HomeMy WebLinkAboutBethel Area Power Plan; Findings & Recommendations 1985
Alaska Power Authority
Findings and
Recommendations
Bethel Area Power Plan
December 20,1985
Be TH Ek AREA POWER PLAN
FINDINGS & RECOMMENDATIONS
December 20, 1985
1916/485(1)
EXECUTIVE SUMMARY
The Bethel Power Plan analyzes alternative sources and/or
configurations of electrical energy generation in the Bethel
Region. Presently, Bethel and all of the twelve surrounding
villages use diesel generation for their needs. Beyond just the
economic hardship that diesel power plant costs have on consumers,
a number of other conditions are also commonly found:
- Vacillating diesel fuel costs which limits reliability of
economic comparisons for alternative generating sources.
- Varying degrees of skill among village personnel in the
maintenance of independent power systems.
- Problems with voltage and frequency fluctuations.
- Safety issues from poorly regulated installation of
generation and distribution facilities.
These conditions and the tentative nature of subsidies for
electrical use necessitates a solution. Previous investigations
have, therefore, grouped these common concerns by region in an
attempt to develop comprehensive power supply plans.
The Alaska Power Authority staff has conducted an analysis of
several different power sources and different configurations of
power centralization for the Bethel region. First, continuing to
utilize diesel generation, distribution line interties were
proposed to link Bethel to other villages. Next, two sizes of
hydroelectric projects and two sizes of coal-fired steam plants
using a Regional intertie system for distribution were evaluated.
The continuation and centralization of diesel generation in Bethel
appears to be the most viable near term option. Bethel has the
largest organized utility in the Region with the capacity to serve
the Regional electrical load and is also centrally located among the villages. The more capital intensive projects such as coal and
hydroelectric generation have a much higher present worth cost over
the length of the study period than diesel generation with intertie(s).
In the long term, it is recommended that the applicability of the
use of coal in the Bethel Region be periodically evaluated. The
viability of this option will be sensitive to cost of coal and its
BTU content and should be investigated in the context of
development of the Deadfall Syncline project near Cape Beaufort or
other indigenous coal mining projects.
1916/485(2)
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1.0 INTRODUCTION
The purpose of this study is to determine the most economic
electrical energy supply plan for the Bethel Region. The
Region consists of Bethel and twelve surrounding villages:
Atmaut]auk Napakiak
Napaskiak Oscarville
Tuluksak Tuntutuliak
Kasigluk Nunapitchuk
Akiachak Kwethluk
Eek Akiak
At the present time, all of the villages meet their electrical
energy needs through diesel generation in the individual
village--except Kasigluk which receives electrical power
through an intertie to Nunapitchuk, and Napakiak which is
intertied to Bethel. A combination of escalating diesel fuel
prices in the early 1980's and evidence of poor quality of
electrical service and dependability prompted a search for
feasible alternatives or improvements to the existing diesel
electric generation.
Under Alaska Power Authority's direction, Harza Engineering
Produced a draft preliminary feasibility report for a Bethel
Power Plan in December 1982. Profiles of each village in the
Bethel Region were formulated to provide data on historical
and projected energy consumption, to review energy sources to
meet those energy needs, to review corresponding environmental
concerns and economic analyses, to determine public reaction
to proposed solutions, and to make recommendations for the
most viable plan.
The consultant ultimately developed 10 hypothetical
alternative cases to the Base Case, which is the continuation
of diesel generation in the villages. The Base Case provides
the control for costs which all other cases are compared
against in the economic analysis. An Optimized Base Case was
constructed utilizing diesel generated electricity augmented
by wind turbines, waste heat recovery from diesel electric
plants for space heating of larger centralized buildings, with
direct coal combustion for residential space heating.
Among the other base case alternatives developed were the Lake
Chikuminuk Hydroelectric Projects of two different sizes (9.5
MW, and 24 MW), and five different thermal options with
differing configurations. Table 1 provides a comprehensive
list of the options studied.
1916/485(3)
TABLE 1
Bethel Area Power Supply Options from Harza
Title
Base Case
Optimized Base Case!
Thermal Alternatives:
4 MW Base Load Plant
4 MW Plant w/Waste
Recovery
10 MW Plant
10 MW Plant w/Waste
Heat Recovery
10 MW Plant w/Waste
Heat Recovery &
Supplementary Boiler
Hydroelectric Alternatives:
9.5 MW Chikuminuk
Lake Project
24 MW Chikuminuk Lake
Project
Fuel Cell Alternatives:
9.0 MW Fuel Cell Plant
9.0 MW Fuel Cell Plant
w/ Waste Heat Recovery
1
Basic Components
Diesel generation with normal
retirement & replacement of
equipment. Continued use of fuel oil
for space heat.
Diesel generation with waste heat
recovery, wind turbines used in
conjunction w/varying configurations
of interties.
A straight condensing coal-fired
steam plant augmented by diesel
generators for peaking.
25% of heat level to be met.
A straight condensing coal-fired
steam plant to meet total electric
energy demand.
62% of heat load to be met.
80% of heat load to be met.
60 GWH per year energy production
with 7% surplus for space heating.
120 GWH per year energy production
with 27% surplus for space heating.
Phosphoric acid electrolyte type
using propane as a fuel source.
12% of heat load to be met.
the optimized base case and all other alternatives assumed
the use of coal direct combustion for space heating needs
not met by cogeneration.
1916/485(4)
Other alternative sources of energy production (peat, solar,
wood, geothermal, and natural gas) were discarded due to
inadequate availability of relevant resource data, absence of
commercially available technologies, cost considerations, or
absence of an_ infrastructure for harvesting and/or
distribution of the resource. Additionally, a total of twelve
hydroelectric sites received reconnaissance level assessment including three sites along the Kisaralik River (Exhibit 2).
Contrary to earlier reconnaissance work performed by
Retherford & Associates, the Kisaralik sites were ultimately
abandoned in favor of Chikuminuk Lake on the basis of lowest
unit cost for the highest installed capacity (Exhibit 3).
The consultant's chosen power sources were compared within
varying intertie configurations--regional and subregional. A
present worth analysis was done through the last year of
economic life of the hydro projects (50 years) and a
benefit/cost study completed. The consultant concluded that
the Chikuminuk Lake hydroelectric projects were the most
feasible because they had the highest benefit/cost ratios in
relation to the base case. It should be noted that none of
the alternatives presented benefits to cost sufficient to
justify further feasibility studies for any single case to the
exclusion of others.
Concerns regarding the report and its proposed scenarios led
to additional study by APA staff. These concerns included:
° building a $200 million dollar hydro project (Lake
Chikuminuk 24 MW) to serve approximately 7000 people
at a time when oil prices and state and federal
revenues are declining.
use of the excess energy from the 24MW Lake
Chikuminuk Project for space heating without
sufficient information concerning primary and
secondary distribution systems.
° lack of confidence in both the design criteria and
cost estimates for the interties
the absence of complete sensitivity analyses to
variations in fuel prices and BTU values for coal;
° lack of confidence in the design criteria for the
9MW Chikuminik project to overcome line losses and
still meet the load.
° the absence of consideration for retirement cost of
the privately owned Bethel Utility
1916/485(5)
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EXHIBIT 2
VICINITY MAP
NOTE:
Base mapping prepared by the
Arctic Environmental information
and Data Center, University of Alaska.
° 20 40
SCALE IN MILES
(1: 1,000,000)
ALASKA POWER AUTHORITY
tq BETHEL AREA POWER PLAN
FEASIBILITY ASSESSMENT
LOCATION MAP
POTENTIAL HYDROELECTRIC SITES
ENGINE!
COMPANY
December 1982
EXHIBIT 3
Eee
UPNUK LAKE LIK RIVER | (UPPER FALLS) —| ine T WT,
KISARALIK RIVER
(GOLDEN GATE FALLS) ! ECONOMIC COST — CENTS / KWH
KISARALIK BIVER
(LOWER FALLS)
CHIKUMINUK LAKE
30 4 36 38
REGIONAL ENERGY REQUIREMENT SUPPLIED — MWh x 102
BETHEL AREA POWER PLAN
FEASIBILITY ASSESSMENT
ANNUAL ECONOMIC COST
OF AVERAGE ENERGY
December 1982
2.0 SCOPE OF ANALYSIS
3.0
The Power Authority analysis investigated a variety of
configurations for linking the villages and their power
supplies. Also, different types of power sources were
evaluated for their applicability in the Bethel Region. The
centralized power sources were variations of power projects
developed by the consultant with the exception that waste heat
components were not considered. It was assumed that heat
credits would be approximately equal for comparative sizes of
the thermal options.
Cost and dependability are the major concerns in developing a
long term electrical supply plan for the Bethel Region.
Electrical costs in all of the villages except Oscarville are
now subsidized by the State of Alaska Power Cost Equalization
Program. In addition, many of the villages have received
grants and low cost loans to update and replace their generation systems. Three villages are served by the Alaska
Village Electric Cooperative which borrows funds from the
Rural Electricification Administration and provides energy
based on a pooled rate for its thirty odd member villages.
The 1985 cost of diesel fuel delivered to the various villages
averages $1.24 per gallon. The diesel efficiency rate of
village generation systems ranges from 4-10 KWH per gallon, at
Bethel from 12-13 KWH per gallon. The wholesale bulk cost of
power at Bethel is 13¢ per KWH at the busbar and the average
cost to a Bethel Utility customer is approximately 20¢ per KWH
after fuel surcharges. Wholesale cost to Napakiak across the
single wire ground return line is 17¢ per KWH. The average
cost per KWH in the villages is 40 to 50¢ per KWH.
Efficiencies of scale achieved through a_ centralized
generation source in Bethel would appear to be attractive for the Region. Examination of costs associated with intertie
construction and operation and maintenance of the interties
and secondary distribution lines require a high level of
reliability to support this strategy.
PROJECT DESCRIPTIONS
This analysis is centered on electric energy generation needs for the Bethel Region. The analysis utilizes real 1985
dollars. The study period encompasses the years 1986 through
2041--the last year of the economic life of the hydroelectric
option. APA's economic analysis includes an te diesel
base case, two project sizes of a thermal (coal) option, and
two project sizes of the Lake Chikuminuk option, all chosen
for comparison with the Base Case.
1916/485(6) ~*
Due to the intermittent nature of wind generated electricity,
the absence of proven methods of system integration, and
problems related to comparative fuel cost savings from diesel
displacement, wind turbines were not considered in the
economic analysis. Fuel cell options were also not evaluated,
because they are not expected to be commercially available
until the mid 1990's.
3.1 Diesel Base Case
The diesel base case is the actual situation in the
villages carried through the study period. The majority
of the villages provide their own electricity through
diesel generators in place in the villages. The Lower
Kuskokwim School District (LKSD) also has generators in
place in most of the villages, either in a primary or
standby capacity due to the lack of dependability of the
village power resources.
TABLE 2 Electric Generation Profiles
Utility
Capacity LKSD BIA Peak* Eneray Village Utility (KW) Capacity Site KW) (MVIH)
Akiachak Akiachak 785 175 Prime 165 124 451 Ltd. Akiak Kokarmuit 250 250 Prime 65 279 Corp. Atmautluak Atmautluak 430 305 Standby 70 470
Ust: Cethel Bethel 9,400 4,600 25,000** Util.
Eek AVEC 300 75 Standby 108 374 I See Kasigluk AVEC Intertie 105 Standby 135 146 = Nanapitchuk Kwethluk Kwethluk 500 125 Standby 155 108 831 Inc.
Napakiak Napakiak- Intertie 150 140 See Bethel Ircinraq Napaskiak Napaskiak 260 75 Prime 65 92 396 Inc.
Nunapitchuk AVEC 875 75 Standby 135 86 Mey] Oscarville Unorganized 130 65 Prime 22 123 Tuluksak Tulkisarmute 155 170 Prime 125 81 306 Inc.
Tuntutuliak Tuntutaliak 325 175 Standby 75 59 534 Inc.
* Estimate from Harza 1982
** Includes Napakiak
1916/485(7)
Bethel provides power for itself and Napakiak through a single wire ground return (SWGR) transmission line;
Kasigluk receives power through an AVEC tie line from
Nunapitchuk. Replacement and additions to existing
capacity would occur when load growth or economic life
warranted. The base case provides the standard for
comparison for all of the alternative options' costs in
the present worth analysis--the process through which all
of the costs for each alternative over the study period
are discounted back to 1985 dollars. In the present
worth ratio analysis, the base case value is 1.0 or the
break even point for comparison of any alternative. If
the value is greater than 1, then the alternative is
considered a potentially acceptable project; if the value
is less than 1, the project is considered unacceptable.
3.2 Expanded Diesel Case
The first hypothetical case is the expanded diesel case
which features the continuation of diesel generation with
various configurations of interties linking Bethel and
selected villages (Exhibit 4). Bethel presently is the
largest generation facility in the Region with an
installed capacity of 9.4 MW and peaks in the range of
4.5-4.8 MW. With some additional capacity, it has the
capability of meeting the load requirements of the
village network in addition to servicing its own load and
that of Napakiak. Annual electrical energy demand for
the twelve villages is estimated at 3 GWH with peak
demand at 845 KW.
Bethel is the generation center for all of the selected
interties for the study. The existing diesel generation
facilities in Bethel include four 2100 KW and one 1000 KW
generators. 1984 electrical production was 24.8 GWH or
approximately 2831 KW average load. Night time loads
generally remain at about the average for the winter
months.
Bethel's central location in relation to the other
villages would also reduce the capital costs of linking
the villages. The proposed Regional intertie links all
12 outlying villages to Bethel. The smaller intertie
options are (1) Bethel to Oscarville or Bethel to
Oscarville and Napaskiak, (2) Bethel to Athmautlauk,
Nunapitchuk, and Kasigluk, and (3) Bethel to Akiachak and
Akiak or Bethel to Akiachak, Akiak, and Kwethluk.
1916/485(9)
EXHIBIT 4
NAPAKIAK JUNCTION
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TULUKSAK
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es et eteneeng
we mo TULUKSAK JUNCTION
ALASKA POWER AUTHORITY
BETHEL AREA POWER PLAN
FEASIBILITY ASSESSMENT
INTERTIE TRANSMISSION SYSTEM P.E. COMPANY SCALE 0 10 20 MILES Ly | 4 J
1” =6 MILES
December 1982
TABLE 3
Distribution Interties from Bethel
Length
Village (Miles)
Bethel To:
Oscarville 4.65
Oscarville To:
Napaskiak 125
Bethel To:
Atmautluak 26.06
Atmautluak Jkt. To:
Nunapitchuk 5.3)
Bethel To:
Akiachak 15.62
Akiachak To:
Akiak Told
Akiachak To:
Kwethluk 7.58
1916/485(10)
River
Crossings
Length & Method —Of Crossing _
-5 Miles Kuskokwim
Submarine Cable
320' Kongeruk River
Overhead
790' Johnson River
Submarine Cable
530' Johnson River
Overhead
635' Kuskokwim
Submarine Cable
1050' Kuskokwim
Submarine Cable
792' Kuskokwim
Overhead
250' Kwethluk Slough
Overhead
These villages were chosen for the intertie study because
of their proximity to Bethel and size of loads required
to justify the capital cost investment. Segments with
and without river crossings were selected, because of
uncertainty of exact cost figures for such crossings and
to demonstrate the effect of the cost of river crossings
versus the amount of load.
The transmission interties consist of 34.5 kv, three
Phase lines to ensure that the school loads will be
serviced. Overhead lines would be supported by 40 foot
embedded wood poles. River crossing design would vary
according to span length and height requirements.
Navigable waterways would require 75 foot, class 3 poles
in H frame structures for clearances up to 40 feet above
water level. Where 40 foot clearance is not sufficient or
whenever physical conditions permit, submarine cable is
proposed. Construction completion of an_ intertie
alternative was estimated to be one building season so
that a project on line date is 1987 for the first
segment.
Problems affecting the construction and costs of an
intertie system between the villages and Bethel are
numerous but are technically manageable within the
framework of local support for the concept and of local,
state, and federal coordination in providing
rights-of-way for its implementation. Specific concerns
which would require further consideration in a
feasibility level study include:
1. Kuskokwim River Crossings. The Kuskokwim is
Navigable by barge from its mouth to McGrath. Barge
container heights can reach 24 feet, draft 10 feet
and booms 30 feet. Assuming that 40 feet is the
maximum achievable clearance (after sag) from 75
foot poles, submarine cable is recommended. Design
consideration will include bank stability, ice
conditions, protection from anchors and dredging,
and redundancy requirements for dependability.
2. Ice lenses and innumerable lakes in the terrain.
The state has experimented with two lines using
gravity-stabilized A frame structures. Both
facilities have demonstrated design deficiencies and
cost on the magnitude of conventional designs.
While the theory behind gravity type structures is
attractive, a conventional embedded pole with minor
modifications is envisioned.
3. Ownership, operations and maintenance. Currently,
the privately owne ethel Utility is the only
entity capable of providing the local infrastructure
1916/485(11)
for management of an comprehensive intertie system. A subregional cooperative utility has never been previously discussed but would provide an ideal
institutional entity to resolve the issue. Villages
would loose local powerhouse operators to a more
centralized, Bethel based utility. In the absence of this type of infrastructure, other
pre-construction arrangements are essential so that
institutional responsibilities keep pace with
electrical distribution facilities.
4. Comprehensive R.O.W. Easements Agencies affected include:
Bureau of Indian Affairs - Native allotments
U.S. Fish & Wildlife Service - game refuge areas &
allotments
Bureau of Land Management - federal holdings &
allotments
Department of Natural Resources - State lands
Department of Transportation & Public Facilities -
State lands
Village Corporations - Native holdings
The widely scattered system layout will require a
comprehensive rights-of-way strategy to promote
cooperative project implementations.
It is important to note that the villages located within
the region are highly scattered with average loads below
100 KW in many cases. The cost of integrating more
distant, isolated communities rises significantly.
3.3 Lake Chikuminuk Hydroelectric Cases
The next proposed cases are the Lake Chikuminuk Hydroelectric Projects (9.5 and 24 MW capacity) which
would be located approximately 130 miles southeast of
Bethel on the Allen River near the outlet of Lake
Chikuminuk. The projects would be connected via a 138 KV
transmission line to a new Bethel substation which would
step the power down to 34.5 KV for distri-
bution.
The 9.5 MW project would have a rated net head of 85
feet, normal maximum reservoir elevation of 610 feet,
with a dependable capacity of 9 MW at a minimum head of
80 feet. The average annual energy production would be 60 Gigawatt hours Tou). with 39 GWH of firm annual
energy.
The 24 MW project would have a rated head of 126 feet
capable of producing 113.5 GWH on a firm basis and an
average annual energy production of 120 GWH.
1916/485(12)
3.4 Thermal Options
The thermal cases chosen for analysis were the 4 MW and
the 10 MW coal fired turbine plant. Each plant was
assumed to be situated on the bank of the Kuskokwim River
at Bethel. The 4 MW plant would provide a peak of 4000 KW of which approximately 3500 KW would be available for
distribution. The 10 MW plant would provide a maximum
peak of 10,000 KW of which 9000 would be available for
distribution.
4.0 ANALYSIS DATA
The Power Authority analysis is based on the following
assumptions. Data utilized from the Harza_ preliminary
feasibility study is noted.
4.1 Analysis Parameters
Load Information - "Load" refers to the electrical
generation consumption, in entirety, for each village.
These figures were derived from Power Cost Equalization
data and from the Lower Kuskokwim School District records
for the period 7/84-6/85. Using a year's consumption
data encompasses all of the seasonal variations in
demand.
Akiachak 451,196 Kwh
Akiak 279,313 Kwh
Athmaut1auk 470,046 Kwh Bethel /Napakiak , 24,769,626 Kwh
Eek 373,489 Kwh
Kasigluk/Nunapitchuk 1,372,887 Kwh Kwethluk 831,381 Kwh
Napaskiak 396,125 Kwh
Oscarville 122,998 Kwh
Tuluksak 306,109 Kwh
Tuntutul jak 533,741 Kwh
Total Regional Load 25,906,911 kwh
Load Growth - 1.5% through 2002. The consultant
projected the most likely average annual Bethel Region
load growth rate as 2.1% through 2022. This figure was
developed in 1982 when oil prices were higher and,
reciprocally, state revenue projections were
correspondingly high. Now with decreasing state oil
revenues and decreasing federal program investment in
Bush projects, growth is estimated to be more
conservative as villages shoulder more of the burden of
constructing capital projects. In addition, population
growth in the Region is projected to remain at a low rate
of increase.
1916/485(13)
Power Authority guidelines for economic analysis include:
- The fuel escalation rate is projected to be -4% for 1985, 0% for two years, then 2% for 17 years.
- Cost of debt is 9%
- Real discount rate is 3.5%
- Inflation is held to 0 for purposes of the economic
analysis
- Economic Life of projects:
°
4.2 Cost Data
4.2.1
4.2.2
1916/485(14)
50 Years 20 Years (Primary) 30 Years (Standby)
25 Years
25 Years
Hydroelectric
Diesel Generator uu Coal Plant
Transmission Line
Diesel - Installed cost per KW: $750 in the villages $800 in Bethel
0&M - $0.054 per Kwh
Standby (secondary) capacity cost - $0.10 *
load (KWH). This cost represents the cost of
maintaining equipment e.g. diesel generators
which must be maintained in the event of
project downtime, which is estimated at 5%.
Interties
Overhead 40 foot wood pole*
Material & Labor $63 ,968
Overhead & Profit @ 25% 12,794
Right-Of-Way 2,000 per mile
Engineering @ 6% 3,838
Contingency @15% 9,595
Submarine Cable : $39 per foot for three phase**
* APA modification of Harza's estimate
** APA data from Diversified Constructors '84
costs estimate for Tyee-Kake intertie.
0&M costs estimated at $1000 per mile per year. Terminal costs are $5886 at Bethel and $19,426
4.2.3
4.2.4
1916/485(15)
at the villages. (Taken from Retherford
— Single Wire Ground Return Report,
1982
Regional intertie cost of construction - $16,946,384. O&M - $201,590 annual.
Lake Chikuminuk Hydroelectric Projects
9.5 MW Project:
Construction Cost - $152,549,913 (per
Harza Engineering)
0&M - $469,980
24 MW Project: Construction Cost - $209,764,264 (per
Harza Engineering) O&M - $766,515
Note: Costs for construction and 0&M included
here cover only generation and transmission of
the power to Bethel and do not include the
costs of distribution to the Region. Therefore
the costs of the Regional intertie must be
included to provide a complete picture of
project costs.
Coal-Fired Steam Turbine Plant
O&M - Fixed component $62.70/Kw/Yr
- Variable component $4.32/Mwh
Price of coal utilized is $140.00 per ton
delivered to Bethel (Cape Beaufort coal per
the consultant). Nominal BTU values are 13,000
per pound.
The coal price is escalated at an average
annual rate of 1.5%.
The coal efficiency rate used was 7618 KWH/ton.
This figure is subject to further losses due to
plant efficiency rates.
4 MW Project:
Construction Cost - $17,648,868 (per
Harza)
O&M - $447,944
10 MW Project:
Construction Cost - $38,503,671 (per
Harza)
O&M - $995,432
Note: Above construction costs only include
those relative to power at Bethel. Full cost
profiles for the region must include the distribution intertie.
4.3 Present Worth Analysis
The following table is an illustration of the present
worth of the base case costs in relation to selected
proposed alternatives and the associated present worth
ratios. Benefits of waste heat are not included in the
present worth values. The diesel base case, the diesel
intertie and coal scenarios would benefit as a result of
waste heat capture. The hydroelectric cases would not as
there is no heat production with hydro power generation
without implementation of a sophisticated load management
program.
TABLE 4
COST OF ELECTRICAL ENERGY SUPPLY $1985
(1986-2041)
Regional
Base Case Intertie
Construction Cost 18,975 ,878
Present Worth* 157,585 ,808 192,336,286 Present Worth Ratio -82
Sub-Regional Interties
Akiachak Athmaut.lauk Oscarville Akiak Nunapitchuk Akiachak Oscarville Napaskiak Kwethluk Kasigluk Akiak
499,421 846,013 3,250 ,002 3,252,307 2,358 ,420 159,085 ,388 159,690,713 161,108,189 161,725,159 164 ,036 ,808 99 99 .98 97 96
Coal Fired Steam Plant
4M LOMW
Construction Cost 36 ,624 ,746 57,479,549
Present Worth* 195,167,043 247 ,460 ,17
Present Worth Ratio 81 +64
Lake Chikuminuk Hydroelectric Project 9. SMW 24MW
Construction Cost 171,525,791 228 739,142
Present Worth* 410,952 ,298 $12 643,449
Present Worth Ratio 38 sil
. Al’ Project Costs
1916/485(16)
The alternatives are ranked in order of their present
worth ratio (present worth cost of the base case divided by present worth cost of the alternative). All the
coal-fired steam turbine cases and the Lake Chikuminuk
cases are more capital intensive and have present worths
much greater than the Base Case; therefore, their ratios
fall below 1.0 by substantial margins. The intertie
options, except for the Regional intertie, all cluster at
1.0. the project alternative break-even value.
The price of fuel has the greatest effect on the outcome
of the present worth analysis. A sensitivity analysis
was performed increasing the escalation rate of the price
of fuel to 0% for the first 3 years, then 3.5% for the
next 17 years. It would be expected that the diesel
alternative cases would be more attractive. Although the
present worth of the base case increased 17%, the present
worth ratios of the alternatives were affected minimally,
and the order of the above rankings was retained.
5.0 CONCLUSION
An economic energy source for the Bethel Region appears to lie
neither in the coal-fired steam plant nor the Lake Chikuminuk
hydroelectric options. Further, APA analysis of Harza's Lake
Chikuminuk project designs revealed that the 9.5 MW project
had insufficient capacity to meet the load requirements of the
Bethel Region due to significant line losses. The 24 MW
project, at an approximate cost of $33,000 per capita in the
Region, may also suffer from design problems in power
transmission. These conditions result from characteristics
inherent in a transmission and distribution system which is
too long for the amount of load being served.
- Line losses on the order of thirty percent were
calculated due to excessive charging current relative to
the light loads.
- Balancing the load and maintaining proper voltages would
require sophisticated and costly monitoring and control
equipment to ensure safe and reliable operation of the
transmission and distribution network.
No redundancies or loops were incorporated in the consultant's
design and no roadways for operation and maintenance would
exist.
A more direct solution to a dependable, less costly source of
electrical generation appears to be in an alternative under
the expanded base case options. In the short term, the
intertie(s) would allow for greater economies of scale, less
duplication of generation in the village--separate generation
for school and village--and more dependable electricity.
1916/485(17)
Because cost estimates and routing distances utilized for the
Power Authority analysis were extremely conservative, it ts
felt that sufficient justification exists to perform more
detailed site reconnaissance to refine the cost data and to
develop a conceptual design specific to the needs and
conditions of the Bethel region.
Although the coal-fired steam plant has a high present worth
cost in relation to the base case, the use of coal in the
Region should not be dismissed summarily. The extensive coal
resources in Alaska are the subject of increasing interest and
study. At present, Arctic Slope Engineering, under contract
to the Alaska Federation of Natives, is engaged in a
development study of the Deadtall Syncline near Cape Beaufort
for use in Western Alaska, including the Bethel Region. If
the demand for coal were greatly increased, as it would be if
all space heating in the villages were converted to direct
coal combustion and a coal-fired steam plant were built, then
the price of coal would most likely drop markedly. For
instance, Arctic Slope Engineering's current analysis
indicates that an FOB Bethel coal cost might be $127 per ton
at 13,000 BTU per pound.
There is a lack of definitive information and commitment at
this time to the use of coal. A long term goal for the Bethel
Region might be to determine the cost and availability of coal
and the viability of such a plan. Since there is no
established infrastructure for the delivery of coal to the
Bethel Region, its viability as an economic option for energy
generation is highly speculative. Harza's analysis of present
worth for space heating supply showed a 30 percent reduction
from the base case through the immediate conversion to direct
coal combustion. This assumed a_ residential furnace
replacement cost of $1200 per household, several hundred
dollars per year for O&M and a delivered cost of $140/ton at
10,000 BTU per pound nominal values. Financing options were
not addressed in the report.
If an intertie system were in place, the utilization of coal
tor electrical generation would promote greater advantage of
economies of scale than the diesel/intertie alternative with
only coal-fired space heating.
1916/485(18)
B.
APPENDIX A
BETHEL REGION POWER PLAN
Action Item
Consideration of the findings for the Bethel Region Power Plan and a recommendation to proceed with a preliminary plan of finance and design. The results of the study indicate that continued diesel generation with Bethel as the generation center and various configurations of interties is the most economic alternative for long term dependable electrical energy for the Bethel Region.
Background
Harza Engineering produced a draft preliminary feasibility
study for the Bethel Region Power Plan in 1982. Harza
recommended a 9.5 MW and a 24 MW Lake Chikuminuk Hydroelectric
Project as the two most economic projects (the highest benefit/cost ratio). Further analysis by the Power Authority staff was done because of a concern over the original report recommendations in light of changing local conditions. The
staff analysis shows that the 9.5 MW and 24 MW projects involved transmission and distribution designs that were too Jong for the amount of load served. In each case, significant operating problems may occur resulting in the need for costly monitoring and control equipment. Line losses were excessive in all of the modified cases developed in the Power Authority analysis. -
Two thermal options were the next most economic projects.
Since there are no major projects in Alaska currently fueled by coal, and there is no coal delivery available to Bethel, cost estimates are highly speculative. With the promising
reports of coal resources in Alaska, however, the possibility of future coal generation should not be ruled out.
The following table illustrates the results of the Alaska Power Authority's economic analysis of the diesel base case and alternatives for supplying electrical power to the Bethel Region:
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TABLE 4
COST OF ELECTRICAL ENERGY SUPPLY
$1985
(1986-2041)
Regional
Base Case Intertie
Construction Cost 18 ,975 ,878
Present Worth* 157,585 ,808 192 ,336 ,286
Present Worth Ratio -82
Sub-Regional Interties
Akiachak Athmaut]auk
Oscarville Akiak Nunapitchuk
Oscarville Napaskiak Kweth tuk Kasigluk
499 421 846 ,013 3,250,002 3,252,307
159,085 ,388 159,690,713 161,108,189 161,725,159
.99 .99 -98 -97
Coal Fired Steam Plant
4mMw 10MW
Construction Cost 36 ,624 ,746 57 ,479 ,549
Present Worth* 195,167 ,043 247,460,175
Present Worth Ratio -81 -64
Akiachak
Akiak
2,358 ,420
164 ,036 ,808
96
Lake Chikuminuk Hydroelectric Project
9.5MW 24MW
Construction Cost 17755255791 228 ,739 142
Present Worth* 410,952,298 512,643,449
Present Worth Ratio 38 ao
* All Project Costs
1916/485 (20)
2. Approve the Power Authority's findings with
modifications.
3. Disapprove the Power Authority's findings and refer to
staff for revisions.
F. Recommendation
Option 1
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APPENDIX B
Bethel Region Power Plan Oscarville Proposal
A. Action Item
Consideration of the preliminary feasibility findings for the Bethel Region and a recommendation to match Power Authority rural electrification funds with Oscarville Rural Development Assistance grants to complete a 4.65 mile demonstration leg of a Bethel-Oscarville Intertie at 34.5 kv or less depending upon final design parameters.
B. Background
A proposal to intertie Bethel area villages has been re- searched since 1975° as an alternative to costly independent diesel power stations. A demonstration single wire ground return line was subsequently built from Bethel to Napakiak. The community of Oscarville was also to have been included in the project but rights-of-way problems prohibited construc- tion. ,
Oscarville loads are relatively small and are currently met by a 100 kW generator without a functioning back-up. School
loads are met by its own power source. Retail costs for power
are estimated to be 60¢/kWh. The community currently has no ‘organized utility or rate structure to adequately support these energy prices and the entire cost of operation and
Management is currently supported by village corporation
monies.
Oscarville has been the recipient of a $100,000 Rural Develop-
ment Assistance (RDA) grant for electrification improvements.
Approximately half that sum is being proposed as a match for
design and construction of an intertie. The remainder would
be used to upgrade primary and secondary distribution.
Additionally, Oscarville is applying for a second $100,000 RDA
grant for exclusive use on an intertie. Discussion between
Power Authority staff and the Department of Community and
Regional Affairs indicates that positive consideration of that
request would be improved with the knowledge the Power Author-
ity would match funds for project completion.
leetherford, Lower Kuskokwim Power Study, for the Alaska Power
Administration
2143/514
The Power Authority's own findings and recommendations for the
Bethel Area computes a net present value ratio of .99 against a base case of continued diesel generation in Oscarville. This ratio is based upon the most conservative cost estimates and assumed contracted engineering and construction.
Cc: Issues
1. Cost estimating for distribution level interties in the
region had been performed for A frame structures, with a
three phase configuration or as single wire ground return
systems. Comprehensive design and estimates have not
been undertaken for conventional single phase utility
distribution lines. In-house cost estimates have varied
between $65,000 and $93,000, per mile. The line would
require no water crossings and would serve as a
demonstration project for future analysis of Bethel and
Bristol Bay area interties. Voltage and design would
allow for a future extension to Napaskiak which is
.75 miles from Oscarville across the Kuskokwim River.
2. Because Oscarville was to have been included in the
former single wire demonstration project, surplus mate-
rials are available at Bethel for use in the project.
These include over 6 miles of conductor, insulators,
epoxilators, fused cut-outs and other miscellaneous
material with a value of $20,000 or greater.
3. The commitment from Oscarville for matching funds through
RDA grants would limit Power Authority obligations to
design and construction. The Power Authority's obliga-
tion will be wholly contingent upon the community of Oscarville making available a dollar match of $150,000
for construction.
4. Preliminary requirements for rights-of-way have been
assessed and the proposed line location has been agreed
to by the Bethel Native Corporation. No right-of-way
impediments are envisioned. In addition to a dollar
match, Oscarville had advised the Power Authority that
acquisition of and rights-of-way would be undertaken by
them.
D. Cost *
On the assumption that design, rights-of-way and construction
oversite would be undertaken as in-house activities shared
between Oscarville and the Power Authority, construction cost
is estimated to be $75,000 per mile or approximately $350,000.
Power Authority commitment to construction would amount to
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Gs
D.
ES
The intertie costs were based on conservative assumptions and non-traditional tower design. Several engineering firms and
local utilities feel that the intertie costs might be reduced
by a more conventional design and use of local labor.
As the intertie options all cluster at a present worth ratio of 1.0 and hydropower and coal fired steam plant alternatives
fail by a substantial margin, it appears logical to pursue a
more in-depth study of the intertie configurations.
issues
1. The electrical demand in the Bethel Region is low enough
with a projected low growth rate that is difficult to
justify a capital intensive project.
2. Due to the scattered nature of the villages studied, it
becomes more costly to attempt to provide a single power
source outside of the existing load centers to serve the
entire Region.
3. Decreasing revenues from government sources would
indicate a greater burden of cost must be shouldered by
the villages themselves for capital projects.
4. A centralized source of power generation for the Region
would allow benefits of economies of scale in addition to
more standardized maintenance and operations.
bis If a centralized power project were to be constructed,
who would construct, own and maintain the power projects?
6. Possible use of coal for space heating may improve the
economies of coal utilization for electrical generation.
Cost
Cost of completing the preliminary plan of finance, selection
of specific intertie alternatives, and conceptual design is
estimated to not exceed $50,000. Monies would support
in-house staff and term consultants already on retainer for
rural electrification and technical assistance. Sufficient
funds are available from the Lower Kuskokwim Power Plan
account to fund this work.
Options
1. Approve the Power Authority's findings and
recommendations, and initiate the engineering design and
costing phase of interties in the Bethel Region.
1916/485(21)
$200,000, to be set aside from the Rural Electrification capital appropriation (1984).
E. Options
1. Establish a $200,000 reserve account from the Rural
Electrification appropriation for design and construction
of the 4.65 mile Bethel to Oscarville intertie. Funds would only be made available contingent upon a match of $150,000 from RDA grants, assigned directly to the Power
Authority for construction, and the securing of rights-
of-way by the community of Oscarville.
2. Deny Power Authority matching funds.
Fs Recommendation
1. Option #1, as stated in proposed resolution 1985-25.
2143/514