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HomeMy WebLinkAboutBPMC Meeting, November 18, 1993 1BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING MINUTES Training Room - Chugach Electric Association, Inc. Thursday, November 18, 1993 8:00 a.m. CALL TO ORDER Chairman Highers called the meeting of the Bradley Lake Hydroelectric Project Management Committee to order at 8:10 a.m. in the Training Room at Chugach Electric Association in Anchorage, Alaska, to conduct the business of the Committee per the agenda and public notice. All Committee members were present, and a quorum was established. ROLL CALL Alaska Energy Authority Dennis McCrohan, Designated Representative Chugach Electric Association David L. Highers, Designated Representative and Chairman Golden Valley Electric Association Mike Kelly, Designated Representative City of Seward Dave Calvert, Designated Representative Homer Electric Association Norm Story, Designated Representative Matanuska Electric Association Ken Ritchey, Designated Representative Municipal Light & Power Tom Stahr, Designated Representative Others Present: Sharron Sigafoos, AIDEA Dan Beardsley, AIDEA/AEA Stan Sieczkowski, AEA/AIDEA Dave Eberle, AEA/AIDEA John S. Cooley, Chugach Electric Association Tom Lovas, Chugach Electric Association David Burlingame, Chugach Electric Association Ron Saxton, Ater, Wynne, Hewitt, Dodson & Skerritt Tim McConnell, Municipal Light & Power Jim Hall, Matanuska Electric Dave Fair, Homer Electric Myles Yerkes, Homer Electric Association Bradley Lake Project Management Committee Meeting Minutes - November 18, 1993 Page 2 of 8 Others Present (Continued): Bob Huffman, Alaska Electric Generation & Transmission Cooperative Larry Wolf, Alaska Energy Authority Brad Evans, Golden Valley Electric Association 3. PUBLIC COMMENT There was no public comment. 4. AGENDA COMMENTS There were no comments regarding the agenda. Chairman Highers welcomed Sharron Sigafoos and Dan Beardsley to the meeting. 5. APPROVAL OF MEETING MINUTES - OCTOBER 26, 1993 MOTION: Mike Kelly moved to approve the minutes of the October 26, 1993 meeting. Seconded by Norm Story. The following corrections and additions were noted: Under paragraph 8, AGREEMENTS SUBCOMMITTEE REPORT, Mr. Story stated that the paragraph which reads: "Mr. Stahr stated that the Agreements Subcommittee had not met since last Tuesday." should be changed to read: "Mr. Sieczkowski stated that the Agreements Subcom- mittee had not met since the last PMC meeting." Mr. Huffman asked that his name be added under "Others Present," as he was in attendance at the October 26th meeting. The recorder stated that several people’s names had been omitted under "Others Present" at the October 26th meeting. She said the omission had been noted, and that would be revised to include the names of all persons present prior to the minutes being submitted for the Chairman’s signature. On page 2, Mr. Cooley noted that the word "DEGNET" in the first sentence of the third paragraph of Item 6., TECHNICAL COORDINATING SUBCOMMITTEE REPORT, should be changed to "“DECNET." There being no further corrections, the minutes were approved as revised. Bradley Lake Project Management Committee Meeting Minutes - November 18, 1993 Page 3 of 8 6. TECHNICAL COORDINATING SUBCOMMITTEE REPORT The Chair stated that this item would be tabled until Mr. Burlingame was present to give the report. Mr. Burlingame, present at the completion of Mr. Ritchey’s report, stated that to his knowledge, all issues are operational issues and have been forwarded to the O&D Committee. Mr. Burlingame reported that, as far as he is aware, the Bradley spinning reserves is the only outstanding technical issue, and it has been referred to the ASCC. In addition, Mr. Burlingame reported that there have been two unit trips since the last PMC meeting. One was due to operator error; the other was a low oil pressure sump. In addition, there have been two more capacitor failures at Soldotna. Mr. Stahr stated that it was his belief the low oil pressure trip affected both units. Mr. Burlingame said that was incor- rect, that the unit trip he was referring to was a recent incident and only one unit was tripped. Referring to the incident where both units tripped simulta- neously, Mr. Stahr inquired if unit reliability had been analyzed since the incident. Mr. Burlingame responded that they had requested from AEA a list of every scenario that will cause both units to trip simultaneously. He reported that the list was longer than he would have thought. He said that even though most of the scenarios on the list require a multiple failure to trip both units, there are numerous protection systems which will trip both units, and he hadn’t been aware of this until he received the list from AEA in October. He added that the list has been distributed to Bradley O&D personnel. Mr. Sieczkowski stated that the O&D Committee is continuing to review and discuss these situations. 7. BUDGET SUBCOMMITTEE REPORT Mr. Ritchey reported that the Budget Subcommittee had met the previous day. A report was presented regarding the FY ‘93 O&M budget, and recommended adjustments will be forthcoming. In addition, the revised budget was discussed. Representatives of Homer Electric discussed the take-over by Homer Electric of the operation of Bradley Lake and the impact on the budget. Mr. Ritchey stated that the subcommittee discussed with Homer Electric and AIDEA representatives HEA’s proposal and the information provided by AIDEA. Many of the subcommittee’s questions were answered during that discussion; however, there Bradley Lake Projecc Management Committee Meeting Minutes - November 18, 1993 Page 4 of 8 oO. 11. are still some administrative tasks that need to be accom- plished. Mr. Ritchey stated that Homer Electric’s proposal basically looked at FY ‘94 as though HEA was operating the system for a full year, and the two budgets, the current one and Homer’s proposed budget, would have to be consolidated into a workable budget for FY ‘94. In response to a question from Mr. Kelly, Mr. Ritchey said this process should be completed by the first part of December because Homer Electric is supposed to take over the project the first of 1994. Mr. McCrohan agreed that the first of January is their target date; Mr. Ritchey said they would like to be able to accommodate that. AGREEMENTS SUBCOMMITTEE REPORT Mr. Sieczkowski stated that the Agreements Subcommittee had not met since the last PMC meeting. OPERATION AND DISPATCH SUBCOMMITTEE REPORT Mr. Sieczkowski stated that the O&D Subcommittee is scheduled to meet at the conclusion of this Project Management Committee meeting. REVIEW OF PROJECT STATUS Mr. Eberle reported that a proposal has been received from ABB to make the protection changes at the Soldotna SVC, and that proposal is being reviewed at this time. He added that the dollar amount of the project is in the $15,000 to $20,000 range. Mr. Eberle reported that the Project Management Committee is preparing to disburse the State surplus funds. However, prior to disbursement, an audit will be conducted to review the financing costs to ensure that the figures are correct. At completion of that review, the disbursement of surplus funds, estimated at approximately $12,000,000, will be made to the State. He added that because the funds have been held longer than anticipated, there should be some additional interest earnings. Mr. Eberle stated that he would advise the Com- mittee when the auditors have completed the reconciliation. OLD BUSINESS A. Spinning Reserves Update - Mr. Lovas reported that the Reliability Criteria Committee (RCC) continues to meet on the issue of operating reserves. Two items under close scrutiny are the proposed and potential projects ML&P has been successful in procuring for a _ superconductive Bradley Lake Project Management Committee Meeting Minutes - November 18, 1993 Page 5 of 8 magnetic energy storage system and the battery proposals as an alternative or a contributor to spinning reserves. He said the Committee is considering suggesting to the appropriate body that the RCC be the technical group designated to coordinate certain aspects of these projects and determine how they would apply in the interconnected system. Mr. Lovas reported that the RCC continues to be concerned with developing a method of evaluating the economic conse- quences of reliability analyses. He said the RCC is considering changing their emphasis from that of perfor- mance factors and performance evaluations to one that focuses on the economic consequences of the technical conditions on the system overall and provides the ability to contribute toward a method of evaluating the individual impacts and how the benefits and/or the costs of the reliability levels can be dealt with among the utilities. Mr. Lovas stated that the RCC is currently compiling the data they have reviewed in order to provide a definitive status report of the evaluations performed to date and provide a recommendation for the next steps in the process. Referencing the Ron Saxton memo distributed at the October meeting, Mr. Lovas said this objective is, in part, related to the concern regarding outstanding issues which need to be resolved. Mr. Lovas reported that the RCC is also in the process of defining tasks and programs for the University of Alaska, Fairbanks, which has received authorization to expend up to $50,000 to conduct studies and evaluations. Mr. Lovas stated that the RCC is working with UAF to develop programs and actions for 1994 that would contribute to the overall effort of the operating reserve evaluation and to the operation of utilities. Mr. Lovas concluded his report by saying that the next meeting of the RCC is scheduled for December 16, 1993. In response to a question by Mr. Ritchey, Mr. Lovas gave a brief history of the developments to date since the RCC was charged by the ASCC with the responsibility to study the operating reserve requirements of the interconnected system and to develop an appropriate level of operating reserve. Mr. Stahr stated his support for UAF’s participation in the program to determine the appropriate levels of spinning reserves and mixes. He urged the continued involvement of UAF in this process. Discussion followed. Bradley Lake Project Management Committee Meeting Minutes - November 18, 1993 Page 6 of 8 0QNwW Mr. Kelly stated that the Healy Clean Coal Project, with construction to commence in 1994, will be a future factor that will bear on this project. Discussion followed regarding the BES and SMES systems. Mr. Burlingame briefly discussed the impact of the new load-shedding schedule which has been in place approxi- mately six months. Mr. Stahr concurred with Mr. Burlin- game that the installation of the new load-shedding system has been a tremendous improvement. Master Operating Agreement Update HEA O&M Agreement - Terms and Conditions Homer Electric Association/Alaska Energy Authority/ Project Management Committee Duties - Mr. Saxton stated that his commentary regarding Item B., Master Operating Agreement Update, will also touch on Items C. and D. Mr. Saxton stated that the BPMC had a draft of the Master Operating Agreement as well as a draft of HEA’s O&M Agreement at the last meeting. He reminded the Committee that he was supposed to have received Committee member comment within one week, then he was to have distributed a compilation of the comments to the Committee members along with a memo scheduling a conference call to discuss them. However, he did not receive any comments during that time. Mr. Saxton reported that he now has the Committee member comments and will be able to get the comments compiled and distributed to the Committee members by Monday, November 22nd. He said a conference call could be scheduled for Monday the 22nd or Tuesday the 23rd, or the conference call could be scheduled for the following week, which would give the Committee members time to review the compiled comments. Mr. Saxton pointed out that HEA and the Alaska Energy Authority are anxious for BPMC to get started, and although he didn’t feel any insurmountable issues had been raised, the member comments provided to him require discussion, and a conference call for this purpose should be scheduled soon. Mr. McCrohan stated that he felt the budget process could be conducted simultaneously with the Agreements, but ultimately, the signing of the Agreements has to precede the budget because if Homer’s duties or the roles of the parties change, it will affect the budget. He recommended that the Agreement process be completed by early December Bradley Lake Projevcc Management Committee Meeting Minutes - November 18, 1993 Page 7 of 8 12. NEW in order to facilitate having the budget process completed by mid-December. Mr. Saxton reiterated that he would require a couple of days to compile and distribute the Committee member comments, but a conference call meeting needs to be scheduled in order to discuss the comments. Mr. Kelly stated that although he has not been directly involved in this process, he has some cost concerns, from the standpoint of the Budget Committee process, which relate to retention of costs by AEA and level of costs by Homer. Brief discussion followed. Mr. Story concurred that Mr. Saxton should compile and distribute the Committee member comments, with a confer- ence call to be scheduled for the 22nd or 23rd of November to discuss contract concerns. With regard to the budget, Mr. Story stated that the contract is separate from the budget. The contract must be approved before the budget in any event, so required budget changes will be made as a result of the contract revisions. Discussion followed. There was a consensus of the Committee that Mr. Saxton would distribute the compiled contract comments to the Committee members no later than Monday, November 22, and a conference call would be held Wednesday, November 24, 1993, at 9:00 a.m. Mr. Kelly requested that Mr. Ritchey provide an update of the Budget Committee meeting relative to the status of the HEA and AEA costs. Upon request, Mr. Ritchey duplicated his handout on the board and provided an explanatory narrative for the Committee’s benefit. Discussion followed. BUSINESS Approval of Legal Expenses and Other Payments MOTION: Mr. Kelly moved to approve payment of approxi- mately $12,000 for Committee legal expenses for the month of October 1993. Seconded by Mr. Ritchey. A roll call vote was taken, and the motion passed unanimously. 13. COMMITTEE COMMENTS A. Next Meeting Date - The Committee discussed issues to be addressed prior to year end. Based on these discussions, there was a consensus of the Committee that a meeting in December may not be required. However, there will be a Bradley Lake Project Management Committee Meeting Minutes - November 18, 1993 Page 8 of 8 14. conference call to discuss Committee member comments regarding the Master Operating Agreement and the HEA O&M Agreement on Wednesday, November 24, 1993, at 9:00 a.m. B. IBEW Labor Negotiations - Mr. Sieczkowski pointed out that the IBEW labor negotiations are currently suspended pending the decision made at this Committee meeting with regard to HEA’s takeover of the project. If there is a substantial delay in Homer’s takeover, it is likely that IBEW would pursue labor negotiations, and BPMC would be obligated to continue with them. C. Pre-Meeting - Chairman Highers requested that a brief pre- meeting be held in the Training Room when this meeting adjourns and prior to commencement of the next meeting. ADJOURNMENT There being no further business of the Committee, the meeting was adjourned at 9:15 a.m. avid L. Highefs, Chairman ATTEST: [WA Used VMc G8 Dennis V. McCrohan, Secretary