HomeMy WebLinkAboutRes 2005-01-Regulations-BFU_RPSU-JanAli), A;)~
Alaska Energy Authority
TO:
FROM:
DATE:
SUBJECT:
MEMORANDUM
Board of Directors
Alaska Energy Authority
Ron Miller
Executive Director
January 5, 2005
Resolution No. 2005-01
Adoption of AEA Regulations
Resolution No. 2005-01 adopts the amended regulations attached as Exhibit A to the
resolution. These amended regulations revise Alaska Administrative Code Title 3,
chapter 105 (administrative and other provisions), chapter 106 (loan programs), and
chapter 107 (grant programs), and also include a new chapter 108 dealing with financial
and technical assistance for energy systems, facilities; and equipment.
AEA widely distributed notice of the proposed revisions. Notice of the proposed
regulations was published in several Alaska newspapers in late October and early
November. AEA also mailed notice to all communities and utilities that receive Power
Cost Equalization (PCE); provided notice to legislators, and to the Denali Commission;
and posted the notice on AEA's website and on the State of Alaska Online Public Notice
System. A public hearing was held on the proposed regulations on December 2, 2004.
The public comment period closed on December 17,2004.
AEA received a total of three comments on the proposed regulations (all written), one
from the Legislative Affairs Agency and two from citizens (see attached comments). The
Legislative Affairs Agency comments were technical suggestions, and the draft
regulations have been revised accordingly. The citizens' comments were general,
speaking in favor of PCE generally and in favor of PCE for businesses. No revisions are
proposed in response to these comments. With respect to the citizen's comment
regarding PCE for businesses, please be aware that the PCE statutes limit PCE
assistance to local community facilities and residential customers. The proposed
revisions, which define "residential customer'' to include a customer who engages in
commercial activity at the customer's residence, are consistent with these comments
and with AEA's statutory authority.
Staff recommends approval of Resolution No. 2005-01.
813 West Northern Lights Boulevard • Anchorage, Alaska 99503
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ALASKA ENERGY AUTHORITY
RESOLUTION NO. 2005-01
RESOLUTION OF THE ALASKA ENERGY AUTHORITY
RELATING TO THE ADOPTION OF AMENDMENTS TO THE
AUTHORITY'S REGULATIONS
WHEREAS, pursuant to AS 44.83.080 the Alaska Energy Authority (the "Authority'') may
adopt regulations to carry out the purposes of AS 44.83 and AS 42.45;
WHEREAS, staff of the Authority has proposed that the Authority's regulations be
comprehensively amended as set forth in Exhibit "A" attached to this resolution (the "Regwlation
Amendments");
WHEREAS, the Authority has complied with all of the provisions of AS 44.62 concerning
the adoption by the Authority of regulations;
WHEREAS, the staff of the Authority has reported to this board the nature and content
of the cornrnents received frorn the public with respect to the Regulation Amendments and the
Authority has considered these comments; and
WHEREAS, it is in the best interest of the Authority that the Regulation Arnendrnents be
adopted.
NOW THEREFORE, BE IT RESOLVED BY THE ALASKA ENERGY AUTHORITY AS
FOLLOWS:
Section 1. In accordance with AS 44.83.080 the Authority hereby adopts the Regulation
Amendments.
Section 2. The Executive Director of the Authority is hereby authorized to take such
' actions necessary to finalize the regulation amendments contemplated in this resolution
including, without limitation, executing an apoption order on behalf of the Authority and taking
such actions as may be necessary to facilitate the filing of the amendments with the office of the
Lieutenant Governor.
DATED at Anchorage, Alaska, this 5 1
h day of January, 2005.
Chairman '
H:\Board of Directors\Resolutions and Mcmos\BOD Resolution AEA Reg adoption.doc
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EXHIBIT A
Register _______ 2004 ALASKA ENERGY AUTHORITY
3 AAC 105 is amended by adding a new section to read:
3 AAC 105.020. Administration of assistance from other sources. The authmity may
apply for, accept, and administer funding and other assistance from the United States, other
agencies of the state, municipalities, and private sources for the construction, financing,
operation, and maintenance of power projects and for bulk fuel, waste energy, energy
conservation, energy efficiency, and alternative energy facilities, equipment, or programs that are
consistent with the authmity's statutory authmity and programs. It may accept conditions placed
on federal and other state assistance that do not conflict with the authority's statutory authority
and programs. (Eff. ____}_! __ , Register __ )
Authority: AS 44.83.080
3 AAC 106.110(d), (e), (f), and (g) are amended to read:
(d) A loan committee comprised of authority staff designated by the executive ·
director of the authority shall make the final decision of the authority on applications for
loans up to and including $2 million. For loans in excess of $2 million, the board of
directors of the authority, upon recommendation by the loan committee, shall make the
final decision of the authority on applications for loans, except for loans that require
legislative approval under AS 42.45.010(0. The final decision of the authority to approve or
disapprove an application for a loan will be in the form of a Wiitten determination that contains
the findings required by this section, and any other comments the authority considers
appropriate. The authority will transmit copies of the determination to the applicant [AND TO
THE LOAN COMMITTEE].
(e) If the authority approves the loan application, the authmity will deliver a copy of its
decision to the applicant [LOAN COMMITTEE] within 30 days of making its decision. The
decision will:
(1) indicate whether there are conditions that the applicant must satisfy before the
authority will make the loan to the applicant; and
(2) include proposed loan termsJ; AND
(3}INCLUDE A STATEMENT OR STATEMENTS, AS APPLICABLE,
DESCRIBING THE PROCESS OF FURTHER REVIEWS OR APPROVALS REQUIRED
UNDER AS 42.45.060.]
(f) If the authority approves an application, and after approval of the loan by the [LOAN
COMMITTEE OR]legislature to the extent required under AS 42.45.0100) [AS 42.45.060], the
authmity will enter into a loan agreement with the applicant under conditions complying with 3
AAC 106.120, but only after receiving a certified copy of the resolution or other official action
taken by the applicant's governing body agreeing to the tetms of the loan.
(g) It is the responsibility of the applicant and not of the authority to obtain the approval
by the legislature if approval of the applicant's loan is required under AS 42.45.010(j) [AS
42.45.060(g)]. (Eff. 2/16/96, Register 137; am_!_! __ , Register __ )
Authority: AS 42.45.010 AS 42.45.060 AS 44.83.080
3 AAC 106.220(c), (d), and (e) are amended to read:
(c) If the authority approves the loan application, the authority will prepare a written
decision and deliver a copy of its decision to the applicant [LOAN COMMITTEE, AS
APPLICABLE UNDER AS 42.45.060]. The decision will:
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(1) indicate whether there are conditions that the applicant must satisfy before the
authority will make the loan to the applicant; and
(2) include proposed loan termsj;
(3) INCLUDE A STATEMENT OR STATEMENTS, AS APPLICABLE,
INDICATING THE
(A) LOAN APPLICATION IS SUBJECT TO REVIEW BY THE LOAN
ADVISORY COMMITTEE IN ACCORDANCE WITH AS 42.45.030 AND 3 AAC
106.230;
(B) PROCESS OF FURTHER REVIEW AND APPROVAL REQUIRED
UNDER AS 42.45.060.
(d) IT IS THE RESPONSIBILITY OF THE APPLICANT AND NOT OF THE
AUTHORITY TO OBTAIN THE APPROVAL BY THE LEGISLATURE IF APPROVAL OF
THE APPLICANT'S LOAN IS REQUIRED UNDER AS 42.45.060(g).]
(e) If the authority approves an application, [AND IF APPLICABLE, THE LOAN IS
ALSO APPROVED BY THE LOAN COMMITTEE OR THE LEGISLATURE UNDER AS
42.45.060,] the authority will prepare a loan agreement and other appropriate documentation to
reflect the terms of the loan sufficient, as determined by the authmity to assure repayment of the
loan in accordance with its teTms, and to provide for other matters the authority considers
approptiate in connection with the loan. The authority will not disburse the proceeds of the loan
to the borrower until the borroweT has entered into the loan agreement with the authority. (Eff.
2/16/96, Register 137; am_!_! __ , Register __ )
Authority: AS 42.45.020 AS 42.45.060 AS 44.83.080
AS 42.45.020
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3 AAC 106.300(3) is amended to read:
(3) written endorsement from the governing body of the community, where the
applicant is a person generating power or selling fuel in the community [FOR AN
INDIVIDUAL APPLYING FOR A BULK FUEL LOAN ON BEHALF OF THE
COMMUNITY];
(Eff. 2116/96, Register 137; am-. !_! __ ,Register __ )
Authority: AS 42.45.250 AS 44.83.080
3 AAC 106.310(1) and (4) are amended to read:
(1) an applicant must intend to use the loan for purchase of fuel for an emergency or
annual or semiannual supply, including the neces~ary costs of transporting the fuel;
( 4) the amount of the loan, added to the amounts of all other bulk fuel loans to the same
bon·ower in the same fiscal year, may not exceed $300,000 [$100,000]. (Eff. 2/16/96, Register
·'
137; am_!_! __ , Register __ ).
Authority: AS 42.45.250. AS 44.83.080
3 AAC 107.270(a) is amended by adding a new paragraph to read:
( 6) "residential customer" means a customer who resides at the
location receiving electrical service; the rules for determining residence of a
voter under AS 15.05.020 shall apply in determining a customer's residence;
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a customer who engages in commercial activity at the customer's residence is
considered a residential customer;
(Eff. 2/6/96, Register 137; am_!_! __ , Register __ )
Authority: AS 42.45.100
AS 42.45.110
AS 42.45.120
AS 42.45.130
AS 42.45.140
AS 42.45.150
3 AAC is amended by adding a new chapter to read:
AS 42.45.160
AS 42.45.170
AS 44.83.080
Chapter 108. Financial and Technical Assistance for Energy Systems, Facilities, and
Equipment.
Article 1. Bulk Fuel Facility and Power System Upgrades
3 AAC 108.100. Bulk fuel facility and power system upgrade assistance provided by
the authority. Subject to approptiation and availability of funds, the authority may provide
financial assistance and technical assistance, including construction management and training, to
recipients eligible for bulk fuel storage facility and power system upgrade assistance.
3 AAC 108.110. Eligibility for and authority prioritization of assistance. (a)
Utilities, municipalities, school districts, unincorporated villages, community associations,
Alaska Native corporations, federally recognized tribes, and other persons providing power or
fuel to the public in one or more communities are eligible for assistance under 3 AAC 108.100-
108.190.
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(b) To prioritize its assistance for bulk fuel facility upgrades, the authority shall evaluate
and rank deficiencies and needs for upgraded bulk community fuel storage facilities in each
Alaska community with a population of at least 20 but less than 2,000 that is not predominantly a
military or industrial site and that:
(i) has significant bulk fuel storage needs; and
(ii) is either located off an interconnected road system or, if located on an
interconnected road system, is more than 20 miles from Anchorage, Fairbanks, Juneau,
Kenai, Ketchikan, Kodiak, Nikiski, Sitka, Soldotna, Valdez, or another major fuel
distribution center.
(c) To prioritize its assistance for power system upgrades, the authmity shall evaluate and
rank deficiencies and needs for upgraded community power generation and distribution systems
in each Alaska community with a population of at least 20 but less than 2,000 that is not
predominantly a military or industrial site and that:
(i) has a central community power system; and
(ii) is not connected to the Railbelt (Homer-Sewmd-Anchorage-Fairbanks),
Four Dam Pool (Glenallen-Valdez, Wrangell-Petersburg, Ketchikan,
Kodiak), or Juneau power systems.
(d) The authority may reevaluate and modify its evaluations and rankings based on
changed assumptions or new information. The authority shall publish and periodically update its
rankings on its intemet web site.
(e) In providing assistance under 3 AAC 108.100-108.190, the authority shall give
ptimity to those communities found in the authmity's rankings under (b) and (c) of this section
to have the greatest needs for assistance. The authority may adjust priorities and deviate from its
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prioritization based on requirements of federal or state agencies or other entities providing
funding or based on the authority's determination of a recipient's readiness to proceed with the
project, the community's ability to meet conditions for assistance under 3 AAC 108.220, or cost-
effectiveness factors that wanant deviating from the authmity' s prioritization. (Eff.
_!_! __ ,Register __ )
Authority: AS 42.45.400 44.83.080
3 AAC 108.120. Conditions to receiving assistance. As a condition to providing
assistance under 3 AAC 108.100-108.190, the authority may require the recipient to:
(1) execute a grant agreement prepared by the authority that describes the terms and
conditions of the assistance;
(2) execute a waiver of sovereign immunity;
(3) provide a business plan or other documentation demonstrating to the satisfaction of
the authority the recipient's ability to operate and maintain the facility for the public benefit for
its useful life and to replace the facility at the end of its useful life;
(4) provide matching funds, property, services or another fmm of contribution to the
project;
(5) establish that the recipient has title to or a leasehold interest in the site on which the
facility is located; and
(6) abide by other terms and conditions that the authority determines are needed to
maximize the public benefit from the assistance provided under this chapter. (Eff. _!_! __ ,
Register __ )
Authority: AS 42.45.400 . 44.83.080
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3 AAC 108.130. Phased approach to assistance. The authority may employ a phased
approach to providing assistance under 3 AAC 108.100-108.190, including providing
assistance for a conceptual design or other planning documents to determine whether to provide
further assistance. (Eff. _!_! __ , Register __ )
Authmity: AS 42.45.400 44.83.080
Article 2. Circuit Rider and Electrical Emergencies Programs
3 AAC 108.200. Purpose of circuit rider and electrical emergencies programs. (a)
The purpose of the circuit rider program is to assist eligible utilities to improve the efficiency,
safety and reliability of power systems and reduce the risk and severity of emergency conditions
or emergency disruptions in the operation of community power systems, by providing training,
consultation, on-site assistance with maintenance and minor repairs, and other technical
assistance.
(b) The purpose of the electrical emergencies program is to assist eligible utilities
respond to emergencies that affect their ability to reliably generate and transmit power, by
providing financial or technical assistance in response to emergency conditions or emergency
disruptions in the operation of community power systems. (Eff. _!_! __ ,Register __ )
Authmity: AS 42.45.400 44.83.080
3 AAC 108.210. Circuit rider assistance provided by the authority. Circuit rider
assistance may include one or more visits to the community whose utility is selected to receive
assistance or it may be limited to assistance provided telephonically or by electronic mail. The
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circuit rider assistance to be provided will be determined based on the authmity' s assessment, in
consultation with the utility, of the utility's major needs and the authority's ability to provide
assistance for those needs. Assistance may include, without limitation:
(1) review of and recommendations to i.mprove the system condition and system
operations and maintenance;
(2) training utility personnel; and
(3) performing, or assisting utility personnel in their perfmmance of, minor maintenance
and repairs. (Eff. _/_/~-• Register~-)
Authmity: AS 42.45.400 44.83.080
3 AAC 108.Z20. Eligibility and selection for circuit rider assistance. (a) Subject to
approptiation and available funding, utilities in communities with population of less than 2,000
located off the interconnected road system are eligible for circuit tider assistance.
(b) At the beginning of each fiscal year, the authority shall identify the communities to
receive primity for circuit rider assistance that year based on power system deficiencies
identified in the evaluation and ptioritization of communities needs under 3 AAC 108.120, and
also taking into account the risk of catastrophic system failure, the utility's management
practices and operations and maintenance practices, the utility's ability to obtain and pay for
assistance from other sources, and how recently the utility received circuit rider assistance from
the authmity.
(c) The authority shall respond to requests for circuit rider assistance from eligible
utilities taking into account the prioritization under (b) of this section, available funding, and the
authority's ability to efficiently administer circuit rider assistance, including its ability to provide
9
assistance in multiple communities during one circuit rider trip. (Eff. _!_! __ , Register
_)
Authority: AS 42.45.400 44.83.080
3 AAC 108.230. Electrical emergency assistance provided by the authority. (a) In
the event a utility in a community with population of less than 2,000 located off the
interconnected road system suffers an electrical emergency, the authority will, subject to
appropriation and availability .of funds, assist the utility in responding to the emergency and
recovering its ability to generate and transmit power to its customers in a manner that does not
constitute a significant threat to life or property. Assistance may include, without limitation,
financial assistance or technical assistance, including emergency repairs.
(b) In this section, "electrical emergency" means a condition in a utility's system that
presents an imminent danger to life or likelihood of significant disruption of electrical service.
(Eff. _!_! __ ,Register __ )
Authmity: AS 42.45.400 44.83.080
3 AAC 108.240. Conditions to receiving assistance. As a condition to providing
assistance under 3 AAC 108.200-108.240, the authmity may require the recipient to:
(1) execute an agreement prepared by the authority that describes the te1ms and
conditions of the assistance;
(2) execute a waiver of sovereign immunity; and
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(3) abide by other terms and conditions that the auth01ity determines are needed to
maximize the public benefit from the assistance provided under this chapter. (Eff. _/_/ __ ,
Register __ )
Authority: AS 42.45.400 44.83.080
Article 3. Alternative Energy and Energy Efficiency Programs.
3 AAC 108.300. Alternative energy and energy efficiency assistance provided by the
authority. (a) Subject to appropriation and availability of funds, the authority may provide
financial and technical assistance to utilities, municipalities, school districts, unincorporated
villages, community associations, Native c01porations, federally recognized tribes, and
businesses for evaluation and development of sources of energy in the _state for local
consumption and for evaluation, development, and installation of measures to improve the
efficient utilization of energy that is consumed loca)ly.
(b) In providing assistance under this chapter, the authority will give priority to those
projects that show the greatest potential for reducing communities' dependence on diesel fuel for
power generation. (Eff. _!_! __ , Register __ )
Auth01ity: AS 42.45.400 44.83.080
3 AAC 108.310. Alternative energy and energy efficiency assistance plan. The
authority shall prepare, publish on its intemet web site, and periodically update a biennial plan
for providing altemative energy and energy efficiency assistance under this chapter. The plan
shall include a description of available funding and funding the authority plans to request for
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alternative energy and energy efficiency assistance, the types of assistance the authority provides
and plans to provide, and the criteria for allocating funds that the authority uses and plans to use.
(Eff. _I~--' Register __ )
Authority: · AS 42.45.400 44.83.080(5), (10), (13)
3 AAC 108.330. Conditions for receiving assistance. As a condition to providing
assistance under this chapter, the authority may require the recipient to:
(a) execute a grant agreement prepared by the authority that describes the terms and
conditions of the assistance;
(b) execute a waiver of sovereign immunity;
(c) provide matching funds, property, services or another form of contribution to the
project; and
(d) abide by other terms and conditions that the authority dete1mines are needed to
maximize the public benefit from the assistance provided under this chapter. (Eff. _!_! __ ,
Register __ )
Authority: AS 42.45.400 44.83.080
Article 4. General Provisions
3 AAC 108.400. Notice of availability of assistance and status of programs. The
authmity shall publish and periodically update on its internet web site information on procedures
for requesting assistance under this chapter and criteria that the authority uses to select recipients
of assistance; available funding for assistance under this chapter and allocation of available
funding to projects; status of rural power system upgrades, bulk fuel storage facility upgrades,
12
alternative energy projects, and energy efficiency projects under this chapter; and changes to
programs for providing assistance under this chapter considered or proposed by the authority.
(Eff. _!_! __ , Register __ )
Authority: AS 42.45.400 44.83.080
3 AAC 108.410. Protests and appeals. (a) Except as otherwise provided by law or as a
condition of assistance provided to the authority under 3 AAC 105.020, protests and appeals of
action taken by the authority under this chapter shall be made in accordance with this section.
(b) A person who is adversely affected by proposed or final action of the authority under
this chapter may submit a protest to the executive director of the authority.
(c) The protest must be submitted by fax, by mail, or by delivery to the authmity and
must be received by the authmity within ten calendar days after the authority provides notice of
the authority's action. If the protester shows good cause, the executive director may consider a
protest that is not filed in a timely manner.
(d) The protest must be in writing, must be signed by the protester, and must include
(1) the name, address, and telephone number of the protester;
(2) the signature of the protester or the protester's representative;
(3) identification of the procurement, solicitation, or other matter at issue;
( 4) a detailed statement of the legal and factual grounds of the protest, including
copies of relevant documents; and
(5) a statement of the remedy requested.
(e) Upon receipt of the protest, the executive director will provide notice to other
interested pmties and
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(1) make a final decision upon review of the protest and other relevant
information;
(2) delegate review of the protest to the autho1ity' s procurement manager or other
person for a recommendation and make a final decision based on the recommendation; or
(3) conduct a formal or informal hearing, or designate a heming officer to
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conduct a formal or informal hearing and provide a recommendation, upon which the executive
director's decision will be based.
(f) A decision of the executive director is a final administrative decision of the authmity.
An appeal of the decision shall be to the superior comt in Anchorage under the Alaska Rules of
Appellate Procedure. (Eff. _!_! __ , Register __ )
Authority: . AS 42.45.400 44.83.080
3 AAC 108.490. Definitions. In this chapter, unless the context requires otherwise,
(a) "altemative energy" means energy or fuels for production of elechicity, heat, or
mechanical power derived from renewable or local sources other than liquid petroleum,
including wind, solar, geothermal power, hydroelectlic, biomass, and local sources of coal and
natural gas;
(b) "construction" means planning for, designing, preparing the site for, building,
altering, testing, and improving the facility or equipment being upgraded;
(c) "bulk fuel storage facility" means tanks and appmtenant facilities and equipment,
including pipelines and headers, for the storage and distlibution of fuel for local consumption or
power generation;
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(d) "energy efficiency" means improvement of energy generation from, transmission by,
or utilization at existing facilities in the state, and includes facility insulation, energy-efficient
lighting, improved efficiency in diesel generation of power, and co-generation of electlicity, heat
or mechanical power;
(e) "power system" or "power project" has the meaning given in AS 44.83.990.
(f) "upgrade" means construction, renovation, repair, replacement, or other
improvements to a facility or equipment, and includes taking out of service facilities or
equipment replaced or rendered obsolete by the improvements to facility or equipment. (Eff.
_!_! __ , Register __ )
Authority: AS 42.45.400 44.83.080
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(907) 465-3867 or 465-2450
FAX (907) 465-2029
Mail Stop 3101
LEGAL SERVICES
DIVISION OF LEGAL AND RESEARCH SERVICES
LEGISLATIVE AFFAIRS AGENCY
STATE OF ALASKA State Capitol
Juneau, Alaska 99801-1182
Deliveries to: 129 61h SL, Rm. 329
MEMORANDUM November 10, 2004
SUBJECT:
TO:
FROM:
Proposed Regulations for Loan Programs of the Alaska Energy
Authority (3 AAC 1 06)
Senator Gene Therriault, Senate President & ARRC Chair
Representative Pete Kott, Speaker of the House
Deborah Behr, Dept. of Law ·
Becky Gay/AIDENAEA
Terri Lauterbach
Legislative Counsel ~
Under AS 24.20.105 (enacted by ch. 164, SLA 2004), I have reviewed proposed
regulations that would implement ch. 36, SLA 2004, relating to the Alaska Energy
Authority's loan programs. Under AS 24.20.105(e), I am supposed to inform you if I
determine that a provision of a proposed regulation fails to be consistent with the
applicable statutes being implemented by the regulation.
In my opinion, there are two places where the proposed regulations are inconsistent with
the applicable statutes because they contain a reference to a statute that was repealed in
ch. 36, SLA 2004. The obsolete reference in both instances is to AS 42.45.060, which
was repealed in sec. 11, ch. 36, SLA 2004.
The agency has agreed with my assessment that these references are obsolete, and it
intends to correct the references before the final regulations are adopted. However, it is
my understanding that AS 24.20.105(e) still requires me to notify you of my
determination.
The obsolete references to AS 42.45.060 are in 3 AAC 106.110(e)(3) and 3 AAC
106.220(c)(3)(B), copies attached. Please let me know if you require more infom1ation
on this matter.
TML:med
04-624.med
Enclosure