HomeMy WebLinkAbout2021 AEA Annual Report (Final)2021
ANNUAL
REPORT
REDUCING THE COST OF ENERGY IN ALASKA AKENERGYAUTHORITY.ORG
THE ALASKA ENERGY
AUTHORITY (AEA)
POSITIVELY IMPACTS
NEARLY EVERY COMMUNITY
AND RATEPAYER IN ALASKA.
AEA ACTIVE PROJECTS
AND SERVICESCONTENTS
4 Message from the Governor
5 About AEA
6 Message from the Chair
7 Message from the
Executive Director
8 Owned Assets
10 Power Cost Equalization
12 Rural Energy
16 Alternative Energy and
Energy Efficiency Programs
22 Grants and Loans
24 Financial Highlights
26 Board of Directors
27 Executive Team
Biomass or Biofuels
Heat Pump
Heat Recovery
Hydroelectric
Ocean/River
Other
Solar
Transmission
Village Energy
Efficiency Program
Wind
Map Legend
Annual Report Requirements
The publication on the activities and financial condition of AEA is submitted in accordance with Alaska Statute (AS)
44.83.940. The report was printed in Anchorage, Alaska at a cost of $5.95 per copy for a total number of 500 copies.
Design and production by AEA. Printed by Service Business Printing.
Cover Photo
AEA and and FreeWire Technologies held a ribbon-cutting ceremony on September 23, 2021 at AJ’s OldTown Steakhouse
& Tavern in Homer to commemorate the commissioning of the first of nine EV fast-charging stations to be installed on a
statewide network and the very first ultrafast EV charger in Alaska. Photo by Kachemak Communications.
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About AEA
Created in 1976 by the Alaska Legislature, AEA is a public corporation of the State of Alaska
governed by a board of directors with the mission to “reduce the cost of energy in Alaska.” AEA is
the state’s energy office and lead agency for statewide energy policy and program development.
Dear Fellow Alaskans,
The Alaska Energy Authority (AEA) is home to the
state’s energy office and lead agency for energy policy
and program development. For more than 45 years,
AEA has worked to ensure that Alaskans have access
to safe, reliable, affordable energy.
AEA owns the Bradley Lake Hydroelectric Project,
the largest hydropower facility in Alaska. Energized in
1991, the project provides low-cost power to more
than 550,000 Alaskans. To optimize the project’s
value, AEA, in partnership with the Railbelt utilities, is
working to reduce current transmission constraints to
more efficiently deliver power at no increased cost to
ratepayers or burden to the State.
In rural Alaska, AEA reduces the high cost of
electricity through its administration of the Power
Cost Equalization (PCE) program. PCE serves 81,200
Alaskans in 193 rural communities primarily reliant
on diesel for power generation. Last year’s total PCE
budget was $29 million. AEA also invests in energy
projects in rural Alaska lowering the costs for our rural
neighbors. Since 2000, AEA has invested almost $400
million in rural energy infrastructure.
To prepare Alaska for electrification of transportation,
AEA has developed a strategic plan to establish a
statewide electric vehicle fast-charging network
along Alaska highways. AEA has teamed up with site
hosts to install 15 fast-chargers and eight Level 2
chargers at nine locations from Homer and Seward
to Fairbanks. All chargers are anticipated to be
operational by summer 2022.
AEA manages the Renewable Energy Fund (REF), a
program that diversifies energy sources and provides
resiliency
through developing renewable
energy projects. Working with the
Legislature, we identified 11 projects and approved
$4.7 million in grant funding in Fiscal Year 2022.
In my proposed budget for the Fiscal Year 2023, I
included $15 million for the REF program, the largest
capitalization of the fund since the Fiscal Year 2014 to
continue investing in renewable energy.
We have only begun to tap Alaska’s renewable energy
potential. Increasing our investment in clean energy
today will provide future Alaskans with a sustainable
energy future tomorrow.
Best regards,
MIKE DUNLEAVY
Governor
MESSAGE FROM
THE GOVERNOR
OWNED
ASSETS
AEA owns the Alaska
Intertie and the Bradley
Lake Hydroelectric Project.
These assets benefit Railbelt
consumers by reducing the
cost of power.
RURAL
ENERGY
In rural Alaska, AEA constructs bulk
fuel tank farms, diesel powerhouses,
and electrical distribution grids.
Through circuit rider, emergency
response, and training for operators
and utility managers, AEA supports
the operation of these facilities.
POWER COST
EQUALIZATION
The Power Cost Equalization
program reduces the unit cost
of electricity in rural Alaska
for residential customers and
community customers
of eligible utilities.
ALTERNATIVE ENERGY
AND ENERGY EFFICIENCY
AEA provides renewable energy
and energy efficiency grants,
analysis, and expertise. These
include hydro, biomass, wind,
solar, and others.
ENERGY
PLANNING
In collaboration with local
and regional partners, AEA
provides critical economic and
engineering analysis to plan the
development of cost-effective
energy infrastructure.
GRANTS AND
LOANS
AEA provides loans to qualified
utilities, local governments, and
independent power producers
for the construction or upgrade
of power generation and other
energy facilities.
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MESSAGE FROM
THE CHAIR
AEA’s mission is to develop and implement
low-cost, reliable energy solutions for more
than 730,000 Alaskans. Over the past year,
we did just that — overcoming the challenges
brought on by COVID-19 disruptions, supply-
chain issues, and workforce constraints.
Our mission has never been more relevant. We
are working hard to ensure that Alaska’s energy
infrastructure is operationally safe, efficient, and
resilient in the face of these challenges.
Alaska’s Railbelt transmission infrastructure was
constructed more than 40 years. To extend its useful
life, AEA acquired a component of the interconnected
system located on the Kenai Peninsula in December
2020. That line will soon benefit from $53 million in
upgrades critical to the delivery of power from AEA’s
Bradley Lake Hydroelectric Project. These upgrades
will reduce losses and increase the reliability of this
low-cost and carbon-free power for customers along
the Railbelt from Kenai Peninsula to Fairbanks.
AEA has taken an active role in the development of
an Electric Reliability Organization (ERO), which was
mandated by the Legislature under Senate Bill 123.
The ERO will make the Alaska Railbelt’s Bulk Electric
System more reliable and resilient by developing and
enforcing system-wide standards, and creating an
integrated resource plan. These measures will allow
the Railbelt region to more effectively meet future
load requirements.
Last year, AEA budgeted $29 million in Power Cost
Equalization (PCE) payments to rural electric utilities
for the benefit of 193 communities and nearly 82,000
Alaskans. PCE is a long-term, stable financing source
benefiting residential customers and community
facilities.
Another highlight was AEA’s award of $1 million in
competitive grants to support the installation of eight
Level 2 electric vehicle (EV) chargers and 15 fast
chargers at nine locations from Seward and Homer
to Fairbanks. These charging stations will be located
less than 100 miles apart along the state’s backbone
highway system. Deploying EV charging infrastructure
is critical for the growth of Alaska’s EV market.
To help support statewide COVID-19 recovery, AEA
administered the Electric Utility Relief Program and
distributed nearly $5 million of federally provided
funds to 33 electric utilities compensating them
for residential members who experienced financial
hardship due to the COVID-19 pandemic.
As AEA Board Members, we know our decisions
affects all Alaskans. This next year will bring new
challenges and opportunities, and we are confident
that AEA is prepared to respond.
J. DANA PRUHS
Chair
Across our energy projects, programs, and services
we focused on finding more efficient and sustainable
ways for Alaskans to access clean, dependable,
and affordable energy resources to improve living
standards, promote economic growth, and create jobs.
Throughout the year, we sought ways to optimize
the value of our assets. AEA identified opportunities
that will enhance Alaska’s largest hydroelectric
facility, the Bradley Lake Hydroelectric Project, and
is working with its Railbelt utility partners to upgrade
and improve Bradley Lake power generation and
operations for the benefit of the more than 550,000
Alaskans on the Railbelt.
Following the successful completion of the West
Fork Upper Battle Creek Diversion project in 2020,
AEA is studying a new project to optimize the energy
potential of Bradley Lake. Similar to Battle Creek,
the Dixon Diversion Project would divert water from
Dixon Glacier increasing the annual energy production
of Bradley Lake.
AEA is improving critical infrastructure across rural
Alaska by leveraging federal partnerships to develop
an inventory and assessment of eligible community
rural power systems to prioritize assistance. For the
first time, AEA deployed three-dimensional imaging
and geographic information system software to
provide a more accurate complete picture of each
power system.
Through its Renewable Energy Fund (REF), AEA is
expanding investment in those energy projects to
achieve deployment of clean, sustainable, energy
solutions that benefit our residents by lowering costs
and diminishing our carbon footprint. Over the life
of REF, $275 million of funding has been deployed
towards the development of renewable energy. Almost
300 renewable energy projects are part of the REF
catalog. AEA estimates that approximately $70 million
in fuel cost savings have been achieved by over 95
operational REF projects.
Recent weather extremes remind us how vital reliable
energy infrastructure is. The federal Infrastructure
Investment and Jobs Act will deliver historic levels of
new infrastructure investment to Alaska, enabling us
to modernize our infrastructure for the benefit of our
families and children.
Thank you to all of our partners for your continued
support and commitment to energy efficiency,
renewable energy, transportation electrification, and
low-cost energy access for all Alaskans.
CURTIS W. THAYER
Executive Director
MESSAGE FROM THE
EXECUTIVE DIRECTOR
This year, AEA again delivered on its
commitment to pursuing energy solutions
that meet the unique needs of Alaska’s
rural and urban communities. Through its
actions, AEA helped Alaskans develop
and thrive.
6 72021 AEA Annual Report 2021 AEA Annual Report
10%
Bradley Lake generates about
10 percent of the total annual
electrical energy used by
Railbelt electric utilities.
ENERGY
$0.04
From 1995 through 2020, the
project averaged 392,000 MWh
of energy production annually
at $0.04 per kWh.
GENERATION COST PER KWH
ALASKA INTERTIE
Completed in 1986, the Alaska Intertie is a 170-mile long, 345-kilovolt
(kV) transmission line that stretches between Willow and Healy and
operates at 138 kV. The Intertie connects Golden Valley Electric
Association (GVEA), the utility that serves areas north of the Alaska
Range, with Southcentral Alaska utilities. It was funded with State of
Alaska appropriations totalling $124 million and has no debt service.
The Intertie provides significant cost savings through the transmission
of economy energy to GVEA. It delivers to GVEA its power share of
Bradley Lake and enables the sharing of reserve generation capacity
between the Anchorage and Fairbanks load centers.
Operation of the Intertie is governed by the Alaska Intertie Agreement
signed in 1985 and amended thereafter. The parties to the agreement
are AEA, Chugach Electric Association, GVEA, and Matanuska
Electric Association. Each of these entities has a seat on the Intertie
Management Committee (IMC), which has responsibility for managing
the Intertie.
Through AEA’s leadership as an IMC member and with its step-in rights
on financial decisions regarding the Intertie, AEA is uniquely positioned
to ensure that ratepayers across the electrically interconnected Railbelt
region benefit as intended under the current Alaska Intertie Agreement.
In Fiscal Year 2021, the IMC created an Asset Management Plan for the
Alaska Intertie. The plan includes a preventive maintenance program,
multi-year projections of maintenance and repair funding, climate
change considerations, and analysis of factors affecting future use. The
plan incorporates and facilitates some of the major changes anticipated
on the Railbelt, such as increasing renewable power generation,
reduced greenhouse gas production, and participation by Independent
Power Producers.
Throughout the 1980s, AEA developed the state’s
energy resources to help diversify Alaska’s economy
and provide affordable energy to Alaskans. AEA
built and owns several key pieces of Railbelt electric
infrastructure — the Alaska Intertie, the Bradley Lake
Hydroelectric Project, and the Sterling to Quartz Creek
transmission line.
BRADLEY LAKE HYDROELECTRIC PROJECT
Energized in September 1991, the Bradley Lake Hydroelectric Project
located near Homer, Alaska has been a low-cost source of electricity
for the Railbelt for more than 30 years. The 120-megawatt (MW)
facility generates about 10 percent of the total annual power used by
Railbelt electric utilities at some of the lowest-cost power to more than
550,000 Alaskans.
The power generation potential of Bradley Lake was first studied in
1955 by the United States Army Corps of Engineers. AEA, then the
Alaska Power Authority, assumed responsibility for the project in
1982. To date, the total project cost is approximately $400 million. The
project was funded through legislative appropriations and AEA revenue
bonds that are being repaid by the participating utilities. The Bradley
Lake Project Management Committee (BPMC) manages the project,
subject to AEA’s non-delegable rights, duties, and responsibilities.
Throughout the year, AEA sought ways to optimize the value of the
project. Following the successful completion of the West Fork Upper
Battle Creek Diversion Project in 2020, AEA is studying a new project
to optimize the energy potential of Bradley Lake. Similar to Battle
Creek, the Dixon Diversion Project would divert water from Dixon
Glacier increasing the annual energy production of Bradley Lake.
AEA acquired a component of the interconnected transmission system
located on the Kenai Peninsula in December 2020. That line will soon
benefit from $53 million in upgrades critical to the delivery of power
from Bradley Lake. The upgrades will reduce losses and increase
the reliability of this low-cost and carbon-free power for Railbelt
customers.
OWNED
ASSETS 120MW
Bradley Lake generators are
rated to produce up to 120 MW
of power.
CAPACITY
AVERAGE COST SAVINGS
$30M
Between 2008 and 2018, the
Intertie provided an average
annual cost savings of
$30 million to GVEA.
8 92021 AEA Annual Report 2021 AEA Annual Report
In accordance with AS 44.83.940, AEA produces an
annual PCE Statistical Report on the stats and operations
of the program. Data is based on information submitted
by the utility and is available by community and utility. To
view the reports, visit akenergyauthority.org.
91 81,200
500 kWh 70 kWh $29M
RESIDENTIAL PUBLIC FACILITIES FUNDS BUDGETED
Residential customers are
eligible for PCE credit up to
500 kWhs per month.
Community facilities can
receive PCE credit for up to 70
kWhs per month multiplied by
the number of residents in a
community.
In Fiscal Year 2021, AEA
budgeted $29 million for
payment of PCE to rural
electric utilities for the benefit
of our rural communities.
POWER COST EQUALIZATION
The Power Cost Equalization Program
(PCE) was enacted to lower the cost of
electrical power born by rural residents
and community facilities to a level
comparable to that paid by residents of
Alaska’s larger cities.
Established in 1985, the PCE program makes
payments to eligible rural electric utility companies
and those companies credit their residential and
community facility customers with payments made
from the program up to a level of consumption. Those
payments result in a reduction of the unit cost of
power to residential and community customers. The
pre-PCE cost of electricity in rural communities is
almost always significantly more than the electricity
costs borne by customers in Alaska’s urban areas.
Residential and community facility buildings and
assets in nearly 200 communities see the benefits of
PCE credits.
AEA calculates the amount an eligible electric utility
is due based on a filing made by the utility and issues
monthly payments. The PCE program staff also
provides technical assistance to utility clerks who
need help preparing and filing PCE reports. The PCE
disbursements are funded from the PCE Endowment
Fund. AS 42.45.085 provides that five percent of
the PCE Endowment Fund’s three-year monthly
average market value may be appropriated to the PCE
program. In recent years, the five-percent draw on
the endowment has been sufficient to fully fund PCE
disbursements. Fiscal year 2018 saw the enactment
of statutory changes that addresses how excess PCE
Endowment Fund earnings are to be used. These
changes allowed the endowment fund earnings to pay
for PCE program administration costs fully and the
earnings could also contribute $30 million to other
state programs such as the Community Assistance
Program, the Renewable Energy Fund Program, and for
some Rural Power System Upgrade projects.
AEA is now using a web portal through which
participating PCE-communities may submit their
Utility Monthly Reports (UMR). The electronically
filed UMR should see shortened processing times
and that should lead to quicker payments. As the
web portal gains broader acceptance and as utility
companies gain experience in electronically filing
their monthly reports, there will likely also be a
reduction in administrative costs to the electric utility
companies and AEA. Hand in glove with the portal,
AEA is migrating to mandated electronic fund transfer
of funds for lowered costs and enhanced security of
payments to utility companies.
193
RURAL COMMUNITIES ELECTRIC UTILITIES ALASKANS
The cost of electricity for Alaska’s rural
residents is notably higher than for
urban residents. PCE lowers the cost of
electric service paid by rural residents.
Ultimately ensuring the viability of
rural utilities and the availability of
reliable, centralized power.
St. George, Alaska
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In rural Alaska, AEA constructs bulk fuel tank farms, diesel powerhouses, and electrical
distribution grids. Through circuit rider, emergency response, and training for operators
and utility managers, AEA supports the operation of these facilities. Through innovation
and collaboration, AEA provides the tools and the guidance necessary for all rural
communities to embrace a better energy future.
Bulk Fuel Tank Farm, Nunam Iqua, Alaska
RURAL POWER SYSTEMS UPGRADE
AEA’s Rural Power Systems Upgrade (RPSU)
program builds and retrofits facilities in
communities of less than 2,000 people, providing
stable and reliable power. The typical efficiency
improvement in diesel generation is between
10 and 20 percent. Upgrades may include
efficiency improvements, powerhouse upgrades
or replacements, line assessments, demand-side
enhancements, heat recovery, and repairs to
generation and distribution systems. The Denali
Commission is AEA’s major federal funding partner,
which requires a state match of 50 percent for
non-distressed communities or 20 percent for
distressed communities.
RPSU also manages the State’s allocation through
the Environmental Protection Agency’s (EPA’s)
Diesel Emissions Reduction Act (DERA). Pending
yearly funding from Congress, states can apply
for DERA funds based on population. In addition
to the state program, EPA also has a tribal
DERA program that awards funds competitively
nationwide. AEA uses DERA funds to replace prime
power diesel engines in rural Alaska. AEA selects
communities for engine replacement through the
DERA program based on current engine condition,
redundancy, efficiency, and engine eligibility.
In Calendar Year 2021, AEA initiated five RPSU
powerhouse replacement projects in Napaskiak,
Nelson Lagoon, Nikolai, Rampart, and Venetie.
Additional RPSU design and construction work,
including engine replacement with DERA funds,
was completed in Arctic Village (three engines) and
Anvik (one engine). Design has been completed for
the Chenega DERA project (two engines).
AEA has switched emphasis from full facility
replacement to improving operations and
maintenance to maximize the benefit to rural
power systems. There are currently 22 active
Maintenance and Improvement (M&I) projects,
which target high return investment in eligible
community power systems. Typical projects include
replacing old switchgear and control systems,
maximizing heat recovery, and updating engine
controls to improve efficiency and sometimes
replacing diesel gensets.
$300M
The deferred maintenance
for RPSU is estimated at
approximately $300 million.
DEFERRED COSTS
RURAL ENERGY $800M
The deferred maintenance
for BFU is estimated at
approximately $800 million.
BULK FUEL UPGRADE
Rural Alaska depends on liquid fuels for most of its
energy needs — diesel for power generation, and
heating and gasoline for transportation. Most rural
villages are located along rivers or on the coast, so
fuel is delivered primarily by barge. Delivery is often
limited by season or weather. Most communities
receive barge fuel deliveries once or twice a year.
Many of rural Alaska’s bulk fuel facilities were built
in the mid-1900s and do not comply with modern
regulations. Yet they typically continue in service until
upgraded or replaced, posing risks to personal safety
and the environment.
AEA’s Bulk Fuel Upgrade (BFU) program repairs or
upgrades fuel storage facilities in communities with
fewer than 2,000 residents. These facilities help
decrease the per-unit cost of fuel by allowing the
community to purchase fuel in bulk quantities. In
Calendar Year 2021 there are five full BFU projects
underway.
In recent years, AEA has switched its emphasis from
bulk fuel facility replacement to Maintenance and
Improvement (M&I) projects. There are 18 M&I
projects planned currently, which target high-return
investment in eligible community power systems. In
Calendar Year 2021, AEA completed a full-
facility BFU project in the traditional
Alutiiq coastal Native Village
of Tatitlek.
DEFERRED COSTS
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AEA provides soup to nuts technical assistance to rural utilities to ensure that infrastructure lasts
its full economic life, preventing catastrophic electrical emergencies, and building community self-
sufficiency. This helps assure safe, reliable, operation of rural Alaska electric generation equipment in
which millions of dollars are invested.
RURAL TRAINING
AEA’s Rural Training program develops operators with the skills necessary to operate
their energy infrastructure and keep operators compliant with current industry
standards. In Calendar Year 2021, 56 operators from 38 communities trained in Bulk
Fuel and Power Plant Operations at the Alaska Vocational Technical Center. AEA is
pioneering the use of 3D imaging coupled with data from every rural powerhouse to
create new ways for operators to learn about their site’s specific needs. AEA has also
developed an online training curriculum using the same technology decreasing the
cost of travel and expanding the training audience.
CIRCUIT RIDER AND TECHNICAL ASSISTANCE
The Circuit Rider and Technical Assistance programs provide essential assistance to
reduce the number of emergency responses needed when there are power outages in
rural communities. In Calendar Year 2021, Circuit Riders assisted eligible utilities over
450 times in providing remote monitoring, training, technical consultation. Onsite
assistance and minor repairs to power systems were performed in 82 communities.
ELECTRICAL EMERGENCY ASSISTANCE
AEA provides power-related electrical emergency assistance to rural communities.
Electrical emergency assistance encompasses risk to life or property due to power
failure. Thankfully this assistance is rarely needed. In Calendar Year 2021, one
emergency response was required.
450
Communities received
Circuit Rider and/or
Technical Assistance
56
Operators from
38 communities
received training
1
Community
recieved electrical
emergency assistance
AEA provides training courses for
power plant operators to help ensure that rural
utility staff have the essential skills to operate their power plant.
14 152021 AEA Annual Report 2021 AEA Annual Report
AEA’s energy technology programs are at the forefront of growing Alaska’s clean
energy economy. The programs work with local governments, non-profits, and tribal
organizations to implement new energy solutions. They also provide technical assistance,
funding, and training to increase knowledge about cost-saving energy technologies.
BIOMASS
Biomass heat reduces diesel fuel
use, keeps the money spent on fuel
(wood) within the community, and
creates local jobs. AEA’s biomass
program funded over 20 operating
woody biomass heating systems
for schools and public buildings
and provided technical support for
over 50 operating systems in the
state. Along with the United States
Forest Service (USFS), the program
has funded over 170 preliminary
studies to evaluate a community’s
biomass potential. In 2021,
AEA partnered with the Denali
Commission and USFS to fund the
design and construction of projects
in 10 communities. Despite
COVID-19 travel limitations, AEA
developed an audit and training
program to support existing
systems to ensure longevity and
sustainability of the systems.
HYDROELECTRIC
Hydroelectric power is Alaska’s
largest source of renewable energy
and supplies more than 27 percent
of the state’s electrical energy
in an average water year. AEA’s
hydroelectric program assists
approximately 51 utility-scale
hydroelectric projects throughout
the state. The majority of Alaska’s
existing hydro projects are located
in the Southeast and Southcentral
regions of Alaska. Projects range
from concepts to operational
hydroelectric facilities. The
hydroelectric program focuses on
improving efficiency and quality in
development, lowering the cost of
construction, and coordinating with
state, federal, municipalities, tribal
entities, and private investors in
analyzing, planning, and generally
assisting hydroelectric project
development.
SOLAR
Alaska’s latitude presents the
challenge of minimal solar energy
during long winter months when
energy demand is greatest,
however there is growing interest
in solar photovoltaic (PV) systems.
These systems range from on
and off-grid residential to utility
scale PV. Solar generation in the
shoulder months (spring and fall)
is often impressive in northern
latitudes where clear skies, cool
temperatures, dry air and bright,
reflective snow all increase solar
generation. Solar PV systems can
actually exceed their rated output
during these times of year. AEA
provides solar energy information,
resources, and technical assistance.
The Power Project Fund and the
Renewable Energy Fund have
provided grant and loan financing
for several PV projects on the
Railbelt and in rural Alaska.
WIND
Today wind energy accounts for 2.4
percent of the state’s total energy
production and that percent is
growing. Since 2012, Alaska’s wind
energy capacity has increased 400
percent. This growth is supported
by AEA’s Renewable Energy Fund
and information sharing among
wind energy producers and
stakeholders. AEA’s Alaska Wind
Working Group and its Wind
Advisory Panel meet regularly to
discuss policy issues necessary to
advance wind energy. Funding for
wind projects is a frequent topic
at these meetings. In partnership
with the Wind Working Group,
AEA facilitates annual educational
events including the wind-diesel
and energy storage workshops. AEA
assists communities in evaluating
wind energy and often aids in rural
community decision-making.Pillar Mountain Wind Farm, Kodiak, Alaska
ALTERNATIVE ENERGY
AND ENERGY EFFICIENCY 10
In 2021, AEA partnered with the
Denali Commission and USFS to
fund the design and construction
of projects in 10 communities.
BIOMASS PROJECTS FUNDED
27%
Hydroelectric power is Alaska’s
largest source of renewable energy
and supplies more than 27 percent
of the state’s electrical energy in
an average water year.
HYDROELECTRIC POWER
400%
Alaska’s wind energy capacity has
increased 400 percent in the last
decade.
WIND ENERGY CAPACITY
16 172021 AEA Annual Report 2021 AEA Annual Report
Outdoor lighting retrofit completed at Nenana City School District.
ENERGY EFFICIENCY AND CONSERVATION
Efficient production and consumption of energy saves
costs, reduces demand, and are often the lowest
hanging fruit for energy solutions. It is available in
every community in Alaska. AEA focuses its end use
energy efficiency program activities on commercial
buildings, public buildings, industrial facilities, and
electrical efficiency. Additionally, AEA organizes
the collaborative multi-stakeholder group called the
Alaska Energy Efficiency Partnership.
Alaska Commercial Property Assessed Clean Energy
(C-PACE) Program
AEA was awarded $300,000 from the Department of
Energy with $60,000 from state matching funds to
stand up an Alaska C-PACE program. C-PACE is an
innovative clean energy-financing tool that provides
access to 100 percent upfront capital for building
owners who want to upgrade their buildings with
more energy efficient systems. The Municipality
of Anchorage was the first to adopt its enabling
ordinance. AEA and its project partners are engaging
stakeholders across Alaska in C-PACE implementation
strategies. Their initiatives include designing uniform
program parameters, drafting, moving C-PACE
programs through the local ordinance process, and
building the framework for the role of the statewide
C-PACE Program Administrator. By 2022, AEA hopes
to have Alaska C-PACE enabled in three Alaska
municipalities.
Alaska Energy Efficiency Partnership (AEEP)
At the center of AEA’s energy efficiency and
conservation outreach efforts is the AEEP, a
stakeholder group of over 50 public, private, and non-
profit entities from around Alaska who meet quarterly
to discuss energy efficiency and conservation efforts
in Alaska. The group’s mission is to improve the
coordination of efforts promoting the adoption of
greater end-use energy efficiency measures and
energy conservation behaviors through information
sharing and integrated planning so that Alaska may
become the most energy efficient state in the nation.
BENEFITS
OF ENERGY
EFFICIENCY
Power Pledge Challenge (PPC)
AEA partnered in the annual PPC, which educates
middle school students in rural and urban Alaska on
the benefits of energy efficiency and conservation.
The yearlong project increases energy literacy
and included 1,014 students from 21 schools in
12 communities who participated in 52 monthly
challenges that incorporated developing community
energy profiles, energy saving public service
announcements, and calculating energy savings by
using efficient holiday decorations.
Remote Alaska Communities Energy Efficiency
Challenge (RACEE)
AEA’s efficiency program provides technical assistance
through the Department of Energy for
nine communities participating in the RACEE. The
RACEE projects support upgrades and renewable
energy installations in rural Alaska to help save
money, energy, and fuel.
Village Energy Efficiency Program (VEEP)
VEEP is an AEA grant program established by Alaska
Legislature in 2010 to reduce per capita consumption
through energy efficiency. AEA leveraged federal
State Energy Program funds and a grant from Wells
Fargo and the Denali Commission to meet our mission.
Through a public-private partnership, VEEP received
a $1 million grant from Wells Fargo to provide 47
communities with outdoor lighting retrofits. The
local match was $397,000, for a total investment
of nearly $1.1 million. The project also leveraged
Denali Commission funds; with $428,483 of Denali
Commission funds and a local match of $110,917,
AEA enabled 17 additional communities the same
opportunity. Despite the COVID-19 pandemic,
communities have actively implemented their projects.
Thirty-seven sites are complete, 1,150 lights have
been replaced, and 520,450 kWh per year will be
saved. Cost per kWh in these communities ranges
between $0.19–$1.00.
Through a partnership between the tribe and the City, Aniak
will be performing lighting retrofits at City Hall, Library,
Public Works, Sewer Lift Stations, Fire Department and the
Traditional Council/Community Center. Installations will be
complete by June 2022.
Stimulates
the Economy
Energy Efficient
Buildings
Money in
your Pocket
192021 AEA Annual Report182021 AEA Annual Report
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ELECTRIC VEHICLES
AEA made significant progress over the year in
leading Alaska’s effort to minimize barriers to
electric vehicle (EV) adoption. AEA continued
its sponsorship of the Alaska Electric Vehicle
Working Group. The Working Group met
quarterly and discussed a wide range of
topics including how to grow the EV market,
utility demand charges, rate structures, and
siting criteria for publicly accessible charging
locations.
AEA increased EV awareness and
infrastructure deployment through a range
of strategic activities. In partnership with the
Dimond Center and the Alaska EV Association,
AEA hosted the first EV Car Show and Ride
and Drive event. The show earned significant
media attention and gave attendees the
chance to test drive an EV, talk to a local
utility, and visit with EV owners on the
benefits and challenges of owning an EV.
Lack of EV charging infrastructure remains a
significant barrier to EV market adoption.
To overcome this barrier AEA developed a
multi-pronged approach for the installations
of fast-charging and community-based Level 2
chargers. Utilizing State Energy Program (SEP)
funds, three Level 2 chargers were installed
in downtown Anchorage at two state-owned
facilities. More EV public charging stations are
planned for deployment in 2022. AEA hopes
to see an EV fast-charging network along
the highways and at Marine Highway ferry
terminals in the near future.
The Infrastructure Investment
and Jobs Act offers once-in-a-
lifetime funding to complete
a statewide EV fast-charging
network, as well as community-based
charging installations in rural and urban
areas throughout the state.
AJ’s Old Town Steakhouse and Tavern
HOMER
Custom Seafood Processors
SOLDOTNA
Grizzly Ridge Lodge
COOPER LANDING
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Three Bears Alaska
TRAPPER CREEK
Jack River Inn
CANTWELL
Three Bears Alaska
HEALY
• In 2021, AEA utilized Volkswagen Trust
and SEP funds to develop the first phase
connecting Seward and Homer in the southern
part of the state’s Railbelt corridor north to
Healy.
• Fifteen fast chargers and eight Level 2 chargers
will be installed at nine sites.
• Charging stations will be located within 100
miles of adjacent sites.
• The entire charging network is anticipated to
be operational by summer 2022.
• AEA continues to pursue funding opportunities
to expand Alaska’s EV fast-charging
infrastructure and community-based chargers
throughout the state.
Preparing Alaska for EVs
AEA joined the Dimond Center in celebrating the ground breaking of its AEA-funded EV Fast-Charging
station during the first EV Car Show and Ride and Drive event held on August 7, 2021. Photo by Tim Leach.
9/15/8
9 Sites Selected
15 Fast Chargers
8 Level 2 Chargers
SITES AND CHARGERS
2022
Alaska’s first EV fast-charging
corridor will be operational by
summer 2022.
ANTICIPATED COMPLETION
$1.52M
VW: $875,000
SEP: $90,000
Private: $555,000
TOTAL INVESTMENT
Seward Chamber of Commerce
SEWARD
Dimond Center
ANCHORAGE
Three Bears Alaska
CHUGIAK
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EV Fast-Charging Network
20 212021 AEA Annual Report 2021 AEA Annual Report
POWER PROJECT FUND (PPF)
AEA administers PPF loan requests from qualified
applicants seeking low-interest loans. PPF allows local
utilities, local governments, or independent power
producers to seek low-cost funding for development,
expansion, or upgrade of electric power facilities,
including distribution, transmission, efficiency and
conservation, bulk fuel storage, and waste energy.
PPF is a unique financial instrument that provides
affordable loan funds for early stage energy projects,
such as reconnaissance or feasibility studies. Loan
terms are correlated to a project’s useful life. Interest
rates on PPFs loans are formula-driven and related to
the 30-year taxable municipal bond yield index, with a
prevailing rate of 2.79 percent as of January 31, 2022.
RENEWABLE ENERGY FUND (REF)
The REF was established in 2008 to help Alaskans
reduce and stabilize their cost of energy through the
development of viable renewable energy projects.
The program is designed to produce cost-effective
renewable energy for heat and power, increasing
resiliency through the diversification of generation
sources. To date, REF has made 244 grants to develop
or construct renewable energy projects statewide.
There are now over 95 operating projects built with
contributions from REF, collectively saving more
than 30 million gallons of diesel each year. Annual
renewable energy generation increases each year as
more REF-funded projects become operational. From
2008 to 2021, $275 million was made available to
REF projects. State funding has been matched with
hundreds of millions of dollars from other sources to
develop these renewable energy projects.
In Fiscal Year 2020, AEA solicited applications for
REF Round 13. In consultation with the Renewable
Energy Fund Advisory Committee (REFAC), AEA
recommended 11 projects for funding. In September
2021, the Legislature approved AEA’s recommendation
and appropriated $4.7 million for awards to the
recommended projects. AEA is currently evaluating
39 funding applications submitted for consideration
during REF Round 14. AEA’s consultation with
the REFAC is planned for late March with a
subsequent submission to the Legislature of projects
recommended for funding in FY2023 planned for early
April. The REF grant program sunsets on June 30,
2023. An extension of its sunset date is being sought.
Replacement of Diesel Engines used for Prime Power
($1.14 million + match funds)
AEA has set aside Trust funds as a voluntary match for
AEA’s Diesel Emission Reduction Act (DERA) program
to fully leverage the federal funds allocated to the
State by the EPA. By contributing the voluntary match,
the State can receive 50 percent more EPA DERA
funds to replace diesel engines or gensets in rural
powerhouses. Engine/genset replacement projects
were completed in summer and fall 2020 in Chignik
Lake (2), Circle (2), Takotna (2), and Tuluksak (1); and
in October 2021 in Arctic Village (3). Replacements
are expected to occur in Chenega Bay (2) in 2022.
Funds have also been obligated to replace gensets in
Grayling, Platinum, and Ruby.
EV Charging Infrastructure ($875,000)
Alaska allocated 15 percent of the VW Trust funds
($1.25 million) for EV charging installations. AEA
developed a phased approach to establish a statewide
interconnected EV fast-charging network along the
highways and ferry terminals, as funding allows. In
2021, AEA utilized VW Trust funds, SEP funds, and
private matching funds from site hosts to develop the
first phase of the fast-charging network, connecting
Seward and Homer to Healy. Additional VW Trust
funds for EV chargers will be disbursed in 2022.
All-electric Garbage and Box Trucks ($25,000)
AEA has committed $25,000 to the Municipality of
Anchorage for the purchase of an energy-storage
based fast charger for their new all-electric garbage
truck and electric box trucks.
Public Transit Bus Replacement ($234,000)
Utilizing VW Trust funds, AEA funded 20 percent of
the state’s first all-electric transit bus. The 40-foot
bus, purchased by the City and Borough of Juneau
(CBJ) for Capital Transit, was ordered in 2020 and
began passenger service in April 2021.
VOLKSWAGEN (VW) SETTLEMENT FUNDS
On January 29, 2018, Alaska became the beneficiary
of $8.125 million from the VW Environmental
Mitigation Trust (Trust) established as part of a court
settlement for mitigation projects to reduce nitrogen
oxide (NOx) emissions. AEA is the State’s lead agency
to develop and implement a Beneficiary Mitigation
Plan to distribute the funds for eligible mitigation
actions that result in a total lifetime reduction of
NOx emissions by 10.5 tons. The projects selected
thus far will reduce NOx emissions by more than
2.5 times Alaska’s mitigation goal. A summary of the
disbursement of funds includes:
AEA contributes in the energy space by administering several funding programs. The agency also monitors
funding sources including Tribal and Indian Energy loan programs and United States Department of Energy
(USDOE) funding opportunities. AEA’s strong relationship with the USDOE, awareness of funding, and
technical assistance available from National Laboratories is of benefit to all Alaskans.
GRANTS AND
LOANS
School Bus Replacement
($4.3 million)
In 2019, AEA funded the
purchase of 33 school
buses in eight school
districts: Alaska Gateway
(Tok) (1), Anchorage
(13), Juneau (1), Kake
City (2), Kenai Peninsula
Borough (7), Kodiak
Island (1), Matanuska-
Susitna Borough (4), and
Southeast Island (Prince of
Wales Island) (4).
Alaska’s first all-electric school bus in Tok, Alaska.
22 232021 AEA Annual Report 2021 AEA Annual Report
REVENUES, EXPENSES, & CHANGES IN NET POSITION (CONT)June 30, 2021 June 30, 2020
Operating Expenses:
Grants and projects 20,370 18,714
Power cost equalization grants 25,557 29,255
Interest expense 1,159 827
Plant operating 7,797 5,376
General and administrative 20,605 5,742
Provision for loan loss (33)61
Loss on disposal of asset ––
Depreciation 12,356 10,917
State of Alaska appropriations and transfers –21,288
Other project expenses ––
Total operating expense 87,811 92,180
Operating loss (47,310)(56,209)
Investment Income, net 151,983 51,411
State of Alaska reappropriations and transfers 1,017,213 (66)
Capital contributions ––
Increase (decrease) in net position 1,121,886 (1)(4,864) (2)
* *
*Unaudited – Derived from Audited Financial Statements (in thousands).
(1) Beginning in FY21, the sweep of the PCE fund into the Constitutional Budget Reserve (CBR) was deemed ineligible and was
removed from the sweep by legal ruling. Therefore AEA’s fund balance increased with the retention of the Endowment Funds.
Additionally, in FY21 beginning net position/fund balance was restated to record revised amounts related to sweep activity
in the due to the State of Alaska ($7,388) and revised amounts related to the general activity in the due to funds managed by
Treasury ($2,239).
(2) In FY19, State of Alaska’s Department of Law opined that the PCE Endowment Fund was subject to the State’s general fund
unobligated fund balance sweep of certain money into the State’s Constitutional Budget Reserve. On June 30, 2019, $1.05
billion was swept, with the reversal of the sweep, pursuant to legislation, happened on July 1, 2019. The same sweep process
occurred on June 30, 2020, which netted the reversal from FY19 with the FY20 sweep amount of $1.06 billion. FY20 is the
first year that the reversal and new sweep occurred creating an increase to overall net position.
BALANCE SHEETS June 30, 2021 June 30, 2020
Assets and deferred outflows of resources:
Restricted Investments securities and cash 1,243,953 1,180,885
Loans, net 26,011 27,032
Capital assets, net 396,079 388,046
Receivables and other assets 6,457 3,919
Total Assets 1,672,500 1,599,882
Liabilities and net position:
Liabilities
Bonds payable 69,099 63,684
Other bond liabilities 569 1,052
Payables and other liabilities 33,153 1,096,980
Total liabilities 102,821 1,161,716
Net Position 1,569,679 438,166
Total liabilities and net position 1,672,500 1,599,882
REVENUES, EXPENSES, & CHANGES IN NET POSITION June 30, 2021 June 30, 2020
Operating revenues:
Federal grants 8,575 7,845
Revenue from operating plants 22,657 21,361
State operating and capital revenues 3,922 4,719
Interest on loans 339 362
Other operating revenues 5,008 1,684
Total operating revenues 40,501 35,971
FY2021 FINANCIAL HIGHLIGHTS*
24 252021 AEA Annual Report 2021 AEA Annual Report
CURTIS W. THAYER
Executive Director
DONA KEPPERS
Chief Financial Officer
KIRK WARREN, PE, PMP
Director, Engineering and
Energy Development
BRANDY M. DIXON
Communications Director
LINDA SENN, PH.D.
Human Resources Director
TERENCE CATO
Information Technology Director
TIM SANDSTROM, PMP
Director, Rural Programs
AUDREY ALSTROM, PE
Director, Alternative Energy and
Energy Efficiency Programs
T.W. PATCH, JD
Director of Planning
J. DANA PRUHS
Chair, Public Member
JULIE SANDE
Commissioner, Alaska Department
of Commerce, Community, and
Economic Development
ALBERT FOGLE
Public Member
BILL KENDIG
Public Member
ANNA MACKINNON
Division Director, Alaska
Permanent Fund
BILL VIVLAMORE
Public Member
EXECUTIVE TEAMBOARD OF DIRECTORS
26 272021 AEA Annual Report 2021 AEA Annual Report
ADDRESS
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ANCHORAGE, AK 99503
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EMAIL & WEB
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