Loading...
HomeMy WebLinkAboutBPMC Meeting Thursday, June 3 2010 2BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING MINUTES REGULAR MEETING (via electronic media at the Alaska Energy Authority’s Board Room) Anchorage, Alaska June 3, 2010 - 10:00 a.m. 1. CALL TO ORDER Chair Evans called the regular meeting of the Bradley Lake Hydroelectric Project Management Committee to order at 10:00 a.m. on Thursday June 3, 2010, from the AEA Boardroom, Anchorage, Alaska, to conduct the business of the Committee per the agenda and public notice. 2. ROLL CALL Roll was called by May Clark. The following members were present: City of Seward John Foutz (teleconference) Joe Griffith Matanuska Electric Association (teleconference) Brad Evans Chugach Electric Association Harvey Ambrose Homer Electric Association Henri Dale Golden Valley Electric Association Jim Posey Anchorage Municipal Light & Power Bryan Carey Alaska Energy Authority 3. PUBLIC ROLL CALL Mike Cunningham, CEA Burke Wick, CEA Ed Jenkin, CEA Jim Kingrey, HEA Rick Miller, AML&P Don Zoerb, MEA (teleconference) Brian Bjorkquist, Dept. of Law Kirk Gibson, McDowell Rackner & Gibson pc (teleconference) Bill Prentice, McDowell Rackner & Gibson pc (teleconference) Chris Rutz, AEA Linda MacMillan, AEA Shauna Howell, AEA May Clark, AEA 4. PUBLIC COMMENT There were no public comments. Page 1 of 7 BPMC Minutes 6/3/2010 5. AGENDA COMMENTS / MOTION FOR APPROVAL There were no agenda comments. MOTION: Mr. Griffith moved to approve the agenda as presented. Seconded by Mr. Carey. The agenda was unanimously approved as presented. 6. APPROVAL OF MEETING MINUTES — March 30, 2010 Mr. Griffith stated he was present by teleconference, however, it was not indicated in the minutes. MOTION: Mr. Ambrose moved to approve the minutes of the March 30, 2010 meeting. Seconded by Mr. Dale . The meeting minutes were unanimously approved with the correction showing Mr. Griffith as being in attendance by teleconference. t NEW BUSINESS 7A. Series 5 Bond Refunding: Mr. Cunningham referenced McDowell Rackner & Gibson PC documents in the meeting packet, dated June 3, 2010. The PMC and AEA have been working closely to complete the refunding. A preliminary offering statement was developed and distributed to the participants. Two update calls were conducted with ratings agencies Moody’s and Standard & Poor's. In response to due diligence questions, a due diligence call was also made. Future activities include the offering statement and bond pricing. The BPMC finance committee recommends approval of Resolution 2010-01. At or near bond closing each utility will be required to complete the Certificate of Power Purchaser form and the Continuing Disclosure Agreement on their letterhead, which is a normal requirement. A checklist will be provided to assist in completing the form. BPMC counsel will work with each individual utility's counsel to accomplish this task. Mr. Griffith questioned why we are carrying an extra month’s interest on the bonds and was informed that Valorie Walker (AEA’s Deputy Director, Finance) would contact him with clarification to his question. Mr. Posey joined the meeting by teleconference at 10:16 a.m. The motion was read into the record as follows to include the Resolution language as underlined below. MOTION: Mr. Griffith moved that the Bradley Lake Project Management Committee on behalf of the Power Purchasers, hereby determine that it is in the best interests of the Power Purchasers and their customers or members that the proposed refinancing of the Fifth Series bonds be completed by the issuance of the Sixth Series bonds and that the timely furnishing by the Power Purchasers of the certificates and opinions and information relating to the Official Statement required under the Bond Purchase Agreement (BPA), and the annual financial information required under the Disclosure Page 2 of 7 BPMC Minutes 6/3/2010 Agreement, and approval of Consenting and Approving Resolution No. 2010-01 is a reasonable obligation of each Purchasing Utility. Seconded by Mr. Posey. A roll call vote was taken: City of Seward: Yes Matanuska Electric Association: Yes Chugach Electric Association: Yes Homer Electric Association: Yes Golden Valley Electric Association: Yes Anchorage Municipal Light & Power: Yes Alaska Energy Authority: Yes The motion unanimously passed. Mr. Griffith asked if the BPMC still needed a motion on the Resolution. Chair Evans stated that he felt that was covered by inserting the Resolution language in the previous motion. Mr. Bjorkquist stated if there was any question, AEA would want it to be very clear that the Resolution has been adopted, and it was suggested that if there was any ambiguity, that the Committee vote for adopting the Resolution separately. MOTION: Mr. Griffith moved that the Bradley Lake Project Management Committee adopt Resolution 2010-01. Seconded by Mr. Ambrose. A roll call vote was taken: City of Seward: Yes Matanuska Electric Association: Yes Chugach Electric Association: Yes Homer Electric Association: Yes Golden Valley Electric Association: Yes Anchorage Municipal Light & Power: Yes Alaska Energy Authority: Yes The motion unanimously passed. Chair Evans urged the participants to remain in diligent contact with Mr. Cunningham to keep the process moving. Mr. Cunningham stated all was going well and expected no problems. BPMC counsel will put together an opinion for the underwriters on this matter. Mr. Posey arrived at the meeting at 10:24 a.m. 7B. FY10 Budget Report/Approve Amended FY10 Budget The BPMC budget policy, adopted in the October 2009 meeting, requires BPMC approval to amend the operating budget if a surplus or deficit greater than $250,000 is projected. A FY10 budget reduction of $375,000, due to projected increase in interest income, and decrease in R&C fund and arbitrage payments, offset by increase in debt service for July 2010 interest Page 3 of 7 BPMC Minutes 6/3/2010 related to Series 5 bond refunding, was presented along with a motion to approve the amended budget and refund the resulting surplus to the utilities by June 30, 2010. MOTION: Mr. Dale moved that the Bradley Lake Project Management Committee approve the attached amended FY10 Budget and refund the $375,000 reduction in budget to the utilities by June 30, 2010. Seconded by Mr. Posey. A roll call vote was taken: City of Seward: Yes Matanuska Electric Association: Yes Chugach Electric Association: Yes Homer Electric Association: Yes Golden Valley Electric Association: Yes Anchorage Municipal Light & Power: Yes Alaska Energy Authority: Yes The motion unanimously passed. 7C. Retain ARECA as property insurance provider Following state procurement guidelines, there were four respondents to the RFP with ARECA being the successful respondent. MOTION: Mr. Carey moved that the Bradley Lake Project Management Committee authorize the retention of the ARECA insurance Exchange to procure property and related insurance coverages, as necessary, for the Bradley Lake Hydroelectric Project effective 7/1/2010. Seconded by Mr. Posey. A roll call vote was taken: City of Seward: Yes Matanuska Electric Association: Yes Chugach Electric Association: Yes Homer Electric Association: Yes Golden Valley Electric Association: Yes Anchorage Municipal Light & Power: Yes Alaska Energy Authority: Yes The motion unanimously passed. 8. OLD BUSINESS 8A. Middle Fork Flows We have been talking with the resource agencies to request flow deviations of up to 7.5% of the required minimum flows at lower Bradley and to get their consent, have agreed that we would perform an intra-gravel temperature study at a cost of $25,000 at the location of the existing USGS gage. Page 4 of 7 BPMC Minutes 6/3/2010 AEA will request FERC approval for a five year trial program to evaluate the feasibility of allowing operation 7.5% below the required seasonal flow values, provided that the 24 hour average flow is maintained at or above the required value in Lower Bradley River. They also want to do four netting events during the fall salmon run to be performed by the USFWS only this year. We would provide the transportation to Bradley. After five years we can apply for an amendment to the Bradley permit. Comments to the amendment would be limited to flow data only. The dam operators will need to discuss this, perhaps using software through CEA to monitor flows. If automated, it should work better and be part of the daily routine. The resource agencies are writing letters to AEA regarding concurrence with the plan. Once we receive those letters, we will correspond with FERC. Upon receipt of FERC approval, we will install the intra- gravel gages and instruct USFWS to proceed. No further specifics were required by the BPMC. 8B. Battle Creek At the previous meeting, the BPMC authorized spending $75,000 through the end of this fiscal year ending June 30 and $20,000 has been expended to date. We would continue the $75,000 into the next fiscal year for a pre-feasibility study. For preliminary engineering $75,000 extended to the next fiscal year would be sufficient to get the satellite photographs and detailed topographical maps and conceptual costs late this year to better determine the route selection. A PowerPoint photograph was shown of the area. A stakeholder’s (ADF&G, USFWS, NMFS, DNR) meeting was held May 18, 2010 at AEA. The diversion would likely be placed at 1,200 feet or 1,500 feet and the land area is at 10 square miles including the glacier. At 80% diversion for those months, based on two year’s data we have, it would come out to be about 35-36,000 acre feet equaling 35-36,000 Mwh. Based on the data for Solomon Gulch, tunnel amounts could be more like $3,500/foot. At the agencies request, to get more flow rates and to move after permitting, we will install two gauges on Battle Creek and also perform stream characterization of the Creek which includes counting the fish. These tasks are not covered in the current budget. If we were to begin this year, it would cost approximately $225,000 for both, and for engineering and environmental data it would cost about $300,000. Salmon start to return in mid-July and water flow is already increasing. If we wait until after July, we will miss several of salmon species which could delay any type of permitting or decisions in regards to the environmental flows by year. For the steam characterization and fish counting, we have engineering firms already under contract to AEA and we will be able to request a proposal from them fairly quickly. Gages are installed through USGS and they would want to be informed within the next two weeks due to helicopter availability. Photography and engineering work is in the FY10 budget which we can continue over to the already adopted FY11 budget. Environmental type work and gauging would cost more and will need to be added to the budget so that we may proceed with the work. Salmon have not yet returned as of this date; the reds usually show up in July, pinks maybe late August, and Coho in August or September. We have not lost anything yet this year. In July all fish reruns of concern to the resource agencies will occur and we will not miss much if we proceed now. We'll be looking at many hydro projects during the next few years, so obtaining good data now is important. The fish site characterization can be done in another week or two and we can move forward to request a proposal from the engineering contractors to alert them. The gauges are more important due to helicopter availability time. It's estimated to cost $2 to $2.5 million for permitting and it appears the amendment can be performed as an Environmental Assessment (EA), and not an Environmental Impact Statement Page 5 of 7 BPMC Minutes 6/3/2010 (EIS). The EA would be restrictive only to changes in Battle Creek and the agencies are unlikely to approve it until they have at least two years of data in hand. It was suggested that perhaps we could apply for state grant money for this work. There are no other regulatory matters pending. MOTION: Mr. Posey moved that the Bradley Lake Project Management Committee approve increasing the previously authorized cost of $75,000 for Upper Battle Creek feasibility study and permitting to $300,000; and authorize payment for the project as part of the FY2011 project budget. Seconded by Mr. Griffith. Chair Evans stated he would like the motion to recognize the potential for state grant monies and if the grant were to occur for our large scale hydro project, then grant funds would be used instead. Also, if this year looks good, and the state sees that this is a worthy project that we’ve put some work into, then we can possibly obtain grant money next year to finish the work. There were no objections to proceed with the expansion to the budget. The motion was amended to include the grant wording: MOTION: Move that the Bradley Lake Project Management Committee approve increasing previously authorized cost of $75,000 for Upper Battle Creek feasibility study and permitting to $300,000, recognizing the potential for a grant and there may not be a need to utilize BPMC budget monies; and Authorize payment for the project as part of the FY2011 project budget. A roll call vote was taken: City of Seward: Yes Matanuska Electric Association: Yes Chugach Electric Association: Yes Homer Electric Association: Yes Golden Valley Electric Association: Yes Anchorage Municipal Light & Power: Yes Alaska Energy Authority: Yes The motion unanimously passed. 8C. Soldotna SVC Status Report Soldotna SVC tripped on 6/2/2010 resulting in replacement of two fuses and three capacitors. Daves Creek failed on 5/12/2010 due to a failure of the 124V DC converter, which provides the control voltage to the Swede Water cooling system, affecting the thyristor banks and compounded by the fact that the main SVC control PLC board failed. The input boards have failed before and this is the fourth failure in as many years. There are 20 between Daves Creek and Soldotna. ABB spares are in stock and lead time for replacement boards is about six months at a cost of $16,000. On 5/28/2010, we sent ABB a list of other Daves Creek SVC replacement parts and are waiting for a quote. We do not have spares for some items on this replacement list, which have a lead Page 6 of 7 BPMC Minutes 6/3/2010 time of six weeks. As soon as we hear from ABB we will put out a schedule. We are planning to provide high temperature trip at two locations that doesn’t require the Sweetwater system to be on line for it to trip. The main controller will be wired. It was suggested the O&D Committee review inventory noting the 5/12/2010 event. This matter will be placed on their next agenda. 9. COMMITTEE REPORTS / COMMENTS 9A. Operators Report Daves Creek SVC has been out of service since early May due to leaks in the cooling system for the thyristor banks. Soldotna SVC tripped on 6/2/10 while loading the Kenai-Anchorage Intertie for testing. Outages were completed for annual and biennial scheduled maintenance. The runners are in good condition. Contract was awarded on the Duplex remodel project and the electrical contractor has been on site. A barge shipment arrived 5/26/2010. A pre-bid meeting was held on the runway culvert replacement project, and six or seven bids are expected. Transmission line frost jacking repairs were completed under budget at a cost of about $1 million. The Cascade system was selected for the new work management software replacement and will hopefully be completed at the end of June. The communications hut was removed and transported to Homer where it will be sold. Four FAA cameras are installed and can be seen on FAA's website. The vendor for the oil storage room halon system replacement continues to work with the State Fire Marshal and this should be complete by the end of June. Gate testing is scheduled for 6/21/2010, followed by inspections of the Nuka, Middle Fork & Battle Creek diversions. Photos should be taken of the work to be shared with the BPMC members. 9B. Next Meeting Date The next meeting will be at the call of the Chair. 10. ADJOURNMENT The meeting adjourned at 11:40 a.m. or Evans, Chair o- sales ATTEST: Gat Alaska E| nergy Adithority, Secretary Page 7 of 7 BPMC Minutes 6/3/2010