by air. Work completed to date on the STI includes line routing, line layout and design, initiation of structure purchase, right-of-way clearing and installation of a portion of the foundations. Construction is currently on hold awaiting additional funding and results of ongoing re-evaluation of the STI economics. To date, approximately $55 million has been spent of the estimated total construction cost of $110 million (2006 dollars). The purpose of this economic analysis is to: Le Estimate the annual operations and maintenance costs of the intertie. Estimate the annual renewals and replacement costs associated with repairing damage from catastrophic failures. Estimate the power flowing over the line and the resulting revenues to FDPPA. 4. Estimate the annual net revenue and the net present value of the above costs and revenues over the study period. i Those purposes have been achieved and this report presents the results of this economic analysis. Cay Commonwealth Associates, Inc. Page 3 engineer -comulintm «contruction managers Methodology of Study The Lake Tyee Hydroelectric Project (“Tyee”) at the north end of the STI serves the loads of the Wrangell — Petersburg area. At this time, there is normally significant energy remaining in the Tyee reservoir after serving the Wrangell — Petersburg loads. The Swan Lake Hydroelectric Project (“Swan”) at the south end of the line serves the loads of the Ketchikan area. While there is normally some excess energy at Swan after serving the Ketchikan loads there is much less than there is at Tyee. Any excess energy at Swan may be used by load growth over the study period. Additionally, low inflows at Swan Lake due to dry weather may reduce or eliminate excess energy at Swan. In simplistic terms, this study can be thought of in the following way. Loads & Loads & Resources Resources Ketchikan Operations &Maintenance Wrangell - Renewals & Replacements Petersburg Whether or not power will flow over the line will depend upon the relative load/resource balance positions of the Wrangell — Petersburg area and the Ketchikan area. Multiple resources and loads in both areas must be considered. This study went through the following steps to achieve its purposes. Estimate the annual costs of the line. Estimate the load resource balance at the Wrangell — Petersburg end of the line Estimate the load resource balance at the Ketchikan end of the line. Estimate the power that will flow over the line and the resulting revenues to FDPPA. Evaluate these revenues and costs and determine the net present value. Pe SS CAI believes that the assumptions used in this study and the forecasts and results of this study are reasonable. However, the results of actual operations may be significantly different from those forecast due to actual conditions or events. CAI has relied upon information provided by FDPPA, Wrangell, Petersburg, Ketchikan and others and, while CAI believes the information is reliable, it has not been independently verified. Cay Commonwealth Associates, Inc. Page 4 engmeer -Comsphanhs -constracten managers Annual Costs Project Background General Design The STI will be approximately 57 miles in length and is located in a remote mountainous area generally accessible only by air. The line is designed to carry a single conductor per phase. The conductor will generally be 397 kemil AACSR/AW 30/7 (LarkSP) conductor at the lower elevations and 37 No. 8 Alumoweld conductor at the higher elevations and for the extremely long spans. The support structures for the line will be tubular steel. Tangent support structures will generally be Y-Type structures. At the higher elevations, a steel self-supporting H-type structure will be used. Dead-end and angle structures will generally be guyed single-pole (3 poles/structure) steel structures. Extremely long spans will be supported with an A-frame type structure, one per phase. History of Project Design The design process for the STI has taken many years because of delays in funding and permitting. Ketchikan Public Utilities (“KPU”) contracted with Raytheon (which later became the Washington Group) to provide engineering design services for the STI in 1994. A design review meeting held in October 1997 reported that the line design was essentially complete. In December 2002, Power Engineers, Inc. (“POWER”) was contracted by KPU to perform a peer review of the design. The peer review: ie Assessed the criteria used in the line design. 2s Discussed the applicability of the structures, wires and foundations for use on this specific line. 8; Provided recommendations based on POWER’s experience with the Tyee Intertie line, which is located in the same geographical area. In 2004, the project was transferred from KPU to the FDPPA. Prior to the transfer, FDPPA contracted with Dryden & LaRue, Inc. (“D&L”) to review the line design. Later, D&L was selected as the Engineer of Record for the project. Following a review of the design documents provided by the Washington Group and with consideration of the POWER peer review, D&L made some modifications to the design criteria and modified aspects of the design to improve constructability and performance. The project design based on the revised design criteria is Cay Commonwealth Associates, Inc. eaQHEe -consuhants . construction manager Page 5 nearing completion; however, it is not complete and construction drawings have not been finalized. The project is currently on hold pending additional funding. Design Criteria General Early stages of the design process included numerous studies to determine the appropriate routing, voltage level, structure type, conductor selection and design criteria. The routing of the line was influenced by environmental studies and was not selected solely on design merit. The design process included consideration of meteorological and geotechnical studies along the route. The pe Cay The following studies were made available to CAI: September 1995, Meteorological Evaluation of the Proposed Swan Lake Intertie Route (Interim Report), KPU Contract No. 94-45, Richmond Meteorological Consulting, Atascadero, CA 93422 December 1995, Transmission Line Conductor Selection Report, KPU Contract No. 94- 51, Raytheon Infrastructure Services Incorporated February 1996, Transmission Line Structure Study Report, KPU Contract No. 94-51, Raytheon Infrastructure Services Incorporated July 1996, Geologic Reconnaissance Swan Lake to Shrimp Bay and Eagle Bay to Lake Tyee, Swan Lake — Lake Tyee Intertie Project, Dames & Moore September 1996, Study of Intertie Voltage Selection and Load Flow Analysis, Raytheon Infrastructure Services Incorporated August 1997, Geologic Reconnaissance Shrimp Bay to Eagle Bay, Swan Lake-Lake Tyee Intertie Project, Dames & Moore. er review conducted by POWER in 2002 resulted in the following recommendations: It is recommended that the design be compared to the requirements of the 2002 edition of the NESC, and that it be brought into conformance with the 2002 edition that was issued on August 1, 2001, and became effective on January 28, 2002. POWER recommends that the line designer investigate the capability of the micropile foundations to resist the moments caused by longitudinal unbalances of the nature experienced on the Tyee Intertie project. Commonwealth Associates, Inc. Page 6 engineer consultants + construction managers POWER recommends that careful attention to detailing on the structures be observed to avoid “pockets” where water can stand and prevent the required wet- dry cycle on the steel. This is an issue of enough importance that we recommend the line designer verify the line’s clearance performance under unbalanced ice dropping conditions. There were also survey inaccuracies on the Tyee line that worked to produce clearances that were less than design. The high tension in the wire under heavy ice, compared to the longitudinal strength of the structure, is another factor leading POWER to recommend a second look at the longitudinal strength of the structures. We recommend that the designer carefully consider the effects of longitudinal unbalance on the foundations. (Final Report Swan Lake-Lake Tyee Transmission Line Design Review, Power Engineers, December 2002) The peer review considered the appropriateness of the design criteria relative to NESC (Code) requirements and specific geographic and meteorological conditions. The peer review did not include a detailed review of the line layout (structure spotting) or specific detail design features (i.e., structures, foundations, hardware, etc.). The Engineer of Record (D&L) has considered the peer review recommendations and, based upon the peer review and their own experience with lines in similar environment, has modified the design criteria to add more longitudinal strength to the towers. D&L has also made a number of changes to the layout of the line, the support structures and the foundations based upon their experience with lines located in SE Alaska. Weather-related Design Criteria A summary of the design criteria developed by Raytheon Engineers & Constructors (as presented in a slide presentation, October 1997) follows along with a marked-up copy of the criteria developed by the current Engineer of Record, D&L. Cay Commonwealth Associates, Inc. Page 7 ecngineees scumsuliints -coostruchon managers PROJECT REVIEW C. Detailed Design 1. Design Criteria Loading Conditions Low altitude section NESC: 0 degrees, 1/2" radial ice, 4 psf wind Heavy Ice: 30 degrees F, 1.5" radial ice, no wind on conductors, 4 psf wind on structures High Wind: 40 degrees F, noice, 26 psf wind Combined Snow/Wind: 30 degrees F, 1.47" radial ice and 4.9 psf wind equivalent for 3.3” radial wet snow Low Temp: -5 degrees F, no wind, no ice EDS: 40 degrees F, no ice, no wind Hol Sag: 120 degrees F, no ice, no wind High altitude section and Water Crossings NESC, Heavy Ice, Combined Snow/Wind, Low Temp, EDS, Hot Sag: Same as low altitude High Wind: 40 degrees F, no ice, 37 pst wind on conductors, 50 psf wind on structures Extreme Snow/Ice: 20 degrees F, 1.72" radial ice equivalent to 3.86" radial wet snow, no wind Raytheon Engineers & 42 Constructors PROJECT REVIEW C. Detailed Design 1. Design Criteria (cont.) + Conductor Tensions Low altitude section 16%, RTS, final @ EDS 70% RTS, final @ heavy ice High altitude section and Water Crossings 22% RTS, final @ EDS 70% RTS, tinal @ heavy ice 90% RTS, final @ extreme snow/ice « Safety Factors/Overload Capacity Factors- Loads Comb. Extreme Heavy High Snow/ Snow/ NESC __tce_ Wind Wind Ice Vertical a iba ne a 1.0 Transverse 2.5/1,65 11 1.1 Eel 1.0 Longitudinal 1.1 a hal 1 1.0 Ss 5 Raytheon Piyincers & 0 Constructors Cay Commonwealth Associates, Inc. engincen -consnliants -construction managers Page 8 PROJECT REVIEW C. Detailed Design PROJECT REVIEW C. Detailed Design 1. Design Criteria 1, Design Criteria (cont.) Loading Conditions 2» Conductor Tensions Low altitude section Low altitude section 16%, RTS, final @ EDS NESC: 0 degrees, 1/2” radial ice, & psf ind, ABE in on 70% RTS, final @ heavy ice Heavy Ice: 30 degr; gs F, 1.5” radial ice. conductors, Xba wind on structur High Wind: 40 degrees F, no ice, High altitude section and Water Crossings 22% RTS, final @ EDS 70% RTS, final @ heavy ice Low Temp: -5 degrees F, no wind, no ice 90% RTS, final @ extreme snow/ice - 40 deoprees F, no lee, na wind Sag: 120 degrees F, no ice, no vind Ont 4, Long he F, | “Cadind \ excep ot on sega aig ond. Habe tos High altitude section and Water Crossings mis lm Ves Safety Facters/Overload Capacity Factors- Loads Heavy High NESC, Heavy Ice, Combined Snow/Wind, Low Temp, HESC __Ice Wind __Wigd EDS, Hot Sag: Same as low altitude Vertical 1.5 11 1.1 High Wind: 40 degrees F, no ice, 3? psf wind on Transverse 2.5/1.65 1,20 1.1 conductors, 50 psi wind on structures Longitudinal 1.1 dia. jareta-apeentiah ; Heav4 Tees Zorr, 176" radial ice, ‘Gee “as cpp, eit . eens - Unbahar se Leng: tudsnol; 30°F, | Codiak ice except one” side of an a ane pinse has Revised. Zoot he conducto— L= M,coe lbs. Dryden ¢ lekve, Fae: J Commonweatth Associates, Inc. Page 9 engineer -consnlizets construction managers The basic design criteria for this line are considerably more stringent than standard code requirements. This is appropriate given the severe Southeast Alaska conditions, remoteness of the line and history of lines in the immediate area. The design criteria have been developed with the intent of having a slightly conservative design based on a 50-year recurrence period for wind and ice loading. This line has had the benefit of being reviewed by several engineering firms with extensive experience with lines constructed in similar terrain/climates, including the two lines that this project will interconnect. The peer review conclusion in 2002 was that the line would generally meet the goal of “a slightly conservative design based on a basic 50 years recurrence period” with the following caveat: “an exception to the above conclusion was that the peer review considered the longitudinal loading to be less than they would recommend.” The revised D&L criteria have increased this longitudinal loading, and the current suggested design appears to be based on criteria that do meet the goal of “a slightly conservative design based on a basic 50 years recurrence period.” As stated in the peer review (italics added for clarity): The structures are designed to withstand the 50-year RP (Recurrence Period) loads identified in the meteorological evaluation, and utilize strength and load factors (combined into an OCF) consistent with the requirements for a slightly conservative design to minimize failures. It should be noted again that the 50- year return period design is not a guarantee of a 50-year life, or that the loads will occur only once in the 50-year period. They merely indicate that the loads have only a 2 percent probability of being exceeded in each year, but that they have a 64 percent probability of being exceeded at least once during the 50 years (45.5% probability of being exceeded at least once in a 30-year period). (Final Report Swan Lake-Lake Tyee Transmission Line Design Review, Power Engineers, December 2002). In conclusion, the STI project has the advantage of the experience gained from the operating history of both the Swan Lake (since 1985) and the Lake Tyee (since 1984) lines. The loading criteria developed for the STI line are generally more conservative than the criteria used for the Swan Lake line and considerably more conservative than the original criteria used for the Tyee line. Relative to standard weather-related loading (wind, ice, temperature) it is safe to say that the design criteria developed, reviewed and refined by a number of engineers with extensive line design experience in Southeast Alaska should result in a line that is more resilient than either of the other two lines it will interconnect. VA] Commonwealth Associates, Inc, Page 10 engIpCer -ConsMILans . construction managers Non-weather Design Considerations Factors that are most likely to result in line failure other than weather-related conditions and that are not directly related to standard weather loading criteria include the following: Tree strikes Landslides Avalanches Vandalism Design errors e Manufacturing failures Support structures are not designed to withstand forces caused by tree strikes, landslides or avalanches. The routing of the line provides the primary avoidance mechanism for landslides and avalanches. Attempts were made to route the line away from known slide areas; however, outside factors did not allow complete freedom of the line route. The majority of the line is not in an area prone to landslides and avalanche. Vandalism is normally not a serious problem and is not predictable except perhaps from historical records. No information is available to indicate that vandalism is a serious issue in the area of the STI line. The line’s remoteness should reduce the number of such incidents. Design errors do occur, but the probability of design error causing a serious operation and maintenance issue is remote. Manufacturing failures also occur, but are seen as low probability. Clearing Specifications A clearing and logging contract for the STI line was let in 2003. This contract generally required a varying width (100 to 200 foot) clear-cut following the proposed transmission line centerline. The clear cut was offset toward the uphill side to maximize its effectiveness. However, even a 200 foot width on steep slide slopes is not sufficient to eliminate all tree strikes. The clearing specification required that in addition to the clear cut all danger trees (any tree that could rotate about its base and strike the line) be removed. It is our understanding that danger trees were marked but were not removed in 2003. It is also our understanding that several sections of the line were being considered for relocation and that these portions were not cleared. The current project schedule is based on construction being complete in 2008. It has been assumed that the remaining clearing and danger tree removals will be completed prior to the completion of construction. It has also been assumed that the portions of the right of way that were cleared in 2003 will be re-cleared as appropriate so that right-of-way maintenance will not be required for the first 3 to 5 years. Following a clear cut, the first severe storm often takes out additional trees that were protected by the surrounding trees prior to the clear cut. This line has the advantage that much of the Cay Commonwealth Associates, Inc. Page 11 engineer -ConsulLanm construction managers clearing was completed in 2003, and the trees left standing at the edge of the clear cut will have weathered several seasons prior to actual line construction. These pre-construction storms will have eliminated many of the trees that were exposed by the clear cut and thus should reduce the number of potential strikes in the early years of the line. The low altitude sections of the line will require clearing as often as every 3 to 5 years. The alders, prevalent in the low areas grow 5 feet or more a year. Above 500 feet, the conifers grow at a much slower rate, requiring less frequent clearing, perhaps every 10 to 12 years. Maps The following two pages include maps of the proposed line. Cay Commonwealth Associates, Inc. Page 12 cagincer -consulLants construction managers Scale 1” = 6 miles (1:506,80) ; ee 115/138 kV Transmission Line| ae : Four Dam Poo! Power Agency February 13, 2006 CAs emvnin imei: Cay Commonwealth Associates, Inc. Page 13 SO ae : \ <i agave aN PAL ca ve ee Sole te oo Ae N Ld ne i | Ex WY iC = Key Features Key features considered in evaluation of the potential 30-year O&M plan and budget include the following: Line design criteria Right-of-way clearing criteria Line routing (side hills and elevation) Terrain and climate Remoteness (helicopter access) Quantities; line length, structure sites, structure types History of similar lines O&M Program and Cost General The following proposed O&M program for the STI line is similar in scope to what is now being implemented on the Swan and Tyee transmission lines. The program outlined and the associated costs assume O&M for the STI line will be a stand-alone contract. However, some economies may be realized if a single O&M contract is let for all three lines as a group. The costs assume that the O&M contracts will be multi-year (2-3 years minimum) and that a two to three week line outage period will be available in the May through July period. It is recommended, and it has been assumed, that the work will be completed under three separate contracts: e Facility inspection and maintenance e Thermographic inspection e Right-of-way maintenance and clearing The separation of these contracts should result in cost savings by making maximum use of specialized labor while at the same time making use of local expertise and labor. Line Access Access to the line is a major cost item. Access is generally limited to helicopters. It has been assumed for this study that permanent helicopter landing sites will be developed during the construction phase and that these landing sites will be located along the line route and will provide access to all structures with no more than one-half mile required travel between a landing site and a line structure. If permanent sites are not established during the construction phase, future O&M contractors will be required to build temporary sites, the cost of which is not included in the annual O&M cost in this study. If permanent sites are constructed, it is important that they be adequately maintained, preventing them from becoming either unusable or a safety hazard. Cay Commonwealth Associates, Inc. Page 15 cagineer -consuhants -coostruction managers Portions of the line that are located near water have a cost advantage since a barge can be located for fueling and staging of work that is in close proximity to the work site. The remoteness of the STI line and distance from water was considered in the cost estimates. Facility Inspection and Maintenance Program A. Climbing Inspections The proposed O&M program is based on a climbing inspection of 15 structure sites each year. The 15 sites would be selected to include a minimum of one of each structure type on the line. The 15-site rotation would result in all structure types undergoing a climbing inspection every year and all structures on the line being climbed once every 20 years. Climbing inspections will include a thorough visual inspection of the structure and all appurtenances. The climbing inspection team will also be required to perform routine maintenance. The inspection and maintenance will include climbing each structure. In the case of multi-pole structures, each pole will be climbed. The inspection will require observing and recording the condition of the structure including foundation, guys, anchors, poles, arms, attachments, insulators, insulator hardware, conductor attachment hardware and dampers. The observations will include checking the condition of all bolts, nuts and cotter keys. Maintenance items requiring repair at the time of the climbing inspection include: Loose guys Missing or damaged cotter pins Loose or missing bolts, nuts and locknuts Damaged insulators Damaged guy and guy insulator hardware Damaged hardware Guy guards Dampers (fatigued, broken or missing) Based on the maintenance history of the Swan Lake and Tyee lines, the dampers begin to fail at 10 to 12 years of service. Therefore, the proposed O&M program has assumed that dampers will be replaced on all structures undergoing a climbing inspection after the first 7 years. By year 15, over 40 percent of the dampers will have been replaced and the dampers that are being replaced can be inspected to determine if the damper replacement program needs to be maintained or accelerated. The cost estimate considers damper replacement starting in the eighth year. The inspection program will need to carefully select the structures to be climbed based on the previous year’s findings and consideration that more attention should be given to the high altitude and long-span structures. Failures in these areas can result in extended outage time and costly repairs. Cay Commonwealth Associates, Inc. Page 16 engipce rs sComsultanits construction managers B. Visual (on ground) Inspection Visual inspections include correcting minor items that can be accessed from the ground, such as loose guys and missing or loose nuts and bolts. Binoculars will be used to inspect the tower and appurtenances not accessible from the ground. The proposed O&M program is based on providing a visual (on ground) inspection of 40 structure sites each year. The 40 sites would be selected to include a minimum of one from each structure type on the line. The 40-site rotation combined with the proposed climbing inspection (of 15 sites each year) would result in all structure types undergoing a detailed inspection (climbing or visual) every 5 years. C. Helicopter Survey A helicopter review of all structure sites should be completed a minimum of once each year. The survey should be completed by an experienced lineman and should include a review of the conductor, insulators, structures, structure sites, helicopter landing sites, and right-of-way conditions. D. Maintenance Materials Most materials used on the STI line are long-delivery items. It has been assumed that, as part of the construction contract, sufficient spare materials for routine maintenance and any catastrophic failures that may occur will be purchased and stockpiled. These materials will include temporary spare structures sufficient to support the line for emergency repairs, conductor, hardware, insulators, foundation materials, compression dead-ends, guy wire, guy materials, dampers, armor rods, anchor rods and other minor materials. CAI estimates the cost to maintain spare materials inventory, including material replacement, to be approximately $20,000 every 5 years. Repair of the following defects, if noted, during any of the above inspections is not included in the routine yearly maintenance program but would be corrected based on either cost-plus or a negotiated price with the contractor. A contingency is included to cover these costs. e Dents, cracked welds ¢ Bent or pulled anchor rods ¢ Missing or damaged grout ¢ Foundations that are leaning or eroding ¢ Foundation welds E. Cost Materials for routine maintenance will be from the spare parts maintenance supply established as part of the initial construction contract. Costs for the re-supply of the maintenance items are included in the O&M cost estimate. Cay Commonwealth Associates, Inc. Page 17 engineer scomsulants construction managers The costs assume that the inspections will be completed when the line is de-energized and that it will be de-energized for a minimum of two to three weeks during the May through July period. The costs assume that the climbing, visual and helicopter inspection work described above will be let as one contract as is currently the practice. The contractor will furnish all labor, tools and access. Helicopter landing site will generally be no more than 2000’ from structure sites. Cost Summary by Function (2006 dollars) Climbing Inspection Years 1-7 Years 8+ Mobilization/demob $ 12,000 $ 12,000 Climb structures 15 @ $6,000.00 each $ 90,000 $ 90,000 Damper change out $ 0 $ 13,000 Contingent sum $ 30,000 $ 30,000 Total $132,000 $145,000 Visual (on ground) Inspection Mobilization/demob $ 10,000 Visual Inspection 40 @ $1,000.00 each $ 40,000 Contingent sum $ 10,000 Total $60,000 Helicopter Survey $15,000 Thermographic Survey After the line is energized and placed under load, a thermographic survey of all connections on the line needs to be performed. The aluminum bolts connecting the jumper paddles on the dead- end structures can be “over torqued,” leading to a bad connection and ultimate line failure. Ideally, this survey should be done just prior to the climbing inspections and every 5 years thereafter. Thermographic Survey $18,000 Right-of-way Clearing The very low-altitude sections of this line will require frequent clearing, as often as every 3 to 5 years. The alders, prevalent in this area, have been known to grow 5 feet or more per year. Above 500 feet, the conifers will grow at a much slower rate and require clearing on a less frequent cycle, approximately every 10 years. Gy. e Associates, Inc, Page 18 engineer -Cunsulants copstruction managers Clearing around helipads will be required every 3 years. The maintenance clearing cost estimate is $140,000 yearly starting in year three. The cost is based on completing approximately 15-20 % of the line length resulting in a complete clearing cycle every 5 to 7 years. Right-of-way Clearing $140,000 Catastrophic Failures and Cost Long-span Conductor Drop This situation has occurred on the Tyee Lake line when a compression dead-end failed. In this case, the span length was approximately 5,000 feet and the conductor was 37 No. 8 Alumoweld. It is assumed there is a probability of this happening on the STI line at least once in the line’s 30- year life. The cost for repairing long-span conductor drop can vary greatly, depending on the span. Steep canyon and water crossings could cost much more to repair than long-span valley crossings. The cost for this type of repair will be between $250,000 and $400,000, depending upon the location. For the purposes of this study, the cost estimate assumes a cost of $325,000 occurring at year 15. Mudslide/Landslide/Avalanche Landslides and avalanches occur frequently in Southeast Alaska. Two towers on the Tyee line, three towers on the Snettisham line and one 3-pole structure on the Swan Lake line have been destroyed by slides since construction. Given the “side hill” routing of the STI, it is reasonable to assume that a structure site will be impacted by a slide every 10 years. The cost for repair would be determined by many factors, such as, location, type of tower and whether the tower and foundation must be relocated. The cost for this type of repair would be between $350,000 and $1,000,000. For the purposes of the cost estimate, an average cost of $675,000 was used, occurring at 10-year intervals starting at year 5. Tree Strikes Where the STI is routed on steep slopes, the probability of a tree strike is high. Trees that roll downhill and hit towers, foundations, or guy wires could do severe damage. Mid-span conductor hits would do much less damage. A tree strike should be expected every 4 to 6 years. The cost for this type of repair would be between $50,000 and $250,000. For purposes of the cost estimate, an average cost of $150,000 was used, with an occurrence the first year and years 5, 15, 20 and 25. Cay Commonwealth Associates, Inc. Page 19 engINC Ce Consuls -construEtiON managers 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 CAy 2006 Dollars Operations and Maintenance Catastrophic Failures Total Climbing Visual Helo Thermo Materials ROW Admin. Cond. Mud/Land Tree Annual Inspect. Inspect. Survey Survey __Replacement__Clearing _Insurance_Land Use_Expenses_Sub Total Drop Slide Strike __ Sub Total Costs $132,000 $60,000 $15,000 $18,000 $4,480 $31,950 $18,000 $279,430 $150,000 $150,000 $429,430 $132,000 $60,000 $15,000 $0 $4,480 $31,950 $18,000 $261,430 $0 $261,430 $132,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $401,430 $0 $401,430 $132,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $401,430 $0 $401,430 $132,000 $60,000 $15,000 $0 $20,000 $140,000 $4,480 $31,950 $18,000 $421,430 $675,000 $150,000 $825,000 $1,246,430 $132,000 $60,000 $15,000 $18,000 $140,000 $4,480 $31,950 $18,000 $419,430 $0 $419,430 $132,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $401,430 $0 $401,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $20,000 $140,000 $4,480 $31,950 $18,000 $434,430 $150,000 $150,000 $584,430 $145,000 $60,000 $15,000 $18,000 $140,000 $4,480 $31,950 $18,000 $432,430 $0 $432,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $20,000 $140,000 $4,480 $31,950 $18,000 $434,430 $325,000 $675,000 $150,000 $1,150,000 $1,584,430 $145,000 $60,000 $15,000 $18,000 $140,000 $4,480 $31,950 $18,000 $432,430 $0 $432,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $20,000 $140,000 $4,480 $31,950 $18,000 $434,430 $150,000 — $150,000 $584,430 $145,000 $60,000 $15,000 $18,000 $140,000 $4,480 $31,950 $18,000 $432,430 $0 $432,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $20,000 $140,000 $4,480 $31,950 $18,000 $434,430 $675,000 $150,000 $825,000 $1,259,430 $145,000 $60,000 $15,000 $18,000 $140,000 $4,480 $31,950 $18,000 $432,430 $0 $432,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $140,000 $4,480 $31,950 $18,000 $414,430 $0 $414,430 $145,000 $60,000 $15,000 $0 $20,000 $140,000 $4,480 $31,950 $18,000 $434,430 $0 $434,430 $15,539,900 Commonwealth Associates, Inc, Page 20 cagineers -conuliants contruction managers Table 1 Projected Annual O&M and Catastrophic Failures Costs 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 Cay Operations and Maintenance Catastrophic Failures Total Climbing Visual Helo. Thermo. Materials ROW Admin. Cond. Mud/Land Tree Annual Inspect. Inspect. __ Survey __Servey _ Replacement__Clearing _Insurance_Land Use_Expenses__ Sub Total Drop Slide Strike Sub Total Costs $142,150 $64,613 $16,153 $19,384 $4,824 $34,407 $19,384 $300,916 $161,534 $161,534 $462,449 $145,703 $66,229 $16,557 $4,945 $35,267 $19,869 $288,570 $288,570 $149,346 $67,884 $16,971 $158,397 $5,069 $36,148 $20,365 $454,181 $454,181 $153,080 $69,582 $17,395 $162,357 $5,195 $37,052 $20,874 $465,536 $465,536 $156,907 $71,321 $17,830 $23,774 $166,416 $5,325 $37,979 $21,396 $500,948 $802,363 $178,303 $980,666 $1,481,614 $160,829 $73,104 $18,276 $21,931 $170,576 $5,458 $38,928 $21,931 $511,035 $511,035 $164,850 $74,932 $18,733 $174,841 $5,595 $39,901 $22,480 $501,331 $501,331 $185,612 $76,805 $19,201 $179,212 $5,735 $40,899 $23,042 $530,505 $530,505 $190,253 $78,725 $19,681 $183,692 $5,878 $41,921 $23,618 $543,768 $543,768 $195,009 $80,693 $20,173 $26,898 $188,284 $6,025 $42,969 $24,208 $584,260 $201,733 $201,733 $785,993 $199,884 $82,711 $20,678 $24,813 $192,992 $6,176 $44,043 $24,813 $596,110 $596,110 $204,881 $84,778 $21,195 $197,816 $6,330 $45,145 $25,434 $585,579 $585,579 $210,003 $86,898 $21,724 $202,762 $6,488 $46,273 $26,069 $600,218 $600,218 $215,253 $89,070 $22,268 $207,831 $6,651 $47,430 $26,721 $615,224 $615,224 $220,635 $91,297 $22,824 $30,432 $213,027 $6,817 $48,616 $27,389 $661,037 $494,526 $1,027,092 $228,243 $1,749,861 $2,410,898 $226,151 $93,580 $23,395 $28,074 $218,352 $6,987 $49,831 $28,074 $674,443 $674,443 $231,804 $95,919 $23,980 $223,811 $7,162 $51,077 $28,776 $662,529 $662,529 $237,599 $98,317 $24,579 $229,406 $7,341 $52,354 $29,495 $679,092 $679,092 $243,539 $100,775 $25,194 $235,141 $7,525 $53,663 $30,232 $696,069 $696,069 $249,628 $103,294 $25,824 $34,431 $241,020 $7,713 $55,004 $30,988 $747,902 $258,236 $258,236 $1,006,138 $255,869 $105,877 $26,469 $31,763 $247,045 $7,905 $56,379 $31,763 $763,071 $763,071 $262,265 $108,524 $27,131 $253,222 $8,103 $57,789 $32,557 $749,590 $749,590 $268,822 $111,237 $27,809 $259,552 $8,306 $59,234 $33,371 $768,330 $768,330 $275,542 $114,018 $28,504 $266,041 $8,513 $60,714 $34,205 $787,538 $787,538 $282,431 $116,868 $29,217 $38,956 $272,692 $8,726 $62,232 $35,060 $846,183 $1,314,765 $292,170 $1,606,935 $2,453,118 $289,492 $119,790 $29,947 $35,937 $279,509 $8,944 $63,788 $35,937 $863,344 $863,344 $296,729 $122,784 $30,696 $286,497 $9,168 $65,383 $36,835 $848,093 $848,093 $304,147 $125,854 $31,464 $293,659 $9,397 $67,017 $37,756 $869,295 $869,295 $311,751 $129,000 $32,250 $301,001 $9,632 $68,693 $38,700 $891,027 $891,027 $319,545 $132,225 $33,056 $44,075 $308,526 $9,873 $70,410 $39,668 $957,378 $957,378 $24,502,065 Commonwealth Associates, Inc. Page 21 efigincers -cansuliants. construction managers Table 2 Projected Annual O&M and Catastrophic Failures Costs Inflated Dollars — 2.5% Annual Inflation Wrangell — Petersburg Load Resource Balance Wrangell Load Forecast Three load growth cases were developed for Wrangell, a base case, a high-growth case and a low-growth case. In consultation with Wrangell representatives, the following average annual rates of growth were assumed for the three load forecasts. Table 3 Wrangell Load Forecast Average Annual Rates of Growth Average Annual Forecast Case _ Rate of Growth Base Case 0.00% High Case 1.50% Low Case -1.50% Losses of 5% were added to this load forecast to arrive at a forecast of requirements at the generation level. Chart 1 Wrangell Requirements Forecast 45,000,000 40,000,000 = . High Case = 1.50% average annual growth 35,000,000 a Base Case = 0.00% average annual growth 30,000,000 — i 25,000,000 | $—-6 ee ee ee ee ee 5 20,000,000 15,000,000 Low Case = -1.50% average annual growth 10,000,000 5,000,000 o SSeS e€SeeesSeeceers ans ss sssseReae222 28 & 2 RRR RRRERRRERRRRRRERRRRRRRRRRRRR RRR RR J] Commonweaith Associates, Inc. Page 22 eagioe ers -Comstliasts comer uetion managers Electric Heat Conversions A brief analysis was conducted of the potential conversions of Wrangell oil heated buildings to electric heat. It is expected that governmental buildings would be converted first. Oil heated homes would be likely to follow. It was estimated that approximately 30% of the homes eligible to convert would actually follow through and switch to electric heat. CAI did not make a specific estimate of the impact of the conversion of governmental buildings to electric heat. However, CAI expects that both the increased load of any converted governmental buildings as well as electrically heated homes would fit within the range of the high case forecast. Therefore, no additional changes to the forecast were made and it was concluded that the high forecast adequately represented the potential impact of electric heat conversions. The load resulting from electric heat conversions may be served as interruptible load. If so, this reduces the probability of the high load forecast being realized and increases the relative probability of the average forecast being realized. Generation Forecast Wrangell owns a small amount of diesel generation. After reviewing historical generation trends and discussions with Wrangell management, it was determined appropriate to assume 2,000 kWh of diesel generation each month of the forecast except June, when 600,000 kWh of diesel generation would be assumed. The remainder of Wrangell’s load was served with the output of the Tyee plant. Petersburg Load Forecast Three load growth cases were developed for Petersburg, a base case, a high-growth case and a low-growth case. In consultation with Petersburg management, the following average annual rates of growth were assumed for the three load forecasts. Table 4 Petersburg Load Forecast Average Annual Rates of Growth Average Annual Forecast Case _ Rate of Growth Base Case 0.00% High Case 2.00% Low Case -0.50% Losses of 8.85% were added to this load forecast to arrive at a forecast of requirements at the generation level. Cay Commonwealth Associates, Inc. Page 23 caine rs -comuhants -copstructiion managers Chart 2 Petersburg Requirements Forecast 190,000,000 ‘80,000,000 High Case = 2.00% average annual growth 70,000,000 60,000,000 [Base Case = 0.00% average annual growth 50,000,000 kWh 40,000,000 + 30,000,000 [Low Case = -0.50% average annual growth 20,000,000 10,000,000 0 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2008 2007 2008 2021 2022 2023 2024 2025 Electric Heat Conversions A brief analysis was conducted of the potential conversions of Petersburg oil heated buildings to electric heat. It is expected that governmental buildings would be converted first. Oil heated homes would be likely to follow. It was estimated that approximately 30% of the homes eligible to convert would actually follow through and switch to electric heat. CAI did not make a specific estimate of the impact of the conversion of governmental buildings to electric heat. However, CAI expects that both the increased load of any converted governmental buildings as well as electrically heated homes would fit within the range of the high case forecast. Therefore, no additional changes to the forecast were made and it was concluded that the high forecast adequately represented the potential impact of electric heat conversions. The load resulting from electric heat conversions may be served as interruptible load. If so, this reduces the probability of the high load forecast being realized and increases the relative probability of the average forecast being realized. Generation Forecast Petersburg receives the output of the Blind Slough Hydroelectric Project. CAI examined historical Blind Slough output from 1996 through 2004. Average annual generation during that period was 11,601,978 kWh and this amount was assumed as the annual generation in the forecast. This annual amount was split into months using the average monthly generation from the same period. Petersburg also owns some diesel generation. Historical diesel generation was examined for the 1996 through 2004 period. It was determined that the period 2002 — 2004 most accurately represented future diesel operation. Therefore, the average monthly diesel generation for the VAY Commonwealth Associates, Inc. Page 24 eaginee rs -consutasits scommeruction manayers period 2002 — 2004 was used for future years. The total assumed annual diesel generation was 879,461 kWh. The remaining Petersburg load, after applying Blind Slough and the assumed diesel generation, was served with the output of the Tyee plant. Wrangell and Petersburg Combined Load Forecast The next step in the analysis was to combine the Wrangell and Petersburg loads and generation. The following charts show the individual forecast cases for Wrangell and Petersburg as well as the combined forecasts. Chart 3 Wrangell and Petersburg Requirements Forecasts 90,000,000 80,000,000 Petersburg High, Base & Low Cases in Red 70,000,000 = 60,000,000 y <a 50,000,000 — Z = 40,000,000 | SSR — SESH HHH HIE HEHE rt oo 6-9 2-9 og \— 3a 30,000,000 + —— —a- ees Ss > — = «== = 20,000,000 + = sh — 10,000,000 0 8588 2E2 £322 E2828 55 SSKRRRRSESREESSEBEESB RRR RRR RRRRRRRRRRRRRRRRRRRR RRR RR ZB Chart 4 Combined Wrangell and Petersburg Requirements Forecasts 140,000,000 120,000,000 100,000,000 80,000,000 g 60,000,000 } 40,000,000 20,000,000 5e2@2e2r 89 2 t= bo Or eB eeoernneneeveenreesoera B6SBE2ES 2322858 2228 SKRBESBRBKEEBEBBSBB sssegagu5e 5S 85 SF FERS Ss FS SSS ss FS SF SEBS Ss S&S SR RKCRKRRKRRKCRRARKRAKRAKRRKRRAKCKRRARKRARAN 0 g Commonwealth Associates, Inc. engineers «consultants. construction managers CAy 2033 2034 2035 2036 2037 2038 Page 25 Generation Forecast The following charts show the Wrangell and Petersburg generation other than Tyee. Chart 5 Wrangell and Petersburg Generation 1,200,000 1,000,000 } 800,000 = 600,000 | 400,000 200,000 ° 3 : é 3 z g z z 3 3 5 : SLT Ae eee Fl 5 3 $ 3 8 @Wrangell Diesel @Ptrsbrg Diesel O Blind Slough Chart 6 Wrangell and Petersburg Combined Generation 2,500,000 2,000,000 1,500,000 + g 1,000,000 500,000 i 3 z 2 6 = 2 2 z BT TP TALL EE THEIL || fe 8 = 3 3 & |GWrangell Diesel @ Ptrsbrg Diesel O Blind Slough ] Ay Commonwealth Associates, Inc. Page 26 enginee -consulants «construction managers Tyee Modeling The Tyee project meets the remaining load of Wrangell and Petersburg after the use of their own resources. The goal of this modeling was to determine the energy remaining in the Tyee reservoir after serving the loads of Wrangell and Petersburg. Reports provided to CAI documented the Tyee reservoir capacity as 52,400 acre-feet. Historical monthly inflow data was taken from Tyee Design Criteria documents. Table 5 shows the monthly inflow data for the period 1952 through 1978. The model used this data to represent actual monthly historical flows into the Tyee project. The model assumed the reservoir was full at the beginning of the analysis and used an average head of 1233’. A preliminary end-of-month reservoir level was then estimated using the following formula: Beg. Reservoir Level + Inflows — Generation = Preliminary Ending Reservoir If the ending reservoir level was greater than 52,400 acre-feet, then spill was assumed to bring the reservoir down to 52,400. This provided an ending reservoir level, which became the beginning reservoir level for the next month. In order to make these calculations, inflows in cubic-feet per second had to be converted to kWh. The ending reservoir level and the required generation also had to be converted to acre-feet and kWh. The formulas that were used to make these conversions are explained in Appendix A. That appendix also shows the available energy at Tyee from inflows alone both before and after serving Wrangell — Petersburg. Later in the modeling, it was discovered that this methodology allowed the reservoir to be drawn down too rapidly and too deeply. There were cases where power transmitted over the STI drained the reservoir and there was not enough energy left at Tyee to serve Wrangell and Petersburg. This is not a realistic case, so additional constraints were added. The first constraint was a “look ahead" function. If Wrangell — Petersburg loads over the next four months were going to use all the inflows plus drain the reservoir, then exports were prohibited in the current month. The second constraint was a minimum reservoir level (greater than zero). This constraint was set such that power transmitted over STI never required the reservoir to be drawn down below a level that could generate 27,000,000 kWh. These two constraints worked together to ensure that other uses of Tyee power were never allowed to draw the reservoir down to such an extent that Wrangell — Petersburg loads could not be served by Tyee. Cay Commonwealth Associates, Inc. Page 27 eygiee rs eComstlusits «Conner uction manayer Water Year 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 Average Maximum Minimum Cay Commonwealth Associates, Inc. engineer -cansnluants . construction manasers Oct 150 325 361 242 198 192 176 475 348 483 $98 251 293 295 383 195 239 196 148 229 179 151 167 510 158 242 277 275 598 148 From Exhibit 1.2-5 of Tyee Lake Contract 2145 Design Criteria Nov 71 114 101 198 34 132 155 113 112 w 98 157 26 91 52 110 133 108 322 138 83 73 4 101 55 162 15 113 322 4 Dec Jan 55 22 44 25 66 28 WI $1 29 18 133031 5587 84 34 186 «56 104 62 33° «168 218 «127 96 54 66 4 42 21 42-30 46 (26 32 1 102 28 $1 34 3924 3148 92 25 42 31 7 7 126 43 4 (29 % 47 218 168 29 W Feb Mar 14 8 16 21 22 16 30 21 11 W 14 - 13 22 24 20 25 33 34 53 37 43 49 101 30 40 22 37 34 1S 38 21 16 41 81 10 9 47 36 3 13 41 54 20 19 49 23 1S 18 39 36 87 28 28 26 36 28 2 81 10 9 Table 5 Tyee Lake Inflows (CFS) Ape 58 $3 14 39 48 42 77 55 88 87 85 49 45 64 63 19 36 60 41 33 22 45 64 26 98 86 62 $3 88 14 May = June 215 321 303 338 138 329 129 328 338 277 236 371 249 327 214 376 205 324 196 371 178 365 181 306 134 420 1358 340 188 352 240 464 218 298 253 400 156 414 162 362 22738 198 327 157 293 113 2u1 201 349 126 451 123 268 193 350 338 4b 113 268 July Aug Sep 338 244 261 301 273 268 207 395 338 276 301 245 320 294 289 287 273 268 282 263 414 262 320 414 367 195 188 293 414 188 260 170 156 345 350 188 256 225 276 285 240 96 287 148 244 221 166 224 276 269 328 277 258 235 294 178 215 238 350 96 279 230 167 231 150 198 124 177 214 209 266 256 WW 97 281 363 392 140 270 176 218 234 257 192 290 189 133 218 392 97 Average 151 158 147 170 181 150 147 184 186 188 204 168 163 141 165 168 163 143 177 146 169 143 146 167 168 187 122 161 204 122 Page 28 The model went through monthly calculations using the above formula. For each month, the beginning reservoir was estimated, inflows were added, generation and spill was subtracted and an ending reservoir level was calculated. Chart 7 End of Month Tyee Reservoir Level Converted to kWh After Serving Wrangell — Petersburg, Before Any Other Uses Base-Case Loads, Historical Flows 70,000,000 60,000,000 40,000,000 10,000,000 ° 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2034 2035 2036 2037 2038 2027 2028 2029 2030 2031 2032 2033 8 2010 g The above chart shows that there is plenty of energy left in the Tyee reservoir given the above assumptions. The reservoir never goes above 58 million kWh because above that spill will occur bringing the reservoir back down to the 58 million kWh level. Cay Commonwealth Associates, Inc. Page 29 engineers -commbants -construcion managers Chart 8 End of Month Tyee Reservoir Level Converted to kWh After Serving Wrangell — Petersburg, Before Any Other Uses Low-Case Loads, Historical Flows fone z 30,000,000 20,000,000 10,000,000 7 SEE SDSS Sa ao eae oe aa ge e882 88 88 88 8 8 8 888 88 22228 2 8 Be Chart 9 End of Month Tyee Reservoir Level Converted to kWh After Serving Wrangell — Petersburg, Before Any Other Uses High-Case Loads, Historical Flows 70,000,000 {60,000,000 Cay Commonwealth Associates, Inc. Page 30 SHINee -CoMMEManEs contruction managers Ketchikan Public Utilities Load Resource Balance Load Forecast Four load growth cases were developed for Ketchikan. First, a base case, high case and low case were developed using the following growth rates: Table 6 Ketchikan Load Forecast Average Annual Rates of Growth Average Annual Forecast Case _ Rate of Growth Base Case 0.80% High Case 2.00% Low Case 0.25% CAI was additionally asked to evaluate the potential impact of serving the load of cruise ships that dock at Ketchikan. After consulting with Ketchikan management as well as management at Juneau, it was determined that large ships would require 11 MW each and small ships would require 6 MW each. The Ketchikan piers can accommodate up to three large ships, however CAI was advised to assume that only one ship is being served at any time. Consequently, this analysis assumes | large ship would be in port taking 11 MW for 8 hours a day between May 5 and October 5 each year. Table 7 calculates the additional load that would be experienced based upon these assumptions. Table 7 Estimated Cruise Ship Load Hours Monthly Month | MW_Days_Per Day kWh May 11 26 8 2,288,000 June 11 30 8 2,640,000 July 11 31 8 2,728,000 August 11 31 8 2,728,000 September 11 30 8 2,640,000 October 11 =) 8 440,000 13,464,000 This additional cruise ship load was added to the Ketchikan high case to create a fourth load forecast case, referred to as the “Extra-High Case.” It should be noted that significant infrastructure work might be required within the Ketchikan system to serve these loads. The cost of that work has not been considered in this analysis. Cay Commonwealth Associates, Inc. Page 31 cagincer -comsubants - construction managers The additional cruise ship load was not added to the other load forecast cases (base and low). If the cruise ship load occurred when other loads were running at base case or low case levels, the result would be that total load would correspond roughly to the high case. In other words, the high case forecast would represent the addition of cruise ship loads to the base or low case forecast. This study assumes the additional cruise ship load will be served at interruptible rates. Losses of 6.0% were added to the load forecast to develop a requirements forecast for Ketchikan. The following chart shows the four forecast cases. Chart 10 Ketchikan Requirements Forecast Cases Annual kWh 350,000,000 300,000,000 — 250,000,000 200,000,000 aa g 150,000,000 100,000,000 50,000,000 2006 2023 2024 2025 2026 2027 2028 2029 2030 2007 2008 2031 2032 2033 2034 2035 2036 2037 2038 —#— Extra High —@—High —™-—Base —tr—Low Electric Heat Load As was the case in Wrangell — Petersburg, it was determined that the loads associated with any conversions to electric heat was adequately represented in the high and extra-high case forecasts. Again, if this load is served with interruptible rates the probability of the high or extra-high case is reduced and likely results are moved toward the average cases. Generation Forecast Ketchikan Public Utilities (*“KPU”) owns three hydroelectric projects: Ketchikan, Beaver Falls and Silvis. KPU is considering upgrades to these projects that will increase their output. Additionally, Ketchikan may construct a new hydro project. This study’s base case uses the output of the existing plants without the upgrades and does not include the output of any Cay Commonwealth Associates, Inc. Page 32 engineers -consulnants «construction managers new hydro projects. Upgrades to KPU’s existing projects or the construction of new projects may affect the outcome of this study depending on where the project output is placed in the dispatch order. Table 8 shows the expected generation of each plant under minimum, average and maximum inflows as used in this study. Table 8 Expected Annual Kilowatt-hour Generation Ketchikan Hydroelectric Projects Reflects No Increases Due To Upgrades and Modifications Ketchikan Beaver Falls Silvis Total Min. Inflows 14,957,600 33,017,000 9,595,100 57,569,700 Avg. Inflows 20,049,884 38,718,222 11,510,513 70,278,619 Max. Inflows 24,421,000 44,273,400 14,034,100 82,728,500 To arrive at generation under minimum inflows, the lowest annual generation during 1990 — 2005 was used. Maximum generation was based upon the highest annual generation during that period. Average annual generation was determined by first averaging all the January months, then averaging all the February months, etc through December. Then the 12 individual monthly averages were summed to arrive at the annual average generation. Ketchikan also owns approximately 23 MW of diesel generation that is operated as required. The dispatch order used to serve Ketchikan’s load is first to use their hydro projects, then to use the output of Swan Lake as necessary and lastly to fill in with diesel generation as required. The modeling reflects this dispatch order. Swan Lake Modeling Historical flow data was difficult to find for Swan Lake. CAI was unable to find any data that showed actual inflows to the project. It was possible, however, to derive inflows from some of the project reports. These reports were available for 1997 through 2004. Additionally, rainfall data was available for 1991 — 2004. Using regression analysis, a statistical relationship was defined between rainfall and inflows using the rainfall data and derived inflow data for 1997 — 2004. That relationship was then used to forecast inflows for 1991 — 1996 based on the available rainfall data. Table 9 below shows rainfall data for Ketchikan. VAY Commonwealth Associates, Inc. Page 33 engineers scunsultants scopstrucdon managers Table 9 Annual Rainfall in Inches Ketchikan, Alaska Year Rainfall 1991 151.0 1992 138.5 1993 119.7 1994 114.1 1995 107.6 1996 116.0 1997 164.8 1998 137.8 1999 204.9 2000 188.7 2001 189.1 2002 166.3 2003 185.2 2004 166.0 Average= 153.6 Table 9 demonstrates the significant variability in annual rainfall. The average annual rainfall for 1991 — 1996 is 124.5 inches. Compare that to the average for 1997 through 2004, which is 175.4. Individual years varied during this period from 107.6 inches in 1995 to nearly double that amount 204.9 inches in 1999. The high variability in rainfall leads to high variability in hydro output. Hydro output directly affects the economics of the STI. Table 10 shows the derived and forecast inflow data for Swan Lake. Table 10 Derived and Forecast Swan Inflow Data Acre-Feet Jan Feb Mar May Jun Jul Au: Oct Nov Dec Total 1991 22,516 10,474 14,542 20,598 32,517 28,684 18,977 20,933 31,632 31,857 21,363 25,362 279,457 1992 21,007 9,772 13,568 19,218 30,338 26,762 17,706 19,530 29,512 29,722 19,931 23,663 260,729 1993 18,738 8,716 12,102 17,142 27,060 23,871 15,793 17,420 26,324 26,511 17,778 21,106 232,561 Forecast 1994 18,062 8.402 11,665 16,523 26,084 23,009 15,223 16,792 25,374 25,555 17,137 20,345 224,171 | 1995 17,277 8,037 11,159 15,805 24,951 22,010 14,562 16,062 24,272 24,445 16,392 19,461 214,432 1996 18,291 8,509 11,814 16,733 26,415 23,302 15,416 17,005 25,696 _25,879 _17,354 20,603 227,017 1997 25,456 25,966 14,131 34,802 34,244 33,118 23,665 17,714 26,051 33,894 17,610 52,855 339,506 | 1998 12,464 14,824 7,140 16,431 20,159 13,607 6,247 34,120 23,899 37,612 9,849 17,626 213,978 1999 23,804 8,593 19,919 22,095 57,602 44,888 27,515 24,124 23,912 43,900 27,674 22,004 346,030 2000 8,952 4,986 22,556 23,530 40,006 36,321 37,664 33,272 35,502 22,357 26,303 13,294 304,743 Derived 2001 31,107 =9,467-11,310 20,282 33,747 41,933 29,986 28,217 57,067 29,590 28,914 20,026 341,646 2002 17,425 8,086 16,441 23,287 49,031 45,276 25,743 35,163 38,357 36,016 24,152 28,673 347,651 2003 42,621 7,061 20,111 18,700 33,629 26,473 12,043 13,116 50,086 44,080 21,094 35,795 324,809 2004 41,816 15,748 19,919 27,172 25,678 17,814 _8,777__3,602 _ 31,220 40,680 _ 37,618 39,114 _ 309,158 Commonwealth Associates, Inc. Page 34 ehgineers -Consultanty -comstruction managers It was assumed that the Swan reservoir maximum capacity was 126,170 acre-feet. The model followed the dispatch order described earlier; first using Ketchikan’s own hydro projects, then Swan Lake to the extent it was available and required, and lastly relying on diesel to serve remaining load. In each case, the model calculated the KPU hydro generation assuming average inflows. The model calculated the Swan Lake generation in the same manner as the Tyee generation was calculated. The Swan Lake inflows in Table 10 were considered one cycle of flows. These flows were used and the cycle was repeated through the life of the model. The following Chart 11 shows the estimated generation of the KPU Hydro, Swan Lake and the diesel generation assuming historical flows and base case load growth. Chart 11 Ketchikan Monthly Generation Base Load Forecast — Historical Inflows 35,000,000 30,000,000 25,000,000 — 20,000,000 kWh 15,000,000 10,000,000 5,000,000 GKPU Hydro O Swan @ Diesel Chart 11 shows there is some diesel required in almost all years and significant diesel required in some years. There are years in the historical inflow cycle where inflows are low. This will reduce available generation from Swan Lake and increase the need for diesel. This is reflected in the above chart as years where there is lots of purple diesel generation being shown. Chart 12 below shows the situation when Ketchikan Loads match the low-case load forecast. Cay Commonwealth Associates, Inc. Page 35 ehgipce rs -comsultasits construction managers Chart 12 Ketchikan Monthly Generation Low Load Forecast — Historical Inflows 35,000,000 25,000,000 20,000,000 15,000,000 10,000,000 5,000,000 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 pe @KPU Hydro O Swan @ Diesel | In Chart 12, it is clear that lower loads have reduced the need for diesel generation. Chart 13, below, shows historical inflows and the high case forecast. Significantly, more diesel generation is needed to meet the higher loads. Chart 13 Ketchikan Monthly Generation High Case Forecast — Historical Inflows 35,000,000 g 8 |KPU Hydro OSwan @ Diesel Cay Commonwealth Associates, Inc, Page 36 eae ers -CoMMMMAEES Constr uetiOn manaper Lastly, Chart 14 shows the generation assuming the extra-high load forecast and historical flows. Chart 14 Ketchikan Monthly Generation Extra-High Case Forecast — Historical Inflows ‘35,000,000 @KPU Hydro O Swan @ Diesel The above charts demonstrate how the generation mix varies based upon the Ketchikan loads. The key thing to focus on in these charts is the amount of diesel generation. Diesel generation in Ketchikan can be displaced with Tyee power transported over the STI; therefore, more diesel generation in Ketchikan is good for the economics of the STI. The greater the diesel generation in Ketchikan, the better the economics for the STI. As the above charts show, there is some diesel generation required in all load growth cases. Recall that the Tyee modeling summarized in Chart 7 showed there was energy left in the Tyee reservoir after serving Wrangell — Petersburg. Diesel generation in Ketchikan and available energy at Tyee means: (1) there is a need for power to displace diesel generation in Ketchikan, and, (2) there is power to meet that load in Tyee. This creates the potential for positive economics for the Swan — Tyee Intertie. The next section of this report will evaluate whether or not exports from Tyee to Ketchikan will be sufficient to cover the annual operating costs of the Swan — Tyee Intertie. Cay Commonwealth Associates, Inc. Page 37 engineer econsuliants -comstruction managers Swan — Tyee Intertie Economic Model Results Methodology and Assumptions The first step in the model was to evaluate the amount of energy available at Tyee after serving the Wrangell — Petersburg loads. The results of that evaluation are shown in Charts 7 — 9 earlier in this report. Next, the model calculated the diesel generation required at Ketchikan. Those results are shown in Charts 11 — 14. The model then asked the question, “Is there sufficient energy at Tyee to displace some or all of the Ketchikan diesel generation?” Available energy from Tyee was transported across the STI to Ketchikan. The STI capacity was limited to 16 MW, based upon previous power flow studies conducted by engineering consultants. Transmission losses were calculated at 2.1%. Power sent to Ketchikan was additionally limited such that power sent to Ketchikan would not force Wrangell — Petersburg to run their diesel generation to support Ketchikan. Note that FDPPA receives revenue for power delivered to Ketchikan, not additional power generated at Tyee. This means FDPPA absorbs the cost of losses on the transmission. There were six primary cases developed, a base case and five sensitivities. Table 11 below shows the key assumptions in these cases. The highlighted cells in the table show the assumptions that vary from the base case. Sensitivities 1 — 3 vary the FDPPA rates that are charged for power flowing over the STI. Sensitivity #4 tests the impact of debt service and Sensitivity #5 tests the impact of upgrades to the Ketchikan hydro projects. VAT Commonwealth Associates, Inc. Page 38 engineer -comstltanits scomtruction managers Table 11 Case Assumptions Sensitivity Sensitivity Sensitivity Sensitivity Sensitivity Base Case av #2° #3° #4 #5° Loads All 4 cases All 4 cases All 4 cases All 4 cases All 4 cases All 4 cases Inflows Historical Historical Historical Historical Historical Historical FDPPA Starting | $0.064/ | $0.064 / $0.064 / Rate: $0.04 $0.04 $0.04 Firm/Interruptible Rate Inflation: Firm/Interruptible | 3 yrs / same $0.001 every 3 yrs / same $0.001 every $0.001 every | $0.001 every 3 yrs / same 3 yrs / same Debt Zero Zero Zero eee | Intertie Capacity [16 MW | 16 MW 16 MW. 16 MW 16 MW Losses 2.1% [ 2.1% 2.1% 2.1% 2.1% 2.1% KPU Generation No upgrades | Noupgrades | Noupgrades | Noupgrades | No upgrades Footnotes: 1 2. 3; “All 4 cases” refers to in Ketchikan, the low, base, high and extra-high cases; in Wrangell — Petersburg, the low, base and high cases. Sensitivity #1 modeled an FDPPA firm rate that started at $0.068 and did not increase and a non-firm rate that started at $0.04 and increased $0.001 every 3 years. Sensitivity #2 modeled an FDPPA firm rate that started at $0.068 and a non-firm rate that started at $0.04, both of which increased $0.001 every 3 years. Sensitivity #3 used FDPPA firm rates that were developed in an earlier report by A. Dashen & Associates and extended for the number of years required for this study using the same methodology as Dashen used. Non- firm rates for this sensitivity started at $0.04 and increased $0.001 every 3 years. Sensitivity #4 put the FDPPA rates back to where they were in the base case but included the debt service on $10 million of borrowing at 5.5% for 20 years. This amounted to debt service costs of roughly $782,000 per year. Sensitivity #5 assumed that Ketchikan added 14 GWH of upgrades to their hydro projects and that this additional output was used before FDPPA power. The individual rate assumptions for each case are shown below in Table XX. Cay Commonwealth Associates, Inc. Page 39 eagmeers -consuiLanes «construction managers Table 12 Rate Assumptions for Each Case Base Case, Sensitivity #4, Year Sensitivity #5 Sensitivity #1 Sensitivity #2 Sensitivity #3 2009] $0.064 2010] $0.064 2011] $0.064 2012| $0.065 2013] $0.065 2014] $0.065 2015] $0.066 2016] $0.066 2017] $0.066 2018] $0.067 2019] $0.067 2020] $0.067 2021] $0.068 2022| $0.068 2023] $0.068 2024] $0.069 2025] $0.069 2026] $0.069 2027| $0.070 2028] $0.070 2029] $0.070 2030] $0.071 2031] $0.071 2032| $0.071 2033] $0.072 2034] $0.072 2035] $0.072 2036] $0.073 2037| $0.073 2038] $0.073 The model then calculated the net cash flows for each year considering the annual O&M expenses, catastrophic expenses and the revenue from transmission. These annual cash flows were calculated for each case. After determining the annual net revenues for each case, the net present value was calculated. A discount rate of 5.5% was used to calculate the net present value. Model Results Appendix B shows the net revenue results and net present values for all cases. Here in the body of the report, each case will be reviewed individually. Cay Commonwealth Associates, Inc. Page 40 engiee rs -ConsulLis + construe tion managers Base Case Tables 13 and 14 show the net revenue and net present value results for the base case. Table 13 Nominal Net Revenues — Historical Flows Base Case Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist Base/Hist $43,474,523 $22,643,807 $47,770,936 High/Hist $91,946,588 $47,293,323 $103,325,046 Xhigh/Hist $100,252,959 $53,272,529 $114,177,800 Low/Hist $10,529,541 $10,529,541 $11,610,536 KPU Case Table 14 Net Present Values of Net Revenues — Historical Flows Base Case Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist Base/Hist $15,248,168 $10,080,731 $16,435,511 High/Hist $33,991,722 $21,799,808 $37,043,294 Xhigh/Hist $38,821,737 $25,720,483 $42,753,763 Low/Hist $4,257,705 $4,257,705 $4,578,404 KPU Case Looking at the first column of Table 13 above, where the Wrangell — Petersburg Load/Generation is Base/Hist, it can be seen that the revenues vary in line with the KPU load. The higher the load, the higher the revenue to the STI. This makes sense since greater load in Ketchikan means greater diesel generation, greater exports from Tyee over the STI and higher revenues to FDPPA. Moving to the right in the table, the revenues are lower, when the Wrangell — Petersburg loads are higher. This is because the higher Wrangell — Petersburg loads use more of the Tyee power and there is less available to be transported to Ketchikan to displace diesel generation. In the right hand column, when loads are low, revenues rise because there is more Tyee power available to be transported to Ketchikan. Table 15 shows the detailed results when both Wrangell — Petersburg and KPU loads are at base load growth levels. Table 16 shows the detailed results when Wrangell — Petersburg loads are at base levels but KPU loads are at low levels. Cay Commonwealth Associates, Inc. Page 41 engineers scunsultasits -copséruetion managers Table 15 Detailed Case Results Base Case Assumptions — Historical Flows 'W/P=Base/Hist, KPU=Base/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year WIP <<K W/P >>K W/P >> K WP >>K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 31,488,133 31,488,133 0 $0.064 $0.040 $2,015,241 $2,015,241 $0 $462,449 $1,552,791 2010 0 30,607,948 30,607,948 0 $0.064 $0.040 $1,958,909 $1,958,909 $0 $288,570 $1,670,339 2011 0 33,322,890 33,322,890 0 $0.064 $0.040 $2,132,665 $2,132,665 $0 $454,181 $1,678,484 2012 0 11,399,531 11,399,531 0 $0.065 $0.041 $740,969 $740,969 $0 $465,536 $275,434 2013 0 32,824,223 32,824,223 0 $0.065 $0.041 $2,133,574 $2,133,574 $0 $1,481,614 $651,961 2014 0 14,800,902 14,800,902 0 $0.065 $0.041 $962,059 $962,059 $0 $511,035 $451,024 2015 0 10,018,617 10,018,617 0 $0.066 $0.042 $661,229 $661,229 $0 $501,331 $159,898 2016 0 15,276,592 15,276,592 0 $0.066 $0.042 $1,008,255 $1,008,255 $0 $530,505 $477,750 2017 0 11,905,300 11,905,300 0 $0.066 $0.042 $785,750 $785,750 $0 $543,768 $241,982 2018 0 14,705,970 14,705,970 0 $0.067 $0.043 $985,300 $985,300 $0 $785,993 $199,307 2019 0 22,861,780 22,861,780 0 $0.067 $0.043 $1,531,739 $1,531,739 $0 $596,110 $935,630 2020 0 23,865,983 23,865,983 0 $0.067 $0.043 $1,599,021 $1,599,021 $0 $585,579 $1,013,442 2021 0 33,688,231 33,688,231 0 $0.068 $0.044 $2,290,800 $2,290,800 $0 $600,218 $1,690,581 2022 0 44,014,141 44,014,141 0 $0.068 $0.044 $2,992,962 $2,992,962 $0 $615,224 $2,377,738 2023 0 39,146,057 39,146,057 0 $0.068 $0.044 $2,661,932 $2,661,932 $0 $2,410,898 $251,034 2024 0 50,012,004 50,012,004 0 $0.069 $0.045 $3,450,828 $3,450,828 $0 $674,443 $2,776,385 2025 0 42,938,156 42,938,156 0 $0.069 $0.045 $2,962,733 $2,962,733 $0 $662,529 $2,300,204 2026 0 28,465,580 28,465,580 0 $0.069 $0.045 $1,964,125 $1,964,125 $0 $679,092 $1,285,033 2027 0 47,849,864 47,849,864 0 $0.070 $0.046 $3,349,490 $3,349,490 $0 $696,069 $2,653,421 2028 0 16,733,848 16,733,848 0 $0.070 $0.046 $1,171,369 $1,171,369 $0 $1,006,138 $165,231 2029 0 29,858,230 29,858,230 0 $0.070 $0.046 $2,090,076 $2,090,076 $0 $763,071 $1,327,005 2030 0 24,912,147 24,912,147 0 $0.071 $0.047 $1,768,762 $1,768,762 $0 $749,590 $1,019,172 2031 0 29,639,460 29,639,460 0 $0.071 $0.047 $2,104,402 $2,104,402 $0 $768,330 $1,336,072 2032 0 32,905,974 32,905,974 0 $0.071 $0.047 $2,336,324 $2,336,324 $0 $787,538 $1,548,786 2033 0 45,110,207 45,110,207 0 $0.072 $0.048 $3,247,935 $3,247,935 $0 $2,453,118 $794,817 2034 0 44,120,100 44,120,100 0 $0.072 $0.048 $3,176,647 $3,176,647 $0 $863,344 $2,313,303 2035 0 50,906,401 50,906,401 0 $0.072 $0.048 $3,665,261 $3,665,261 $0 $848,093 $2,817,168 2036 0 56,976,659 56,976,659 0 $0.073 $0.049 $4,159,296 $4,159,296 $0 $869,295 $3,290,001 2037 0 $2,045,917 52,045,917 0 $0.073 $0.049 $3,799,352 $3,799,352 $0 $891,027 $2,908,325 2038 0 58,487,443 58,487,443 0 $0.073 $0.049 $4,269,583 $4,269,583 $0 $957,378 $3,312,205 Nominal Values 980,888,289 980,888,289 0 $67,976,588 $67,976,588 $0 $24,502,065 $43,474,523 Net Present Value $24,378,634 $24,378,634 $0 $9,130,465 $15,248,168 Cay Commonwealth Associates, Inc. Page 42 engineer -cunstliants «construction managers Table 16 Detailed Case Results Base Case Assumptions — Historical Flows W/P=Base/Hist, KPU=Low/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year W/P <<K W/P >> K W/P >> K W/P >> K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 26,282,440 26,282,440 0 $0.064 $0.040 $1,682,076 $1,682,076 $0 $462,449 $1,219,627 2010 0 26,706,110 26,706,110 0 $0.064 $0.040 $1,709,191 $1,709,191 $0 $288,570 $1,420,621 2011 0 26,308,702 26,308,702 0 $0.064 $0.040 $1,683,757 $1,683,757 $0 $454,181 $1,229,576 2012 0 5,773,513 5,773,513 0 $0.065 $0.041 $375,278 $375,278 $0 $465,536 ($90,257) 2013 0 21,657,343 21,657,343 0 $0.065 $0.041 $1,407,727 $1,407,727 $0 $1,481,614 ($73,886) 2014 0 11,376,196 11,376,196 0 $0.065 $0.041 $739,453 $739,453 $0 $511,035 $228,418 2015 0 0 0 0 $0.066 $0.042 $0 $0 $0 $501,331 ($501,331) 2016 0 4,087,031 4,087,031 0 $0.066 $0.042 $269,744 $269,744 $0 $530,505 ($260,761) 2017 0 0 0 0 $0.066 $0.042 $0 $0 $0 $543,768 ($543,768) 2018 0 0 0 0 $0.067 $0.043 $0 $0 $0 $785,993 ($785,993) 2019 0 4,492,304 4,492,304 0 $0.067 $0.043 $300,984 $300,984 $0 $596,110 ($295,125) 2020 0 5,578,802 5,578,802 0 $0.067 $0.043 $373,780 $373,780 $0 $585,579 ($211,799) 2021 0 20,418,852 20,418,852 0 $0.068 $0.044 $1,388,482 $1,388,482 $0 $600,218 $788,264 2022 0 29,204,546 29,204,546 0 $0.068 $0.044 $1,985,909 $1,985,909 $0 $615,224 $1,370,685 2023 0 28,188,242 28,188,242 0 $0.068 $0.044 $1,916,800 $1,916,800 $0 $2,410,898 ($494,097) 2024 0 34,817,151 34,817,151 0 $0.069 $0.045 $2,402,383 $2,402,383 $0 $674,443 $1,727,940 2025 0 29,146,607 29,146,607 0 $0.069 $0.045 $2,011,116 $2,011,116 $0 $662,529 $1,348,587 2026 0 9,630,158 9,630,158 0 $0.069 $0.045 $664,481 $664,481 $0 $679,092 ($14,611) 2027 0 28,996,466 28,996,466 0 $0.070 $0.046 $2,029,753 $2,029,753 $0 $696,069 $1,333,684 2028 0 13,340,212 13,340,212 0 $0.070 $0.046 $933,815 $933,815 $0 $1,006,138 ($72,323) 2029 0 5,513,572 5,513,572 0 $0.070 $0.046 $385,950 $385,950 $0 $763,071 ($377,121) 2030 0 9,835,108 9,835,108 0 $0.071 $0.047 $698,293 $698,293 $0 $749,590 ($51,298) 2031 0 5,517,634 5,517,634 0 $0.071 $0.047 $391,752 $391,752 $0 $768,330 ($376,578) 2032 0 4,822,824 4,822,824 0 $0.071 $0.047 $342,420 $342,420 $0 $787,538 ($445,118) 2033 0 13,460,481 13,460,481 0 $0.072 $0.048 $969,155 $969,155 $0 $2,453,118 ($1,483,963) 2034 0 11,756,117 11,756,117 0 $0.072 $0.048 $846,440 $846,440 $0 $863,344 ($16,904) 2035 0 27,053,611 27,053,611 0 $0.072 $0.048 $1,947,860 $1,947,860 $0 $848,093 $1,099,767 2036 0 33,634,084 33,634,084 0 $0.073 $0.049 $2,455,288 $2,455,288 $0 $869,295 $1,585,993 2037 0 33,127,102 33,127,102 0 $0.073 $0.049 $2,418,278 $2,418,278 $0 $891,027 $1,527,251 2038 0 37,006,023 37,006,023 0 $0.073 $0.049 $2,701,440 $2,701,440 $0 $957,378 $1,744,062 Nominal Values 507,731,229 507,731,229 0 $35,031,606 $35,031,606 $0 $24,502,065 $10,529,541 Net Present Value $13,388,170 $13,388,170 $0 $9,130,465 $4,257,705 “Ay Commonwealth Associates, Inc. Page 43 caginerrs «consultants. construction managers Table 15 shows that over the 30 years of the study, 980,888,289 kWh were transported across the STI from Tyee to Ketchikan. Note that these flows increased and decreased through time with the cycle of assumed inflows. When inflows were high, less power would flow over the STI as KPU had lower needs for diesel generation and power to displace that generation. When inflows were low, more power flowed over the line. Table 15 shows the results assuming base load growth in Ketchikan. In this case, there is no cruise ship load so there are no interruptible power deliveries. Cruise ship load only shows up in the extra-high load growth case. The table shows that FDPPA would receive almost $70 million of transmission revenue over the life of the study and this would more than cover the $24.5 million of annual expenses. The annual net revenues, in the right-hand column, range from a low of $159,898 to a high of $3.3 million. Table 16 shows the results when lower load growth is assumed in Ketchikan. Less power is delivered over the STI, only 507,731,229 kWh. Revenue over the study period is $35 million, yielding roughly $10.5 million in net revenue. This scenario demonstrates that even though many of the individual years have negative results, the results are positive over the life of the study. As explained earlier, these results are based on derived historical inflows. It is possible to run a sensitivity case to estimate what the results would be under extreme case inflows. Minimum and maximum inflows can be derived for both Tyee and Swan. The model can be run assuming that these extreme inflows repeat themselves every year of the study. Of course, it is highly unlikely that such flows would occur repeatedly in every year over 30 years. This does, however, allow the model to test the economic results in these extreme cases. Table 17 shows these results. Other than inflows, the base case assumptions explained earlier are used. The economics are still positive in nearly two-thirds of the cases. The negative cases are where Wrangell — Petersburg loads are high and inflows are at minimum levels. In this case, there is insufficient water in Tyee to serve both Wrangell — Petersburg and to export power to Ketchikan; therefore, exports are curtailed. Results are also negative if Ketchikan loads are low and inflows are high because Ketchikan doesn’t need much power in this case. Lastly, they are negative if Ketchikan loads are at base levels and inflows are at maximum levels for all 30 years. All other cases, 45 out of 72, are positive. These results demonstrate that given the assumptions made, the economics of the line are positive even under unrealistically extreme inflow conditions. Cay Commonwealth Associates, Inc. Page 44 engipcer scomsulants - construction managers Cay Table 17 Case Results — Extreme Flows Base Case Assumptions Nominal Net Revenue-Historic Flows Base/Avg Base/Max Base/Min High/Avg High/Max High/Min XHigh/Avg XHigh/Max XHigh/Min Low/Avg Low/Max Low/Min KPU Load/Generation W/P Load/Generation Base/Max $35,369,774 ($6,712,231) $112,668,153 $124,706,949 $89,875,093 $179,287,957 $133,808,543 $109,347,642 $188,395,106 ($5,325,945) ($24,502,065) $73,144,918 Base/Min High/Max High/Min Low/Max $6,019,892 $30,827,973 ($20,584,266) $35,623,761 ($11,670,241) ($7,949,936) ($24,502,065) ($6,712,231) $7,256,721 $100,363,465 ($20,500,870) $113,758,874 $7,493,962 $99,148,447 ($20,561,904) $128,741,213 $2,725,239 $69,507,605 ($22,668,295) $92,048,474 $7,472,100 $141,309,941 ($20,410,897) $186,615,755 $6,833,803 $105,862,813 ($20,856,710) $138,342,164 $4,151,242 $85,440,034 ($21,606,513) $112,130,090 $7,096,357 $147,816,449 ($20,569,419) $196,012,110 ($5,325,945) ($6,000,211) ($21,966,733) ($5,325,945) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) $6,731,995 $70,123,353 ($20,500,773) $73,351,231 Net Present Value of Net Revenues Base/Avg Base/Max Base/Min High/Avg High/Max High/Min XHigh/Avg XHigh/Max XHigh/Min Low/Avg Low/Max Low/Min s g £ oe S o Oo 3 s 3 = ~ a M Commonwealth Associates, Inc. engineers -consuluants -convtruction ananagers W/P Load/Generation Low/Min $23,260,873 ($8,509,293) $27,312,238 $27,433,037 $20,684,771 $27,405,570 $25,989,961 $21,982,085 $26,915,053 ($5,325,945) ($24,502,065) $26,061,485 Base/Max Base/Min High/Max High/Min Low/Max Low/Min $10,555,498 $2,989,597 $9,519,816 ($6,350,184) $10,601,159 $7,825,433 ($5,103,627) ($6,144,326) ($5,349,484) ($9,130,465) ($5,103,627) — ($5,453,224) $42,109,152 $4,369,920 $39,331,759 ($6,084,593) $42,352,025 $11,005,239 $40,410,183 $4,278,042 $34,038,658 = ($6,181,300) $41,396,519 $10,859,768 $23,759,545 $369,815 $19,224,706 ($8,058,301) $24,172,836 $5,606,626 $66,443,864 $4,449,276 $56,339,242 ($6,024,202) $68,352,985 $11,086,605 $45,123,457 $3,914,419 $37,763,818 ($6,377,091) $46,385,259 $10,070,216 $32,726,002 $2,047,134 $27,262,027 ($7,100,889) $33,266,903 $7,773,611 $70,999,768 $4,241,601 $59,995,263 ($6,143,292) $73,004,973 $10,839,873 ($2,867,458) ($2,867,458) ($3,007,429) ($7,584,839) — ($2,867,458) ($2,867,458) ($9,130,465) ($9,130,465) — ($9,130,465) — ($9,130,465) — ($9,130,465) — ($9,130,465) $29,156,839 $4,207,906 $28,510,053 ($6,096,993) $29,193,601 $10,489,190 Page 45 Sensitivity #1 In Sensitivity #1, the starting FDPPA rates are increased slightly compared to the base case, but there is no escalation. Consequently, the overall FDPPA rate is lower in this sensitivity than in the base case and the economic results are a little lower. Table 18 Nominal Net Revenues — Historical Flows Sensitivity #1 Assumptions All Load Growth Scenarios W/P Load/Gener: Base/Hist High/Hist Low/Hist Base/Hist $42,198,339 $22,323,484 $46,340,249 High/Hist $90,193,808 $47,245,627 $101,123,729 Xhigh/Hist $98,643,299 $53,316,003 $112,100,930 Low/Hist $10,023,659 $10,023,659 $11,068,266 KPU Case Table 19 Net Present Values of Net Revenues — Historical Flows Sensitivity #1 Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist Base/Hist $15,292,985 $10,313,225 $16,447,044 High/Hist $34,125,284 $22,270,930 $37,089,341 Xhigh/Hist $39,012,249 $26,234,524 $42,851,841 Low/Hist $4,378,290 $4,378,290 $4,695,012 KPU Case The detailed results of Table 20 and 21 also reflect economics that are slightly down from the base case. There are no significant changes in the extreme inflow cases shown in Table 22. Cay Commonwealth Associates, Inc. engineers sconsultants «construction managers Page 46 Table 20 Detailed Case Results Sensitivity #1 Assumptions — Historical Flows W/P=Base/Hist, KPU=Base/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year W/P <<K W/P >> K W/P >> K W/P >> K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 31,488,133 31,488,133 0 $0.068 $0.040 $2,141,193 $2,141,193 $0 $462,449 $1,678,744 2010 0 30,607,948 30,607,948 0 $0.068 $0.040 $2,081,340 —- $2,081,340 $0 $288,570 $1,792,771 2011 0 33,322,890 33,322,890 0 $0.068 $0.040 $2,265,957 $2,265,957 $0 $454,181 $1,811,775 2012 0 11,399,531 11,399,531 0 $0.068 $0.041 $775,168 $775,168 $0 $465,536 $309,632 2013 0 32,824,223 32,824,223 0 $0.068 $0.041 $2,232,047 $2,232,047 $0 $1,481,614 $750,434 2014 0 14,800,902 14,800,902 0 $0.068 $0.041 $1,006,461 $1,006,461 $0 $511,035 $495,427 2015 0 10,018,617 10,018,617 0 $0.068 $0.042 $681,266 $681,266 $0 $501,331 $179,935 2016 0 15,276,592 15,276,592 0 $0.068 $0.042 $1,038,808 $1,038,808 $0 $530,505 $508,303 2017 0 11,905,300 11,905,300 0 $0.068 $0.042 $809,560 $809,560 $0 $543,768 $265,792 2018 0 14,705,970 14,705,970 0 $0.068 $0.043 $1,000,006 $1,000,006 $0 $785,993 $214,013 2019 0 22,861,780 22,861,780 0 $0.068 $0.043 $1,554,601 $1,554,601 $0 $596,110 $958,492 2020 0 23,865,983 23,865,983 0 $0.068 $0.043 $1,622,887 $1,622,887 $0 $585,579 $1,037,308 2021 0 33,688,231 33,688,231 0 $0.068 $0.044 $2,290,800 $2,290,800 $0 $600,218 $1,690,581 2022 0 44,014,141 44,014,141 0 $0.068 $0.044 $2,992,962 $2,992,962 $0 $615,224 $2,377,738 2023 0 39,146,057 39,146,057 0 $0.068 $0.044 $2,661,932 $2,661,932 $0 $2,410,898 $251,034 2024 0 50,012,004 50,012,004 0 $0.068 $0.045 $3,400,816 $3,400,816 $0 $674,443 $2,726,373 2025 0 42,938,156 42,938,156 0 $0.068 $0.045 $2,919,795 $2,919,795 $0 $662,529 $2,257,266 2026 0 28,465,580 28,465,580 0 $0.068 $0.045 $1,935,659 $1,935,659 $0 $679,092 $1,256,568 2027 0 47,849,864 47,849,864 0 $0.068 $0.046 $3,253,791 $3,253,791 $0 $696,069 $2,557,722 2028 0 16,733,848 16,733,848 0 $0.068 $0.046 $1,137,902 $1,137,902 $0 $1,006,138 $131,764 2029 0 29,858,230 29,858,230 0 $0.068 $0.046 $2,030,360 $2,030,360 $0 $763,071 $1,267,289 2030 0 24,912,147 24,912,147 0 $0.068 $0.047 $1,694,026 $1,694,026 $0 $749,590 $944,436 2031 0 29,639,460 29,639,460 0 $0.068 $0.047 $2,015,483 $2,015,483 $0 $768,330 $1,247,153 2032 0 32,905,974 32,905,974 0 $0.068 $0.047 $2,237,606 $2,237,606 $0 $787,538 $1,450,068 2033 0 45,110,207 45,110,207 0 $0.068 $0.048 $3,067,494 $3,067,494 $0 $2,453,118 $614,376 2034 0 44,120,100 44,120,100 0 $0.068 $0.048 $3,000,167 $3,000,167 $0 $863,344 $2,136,822 2035 0 50,906,401 50,906,401 0 $0.068 $0.048 $3,461,635 $3,461,635 $0 $848,093 $2,613,543 2036 0 56,976,659 56,976,659 0 $0.068 $0.049 $3,874,413 $3,874,413 $0 $869,295 $3,005,118 2037 0 52,045,917 52,045,917 0 $0.068 $0.049 $3,539,122 $3,539,122 $0 $891,027 $2,648,095 2038 0 58,487,443 58,487,443 0 $0.068 $0.049 $3,977,146 $3,977,146 $0 $957,378 $3,019,768 Nominal Values 980,888,289 980,888,289 0 $66,700,404 $66,700,404 $0 $24,502,065 $42,198,339 Net Present Value $24,423,450 $24,423,450 $0 $9,130,465 $15,292,985 “Ay Commonwealth Associates, Inc. Page 47 eigincen sconsullants construction managers Table 21 Detailed Case Results Sensitivity #1 Assumptions — Historical Flows 'W/P=Base/Hist, KPU=Low/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year W/P <<K W/P >> K W/P >> K W/P >> K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 26,282,440 26,282,440 0 $0.068 $0.040 = $1,787,206 —- $1,787,206 $0 $462,449 $1,324,757 2010 0 = 26,706,110 26,706,110 0 $0.068 $0.040 $1,816,015 $1,816,015 $0 $288,570 $1,527,446 2011 0 — 26,308,702 . 26,308,702 0 $0.068 $0.040 $1,788,992 $1,788,992 $0 $454,181 $1,334,811 2012 0 5,773,513 5,773,513 0 $0.068 $0.041 $392,599 $392,599 $0 $465,536 ($72,937) 2013 0 = 21,657,343 = 21,657,343 0 $0.068 $0.041 $1,472,699 — $1,472,699 $0 $1,481,614 ($8,914) 2014 0 11,376,196 11,376,196 0 $0.068 $0.041 $773,581 $773,581 $0 $511,035 $262,547 2015 0 0 0 0 $0.068 $0.042 $0 $0 $0 $501,331 ($501,331) 2016 0 4,087,031 4,087,031 0 $0.068 $0.042 $277,918 $277,918 $0 $530,505 ($252,587) 2017 0 0 0 0 $0.068 $0.042 $0 $0 $0 $543,768 = ($543,768) 2018 0 0 0 0 $0.068 $0.043 $0 $0 $0 $785,993 ($785,993) 2019 0 4,492,304 4,492,304 0 $0.068 $0.043 $305,477 $305,477 $0 $596,110 ($290,633) 2020 0 5,578,802 5,578,802 0 $0.068 $0.043 $379,359 $379,359 $0 $585,579 ($206,220) 2021 0 20,418,852 20,418,852 0 $0.068 $0.044 — $1,388,482 —- $1,388,482 $0 $600,218 $788,264 2022 0 29,204,546 29,204,546 0 $0.068 $0.044 — $1,985,909 $1,985,909 $0 $615,224 $1,370,685 2023 O =. 28,188,242 28,188,242 0 $0.068 $0.044 — $1,916,800 —- $1,916,800 $0 $2,410,898 ($494,097) 2024 0 34,817,151 34,817,151 0 $0.068 $0.045 $2,367,566 — $2,367,566 $0 $674,443 $1,693,123 2025 0 29,146,607 —- 29,146,607 0 $0.068 $0.045 $1,981,969 $1,981,969 $0 $662,529 $1,319,441 2026 0 9,630,158 9,630,158 0 $0.068 $0.045 $654,851 $654,851 $0 $679,092 ($24,241) 2027 0 = 28,996,466 —- 28,996,466 0 $0.068 $0.046 = $1,971,760 —- $1,971,760 $0 $696,069 $1,275,691 2028 0 13,340,212 13,340,212 0 $0.068 $0.046 $907,134 $907,134 $0 $1,006,138 ($99,004) 2029 0 5,513,572 5,513,572 0 $0.068 $0.046 $374,923 $374,923 $0 $763,071 ($388,148) 2030 0 9,835,108 9,835,108 0 $0.068 $0.047 $668,787 $668,787 $0 $749,590 ($80,803) 2031 0 5,517,634 5,517,634 0 $0.068 $0.047 $375,199 $375,199 $0 = $768,330 = ($393,131) 2032 0 4,822,824 4,822,824 0 $0.068 $0.047 $327,952 $327,952 $0 $787,538 ($459,586) 2033 0 13,460,481 13,460,481 0 $0.068 $0.048 $915,313 $915,313 $0 $2,453,118 ($1,537,805) 2034 0 11,756,117 11,756,117 0 $0.068 $0.048 $799,416 $799,416 $0 $863,344 ($63,928) 2035 0 27,053,611 27,053,611 0 $0.068 $0.048 $1,839,646 $1,839,646 $0 $848,093 $991,553 2036 0 33,634,084 33,634,084 0 $0.068 $0.049 $2,287,118 $2,287,118 $0 $869,295 $1,417,823 2037 0 33,127,102 33,127,102 0 $0.068 $0.049 $2,252,643 $2,252,643 $0 $891,027 $1,361,616 2038 0 37,006,023 37,006,023 0 $0.068 $0.049 $2,516,410 — $2,516,410 $0 $957,378 $1,559,031 Nominal Values 507,731,229 507,731,229 0 $34,525,724 $34,525,724 $0 $24,502,065 $10,023,659 Net Present Value $13,508,755 $13,508,755 $0 $9,130,465 $4,378,290 VAY Commonwealth Associates, Inc. Page 48 cigineem -consuliants «construction managers Table 22 Case Results — Extreme Flows Sensitivity #1 Assumptions Nominal Net Revenue-Historic Flows W/P Load/Generation Base/Max Base/Min High/Max High/Min Low/Max Low/Min Base/Avg $33,891,497 $5,762,254 $29,578,873 ($20,373,724) $34,128,087 $22,404,438 Base/Max ($7,620,191) ($12,297,644) ($8,782,569) ($24,502,065) ($7,620,191) ($9,305,502) § Base/Min $110,690,105 $7,134,308 $99,027,420 ($20,264,375) $111,723,382 $26,712,575 ® High/Avg $121,186,406 $7,342,197 $96,767,581 ($20,331,029) $125,032,458 $26,806,623 2 |High/Max $85,994,108 $2,231,696 $66,698,690 ($22,602,095) $88,027,384 $19,613,074 3 High/Min $176,316,204 $7,342,197 $139,837,364 ($20,171,676) $183,341,020 $26,806,623 3 XHigh/Avg $130,315,349 $6,616,552 $103,512,212 ($20,674,970) $134,661,363 $25,228,755 3 XHigh/Max $105,713,507 $3,796,239 $82,893,093 ($21,492,351) $108,352,894 $21,256,036 2 XHigh/Min $185,439,891 $6,943,551 $146,365,967 ($20,355,304) $192,754,545 $26,304,921 4 Low/Avg ($5,800,352) ($5,800,352) ($6,436,430) ($21,865,766) ($5,800,352) ($5,800,352) Low/Max ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) Low/Min $72,148,456 $6,635,229 $69,296,886 ($20,264,375) $72,340,638 $25,479,254 Net Present Value of Net Revenues W/P Load/Generation Base/Max Base/Min High/Max High/Min Low/Max Low/Min Base/Avg $10,397,270 $3,096,440 $9,410,571 ($6,198,948) $10,439,804 $7,798,644 Base/Max ($5,295,828) ($6,279,682) ($5,526,976) ($9,130,465) ($5,295,828) ($5,623,915) & |Base/Min $42,330,953 $4,592,693 $39,682,778 ($5,903,055) $42,561,984 $11,175,288 '§ |High/Avg $40,034,951 $4,481,132 $33,902,187 ($6,006,912) $40,982,800 $11,008,494 3 |High/Max $22,994,887 $318,046 $18,680,932 ($8,019,180) $23,381,838 $5,435,099 & |High/Min $66,672,764 $4,672,084 $56,886,565 ($5,840,469) $68,518,284 $11,261,665 S | XHigh/Avg $44,770,088 $4,064,336 $37,649,217 ($6,239,685) $45,993,691 $10,123,543 5 XHigh/Max $32,136,375 $2,086,782 $26,896,636 ($7,019,900) $32,650,395 $7,764,761 = |XHigh/Min $71,244,621 $4,441,464 $60,559,137 ($5,978,858) $73,186,687 $10,991,812 ™ |Low/Avg ($2,926,588) ($2,926,588) ($3,058,818) ($7,521,702) ($2,926,588) ($2,926,588) Low/Max ($9,130,465) ($9,130,465) ($9,130,465) ($9,130,465) ($9,130,465) ($9,130,465) Low/Min $29,489,184 $4,429,786 $28,876,028 ($5,916,301) $29,523,428 $10,649,412 CAF ccmmonnent Associates, Inc. Page 49 engineer -canmiants construction managers Sensitivity #2 In Sensitivity #2, the FDPPA rates are higher than any of the other cases, so we would expect this case to have the best economic results of all. This is born out in tables 23 — 27 below. Table 23 Nominal Net Revenues — Historical Flows Sensitivity #2 Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist Base/Hist $47,398,077 $25,398,251 $51,938,131 High/Hist $98,693,404 $51,513,775 $110,714,798 Xhigh/Hist $106,909,412 $57,490,256 $121,546,125 Low/Hist $12,560,466 $12,560,466 $13,702,908 KPU Case Table 24 Net Present Values of Net Revenues — Historical Flows Sensitivity #2 Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist 9 |Base/Hist $16,684,842 $11,224,477 $17,940,070 5 High/Hist $36,536,178 $23,646,949 $39,762,106 2 Xhigh/Hist $41,365,867 $27,590,681 $45,496,554 |Low/Hist $5,052,338 $5,052,338 $5,391,668 Ay Commonwealth Associates, Inc. Page 50 engineer econsuliints «construction managers Table 25 Detailed Case Results Sensitivity #2 Assumptions — Historical Flows W/P=Base/Hist, KPU=Base/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year WP <<K W/P >> K W/P >> K W/P >> K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 31,488,133 31,488,133 0 $0.068 $0.040 $2,141,193 $2,141,193 $0 $462,449 $1,678,744 2010 0 30,607,948 30,607,948 0 $0.068 $0.040 $2,081,340 $2,081,340 $0 $288,570 $1,792,771 2011 0 33,322,890 33,322,890 0 $0.068 $0.040 $2,265,957 $2,265,957 $0 $454,181 $1,811,775 2012 0 11,399,531 11,399,531 0 $0.069 $0.041 $786,568 $786,568 $0 $465,536 $321,032 2013 0 32,824,223 32,824,223 0 $0.069 $0.041 $2,264,871 $2,264,871 $0 $1,481,614 $783,258 2014 0 14,800,902 14,800,902 0 $0.069 $0.041 $1,021,262 $1,021,262 $0 $511,035 $510,227 2015 0 10,018,617 10,018,617 0 $0.070 $0.042 $701,303 $701,303 $0 $501,331 $199,972 2016 0 15,276,592 15,276,592 0 $0.070 $0.042 $1,069,361 $1,069,361 $0 $530,505 $538,856 2017 0 11,905,300 11,905,300 0 $0.070 $0.042 $833,371 $833,371 $0 $543,768 $289,603 2018 0 14,705,970 14,705,970 0 $0.071 $0.043 $1,044,124 $1,044,124 $0 $785,993 $258,131 2019 0 22,861,780 22,861,780 0 $0.071 $0.043 $1,623,186 $1,623,186 $0 $596,110 $1,027,077 2020 0 23,865,983 23,865,983 0 $0.071 $0.043 $1,694,485 $1,694,485 $0 $585,579 $1,108,906 2021 0 33,688,231 33,688,231 0 $0.072 $0.044 $2,425,553 $2,425,553 $0 $600,218 $1,825,334 2022 0 44,014,141 44,014,141 0 $0.072 $0.044 $3,169,018 $3,169,018 $0 $615,224 $2,553,794 2023 0 39,146,057 39,146,057 0 $0.072 $0.044 $2,818,516 $2,818,516 $0 $2,410,898 $407,618 2024 0 50,012,004 50,012,004 0 $0.073 $0.045 $3,650,876 $3,650,876 $0 $674,443 $2,976,433 2025 0 42,938,156 42,938,156 0 $0.073 $0.045 $3,134,485 $3,134,485 $0 $662,529 $2,471,957 2026 0 28,465,580 28,465,580 0 $0.073 $0.045 $2,077,987 $2,077,987 $0 $679,092 $1,398,896 2027 0 47,849,864 47,849,864 0 $0.074 $0.046 $3,540,890 $3,540,890 $0 $696,069 $2,844,821 2028 0 16,733,848 16,733,848 0 $0.074 $0.046 $1,238,305 $1,238,305 $0 $1,006,138 $232,167 2029 0 29,858,230 29,858,230 0 $0.074 $0.046 $2,209,509 $2,209,509 $0 $763,071 $1,446,438 2030 0 24,912,147 24,912,147 0 $0.075 $0.047 $1,868,411 $1,868,411 $0 $749,590 $1,118,821 2031 0 29,639,460 29,639,460 0 $0.075 $0.047 $2,222,960 $2,222,960 $0 $768,330 $1,454,629 2032 0 32,905,974 32,905,974 0 $0.075 $0.047 $2,467,948 $2,467,948 $0 $787,538 $1,680,410 2033 0 45,110,207 45,110,207 0 $0.076 $0.048 $3,428,376 $3,428,376 $0 $2,453,118 $975,258 2034 0 44,120,100 44,120,100 0 $0.076 $0.048 $3,353,128 $3,353,128 $0 $863,344 $2,489,783 2035 0 50,906,401 50,906,401 0 $0.076 $0.048 $3,868,886 $3,868,886 $0 $848,093 $3,020,794 2036 0 56,976,659 56,976,659 0 $0.077 $0.049 $4,387,203 $4,387,203 $0 $869,295 $3,517,908 2037 0 52,045,917 52,045,917 0 $0.077 $0.049 $4,007,536 $4,007,536 $0 $891,027 $3,116,508 2038 0 58,487,443 58,487,443 0 $0.077 $0.049 $4,503,533 $4,503,533 $0 $957,378 $3,546,155 Nominal Values 980,888,289 980,888,289 0 $71,900,141 $71,900,141 $0 $24,502,065 $47,398,077 Net Present Value $25,815,307 $25,815,307 $0 $9,130,465 $16,684,842 VAY Commonwealth Associates, Inc. Page 51 cagineem -consnitants - construction managers Table 26 Detailed Case Results Sensitivity #2 Assumptions — Historical Flows W/P=Base/Hist, KPU=Low/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year W/P <<K W/P >> K W/P >> K W/P >> K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 26,282,440 26,282,440 0 $0.068 $0.040 $1,787,206 $1,787,206 $0 $462,449 $1,324,757 2010 0 26,706,110 26,706,110 0 $0.068 $0.040 $1,816,015 $1,816,015 $0 $288,570 $1,527,446 2011 0 26,308,702 26,308,702 0 $0.068 $0.040 $1,788,992 $1,788,992 $0 $454,181 $1,334,811 2012 0 5,773,513 5,773,513 0 $0.069 $0.041 $398,372 $398,372 $0 $465,536 ($67,163) 2013 0 21,657,343 21,657,343 0 $0.069 $0.041 $1,494,357 $1,494,357 $0 $1,481,614 $12,743 2014 0 11,376,196 11,376,196 0 $0.069 $0.041 $784,958 $784,958 $0 $511,035 $273,923 2015 0 0 0 0 $0.070 $0.042 $0 $0 $0 $501,331 ($501,331) 2016 0 4,087,031 4,087,031 0 $0.070 $0.042 $286,092 $286,092 $0 $530,505 ($244,413) 2017 0 0 0 0 $0.070 $0.042 $0 $0 $0 $543,768 ($543,768) 2018 0 0 0 0 $0.071 $0.043 $0 $0 $0 $785,993 ($785,993) 2019 0 4,492,304 4,492,304 0 $0.071 $0.043 $318,954 $318,954 $0 $596,110 ($277,156) 2020 0 5,578,802 5,578,802 0 $0.071 $0.043 $396,095 $396,095 $0 $585,579 ($189,484) 2021 0 20,418,852 20,418,852 0 $0.072 $0.044 $1,470,157 $1,470,157 $0 $600,218 $869,939 2022 0 29,204,546 29,204,546 0 $0.072 $0.044 $2,102,727 $2,102,727 $0 $615,224 $1,487,504 2023 0 28,188,242 28,188,242 0 $0.072 $0.044 $2,029,553 $2,029,553 $0 $2,410,898 ($381,344) 2024 0 34,817,151 34,817,151 0 $0.073 $0.045 $2,541,652 $2,541,652 $0 $674,443 $1,867,209 2025 0 29,146,607 29,146,607 0 $0.073 $0.045 $2,127,702 $2,127,702 $0 $662,529 $1,465,174 2026 0 9,630,158 9,630,158 0 $0.073 $0.045 $703,002 $703,002 $0 $679,092 $23,910 2027 0 28,996,466 28,996,466 0 $0.074 $0.046 $2,145,738 $2,145,738 $0 $696,069 $1,449,669 2028 0 13,340,212 13,340,212 0 $0.074 $0.046 $987,176 $987,176 $0 $1,006,138 ($18,962) 2029 0 95513;572; 5,513,572 0 $0.074 $0.046 $408,004 $408,004 $0 $763,071 ($355,066) 2030 0 9,835,108 9,835,108 0 $0.075 $0.047 $737,633 $737,633 $0 $749,590 ($11,957) 2031 0 5,517,634 5,517,634 0 $0.075 $0.047 $413,823 $413,823 $0 $768,330 ($354,508) 2032 0 4,822,824 4,822,824 0 $0.075 $0.047 $361,712 $361,712 $0 $787,538 ($425,827) 2033 0 13,460,481 13,460,481 0 $0.076 $0.048 $1,022,997 $1,022,997 $0 $2,453,118 ($1,430,121) 2034 0 11,756,117 11,756,117 0 $0.076 $0.048 $893,465 $893,465 $0 $863,344 $30,121 2035 0 27,053,611 27,053,611 0 $0.076 $0.048 $2,056,074 $2,056,074 $0 $848,093 $1,207,982 2036 0 33,634,084 33,634,084 0 $0.077 $0.049 $2,589,824 $2,589,824 $0 $869,295 $1,720,530 2037 0 33,127,102 33,127,102 0 $0.077 $0.049 $2,550,787 $2,550,787 $0 $891,027 $1,659,760 2038 0 37,006,023 37,006,023 0 $0.077 $0.049 $2,849,464 $2,849,464 $0 $957,378 $1,892,086 Nominal Values 507,731,229 507,731,229 0 $37,062,531 $37,062,531 $0 $24,502,065 $12,560,466 Net Present Value $14,182,803 $14,182,803 $0 $9,130,465 $5,052,338 VA] Commonwealth Associates, Inc. Page 52 cagineer -consultants. contruction managers Table 27 Case Results — Extreme Flows Sensitivity #2 Assumptions Nominal Net Revenue-Historic Flows W/P Load/Generation Base/Max Base/Min High/Max High/Min Low/Max Low/Min Base/Avg $38,804,690 $7,800,146 $34,009,205 ($20,341,422) $39,072,593 $26,020,079 Base/Max ($5,719,180) ($10,952,334) ($7,025,260) ($24,502,065) ($5,719,180) ($7,615,377) & |Base/Min $120,620,633 $9,117,684 $107,629,905 ($20,251,594) $121,772,136 $30,324,864 '§ |High/Avg $133,276,859 $9,367,154 $106,281,956 ($20,316,549) $137,537,361 $30,451,195 3 |High/Max $96,374,868 $4,297,814 $74,872,355 ($22,556,532) $98,667,853 $23,279,779 6 |High/Min $191,100,797 $9,345,292 $150,976,966 ($20,156,169) $198,841,819 $30,423,729 3 XHigh/Avg $142,455,002 $8,597,924 $113,058,372 ($20,660,490) $147,217,955 $28,768,998 3 |XHigh/Max $116,406,811 $5,591,105 $91,346,803 ($21,477,456) $119,311,229 $24,252,219 = |XHigh/Min $200,269,317 $8,907,086 $157,530,844 ($20,342,270) $208,300,809 $29,851,540 “ |Low/Avg ($4,225,844) ($4,225,844) ($4,937,527) ($21,811,657) ($4,225,844) ($4,225,844) Low/Max ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) Low/Min $78,830,242 $8,563,601 $75,640,938 ($20,251,497) $79,047,860 $29,001,563 Net Present Value of Net Revenues W/P Load/Generation Base/Max Base/Min High/Max High/Min Low/Max Low/Min Base/Avg $11,704,188 $3,708,827 $10,610,465 ($6,177,742) $11,752,351 $8,821,263 Base/Max ($4,878,060) ($5,976,632) ($5,137,514) ($9,130,465) ($4,878,060) ($5,246,956) & |Base/Min $45,136,294 $5,177,165 $42,203,126 ($5,894,746) $45,392,757 $12,199,695 3 High/Avg $43,302,267 $5,078,724 $36,569,990 ($5,997,562) $44,344,358 $12,044,412 2 |High/Max $25,649,271 $925,610 $20,860,670 ($7,992,931) $26,085,325 $6,463,424 & |High/Min $70,902,877 $5,261,191 $60,222,597 ($5,830,673) $72,920,558 $12,286,142 3 XHigh/Avg $48,056,820 $4,646,842 $40,330,941 ($6,230,335) $49,375,809 $11,112,652 3 XHigh/Max $34,927,157 $2,594,929 $29,205,376 ($7,010,018) $35,491,254 $8,594,708 = |XHigh/Min $75,490,658 $5,017,869 $63,905,749 ($5,970,517) $77,605,150 $11,997,291 M JLow/Avg ($2,502,524) ($2,502,524) ($2,650,273) ($7,490,206) ($2,502,524) ($2,502,524) Low/Max ($9,130,465) ($9,130,465) ($9,130,465) ($9,130,465) ($9,130,465) ($9,130,465) Low/Min $31,428,583 $5,005,567 $30,745,729 ($5,907,925) $31,467,360 $11,652,712 Cay Commonwealth Associates, Inc. Page 53 engineers -consulltants construction managers Sensitivity #3 Sensitivity #3 uses the lowest rates of any of the model runs. These rates are derived from those used in a study conducted by A. Dashen & Associates dated August 9, 2002. The rates in that study went out to 2031. CAI extended those rates through 2038 using the same underlying assumptions as those used by Dashen. The results of this sensitivity run are shown in tables 28 — 32. Table 28 Nominal Net Revenues — Historical Flows Sensitivity #3 Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist 2 Base/Hist $34,668,392 $16,771,315 $38,273,833 © |High/Hist $76,467,745 $38,487,898 $86,157,520 2 Xhigh/Hist $85,358,761 $44,780,729 $97,352,896 % |Low/Hist $6,374,177 $6,374,177 $7,310,945 Table 29 Net Present Values of Net Revenues — Historical Flows Sensitivity #3 Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist Base/Hist $12,730,066 $8,323,668 $13,717,507 High/Hist $29,323,152 $19,021,771 $31,905,324 Xhigh/Hist $34,343,686 $23,055,243 $37,721,461 Low/Hist $3,139,798 $3,139,798 $3,420,004 KPU Case Even with the much lower rates used in this sensitivity; the results continue to be positive in all cases. However, Table 30 shows that there are a few negative years in this case. This is the first time negative years have shown up in the run where both Wrangell — Petersburg and KPU are experiencing base load growth and this indicates the impact of the lower rates used in this sensitivity. However, the overall results continue to be positive. In Table 32, which shows the extreme inflow cases, there are a couple more years with negative results but still no major swing. The majority of the extreme cases continue to be positive. TD asia susie les: Associates, Inc. DRAFT DRAFT DRAFT Page 54 engineer scons -copatruceion managers Table 30 Detailed Case Results Sensitivity #3 Assumptions — Historical Flows W/P=Base/Hist, KPU=Base/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year W/P <<K W/P >> K W/P >> K W/P >> K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 31,488,133 31,488,133 0 $0.068 $0.040 $2,141,193 $2,141,193 $0 $462,449 $1,678,744 2010 0 30,607,948 30,607,948 0 $0.068 $0.040 $2,081,340 $2,081,340 $0 $288,570 $1,792,771 2011 0 33,322,890 33,322,890 0 $0.068 $0.040 $2,265,957 $2,265,957 $0 $454,181 $1,811,775 2012 0 11,399,531 11,399,531 0 $0.068 $0.041 $775,168 $775,168 $0 $465,536 $309,632 2013 0 32,824,223 32,824,223 0 $0.068 $0.041 $2,232,047 $2,232,047 $0 $1,481,614 $750,434 2014 0 14,800,902 14,800,902 0 $0.068 $0.041 $1,006,461 $1,006,461 $0 $511,035 $495,427 2015 0 10,018,617 10,018,617 0 $0.068 $0.042 $681,266 $681,266 $0 $501,331 $179,935 2016 0 15,276,592 15,276,592 0 $0.068 $0.042 $1,038,808 $1,038,808 $0 $530,505 $508,303 2017 0 11,905,300 11,905,300 0 $0.068 $0.042 $809,560 $809,560 $0 $543,768 $265,792 2018 0 14,705,970 14,705,970 0 $0.049 $0.043 $722,063 $722,063 $0 $785,993 ($63,930) 2019 0 22,861,780 22,861,780 0 $0.050 $0.043 $1,138,517 $1,138,517 $0 $596,110 $542,407 2020 0 23,865,983 23,865,983 0 $0.051 $0.043 $1,207,619 $1,207,619 $0 $585,579 $622,040 2021 0 33,688,231 33,688,231 0 $0.051 $0.044 $1,728,206 $1,728,206 $0 $600,218 $1,127,988 2022 0 44,014,141 44,014,141 0 $0.052 $0.044 $2,293,137 $2,293,137 $0 $615,224 $1,677,913 2023 0 39,146,057 39,146,057 0 $0.053 $0.044 $2,070,826 $2,070,826 $0 $2,410,898 ($340,071) 2024 0 50,012,004 50,012,004 0 $0.054 $0.045 $2,685,645 $2,685,645 $0 $674,443 $2,011,201 2025 0 42,938,156 42,938,156 0 $0.055 $0.045 $2,340,129 $2,340,129 $0 $662,529 $1,677,601 2026 0 28,465,580 28,465,580 0 $0.055 $0.045 $1,574,147 $1,574,147 $0 $679,092 $895,055 2027 0 47,849,864 47,849,864 0 $0.056 $0.046 $2,689,162 $2,689,162 $0 $696,069 $1,993,093 2028 0 16,733,848 16,733,848 0 $0.057 $0.046 $953,829 $953,829 $0 $1,006,138 ($52,309) 2029 0 29,858,230 29,858,230 0 $0.058 $0.046 $1,728,792 $1,728,792 $0 $763,071 $965,721 2030 0 24,912,147 24,912,147 0 $0.059 $0.047 $1,464,834 $1,464,834 $0 $749,590 $715,244 2031 0 29,639,460 29,639,460 0 $0.060 $0.047 $1,769,476 $1,769,476 $0 $768,330 $1,001,146 2032 0 32,905,974 32,905,974 0 $0.061 $0.047 $1,996,245 $1,996,245 $0 $787,538 $1,208,707 2033 0 45,110,207 45,110,207 0 $0.062 $0.048 $2,779,711 $2,779,711 $0 $2,453,118 $326,593 2034 0 44,120,100 44,120,100 0 $0.063 $0.048 $2,761,691 $2,761,691 $0 $863,344 $1,898,346 2035 0 50,906,401 50,906,401 0 $0.064 $0.048 $3,237,074 $3,237,074 $0 $848,093 $2,388,981 2036 0 56,976,659 56,976,659 0 $0.065 $0.049 $3,680,835 $3,680,835 $0 $869,295 $2,811,541 2037 0 52,045,917 52,045,917 0 $0.066 $0.049 $3,416,115 $3,416,115 $0 $891,027 $2,525,088 2038 0 58,487,443 58,487,443 0 $0.067 $0.049 $3,900,603 $3,900,603 $0 $957,378 $2,943,225 Nominal Values 980,888,289 980,888,289 0 $59,170,457 $59,170,457 $0 $24,502,065 $34,668,392 Net Present Value $21,860,531 $21,860,531 $0 $9,130,465 $12,730,066 VAY Commonwealth Associates, Inc. Page 55 cagincem -consuiunts «construction managers Table 31 Detailed Case Results Sensitivity #3 Assumptions — Historical Flows W/P=Base/Hist, KPU=Low/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year WIP <<K W/P >> K W/P >>K W/P >> K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 26,282,440 26,282,440 0 $0.068 $0.040 $1,787,206 $1,787,206 $0 $462,449 $1,324,757 2010 0 26,706,110 26,706,110 0 $0.068 $0.040 $1,816,015 $1,816,015 $0 $288,570 $1,527,446 2011 0 26,308,702 26,308,702 0 $0.068 $0.040 $1,788,992 $1,788,992 $0 $454,181 $1,334,811 2012 0 557733513) 537733513 0 $0.068 $0.041 $392,599 $392,599 $0 $465,536 ($72,937) 2013 0 21,657,343 21,657,343 0 $0.068 $0.041 $1,472,699 $1,472,699 $0 $1,481,614 ($8,914) 2014 0 11,376,196 11,376,196 0 $0.068 $0.041 $773,581 $773,581 $0 $511,035 $262,547 2015 0 0 0 0 $0.068 $0.042 $0 $0 $0 $501,331 ($501,331) 2016 0 4,087,031 4,087,031 0 $0.068 $0.042 $277,918 $277,918 $0 $530,505 ($252,587) 2017 0 0 0 0 $0.068 $0.042 $0 $0 $0 $543,768 ($543,768) 2018 0 0 0 0 $0.049 $0.043 $0 $0 $0 $785,993 ($785,993) 2019 0 4,492,304 4,492,304 0 $0.050 $0.043 $223,717 $223,717 $0 $596,110 ($372,393) 2020 0 5,578,802 5,578,802 0 $0.051 $0.043 $282,287 $282,287 $0 $585,579 ($303,291) 2021 0 20,418,852 20,418,852 0 $0.051 $0.044 $1,047,487 $1,047,487 $0 $600,218 $447,269 2022 0 29,204,546 29,204,546 0 $0.052 $0.044 $1,521,557 $1,521,557 $0 $615,224 $906,333 2023 0 28,188,242 28,188,242 0 $0.053 $0.044 $1,491,158 $1,491,158 $0 $2,410,898 ($919,740) 2024 0 34,817,151 34,817,151 0 $0.054 $0.045 $1,869,681 $1,869,681 $0 $674,443 $1,195,238 2025 0 29,146,607 29,146,607 0 $0.055 $0.045 $1,588,490 $1,588,490 $0 $662,529 $925,961 2026 0 9,630,158 9,630,158 0 $0.055 $0.045 $532,548 $532,548 $0 $679,092 ($146,544) 2027 0 28,996,466 28,996,466 0 $0.056 $0.046 $1,629,601 $1,629,601 $0 $696,069 $933,532 2028 0 13,340,212 13,340,212 0 $0.057 $0.046 $760,392 $760,392 $0 $1,006,138 ($245,746) 2029 0 3,513,572 5,513,572 0 $0.058 $0.046 $319,236 $319,236 $0 $763,071 ($443,835) 2030 0 9,835,108 9,835,108 0 $0.059 $0.047 $578,304 $578,304 $0 $749,590 ($171,286) 2031 0 5,517,634 5,517,634 0 $0.060 $0.047 $329,403 $329,403 $0 $768,330 ($438,927) 2032 0 4,822,824 4,822,824 0 $0.061 $0.047 $292,577 $292,577 $0 $787,538 ($494,961) 2033 0 13,460,481 13,460,481 0 $0.062 $0.048 $829,441 $829,441 $0 $2,453,118 ($1,623,677) 2034 0 11,756,117 11,756,117 0 $0.063 $0.048 $735,872 $735,872 $0 $863,344 ($127,472) 2035 0 27,053,611 27,053,611 0 $0.064 $0.048 $1,720,305 $1,720,305 $0 $848,093 $872,212 2036 0 33,634,084 33,634,084 0 $0.065 $0.049 $2,172,846 $2,172,846 $0 $869,295 $1,303,551 2037 0 33,127,102 33,127,102 0 $0.066 $0.049 $2,174,349 $2,174,349 $0 $891,027 $1,283,322 2038 0 37,006,023 37,006,023 0 $0.067 $0.049 $2,467,980 $2,467,980 $0 $957,378 $1,510,602 Nominal Values 507,731,229 507,731,229 0 $30,876,242 $30,876,242 $0 $24,502,065 $6,374,177 Net Present Value $12,270,263 $12,270,263 $0 $9,130,465 $3,139,798 VA] Commonwealth Associates, Inc. Page 56 eigineem -cannluants- construction managers Table 32 Case Results — Extreme Flows Sensitivity #3 Assumptions Nominal Net Revenue-Historic Flows W/P Load/Generation Base/Max Base/Min High/Max High/Min Low/Max Low/Min Base/Avg $27,044,738 $2,270,163 $23,134,914 ($20,373,724) $27,273,380 $16,594,114 Base/Max ($9,158,032) ($13,492,892) ($10,250,794) ($24,502,065) ($9,158,032) ($10,751,055) & |Base/Min $95,379,740 $3,883,057 $84,707,060 ($20,264,375) $96,324,568 $21,099,011 ‘§ |High/Avg $103,573,627 $4,017,978 $81,779,829 ($20,331,029) $107,019,911 $21,135,679 3 |High/Max $72,267,814 ($1,399,987) $54,628,617 ($22,602,095) $74,202,879 $13,597,656 & |High/Min $152,510,974 $4,066,664 $120,451,216 ($20,171,676) $158,741,570 $21,203,050 3 XHigh/Avg $112,592,448 $3,372,076 $88,444,166 ($20,674,970) $116,524,888 $19,763,819 3 |XHigh/Max $91,219,729 $1,142,900 $70,084,963 ($21,492,351) $93,759,345 $16,894,629 > |XHigh/Min $161,535,947 $3,745,010 $126,912,754 ($20,355,304) $168,053,753 $20,796,498 Z Low/Avg ($8,041,336) ($8,041,336) ($8,632,104) ($21,865,766) ($8,041,336) ($8,041,336) Low/Max ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) Low/Min $61,404,376 $3,377,716 $58,765,453 ($20,264,375) $61,590,590 $19,948,373 Net Present Value of Net Revenues W/P Load/Generation Base/Max Base/Min High/Max High/Min Low/Max Low/Min Base/Avg $8,113,810 $1,826,045 $7,229,208 ($6,198,948) $8,154,891 $5,776,540 Base/Max ($5,685,967) ($6,591,135) ($5,902,409) ($9,130,465) ($5,685,967) ($5,995,253) & |Base/Min $37,025,810 $3,438,798 $34,641,248 ($5,903,055) $37,234,146 $9,222,778 2 High/Avg $34,114,679 $3,299,140 $28,750,968 ($6,006,912) $34,942,335 $9,035,748 2 |High/Max $18,547,134 ($1,004,062) $14,656,046 ($8,019,180) $18,914,324 $3,321,980 & |High/Min $58,377,325 $3,510,564 $49,948,117 ($5,840,469) $59,988,369 $9,318,047 3 XHigh/Avg $38,805,705 $2,909,760 $32,464,417 ($6,239,685) $39,902,717 $8,237,514 3 XHigh/Max $27,371,208 $1,177,089 $22,561,706 ($7,019,900) $27,865,178 $6,261,155 > |XHigh/Min $62,910,850 $3,309,107 $53,593,169 ($5,978,858) $64,617,322 $9,082,068 Z Low/Avg ($3,681,224) ($3,681,224) ($3,803,380) ($7,521,702) ($3,681,224) ($3,681,224) Low/Max ($9,130,465) ($9,130,465) ($9,130,465) ($9,130,465) ($9,130,465) ($9,130,465) Low/Min $25,708,454 $3,268,972 $25,149,407 ($5,916,301) $25,741,616 $8,726,121 Cay Commonwealth Associates, Inc. Page 57 engineer sconsnlants -canstruction managers Sensitivity #4 In this sensitivity run, debt service is added to the costs that must be covered. There was no debt service in any of the other sensitivities or in the base case. It is assumed that $10 million is borrowed and paid back in flat payments. The assumed interest rate in 5.5% and the term of the debt is 20 years. The results for this sensitivity are shown in table 33 — 37. Table 33 Nominal Net Revenues — Historical Flows Sensitivity #4 Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist Base/Hist $28,838,657 $8,007,941 $33,135,070 High/Hist $77,310,722 $32,657,457 $88,689,180 Xhigh/Hist $85,617,093 $38,636,663 $99,541,934 Low/Hist ($4,106,325) ($4,106,325) ($3,025,330) KPU Case Table 34 Net Present Values of Net Revenues — Historical Flows Sensitivity #4 Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist Q |Base/Hist $7,583,645 $2,416,208 $8,770,988 5 High/Hist $26,327,199 $14,135,285 $29,378,771 2 Xhigh/Hist $31,157,214 $18,055,960 $35,089,240 < |Low/Hist ($3,406,818) ($3,406,818) ($3,086,119) It is clear that the debt service had an impact on the results. The annual costs have increased sufficiently such that when KPU loads are low, there is not enough revenue to cover the costs of the line and the overall economics are negative. However, the results are still strongly positive if KPU loads are at base level or above. Table 35 shows that even though the results are positive over the entire study period, there is a string of 7 negative years in a row in the case where base load growth is assumed. Table 37 shows that now 36, or one-half, of the extreme inflow cases are negative. Clearly, debt service adds a significant additional burden to the economics of the STI. Cay Commonwealth Associates, Inc. Page 58 engineers -consultasits - construction managers Table 35 Detailed Case Results Sensitivity #4 Assumptions — Historical Flows W/P=Base/Hist, KPU=Base/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year W/P << K W/P >>K W/P >>K W/P >> K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 31,488,133 31,488,133 0 $0.064 $0.040 $2,015,241 $2,015,241 $0 $1,244,242 $770,998 2010 0 30,607,948 30,607,948 0 $0.064 $0.040 $1,958,909 $1,958,909 $0 $1,070,363 $888,546 2011 0 33,322,890 33,322,890 0 $0.064 $0.040 $2,132,665 $2,132,665 $0 $1,235,974 $896,690 2012 0 11,399,531 11,399,531 0 $0.065 $0.041 $740,969 $740,969 $0 $1,247,329 ($506,360) 2013 0 32,824,223 32,824,223 0 $0.065 $0.041 $2,133,574 $2,133,574 $0 $2,263,407 ($129,832) 2014 0 14,800,902 14,800,902 0 $0.065 $0.041 $962,059 $962,059 $0 $1,292,828 ($330,769) 2015 0 10,018,617 10,018,617 0 $0.066 $0.042 $661,229 $661,229 $0 $1,283,124 ($621,896) 2016 0 15,276,592 15,276,592 0 $0.066 $0.042 $1,008,255 $1,008,255 $0 $1,312,299 ($304,044) 2017 0 11,905,300 11,905,300 0 $0.066 $0.042 $785,750 $785,750 $0 $1,325,561 ($539,812) 2018 0 14,705,970 14,705,970 0 $0.067 $0.043 $985,300 $985,300 $0 $1,567,787 ($582,487) 2019 0 22,861,780 22,861,780 0 $0.067 $0.043 $1,531,739 $1,531,739 $0 $1,377,903 $153,836 2020 0 =. 23,865,983 23,865,983 0 $0.067 $0.043 $1,599,021 $1,599,021 $0 $1,367,372 $231,649 2021 0 33,688,231 33,688,231 0 $0.068 $0.044 $2,290,800 $2,290,800 $0 $1,382,012 $908,788 2022 0 44,014,141 44,014,141 0 $0.068 $0.044 $2,992,962 $2,992,962 $0 $1,397,017 $1,595,945 2023 0 39,146,057 39,146,057 0 $0.068 $0.044 $2,661,932 $2,661,932 $0 $3,192,691 ($530,759) 2024 0 50,012,004 50,012,004 0 $0.069 $0.045 $3,450,828 $3,450,828 $0 $1,456,237 $1,994,592 2025 0 42,938,156 42,938,156 0 $0.069 $0.045 $2,962,733 $2,962,733 $0 $1,444,322 $1,518,411 2026 0 28,465,580 28,465,580 0 $0.069 $0.045 $1,964,125 $1,964,125 $0 $1,460,885 $503,240 2027 0 47,849,864 47,849,864 0 $0.070 $0.046 $3,349,490 $3,349,490 $0 $1,477,862 $1,871,628 2028 0 16,733,848 16,733,848 0 $0.070 $0.046 $1,171,369 $1,171,369 $0 $787,931 $383,438 2029 0 29,858,230 29,858,230 0 $0.070 $0.046 $2,090,076 $2,090,076 $0 $763,071 $1,327,005 2030 0 24,912,147 24,912,147 0 $0.071 $0.047 $1,768,762 $1,768,762 $0 $749,590 $1,019,172 2031 0 29,639,460 29,639,460 0 $0.071 $0.047 $2,104,402 $2,104,402 $0 $768,330 $1,336,072 2032 0 32,905,974 32,905,974 0 $0.071 $0.047 $2,336,324 $2,336,324 $0 $787,538 $1,548,786 2033 0 45,110,207 45,110,207 0 $0.072 $0.048 $3,247,935 $3,247,935 $0 $2,453,118 $794,817 2034 0 44,120,100 44,120,100 0 $0.072 $0.048 $3,176,647 $3,176,647 $0 $863,344 $2,313,303 2035 0 50,906,401 50,906,401 0 $0.072 $0.048 $3,665,261 $3,665,261 $0 $848,093 $2,817,168 2036 0 56,976,659 56,976,659 0 $0.073 $0.049 $4,159,296 $4,159,296 $0 $869,295 $3,290,001 2037 0 52,045,917 52,045,917 0 $0.073 $0.049 $3,799,352 $3,799,352 $0 $891,027 $2,908,325 2038 0 58,487,443 58,487,443 0 $0.073 $0.049 $4,269,583 $4,269,583 $0 $957,378 $3,312,205 Nominal Values 980,888,289 980,888,289 0 $67,976,588 $67,976,588 $0 $39,137,931 $28,838,657 Net Present Value $24,378,634 $24,378,634 $0 $16,794,988 $7,583,645 VAY Commonwealth Associates, Inc. Page 59 eager -cunstltants + canstruetion managers Table 36 Detailed Case Results Sensitivity #4 Assumptions — Historical Flows W/P=Base/Hist, KPU=Low/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year W/P <<K W/P >>K W/P >> K W/P >> K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 26,282,440 26,282,440 0 $0.064 $0.040 $1,682,076 $1,682,076 $0 $1,244,242 $437,834 2010 0 26,706,110 26,706,110 0 $0.064 $0.040 $1,709,191 $1,709,191 $0 $1,070,363 $638,828 2011 0 26,308,702 26,308,702 0 $0.064 $0.040 $1,683,757 $1,683,757 $0 $1,235,974 $447,782 2012 0 5,/73)513) 53773,513) 0 $0.065 $0.041 $375,278 $375,278 $0 $1,247,329 ($872,051) 2013 0 21,657,343 21,657,343 0 $0.065 $0.041 $1,407,727 $1,407,727 $0 $2,263,407 ($855,680) 2014 0 11,376,196 11,376,196 0 $0.065 $0.041 $739,453 $739,453 $0 $1,292,828 ($553,375) 2015 0 0 0 0 $0.066 $0.042 $0 $0 $0 $1,283,124 ($1,283,124) 2016 0 4,087,031 4,087,031 0 $0.066 $0.042 $269,744 $269,744 $0 $1,312,299 ($1,042,555) 2017 0 0 0 0 $0.066 $0.042 $0 $0 $0 $1,325,561 ($1,325,561) 2018 0 0 0 0 $0.067 $0.043 $0 $0 $0 $1,567,787 ($1,567,787) 2019 0 4,492,304 4,492,304 0 $0.067 $0.043 $300,984 $300,984 $0 $1,377,903 ($1,076,918) 2020 0 5,578,802 5,578,802 0 $0.067 $0.043 $373,780 $373,780 $0 $1,367,372 ($993,592) 2021 0 20,418,852 20,418,852 0 $0.068 $0.044 $1,388,482 $1,388,482 $0 $1,382,012 $6,470 2022 0 29,204,546 29,204,546 0 $0.068 $0.044 $1,985,909 $1,985,909 $0 $1,397,017 $588,892 2023 0 28,188,242 28,188,242 0 $0.068 $0.044 $1,916,800 $1,916,800 $0 $3,192,691 ($1,275,890) 2024 0 34,817,151 34,817,151 0 $0.069 $0.045 $2,402,383 $2,402,383 $0 $1,456,237 $946,147 2025 0 29,146,607 29,146,607 0 $0.069 $0.045 $2,011,116 $2,011,116 $0 $1,444,322 $566,794 2026 0 9,630,158 9,630,158 0 $0.069 $0.045 $664,481 $664,481 $0 $1,460,885 ($796,404) 2027 0 28,996,466 28,996,466 0 $0.070 $0.046 $2,029,753 $2,029,753 $0 $1,477,862 $551,890 2028 0 13,340,212 13,340,212 0 $0.070 $0.046 $933,815 $933,815 $0 $787,931 $145,884 2029 0 93913572 33913572 0 $0.070 $0.046 $385,950 $385,950 $0 $763,071 ($377,121) 2030 0 9,835,108 9,835,108 0 $0.071 $0.047 $698,293 $698,293 $0 $749,590 ($51,298) 2031 0 5,517,634 5,517,634 0 $0.071 $0.047 $391,752 $391,752 $0 $768,330 ($376,578) 2032 0 4,822,824 4,822,824 0 $0.071 $0.047 $342,420 $342,420 $0 $787,538 ($445,118) 2033 0 13,460,481 13,460,481 0 $0.072 $0.048 $969,155 $969,155 $0 $2,453,118 ($1,483,963) 2034 0 11,756,117 11,756,117 0 $0.072 $0.048 $846,440 $846,440 $0 $863,344 ($16,904) 2035 0 27,053,611 27,053,611 0 $0.072 $0.048 $1,947,860 $1,947,860 $0 $848,093 $1,099,767 2036 0 33,634,084 33,634,084 0 $0.073 $0.049 $2,455,288 $2,455,288 $0 $869,295 $1,585,993 2037 0 33,127,102 33,127,102 0 $0.073 $0.049 $2,418,278 $2,418,278 $0 $891,027 $1,527,251 2038 0 37,006,023 37,006,023 0 $0.073 $0.049 $2,701,440 $2,701,440 $0 $957,378 $1,744,062 Nominal Values 507,731,229 507,731,229 0 $35,031,606 $35,031,606 $0 $39,137,931 ($4,106,325) Net Present Value $13,388,170 $13,388,170 $0 $16,794,988 ($3,406,818) VAY Commonwealth Associates, Inc. Page 60 ‘engineers -consuhants construction managers Cay Table 37 Case Results — Extreme Flows Sensitivity #4 Assumptions Nominal Net Revenue-Historic Flows Base/Avg Base/Max KPU Load/Generation Low/Avg Low/Max Low/Min [ W/P Load/Generation ] Base/Max $20,733,908 ($21,348,097) $98,032,287 $110,071,083 $75,239,227 $164,652,091 $119,172,677 $94,711,776 $173,759,240 ($19,961,811) ($39,137,931) $58,509,052 Base/Min ($8,615,974) ($26,306,107) ($7,379,145) ($7,141,904) ($11,910,627) ($7,163,766) ($7,802,063) ($10,484,624) ($7,539,509) ($19,961,811) ($39,137,931) ($7,903,871) Net Present Value of Net Revenues Base/Avg Base/Max Base/Min High/Avg High/Max High/Min XHigh/Avg XHigh/Max XHigh/Min Low/Avg Low/Max Low/Min < 3 £ a < o 3 ° 4 > a mM Commonwealth Associates, Inc. cagincers -conubants construction manaygers W/P Load/Generation Base/Max $2,890,975 ($12,768,150) $34,444,629 $32,745,660 $16,095,022 $58,779,341 $37,458,934 $25,061,479 $63,335,245 ($10,531,980) ($16,794,988) $21,492,316 Base/Min ($4,674,926) ($13,808,849) ($3,294,603) ($3,386,481) ($7,294,708) ($3,215,246) ($3,750,104) ($5,617,389) ($3,422,922) ($10,531,980) ($16,794,988) ($3,456,617) High/Max $16,192,107 ($22,585,802) $85,727,599 $84,512,581 $54,871,739 $126,674,075 $91,226,947 $70,804,168 $133,180,583 ($20,636,077) ($39,137,931) $55,487,487 High/Max $1,855,293 ($13,014,007) $31,667,236 $26,374,135 $11,560,183 $48,674,719 $30,099,295 $19,597,504 $52,330,740 ($10,671,952) ($16,794,988) $20,845,530 High/Min ($35,220,132) ($39,137,931) ($35,136,736) ($35,197,770) ($37,304,161) ($35,046,763) ($35,492,576) ($36,242,379) ($35,205,285) ($36,602,599) ($39,137,931) ($35,136,639) High/Min ($14,014,707) ($16,794,988) ($13,749,116) ($13,845,823) ($15,722,824) ($13,688,725) ($14,041,614) ($14,765,412) ($13,807,815) ($15,249,362) ($16,794,988) ($13,761,516) Low/Max $20,987,895 Low/Min $8,625,007 ($21,348,097) ($23,145,159) $99,123,008 $114,105,347 $77,412,608 $171,979,889 $123,706,298 $97,494,224 $181,376,244 $12,676,372 $12,797,171 $6,048,905 $12,769,704 $11,354,095 $7,346,219 $12,279,187 ($19,961,811) ($19,961,811) ($39,137,931) ($39,137,931) $58,715,365 Low/Max $2,936,636 ($12,768,150) $34,687,502 $33,731,996 $16,508,313 $60,688,462 $38,720,736 $25,602,380 $65,340,450 $11,425,619 Low/Min $160,910 ($13,117,747) $3,340,716 $3,195,245 ($2,057,897) $3,422,082 $2,405,694 $109,088 $3,175,350 ($10,531,980) ($10,531,980) ($16,794,988) ($16,794,988) $21,529,078 $2,824,667 Page 61 Sensitivity #5 Sensitivity #5, the last sensitivity, puts all but one of the assumptions back to where they were in the base case. The one difference is that it is assumed that Ketchikan goes forward with upgrades to their hydro projects and that these upgrades add 14 million kWh per year to the output of those projects. This will significantly reduce the diesel generation in Ketchikan, thereby reducing power traveling across the STI. Where there were 980 million kWh sent to Ketchikan from Tyee over the study period under base loads in the other model runs, in this sensitivity that drops to 632 million kWh. Tables 38 — 42 show the results of this sensitivity. Table 38 Nominal Net Revenues — Historical Flows Sensitivity #5 Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist Base/Hist $19,759,655 $6,517,641 $21,569,720 High/Hist $78,944,586 $40,435,510 $88,846,714 Xhigh/Hist $90,190,856 $46,693,414 $102,351,633 LowHist ($13,867,057) ($13,867,057) ($13,829,897) KPU Case Table 39 Net Present Values of Net Revenues — Historical Flows Sensitivity #5 Assumptions All Load Growth Scenarios W/P Load/Generation Base/Hist High/Hist Low/Hist g Base/Hist $4,837,628 $1,632,577 $5,254,705 © |High/Hist $27,137,894 $17,409,852 $29,641,035 © |Xhigh/Hist $33,091,349 $21,541,741 $36,252,614 % |Low/Hist ($5,646,519) ($5,646,519) ($5,639,820) Table 41 shows that when KPU loads are low, there are very few years where STI revenues cover the annual costs. Cay Commonwealth Associates, Inc. Page 62 enwee rs sCoMMEMAES econntructiOn manager Table 40 Detailed Case Results Sensitivity #5 Assumptions — Historical Flows W/P=Base/Hist, KPU=Base/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year W/P <<K W/P >>K W/P >> K W/P >> K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 3,697,261 3,697,261 0 $0.064 $0.040 $236,625 $236,625 $0 $462,449 ($225,824) 2010 0 20,936,249 20,936,249 0 $0.064 $0.040 $1,339,920 $1,339,920 $0 $288,570 $1,051,350 2011 0 19,325,410 19,325,410 0 $0.064 $0.040 $1,236,826 $1,236,826 $0 $454,181 $782,645 2012 0 4,180,220 4,180,220 0 $0.065 $0.041 $271,714 $271,714 $0 $465,536 ($193,821) 2013 0 12,158,649 12,158,649 0 $0.065 $0.041 $790,312 $790,312 $0 $1,481,614 ($691,301) 2014 0 9,881,092 9,881,092 0 $0.065 $0.041 $642,271 $642,271 $0 $511,035 $131,236 2015 0 0 0 0 $0.066 $0.042 $0 $0 $0 $501,331 ($501,331) 2016 0 0 0 0 $0.066 $0.042 $0 $0 $0 $530,505 ($530,505) 2017 0 0 0 0 $0.066 $0.042 $0 $0 $0 $543,768 ($543,768) 2018 0 0 0 0 $0.067 $0.043 $0 $0 $0 $785,993 ($785,993) 2019 0 0 0 0 $0.067 $0.043 $0 $0 $0 $596,110 ($596,110) 2020 0 6,372,145 6,372,145 0 $0.067 $0.043 $426,934 $426,934 $0 $585,579 ($158,645) 2021 0 23,035,024 23,035,024 0 $0.068 $0.044 $1,566,382 $1,566,382 $0 $600,218 $966,163 2022 0 32,856,750 32,856,750 0 $0.068 $0.044 $2,234,259 $2,234,259 $0 $615,224 $1,619,035 2023 0 31,167,259 31,167,259 0 $0.068 $0.044 $2,119,374 $2,119,374 $0 $2,410,898 ($291,524) 2024 0 40,534,696 40,534,696 0 $0.069 $0.045 $2,796,894 $2,796,894 $0 $674,443 $2,122,451 2025 0 34,333,285 34,333,285 0 $0.069 $0.045 $2,368,997 $2,368,997 $0 $662,529 $1,706,468 2026 0 16,530,268 16,530,268 0 $0.069 $0.045 $1,140,588 $1,140,588 $0 $679,092 $461,497 2027 0 38,816,059 38,816,059 0 $0.070 $0.046 $2,717,124 $2,717,124 $0 $696,069 $2,021,055 2028 0 16,760,590 16,760,590 0 $0.070 $0.046 $1,173,241 $1,173,241 $0 $1,006,138 $167,103 2029 0 18,590,918 18,590,918 0 $0.070 $0.046 $1,301,364 $1,301,364 $0 $763,071 $538,294 2030 0 18,987,352 18,987,352 0 $0.071 $0.047 $1,348,102 $1,348,102 $0 $749,590 $598,512 2031 0 17,655,022 17,655,022 0 $0.071 $0.047 $1,253,507 $1,253,507 $0 $768,330 $485,176 2032 0 23,256,538 23,256,538 0 $0.071 $0.047 $1,651,214 $1,651,214 $0 $787,538 $863,676 2033 0 30,143,750 30,143,750 0 $0.072 $0.048 $2,170,350 $2,170,350 $0 $2,453,118 ($282,768) 2034 0 31,828,078 31,828,078 0 $0.072 $0.048 $2,291,622 $2,291,622 $0 $863,344 $1,428,277 2035 0 42,123,646 42,123,646 0 $0.072 $0.048 $3,032,902 $3,032,902 $0 $848,093 $2,184,810 2036 0 45,361,251 45,361,251 0 $0.073 $0.049 $3,311,371 $3,311,371 $0 $869,295 $2,442,076 2037 0 41,780,671 41,780,671 0 $0.073 $0.049 $3,049,989 $3,049,989 $0 $891,027 $2,158,962 2038 0 51,915,589 51,915,589 0 $0.073 $0.049 $3,789,838 $3,789,838 $0 $957,378 $2,832,460 Nominal Values 632,227,770 632,227,770 0 $44,261,720 $44,261,720 $0 $24,502,065 $19,759,655 Net Present Value $13,968,094 $13,968,094 $0 $9,130,465 $4,837,628 VAY Commonwealth Associates, Inc. Page 63 eigincer -cansnltants construction manayers Table 41 Detailed Case Results Sensitivity #5 Assumptions — Historical Flows W/P=Base/Hist, KPU=Low/Hist KWH Power Deliveries Firm Interruptible Transmission Revenue Total Firm Interruptible | Transmission Transmission Total Net Year W/P <<K W/P >>K W/P >> K W/P >>K Price Price Total Firm Interruptible | Expenses Revenue 2009 0 0 0 0 $0.064 $0.040 $0 $0 $0 $462,449 ($462,449) 2010 0 6,446,971 6,446,971 0 $0.064 $0.040 $412,606 $412,606 $0 $288,570 $124,036 2011 0 = 13,151,331 13,151,331 0 $0.064 $0.040 $841,685 $841,685 $0 $454,181 $387,504 2012 0 361,125 361,125 0 $0.065 $0.041 $23,473 $23,473 $0 $465,536 ($442,063) 2013 0 1,100,468 1,100,468 0 $0.065 $0.041 $71,530 $71,530 $0 $1,481,614 ($1,410,083) 2014 0 2,826,603 2,826,603 0 $0.065 $0.041 $183,729 $183,729 $0 = $511,035 ($327,306) 2015 0 0 0 0 $0.066 $0.042 $0 $0 $0 $501,331 = ($501,331) 2016 0 0 0 0 $0.066 $0.042 $0 $0 $0 $530,505 ($530,505) 2017 0 0 0 0 $0.066 $0.042 $0 $0 $0 $543,768 ($543,768) 2018 0 0 0 0 $0.067 $0.043 $0 $0 $0 $785,993 ($785,993) 2019 0 0 0 0 $0.067 $0.043 $0 $0 $0 = $596,110 = ($596,110) 2020 0 0 0 0 $0.067 $0.043 $0 $0 $0 $585,579 = ($585,579) 2021 0 0 0 0 $0.068 $0.044 $0 $0 $0 $600,218 ($600,218) 2022 0 0 0 0 $0.068 $0.044 $0 $0 $0 $615,224 = ($615,224) 2023 0 9,234,062 9,234,062 0 $0.068 $0.044 $627,916 $627,916 $0 $2,410,898 ($1,782,981) 2024 0 20,477,965 20,477,965 0 $0.069 $0.045 $1,412,980 $1,412,980 $0 $674,443 $738,536 2025 0 = 18,239,413 18,239,413 0 $0.069 $0.045 $1,258,520 — $1,258,520 $0 $662,529 $595,991 2026 0 3,207,618 3,207,618 0 $0.069 $0.045 $221,326 $221,326 $0 $679,092 ($457,766) 2027 0 8,516,546 8,516,546 0 $0.070 $0.046 $596,158 $596,158 $0 $696,069 ($99,911) 2028 0 7,086,739 7,086,739 0 $0.070 $0.046 $496,072 $496,072 $0 $1,006,138 ($510,066) 2029 0 0 0 0 $0.070 $0.046 $0 $0 $0 $763,071 ($763,071) 2030 0 0 0 0 $0.071 $0.047 $0 $0 $0 $749,590 ($749,590) 2031 0 0 0 0 $0.071 $0.047 $0 $0 $0 $768,330 = ($768,330) 2032 0 0 0 0 $0.071 $0.047 $0 $0 $0 $787,538 ($787,538) 2033 0 0 0 0 $0.072 $0.048 $0 $0 $0 $2,453,118 ($2,453,118) 2034 0 0 0 0 $0.072 $0.048 $0 $0 $0 $863,344 = ($863,344) 2035 0 0 0 0 $0.072 $0.048 $0 $0 $0 $848,093 ($848,093) 2036 0 11,846,078 11,846,078 0 $0.073 $0.049 $864,764 $864,764 $0 $869,295 ($4,531) 2037 0 = 23,069,153 23,069,153 0 $0.073 $0.049 — $1,684,048 — $1,684,048 $0 $891,027 $793,021 2038 0 26,578,098 26,578,098 0 $0.073 $0.049 $1,940,201 $1,940,201 $0 $957,378 $982,823 Nominal Values 152,142,173 152,142,173 0 $10,635,008 $10,635,008 $0 $24,502,065 ($13,867,057) Net Present Value $3,483,946 $3,483,946 $0 $9,130,465 ($5,646,519) —_— I Commonwealth Associates, Inc. Page 64 engineers -consuliants -conetruction managers CAy Table 42 Case Results — Extreme Flows Sensitivity #5 Assumptions Nominal Net Revenue-Historic Flows Base/Avg Base/Max Base/Min High/Avg High/Max High/Min XHigh/Avg XHigh/Max XHigh/Min Low/Avg Low/Max Low/Min KPU Load/Generation W/P Load/Generation Base/Max Base/Min High/Max High/Min $6,692,164 ($3,506,336) $4,296,361 ($23,706,028) ($21,128,356) ($21,546,611) ($21,136,734) ($24,502,065) $85,005,228 $7,273,637 $78,246,601 ($20,498,554) $101,275,105 $5,737,563 $79,861,523 ($21,456,660) $67,510,477 ($714,001) $51,865,051 ($23,674,695) $163,065,627 $7,474,749 $129,188,789 ($20,500,446) $113,289,496 $6,478,316 $89,101,467 ($20,957,955) $86,018,836 $951,028 $66,869,419 ($22,775,305) $173,820,291 $6,991,768 — $137,005,391 ($20,665,919) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) $44,565,500 $6,142,461 $43,432,985 ($20,559,234) Net Present Value of Net Revenues Base/Avg Base/Max Base/Min High/Avg High/Max High/Min XHigh/Avg XHigh/Max XHigh/Min Low/Avg Low/Max Low/Min c 3 $s £ vo S o 3 s 3° a > a M Commonwealth Associates, Inc. engineers -cansulants sconstruction manasers W/P Load/Generation Base/Max ($935,329) ($8,507,598) $30,707,390 $29,572,583 $15,150,340 $58,171,667 $35,907,581 $22,501,507 $63,393,637 ($9,130,465) ($9,130,465) $17,541,462 Base/Min High/Max ($3,043,378) ($1,448,587) ($8,581,468) ($8,509,030) $4,246,461 $29,274,390 $2,664,195 $24,412,914 ($1,740,259) $11,786,958 $4,415,968 $49,583,860 $3,590,816 $29,695,884 ($241,298) $18,295,774 $4,167,189 $53,841,288 ($9,130,465) ($9,130,465) ($9,130,465) ($9,130,465) $3,716,888 $17,320,140 High/Min ($8,747,506) ($9,130,465) ($6,124,320) ($7,040,487) ($8,719,569) ($6,088,957) ($6,485,254) ($8,092,921) ($6,212,615) ($9,130,465) ($9,130,465) ($6,202,591) Low/Max Low/Min $6,798,395 $5,957,407 ($21,128,356) ($21,128,356) $85,324,315 $26,822,135 $104,868,272 $24,951,313 $68,604,957 $15,532,538 $169,179,877 $27,408,889 $117,503,777 $25,293,756 $87,726,868 $17,941,649 $180,133,812 $26,701,278 ($24,502,065) ($24,502,065) ($24,502,065) ($24,502,065) $44,603,613 $25,277,179 Low/Max Low/Min ($916,950) ($1,063,485) ($8,507,598) ($8,507,598) $30,766,668 $10,623,737 $30,393,323 $8,662,514 $15,350,883 $2,624,800 $59,650,465 $11,048,982 $37,013,426 $9,575,108 $22,818,640 $4,874,773 $64,965,523 $10,719,572 ($9,130,465) ($9,130,465) $17,547,975 ($9,130,465) ($9,130,465) $9,848,886 Page 65 Conclusions Reviewing all of the study results, CAI offers the following conclusions. 1 Using historical inflows and base case assumptions, the net revenue of the STI over 30 years is positive, as is the net present value. The revenues from providing power to Ketchikan to displace diesel generation are greater than the annual costs of the line. This is true regardless of the assumed load growth in Ketchikan or Wrangell — Petersburg. 2. These positive results do not mean that there will not be individual years or even groups of years in which revenues do not cover annual costs. However, over the 30 years reviewed in this study, the total net revenues were always positive in the base case. 3. There are factors that could mitigate the small number of negative results that occur. If power other than Tyee was wheeled across the STI, wheeling revenues could be used to offset STI annual expenses. If Tyee power not used to serve Ketchikan was exported to British Columbia or the Pacific Northwest, additional revenues would be available to offset STI costs. 4. If the annual revenues must cover debt service as well as annual operations and maintenance, the results are not as positive. In this case, total net revenues and net present values are negative if load growth in Ketchikan is low. Even in cases where the results are positive over the 30 years, there are still individual years or groups of years where revenues do not exceed costs thereby making it difficult to try to cover the additional costs of debt service. 5: If the output of the Ketchikan hydro projects is increased by 14 GWH through either upgrades or new projects and this increased output reduces diesel generation the total net revenues of the STI are negative when Ketchikan load growth is low. 6. If the model is run on extreme flow assumptions where minimum or maximum flows are assumed to occur every year of the 30-year study period, the majority of the results continue to be positive. With these extreme assumptions however, there are from one- third to one-half of the cases that are negative. This means that extreme conditions may influence the economic results of the line, but will not necessarily make the overall results negative. Ts It may be possible to fund renewals and replacements out of a common fund instead of treating them as annual expenses as this study has done. Use of such a fund may reduce the annual expenses and improve the economics of the line. Cay Commonwealth Associates, Inc. Page 66 eAgIeer -consuliants -coostrue ton managers The following formula was used to convert Tyee flows in CFS as shown on Table 5 into kWh to determine energy remaining in the reservoir after serving Wrangell — Petersburg loads. Formula for converting CFS to kWH is (((1233*CFS*0.9)/8.82)*0.975*0.746*Hours) where: the portion in blue is turning CFS into horsepower the portion in red is turning horsepower into kWh 1233 = average assumed head CFS = monthly inflows in CFS 0.9 = turbine efficiency 8.82 = the constant used for turning CFS into HP .975 = the generator efficiency -746 = the constant for converting horsepower to kw Hours are used to turn kw into kWh Using these formulae, it is possible to estimate the generation available given certain levels of inflows. The following Table A-1 estimates the available generation from minimum inflows (assuming minimum inflows as shown in Table 5) as limited by the 22.5 MW turbine capacity. Next, the net base case loads of Wrangell — Petersburg are subtracted to determine the Tyee energy remaining after serving Wrangell — Petersburg. Table A-1 Available Tyee Energy After Serving Wrangell — Petersburg Assuming Minimum Flows Minimum Flows Avail. Energy Min. As Limited | Combined | Combined Net Tyee Energy Flow By Turbine wp w/P W/P__| Remaining After] Month [Hours [CFS kWh 22.5MW__| Base Loads | Generation | Loads__| Serving W/P Jan 744, 11 748,938 748,938 6,080,125) 1,039,808} 5,040,317 Feb 672| 10 614,964 614,964 5,282,206 888,728} 4,393,479) Mar 744 9 612,768 612,768 5;773,719} 923,571) 4,850,148) [Apr 720} 14 922,446 922,446 5,069,829] 901,395| 4,168,434 May 744| 113 7,693,639 7,693,639 4,906,990) 980,193| 3,926,797 Jun 720| 268) 17,658,253 16,200,000 4,660,511) 2,326,501} 2,334,010 Jul 744) 188) 12,800,037 12,800,037 6,109,154) 1,107,948) 5,001,206 Aug 744| 96 6,536,189 6,536,189 7,072,168 944,469) 6,127,699 Sep 720| 97| 6,391,233 6,391,233 5,468,934) 1,045,223} 4,423,711 Oct 744| 148) 10,076,625 10,076,625) 5,164,174, 1,144,567) 4,019,607) Nov 720| 41 2,701,449 2,701,449 5,973,373 891,779) 5,081,594 Dec 744) 29 1,974,474 1,974,474 5,517,439 909,256} 4,608,182 8760 | 68,731,016 67,272,763) 67,078,622) 13,103,438} 53,975,184) 13,297,579) This table tells us that there is enough energy in minimum inflows to serve Wrangell — Petersburg and have 13.3 million kWh left. Table A-2 below goes through the same calculation assuming average inflows. cagineer -consuhants scopstruction managers Page 67 Table A-2 Available Tyee Energy After Serving Wrangell — Petersburg Assuming Average Flows Avail. Energy AverageFlows | 0] Avg. As Limited Combined | Combined Net Tyee Energy Flow By Turbine w/P WwiP wi/P Remaining After} Month [Hours |CFS kWh 22.5 MW Base Loads | Generation Loads Serving W/P Jan 744] 47) 3,200,009 3,200,009] 6,080,125] 1,039,808] 5,040,317 Feb 672| 36) 2,213,871 2,213,871] 5,282,206 888,728) 4,393,479 744| 28) 1,906,389 1,906,389] 5,773,719 923,571] 4,850,148 720| 53) 3,492,117 3,492,117] 5,069,829 901,395] 4,168,434 744) 193) 13,140,464 13,140,464] 4,906,990 980,193} 3,926,797 Jun 720) 350) 23,061,151 16,200,000] 4,660,511] 2,326,501) 2,334,010 Jul 744| 293) 19,948,994 16,740,000] 6,109,154] 1,107,948] 5,001,206 Aug” 744| 238) 16,204,302 16,204,302] 7,072,168 944,469] 6,127,699 Sep 720| 218] 14,363,803 14,363,803] 5,468,934] 1,045,223] 4,423,711 Oct 744| 275| 18,723,459 16,740,000] 5,164,174] 1,144,567| 4,019,607 720| 113) 7,445,457 7,445,457| 5,973,373 891,779| 5,081,594 744| 76) 5,174,483 5,174,483] 5,517,439 909,256] 4,608,182 128,874,499] 116,820,895] 67,078,622) 13,103,438] 53,975,184] 62,845,711] Assuming average inflows, there is enough energy in Tyee to serve Wrangell — Petersburg and have 62.8 million kWh leftover. Table A-3 goes through the same calculation assuming maximum inflows. CAy Commonwealth Associates, Inc. engineees -consuliints «construction managers Page 68 Table A-3 Available Tyee Energy After Serving Wrangell — Petersburg Assuming Maximum Flows Maximum Flows _| Avail. Energy Max. As Limited Combined | Combined Net Tyee Energy Flow | By Turbine w/P wre Ww/P Remaining After] 22.5 MW Base Loads | Generation Loads Serving W/P Jan 744| 168 11,438,331 11,438,331 6,080,125} 1,039,808} 5,040,317 Feb 672| 122 7,502,561 7,502,561 5,282,206 888,728} 4,393,479 Mar 744) 81 5,514,910 5,514,910 5,773,719 923,571) 4,850,148 Apr 720; 88 5,798,232 5,798,232 5,069,829 901,395) 4,168,434 May 744| 338 23,012,833 16,740,000 4,906,990 980,193} 3,926,797 Jun 720| 464 30,572,498 16,200,000 4,660,511} 2,326,501) 2,334,010 744| 414) 28,187,316 16,740,000 6,109,154} 1,107,948) 5,001,206 Aug 744) 350| 23,829,856 16,740,000 7,072,168 944,469} 6,127,699 720| 392) 25,828,489 16,200,000 5,468,934) 1,045,223) 4,423,711 Oct 744) 598 40,715,012 16,740,000 5,164,174) 1,144,567) 4,019,607 (Nov 720| 322| 21,216,259 16,200,000 5,973,373 891,779| 5,081,594 Dec 744) 218) 14,842,596 14,842,596 5,517,439 909,256) 4,608,182 The calculation in all the above tables include only the energy coming from inflows, they do not include the energy from water already in the reservoir. When full, the reservoir holds enough water to generate approximately 58 million kWh. Therefore, that amount of energy could be added to the above calculations if it is assumed the reservoir starts out full. Cay Commonwealth Associates, Inc. engineer -consultants -comstruction managers Page 69 — Net Revenue and Net Pre nt Value Results For All Cases Nominal Net Revenues For All Cases Table B-1 Nominal Net Revenue — All Cases Cay Base Case W/P Load/Generation Base/Hist High/Hist Low/Hist g |Base/Hist $42,877,000 $16,248,340 $47,770,936 S |High/Hist $81,781,467 $32,811,827 $96,702,222 © |Xhigh/Hist $87,725,495 $37,311,023 $103,807,077 % |Low/Hist $10,529,541 $10,529,541 $11,610,536 Sensitivity #2 Base/Hist High/Hist Low/Hist 3 Base/Hist $47,398,077 $25,398,251 $51,938,131 © |High/Hist $98,693,404 $51,513,775 $110,714,798 ® |Xhigh/Hist $106,909,412 $57,490,256 $121,546,125 % |Low/Hist $12,560,466 $12,560,466 $13,702,908 Sensitivity #4 Base/Hist High/Hist Low/Hist g Base/Hist $28,838,657 $8,007,941 $33,135,070 © |High/Hist $77,310,722 $32,657,457 $88,689,180 = |Xhigh/Hist $85,617,093 $38,636,663 $99,541,934 M JLow/Hist ($4,106,325) ($4,106,325) ($3,025,330) Commonwealth Associates, Inc. engineer «consultants -construction managers Sensitivity #1 W/P Load/Generation Base/Hist High/Hist Low/Hist g Base/Hist $42,198,339 $22,323,484 $46,340,249 © |High/Hist $90,193,808 $47,245,627 $101,123,729 & |Xhigh/Hist $98,643,299 $53,316,003 $112,100,930 % |Low/Hist $10,023,659 $10,023,659 $11,068,266 Sensitivity #3 Base/Hist High/Hist Low/Hist g Base/Hist $34,668,392 $16,771,315 $38,273,833 O |High/Hist $76,467,745 $38,487,898 $86,157,520 © |Xhigh/Hist $85,358,761 $44,780,729 $97,352,896 < |Low/Hist $6,374,177 $6,374,177 $7,310,945 Sensitivity #5 Base/Hist High/Hist Low/Hist g Base/Hist $19,759,655 $6,517,641 $21,569,720 © |High/Hist $78,944,586 $40,435,510 $88,846,714 = |Xhigh/Hist $90,190,856 $46,693,414 $102,351,633 ™ |Low/Hist ($13,867,057) ($13,867,057) ($13,829,897) Page 70 Net Present Values For All Cases Table B-1 Net Present Values For All Cases Base Case W/P Load/Generation Base/Hist High/Hist Low/Hist 2 |Base/Hist $15,114,729 $8,669,390 $16,435,511 5 High/Hist $31,349,347 $17,710,471 $35,442,524 > |Xhigh/Hist $35,271,501 $20,812,787 $39,830,960 gz Low/Hist $4,257,705 $4,257,705 $4,578,404 Sensitivity #2 Base/Hist High/Hist Low/Hist % |Base/Hist $16,684,842 $11,224,477 $17,940,070 S |High/Hist $36,536,178 $23,646,949 $39,762,106 = |Xhigh/Hist $41,365,867 $27,590,681 $45,496,554 ™ |Low/Hist $5,052,338 $5,052,338 $5,391,668 Sensitivity #4 W/P Load/Generation Base/Hist High/Hist Low/Hist Base/Hist $7,583,645 $2,416,208 $8,770,988 High/Hist $26,327,199 $14,135,285 $29,378,771 Xhigh/Hist $31,157,214 $18,055,960 $35,089,240 Low/Hist ($3,406,818) ($3,406,818) ($3,086,119) KPU Case Cay Commonwealth Associates, Inc. cagincers -consultants -construction managers Sensitivity #1 W/P Load/Generation Base/Hist High/Hist Low/Hist % |Base/Hist $15,292,985 $10,313,225 $16,447,044 S |High/Hist $34,125,284 $22,270,930 $37,089,341 > |Xhigh/Hist $39,012,249 $26,234,524 $42,851,841 Z Low/Hist $4,378,290 $4,378,290 $4,695,012 Sensitivity #3 Base/Hist High/Hist Low/Hist 9 |Base/Hist $12,730,066 $8,323,668 $13,717,507 5 High/Hist $29,323,152 $19,021,771 $31,905,324 ® |Xhigh/Hist $34,343,686 $23,055,243 $37,721,461 < |Low/Hist $3,139,798 $3,139,798 $3,420,004 Sensitivity #5 Base/Hist High/Hist Low/Hist 2 Base/Hist $4,837,628 $1,632,577 $5,254,705 © |High/Hist $27,137,894 $17,409,852 $29,641,035 ® |Xhigh/Hist $33,091,349 $21,541,741 $36,252,614 % |Low/Hist ($5,646,519) ($5,646,519) ($5,639,820) Page 71