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HomeMy WebLinkAboutAEA Board Meeting Jan 2021Alaska Energy Authority BOARD MEETING MINUTES Wednesday, January 13, 2021 Anchorage, Alaska 1. CALL TO ORDER ALAS KA ENERGY AUTHORITY Chair Pruhs called the meeting of the Alaska Energy Authority to order on January 13, 2021 at 8:33 am. A quorum was established. 2. ROLL CALL BOARD MEMBERS Members present: Chair Dana Pruhs (Public Member); Vice -Chair Bernie Karl (Public Member); Julie Anderson (Commissioner DCCED); Anna MacKinnon (SOA-DOR), Albert Fogle (Public Member) (arrived 8:36 am); Bill Kendig (Public Member); and Julie Sande (Public Member). 3. AGENDA APPROVAL MOTION: A motion was made by Ms. Sande to approve the agenda as presented. Motion seconded by Vice -Chair Karl. The motion to approve the agenda passed without objection. 4. PRIOR MINUTES - December 9, 2020 MOTION: A motion was made by Vice -Chair Karl to approve the prior minutes of December 9, 2020. Motion seconded by Ms. Sande. The motion to approve the minutes of the December 9, 2020 minutes passed without objection. 5. PUBLIC COMMENTS (2 minutes per person) Chair Pruhs requested comments be limited to two minutes per person and reference today's agenda items. Dimitri Shein, Executive Director of Alaska Electric Vehicle Association (AKEVA), commented on the prior minutes of December 9, 2020, in which Board Member Anna MacKinnon encouraged the members of the public to work through the AEA process as it relates to the VW Settlement funds. Mr. Shein clarified for the Board that AEA has no such committee available for members of the public. Mr. Shein stated AEA has funded an EV Working Group that functions as a network opportunity and a forum in which stakeholders discuss EV related issues. • • ,. ,. 813 West Northern Lights Boulevard, Anchorage, Alaska 99503 T 907.771.3000 Toll Free 888.300.8534 F 907.771.3044 Mr. Shein discussed that AKEVA participants unanimously support that AEA needs to make VW funding available as soon as possible this year. He stated that AEA has had various VW working groups for over three years, and major stakeholders are frustrated with AEA's continued bait and switch tactics regarding VW funding. Mr. Shein noted that AEA staff has communicated during every Working Group session that VW funding will be available in 2021 for charging installations. Mr. Shein communicated that participants of the Working Group have contacted AEA Board for months because representations have been made and those representations are not being honored. Mr. Shein commented that the Working Group has no authority with respect to VW funding and all management authority remains with AEA. AKEVA requests AEA to honor its promises to EV drivers, utilities, private companies, and other partners to release VW funding for charging installation in the spring of 2021. He noted that AEA has not installed any chargers. Scott Henderson explained that he is a prospective EV buyer from Valdez, and has a reservation to purchase an EV this year. He encouraged AEA to move forward with the funds to install a charging network so he can drive his vehicle around the state. Julian Warren commented regarding the Arctic Refuge leases and called to request the Board members abandon the leases. Chair Pruhs asked Ms. Warren to postpone her comments to the AIDEA Board meeting. He noted that this is the AEA meeting and is an unrelated organization. Chair Pruhs requested Ms. Warren provide her phone number so staff can text or contact her when the AIDEA meeting begins. Ms. Warren agreed, and explained that yesterday, Alyssa Wilson provided this phone number and room code for today's meeting in relation to her specific Refuge comments. She asked that the revised public comment call -in information be communicated broadly. MOTION: A motion was made by Vice -Chair Karl to enter into Executive Session to discuss confidential financial matters related to the AEA audit, the immediate disclosure of which would have an adverse impact on the Authority, and to discuss confidential attorney/client communications related to a potential case and related facts and litigation strategy. Motion seconded by Ms. Sande. The motion was approved without objection. 6. EXECUTIVE SESSION 8:43 am Discuss confidential financial and legal matters The Board reconvened its regular meeting at 9:29 am. Chair Pruhs advised that the Board did not take any formal action on matters discussed while in executive session. 7. NEW BUSINESS Alaska Energy Authority Page 2 of 7 A. Resolution No. 2021-01 FY22 Operating and Capital Budget Submissions Ratification Chair Pruhs requested Curtis Thayer, Executive Director, discuss and present Resolution No. 2021-01. Mr. Thayer explained the resolution acknowledges the Governor's budget submission and provides Board ratification. Mr. Thayer gave a high level overview of the FY22 Operating and Capital Budget submissions. AEA will no longer be funded from UGF. He noted that the documents attached have been reviewed by the Board throughout the process. Mr. Fogle informed that a preliminary discussion occurred at the Budget Audit Subcommittee (BAS) last year and these changes have been approved. The BAS recommends approval of the resolution. Commissioner Anderson requested an update on the Alaska Cargo and Cold Storage project. Mr. Thayer discussed the ongoing negotiations that hopefully will be resolved in the upcoming weeks. The Department of Transportation is in the process of awarding the build grants. The specific construction schedule has not been determined. MOTION: A motion was made by Vice -Chair Karl to approve Resolution 2021-01 FY22 Operating and Capital Budget Submissions Ratification. Motion seconded by Mr. Fogle. A roll call was taken, and the motion to approve Resolution 2021-01 passed unanimously. B. OLD BUSINESS - NONE 9. DIRECTOR COMMENTS A. Response to Board Questions - NONE B. SSQ Line update - Permits Mr. Thayer informed the two outstanding leases have been attained and resolved. He thanked Jennifer Bertolini, AEA, for her assistance during the closing process. Mr. Fogle complimented Mr. Thayer on his excellent job regarding the SSQ Line. He asked if any work on the line will begin this year. Mr. Thayer believes work will begin this year. He noted that an updated work plan, including cost estimates, is in development. C. Rural Assets and disposition Mr. Thayer discussed two fully depreciated transmission assets built in the 1980's. The disposition of these was thought to have been completed 25 years ago, but new revelations Alaska Energy Authority Page 3 of 7 indicate that AEA maintains ownership. AEA is working to transfer the assets to the willing parties. D. Hydro Quarterly Update Mr. Thayer reviewed the Hydro Quarterly Update provided in member packets. Vice -Chair Karl inquired as to the repair methods utilized for the piston at Bradley Lake. Mr. Thayer stated he will inquire regarding the details and inform Vice -Chair Karl. He noted the item has a 30-year lifespan and it is at its 30-year lifespan. The utilities share the cost in the maintenance of the project. Chair Pruhs and Vice -Chair Karl emphasized the importance of following basic operation project management and including maintenance items in inventory that have a finite lifespan. Mr. Thayer discussed that the Bradley Lake utilities conduct routine maintenance and during the planned maintenance outage of one of the generators, additional unanticipated issues were found. Chair Pruhs asked if Kirk Warren, AEA, was available to comment. Mr. Warren acknowledged the point made regarding routine maintenance and having spare parts readily available. Mr. Warren explained that replacement of a generator and having spare parts would cost approximately $75 million. Mr. Warren agreed with Mr. Thayer that the utilities have engaged in prudent utility practice with regard to maintenance on Bradley Lake and he does not believe any harm to the ratepayers has occurred. Mr. Warren explained the item was milled and he believes it now back at the asset location. Mr. Thayer explained that after this unit is back online, the second unit is expected to be shut down for similar maintenance. It is unknown if any replacement items are on location. E. Renewable Energy Fund Update Mr. Thayer advised the list of qualified renewable energy projects is required to be given to the Legislature. He asked T.W. Patch, AEA, to provide the update. Mr. Patch gave an overview of his previous Board briefing. He explained that 21 applications were received and five were disqualified for procedural matters. The five applications that were disqualified were sent a letter advising them of their process deficiencies. The applicants were then afforded the opportunity to propose a cure or to seek reconsideration by the Review Committee. Mr. Patch believes the applications were prepared by qualified consultants. All five disqualified applications remain eliminated. Chair Pruhs asked if there are organizations or communities that have had multiple grant applications denied. Mr. Patch noted that he does not know that specific history with the program. Mr. Patch explained there are a number of professional grant writers that are successful in writing grants. Chair Pruhs discussed his concern to ensure that the requirements of the grant application are not so constrictive that few people have the expertise and the grant writing ability to meet the high threshold. Mr. Patch believes that Alaska Energy Authority Page 4 of 7 although there are people who are critical of the process, the Agency has completed 13 rounds of the program and has dispensed almost $300 million across the state. Chair Pruhs requested Mr. Thayer provide an update at the next meeting discussing commonalities of consultants and successful applications. He wants to ensure fairness of the process. Mr. Thayer agreed. He explained that the currently available funds are remaining or unused funds from previous rounds. The program is near the end of its life and no additional funding will be allocated. Commissioner Anderson requested Mr. Thayer, at the next meeting, provide the reasons the five applications were disqualified. Mr. Patch proposed that at the next meeting, the Board is provided with the analysis and information that will be presented to the Renewable Energy Fund Advisory Committee (REFAC) this Friday. The recommendation will subsequently be provided to the Legislature. Chair Pruhs agreed. Ms. MacKinnon advised that she previously served on the REFAC. She believes staff has done an incredible job of analyzing and creating an application, criteria, and scorecard for the requests. Ms. MacKinnon agreed that Chair Pruhs raised a valid point. F. Denali Commission Update Mr. Thayer stated the Active Denali Commission Awards have not changed since the previous meeting. The estimated jobs created column lists jobs during construction. Chair Pruhs requested the column name be changed to "Estimated Construction Jobs Created," and a separate column be added entitled "Estimated Permanent jobs Created." Mr. Thayer agreed. He noted that some of the projects are existing unit replacements. G. Rural Update Mr. Thayer advised that the current discussions with the Denali Commission for rural programs and projects could possibly add an additional $1.3 million to the current $5 million commitment. The inventory and assessment program has been delayed due to COVID-19. Completion is anticipated by the second quarter of 2021. There are four powerhouses in design and four bulk fuel upgrades in design. Currently, there are approximately 140 active projects in the state. Chair Pruhs requested that a process be created whereby AEA staff is notified when a rural community has only one generator. He believes this will assist in future preparation. Mr. Thayer agreed. H. Power Project Fund Dashboard and Loan Report Alaska Energy Authority Page 5 of 7 Mr. Thayer discussed that two loans have been recently refinanced for a lower interest rate. The one delinquent account shown on the report has been brought current. I. Community Outreach Mr. Thayer reviewed the community outreach engagement schedule, which has been decreased due to COVID-19. The meetings are currently being held via Zoom or by teleconference. Chair Pruhs requested Mr. Thayer conduct an analysis of AEA, comparing the efficiency of employees working from home versus the reduction of office space overhead, including the possibility of a net gain for company competitiveness. Chair Pruhs expressed this unique situation provides an opportunity for evaluation. Mr. Thayer agreed. J. Articles of Interest Mr. Thayer informed that he wrote a letter to all legislators describing AEA. He provided the most recent annual report. Mr. Thayer noted the annual Susitna-Watana letter to the Legislature is forthcoming. K. Next Regularly Scheduled AEA Board Meeting Wednesday, March 3, 2021 10. BOARD COMMENTS Vice -Chair Karl expressed compliments to Mr. Thayer for his leadership and accomplishments. He expressed appreciation to staff. Ms. Sande echoed Vice -Chair Karl's compliments. She extended appreciation to Senator Murkowski and her staff for the recent announcement and work on the Energy Act, which will hopefully have lasting impacts to rural Alaska. Ms. Sande asked Mr. Thayer if he had additional comments. Mr. Thayer explained that the COVID-19 relief package that was passed contained energy provisions supported by Senator Murkowski and Senator Manchin. Staff is analyzing the opportunities and funding available within the legislation and will provide an update to the Board at the March meeting. Chair Pruhs expressed appreciation to Mr. Thayer, staff, and Board members for their efforts today. He wished all a great new year. 11. ADJOURNMENT There being no further business of the Board, the AEA meeting adjourned at 10:22 am. Alaska Energy Authority Page 6 of 7 Curtis Thayer, Executive Director/ Secretary Alaska Energy Authority Alaska Energy Authority Page 7 of 7