HomeMy WebLinkAboutATTACHMENTS - 2. NWAB Selawik Solar PV Round 15 Attachments 0-10Northwest Arctic Borough (NAB)
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1 Documentation of match (Village Infrastructure Fund) 3.2.1 2
2 Project team resumes:
● Project Manager: Ingemar Mathiasson
● Project Accountant: Angie Sturm
● Director of Energy Programs: Sonny Adams
● Contractor Lead: Brian Hirsch
● Mechanical Engineer: Leah Olson
4.1 3-8
3 Feasibility study 5.1.1 9-32
4 AVEC Fleet Summary (also includes O&M, diesels off replacement
cost, maintenance schedule)
5.4.2.1 33-35
5 Financial details: 5.4.6 36
● Project capital budget
● Diesels off replacement cost See #4
● O&M cost See #4
6 Northwest Arctic Borough REPOP business plan 7.1.1 37-39
7 AVEC letter of support/intent re. power purchase agreement 7.1.2.2 40
8 Documentation of Support, Commitment: 9 41-46
● NAB Resolution (includes commitment to provide land should
selected site be NAB-owned)
● NANA Regional Corporation
● City of Selawik (includes commitment to provide land should
selected site by City-owned)
● Native Village of Selawik (includes commitment to provide
land should selected site by Tribe-owned)
● Alaska Village Electric Cooperative See #4
9 Documentation of Prior Phases: 11 47-80
● “Reconnaissance - Solar Energy Prospecting in Remote
Alaska - An Economic Analysis of Solar Photovoltaics in the
Last Frontier State” by Paul Schwabe, National Renewable
Energy Laboratory U.S.
● Selawik Solar PV Feasibility Study and HOMER Modeling See #3
10 Additional Documentation: 12 81-127
● Northwest Arctic Borough Regional Energy Plan – 2022
● AVEC Maintenance Schedule See #4
11 B/C Ratio Economic Model 6.1.1 128 on
132
138
The Native Villages of Ambler, Kiana, Noorvik, and Selawik, with support from NANA Regional
Corporation’s Village Energy Program and the Northwest Arctic Borough, approached Alaska
Native Tribal Health Consortium (ANTHC) to identify optimum sizing and expected performance
of high-penetration solar PV and Battery Energy Storage Systems for the communities of
Ambler, Kiana, Noorvik, and Selawik, Alaska. In response, ANTHC performed feasibility
analyses for high-penetration distributed solar-battery hybrid systems to be connected to each
local village electric grid. This project concept, proposed for replication in Ambler, Kiana,
Noorvik, and Selawik, is very similar to the high-penetration solar array and battery system in
Noatak, Alaska that is currently funded and under development, with construction expected to
be complete in 2023. This approach and configuration are quickly becoming the industry
standard for rural Alaska. The technical design also draws heavily from the highly successful
Shungnak-Kobuk, Deering, and Buckland projects in our region that are now performing with
many hours of diesels-off power generation in all three communities. The projects in Shungnak-
Kobuk, Deering, and Buckland were funded in part by the US Department of Energy – Office of
Indian Energy and by the US Department of Agriculture’s High Energy Cost Grant Program.
The solar-battery hybrid systems have also proved their value by utilizing stored power from the
batteries to avert black-outs in the middle of winter, when temperatures can be lower than -40
degrees Fahrenheit. The power reserve in the batteries affords operators the time required to
bring back-up generators online during unplanned generator faults without causing a power
outage.
Solar PV installations have the added benefit of minimal downtime due to mechanical issues.
This has been an important lesson-learned from the Deering and Buckland projects which both
have wind-solar-battery hybrid systems. The combination of the harsh arctic environment and
the limited access to technical experts and replacement parts have resulted in long periods of
downtime when the wind turbines have mechanical or communication malfunctions. Solar PV,
on the other hand, tolerates the harsh arctic weather conditions well and presents few issues.
Although our models accurately capture the low-cost of solar PV maintenance, this added
benefit of minimal downtime, relative to other renewable power installations, is not fully
represented in our financial models, but it is an important consideration in the harsh, remote
environments of Alaskan villages.
To determine if a hybrid solar-battery project was viable and to identify the optimum sizing and
expected performance of each system, ANTHC developed a HOMER model for each village.
Table 1 summarizes the results of the analyses for Ambler, Kiana, Noorvik, and Selawik as
compared to the current diesels-only power system configuration in each village. The detailed
results are provided in the attached feasibility studies which include the HOMER System
Simulation Reports.
139
Feasibility Introduction
Table 1 – Summary of Feasibility Study Results
For each village, Ambler, Kiana, Noorvik, and Selawik, the HOMER model data showed that a
solar-battery hybrid project was technically viable and would add resiliency to each village’s
power system while reducing their reliance on diesel fuel, including some hours of diesels-off
operation. In addition to securing funding, each feasibility study identified confirming the size of
the solar PV array, converter, and battery storge system and finalizing the solar PV array site
location as important next steps in pursuing these projects.
240
Ambler Solar PV and Battery Storage
System Feasibility Study
Prepared For
Ambler Native Village
Airport Way
Ambler, AK 99786
Prepared By
Alaska Native Tribal Health Consortium (ANTHC)
4000 Ambassador Drive
Anchorage, AK 99508
And
DeerStone Consulting
3200 Brookside Drive
Anchorage, AK 99517
December, 2021
41
Purpose of Report
The Native Village of Ambler has expressed interest in developing a utility-scale solar
PV and battery storage system and integrating it into their existing power system. The
purpose of this report is to provide a summary of the HOMER modeling that was
conducted by the Alaska Native Tribal Health Consortium (ANTHC) for the performance
of this type of system in Ambler. The information from this report will be presented to
Ambler Native Village, NANA Energy Program, and Northwest Arctic Borough (NAB) to
assist in determining whether and how to move forward with this energy project.
Background
In Ambler, the only source of electricity comes from diesel generators. The cost of
diesel fuel in Ambler is driven by the price of oil and the cost of delivery. The high cost
of transporting fuel is the primary factor in the high price of fuel Ambler. Much of the fuel
for Ambler must be flown in because the water level in the Kobuk River is often too low
for fuel barges to access the village. As a result, fuel prices in Ambler are often double
that of other nearby villages. In 2020, the average delivered fuel cost was $6.43/gallon
in Ambler as compared to $3.35/gallon in Selawik.
The high cost of diesel fuel, reduced reliance on diesel fuel, and enhanced resiliency of
the power system are factors which motivated the Village of Ambler to explore the
possibility of developing a solar PV with battery storage system.
HOMER Modeling Outcomes
System Sizing
The HOMER model identified the most effective system size to be a 390 kW solar PV
array with a 384 kWh battery energy storage system and a 500 kW converter.
Approximately 3.5 acres will be required to construct a solar array of this size.
Solar Resource
The HOMER model utilized local solar insolation data in combination with the above
system sizing to calculate an expected solar capacity factor of 11.2%. Although the
solar resource is poor during the winter at this latitude due to limited daylight hours, a
solar capacity factor exceeding 10% is an indication that there is a strong solar resource
in Ambler and this is a viable technology when evaluated across all the seasons.
Power Generation and Fuel Savings
A system of this size will generate 298,368 kWh/year and have a solar penetration of
28.7%. Solar penetration is the percentage of electricity that is sourced from solar
generation sources. This will save approximately 22,190 gallons of diesel fuel annually
for an annual fuel cost savings of $142,682. It is estimated that the system will be able
to operate with diesels off for 2,060 hours per year.
Installation Cost and B/C ratio
The estimated cost of installation is $1,150,500 for the solar PV and $1,265,000 for the
battery energy storage system. The total capital cost for this project is estimated to be
$2,415,500. Over the 25-year lifetime of the project, based on Alaska Energy Authority’s
(AEA’s) B/C Ratio Model, the B/C ratio is 1.24.
142
A summary of the HOMER model results is given below. The complete HOMER model
is provided as an attachment.
243
Solar PV Siting
Siting the solar PV panels is an important aspect of developing a successful solar PV
and battery storage project. In particular, it is important to identify a location for the solar
PV panels that is both technically suitable and compatible with the community
development plan.
Land ownership and site control issues are the first considerations in this process. It is
possible to site the panels on land that is owned by either the City or NANA Regional
Corporation. For past projects, NANA has been receptive to navigating site control
issues by first providing villages with land leases, and then having the land surveyed
and transferred to the village afterwards to help reduce immediate barriers to project
progress related to site control.
The next consideration in site selection is the technical feasibility of site. Typically, solar
PV panels are most effective when they are oriented south or southeast. Locating solar
PV panels on elevated land that is at a distance from large buildings will also increase
the effectiveness of the panels by minimizing the shading of the panels. Finally, the
proximity of the solar PV panels to an existing power line will help to reduce the overall
project costs by limiting the need to construct new power lines. According to the sizing
configuration identified by the HOMER model, this installation will require approximately
3.5 acres.
At this stage, Ambler’s community development plan has been taken into account
through discussions with several individuals who are familiar with their plan. In order to
make a final siting determination it is imperative that additional discussions with
members of the community take place to verify that the final site selection is compatible
with Ambler’s community development plan.
Given the above constraints, several site options have been identified that may be
suitable for this project. The below recommendations do not include a full list of possible
sites and they should not be taken as final siting locations. The red star marks the
location of the power plant.
344
Figure 1 - Overview of Ambler Siting Areas
Figure 2 - Ambler Site Area #1 Figure 3 - Ambler Site Area #2
Siting Area #1
This site is located on NANA Regional Corporation owned land and is approximately 5
acres in size. There is minimal shading from nearby buildings and the land is elevated
relative to the rest of the village. There are no known conflicts with Ambler’s community
development plan. This location is the best option identified so far.
Siting Area #2
This site is located on NANA Regional Corporation owned land and is approximately 5
acres in size. There is no shading from nearby buildings and the land to the south is at a
lower elevation. There are no known conflicts with Ambler’s community development
plan. This site would require a significant addition of fill to fully grade the old sewage
lagoon. It is already clear of vegetation. This location is the second-best option identified
so far.
445
Recommendation
From the analysis conducted above, it is expected that, if constructed, this solar PV and
battery energy storage system project would meet the Village of Ambler’s goals of
reducing the high cost of diesel fuel, reducing reliance on diesel fuel, and enhancing the
resiliency of the power system. The B/C ratio for the project is >1 indicating it is a
financially viable project. If the Village of Ambler is interested in pursuing this project the
next steps would be to secure funding and finalize the system size and solar PV siting.
The NANA Energy Program and the Northwest Artic Borough are willing and able to
provide support if Ambler would like to further pursue this project.
Attachments
Ambler HOMER Model – System Simulation Report
546
System Simulation Report
File: Selawik_Solar + Battery.homer
Author: Bailey Gamble
Location: JX3V+H6 Selawik, AK, USA (66°36.2'N, 160°0.4'W)
Total Net Present Cost: $13,729,120.00
Levelized Cost of Energy ($/kWh): $0.381
Notes: Selawik Solar and Battery Energy Storage
Sensitivity variable values for this simulation
Variable Value Unit
Diesel Fuel Price 0.880 $/L
6112
Table of Contents
System Architecture ................................................................................................... 3
Cost Summary ........................................................................................................... 4
Cash Flow ................................................................................................................. 5
Electrical Summary ..................................................................................................... 6
Generator: CMS QST30 750 (Diesel) ............................................................................. 7
Generator: CMS QSX15 G9 499 (Diesel) ........................................................................ 8
Generator: CMS K38G4 1800 900 (Diesel) ..................................................................... 9
PV: Generic flat plate PV ........................................................................................... 10
Storage: Generic 1kWh Li-Ion .................................................................................... 11
Converter: System Converter ..................................................................................... 12
Fuel Summary ......................................................................................................... 13
Renewable Summary ................................................................................................ 14
Compare Economics .................................................................................................. 15
7113
System Architecture
Component Name Size Unit
Generator #1 CMS QST30 750 750 kW
Generator #2 CMS QSX15 G9 499 499 kW
Generator #3 CMS K38G4 1800 900 900 kW
PV Generic flat plate PV 398 kW
Storage Generic 1kWh Li-Ion 383 strings
System converter System Converter 750 kW
Dispatch strategy HOMER Cycle Charging
Schematic
8114
Cost Summary
Net Present Costs
Name Capital Operating Replacement Salvage Resource Total
CMS K38G4
1800 900 $0.00 $530,169 $0.00 -$87,738 $221,354 $663,785
CMS QST30
750 $0.00 $685,172 $0.00 -$97,138 $117,490 $705,525
CMS QSX15 G9
499 $0.00 $1.77M $277,977 -$63,394 $7.54M $9.52M
Generic 1kWh
Li-Ion $598,438 $12,894 $169,268 -$31,858 $0.00 $748,741
Generic flat
plate PV $1.17M $51,452 $0.00 $0.00 $0.00 $1.23M
System
Converter $685,000 $0.00 $190,923 -$35,934 $0.00 $839,990
System $2.46M $3.05M $638,168 -$316,062 $7.88M $13.7M
Annualized Costs
Name Capital Operating Replacement Salvage Resource Total
CMS K38G4
1800 900 $0.00 $41,011 $0.00 -$6,787 $17,123 $51,347
CMS QST30
750 $0.00 $53,001 $0.00 -$7,514 $9,088 $54,575
CMS QSX15 G9
499 $0.00 $136,824 $21,503 -$4,904 $583,235 $736,658
Generic 1kWh
Li-Ion $46,292 $997.40 $13,094 -$2,464 $0.00 $57,918
Generic flat
plate PV $90,822 $3,980 $0.00 $0.00 $0.00 $94,802
System
Converter $52,988 $0.00 $14,769 -$2,780 $0.00 $64,977
System $190,101 $235,813 $49,365 -$24,449 $609,446 $1.06M
-4,500,000
-2,250,000
0
2,250,000
4,500,000
6,750,000
9,000,000
Capital Operating Replacement Salvage Resource
System Converter
Generic flat plate PV
Generic 1kWh Li-Ion
CMS QSX15 G9 499
CMS QST30 750
CMS K38G4 1800 900
9115
Cash Flow
-4,000,000
-3,000,000
-2,000,000
-1,000,000
0
1,000,000
2,000,000
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Salvage
Replacement
Operating
Fuel
Capital
-3,600,000
-2,700,000
-1,800,000
-900,000
0
900,000
1,800,000
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
System Converter
Generic flat plate PV
Generic 1kWh Li-Ion
CMS QSX15 G9 499
CMS QST30 750
CMS K38G4 1800 900
10116
Electrical Summary
Excess and Unmet
Quantity Value Units
Excess Electricity 7,317 kWh/yr
Unmet Electric Load 0 kWh/yr
Capacity Shortage 0 kWh/yr
Production Summary
Component Production (kWh/yr) Percent
Generic flat plate PV 377,253 13.5
CMS QST30 750 36,582 1.31
CMS QSX15 G9 499 2,318,328 82.9
CMS K38G4 1800 900 63,515 2.27
Total 2,795,677 100
Consumption Summary
Component Consumption (kWh/yr) Percent
AC Primary Load 2,787,505 100
DC Primary Load 0 0
Deferrable Load 0 0
Total 2,787,505 100
11117
0
175
350
525
700
kWGenerator: CMS QST30 750 (Diesel)
CMS QST30 750 Electrical Summary
Quantity Value Units
Electrical Production 36,582 kWh/yr
Mean Electrical Output 411 kW
Minimum Electrical Output 107 kW
Maximum Electrical Output 622 kW
Thermal Production 19,513 kWh/yr
Mean thermal output 219 kW
Min. thermal output 91.3 kW
Max. thermal output 308 kW
CMS QST30 750 Fuel Summary
Quantity Value Units
Fuel Consumption 10,328 L
Specific Fuel Consumption 0.282 L/kWh
Fuel Energy Input 101,625 kWh/yr
Mean Electrical Efficiency 36.0 %
CMS QST30 750 Statistics
Quantity Value Units
Hours of Operation 89.0 hrs/yr
Number of Starts 29.0 starts/yr
Operational Life 1,124 yr
Capacity Factor 0.557 %
Fixed Generation Cost 33.5 $/hr
Marginal Generation Cost 0.215 $/kWh
CMS QST30 750 Output (kW)
0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year
12118
0
125
250
375
500
kWGenerator: CMS QSX15 G9 499 (Diesel)
CMS QSX15 G9 499 Electrical Summary
Quantity Value Units
Electrical Production 2,318,328 kWh/yr
Mean Electrical Output 281 kW
Minimum Electrical Output 49.9 kW
Maximum Electrical Output 499 kW
Thermal Production 1,260,991 kWh/yr
Mean thermal output 153 kW
Min. thermal output 55.0 kW
Max. thermal output 245 kW
CMS QSX15 G9 499 Fuel Summary
Quantity Value Units
Fuel Consumption 662,767 L
Specific Fuel Consumption 0.286 L/kWh
Fuel Energy Input 6,521,631 kWh/yr
Mean Electrical Efficiency 35.5 %
CMS QSX15 G9 499 Statistics
Quantity Value Units
Hours of Operation 8,258 hrs/yr
Number of Starts 127 starts/yr
Operational Life 12.1 yr
Capacity Factor 53.0 %
Fixed Generation Cost 23.5 $/hr
Marginal Generation Cost 0.216 $/kWh
CMS QSX15 G9 499 Output (kW)
0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year
13119
Generator: CMS K38G4 1800 900 (Diesel)
CMS K38G4 1800 900 Electrical Summary
Quantity Value Units
Electrical Production 63,515 kWh/yr
Mean Electrical Output 289 kW
Minimum Electrical Output 90.0 kW
Maximum Electrical Output 487 kW
Thermal Production 38,384 kWh/yr
Mean thermal output 174 kW
Min. thermal output 91.0 kW
Max. thermal output 258 kW
CMS K38G4 1800 900 Fuel Summary
Quantity Value Units
Fuel Consumption 19,458 L
Specific Fuel Consumption 0.306 L/kWh
Fuel Energy Input 191,463 kWh/yr
Mean Electrical Efficiency 33.2 %
CMS K38G4 1800 900 Statistics
Quantity Value Units
Hours of Operation 220 hrs/yr
Number of Starts 7.00 starts/yr
Operational Life 455 yr
Capacity Factor 0.806 %
Fixed Generation Cost 35.5 $/hr
Marginal Generation Cost 0.215 $/kWh
CMS K38G4 1800 900 Output (kW)
0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year
0
125
250
375
500
kW14120
PV: Generic flat plate PV
Generic flat plate PV Electrical Summary
Quantity Value Units
Minimum Output 0 kW
Maximum Output 425 kW
PV Penetration 13.5 %
Hours of Operation 4,380 hrs/yr
Levelized Cost 0.251 $/kWh
Generic flat plate PV Statistics
Quantity Value Units
Rated Capacity 398 kW
Mean Output 43.1 kW
Mean Output 1,034 kWh/d
Capacity Factor 10.8 %
Total Production 377,253 kWh/yr
Generic flat plate PV Output (kW)
0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year
0
125
250
375
500
kW15121
75
81.25
87.5
93.75
100
%Storage: Generic 1kWh Li-Ion
Generic 1kWh Li-Ion Properties
Quantity Value Units
Batteries 383 qty.
String Size 1.00 batteries
Strings in Parallel 383 strings
Bus Voltage 6.00 V
Generic 1kWh Li-Ion Result Data
Quantity Value Units
Average Energy Cost 0.221 $/kWh
Energy In 4,326 kWh/yr
Energy Out 3,893 kWh/yr
Storage Depletion 0 kWh/yr
Losses 433 kWh/yr
Annual Throughput 4,104 kWh/yr
Generic 1kWh Li-Ion Statistics
Quantity Value Units
Autonomy 0.963 hr
Storage Wear Cost 0.366 $/kWh
Nominal Capacity 383 kWh
Usable Nominal Capacity 306 kWh
Lifetime Throughput 61,555 kWh
Expected Life 15.0 yr
Generic 1kWh Li-Ion State of Charge (%)
0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year
16122
Converter: System Converter
System Converter Electrical Summary
Quantity Value Units
Hours of Operation 159 hrs/yr
Energy Out 3,698 kWh/yr
Energy In 3,893 kWh/yr
Losses 195 kWh/yr
System Converter Statistics
Quantity Value Units
Capacity 750 kW
Mean Output 0.422 kW
Minimum Output 0 kW
Maximum Output 78.6 kW
Capacity Factor 0.0563 %
System Converter Inverter Output (kW)
System Converter Rectifier Output (kW)
0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year
0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year
0
25
50
75
100
kW0
20
40
60
80
kW17123
Fuel Summary
Diesel Consumption Statistics
Quantity Value Units
Total fuel consumed 692,553 L
Avg fuel per day 1,897 L/day
Avg fuel per hour 79.1 L/hour
Diesel Consumption (L/hr)
Emissions
Pollutant Quantity Unit
Carbon Dioxide 1,811,626 kg/yr
Carbon Monoxide 12,197 kg/yr
Unburned Hydrocarbons 499 kg/yr
Particulate Matter 50.6 kg/yr
Sulfur Dioxide 4,439 kg/yr
Nitrogen Oxides 1,021 kg/yr
0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year
0
50
100
150
200
L/hr18124
Renewable Summary
Capacity-based metrics Value Unit
Nominal renewable capacity divided by total nominal capacity 15.6 %
Usable renewable capacity divided by total capacity 12.9 %
Energy-based metrics Value Unit
Total renewable production divided by load 13.5 %
Total renewable production divided by generation 13.5 %
One minus total nonrenewable production divided by load 13.2 %
Peak values Value Unit
Renewable output divided by load (HOMER standard) 141 %
Renewable output divided by total generation 100 %
One minus nonrenewable output divided by total load 100 %
Instantaneous Renewable Output Percentage of Total Generation
Instantaneous Renewable Output Percentage of Total Load
100% Minus Instantaneous Nonrenewable Output as Percentage of Total Load
0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year 0
25
50
75
100
%0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year 0
40
80
120
160
%0
6
12
18
24
0 30 60 90 120 150 180 210 240 270 300 330 360Hours
Year -30
7.5
45
82.5
120
%19125
Compare Economics
IRR (%):N/A
Discounted payback (yr):N/A
Simple payback (yr):N/A
Base System Proposed System
Net Present Cost $12.0M $13.7M
CAPEX $0.00 $2.46M
OPEX $931,635 $871,906
LCOE (per kWh) $0.334 $0.381
CO2 Emitted (kg/yr) 2,058,973 1,811,626
Fuel Consumption (L/yr) 786,958 692,553
20126
Proposed Annual Nominal Cash Flows
Base System Annual Nominal Cash Flows
Cumulative Discounted Cash Flows
-3,500,000
-2,800,000
-2,100,000
-1,400,000
-700,000
0
700,000
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Proposed System
-1,500,000
-1,250,000
-1,000,000
-750,000
-500,000
-250,000
0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Base System
-15000000-12500000-10000000-7500000-5000000-25000000
0 5 10 15 20 25
Cash Flow ($)year
Base System Proposed System
21127
ENG
MAKE ENG MODEL
OVERHAUL TOP END TUNE UP
OVERHAUL
HOURS
TOP END
HOURS
TUNE UP
HOURS
OIL
CHANGE
HOURS
AC 3500 27,500 14,000 3,000 30,000 15,000 3,500 500
AC 685I 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3208 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3304 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3456 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3508 39,000 19,000 2,500 40,000 20,000 3,000 1,500
CAT 3512 39,000 19,000 2,500 40,000 20,000 3,000 1,500
CAT 3516 39,000 19,000 2,500 40,000 20,000 3,000 1,500
CAT 3306DI 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3306PC 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3406B 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3406BDITA 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3412 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
CAT 3412 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT C27 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT D342 27,500 14,000 3,000 30,000 15,000 3,500 500
CAT D353 27,500 14,000 3,000 30,000 15,000 3,500 500
CMS K19G2 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
CMS K19G2 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
CMS K19G4 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
CMS K38G2 1200 27,500 14,000 3,000 30,000 15,000 3,500 1,500
CMS K38G2 1800 19,000 9,000 2,500 20,000 10,000 3,000 1,500
CMS LTA10 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
CMS LTA10 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
CMS QSK23 G1 19,000 9,000 2,500 20,000 10,000 3,000 500
CMS QSK23 G7 19,000 9,000 2,500 20,000 10,000 3,000 500
CMS QST30 14,000 7,000 2,500 15,000 7,500 3,000 750
CMS QSX15 G9 14,000 6,500 2,500 15,000 7,500 3,000 500
DD S60D3 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
DD S60D3 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
DD S60K4 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
DD S60K4 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
DD S60K4c 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
DD S60K4c 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
DD S60Kc 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
JD 6081HF070 19,000 9,000 2,500 20,000 10,000 3,000 500
JD 6619AF 19,000 9,000 2,500 20,000 10,000 3,000 500
MTU 12V2000 19,000 9,000 4,000 20,000 10,000 5,000 750
MTU 8V2000 19,000 9,000 4,000 20,000 10,000 5,000 750
PER PKXL05-9YHI 19,000 9,000 2,500 20,000 10,000 3,000 500
PER YPKXL03.8AKI 19,000 9,000 2,500 20,000 10,000 3,000 500
11/2019 per Dan Allis MTU oil changes at 750 hours
K-Kohler with Decision Maker 550
Kc-Built to Kohler spec without Decision Maker 550
Correct In Chart
OIL CHANGES
Due every 1500 hours for CAT 3500 series and CMS K38 3/20/2014 kse
Every 500 hours for MTU, etc.3/20/2014 kse
MTU-Publication 6SE2011 Operations Guide Section D Pink at 4,000
Page 40Table 17 Pink at 5000 06R06604Service at 5,000
KT19 1200 Pink at 27,500 for overhaul 3/20/2014 kse
QSK15-Valve adjust 6000 has pink at 5,000
Overhaul Pink at 14,000 3/20/2014 kse
AVEC Maintenance Schedule
TURN PINK AT:Maintenance Schedules
None in Fleet
Page 6A of Publication 3666423 130
Community Diesels off Hours Lifetime Hours Generator Life t of Genset Replcem
Percent Reduction
in Replacement
Costs Total Savings
Annual Savings
over 25 year
project life
Ambler 2060 51500 100000 75,000$ 0.515 38,625$ 1,545$
Kiana 735 18375 100000 75,000$ 0.18375 13,781$ 551$
Noorvik 729 18225 100000 75,000$ 0.18225 13,669$ 547$
Selawik 193 4825 100000 75,000$ 0.04825 3,619$ 145$
Diesels Off Replacement Costs
Community
Battery Capital
Cost
Battery O&M
percentage of Capital
Battery O&M
annual Cost
Solar PV install
Capacity (kW)
O&M rate per
kW installed
Solar PV O&M
Cost
Annual O&M Cost -
Total
Ambler 1,265,000$ 1% 12,650$ 390 20$ 7,800$ 20,450$
Kiana 1,265,000$ 1% 12,650$ 297 20$ 5,940$ 18,590$
Noorvik 1,265,000$ 1% 12,650$ 358 20$ 7,160$ 19,810$
Selawik 1,285,000$ 1% 12,850$ 398 20$ 7,960$ 20,810$
Solar and Battery Annual Operations and Maintenance Cost Estimates
Village Information Engine Data Generator Data
AVEC Fleet Information for Ambler, Kiana, Noorvik, and Selawik
NAME
POS #ENG
MAKE ENG MODEL N ENG
ARRANG #
KW
RATING
GEN
MAKE GEN MODEL GEN SER #PITCH Commissioning
Date
Gen-Set
Controllers
Gen-Set
Hours
AMBLER 1 DD S60K4c 1800 0 6063 TK35 363 KT 4P3-1475 89143-2 0.667 8/9/20 ComAps 1875
AMBLER 2 CMS K19G2 1200 CPL 672 271 KT 6P4-2000 99699-03 0.778 8/25/93 ComAps 7573
AMBLER 3 CMS K19G2 1800 CPL 672 397 NEW HC I504 C1 G980771665 12/5/90 ComAps 73732
KIANA 1 DD S60K4c 1800 0 6063 TK35 324 NEW HC I504 C1L B010213495 9/17/01 ComAps 18239
KIANA 3 DD 14L S60K4 1800 0 6063 HK35 363 MAR 433RSL4021 WA-523718-0300 8/12/19 ComAps 6519
KIANA 4 CMS K19G4 1800 CPL 4153 499 NEW HC I544E1 D990890546 8/1/00 ComAps 9295
NOORVIK 1 DD S60K4c 1800 0 6063 TK35 363 NEW HC I504C1 D960605038 9/27/97 ComAps 12452
NOORVIK 2 CMS K19G4 1800 CPL 4153 499 NEW HC I504F1 C980703086 9/2/16 ComAps 9041
NOORVIK 3 MTU 12V2000 710 MAR 750ROZD4 699449 12/7/03 ComAps 8836
SELAWIK 1 CMS QST30 750 10/3/20 ComAps 47
SELAWIK 2 CMS QSX15 G9 CPL 8142 499 NEW HC I544F 0163207/01 4/12/19 ComAps 75840
SELAWIK 3 CMS K38G4 1800 900 CMS 1000DF JD G960612453 4/14/14 ComAps 18221
129
ENG
MAKE ENG MODEL
OVERHAUL TOP END TUNE UP
OVERHAUL
HOURS
TOP END
HOURS
TUNE UP
HOURS
OIL
CHANGE
HOURS
AC 3500 27,500 14,000 3,000 30,000 15,000 3,500 500
AC 685I 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3208 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3304 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3456 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3508 39,000 19,000 2,500 40,000 20,000 3,000 1,500
CAT 3512 39,000 19,000 2,500 40,000 20,000 3,000 1,500
CAT 3516 39,000 19,000 2,500 40,000 20,000 3,000 1,500
CAT 3306DI 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3306PC 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3406B 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3406BDITA 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT 3412 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
CAT 3412 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT C27 19,000 9,000 2,500 20,000 10,000 3,000 500
CAT D342 27,500 14,000 3,000 30,000 15,000 3,500 500
CAT D353 27,500 14,000 3,000 30,000 15,000 3,500 500
CMS K19G2 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
CMS K19G2 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
CMS K19G4 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
CMS K38G2 1200 27,500 14,000 3,000 30,000 15,000 3,500 1,500
CMS K38G2 1800 19,000 9,000 2,500 20,000 10,000 3,000 1,500
CMS LTA10 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
CMS LTA10 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
CMS QSK23 G1 19,000 9,000 2,500 20,000 10,000 3,000 500
CMS QSK23 G7 19,000 9,000 2,500 20,000 10,000 3,000 500
CMS QST30 14,000 7,000 2,500 15,000 7,500 3,000 750
CMS QSX15 G9 14,000 6,500 2,500 15,000 7,500 3,000 500
DD S60D3 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
DD S60D3 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
DD S60K4 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
DD S60K4 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
DD S60K4c 1200 27,500 14,000 3,000 30,000 15,000 3,500 500
DD S60K4c 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
DD S60Kc 1800 19,000 9,000 2,500 20,000 10,000 3,000 500
JD 6081HF070 19,000 9,000 2,500 20,000 10,000 3,000 500
JD 6619AF 19,000 9,000 2,500 20,000 10,000 3,000 500
MTU 12V2000 19,000 9,000 4,000 20,000 10,000 5,000 750
MTU 8V2000 19,000 9,000 4,000 20,000 10,000 5,000 750
PER PKXL05-9YHI 19,000 9,000 2,500 20,000 10,000 3,000 500
PER YPKXL03.8AKI 19,000 9,000 2,500 20,000 10,000 3,000 500
11/2019 per Dan Allis MTU oil changes at 750 hours
K-Kohler with Decision Maker 550
Kc-Built to Kohler spec without Decision Maker 550
Correct In Chart
OIL CHANGES
Due every 1500 hours for CAT 3500 series and CMS K38 3/20/2014 kse
Every 500 hours for MTU, etc.3/20/2014 kse
MTU-Publication 6SE2011 Operations Guide Section D Pink at 4,000
Page 40Table 17 Pink at 5000 06R06604Service at 5,000
KT19 1200 Pink at 27,500 for overhaul 3/20/2014 kse
QSK15-Valve adjust 6000 has pink at 5,000
Overhaul Pink at 14,000 3/20/2014 kse
AVEC Maintenance Schedule
TURN PINK AT:Maintenance Schedules
None in Fleet
Page 6A of Publication 3666423 130
Units Quantity Rate Total Notes
Solar Panels Each 821 363.75$ 298,639$ Recent Price Experince on Similar Projects
3 SMA Inverters Watt 398,000 0.15$ 59,700$ Recent Price Experince on Similar Projects
Wiring Watt 398,000 0.30$ 119,400$ Recent Price Experince on Similar Projects
Fencing LF 1,600 35.00$ 56,000$ Assumes Chain Link 6 ft
Fiberoptic Cable LF 600 50.00$ 30,000$ Recent Price Experince on Similar Projects
Foundations Watt 398,000 0.35$ 139,300$ PV Mods, Ground Screws
Materials Total 703,039$
Freight Lb 196,133 1.15$ 225,553$ Estimated 2023 Barge Rate - palletized materials
Laborer Hrs 1,800 64.91$ 140,206$ Mini Davis-Bacon, 3 crew, 12 weeks, adjusted for overtime
Electrician 300 95.90$ 35,963$ Mini Davis-Bacon, 5 weeks, adjusted for overtime
Foreman/Operator 720 75.77$ 68,193$ Mini Davis-Bacon, 12 weeks, adjusted for overtime
Total 244,361$
Equipment Weeks 18 3,000$ 54,000$ Local Loader Rental 6 weeks,Local Skid Steer Rental 12 Weeks
Supplies + Tools Lump Sum 21,091$ 3% of Materials
Per Diem + Lodging Man-Days 119 250$ 29,750$ Include lodging and per diem for non-local crew
Travel 11 1,111$ 12,216$ Includes RT flights/travel costs for non local crew
Bonding and Insurance 19,350$
Contractor OH and Profit 129,001$
Construction Total 1,194,000$
Construction Admin 35,820$ 3% of Construction Total
Contingency 122,982$ 10% of Construction + Admin - covers escalation/inflation
Project Management 33,144$ 2.45% of Project Total
Project Total 1,385,945$
Labor
Materials
Detailed Capital Budget
10%
3%
2.45%
1.50%
10.00%
1
Business Plan – Northwest Arctic Borough Regional Performance Optimization Program
Needs Statement
Five high penetration renewable energy – battery storage systems have already been developed in the
region and are owned and operated by Independent Power Producer (IPP) entities under local Tribal
government control. These innovative and early adopter systems have been constructed on the
leading edge of development in Microgrids, demonstrating among the first “diesels-off” operations in
rural Alaska using wind-solar-battery systems. However, challenges with integration and optimization
have reduced total benefits.
The sophisticated controls required for operating within the micro-grids sometimes result in
shutdowns or reduced performance. As a result, tens of thousands of dollars in revenues are lost,
thousands of additional gallons of diesel are burned, and potentially avoided tons of C02 are emitted.
Establishing a program with dedicated resources to provide optimization services from qualified
engineering and trades professionals will increase renewable energy generation, reduce diesel fuel
consumption, and maximize revenue generation and reduce electric costs for the community.
Proposed Solution
This project will create the Northwest Arctic Renewable Energy Performance Optimization Program
(REPOP) hosted by the Northwest Arctic Borough and supported by the NANA Regional Corporation.
This program will provide a .75 FTE coordinator at the NWAB for three years to support and optimize
performance of the six renewable-battery systems in the region (including Selawik’s proposed system).
The three-year timeframe will allow Selawik to participate and benefit in ongoing training and
performance optimization for one year after construction of the solar-battery system. This work will
include coordination of training for local operators, data collection and recording, and management of
specialty engineering, mechanical and electrical contractors as needed to support each high
penetration renewable energy system.
A Memorandum of Agreement would be signed with each IPP identifying the agreed upon services to
be carried out by the REPOP, and the amount of fees to be paid by the IPP. Currently the Northwest
Arctic Borough serves as the Fiscal sponsor for each IPP, so management and maintenance of the
accounts would be streamlined and transparent.
Staffing and Service Plan
The NWA Borough will either contract with a partner organization such as Kotzebue Electric Association,
a qualified contractor, or hire an employee to work in the Borough Energy Department to complete the
role of “Optimization Coordinator”. This person will have the following duties:
• Use remote monitoring software to observe and document performance.
• Coordinate with Utility Operators and IPP Operators to identify and address challenges.
• Establish contracting relationships with qualified technical support for use by all participating
IPP’s.
o These technical support contractors will potentially include Electrical Controls
contractors such as ABB - Hitachi, Siemens or similar, Micro-Grid consultants such as
DeerStone consulting, and/or qualified electrical contractors.
2
• Identify and direct contractor support resources to participating IPP’s to address challenges and
improve performance of systems.
• Assist communities, utilities, and IPP’s in documenting, defining, and developing opportunities
to expand and improve existing and future IPP’s in the region.
Estimated Financials – Renewable Energy Performance Optimization Program
Below financials represent the estimated annual costs for carrying out the services of the REPOP
initiative. During the period of the REPP, grant funds will help to establish the program and prove
benefits of participation to the multiple IPP entities in the region. After establishment of value of the
program, IPP’s will provide annual fees for continuation of the service. Fees are estimated only and
could scale with need; actual costs may vary and will be determined during the period of the REPP
project.
Performance Optimization
Program
Years 1-3 Years 4 - 20
Estimated Annual Revenue $ 191,730 $ 200,000
Fee for Service Collection $ 49,140 $ 200,000
Deering $ 10,000 $ 25,000
Buckland $ 10,000 $ 25,000
Shungnak $ 15,000 $ 25,000
Noatak $ 4,140 $ 25,000
Buckland $ 10,000 $ 25,000
Selawik $ - $ 25,000
Additional IPPS (Ambler, Kiana) $ - $ 50,000
REPP Grant Funds $ 132,890
NANA Regional Corporation $ 9,700 $ 0
Expenses $ 191,730 $ 200,000
Coordinator $ 98,280 $ 101,613
Travel Support - Coordinator $ 9,000 $ 11,250
Training - ATC $ 9,000 $ 10,350
Travel Support - Operators $ 11,750 $ 14,688
Technical Support - Contractors $ 54,000 $ 62,100
NANA Regional Corporation $ 9,700
Net Income $ - $ -
It’s assumed that additional participating IPP’s will be developed over the next several years, as
participating partners in the REPP continue efforts to fund and develop renewable energy IPP’s in each
community in the region. It is assumed that additional IPP’s will require additional services, but that the
cost/community will decline with economies of scale and early significant support from the initial
participating IPP’s. It should be noted that this basic assumption is already bearing out in the recent
3
securing of funding for design and engineering of four solar PV – battery projects in communities across
the region, which will reduce costs and streamline construction of future systems in those communities.
NANA Regional Corporation will provide technical assistance and coordination in establishing
agreements and maintain the progress of the program over the first three years. NANA will provide all
funding for this support.
Estimated Financials – Participating Tribal Independent Power Producers
Estimated annual revenues currently generated by participating IPP’s are identified in the table below. It
is assumed that after participation in REPOP, additional revenues will be realized through increased kWh
production and sales through power purchase agreements to local utilities.
Annual costs are identified in total across the individual IPP’s and are estimated to provide a 10 hours
per week part time operator to maintain the installed systems, a 15% admin fee per tribal IPP and
$5,000 in spare parts annually. All “profits” beyond these costs are assumed to be maintained for capital
replacement costs or expansion of the systems.
IPP Estimated Annual Revenues Years 1-3 Years 4 - 20
Deering $ 35,000 $ 45,000
Buckland $ 35,000 $ 45,000
Shungnak $ 65,000 $ 70,000
Noatak $ 75,000 $ 85,000
Selawik $ 25,000 $ 100,000
Additional IPPS (Ambler, Kiana) 0 $ 140,000
Total $ 235,000 $ 485,000
IPP Estimated Annual Costs Years 1-3 Years 4 - 20
Operator Wages $ 91,000 $ 127,400
Spare Parts $ 25,000 $ 35,000
Fee for Service - POP $ 49,140 $ 200,000
Tribal Overhead and Admin $ 24,771 $ 54,360
Capital Replacement Savings $ 45,089 $ 68,240
Total $ 235,000 $ 485,000
Solar Energy Prospecting
in Remote Alaska
An Economic Analysis of Solar Photovoltaics
in the Last Frontier State
by Paul Schwabe, National Renewable Energy Laboratory
U.S. Department of Energy | Office of Indian Energy
1000 Independence Ave. SW, Washington DC 20585 | 202-586-1272
energy.gov/indianenergy | indianenergy@hq.doe.gov
5
Solar Energy Prospecting in Remote Alaska
ii
NOTICE
This report was prepared as an account of work sponsored by an agency of the United States government. Neither the
United States government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or
assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus,
product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to
any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not
necessarily constitute or imply its endorsement, recommendation, or favoring by the United States government or any
agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United
States government or any agency thereof.
Available electronically at SciTech Connect http:/www.osti.gov/scitech
Available for a processing fee to U.S. Department of Energy
and its contractors, in paper, from:
U.S. Department of Energy
Office of Scientific and Technical Information
P.O. Box 62
Oak Ridge, TN 37831-0062
OSTI http://www.osti.gov
Phone: 865.576.8401
Fax: 865.576.5728
Email: reports@osti.gov
Available for sale to the public, in paper, from:
U.S. Department of Commerce
National Technical Information Service
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NTIS http://www.ntis.gov
Phone: 800.553.6847 or 703.605.6000
Fax: 703.605.6900
Email: orders@ntis.gov
energy.gov/indianenergy | indianenergy@hq.doe.gov
DOE/IE-0040 • February 2016
Cover photo from Alamy EPC220. Credit to Design Pics Inc / Alamy Stock Photo.
6
Solar Energy Prospecting in Remote Alaska
iii
Acknowledgements
This work is made possible through support from the U.S. Department of Energy’s Office of Indian Energy
Policy and Programs. The author would like to thank Christopher Deschene, Givey Kochanowski and
Douglas Maccourt for their support of this work. The author would also like to thank the following reviewers
for their insightful review comments: Robert Bensin of Bering Straits Development Company; Brian Hirsch
of Deerstone Consulting; David Lockard of Alaska Energy Authority; Ingemar Mathiasson of Northwest
Arctic Borough; David Pelunis-Messier of Tanana Chiefs Conference; and Erin Whitney of Alaska Center for
Energy and Power. The author also wishes to thank Elizabeth Doris, Sherry Stout, and Jared Temanson of the
National Renewable Energy Laboratory (NREL) for their strategic guidance throughout this effort as well as
Jeffrey Logan and David Mooney, of NREL, for their insightful review of the document. The author is
grateful for the technical editing of Heidi Blakley, Karen Petersen, and Rachel Sullivan of NREL. Finally the
author also wishes to thank Jared Wiedmeyer for assistance with development of the analytical model and
Pilar Thomas for her guidance and support early in this work. The author is solely responsible for any
remaining errors or omissions.
7
Solar Energy Prospecting in Remote Alaska
iv
List of Acronyms
AEA Alaska Energy Authority
Btu British thermal unit
kW kilowatt
kWh kilowatt-hour
LCOE levelized cost of energy
m2 square meter
MW megawatt
NREL National Renewable Energy Laboratory
O&M operations and maintenance
PCE Power Cost Equalization
PV photovoltaic
W watt
8
Solar Energy Prospecting in Remote Alaska
v
Table of Contents
Introduction ..................................................................................................................................... 1
Analysis Description and Limitations ............................................................................................ 7
Analysis Limitations ........................................................................................................................ 8
Data Input Assumptions: Diesel Generation Costs, Solar Costs, and Solar Resource
Estimates ............................................................................................................................... 11
Input Parameters for Diesel Generation Costs .......................................................................... 11
Input Parameters for Solar Electricity Generation ..................................................................... 13
Summary of Input Assumptions .................................................................................................. 17
Analysis Results ........................................................................................................................... 20
Conclusion ................................................................................................................................... 22
References ................................................................................................................................... 23
Appendix A. Model Overview and Description ........................................................................... 27
Appendix B. Levelized Cost of Energy Results ........................................................................... 28
9
Solar Energy Prospecting in Remote Alaska
vi
List of Figures
Figure 1. Solar resource comparison of Alaska and Germany .................................................... 2
Figure 2. Annual solar production percentage across four regions in Alaska by month ........... 3
Figure 3. Solar PV installations at water treatment facilities in the remote villages of
Ambler, Shungnak, Deering, and Kobuk, Alaska ................................................................... 5
Figure 4. The seasonal sun paths of Kotzebue, Alaska, and Denver, Colorado ..........................
Figure 5. Villages included in solar analysis ................................................................................. 7
Figure 6. PV Installations in Nome and Galena ..............................................................................
Figure 7. Average wholesale diesel prices in $/gal for the 11 villages tested in 2013
and 2014 ............................................................................................................................... 12
Figure 8. Screenshot and callout of diesel fuel purchases in Anaktuvuk Pass, Alaska ......... 13
Figure 9. PVWatts solar resource estimate tool screenshot for Adak, Alaska ........................ 14
Figure 10. PVWatts solar resource estimate tool for a 100-kW PV system in Adak, Alaska .. 15
Figure 11. Indexed diesel and solar PV prices from 2002 to 2015 .............................................
Figure 12. Servicing a PV system in remote Alaska .................................................................. 17
Figure 13. Cost of electricity comparison between solar PV and diesel generation .............. 21
Figure 14. Schematic of LCOE model used in this analysis ..................................................... 27
List of Tables
Table 1. Cost Estimates for a 100-kW PV System .................................................................... 17
Table 2. Annual Solar Energy Estimates .................................................................................... 18
Table 3. Wholesale Diesel Fuel Costs for Electricity Generation ............................................. 19
Table 4. Solar PV LCOE Modeling Results ................................................................................. 28
10
Solar Energy Prospecting in Remote Alaska
1
Introduction
Exploitation and utilization of energy resources within the state of Alaska has predominantly and historically
centered on its abundance of fossil-fuel deposits including oil, natural gas, and coal. Within the last decade,
however, renewable energy technologies have been deployed across the state for both demonstration purposes
and commercial ventures (REAP 2016). This diversification of energy sources has been driven from at least
three primary factors: (1) the economic exposure of many Alaskan communities to oil price fluctuations and
other petroleum market influences (2) technological advancements and reductions in the cost of renewable
energy equipment, and (3) efforts to improve self-sufficiency for remote Alaskan communities. Due to these
factors and more, renewable energy resources are increasingly being considered to meet Alaska’s energy
needs (Foster et al. 2013).
Renewable energy technologies used in Alaska have included small and large hydroelectric facilities, utility-
scale and distributed wind generation, geothermal and air heat pumps, and woody biomass for electricity and
heating (REAP 2016, CCHRC 2016). In addition to these endemic natural resources, a previously dismissed
but pervasive form of renewable energy is also increasingly being analyzed and deployed in Alaska: solar
electricity generated from photovoltaic (PV) panels.
The lack of historical solar energy development in Alaska is due to a multitude of factors, but not surprisingly
starts with one fundamental problem: minimal to no sunlight in the winter months, particularly for the
northern latitudes. Of course, Alaska also experiences prolonged and sunlight rich summer days, but many of
the biggest energy needs arise during the cold and dark months of winter. Despite this seemingly obvious
barrier for solar electricity in Alaska, upon deeper examination there are several factors that may support the
deployment of solar energy in particular locations across the state.
First, Alaska is an immense state with a large geographic range along both the north-to-south and east-to-west
directions. Many Alaskans will proudly and dryly note that if one was to hypothetically cut the state into two,
Texas would be only the third largest state in the Union. This expansive and diverse geographic range means
that there are significant differences in both the amount and seasonal variation of the solar resource across the
state. Additionally many of the meteorological conditions experienced in certain regions of Alaska can
actually be beneficial to solar energy production, including low ambient temperatures that improve the
efficiency of solar modules and the reflectivity of sunlight off of snow cover on the ground. As shown in
Figure 1, the solar resource (i.e., the amount of solar insolation received in kilowatt-hours (kWh)/square
meters (m2)/day) in some regions of Alaska is at-least comparable to that of Germany, which leads the world
in PV installations with more than 38,500 megawatts (MW) of solar installed as of October 2015 (Wirth
2015).1
1 To put 38,500 MW in perspective, with a population of roughly 80 million, Germany has installed approximately 480 watts (W) of
PV per capita, or roughly two average-sized 250-W PV panels for every person in the country.
11
Solar Energy Prospecting in Remote Alaska
2
Figure 1. Solar resource comparison of Alaska and Germany 2
Source: Billy J. Roberts, National Renewable Energy Laboratory (NREL)
Second, both the expected monthly solar production and the seasonal load profile of communities can vary
significantly across Alaska, meaning some communities may be better suited for solar production than others.
Figure 2 shows the percentage of expected annual solar production by month across the Arctic, Interior,
Southwest, and Southeast geographic regions of Alaska.3 The Arctic and Interior regions of Alaska could
2 This map was produced by NREL for the U.S. Department of Energy. Annual average solar resource data are for a solar collector
oriented toward the south at tilt equal to local latitude. The data for Alaska is derived from a 40-km satellite and surface cloud cover
database for the period of 1985 to 1991. The data for Germany was acquired from the Joint Research Centre of the European
Commission and is the average yearly sum of global irradiation on an optimally inclined surface for the period of 1981 to 1990.
3 For comparison to Figure 1, each region’s specific solar insolation measure is also shown in the figure heading.
12
Solar Energy Prospecting in Remote Alaska
3
expect high solar production predominantly from March through August, with a steep drop off in the shoulder
months and little to no production in the winter. The Southeast and Southwest regions of Alaska show a more
gradual transition of solar production levels from the sunlight rich spring and summer months to the
shortening days of fall and winter. Although the electricity load peaks for many Alaska Native villages in the
winter months when solar is minimally producing, these villages are also often running primarily on diesel-
based generation during summer months for basic electricity needs such as lighting, refrigeration, cooking,
and electronics when solar PV energy could offset fossil-fuel consumption. Furthermore, despite the cold and
dark winters in Alaska that result in high energy demands, some Alaska communities have summer-peaking
energy demands primarily because of commercial fishing activities and higher seasonal populations in the
summer, which is generally compatible with solar availability.4
Figure 2. Annual solar production percentage across four regions in Alaska by month
Source: NREL 2015
Lastly, and perhaps most significantly, Alaska has more than 175 remote village populations that rely almost
exclusively on diesel fuel for electricity generation and heating oil for heat (Goldsmith 2008, AEA 2014a).
Although oil is extracted in the North Slope of Alaska, the in-state production does not result in a below
4 Additionally, Sidebar 1 compares the path of the sun in the village of Kotzebue, Alaska to Denver, Colorado, to illustrate solar
production in the Arctic region with a reference point in the contiguous 48 states.
0%
4%
15%
17%17%
14%15%
10%
5%
3%0%0%
J F M A M J J A S O N D
Arctic Alaska Annual Solar Production
Percentage by Month (2.3 kWh/m2/day)
1%2%
11%
12%
14%14%15%
13%
7%7%
2%1%
J F M A M J J A S O N D
Interior Alaska Annual Solar Production
Percentage by Month (3.4 kWh/m2/day)
3%
9%
13%14%
12%
11%10%
8%7%
6%
4%
3%
J F M A M J J A S O N D
Southwest Alaska Annual Solar Production
Percentage by Month (3.1 kWh/m2/day)
3%
5%
11%
14%15%
9%
14%
10%
8%
5%5%
2%
J F M A M J J A S O N D
Southeast Alaska Annual Solar Production
Percentage by Month (3.1 kWh/m2/day)
13
Solar Energy Prospecting in Remote Alaska
4
market price for oil within the state. Chris Rose, Renewable Energy Alaska Project Executive Director notes,
“We [Alaskans] pay the world commodity oil price. We’ve never received some sort of ‘hometown’ discount
for oil.” (Gerdes 2015). Unprocessed crude oil extracted within the state is transported via the TransAlaska
pipeline from the North Slope to refineries in the Interior and South-Central regions of Alaska and then
delivered locally as diesel and gasoline to rural communities a few times per year. Most fuel deliveries to
remote communities are made via barge, ice road, or air transport, which also contributes to the high local
prices for diesel and gasoline.5 The local markup to retail pricing also adds to the “all-in” prices for fuel in
rural villages. Due to these and other factors, electricity generated by diesel fuel in some rural communities
can be $1.00/kilowatt-hour (kWh) or more, which is more than 8 times the national average of $0.12/kWh
(AEA 2014a, EIA 2014). As described later in this report, the State of Alaska has enacted various programs
for both renewable and diesel energy sources to help reduce the energy costs in rural Alaska, but many of
these programs are limited to certain sectors, or are increasingly under scrutiny with the budget difficulties
being experienced by the state (AEA 2016a, AEA 2016b, Johnson 2015).
For these reasons and more, alternative forms of electricity generation including solar PV are increasingly
being pursued in remote Alaska communities (see Figure 3 for examples of solar PV recently installed in the
Northwest Arctic Borough). This analysis provides a high-level examination of the potential economics of
solar energy in rural Alaska across a geographically diverse sample of remote villages throughout the state. It
analyzes at a high level what combination of diesel fuel prices, solar resource quality, and PV system costs
could lead to an economically competitive moderate-scale PV installation at a remote village. The goal of this
analysis is to provide a baseline economic assessment to highlight the possible economic opportunities for
solar PV in rural Alaska for both the public and private sectors.
5 The cost of transportation is even more pronounced in regions that require regular fuel deliveries via air shipments, if for example,
barge or ice road transport is unavailable due to freezing, thawing, low runoff, high silting, or other conditions.
14
Solar Energy Prospecting in Remote Alaska
5
Figure 3. Solar PV installations at water treatment facilities in the remote villages of Ambler,
Shungnak, Deering, and Kobuk, Alaska 6
Source: Mathiasson 2015b, Northwest Arctic Borough
6 Clockwise from top left, the 8.4-kW Ambler array uses a pole-mounted array design and the 7.5-kW Shungnak installation utilizes a
roof-mounted design with 90° directional offsets. The 11.55-kW and 7.38-kW design in Deering and Kobuk respectively incorporate a
180° circular system design that wraps around the east, south, and west facing walls of water treatment towers. These designs are
utilized to even out the daily solar production profile (compared to systems installed facing just to the south) which can ease
integration with existing diesel generators.
15
Solar Energy Prospecting in Remote Alaska
6
Sidebar 1. Seasonal Sun Path in Kotzebue, Alaska, Compared to Denver, Colorado
The state of Alaska is well known for its long summer days and prolonged winter nights. Given the immense size of the
state from the Northern to Southern latitudes, however, there is a wide range of expected daylight hours throughout the
state. For example, on the shortest day of the year the capital city of Juneau located in the South can expect 6 hours, 22
minutes of daylight while the Northern city of Barrow is in the midst of 67 straight days of total winter darkness
(Alaska.org 2015). To highlight the seasonal sun path variations of one region of Alaska compared to a representative
point in the contiguous 48 United States (lower 48 states), Figure 4 below shows the sun’s path for Kotzebue, Alaska,
located in the Northwest Arctic Borough, compared to Denver, Colorado, which is an approximate latitudinal mid-point of
the lower 48 states. This figure shows both the spring and fall equinoxes when the total length of day and night are
equal across the globe and the summer and winter solstices when the longest and shortest days of the year occur.
The path of the sun’s altitude for Kotzebue illustrates how the sun never falls completely below the horizon on the
summer solstice, while on the winter solstice, it never quite rises above. The shape of the sun’s path for Kotzebue also
illustrates a flatter and more gradual curve compared to the relatively steep curve for Denver. While solar electricity
production in Kotzebue would be minimal during the winter months, the long summer days would provide a period of
extended production. The spring and fall months would also produce a moderate amount of solar electricity and benefit
from low ambient temperatures and increased production from sunlight reflected off of snow cover on the ground.
Figure 4. The seasonal sun paths of Kotzebue, Alaska, and Denver, Colorado
Source: Suncalc 2015 with visual concept adapted from Time and Date 2015
16
Solar Energy Prospecting in Remote Alaska
7
Analysis Description and Limitations
This analysis examines the economics of solar electricity at a sampling of 11 remote villages across the state.
The villages were selected to represent major geographical regions across the state including the Arctic Slope,
the Interior, the Southwest, the Southeast, and the Aleutian Islands. In general, these regional variations were
selected to capture the variations in meteorological conditions across the state, different delivery options, and
possible ranges in diesel fuel prices. All of the villages are off of Alaska’s road system. The villages included
in this analysis include Adak, Ambler, Anaktuvuk Pass, Hughes, Kasigluk, Shungnak, St. Paul, Tenakee
Springs, Venetie, Yakutat, and Wainwright. Figure 5 shows the location of each of the 11 villages across the
state and their estimated solar insolation.
Figure 5. Villages included in solar analysis 7
Source: Billy J. Roberts, NREL
7 This map was produced by NREL for the U.S. Department of Energy. Annual average solar resource data are for a solar collector
oriented toward the south at tilt equal to local latitude. The data is derived from a 40-km satellite and surface cloud cover database for
the period 1985–1991.
17
Solar Energy Prospecting in Remote Alaska
8
The analysis uses the levelized cost of electricity (LCOE) as a metric to compare the costs of solar electricity
to diesel fuel rates, reported in cents per kilowatt-hour. LCOE is a metric that takes the entire lifecycle
expenditures of an energy technology including capital costs, transportation, operating, and fuel costs (zero
for solar) discounted to the present term and divided by the expected annual energy production of the energy
system. While there is not a single universally accepted definition or methodology to calculate LCOE, in its
basic form LCOE is often used to compare the cost of different energy technologies that can have very
different cost and generation profiles (i.e., capital intensive versus operational intensive, project life, fuel
costs, etc.). A common criticism for LCOE is that it does not differentiate between energy sources that are
generally considered non-variable such as diesel generation from variable energy sources such as wind or
solar energy. Moreover, project-level feasibility and economic evaluations are not typically made with just
one metric, but instead incorporate a variety of analytical criteria including LCOE, net present value, internal
rate of return, payback period, and a benefit to cost ratio, among others. For these reasons and more, LCOE is
a useful though not singular metric to compare the cost of solar to the fuel-only cost of diesel generation (EIA
2015).8
To conduct the analysis, a spreadsheet-based pro-forma tool was created to calculate the LCOE for solar PV
systems. This model was based on a simplified version of NREL’s Cost of Renewable Energy Spreadsheet
Tool that allows for basic LCOE evaluations and includes capital, operating, and financial costs, performance
and inflation adjustments, as well federal, state, and local policy support schemes (NREL 2011). This model
includes the ability to model the economically significant federal tax benefits given to solar energy
technologies such as the 30% investment tax credit and accelerated depreciation. The model used in this
analysis was tested and reviewed by two outside entities.9 See Appendix A for more information on the model
used in this analysis.
Analysis Limitations
It is important to note that there are many factors that will impact both the technical and economic
characteristics of solar electricity, which are beyond the scope of this initial analysis. From a technical
standpoint, this analysis does not explicitly consider the impact of integrating high penetration levels of
variable solar electricity with a baseload diesel generation system. Instead, this analysis makes a few
simplifying assumptions on integrating solar and diesel generation:
•First, the analysis assumes that a kilowatt-hour produced from solar electricity is able to offset a
kilowatt-hour produced from diesel generation. This one-to-one offset may not always be achievable
as diesel generators are often most fuel-efficient at a given power level and generation from PV could
impact the generator’s power level and thus fuel efficiency. Moreover, because diesel generators
provide both energy (i.e., kilowatt-hours of generation) as well as other grid services such as voltage
and frequency regulation, this analysis assumes that some level of diesel generation will always be
running for grid operations and is not attempting to model a “diesel-off” scenario.
•Second, the analysis also assumes the PV system would be sized small enough relative to the existing
diesel generator to not require extensive energy storage systems (i.e., batteries) to integrate the solar
8 See the Data Input Assumptions Section for why only the fuel-cost component of diesel fired generation is used in this analysis.
9 These entities include the original developers of the Cost of Renewable Energy Spreadsheet Tool at Sustainable Energy Advantage
and researchers at the Institute of Social and Economic Research at University of Alaska Anchorage.
18
Solar Energy Prospecting in Remote Alaska
9
and diesel generators.10 As shown previously in Figure 3, the Northwest Arctic Borough recently
installed a series of PV arrays at water treatment plants in remote regional villages using PV system
designs that smooths the daily solar generation profile and thus integrates more easily with the
existing diesel generators. Furthermore, comparatively smaller integration upgrades such as advanced
power electronics and controls installed at either the diesel powerhouse or at the PV system are
assumed to be utilized and implicitly included into the all-in PV system price. As an example, a 2014
study conducted by the Alaska Center for Energy and Power found that a remote Alaskan village with
a peak load of about 1.1 MW could accommodate a 135-kW PV system with no control system
upgrades, and a 205-kW PV system with some control system upgrades (Mueller-Stoffels 2014).11
Conversely, whole system upgrades, or a new, but smaller diesel generator is not assumed to be
included in the all-in PV system price.
From an economic standpoint, this analysis also does not attempt to examine the interplay of state-derived
financial relief of diesel fuel purchases by remote villages through its Power Cost Equalization (PCE)
program. Instead it makes a simplifying assumption that PV would be targeted at installations not eligible for
PCE such as commercial businesses, schools, or state or federal buildings.12 Although the simplifying
assumptions incorporated here are useful for the purposes of this high-level investigation, more research is
required in order to further refine the analysis and provide project-specific economic feasibility.
10 Existing research has attempted to quantity what levels of PV integration would require extensive integration costs for a single
village, though more investigation is required for broader applicability (Jensen et al. 2013, Mueller-Stoffels 2015).
11 The range of installed costs for the PV systems described in the Data Inputs Assumptions Section is likely sufficiently wide enough
to include at least one case where the control upgrades are included in the PV system pricing.
12 See Sidebar 2 for more information on the Power Cost Equalization program.
19
Solar Energy Prospecting in Remote Alaska
10
Sidebar 2. Power Cost Equalization and Renewable Energy
In Alaska, a long-standing state policy program known as Power Cost Equalization attempts to equalize
electricity costs between high-cost rural communities with comparatively cheaper urban population centers
connected by the rail and road system from Fairbanks in the Interior through Anchorage to Homer in the South-
Central region (known as the “Railbelt”) and Juneau in the Southeast. The PCE program provides significant
financial relief to many of the rural communities throughout Alaska, in particular those not on the rail or road
system, by using a state endowment fund to subsidize rural electricity rates to be in-line with rates experienced
in the Railbelt and Southeast Regions. Although several components contribute to the PCE rate amount, a
sizable portion of it is determined from the cost of diesel fuel used to generate electricity in eligible remote
Alaskan communities (AEA 2014b). In this sense the PCE has been suggested by some as a financial
disincentive for rural Alaskan communities to reduce their diesel dependency as doing so can also reduce the
amount of PCE financial support (Hirsch 2015, Fay et al. 2012). Others note that the impacts from a renewable
energy installation on PCE payments can be more pronounced on certain customer classes than others and a
more nuanced assessment is appropriate (Drolet 2014). In any case, the current PCE structure has
unquestionably led to a debate around if, how, and to what extent the economic value of renewable energy—
principally the ability offset diesel fuel costs—is restricted by the PCE.
As mentioned above, this analysis does not dive into the complex assessment of determining the net impact of
renewable energy to diesel savings to PCE subsidies at the village level. Instead it makes a simplifying
assumption that under the current PCE structure, the solar installation is logically targeted at a facility not
currently eligible for PCE. These non-PCE eligible facilities include schools, local businesses such as a village or
Native corporation, or state and federal facilities (AEA 2014b). An early example of this type of installation is the
16.8-kW system installed at Bering Straits Native Corporation in Nome in 2008, shown on the left in Figure 6
(AEA 2016c). Another example is the 6.7-kW PV project (originally installed in 2012 and expanded to more than
10 kW in 2015) developed on the school in Galena, Alaska, shown on the right in Figure 6 (Galena 2012,
Pelunis-Messier 2015). Given that schools are among the largest energy users at many remote village
communities, schools seem like an especially likely candidate for solar PV installations without impacting PCE
as it is currently structured.
Figure 6. PV Installations in Nome and Galena
Source: AEA 2016c and Pelunis-Messier 2015
20
Solar Energy Prospecting in Remote Alaska
11
Data Input Assumptions: Diesel Generation Costs, Solar Costs, and
Solar Resource Estimates
This section briefly describes each of the data sources used for this analysis and presents the range of input
cost parameters tested.
Input Parameters for Diesel Generation Costs
For diesel-based generation, this analysis focuses principally on the costs attributed to purchasing and
transporting the diesel fuel used to run the village’s electricity generators (i.e., “fuel costs”). Other fixed costs
(i.e., “non-fuel costs”) also contribute to the overall electricity prices; however, because these non-fuel costs
would likely not be offset by adding solar generation, they are ignored for purposes of this analysis.13
Examples of non-fuel costs excluded from this analysis are the capital and operations and maintenance
(O&M) costs for a diesel generator and a utility’s administrative charges.
The costs for wholesale diesel fuel prices in remote Alaskan villages are comprehensively reported by the
Alaska Energy Authority (AEA) in their annual report “Power Cost Equalization Program Statistical Data by
Community” for the years 2013 and 2014 (AEA 2014a, AEA 2015).14 Utility purchases of diesel fuel for
electricity generation at remote villages are typically made at wholesale rather than retail rates. The 11
villages included in this analysis present a wide range of wholesale diesel fuel costs. For example, wholesale
diesel fuel prices range from a low of $3.95/gallon (gal) in Wainwright up to $6.90/gal in Ambler in 2014.
Figure 7 shows the diesel fuel prices distribution for the years 2013 and 2014 for each of the 11 villages tested
(AEA 2014a, AEA 2015).15 There was no consistent trend for fuel prices across the 11 villages from 2013 to
2014. Some village’s diesel fuel prices stayed relatively flat or even decreased while others increased
substantially. This price variation could be due to several factors including oil commodity price fluctuations
throughout the course of the year, fuel purchase prices that may or may not have been locked-in a year or
more in advance, cost factors from logistical and transportation challenges from one year to the next,16 or
simple reporting errors.17 Given these cost fluctuations from year to year, this analysis uses the reported diesel
price points for a village as illustrative rather than precise.
13 See the Analysis Description and Limitations Section for a discussion on the costs associated with integrating the diesel and solar
systems.
14 The reporting period for this report is through the end of June in the preceding year. Prices are shown in nominal dollars.
15 The years 2013 and 2014 were included in the analysis as these were the only years that a comprehensive data source with a
consistently applied methodology was available. Note that the 2015 version of the AEA Power Cost Equalization Program Statistical
Data by Community report was released in February 2016, shortly before the publication of this report (AEA 2016d). The analysis in
this report does not incorporate the AEA 2015 data.
16 Ambler and Shungnak, for example, receive fuel shipments via barge in some years and through air transport in others.
17 Note, for example, that several reviewers suspected that a few of the outlying statistics presented in AEA 2014a and AEA 2015
were likely due to imperfect reporting or other data errors (particularly for Hughes in 2013) but generally acknowledged that these
data reports are among the best available sources at this time.
21
Solar Energy Prospecting in Remote Alaska
12
Figure 7. Average wholesale diesel prices in $/gal for the 11 villages tested in 2013 and 2014
Source: AEA 2014a and AEA 2015
Although the most familiar reporting term for diesel fuel prices is in dollars per gallon, in the context of
electricity generation a different cost metric is used here. AEA reports the “fuel cost per kilowatt-hour sold”
($/kWh) metric for any village that receives energy price support through the PCE program. Figure 8 shows a
screenshot and callout of the fuel cost per kWh data reported for the village of Anaktuvuk Pass in the AEA
report (AEA 2015). For this analysis, the fuel cost per kWh sold metric is compared to the calculated solar
LCOE. Note that the terms “diesel costs”, “diesel electricity costs”, or “diesel fuel costs” are used
interchangeably in this narrative to represent the “fuel costs per kWh sold” metric.
$4.88 $4.96
$4.20
$6.90
$5.94
$6.83
$6.17
$5.92
$4.18
$3.91
$5.10
$6.84
$4.84 $4.77$4.78
$4.61
$5.59 $5.51
$3.95
$4.31$4.36
$4.08
2013 2014
Wainwright
Kasigluk
Ambler
Yakutat
Tenakee SpringsSt. Paul
Adak
Shungnak
Venetie
Anaktuvuk Pass
Hughes
22
Solar Energy Prospecting in Remote Alaska
13
Figure 8. Screenshot and callout of diesel fuel purchases in Anaktuvuk Pass, Alaska
Source: AEA 2015
Input Parameters for Solar Electricity Generation
There are three primary data inputs used to estimate the solar LCOE: (1) the all-in installation costs for a solar
PV system, (2) the ongoing O&M costs for the PV system, and (3) solar resource estimates to determine the
amount of electricity produced at a given location. The input parameters for the solar resource estimates are
described first followed by the solar cost estimates (both installation and O&M).
This analysis uses PVWatts to simulate solar electricity production at a given village under study (NREL
2015). PVWatts utilizes the NREL National Solar Radiation database and combines solar radiation data with
weather data for the years 1991–2010 to estimate a PV system’s electricity production. For this analysis, the
closest available meteorological data was used to determine the electricity production at each of the 11
villages.18 Figure 9 shows a PVWatts screenshot of the village of Adak, which had data available for that
exact location.
18 Five of the eleven villages had weather and solar resource data available in PVWatts. The remaining six villages were based on data
from the nearest available data collection site, which ranged from 24 to 117 miles from the village under analysis.
23
Solar Energy Prospecting in Remote Alaska
14
Figure 9. PVWatts solar resource estimate tool screenshot for Adak, Alaska
Source: NREL 2015
After selecting the exact or nearest location, PVWatts requires a few basic assumptions about the PV system
to estimate the solar electricity production at a given site. These assumptions include system size, module type
(standard or premium), mounting type (roof versus ground mounted), expected losses,19 orientation, and
others. For this analysis, a 100-kW system size was assumed with an open rack-mounting system common for
ground-mounted systems. Figure 10 shows a screenshot of the estimated annual kilowatt-hour production for
a 100-kW PV system in Adak, Alaska (67,949 kWh per year). To estimate the solar production for a 100-kW
system at all 11 villages, the process shown in Figures 8, 9, and 10 was simply repeated for each of the
villages.20
19 Importantly, this analysis assumes a 5% loss factor due to snow accumulation. Snow accumulation has both positive and negative
impact on a PV system’s electricity production. Snow cover on the PV panels themselves dramatically reduces the system’s ability to
generate electricity. However, snow coverage on the ground can actually increase a PV system’s production through enhanced
reflectivity or albedo. This analysis assumes efficient removal of snow from the panels themselves due to the easy access that ground-
mounted systems provide and the steep tilt of PV panels at northern latitudes. More research is required to refine this assumption.
20 Note that in the model used in this analysis, both the installed and O&M costs of the system as well as estimated energy production
scale proportionally with the size of the PV system. Therefore the PV system’s size does not directly impact the LCOE results. To
illustrate, a 50-kW system would cost 50% of a 100-kW system, but correspondingly only produce half of the energy. Thus, a 50-kW,
100-kW, or any other sized system would return the same modeled LCOE. In reality, however, we would expect to see slight
variations in the actual pricing due to economies of scale and other non-scaling cost and production factors.
24
Solar Energy Prospecting in Remote Alaska
15
Figure 10. PVWatts solar resource estimate tool for a 100-kW PV system in Adak, Alaska
Source: NREL 2015
The solar system PV cost estimates used in this analysis are based on approximate multiples of PV pricing
reported in the lower 48. Lawrence Berkeley National Laboratory reports a 100-kW commercial-scale PV
system at a median price point of approximately $3.40/watt (W) in the first half of 2015 (Barbose et al. 2015).
As prices continued to fall in the second half of 2015 and 2016, this analysis assumes a flat $3/W pricing as
the lower 48 base level price, which is then increased to account for higher costs for nearly all goods and
services in remote Alaskan communities. This analysis multiplies the lower 48 base level price by 2, 3, or 4
times to get a range of estimates for remote village pricing. These multiples correspond to $6/W, $9/W, and
$12/W for low-cost, base-case, and high-cost cases respectively. There is some limited evidence of PV
installed pricing at both the low and high end of the range presented in Table 1. For example, Pelunis-Messier
2014 reports PV installed at approximately $5/W, Mathiasson 2015a indicates that ten small sized PV projects
ranged in pricing from nearly $6/W to over $11/W, and Irwin 2013 cites a 2013 installation at nearly $11/W.
Given this wide variation in pricing, this analysis uses a range of possible Alaskan village PV costs rather than
a single point estimate as there is significant uncertainty in both the low and high end of the installed PV price
ranges in the remote village locations.
The O&M costs are treated in a similar fashion. Assuming a lower 48 cost of $20/kW per year for O&M
expenditures, the low-cost, base-case, and high-cost cases for remote Alaskan villages is estimated at
$40/kW/year, $60/kW/year, and $80/kW/year respectively.
25
Solar Energy Prospecting in Remote Alaska
16
Sidebar 3. Cost Trajectories of Diesel Fuel and Solar PV
Figure 11 below illustrates the cost trajectories of wholesale diesel fuel rates compared to the installed price of solar
PV (based on commercial sector pricing from the lower 48) from 2002 through mid-year 2015 (EIA 2016a, Barbose et
al. 2015). This chart indexes diesel fuel and solar PV prices in $/gal and $/W respectively, to a base value of 100 in
2002. Figure 11 highlights the percentage change based on real dollars over time. Several trends are apparent in
Figure 11.
The cost of diesel fuel has been rising steadily since 2002 with two noticeably steep price declines in 2008 and
2014. Diesel fuel prices quickly recovered in 2009, but as of November 2015 remain at their lowest price point since
2003. Even at the low historic pricing levels, the indexed value of diesel fuel costs rose by more than 50% from a
base value of 100 in 2002 to 153 in late 2015. Solar PV pricing has shown a steady cost decline in every year since
2002 from a base index value of 100 in 2002 to 32 in 2015 – a reduction of over 67%.
Given this cost comparison over time, several factors contribute to an improving relative economic case over time for
solar PV. First, solar PV price declines exhibited both predictability and an overall declining cost path. Conversely,
diesel prices have been more volatile and have shown an overall increase from 2002 to 2015. Unpredictability in
diesel fuel costs makes long-term village electricity cost projections difficult to manage. As a repercussion, some
villages have locked in future diesel fuel purchases at a previous year’s pricing and therefore are not paying current
market rates (both on a premium or a discount). Moreover, even while diesel fuel prices are currently lower than any
time since 2003, there are other ramifications of the low commodity price. Perhaps most noteworthy is that Alaska’s
state budget has been drastically reduced from the low price of oil. This means that many state funded programs
could be at risk in the current budget environment, including ones targeted at rural communities such as PCE
(Johnson 2015 and Forgey 2015). Moreover, as described later, several sources are predicting a rise in diesel rates
as soon as mid- year 2016 (EIA 2016b). Solar PV can therefore offer a pricing hedge against the volatile nature of
diesel fuel prices and potential changes to PCE that could impact remote communities.
Figure 11. Indexed diesel and solar PV prices from 2002 to 2015
Source: EIA 2016a and Barbose et al. 2015. Diesel and solar PV pricing data underlying the index values use 2014
real dollars. Note that this comparison does not normalize for energy content. For comparison, a gallon of diesel has
approximately 128,488 British thermal units (Btu) while 1 kWh of electricity has approximately 3,414 Btu (AFDC
2014).
153
32
0
50
100
150
200
250
300
350
400
'02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15
Diesel
Solar PV
26
Solar Energy Prospecting in Remote Alaska
17
Summary of Input Assumptions
Table 1 presents the solar capital and O&M cost estimates for a low-, base-, and high-cost scenario. Figure 12
visually captures the at-times difficult conditions of installing and maintaining all types of equipment,
including PV, in remote Alaska. The occasionally harsh conditions contribute in part to the uncertainty in
costs of installing and maintaining different energy generation technologies in remote communities and thus,
the wide ranges of input parameters used.
Table 1. Cost Estimates for a 100-kW PV System
Village Case
Lower 48
Cost Multiple
Capital Costs
($/W)
O&M Costs
($/kW/yr)
All
Low Cost 2 X $6 $40
Base Case 3 X $9 $60
High Cost 4 X $12 $80
Figure 12. Servicing a PV system in remote Alaska
Source: Bensin 2015
27
Solar Energy Prospecting in Remote Alaska
18
Table 2 shows the annual kilowatt-hour production for a 100-kW system installed across the 11 villages. The
capacity factor is also shown for illustrative purposes.21
Table 2. Annual Solar Energy Estimates
Annual Solar
Energy
Solar
Capacity Factor
Village (kWh) (%)
Adak 67,979 7.8%
Ambler 86,230 9.8%
Anaktuvuk Pass 85,138 9.7%
Hughes 90,456 10.3%
Kasigluk 91,764 10.5%
Shungnak 86,230 9.8%
St. Paul 62,268 7.1%
Tenakee Springs 88,547 10.1%
Venetie 101,824 11.6%
Wainwright 73,881 8.4%
Yakutat 73,934 8.4%
Source: NREL 2015
Table 3 summarizes the wholesale diesel fuel cost data gathered for the 11 villages in this analysis. Because
diesel fuel is a world commodity with constantly changing prices, price data from both 2013 and 2014 are
included in this analysis and represent the range of years in which the comprehensive and consistent data
source is available.22 While the continued drop in oil and diesel fuel rates experienced in 2015 is not captured
in AEA 2014a and AEA 2015, some analytical projections indicate that diesel commodity prices will begin to
rise in mid-2016 (EIA 2016b). Future research could provide an update to the results presented here based the
most current pricing data available for both diesel fuel and installed solar PV prices.
21 Capacity factor is a common metric reported for electrical generation, which is a ratio that compares the amount of actual electric
generation produced in a year divided by its potential generation if it could operate at full capacity for the entire year.
22 Is it is also important to note that while the two metrics of fuel costs, $/gal and $/kWh, track one another fairly well, they are not
perfectly correlated from one year to the next nor village to another. This is because fuel costs in $/kWh calculations are impacted by
other factors such as changing diesel engine efficiency (particularly if a newer, more efficient generator is installed), electrical line
losses, and other factors. It is also likely that simple data reporting inconsistencies from year to year influence how closely fuel costs
in $/gal and $/kWh track one another.
28
Solar Energy Prospecting in Remote Alaska
19
Table 3. Wholesale Diesel Fuel Costs for Electricity Generation 23
2013 Diesel
Fuel Cost
2014 Diesel
Fuel Costs
Village ($/gal) ($/kWh) ($/gal) ($/kWh)
Adak $4.96 $0.57 $4.96 $0.67
Ambler $4.27 $0.33 $6.90 $0.53
Anaktuvuk Pass $6.04 $0.47 $6.83 $0.55
Hughes 24 $6.27 $0.88 $5.92 $0.41
Kasigluk $4.25 $0.47 $3.91 $0.40
Shungnak $5.18 $0.65 $6.84 $0.87
St. Paul $4.92 $0.41 $4.77 $0.36
Tenakee Springs $4.86 $0.43 $4.61 $0.45
Venetie $5.68 $0.64 $5.51 $0.75
Wainwright $4.01 $0.34 $4.31 $0.35
Yakutat $4.43 $0.34 $4.08 $0.31
Source: AEA 2014a, AEA 2015
Finally, the utilization of federal tax benefits such as the 30% investment tax credit and accelerated
depreciation benefit are assumed in this analysis. In the lower 48, nearly all PV projects of the scale
considered here (small commercial at 100 kW) will utilize federal tax incentives for renewable energy as part
of the project’s overall economic value. In the context of Alaska, however, this concept is still relatively
nascent with little precedent, but is gaining attention as state-based dollars for grants (which generally reduce
the inherent value of federal tax credits) are expected to diminish in the coming years following reduced oil
revenue flowing into the state (Johnson 2015). The utilization of for-profit business ownership structures
adapted to Alaska’s unique business climate will likely be a critical market requirement to expanding solar
development in the state.
23 Diesel fuel price inputs shown in 2014 dollars.
24 As mentioned previously, a data reporting error for Hughes in 2013 likely contributes to the high cost shown for 2013 (AEA 2014a).
This data outlier is excluded from the results and conclusion discussion.
29
Solar Energy Prospecting in Remote Alaska
20
Analysis Results
Figure 13 presents the LCOE results for solar PV under the low-cost, base-case, and high-cost scenarios
across the 11 villages analyzed.25 The LCOE under each PV pricing scenario is shown as a different shade of
blue. As an example, for the village of Venetie the low-cost scenario of $6/W results in an LCOE of just
under 40 cents/kWh; the base-case scenario of $9/W results in an LCOE of approximately 60 cents/kWh; and
the high-cost scenario of $12/W results in an LCOE of nearly 80 cents/kWh. Figure 13 also shows the diesel
fuel costs per kilowatt-hour for each of the 11 villages in 2013 and 2014. Several interesting findings emerge
from comparing the range of PV cost estimates ($6/W to $12/W) to the 2013 and 2014 fuel-only diesel
electricity costs.
First, a select number of villages experience diesel electricity generating costs high enough that they are
approaching or nearly on par with the LCOE from even the highest PV cost scenarios. These cases include
Venetie for both 2013 and 2014 and Shungnak based on reported 2014 diesel prices.26 Under these cases,
achieving cost savings from a PV installation appears among the most likely scenarios as PV installation
prices of $9/W or more could be cost competitive with the reported diesel electricity generating costs. PV
pricing falling below $9/W would show a larger economic savings.
Second, several other villages also show cases where diesel prices are still high enough that PV could
potentially compete economically at the low-cost PV price scenario of $6/W. In addition to the high cost
examples mentioned above, these villages include Ambler (2014), Shungnak (2013), Anaktuvak Pass (2014),
Kasigluk (2013), and Adak (2014). In these examples, PV pricing at $6/W could be expected to result in
economic savings when compared to the recent fuel expenditures.
Third, many villages appear to show cases where the PV LCOE could be considered marginally or borderline
cost competitive, even at the assumed $6/W pricing level and diesel prices reported in 2013 and 2014. In these
cases, the solar PV to diesel fuel cost comparison is considered within the level of specificity of these
modeling results, so a more detailed investigation could produce results with favorable solar PV economics.
These situations include Kasigluk (2013), Hughes (2013), Tenakee Springs (2013, 2014), Anaktuvuk Pass
(2013), and Adak (2013). Finally, there are a few cases where the diesel fuel prices in some villages are below
even the lowest estimated PV LCOE, and a solar PV installation does not appear to be economically
competitive at the pricing levels assumed in this analysis. These cases include the villages of Yakutat,
Wainwright, and St. Paul.
Importantly, and what is not captured in Figure 13, is the benefit of price predictability that solar PV can
provide from zero fuel costs. As shown previously in Figure 7 and Sidebar 3, diesel fuel prices have
experienced significant fluctuations from one year to the next and accurate price projections are difficult to
make. Solar PV, by contrast, experiences the vast majority of its costs (with the exception of maintenance
expenses) upfront and therefore offers a predictable energy price for the remainder of the system’s life—often
20 years or more. Additionally, because PV prices have historically been falling rapidly, a $6/W pricing point
that is assumed as a low pricing scenario in the current analysis, could likely be reduced even further in the
near future, particularly if the market for solar PV in Alaska begins to mature and efficiencies develop.
25 The full listing of LCOE results can also be found in Appendix B. Results are shown in cents per kWh rather than the equivalent
$/kWh. Note that all results are presented in 2014 dollars.
26 The high diesel generation cost for the village of Hughes in 2013 appears as an outlier as significant diesel efficiency gains were
reported in 2014 (AEA 2015).
30
Solar Energy Prospecting in Remote Alaska
21
Figure 13. Cost of electricity comparison between solar PV and diesel generation
0
20
40
60
80
100
120
140
Cost of Electricty (cents/kWh)31
Solar Energy Prospecting in Remote Alaska
22
Conclusion
This analysis compares the cost of installing and operating a moderately sized solar PV system to recent diesel
fuel expenditures for electricity generation for several remote villages across Alaska. The high-level results
indicate there are plausible scenarios in which PV can be economically competitive with diesel fuel prices at
low PV penetration levels. In this analysis, the cases where PV appears economically competitive generally
required a combination of (1) high diesel fuel prices (at least 40 cents/kWh), (2) relatively low, for Alaska, PV
prices (approximately $6 to $9 per W installed), (3) relatively high, for Alaska, solar production levels
(capacity factor of nearly 10% or higher), and (4) the ability to make use of economically valuable tax
benefits provided by the federal government. Solar development is likely to be favorable for other Alaskan
villages not considered in this analysis but that have a similar combination of characteristics. However, to
advance this high-level analysis to more precise estimates and eventually a large increase in deployed solar
projects in Alaska, a select number of potential barriers noted previously will require further research or
business ingenuity to address. Some of these barriers include, but are not limited to, the following.
•The integration of solar PV with a diesel generator is an ongoing area of study and demonstration.
The simplifying integration assumptions, including seasonal variability, made in this analysis should
be revised when better information is available.
•Regulatory and business structures such as how to work with the current PCE formula and how to
utilize the valuable federal tax incentives will need to be addressed by the stakeholders involved.
•Further refinements in real-world installation and maintenance costs of large-scale PV systems in
rural Alaska will provide more accurate inputs to the economic modeling.
Despite each of the simplifying assumptions made here, this analysis suggests that solar PV—along with fuel
and other electricity savings measures—can be economically competitive in many remote Alaskan villages
and could have a number of benefits including reducing a village’s dependency on diesel fuel, improving
electricity price predictability, providing local environmental benefits, and more.
32
Solar Energy Prospecting in Remote Alaska
23
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36
Solar Energy Prospecting in Remote Alaska
27
Appendix A. Model Overview and Description
The analysis utilized an NREL-developed cost-of-energy spreadsheet model intended to assist in the
evaluation of the costs of an electricity generation system for a representative remote Alaskan town (model
schematic depicted in Figure 14. The model calculates the cost of energy for three different types of load:
Primary, Deferrable, and Thermal, based on inputs defining project installation (size, capital costs, etc.),
financing, and operational costs and the ratios of each generation price and load type. Users can choose to run
the model in one of three calculation modes: Target Internal Rate of Return, Target Payback Period, or Target
Energy Cost, holding that variable constant and returning values for the other two variables along with debt
metrics, fuel savings, and other costs.
For this analysis, all revenue was assumed to be generated from the AC Primary Load, thus the inputs for the
Deferrable Load and Thermal Load were set to zero. In addition to the inputs shown in Table 1 and Table 2,
this analysis also assumed that the project was financed with 100% equity, generated an 8% Internal Rate of
Return, and that both the LCOE and annual O&M expenditures increased by 1.5% annually.
Figure 14. Schematic of LCOE model used in this analysis
37
Solar Energy Prospecting in Remote Alaska
28
Appendix B. Levelized Cost of Energy Results
Table 4 shows the solar PV LCOE for each of the 11 villages under analysis for the low-cost, base-case, and
high -cost scenarios.
Table 4. Solar PV LCOE Modeling Results
Low-Cost Base-Case High-Cost
Village (¢/kWh) (¢/kWh) (¢/kWh)
Venetie $39.91 $59.44 $78.96
Kasigluk $44.29 $65.95 $87.62
Hughes $44.93 $66.91 $88.89
Tenakee Springs $45.90 $68.35 $90.80
Ambler $47.13 $70.19 $93.24
Shungnak $47.13 $70.19 $93.24
Anaktuvuk Pass $47.74 $71.09 $94.44
Yakutat $54.97 $81.86 $108.75
Wainwright $55.01 $81.92 $108.83
Adak $59.79 $89.03 $118.28
St. Paul $65.27 $97.20 $129.12
38
NORTHWEST ARCTIC
REGIONAL ENERGY PLAN
2022
Prepared for: The Northwest Arctic Borough & NANA Regional Corporation
April 11, 2022
Northwest Arctic Regional Energy Plan 1
Northwest Arctic Regional Energy Plan Communities
Serving the communities of:
English Name Iñupiaq Name
Ambler Ivisaappaat
Buckland Nunachiaq
Deering Ipnatchiaq
Kiana Katyaak
Kivalina Kivalieiq
Kobuk Laugviik
Kotzebue Qikiqtabruk
Noatak Nautaaq
Noorvik Nuurvik
Selawik Akulibaq
Shungnak Issingnak
Plan Prepared by:
DeerStone Consulting, LLC
Prepared For and in Coordination With:
Northwest Arctic Borough and NANA Regional Corporation
Northwest Arctic Regional Energy Plan 2
Regional Map & Plan Coverage Area
Figure 1. Energy Infrastructure in the Northwest Arctic
Northwest Arctic Regional Energy Plan 3
Acknowledgements
DeerStone Consulting developed this Northwest Artic Regional Energy Plan in coordination with the
Northwest Arctic Borough, NANA Regional Corporation, and with the participation of many community
energy stakeholders and individuals. We wish to thank everyone for their input and commitment to a
resilient, sustainable, and affordable energy future.
Stakeholder Participants Include:
Ingemar Mathiasson, Energy Manager, Northwest Arctic Borough
Sonny Adams, Director of Energy, NANA Regional Corporation
Albie Dallemolle, Sr. Director of Village Economic Investment, NANA Regional Corporation
Terrell Jones, Energy Coordinator, NANA Regional Corporation
Ambler: Scott Jones
Buckland: Patricia Thomas, David Lee, Tim Gavin, Mike Sheldon (Power Plant Operator)
Deering: Daisy Weinard, Chris Moto (Power Plant Operator)
Kiana: Dolores Barr, Brad Reich, Eli Cyrus
Kivalina: Millie Hawley, Becky Norton, Austin Swan
Kobuk: Edward Gooden
Kotzebue Electric Association: Matt Bergen
Noatak: Jennifer Sage
Noorvik: Glen Skin
Selawik: Tanya Ballot, Mildred Greist
Shungnak: Billy Lee
Alaska Village Electric Cooperative: Bill Stamm, Dan Allis, Darren Westby, Forest Button
Northwest Arctic Regional Energy Plan 4
Acronyms and Abbreviations
AEA Alaska Energy Authority
ACEP Alaska Center for Energy and Power
AHFC Alaska Housing Finance Corporation
ANCSA Alaska Native Claims Settlement Act
ANTHC Alaska Native Tribal Health Consortium
AVEC Alaska Village Electric Cooperative
BIA Bureau of Indian Affairs
BEES Building Energy Efficiency Standard
BESS Building Energy Storage System
CFL Compact Fluorescent Light
DCCED Department of Commerce, Community and Economic Development
DOE U.S. Department of Energy
DOL Alaska Department of Labor (and Workforce Development)
ECI Energy Cost Index
EPA U.S. Environmental Protection Agency
HUD U.S. Department of Housing and Urban Development
ICDBG Indian Community Development Block Grant
IPP Independent Power Producer
KEA Kotzebue Electric Association
kW Kilowatt
kWh Kilowatt-hour
MWh Megawatt-hour
NAB Northwest Arctic Borough
NANA or NRC NANA Regional Corporation
NDC NANA Development Corporation
NREL National Renewable Energy Laboratory
NWABSD Northwest Arctic Borough School District
NWALT Northwest Arctic Leadership Team
PCE Power Cost Equalization
PV Photovoltaic
REAP Renewable Energy Alaska Program
REF Renewable Energy Fund
WTP Water Treatment Plant
Northwest Arctic Regional Energy Plan 5
Table of Contents
NORTHWEST ARCTIC REGIONAL ENERGY PLAN COMMUNITIES ......................................................................................... 1
REGIONAL MAP & PLAN COVERAGE AREA ........................................................................................................................ 2
ACKNOWLEDGEMENTS .................................................................................................................................................... 3
ACRONYMS AND ABBREVIATIONS ................................................................................................................................... 4
TABLE OF FIGURES ........................................................................................................................................................... 6
TABLE OF TABLES ............................................................................................................................................................. 6
EXECUTIVE SUMMARY ..................................................................................................................................................... 7
INTRODUCTION ............................................................................................................................................................... 8
REGIONAL ENERGY VISION ........................................................................................................................................................... 10
REGIONAL ENERGY GOALS ........................................................................................................................................................... 11
ENERGY PRODUCTION AND CONSUMPTION .................................................................................................................. 11
COMMUNITY ENERGY - FOCAL POINTS ........................................................................................................................... 14
RESIDENTIAL HEATING ................................................................................................................................................................ 14
HOUSING ................................................................................................................................................................................. 18
BULK FUEL ................................................................................................................................................................................ 20
ELECTRICITY .............................................................................................................................................................................. 22
RENEWABLE ENERGY AND BATTERY STORAGE MICROGRID CASE STUDIES ............................................................................................. 27
Deering ............................................................................................................................................................................. 27
Buckland ........................................................................................................................................................................... 29
Shungnak & Kobuk ........................................................................................................................................................... 30
Kotzebue ........................................................................................................................................................................... 33
TECHNOLOGY PRICING & TRENDS .................................................................................................................................. 35
REGIONAL ENERGY OPPORTUNITIES .............................................................................................................................. 38
PROJECTS AND OPPORTUNITIES MATRIX ....................................................................................................................... 44
COMMUNITY ENERGY PROFILES .................................................................................................................................... 44
CONCLUSIONS ............................................................................................................................................................... 44
APPENDICES .................................................................................................................................................................. 46
Northwest Arctic Regional Energy Plan 6
Table of Figures
FIGURE 1. ENERGY INFRASTRUCTURE IN THE NORTHWEST ARCTIC .............................................................................................................. 2
FIGURE 2. SOLAR INSTALLATION CREW IN KOTZEBUE (PHOTO COURTESY OF MATT BERGAN) .......................................................................... 8
FIGURE 3. REGIONAL ENERGY PLANNING MEETING IN NOATAK ............................................................................................................... 10
FIGURE 4. DIESEL FUEL % BY USAGE .................................................................................................................................................. 11
FIGURE 5. FUEL USAGE FOR POWER AND HEAT, IN GALLONS ................................................................................................................... 12
FIGURE 6. FUEL USAGE BY COMMUNITY, % ......................................................................................................................................... 12
FIGURE 7. REPORTED HOME HEATING ISSUES (AUG 2021 - JAN 2022) ................................................................................................... 15
FIGURE 8. REPORTED GOING WITHOUT HEAT (AUG 2021 - JAN 2022) ................................................................................................... 15
FIGURE 9. A CLEAR COLD WINTER DAY IN THE NORTHWEST ARCTIC (PHOTO CREDIT: CHRIS AREND, NANA) .................................................. 17
FIGURE 10. SOLAR PV AND WIND IN KOTZEBUE (PHOTO COURTESY OF MATT BERGAN) .............................................................................. 17
FIGURE 11. AVERAGE HOME ENERGY COSTS VS ENERGY CONSUMPTION, FROM THE 2018 AHFC HOUSING REPORT FOR THE NANA REGION ...... 19
FIGURE 12. BRAIDED RIVER ILLUSTRATES THE HYDROLOGY CHALLENGES OF FUEL DELIVERY .......................................................................... 21
FIGURE 13. AGING FUEL TANKS IN THE REGION .................................................................................................................................... 21
FIGURE 14. UTILITY COSTS TO GENERATE POWER (PER $/KWH) ............................................................................................................. 22
FIGURE 15. FUEL EFFICIENCY (KWH/GAL) ........................................................................................................................................... 23
FIGURE 16. LINE LOSS % .................................................................................................................................................................. 24
FIGURE 17. ANNUAL ENERGY SOLD (KWH), BROKEN DOWN BY CUSTOMER TYPE (NOT INCLUDING KOTZEBUE) ............................................... 25
FIGURE 18. DEERING RENEWABLE COMPONENT SIZES RELATIVE TO AVERAGE COMMUNITY DEMAND ............................................................ 27
FIGURE 19. DEERING PERCENT RENEWABLE GENERATION BY MONTH ...................................................................................................... 28
FIGURE 20. BUCKLAND RENEWABLE COMPONENT SIZES RELATIVE TO AVERAGE COMMUNITY DEMAND.......................................................... 29
FIGURE 21. BUCKLAND PERCENT RENEWABLE GENERATION BY MONTH .................................................................................................... 30
FIGURE 22. SHUNGNAK/KOBUK RENEWABLE COMPONENT SIZES RELATIVE TO AVERAGE COMMUNITY DEMAND .............................................. 31
FIGURE 23. SHUNGNAK SOLAR PRODUCTION OVER A TWO-WEEK PERIOD IN MARCH 2022 ........................................................................ 32
FIGURE 24. DETAILED DATA FOR SOLAR, DIESEL, BATTERY OVER A SINGLE DAY ......................................................................................... 32
FIGURE 25. SHUNGNAK SOLAR ARRAY (PHOTO COURTESY OF INGEMAR MATHIASSON, NAB) ...................................................................... 33
FIGURE 26. KOTZEBUE RENEWABLE COMPONENT SIZES RELATIVE TO AVERAGE COMMUNITY DEMAND .......................................................... 33
FIGURE 27. KEA SOLAR PV PRODUCTION IN 2021 AND OVER PROJECT LIFETIME ....................................................................................... 34
FIGURE 28. BUCKLAND SOLAR ARRAY ................................................................................................................................................. 35
FIGURE 29. SHUNGNAK BATTERY BUILDING (PHOTO COURETSY OF INGEMAR MATHIASSON) ........................................................................ 36
FIGURE 30. BATTERIES FOR SHUNGNAK, PRIOR TO INSTALLATION (PHOTO COURTESY OF INGEMAR MATHIASSON)............................................ 36
Table of Tables
TABLE 1. HEATING FUEL COSTS ......................................................................................................................................................... 13
TABLE 2. POWER GENERATION COSTS ................................................................................................................................................ 13
TABLE 3. HEATING FUEL COSTS BY COMMUNITY, HIGHS AND LOWS ......................................................................................................... 14
TABLE 4. PCE SUBSIDY SUMMARY BY COMMUNITY, 2019 ..................................................................................................................... 26
Northwest Arctic Regional Energy Plan 7
Executive Summary
This document builds upon the previous regional energy planning efforts that have been previously
completed in the Northwest Arctic, the most recent of which was published in 2016. To keep the plan
current, the Northwest Arctic Borough and NANA Regional Corporation invested in a 2022 update.
This regional energy plan is a product of the Northwest Arctic Borough’s and NANA Regional
Corporation’s commitment to a clean, affordable, and reliable energy future for the residents of the
Northwest Arctic and NANA shareholders. The regional planning process began in earnest in 2008 when
global oil prices spiked, causing large increases in stove oil, diesel fuel, and electricity prices throughout
the region and elsewhere. A regional energy summit was convened in Kotzebue, which ultimately led to
the creation of the Northwest Arctic Energy Steering Committee, diesel fuel reduction goals, and a
continual focus on increasing regional energy security through use of clean, local energy sources.
The 2022 revision represents the continuing process of documenting the current status of energy
opportunities, needs, and recommendations for reducing energy costs while maintaining or improving
the current level of service.
The planning process consisted of the following activities:
DeerStone worked in coordination with the Borough and NANA to collect background data including past
energy plans, relevant documents, studies, and tabulated data and then conducted a desktop review of
the background information. The background review helped to inform the interviews with community
leaders and key energy stakeholders. DeerStone interviewed City and Tribal leaders, electric utility
stakeholders, fuel distributors, and other community and regional stakeholders to understand the
current energy landscape, needs, and opportunities; in addition, the team sought an understanding of
how each community wanted to prioritize energy projects and opportunities. Draft energy profiles and
project and opportunities for each community were presented to stakeholders for feedback and
revisions. The energy planning process resulted in the Northwest Arctic Regional Energy Plan,
Community Energy Profiles for each community in the region and a comprehensive Project and
Opportunities Matrix to cover the entire region.
Data
Collection &
Review
Stakeholder
Engagement
Community
Energy
Profiles
Project &
Opportunities
Matrix
Feedback &
Revisions Final Report
Northwest Arctic Regional Energy Plan 8
Introduction
Alaska’s Northwest Arctic communities have energy prices that are much higher than the national
average and are amongst the highest in Alaska. The region’s energy leadership and innovation have been
partly in response to these high prices and challenges to energy security and are clearly demonstrated
by the numerous studies, analyses, training events, experimental technologies, pilot projects, and
widespread deployment of renewable energy and energy efficiency projects in all 11 communities in the
Northwest Arctic. All of these initiatives have required time, effort, and funding. NANA Regional
Corporation (NRC) and the Northwest Arctic Borough (NAB) have committed their own staff and financial
resources to lead this effort, along with contributions from individual communities and organizational
stakeholders for specific projects.
State and federal government support has also played an important role in the region’s energy
development success, including grant awards and technical assistance from agencies such as the US
Department of Energy (DOE), the US Department of Agriculture (USDA), the Environmental Protection
Agency (EPA), the US Department of Interior’s Bureau of Indian Affairs (BIA), the Denali Commission,
Alaska Energy Authority (AEA), and others.
Each and every community in the region has also contributed time, money, and a great deal of effort to
advance their energy goals and share information with other stakeholders. This has created a regional
dynamic establishing a high level of awareness and support for continued clean energy development and
capacity building at the local level. This regional plan is another example of this dynamic and group effort.
Figure 2. Solar Installation Crew in Kotzebue (Photo Courtesy of Matt Bergan)
Northwest Arctic Regional Energy Plan 9
Many of the specific projects that have been deployed across the region have been captured in this
report, especially in the Community Energy Profiles section, which provides a brief snapshot of individual
projects, their cost, funding source(s), and current status. Past projects and lessons learned have
informed future projects and opportunities as we plan for what comes next for the region. For example,
designing and constructing large solar PV and/or wind and battery storage projects to enable several
hundred hours annually of diesels-off operation are now commonplace across the region, however each
deployment has built on the previous ones to reduce costs and improve performance. Based on such
iterative improvements, the region was also evaluated to identify potential opportunities to bundle
projects across communities to streamline efforts, reduce costs, and achieve economies of scale where
possible. This effort is captured below in the Project and Opportunities Matrix that is part of this plan
and has become an organizing strategy for accelerating development of multiple projects across the
region.
It should also be noted that during the process of researching and drafting this document, global energy
dynamics drastically changed in large part as a result of the Russian invasion of Ukraine in February and
March of 2022, which caused oil prices to spike during the same time that most communities were
purchasing a year’s worth of fuel in preparation for summer delivery. The new price realities, such as
$16/gallon for diesel fuel delivered by air to Noatak in early March 2022, are not fully factored into the
economic evaluations included here since all of the detailed analysis for this plan was complete prior to
this sharp uptick in energy prices. In general, all of the renewable energy efforts evaluated here will
demonstrate better economic performance as a result of recent fossil fuel price spikes, but it is unknown
how long such prices will last, and this is little consolation to residents paying high prices for the energy
needs still met with fossil fuel.
This regional planning document consists of an overview of energy production and consumption in the
region followed by a more detailed discussion on residential heating, housing, bulk fuel, and electricity.
The plan then provides technology pricing and trends that have emerged in the region as a result of
lessons learned from each past project and the institutional memory that has evolved from effective
communication among project partners. Details of individual systems and a more generalized project
development process that has been used across the region is presented. The core of the plan—energy
opportunities for the region and for each community—are then described in various formats in the main
narrative and as Appendices.
Northwest Arctic Regional Energy Plan 10
Regional Energy Vision
The vision for the Northwest Arctic region is to be at least 50% reliant on regionally sourced energy for
heating and power generation by the year 2050. Milestones toward this long-term vision include:
• 10% decrease of imported fuel by 2020 - accomplished
• 25% decrease of imported fuel by 2030
• 50% decrease of imported fuels by 2050
This vision was established at the first regional energy summit in Kotzebue in 2008 in response to the
energy crisis at the time, which resulted in a rapid and sharp increase in fuel prices similar to the recent
price escalation in February and March 2022. These values were considered (and remain) ambitious and
visionary especially because reliable renewable energy in remote locations was still in early development
in 2008 and exceedingly expensive. Currently, there are some examples of institutions and communities
aiming for as high as 100% renewables by a certain time in the future. Considering the energy challenges
in Northwest Arctic and all of rural Alaska, such a goal appears overly ambitious at the present time, but
as global awareness and support for clean energy grows, there are increasingly sophisticated strategies
and tools to measure progress as a community or region reduces its dependence on fossil fuels and
increases its use of local renewable energy. Some of these tools and strategies will be discussed more
Figure 3. Regional Energy Planning Meeting in Noatak
Northwest Arctic Regional Energy Plan 11
below. As technology options continue to mature and drop in price, the region may want to re-visit their
vision and more comprehensively measure their progress in the future against a baseline of fuel
consumption identified in this and/or other reports.
Regional Energy Goals
The energy goals for the region are informed across regional and community stakeholders and include:
Lower costs of energy for heating, electricity, and transportation.
Development of reliable and local and/or regional energy sources.
Achievement of independence from imported fuel as much as possible.
Regional collaboration and unification of energy related operations.
Local economic development as a part of the energy solutions employed.
Reduce the region’s carbon footprint.
Land stewardship and protection of subsistence resources to be considered during all project
development and execution.
Energy Production and Consumption
The primary uses of energy in the region are for power
generation, heat, and transportation. All of these uses are
mostly provided by diesel fuel and some gasoline for light
duty transportation vehicles. Renewable energy is
meeting a small but growing share of these uses.
Understanding the amounts of diesel fuel used in the
region is critical to quantifying the opportunities for
reducing the usage of diesel fuel or replacing it with a less
costly alternative. Figure 4 shows the percentage of diesel
fuel consumption by the three primary uses: power
generation (46%), heat (44%), and transportation (10%).
Data is readily available for diesel fuel used for power
production in rural Alaska because electric utilities must
file monthly reports on their diesel fuel usage to receive state PCE subsidies.
Accurate fuel use data for heating is often difficult to collect because it is not measured when it is
consumed, and fuel providers do not publicly share their delivery data. Hence, heating fuel usage was
estimated using data collected informally by the Northwest Arctic Borough’s Energy Coordinator and
from end use surveys across the state that concludes a “typical” rural Alaska village energy distribution
Transportation
10%
Power
Generation
46%
Heat
44%
Diesel Fuel % by Usage
Figure 4. Diesel Fuel % by Usage
Northwest Arctic Regional Energy Plan 12
is anywhere from 1.5 times to twice as much fuel consumed for heating as compared to electricity. Using
this methodology, we estimate that diesel fuel for heat for the entire region ranges between 3.5 – 4.5
million gallons.
Figure 5 represents the region’s combined usage of 2,342,692 gallons of diesel fuel in 2019 for producing
electricity and the 3,500,208 gallons of diesel fuel used for heat. Figure 6 illustrates the breakdown of
total energy usage by community. Not surprisingly, Kotzebue consumes 58% of the fuel used in the
region since over half the population of the entire region lives in Kotzebue.
These estimates are particularly useful to construct a baseline of energy consumption, and ultimately
energy expenditures, in the region. With fuel prices provided by various sources, we can begin to
determine total dollar amounts spent on fuel for heating and electricity.
The total amount spent on fuel for both heating and power production needs for the region is $30.7
million annually. The 2.3 million gallons of fuel required for the region to generate power costs $7.5
million annually based on 2020 PCE data including average price per gallon of fuel for each power utility.
The estimated 3.5 million gallons of stove oil used for heating needs for the region costs $23.2 million
annually based on spring 2020 retail stove oil prices by community. While the fuel costs account for most
of the power generation expenditures, additional non-fuel costs—including utility labor, operation,
maintenance, and administrative expenses—are paid by consumers. These additional non-fuel costs
2,342,692
3,500,208
-
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
Total
Regional Fuel Usage (Gal)
Power Generation Heat
Figure 5. Fuel Usage for Power and Heat, in gallons
Ambler
3%Buckland
5%
Deering
2%
Kiana
5%
Kivalina
4%Kobuk
1%
Noatak
5%
Noorvik
6%
Selawik
7%
Shungnak
4%
Kotzebue
58%
Percentage of Fuel Usage By
Community
Figure 6. Fuel Usage by Community, %
Northwest Arctic Regional Energy Plan 13
amount to approximately $6.6 million annually. For heating and power costs combined, including non-
fuel costs for electricity generation, this equates to $37.3 million annually for the region.
Table 1. Heating Fuel Costs 1
Ambler Buckland Deering Kiana Kivalina Noatak
Heating Fuel Costs $687,158 $997,679 $353,732 $1,008,991 $525,557 $1,442,226
Noorvik Selawik Shungnak Kotzebue Kobuk Region-Total
Heating Fuel Costs $1,072,333 $1,789,245 $1,179,921 $13,756,838 $399,439 $23,213,119
Table 2. Power Generation Costs 2
Ambler Buckland Deering Kiana Kivalina Noatak
Gallons of Fuel 98,354 125,304 46,022 117,719 124,131 129,989
Fuel Costs $405,319 $423,644 $140,244 $402,541 $410,984 $932,436
Non-Fuel Costs $345,369 $43,494 $250,759 $334,447 $356,748 $355,099
Total Costs $750,688 $467,138 $391,003 $736,988 $767,732 $1,287,535
Noorvik Selawik Shungnak Kotzebue Kobuk Region-Total
Gallons of Fuel 143,743 201,864 127,094 1,227,703 - 2,341,923
Fuel Costs $493,916 $676,356 $594,780 $3,031,142 $0 $7,511,362
Non-Fuel Costs $399,843 $553,422 $196,355 $3,611,073 $136,973 $6,583,582
Total Costs $893,759 $1,229,778 $791,135 $6,642,215 $136,973 $14,094,944
The data above shows that of the combined fuel for power and heat, an estimated 40% is used for power
generation, and accounts for only 23.9% of the combined fuel costs due to the lower cost of fuel for the
electric utilities. Alternatively, almost 76% of all money spent on fuel in the region goes toward heating
fuel.
As the region continues to make strides in reducing the cost to generate power through energy efficiency
upgrades and renewable energy integration, it is important to recognize that the cost of heating fuel is
a dominant component in the overall cost of energy and any efforts that reduce the cost of heating fuel
will have an outsized impact in reducing the cost of energy for residents, households, and businesses in
the Northwest Arctic/NANA region.
1 Based on 2019 Heating Oil Prices, Provided by the Borough
2 Based on 2020 PCE Data
Northwest Arctic Regional Energy Plan 14
Community Energy - Focal Points
Residential Heating
Nearly half of the residents in the region use a combination of heat sources including furnaces, wood
stoves, Toyo or Monitor stoves, and boilers. Heating in the region consumes an estimated 3.5 million
gallons, or more, of heating fuel 3 annually. Much of this fuel is used for residential heating and is
purchased at retail prices as compared to some larger community buildings such as local schools that
purchase heating fuel at much lower prices. An estimated 124,000 gallons of heating oil is displaced
through the burning of local wood for heat 4.
Due to high retail heating fuel prices and cold winter temperatures, the financial burden of home heating
in the region is immense. Table 3 shows the average annual price of heating fuel across the region. Table
3, enumerates the retail heating fuel prices for each community for each of the last six years. The prices
in red indicate the highest stove oil price in each community over the last six years, and those in green,
the lowest. As mentioned elsewhere, note that the 2022 extreme price escalations are not shown in this
table.
Table 3. Heating Fuel Costs by Community, Highs and Lows
2016 2017 2018 2019 2020 2021
Kotzebue $5.26 $5.26 $5.97 $5.97 $5.92 $5.87
Ambler $9.50 $8.50 $9.75 $9.53 $10.30 $10.30
Kobuk $7.50 $8.24 $9.75 $9.27 $9.27 $9.27
Shungnak $8.42 $8.42 $8.42 $8.50 $8.50 $8.50
Kiana $5.67 $5.67 $5.67 $5.67 $5.15 $5.67
Noorvik $5.42 $5.64 $5.64 $5.64 $5.64 $5.00
Selawik $8.25 $7.99 $7.99 $6.36 $6.36 $6.36
Noatak $8.99 $10.29 $10.29 $10.29 $9.26 $9.26
Kivalina $4.49 $4.49 $4.49 $4.53 $4.12 $4.20
Deering $4.89 $4.38 $4.90 $3.35 $4.12 $4.12
Buckland $6.89 $6.89 $6.89 $6.04 $6.15 $6.15
NANA hired McKinley Research Group in January 2022 to conduct a survey on home heating of NANA
shareholders and Borough residents to better understand and begin to quantify the depth of the home
heating crisis in the region. This survey occurred at the end of a cold winter and just before the region
began to see dramatic increases in fuel prices due to the Russia-Ukraine conflict. The retail price of
heating fuel in Noatak in March of 2022 was reportedly $15.99 per gallon. These inflated fuel prices are
3 Also known as “stove oil.”
4 2016 Northwest Arctic Energy Plan
Northwest Arctic Regional Energy Plan 15
not captured here for all communities as most had not yet purchased fuel for the upcoming year when
this report was published.
The home heating survey found that within the interval from August 2021 to January 2022, 37% of
regional households reported going without heat at some point and 70% of regional households
reported having some type of home heating issues.5 Home heating issues included non-functional
furnaces, inability to afford heating oil or electricity, or inability to gather firewood, among other
challenges. Figure 7 and Figure 8 describe the prevalence of home heating challenges and disruptions
experienced between August 2021 and January 2022.
Responses to the home heating survey also indicated that only 38% of households that completed the
survey had received heating or energy-related financial assistance in 2020 or 2021, while 65% of survey
respondents reported experiencing challenges accessing heating or energy assistance. The challenges
sited included lack of internet, knowledge of programs, access to applications, or technical assistance. It
is likely that many of the households that did receive assistance received it from a federal subsidy known
as the Low Income Home Energy Assistance Program (LIHEAP) that covers some fuel costs for heating
residences. This transfer payment is determined individually for each household based on a complicated
formula that includes not just income level, but size of household and the type of housing structure lived
in. The result is highly variable and difficult to predict payments that can occur once each annual heating
season and are not uniformly available across a community because of the eligibility criteria.
Despite these drawbacks, the LIHEAP payment helps reduce home heating costs of some NANA
shareholders and residents in the region, often by as much as $1,000 or more annually. It is clear from
5 Home Heating Survey – NANA Regional Corporation. McKinley Research Group. March, 2022.
51%48%43%43%42%41%40%37%34%34%
19%
37%
Reported Going Without Heat
Figure 8. Reported Going Without Heat (Aug 2021 - Jan 2022)
43%40%43%
51%
42%41%
34%37%
48%
19%
34%37%
Reported Home Heating Issues
Figure 7. Reported Home Heating Issues (Aug 2021 - Jan 2022)
Northwest Arctic Regional Energy Plan 16
the survey results that there is an opportunity to expand the impact of this program in the region through
additional awareness of this program and assistance with applications.
This subsidy is continually targeted for reduction or elimination at the federal level, which would
disproportionally impact NANA shareholders and NAB residents and make heating of homes even less
affordable. Supporting preservation of LIHEAP at the federal level through public outreach and education
could prevent an increase in energy costs for the region. NANA already has an education, outreach, and
lobbying arm in Washington, DC, and this issue could easily fold into the existing efforts to educate
lawmakers on this important subject.
Although the home heating challenges experienced during the 2021-2022 winter were particularly acute,
home heating is not a new challenge and targeted ongoing efforts will be required to reduce the financial
burden and improve the comfort level of households throughout the region. Numerous studies have
shown energy efficiency and weatherization to be the least costly and most immediate energy saving
opportunity. Retail prices for diesel heating fuel are very high, so reducing heating demand has
significant financial benefits for individual homes and businesses.
Starting with a total heating fuel use of 3.5 million gallons across the region, achieving a 15% uniform
improvement in building performance from weatherization would result in 525,000 gallons of fuel saved
annually. Though different entities pay different retail rates for heating fuel (and electricity), at a very
basic level, if this 15% heating fuel savings were distributed evenly across all buildings and market
participants, this would amount to a region-wide cost savings of approximately $3,450,000. Achieving
such fuel savings through weatherization and energy efficiency would also have costs and require
different approaches for different buildings. However, this represents significant economic impact
roughly equivalent to the total amount of Power Cost Equalization (PCE) subsidy provided by the state
to the communities and electric utilities operating in the region. (The PCE Program is discussed in more
detail below.) Any fuel use reduction from weatherization and energy efficiency also represents other
benefits beyond cost savings, such as reduced chance of fuel spills, carbon reduction, and a buffer from
future cost increases. Implementing energy efficiency and weatherization programs has historically been
led by the state’s Alaska Energy Authority (AEA) and Alaska Housing Finance Corporation (AHFC), but
with reduced state resources, this may be better facilitated at the regional level with a coordinated effort
among regional stakeholders and continued outreach and collaboration with AEA and AHFC.
Northwest Arctic Regional Energy Plan 17
In the long-term, the region must take a
multifaceted approach to reduce the cost of home
heating and the reliance on price-unstable heating
fuel. This effort should include addressing bulk fuel
storage limitations in each community and working
to develop a regional fuel purchasing strategy to
ideally consolidate the fuel needs of each
community into a unified high-volume fuel
purchase, thus lowering the cost for all. Additionally,
the long-term strategy should include investments
in renewable energy and battery storage
technologies that reduce the cost to generate electricity and therefore broaden the opportunity for the
use of electric heating devices such as heat pumps and dispatchable ceramic heaters that can take
advantage of excess wind energy.
Most renewable energy systems are site and community specific and much of the technology is still in
the rapid development and cost reduction phase. Project development costs are often higher than
existing diesel systems, but some technology, such as solar photovoltaic (PV), is beginning to reach a
commodity stage. First-of-a-kind solar-wind-battery-diesel hybrid systems have been installed in Deering
and Buckland and are showing promise for reducing the dependence on diesel fuel for power generation.
These systems have successfully demonstrated powering a village microgrid with 100% renewable
energy (diesels-off) for significant periods of time. From April through September 2020, for example,
Deering powered its community exclusively from renewable energy and batteries, with no diesel inputs,
for 21% of the time.
Figure 9. A Clear Cold Winter Day in the Northwest Arctic (Photo
Credit: Chris Arend, NANA)
Figure 10. Solar PV and Wind in Kotzebue (Photo Courtesy of Matt Bergan)
Northwest Arctic Regional Energy Plan 18
In Kotzebue, the large-scale wind and solar systems, combined with batteries and diesel generators, are
saving over 250,000 gallons of diesel fuel annually that was previously used for electricity generation
and thousands of gallons of heating fuel no longer needed at the Maniilaq hospital.
Renewable energy also shows promise to support economic development in the more remote areas of
the region. A proposed hydroelectric project could potentially be a more cost-effective solution for
providing power to a proposed remote mine in the Upper Kobuk than diesel generators. As renewable
energy technology continues to drop in price and improve in reliability, alternatives to diesel generation
in remote locations is becoming more cost effective.
The regional home heating crisis is a symptom of the intersection of many other challenges: the cost of
heating fuel, the cost to generate electricity, aging homes and heating infrastructure, limited job
opportunities, and others. The complexity of this issue will require an equally interconnected and
intensive set of solutions.
Housing
The region’s housing related data from the 2018 AHFC Housing Assessment 6 for the NANA Region paints
a picture of the overcrowded housing, a high cost of energy for housing relative to the size and energy
consumption, and health concerns related to indoor air quality issues.
Based on that 2018 Assessment, there are 2,864 housing units in the NANA region. Of these, 2,002 are
occupied and 788 are being used seasonally or are otherwise vacant. The average footprint of a single-
family home in the region is 925 square feet, which is smaller than the statewide average of 1,995 square
feet. Of the occupied units, 39% are estimated to be either overcrowded (18%) or severely overcrowded
(21%). This is nearly 12 times the national average and the second most overcrowded in the state.
The Northwest Arctic region has the highest estimated average annual home energy costs in the state,
which is a significant cost burden on residents. The region has a high participation rate in the
Weatherization Assistance Program, with around 32% of occupied housing units having been
weatherized. Approximately 47% of homes in the region were built before 1980, have not received
energy efficiency retrofits and are in need of weatherization and efficiency retrofits. These homes exceed
seven air changes per hour at 50 Pascals (ACH50). Of that 47%, 11% are using at least four times the
energy of a new home built with modern standards and would be the best candidates for immediate
retrofits.
6 The 2018 AHFC Housing Assessment can be accessed at: https://www.ahfc.us/pros/energy/alaska-housing-
assessment/2018-housing-assessment
Northwest Arctic Regional Energy Plan 19
A tight home with no or inadequate ventilation has an increased risk of issues with indoor air quality,
moisture, and related mold issues. Approximately 41% of homes in the region are considered to be at
risk for indoor air quality issues due to lack of continuous ventilation.
Roughly 224 homes, or 11%, of the occupied homes in the region are estimated to be 1-star homes.
These homes use four times the energy than if they were built to AHFC’s Building Energy Efficiency
Standard (BEES).
The energy cost index (ECI), or annual
energy cost per square foot, for a single-
family home in the region averaged
$6.75 in 2018, which at the time was the
highest in the State of Alaska. This is
nearly three times the statewide
average of $2.31 per square foot and is
about seven times the national average
of $0.95 per square foot. Figure 11
illustrates that the single-family home in
the region, while small and using less
energy than an average home in the
State of Alaska, has an exorbitantly higher cost of energy.
The region has a clear need for more housing to address the current issues of overcrowding; ideally
future housing would be energy efficient and have adequate ventilation. The region’s existing housing
stock is highly variable in terms of quality, construction techniques, size, age, heating appliances, and
related energy burden. However, improving the building envelope, reducing air infiltration, adding
insulation with appropriate ventilation to avoid mold, and properly maintaining boilers and furnaces can
save significant amounts of fuel and money.
In rural Alaska, it has been demonstrated that the most effective programs for realizing home and
building energy efficiency are organized, whole village efforts such as mobilizing a housing crew to
perform weatherization tasks including caulking, roofing insulation, and repairing water heaters, boilers
and stoves for residential and commercial facilities across a community. High value energy efficiency
measures typically include installing items like new LED lights, set back thermostats, high efficiency
refrigerators and freezers, and on-demand water heaters. Results have varied widely due to things like
the quality of the original building stock and status of the equipment being replaced, but across the state,
past weatherization and energy efficiency programs have demonstrated in excess of 30% improvement
Figure 11. Average Home Energy Costs vs Energy Consumption, from the 2018 AHFC
Housing Report for the NANA Region
Northwest Arctic Regional Energy Plan 20
in energy savings. It would certainly be safe to assume a typical rural Alaska home such as those found
in the Northwest Arctic could easily and cost effectively improve its energy performance by 15% annually
with basic weatherization and energy efficiency efforts.
The Northwest Inupiat Housing Authority (NIHA, www.nwiha.com) provides housing construction,
community improvement, and weatherization services throughout the region and has an important role
to play in continued improvement of the housing stock. Additional support for this organization would
allow for more services to be provided to more people in the region, especially low-income families least
able to afford high heating costs. On a statewide basis, the Alaska Housing Finance Corporation (AHFC,
www.ahfc.us) provides additional energy efficiency and weatherization support, including energy
education, building monitoring, low interest loans, and weatherization improvements to income
qualified residents. RurAL CAP (https://ruralcap.org/) also provides weatherization services to homes in
rural Alaska. This service increases safety and energy efficiency through home improvements and client
education at no charge to the participant.
Bulk Fuel
Bulk fuel storage is another area of high variability among communities with significant impact on overall
fuel costs. This is a complicated issue for several reasons, including that in each community there are
typically at least three different bulk fuel storage systems owned and operated by different entities,
namely the local electric utility, the Northwest Arctic Borough School District, and a local fuel distributor
for homes and businesses. These three different entities generally purchase bulk fuel at different prices,
have different use patterns and O&M practices, and different economic incentive structures. For
example, because of electric utility rate structures, fuel cost is considered a “pass through” and as fuel
costs change, utilities simply add a “fuel surcharge” to their base rate and pass through the cost
variability to their customers. Alternatively, most School Districts have a fixed energy budget on an
annual basis, so if fuel costs rise, this impacts their ability to meet other needs whereas if fuel costs drop
or they become more energy efficient, they have additional revenue to spend elsewhere. As for local
fuel distributors selling home heating fuel, the difference between their purchase price of bulk fuel and
their retail sale price to individuals is often their main source of revenue, so there is incentive to mark
up this fuel to cover costs such as tank farm maintenance and provide revenue to their overall operation.
Some communities in the region such as Ambler are currently experiencing fuel availability limitations
because of bulk fuel storage challenges. This has resulted in days—sometimes weeks—in the winter
where there has been no residential home heating fuel available for the entire village. Ambler is currently
addressing this issue with pursuit of a new tank farm for the community to meet local heating fuel
demand but it is an expensive effort that without outside subsidies would likely add more than $1/gallon
to every gallon of fuel stored in the tank over its entire lifecycle.
Northwest Arctic Regional Energy Plan 21
On a larger, sub-regional scale, the communities in the Upper Kobuk, i.e., Ambler, Shungnak, and Kobuk,
are challenged with annual fuel barge deliveries because of the hydrology of the area. Specifically, when
the Upper Kobuk River clears out from ice coverage in late spring/early summer, the bulk fuel that is
targeted for this area has not
yet arrived in Kotzebue and
hence, is not available to be
barged up the Kobuk River. By
the time the large fuel barge
arrives in Kotzebue and the fuel
is transferred to a smaller river
barge, the water levels in the
Upper Kobuk River have often
dropped to the degree that the
Upper River is not navigable
and these three villages cannot
receive fuel by barge. When this occurs, fuel must be delivered by air shipment, adding as much as
$2/gallon for all fuel delivered by this method. Air delivery instead of fuel barge delivery occurs
approximately half the time but appears to be more frequent as precipitation and water levels drop as
a result of climate change and other dynamics.
Options that have been identified to address this challenge include building bulk fuel storage partway
up the Kobuk River, such as in Noorvik or Kiana, and filling the bulk fuel storage facility in the fall before
the Kobuk River freezes up, and then delivering
this fuel the next spring as soon as the River thaws
and there is still sufficient high water, thus
avoiding the bottleneck of fuel delivered to
Kotzebue too late in the summer to reach the
Upper Kobuk. As well, a dedicated river fuel barge
would be required for such an operation, thus
adding further costs. Additional economic and
logistical analysis would be required to fully
evaluate this option to determine if it would be
more cost effective than the current status quo,
taking into account the frequency of air delivered
fuel and possible fuel mitigation options such as
hydropower development on the Kogoluktuk River Figure 13. Aging Fuel Tanks in the Region
Figure 12. Braided River Illustrates the Hydrology Challenges of Fuel Delivery
Northwest Arctic Regional Energy Plan 22
near Kobuk that could theoretically power all three communities if an inter-tie were constructed
between Shungnak and Ambler (an inter-tie already exists between Shungnak and Kobuk).
In general, the transportation and storage costs associated with delivery of bulk fuel to the region will
continue to increase and become a larger portion of the overall cost as ships and tank farms age, even
though the base price of the fuel being delivered has increased and decreased over the years based on
global conflicts and changing supply and demand each year.
Electricity
Utilities have a major role to play in maintaining or, ideally, reducing the cost to generate power. Utilities
often aim to improve the reliability of their power systems and reduce the cost to generate power by
performing routine gen-set maintenance, maintaining distribution system infrastructure, upgrading
obsolete switchgear controllers, selecting high-efficiency replacement engines, and maintaining
redundant generation systems through prompt repairs. The reliability of a community electric system is
essential to keep the lights on and to keep the local water systems from freezing in the winter.
In the Northwest Arctic region there are four electric utilities: Buckland Electric Utility, serving Buckland;
Ipnatchiaq Electric Utility, serving Deering; Kotzebue Electric Association (KEA), serving Kotzebue; and
the Alaska Village Electric Cooperative (AVEC), serving all eight remaining villages in the region.
According to reported PCE data, the utility cost to generate power in each community is shown in Figure
$0.00
$0.10
$0.20
$0.30
$0.40
$0.50
$0.60
$0.70
$0.80
$0.90
$1.00
202020192018201720162015201420132012Total Cost of Power ($/kwh)Year
Utility Cost to Generate Power
Regional Average
Ambler
Buckland
Deering
Kiana
Kivalina
Kobuk
Kotzebue
Noatak
Noorvik
Selawik
Shungnak
Figure 14. Utility Costs to Generate Power (per $/kWh)
Northwest Arctic Regional Energy Plan 23
14. The regional average cost is indicated by the upper boundary of the green shaded area. All lines in
the green area represent utility costs to generate power that are below average for the region.
AVEC’s cooperative model shares the non-fuel operation and maintenance costs evenly across the 58
communities they serve within the state. Therefore, the differences in the cost to generate power across
the communities that are served by AVEC reflect the variation in the fuel costs for each community. KEA
has a long history of generating low-cost power by regional standards. This is due to both the larger scale
of the utility and the long term operational and managerial expertise at KEA. The smaller standalone
utilities, Buckland and Deering, have both been very innovative in terms of early adopters of wind-solar-
battery-diesel hybrid systems that resulted in diesels-off operation while still confronting cost and
reliability challenges.
High diesel gen-set fuel efficiency and low line loss are two key indicators of a well-maintained power
system where the utility is taking proactive measures to maintain and optimize the efficiency of the
generation system. Figure 15 shows the fuel efficiency and Figure 16 shows the line loss for each
community’s power system as reported to the PCE program. In this case, line loss values are calculated
by subtracting the total power sold and the station service power consumed by the power plant from
total power generated. Line loss values are not measured. As above, in each figure the regional average
11.0
11.5
12.0
12.5
13.0
13.5
14.0
14.5
15.0
15.5
202020192018201720162015201420132012Fuel Efficiency (kWh/gal diesel)Year
Fuel Efficiency
Regional Average
Ambler
Buckland
Deering
Kiana
Kivalina
Kobuk
Kotzebue
Noatak
Noorvik
Selawik
Shungnak
Figure 15. Fuel Efficiency (kWh/gal)
Northwest Arctic Regional Energy Plan 24
is indicated by the upper boundary of the shaded area. In the Fuel Efficiency Figure 15, lines above the
red shading indicate higher than the regional average fuel efficiency; in the Line Loss Figure 16, lines
within the green shading indicate lower than the regional average line loss.
The cost of electricity in rural Alaska is heavily influenced by the Power Cost Equalization program (PCE).
The state government currently subsidizes electricity costs in rural Alaska under the PCE program, where
electricity rates are often three to eight times higher than in urban Alaska. Established in the 1980s, the
PCE program aims to reduce high rural electricity costs for remote, diesel-dependent Alaska
communities so that it is nearly equal to the average cost of power in Anchorage, Fairbanks, and Juneau.
Currently, residential customers and community facility buildings in nearly 200 communities across the
state—including all communities in the Northwest Arctic —are eligible for the reduced rate up to a
certain amount of kWh per month 7. Based on the PCE reporting data, the figure below shows the amount
of electricity sold by sector for all NANA villages except Kotzebue. Both residential and Community
Facility sectors are eligible for PCE payments within certain limits. The “Other kWh Sold (Non-PCE)”
sector includes local businesses, government facilities like the Post Office, and the local school. Note that
including Kotzebue in this graph would have required a significantly different scale for all the
7 According to the PCE formula, individual households are eligible for a reduced rate through the PCE subsidy on the first 500
kWh/month of electricity consumed, while monthly electric bills for “community facilities,” such as City and Tribal Council
buildings and streetlights, are eligible for the PCE subsidy based on total population of the community times 70
kWh/month/person.
2%
4%
6%
8%
10%
12%
202020192018201720162015201420132012Line Loss (%)Year
Line Loss
Regional Average
PCE Maximum
Ambler
Buckland
Deering
Kiana
Kivalina
Kobuk
Kotzebue
Noatak
Noorvik
Selawik
Shungnak
Figure 16. Line Loss %
Northwest Arctic Regional Energy Plan 25
communities to fit on the same page and the details for the small communities would not have been
visible.
PCE payments from the state are largely calculated from a utility’s total diesel fuel costs. If the utility
takes action to reduce its diesel fuel usage—such as from implementing renewable energy or investing
in powerplant efficiency upgrades—the PCE subsidy will be reduced. This essentially creates a
disincentive for the utility to reduce diesel fuel consumption since eligible end-users do not receive a
rate reduction when diesel fuel use is reduced. Common sense would suggest that, all else being equal,
if less diesel fuel is used to produce the same amount of kWh, the price per kWh should go down. But
this is often not the case because of the PCE formula that is written into Alaska state statute.
Within the PCE calculation for reimbursement to an electric utility, an eligible expense is the cost of
power purchased from another entity. In other words, if a PCE eligible utility buys electricity in bulk from
another entity in the community and then sells that power on a retail basis to its residential and
commercial rate payers, the utility’s cost of that purchased power can be included as a PCE-eligible
expense. This is considered similar to purchasing diesel fuel, and it will be reimbursed by the state under
the PCE formula. Hence, renewable energy development, and resulting diesel fuel reduction, can be
incentivized—or, at a minimum, not penalized—by establishing an Independent Power Producer (IPP) in
the community that develops and sells the renewable energy to the utility. As a result, the utility can
include this power purchase as a generation cost (instead of diesel fuel) and preserve its PCE subsidy
from the state. In other words, as a result of renewable energy generated and sold by an IPP, the utility’s
194,991
239,822
375,559
443,464
669,544
537,964
703,374
783,519
844,165
992,465
151,321
103,802
190,004
281,156
150,776
298,912
273,561
312,176
411,111
683,733
242,939
308,920
311,476
446,066
510,518
585,236
540,793
669,427
601,585
757,175
0 500,000 1,000,000 1,500,000 2,000,000 2,500,000
Kobuk
Deering
Shungnak
Ambler
Buckland
Kivalina
Kiana
Noatak
Noorvik
Selawik
Annual Energy Sold (kWh)
Residential kWh Sold Community Facility kWh Sold Other kWh Sold (Non-PCE)
Figure 17. Annual Energy Sold (kWh), Broken Down by Customer Type (Not Including Kotzebue)
Northwest Arctic Regional Energy Plan 26
diesel fuel costs decrease, but its overall PCE eligible costs roughly stay the same or increase, and the
net result is the same PCE payment to the utility. In addition, there is now an IPP in the community that
has revenue it receives from selling renewable energy-generated power to the utility. This IPP revenue
can be the basis for new economic development if the money stays in the community.
The economic contribution of PCE in any given community, or combined across the region, is
considerable. The following table illustrates this in detail.
Table 4. PCE Subsidy Summary by Community, 2019
Community Total kWh
Generated
Amount of
PCE Eligible
kWh
% Eligible PCE
kWh vs Total
kWh
Average PCE
payment per
eligible kWh
Total PCE $
Provided by
State 8
Kotzebue 19,495,001 5,193,926 26.6 $0.17 $882,967
Ambler 1,203,842 512,557 42.6 $0.35 $179,395
Kobuk 589,251 244,188 41.4 $0.37 $90,349
Shungnak 935,175 401,851 43.0 $0.37 $148,684
Kiana 1,559,473 704,591 45.2 $0.36 $253,652
Noorvik 1,889,048 941,454 50.0 $0.30 $282,436
Selawik 2,474,856 1,194,311 48.3 $0.31 $370,236
Buckland 1,370,629 559,286 40.8 $0.11 $61,521
Deering 679,579 288,781 42.3 $0.34 $98,185
Kivalina 1,462,209 504,690 34.5 $0.34 $171,594
Noatak 1,809,413 814,374 45.0 $0.54 $439,762
Total 33,468,477 11,360,009 33.9% -- $2,978,785
From Table 4, we can see that approximately $3 million was directed to the region through the PCE
program in 2019 9. About one-third of all kWh generated received the PCE subsidy (33.9%). For all PCE
eligible kWh generated, the PCE subsidy cut the cost of those kWh often by more than 60%, depending
on the community.
While diesel-based power generation is the backbone of all electricity systems in the region, renewable
energy production primarily from wind and solar power are increasingly common and contributing
significantly more to communities’ overall electricity needs. Below we examine several case studies from
the region to identify successes and areas that still need improvement.
8 Total does not add exactly because of rounding error.
9 Statewide, the PCE program provides about $26 million to eligible rural Alaska communities.
Northwest Arctic Regional Energy Plan 27
Renewable Energy and Battery Storage Microgrid Case Studies
Deering
The Ipnatchiaq Electric Company in
Deering, Alaska, owned by the City of
Deering, currently operates an electric
utility system utilizing diesel, wind, and
solar generation resources. The system
also contains a battery and power
converter system that helps to maintain
high quality power and store energy
during times of high wind and solar power
output. The wind generation system is
rated at 100 kW peak output, the solar
photovoltaic (PV) system is rated at 48.5
kW (DC panel output), the battery has a
storage capacity of 109 kWh, and the
converter has a maximum power output of
195 kW. Average generation
requirements, i.e., electrical system load or community demand, are about 75 kW for the community,
while the peak generation requirement during the highest demand time of the winter is about 185 kW.
Figure 18 summarizes these component sizes.
These are maximum generation outputs; wind and solar generation are intermittent and only produce
at these levels when there is sufficient wind blowing or sun shining, so they cannot produce at maximum
output for the entire year. When there is less wind or less sun, these technologies still produce electricity
but at a percentage of their total rating, depending on the amount of wind or sun available. Figure 19
below shows the portion of the total generation requirements that are satisfied by wind and solar for
each month in the data collection period.
Figure 18. Deering Renewable Component Sizes Relative to Average
Community Demand
Northwest Arctic Regional Energy Plan 28
Wind and solar generation accounted for 13.0% of total generation between October 2019 and February
2022 and displaced roughly an equivalent amount of diesel fuel.
Over the course of the hybrid system’s short lifetime there have been various challenges, such as digital
communication among all the various generation assets and wind turbine downtime, that have resulted
in sub-optimal performance. These issues continue to be identified and resolved through combined
efforts of NANA, NAB, contractors, and the dedicated staff of Ipnatchiaq Electric Company in Deering
and are showing ongoing performance improvements. Preliminary modeling indicated—and short-term
performance has demonstrated—potential for up to 40% fuel displacement annually. Reaching this
milestone will be a significant contribution toward lowering fuel costs and increasing reliability of the
system.
Figure 19. Deering Percent Renewable Generation by Month
Northwest Arctic Regional Energy Plan 29
Buckland
In Buckland, Alaska, the City owns and
operates the Buckland Electric Utility
system which utilizes diesel, wind, and
solar generation resources. The system
also contains a battery and power
converter system that helps to maintain
high quality power and store energy during
times of high wind and solar power output.
The wind generation system is rated at 200
kW peak output, the solar photovoltaic
(PV) system is rated at 46 kW (DC panel
output), the battery has a storage capacity
of 218 kWh, and the converter has a
maximum power output of 277 kW.
Average generation requirements, i.e.,
electrical system load or community demand, are about 215 kW for the community, while the peak
generation requirement during the highest demand time of the winter is about 350 kW. Figure 20
summarizes these component sizes relative to community demand.
These are maximum generation outputs; wind and solar generation are intermittent and only produce
at these levels when there is sufficient wind blowing or sun shining, so they cannot produce at maximum
output for the entire year. When there is less wind or less sun, these technologies still produce electricity
but at a percentage of their total rating, depending on the amount of wind or sun available. Figure 21
below shows the portion of the total generation requirements that are satisfied by wind and solar for
each month in the data collection period.
Figure 20. Buckland Renewable Component Sizes Relative to Average
Community Demand
Northwest Arctic Regional Energy Plan 30
Wind and solar generation accounted for 13.6% of total generation between January 2021 and February
2022.
Batteries are reducing black and brown-outs within the community. There are significant cost savings
related to the prevention of black-outs. Black-outs lead to accelerated failures of appliances and
electronics and increase the number of freeze-ups of water and sewage systems as well as residential
service lines. The renewable energy, storage, and power conversion systems are similar in Buckland and
Deering. Modeling prior to full installation estimated approximately 35% fuel displacement at optimized
performance levels. Some of the same challenges with digital communication, wind turbine uptime, and
diesel generator performance have reduced the fuel savings to date, but the lessons learned with
optimizing software controls, operator training, and other measures are resulting in improved
performance over time and are providing a positive feedback loop by sharing information with Deering.
Shungnak & Kobuk
AVEC currently operates an electric utility system utilizing diesel and solar generation resources that is
based in Shungnak but also powers Kobuk through a 10-mile intertie, hence serving two communities.
Figure 21. Buckland Percent Renewable Generation by Month
Northwest Arctic Regional Energy Plan 31
The system also contains a battery
and power converter system that
helps to maintain high quality
power and store energy during
times of high solar power output.
The solar photovoltaic (PV) system
is rated at 224 kW (DC panel
output), the battery has a storage
capacity of 384 kWh, and the
converter has a maximum power
output of 250 kW. Average summer
generation requirements are about
229 kW for the two communities
combined (when the solar PV is
generating most of its power on an
annual basis), while the peak generation requirement during the highest demand time of the winter is
about 300 kW. Figure 22 summarizes these component sizes.
Figure 23 below shows the power production at a system level for the first two weeks of March 2022.
The red line indicates the power produced by the diesel generators. The green line indicates the power
produced by the solar PV. The yellow line is for the battery, indicating power stored by negative values
and power released to the grid by positive values. The orange line is the power demand of the system.
As the solar resource rapidly increased in early March the solar power generation increased each day,
offsetting increasingly larger amounts of power that would have been generated by the diesel
generators, as seen by the sharp dips in the red trend line in the middle of each day, despite the system
demand maintaining a value near 250 kW. The power being stored or released by the battery fluctuates
throughout the sunny hours of the day to stabilize the grid, especially when clouds occlude the solar
panels causing a sudden drop in solar PV generation.
0
50
100
150
200
250
300
Solar Panels BatteryMaximum Output, kWShungnak & Kobuk Renewable System Sizes
Peak Generation Requirement
Average Generation Requirement
Figure 22. Shungnak/Kobuk Renewable Component Sizes Relative to Average
Community Demand
Northwest Arctic Regional Energy Plan 32
Figure 23. Shungnak Solar Production Over a Two-Week Period in March 2022
A more detailed example of the daily power production trends is shown in Figure 24. This more granular
data provides a more detailed understanding of the solar, diesel, and battery interaction over a single
day with cloud coverage impacting the solar output (in green).
Figure 24. Detailed Data for Solar, Diesel, Battery Over a Single Day
Northwest Arctic Regional Energy Plan 33
The diesel generators, solar PV,
and battery storage (via the
converter) are automatically
controlled such that they work
together to provide a dynamic
response to changes in power
demand and power generation,
optimizing the available solar
energy and minimizing the diesel
fuel consumption. From its
installation in September of 2021
through April of 2022, the
Shungnak solar PV with battery storage system has offset an estimated 39 tons of CO2 and saved an
estimated $24,800.
Kotzebue
Kotzebue Electric Association in Kotzebue, Alaska currently operates an electric utility system utilizing
diesel, wind, and solar generation resources. The system also contains a battery and power converter
system that helps to maintain high quality power and store energy during times of high wind and solar
power output. The wind generation
system is rated at 1.8 MW peak output,
the solar photovoltaic (PV) system is
rated at 576 kW (DC panel output), the
battery has a storage capacity of 950
kWh, and the converter has a maximum
power output of 1.225 MW. Average
generation requirements are about 2.5
MW for the community, while the peak
generation requirement during the
highest demand time of the winter is
about 3.4 MW. Figure 26 summarizes
these component sizes.
Figure 25. Shungnak Solar Array (Photo Courtesy of Ingemar Mathiasson, NAB)
Figure 26. Kotzebue Renewable Component Sizes Relative to Average Community
Demand
Northwest Arctic Regional Energy Plan 34
Figure 27 below shows KEA’s solar energy production for all of 2021 and lifetime energy generated by
the system from installation in May of 2020 through April 10, 2022.
Figure 27. KEA Solar PV Production in 2021 and over Project Lifetime
Northwest Arctic Regional Energy Plan 35
Technology Pricing & Trends
Within the energy industry globally, use of fossil fuels and diesel generators are among the most mature
and widespread technologies. This applies to essentially all of rural Alaska including the Northwest Arctic,
i.e., diesel generation systems form the backbone of remote power infrastructure. However, renewable
energy and storage technologies such as solar PV, wind turbines, and lithium-ion batteries are
increasingly common in the contiguous United States and starting to appear in the Northwest Arctic and
other regions of Alaska. Most recent and future renewable electricity generation projects are expected
to include the renewable technology plus battery storage. This results in technology prices for solar,
wind, and batteries that are decreasing significantly over time, especially over the last decade as mass
production and product reliability have increased. However, very recent global supply chain disruptions
and sharp fossil fuel price escalations have altered this downward trend.
Within the Northwest Arctic, overall renewable energy project costs have declined as lessons learned
from each project have been incorporated into each subsequent project. For example, Buckland and
Deering have very similar PV installations and were funded from the same grant award, but Buckland
was designed and constructed a year before Deering. Although the PV configuration was similar – both
communities used three BoxPower 20-foot shipping containers with their proprietary racking design—
in Buckland, the system used three individual string inverters (one for each shipping container) and an
Figure 28. Buckland Solar Array
Northwest Arctic Regional Energy Plan 36
electrical combiner, whereas in Deering the system used a single, larger inverter that incorporated all
three shipping containers’ production into a single output. This one modification saved several thousand
dollars on the inverter and combiner system hardware and installation labor while making the required
integration with the existing diesel and microgrid control system much simpler and more cost effective
in Deering. Further, because the solar PV industry continues to innovate and squeeze more power
conversion capacity onto the same size solar panel each year, the total nameplate capacity for the
Deering system (48.5 kW) is larger than the Buckland system (46 kW) despite the same amount of solar
panels and a lower cost per panel for Deering since it was installed a year later. Such trends point to
inherently lower installed costs on a dollar/kW basis for future systems.
The Kotzebue solar PV system, which was installed the year after the Deering system, benefitted further
from the solar PV industry’s ongoing efficiency improvements by installing bi-facial panels, with a higher
capacity, for essentially the same price as single-sided panels in all previous installations. All projects
since Kotzebue have been specified with bi-facial panels, which continue to improve in energy density
for the same size solar panel each year. Similarly, the Shungnak-Kobuk solar PV system, which was
installed a year after Kotzebue’s and used identical ground screws for mounting the solar panels,
benefitted significantly from an improved drilling technique and more specialized equipment to more
easily place the ground screws in permafrost than what was used in Kotzebue.
All of these lessons were transferred and applied to the next project because of the consistency of the
main project overseers and good communication among stakeholders, especially NAB and NANA Energy
Program staff and contractors, the local utilities, and the Northwest Arctic Energy Steering Committee.
Figure 29. Shungnak Battery Building (Photo Couretsy of Ingemar
Mathiasson)
Figure 30. Batteries for Shungnak, Prior to Installation (Photo
Courtesy of Ingemar Mathiasson)
Northwest Arctic Regional Energy Plan 37
Another important innovation and trend that has benefitted from technology transfer among projects is
the overall performance and efficiency of the battery energy storage system housing, which is necessary
to protect the BESS from extreme temperatures and provide a safe working environment for basic
maintenance and repairs. Specifically, the Buckland and Deering BESS housing includes a large isolation
transformer, which generates a significant amount of heat such that even for much of the winter, the
BESS building requires cooling to keep the batteries at proper operating temperature. By the time the
BESS building in Shungnak was constructed, it was determined that the isolation transformer could be
placed outside the building, thus reducing cooling loads and improving use of renewable energy.
More broadly, as multiple renewable energy projects have now been developed across the region, a
generic project development process has been identified that helps to streamline future projects and
workplans and translates into reduced construction costs and shorter development timelines.
The overall development process for installing and integrating a renewable energy hybrid system into
an existing diesel electric grid consists of the following:
o Communication and coordination with all stakeholders, including community leadership
and local electric utility
o Identify funding
o Upgrade power plant controls if needed
o Upgrade switchgear if needed
o System design, including sizing to optimize renewable production, battery charging,
power conversion, and alternative heating
o Siting – technical considerations and community preference
o Geotech and soils
o Permitting
o RFP process
Contractor selection
Equipment procurement
Logistics, shipping
Local support, training and workforce development
o Public education, reporting, performance monitoring
Another notable trend that has evolved as the renewable energy projects have continued proliferating
across the region, and is expected to continue with future projects, is the establishment of community-
based Independent Power Producers (IPPs) to develop the projects and sell power to the local utility.
This structure has emerged as a method to preserve Power Cost Equalization (PCE) payments in
Northwest Arctic Regional Energy Plan 38
communities that implement more renewables and are at risk of losing PCE support as their diesel fuel
consumption decreases. Pioneered in the communities of Deering (with a City-owned local electric
utility) and in Shungnak-Kobuk (with a statewide electric cooperative, AVEC, as the local electric utility),
this IPP structure appears to be effective at enhancing community engagement and ownership in the
new projects, creating local jobs, and improving regional cohesion and accountability as the NAB and
NRC maintain an oversight and coordination role in the overall process and implementation.
Regional Energy Opportunities
The Northwest Arctic Borough and NANA region have diverse energy needs and interests. Below is a
detailed list of the technology options region-wide. The descriptions summarize the opportunities and
limitations associated with each technology as well as the communities where each technology is viable
or has already been implemented. The Projects and Opportunities Matrix, included in the Appendix,
provides additional details regarding the current status of each technology in each community as well as
a regional perspective for aggregating projects and opportunities.
Reduce Cost of Home Heating
• Weatherize aging homes
o 47% built before 1980 and have not received any weatherization upgrades
Of these homes, 11% consume 4x the energy of a modern home – highest priority
for weatherization efforts
• Maintain & upgrade heating infrastructure
• Develop a regionalized stove oil purchasing strategy
• Develop renewable energy & battery storage projects to increase electric thermal options
o Heat pumps
o Dispatchable electric heating
Limitations:
• Region-wide weatherization will be a major undertaking given the pervasive need
• Renewable energy & battery storage projects cannot provide short-term relief
• Heat pumps are only cost-effective when the ratio between high fuel costs and low electricity costs
is above a certain threshold
• Heat pump efficiency decreases as ambient temperatures drop such that deep winter heating is
generally not a realistic option
Opportunity: All communities
Northwest Arctic Regional Energy Plan 39
Wind
• Power is generated from wind energy year-round
• Excess wind energy can be dispatched for home heating and/or water system heating
Limitations:
• Power generation is intermittent
• A control system is required to integrate the wind turbine into the power system
• Expensive annual preventative maintenance is required for wind turbine
• Wind resource must be characterized through on-site measurement
• Appropriate wind turbine must be identified based on wind regime—there are limited
models of small (< 1 MW) wind turbines and high per unit costs
• Wind resource is not present throughout the region
Possible Opportunity: Ambler, Kiana, Kivalina, Kobuk, Noatak, Noorvik, Selawik, Shungnak
Accomplished: Buckland, Deering, Kotzebue
Utility Solar
• Power is generated on a predictable schedule during daylight hours with clear skies
• Minimal preventative maintenance is required for a solar PV array
• Solar resource data is used to model power generation from a solar PV array—no data collection is
required
• Solar PV array sizing can be determined based on modeling
Limitations:
• No power is generated during the coldest part of the year nor whenever the sun is not present
• A control system is required to integrate the solar PV array into the power system
Opportunity: All communities
Accomplished: Buckland, Deering, Kobuk, Kotzebue, Noatak*, Noorvik, Shungnak (*In progress at time
of publication)
Battery Storage
• Pair battery storage with renewable energy generation to stabilize the power system and enhance
the effectiveness of renewable energy systems
• Identify appropriate battery storage and converter size based on energy system modelling
Limitations:
• Battery storage is expensive and not a power generation source
Northwest Arctic Regional Energy Plan 40
• A control system is required to integrate the battery storage system into the power system
Opportunity: Ambler, Kiana, Kivalina, Noorvik, Selawik
Accomplished: Buckland, Deering, Kobuk, Kotzebue, Noatak*, Shungnak (*In progress at time of
publication)
Hydroelectric
• Power is generated from hydro energy year-round
• Excess hydro energy can be dispatched for home heating or water system heating
• Upper Kobuk Cosmos Hills hydroelectric project would provide power to Ambler, Shungnak, and
Kobuk if intertie is constructed between Shungnak and Ambler
Limitations:
• Upper Kobuk Cosmos Hills hydroelectric project is a high-cost project due to the large scale
• Power generation from Upper Kobuk Cosmos Hills hydroelectric project would vary seasonally
• Viability of Upper Kobuk Cosmos Hills hydroelectric project depends on construction of an electrical
intertie between Shungnak-Kobuk and Ambler, adding additional costs
• Financial viability of Upper Kobuk Cosmos Hills hydroelectric project depends on outcomes of
feasibility study to estimate heat loads in Ambler, Shungnak, and Kobuk
• Hydropower production is much restricted in winter
Opportunity: Ambler-Kobuk-Shungnak, Kotzebue (may also have seasonal hydropower resource)
Accomplished: None
Community-Scale Biomass
• Heat is generated from biomass energy year-round
• Revenues from biomass fuel stay in the community
Limitations:
• Assessment of wood biomass energy resources must be conducted
• A biomass harvest plan must be developed that accommodates all local stakeholders
• Community must be invested in harvesting the required biomass fuel annually
• A storage facility must be constructed or allocated to store wood and keep wood dry
• Wood resource is limited, especially in the lower Kobuk
Opportunity: Kiana, Kotzebue, Noatak, Noorvik
Accomplished: Ambler*, Kobuk (In progress*)
Intertie
Northwest Arctic Regional Energy Plan 41
• Expansion of opportunities to install large-scale renewable generation sources to serve multiple
communities
• Reduction of power plant operations and maintenance costs for system if extra power plants
are downgraded to back-up power plants
Limitations:
• Routine maintenance is required for long-term upkeep of tie-line
• Long tie-lines will result in line loss
• Tie-lines are expensive and serve relatively small loads
Opportunity: Ambler-Kobuk-Shungnak, Kiana-Noorvik-Selawik
Accomplished: Shungnak-Kobuk
Independent Power Producer (IPP)
• Tribe or City can own energy infrastructure and generate jobs and revenue for maintenance or
expansion of energy infrastructure
• Eliminates negative incentive of reduced PCE subsidy associated with addition of renewable energy
generation to power system
Limitations:
• Agreement must be formed between Tribe or City and the local utility to sell and purchase power
• State of Alaska must approve power purchase agreement for PCE qualification
Opportunity: Ambler, Kiana, Kivalina, Kotzebue, Noatak, Noorvik, Selawik
Accomplished: Buckland*, Deering*, Shungnak, Kobuk (*In progress)
Generator Upgrades
• Enhanced fuel efficiency can be achieved through new and appropriately sized generators
• Engines with marine manifolds expand the opportunity for heat recovery
• Many communities are eligible for the EPA DERA program regardless of utility ownership
Limitations:
• Integration of renewable energy sources may reduce the fuel efficiency of generators if not sized
correctly
• Generator replacement is expensive and up to the discretion of the utility
Opportunity: Kobuk, Kotzebue, Noatak, Selawik
Accomplished: Ambler, Buckland*, Deering*, Kiana, Kivalina*, Noorvik*, Shungnak (*In progress)
Northwest Arctic Regional Energy Plan 42
Automated Switchgear
• Facilitates smooth, automatic switching between generators to enhance grid stability and
improve fuel efficiency
Limitations:
• Often a requirement for integration of renewable energy sources and control system
• Can be high cost
Opportunity: Ambler, Kiana, Kivalina, Kotzebue, Noorvik, Selawik
Accomplished: Buckland, Deering, Noatak, Shungnak
Recovered Heat
• Utilizes excess heat from generators to provide heat to buildings and/or water system
• Inexpensive source of heat
Limitations:
• Heat is most efficiently used when buildings served are nearby the power plant
• Power plant cannot rely on recovered heat system to dissipate excess heat from generators
• Can be high cost
Opportunity: Ambler, Buckland, Kotzebue, Selawik
Accomplished: Deering*, Kiana, Kobuk, Noatak, Noorvik, Shungnak (*In progress)
Energy Efficiency
Community
• LED street light upgrades, where not already complete
• Weatherization of aging community buildings
• Energy audits of community buildings and completion of recommendations
• Energy audit of water treatment plant and completion of recommendations
Residential
• Residential LED lighting upgrades
• Upgrade residential heat trace to circulation pumps
• Weatherization of aging homes
• Residential heating infrastructure repair and/or replacement
Limitations:
• Region-wide weatherization will be a major undertaking given the pervasive need
Northwest Arctic Regional Energy Plan 43
• Funding for energy efficiency upgrades may be more difficult to obtain than funding for capital
projects
Opportunity: All communities
Accomplished: All communities
Heat Pumps
• Technology has been proven to be effective for home heating in Arctic environments
• Heat pump calculator developed for NAB/NANA region to determine site-specific cost-
effectiveness 10
• Additional benefits of providing cooling in the summer months and improved indoor air quality
from filtering system
Limitations:
• Cannot be efficiently operated in temperatures below -5 °F
• Heat pumps are only cost-effective when the ratio between high fuel costs and low electricity
costs is above a certain threshold
• Potential impacts to electric grid from increased peak demand if all heat pumps operating
simultaneously
Opportunity: Deering, Buckland, Kiana, Kivalina, Kobuk, Kotzebue, Noatak, Noorvik, Selawik, Shungnak
Accomplished: Ambler
Energy Related Training and Regional Services
• Conduct outreach program to expand awareness of residential energy consumption and
methods for reduction
• Establish local or regional expert to service boilers, oil stoves, heat pumps, etc.
• Establish electricians and mechanics available to be hired to work on energy systems
throughout regions—utilize Kotzebue as regional hub
Limitations:
• Entity would be needed to manage program offering regional technician services, electricians
and mechanics
• Limited regional availability of trained technicians, electricians, and mechanics
Opportunity: All communities
Accomplished: None
10 https://heatpump.cf/
Northwest Arctic Regional Energy Plan 44
Projects and Opportunities Matrix
Through this effort to update the Regional Energy Plan, the need was identified for a comprehensive
record of the current project status and future project opportunity for each energy efficiency or
renewable energy generation technology in each community. The Projects and Opportunities Matrix
captures this information at a detailed level in a condensed, color-coded format. The categories captured
in this spreadsheet include wind, utility solar, water plant solar, battery storage, hydro, community-scale
biomass, geothermal, intertie, IPP, generator upgrades, automatic switchgear, recovered heat,
residential biomass, and energy efficiency. Additionally, the matrix captures the top three highest
priority projects for each community. These projects were identified because of the intersection of
technical feasibility, community support, and funding opportunities. The Projects and Opportunities
Matrix is meant to be a living document that is updated regularly to reflect updated project statuses,
completed opportunities, and changing funding opportunities. The Projects and Opportunities Matrix is
included in the Appendix.
Community Energy Profiles
As part of this Regional Energy Plan update, a Community Energy Profile was developed for each
community. Each profile captures the basic energy system information for each community, recent
energy-related projects, future energy-related projects, and community energy goals. The profiles also
include a selection of energy trends that use data from PCE Program reporting to show trends in energy
data for each community over the last ten years. The trends include population, fuel efficiency, line loss,
utility cost to generate power, contribution of fuel and non-fuel costs to the overall cost of power
generation, annual power generation, annual power generation per capita, and PCE impact on average
annual residential cost of electricity per capita. Each profile was developed through a process of
reviewing past studies and documents, collecting energy system information from the utilities, collecting
past project data from local and regional stakeholders, trending reported data from the PCE program,
conducting a community meeting to understand the goals and perspectives of each community, and
conducting a review of the draft profiles with each community, where possible. All of the Community
Energy Profiles are included in the Appendix.
Conclusions
The Northwest Arctic continues to demonstrate innovation and commitment to clean energy
development and enhanced energy security for all stakeholders and community members. The NAB and
NANA Village Energy Programs have provided the technical leadership, fundamental resources, and
Northwest Arctic Regional Energy Plan 45
consistency over many years to apply lessons learned and continually improving technology for the
betterment of the region and improved quality of life. The nation’s first arctic wind energy deployments,
the first wind-solar-battery-diesel hybrid systems operating in diesels-off mode, the establishment of
community-based IPPs with regional support, hundreds of thousands of gallons of diesel fuel saved
annually, and currently the largest solar PV array in rural Alaska are among the region’s energy successes.
Despite these impressive accomplishments, energy costs remain high and long-term regional energy
goals still require significant and prolonged effort if they are to be achieved. With extreme weather
experienced in the 2021-2022 winter, combined with extreme energy prices in early 2022, the region is
in the midst of a home heating crisis with limited quick-fix options. Energy efficiency measures and
potentially heat pumps could provide some relief, but lower cost renewable energy owned by local IPPs
and more control over fossil fuel deliveries to the region will be necessary to leverage the full portfolio
of solutions to the persistent energy challenges in the region.
More broadly, achieving the region’s energy vision and specific fuel and cost reduction goals will require
a combination of investment, technology and human capacity building. Regional efforts based in
Kotzebue and supported by various institutional partners, with technical support and outreach to the
surrounding communities, presents a promising model for service delivery and improved system
efficiency and reliability. As hybrid systems continue to increase in complexity such a regional support
model will only become more important. Economies of scale that can be leveraged to reduce capital as
well as operation and maintenance costs are also enhanced by collaboration within and among
communities.
No plan is ever complete and will always require adjustments based on new information. However, this
energy plan has attempted to combine the lessons and accomplishments of the past to inform activities
and recommendations for the future. The leadership, institutions, shareholders, and citizens in the
Northwest Arctic Borough/NANA region continue to invest time, energy, and resources to support the
vital lifestyles and aspirations of the unique people and landscapes that make the Northwest Arctic an
inspiring and special place to live.
Northwest Arctic Regional Energy Plan 46
Appendices
A. PROJECTS AND OPPORTUNITIES MATRIX
B. AMBLER COMMUNITY ENERGY PROFILE
C. BUCKLAND COMMUNITY ENERGY PROFILE
D. DEERING COMMUNITY ENERGY PROFILE
E. KIANA COMMUNITY ENERGY PROFILE
F. KIVALINA COMMUNITY ENERGY PROFILE
G. KOBUK COMMUNITY ENERGY PROFILE
H. KOTZEBUE COMMUNITY ENERGY PROFILE
I. NOATAK COMMUNITY ENERGY PROFILE
J. NOORVIK COMMUNITY ENERGY PROFILE
K. SELAWIK COMMUNITY ENERGY PROFILE
L. SHUNGNAK COMMUNITY ENERGY PROFILE