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Phase II Summary and Strategic Energy Efficiency Plan
FALSE PASS
RACEE Phase II Summary & Implementation Plan False Pass
2 August 22, 2016
Table of Contents
Introduction ........................................................................................................................................................... 3
RACEE Phase II Summary ................................................................................................................................... 3
Pre-visit energy data/community information collection .................................................................................. 4
Site visit and community stakeholder meeting ................................................................................................. 5
Regional liaison site visit .................................................................................................................................. 5
Non-residential building inventory ................................................................................................................... 5
Energy audits of five public buildings .............................................................................................................. 6
Energy audits of up to 30 residences ................................................................................................................ 6
School heat recovery feasibility analysis .......................................................................................................... 6
Community energy use and tracking analysis ................................................................................................... 7
Financing options assessment ........................................................................................................................... 7
Community-wide strategic energy efficiency plan ........................................................................................... 7
Energy Use Profile: 2010 Baseline vs. 2015 Use ................................................................................................. 7
Implementation Plan Description ......................................................................................................................... 8
Stakeholder Engagement Plan .............................................................................................................................. 9
Estimated SEEP Impact ........................................................................................................................................ 9
SEEP Project Financing ...................................................................................................................................... 10
Energy Financing Options Assessment .......................................................................................................... 10
The High Cost of Delay .................................................................................................................................. 11
Next Steps ........................................................................................................................................................... 11
Appendices ......................................................................................................................................................... 13
A: Phase I Pledge ............................................................................................................................................ 13
B: Phase II Application ................................................................................................................................... 13
C: Building Inventory ..................................................................................................................................... 13
D: Non-residential Audit Report ..................................................................................................................... 13
E: Residential Energy Use Analysis ............................................................................................................... 13
F: School Heat Recovery Feasibility .............................................................................................................. 13
G: Energy Use Model ..................................................................................................................................... 13
H: Financial Analysis ...................................................................................................................................... 13
RACEE Phase II Summary & Implementation Plan False Pass
3 August 22, 2016
Introduction
The Remote Alaskan Communities Energy Efficiency (RACEE) program is a US Department of
Energy (DOE) competition that challenges rural Alaskan communities to commit to reducing
their energy use 15% by 2020 (baseline 2010), which aligns with the State’s Energy Efficiency
goal. In January 2016, 64 communities submitted pledges to become energy champions and
move to the next phase of the competition. In April, DOE announced that 13 communities
would be eligible to apply for up to $3.4 million in funding to implement the community energy
efficiency plans they develop in Phase II of the competition. False Pass is one of those 13
communities and one of three eligible communities in the Aleutians region.
In keeping with the goals of the RACEE program, the community of False Pass is committed to
reducing their per capita energy use 15% by the year 2020 (see Appendix A – Phase I Pledge).
The City of False Pass, The False Pass Tribe, and the Isanotski Corporation are all signatories on
the RACEE application and industry leaders have pledged their support as well. In order to
accomplish this community goal, RACEE funding will provide False Pass with a means to
pursue energy efficiency retrofits and expand existing efforts towards utilizing waste recoverable
heat.
The community of False Pass is incredibly remote and only receives fuel on periodic barge
deliveries. While the community is pursuing two different renewable energy projects, they are
currently dependent on diesel for all electricity generation. With heating oil prices at
$4.39/gallon and electricity prices at $0.45/kWh, all members of the community have been
focused on improving energy efficiency for years. The City, Tribe, Native Corporation,
homeowners, and local seafood industry have all performed energy audits in recent years and
some buildings in False Pass have received multiple weatherizations. The City-owned electric
utility is also taking advantage of waste heat in the powerhouse and transferring it to another Cit y
building. The community has shown a clear commitment to energy efficiency and is an example
for many other small, remote Alaskan communities struggling with extreme energy prices and
diesel dependence.
RACEE Phase II Summary
Because the community is already versed and engaged in energy efficiency, they chose to apply
for topic area one – they are able to identify and prioritize their opportunities (see Appendix B –
Phase II Application). False Pass applied for technical assistance in analyzing the following:
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1. Community-wide distribution upgrade
2. Non-residential lighting retrofit
3. HVAC Upgrades
4. Community energy efficiency MOA’s
5. Residential weatherization
6. Heat loop to school
DOE removed or downscoped some of these items. For instance, reviewers believed that False
Pass’s line loss was not severe enough to justify the technical assistance because it did not
exceed the Regulatory Commission of Alaska’s (RCA) standard of 12% used in Power Cost
Equalization (PCE) calculations. In other cases, the Phase II budget awarded to False Pass did
not cover all analysis requested. DOE also added a number of tasks included in all RACEE
awards. The Alaska Energy Authority (AEA) committed staff time and expertise, where
possible, to restore some requested tasks. The heat recovery analysis is one such example.
After all of the scope changes, the following tasks were funded and carried out:
1. Pre-visit energy data/community information collection
2. Site visit and community stakeholder meeting
3. Regional liaison site visit
4. Non-residential building inventory
5. Energy audits of five public buildings
6. Energy audits of up to 30 residences
7. School heat recovery feasibility analysis
8. Community energy use and tracking analysis
9. Financing options assessment
10. Community-wide strategic energy efficiency plan
The following section explains what each task entails, how the technical assistance was
administered, what the results were, and any additional recommendations based on the technical
assistance.
Pre-visit energy data/community information collection
Sam Tappen, the AEA project manager, spent a substantial amount of time researching the
community, their requested technical assistance, and the best way to fulfill each task. Much of
this time was spent analyzing False Pass’s energy data provided through the application, past
audit reports, PCE filings, regional energy plans, and a number of other State sources. Several
documents came about as a result, including a community profile, an energy profile, a PCE data
analysis, maps, preliminary calculations and more. This task ultimately provided the project
manager with the in-depth understanding needed to plan and perform the site visit.
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Site visit and community stakeholder meeting
The project manager coordinated a site visit along with all contractors in place to help conduct
the various pieces of analysis. Part of this was planning the logistics of finding transportation,
room, and board for each project member in a community that does not have regular services for
any of those needs. The other part was ensuring that each technical assistance provider had
sufficient access to the data, buildings, and local knowledge within the short trip.
For the most part, this was accomplished without issue. There was one instance, however, where
the residential auditor was unable to travel to the community with the rest of the group because
the only 8-seat flight of the day had filled up before he could purchase a ticket. As a result, the
residential audit had to be performed remotely using data from previous residential
weatherization.
This task also included the planning and execution of the community stakeholder meeting. The
meeting was an opportunity for the project manager to give a presentation on the RACEE
competition, introduce the technical assistance team, explain what work would be performed on
the site visit, meet community leaders and building owners, and collect any outstanding data.
The stakeholder meeting went well given the circumstances. Only a handful of residents
attended but this was not unexpected. DOE planned the RACEE project right in the middle of
summer – a time when most residents are either fishing or travelling. The presentation was
engaging and helpful for the project manager. Plenty of extra presentation materials were left for
the City to distribute to those who couldn’t attend.
Regional liaison site visit
DOE also paid for Laura Vaught, the Energy Coordinator at Southwest Alaska Municipal
Conference (SWAMC), to visit False Pass. SWAMC is an Alaska Regional Development
Organization (ARDOR) that is focused on developing economic opportunities for False Pass and
other Southwest Alaska communities. The original intent of the regional liaison’s visit was to
help facilitate local connections and regional support for the RACEE projects but Ms. Vaught
ended up doing a substantial amount of work in support of the task list.
Non-residential building inventory
The non-residential building inventory was an effort to compile a detailed accounting of all non-
residential buildings in the community along with information on their size, usage, age, and
ownership. The inventory was completed by Laura Vaught and informed many other analyses in
the scope of work – especially the energy use analysis. See Appendix C – Building Inventory.
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Energy audits of five public buildings
Coffman Engineers was contracted to conduct ASHRAE level 2 energy audits on the school,
clinic, public safety building, DOT warehouse, and water treatment building. Jennifer Parkhurst
inspected the mechanical systems, electrical systems, lighting, and building envelope of each.
Also, baseline energy consumption and building use patterns were collected from building
owners and maintainers. Energy Conservation Measures (ECM) identified during the site visit
were subsequently analyzed to determine estimated electricity and fuel oil savings. With these
savings and capital cost estimates, the simple payback was calculated for each ECM.
The non-residential audits identified 9 different ECM’s across 4 buildings with total energy
savings of up to 15,754 kWh and 8,653 gallons of diesel equivalent each year. No feasible
ECM’s were identified at the DOT warehouse. The ECM’s would cost a total of $104,345 to
implement with a simple payback of just 3 years. For more information, see Appendix D – Non-
residential Audit Report.
Energy audits of up to 30 residences
The scope of work originally included similar audits for the residences in False Pass. However,
as mentioned above, the auditor from Alaska Housing Finance Corporation (AHFC) was unable
to travel at the same time as the rest of the project team. Because of the unforgiving RACEE
timeline, the auditor was forced to take a different analytical approach.
Rather than physically inspect each home to identify ECM’s and estimate potential savings, Dale
Olney developed a statistical model to predict the capital cost required to achieve a certain
energy savings among all residences. The model was calibrated using actual expenditures to
weatherize four False Pass houses in 2013. This makes the findings arguably more accurate than
those resulting from audits because the model does not require any cost estimates. Nearly all
homes in False Pass were built by the regional housing authority and of very similar construction
so it is reasonable to expect similar potential costs and savings in the residences yet to be
retrofitted.
The residential model predicts that, among the 13 houses that have not been weatherized, a 15%
energy use reduction can be achieved with a capital cost of $110,078. The weatherization would
yield an estimated $9,882 in annual savings. This results in an 11.1 year payback for the project.
For more information, see Appendix E – Residential Energy Use Analysis.
School heat recovery feasibility analysis
The community’s current power plant was built in 2004 along with a waste heat recovery system
and heat loop to the adjacent city shop. The system appears to have enough waste heat to replace
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the load of an additional building. The False Pass School is the next closest building and
preferred choice.
The power plant, school, city shop loop, and a failed loop running from the old power plant to
the school were all inspected during the site visit. Data was collected on the school’s heating
load, the powerhouse gensets, and average electricity generation. The data was then entered into
AEA’s recoverable heat model.
It is estimated that waste heat from the power plant could displace 5,274 gallons of diesel
equivalent – nearly all of the school’s oil-fired heat. Implementation would cost approximately
$234,000 resulting in a 10.1 year payback. For more information, see Appendix F – School Heat
Recovery Feasibility.
Community energy use and tracking analysis
The energy use analysis is an aggregation of all ECM impacts compared to the community
baseline energy use to determine the ultimate impact of the RACEE project. The future load
growths and populations are projected to assess whether the goal of a 15% reduction in energy
use per capita will likely be met.
Financing options assessment
If the community of False Pass is not awarded the grant funding in Phase III, the community
should have a strategy in place to secure alternate funding. To help the different entities in the
community assess their ability to receive funding for a range of available public and private
financing sources, financial statements were requested from each. AEA then performed a
financial analysis to determine their creditworthiness and ability to self-finance the project.
Community-wide strategic energy efficiency plan
The final deliverable of Phase II is a comprehensive assessment of all data, opportunities, and
findings compiled through the technical assistance. This report will provide guidance on the best
course of action to complete the identified projects and meet the goal of a community-wide 15%
reduction. The plan and its appendices will also largely inform the community’s RACEE Phase
III application for implementation funding.
Energy Use Profile: 2010 Baseline vs. 2015 Use
To make any assertion of the community’s ability to reach the 15% energy reduction goal (2010-
2020), an accurate energy use baseline must first be established. This baseline is simply an
aggregation of all reported energy use data in the community. This data came from the Phase II
application, past analyses, the building inventory, site visit and audit findings, and AEA model
projections. The community of False Pass has had significant energy efficiency work
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implemented between the years 2010 and 2015. In order to develop an accurate 2010 baseline,
recent improvements often had to be subtracted from 2015 annual energy usage figures.
The False Pass energy model uses a baseline 2010 energy consumption of 9,962 MMBtu
community-wide. The figure is constituted of 494,949 kWh of electricity and 59,949 gallons of
heating fuel. At a 2010 population of 35, the 2010 energy use per capita is determined to have
been 285 MMBtu. This means that, holding population constant, the community must achieve a
43 MMBTU reduction to meet the RACEE goal of 242 MMBtu consumption per capita.
As stated before, much work has already been done towards this goal. The estimated 2015
energy consumption is 9,904 MMBtu or 225 MMBtu per capita. This is a 60 MMBtu per capita
reduction from 2010. By 2015, the community has already achieved a 21% reduction.
Generation/Consumption
(MMBtu)
Per Capita Consumption
(MMBtu/person)
Population Electricity
(kWh)
Heat
(DGE)
Total
(MMBtu)
Electricity
(kWh)
Heat
(DGE)
Total
(MMBtu)
2010 35 494,949 59,949 9,962 14,141 1,713 285
2015 44 672,014 55,151 9,904 15,273 1,253 225
However, this change is actually driven mostly by population change. Because False Pass has
such a small population, changes in the per capita energy usage are highly sensitive to population
changes. This is something to keep in mind when working towards the 2020 goal. Population
predictions are notoriously unreliable so it is important that the community remain committed to
the RACEE improvement whether the goal appears to have been met already or not.
Implementation Plan Description
While it is possible that the community could possibly reach their pledged 15% reduction goal
through efficiency work completed prior to the RACEE competition, the identified ECM’s
should be implemented all the same. Each measure was shown to have positive net benefits and
Phase III of RACEE is a unique opportunity to complete all of them simultaneously with a single
funding source.
The ECM’s should be implemented as soon as possible to begin realizing potential energy
savings. Every month the projects are delayed is another month that the energy savings cannot
be used for other purposes than purchasing unnecessary energy. Given the choice, the
community should start with the ECM’s that offer the fastest payback. Some ECM’s, such as
shutting down boilers and circulation pumps during the summer, do not have any associated cost.
These should be started before Phase III funding is even awarded.
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One exception to this rule is the school’s heat recovery analysis. It is important that any
weatherization to the school be completed before the heat loop design. This will ensure that
correctly-sized piping and pumps are installed so that the system can perform at peak efficiency.
Also, reduced diesel displacement after final design could severely affect the expected project
economics.
Stakeholder Engagement Plan
Even though most of the ECM’s involve city-owned buildings, it is important that all of the
entities continue to work towards the 2020 goal collaboratively. It is possible for the tribe or
corporation to assume responsibility over some of the project components. False Pass Tribe, for
instance, could oversee the residential weatherization considering that they worked with the
regional housing authority to complete cosmetic improvements to most of the residences in 2015.
Also, each of the entities has identified energy efficiency opportunities that were not included in
the final RACEE scope of work. Isanotski owns several non-residential buildings in the
community that could benefit from energy audits and, most likely, retrofits. False Pass Tribe
currently rents out cold storage space in their warehouse and is considering heating the entire
warehouse to be able to collect higher rents. They specifically asked for help in assessing
heating options and envelope improvements for the warehouse.
Bering Pacific Seafoods (BPS) probably constitutes the largest potential savings yet to be
realized. The processor is considering a few different projects to reduce their energy costs.
First, they want to add monitoring equipment to their powerhouse and the buildings it serves. At
the moment, they do not even have a good sense of how many kilowatt-hours they are generating
or what each building is using. Once they have collected a fair amount of data, they would like
to evaluate the whole system to determine what their energy costs are, whether self-generation is
actually cheaper than purchasing from the City, and what distribution upgrades would be
necessary to accept larger amounts of power from the City. At the same time, BPS is
considering upgrading many of their mechanical systems to integrate more energy-efficient
components. The plant was visited by an independent contractor, Daniel Phinny, who quoted
several upgrades for them. BPS wanted to incorporate the audit report into the RACEE analysis
but were not quite ready as this plan was being drafted. They have asked that the City consult
them about additional funding requests before submitting the Phase III application.
Estimated SEEP Impact
Appendix G – Energy Use Model provides the projection output for the model estimates of
energy use in 2020.
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Final Total Consumption
(MMBtu)
Final Per Capita Consumption
(MMBtu/person)
Population Electricity
(kWh)
Heat
(DGE)
Total
(MMBtu)
Electricity
(kWh)
Heat
(DGE)
Total
(MMBtu)
2020—without
RACEE
projects
35 550,000 55,319 9,511 15,714 1,581 272
2020—with
RACEE
projects
35 534,246 46,666 8,263 15,264 1,333 236
2010 to 2020
RACEE
Change
0% 8% -22% -17% 8% -22% -17%
According to the energy use model, the population of False Pass is expected to drop back down
to 35 by the year 2020. This make it much harder to reach the 15% energy use reduction per
capita goal. In order to meet the goal, the community must implement all RACEE identified
ECM’s. This will result in 236 MMBtu per capita consumption in 2020, which constitutes a
17% reduction. This leaves little room for error in the energy reduction.
Even with all RACEE projects implemented, the overall electricity usage is expected to rise by
8%. This rise is expected to be offset by a 22% reduction in heating oil overall.
The community may want to pursue some of the other available energy efficiency opportunities
outside of RACEE just to ensure that the goal is met.
SEEP Project Financing
If the community is not successful in receiving Phase III grant funding, they should seek
alternate funding sources to complete the project. Though state grants have become less prolific
in recent years, there are still many funding opportunities that can be applied to energy efficiency
projects.
Energy Financing Options Assessment
The City of False Pass provided 5 years of complete financial statements for the financial
analysis. AEA analyzed the financial information to assess the city’s ability to finance the
projects, either internally or via private or publics lenders.
The projects identified in False Pass have total efficiency project costs of about 440 thousand
dollars. The table below shows recommended project cost by the owner of the impacted facility,
as well as whether that owner is eligible for funding by DOE’s Office of Indian Energy. None of
the entities with projects analyzed through RACEE are eligible for OIE funding.
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Entity Project Costs OIE Eligible
City of False Pass $261,328 No
Aleutians East Borough School District $178,780 No
Total $440,108 $0
The City is responsible for the largest portion of the project costs. They are in an excellent
position to finance the entire $261,328 if need be. The City has very little debt, substantial
reserves, and an array of capital assets that could be collateralized. If the waste heat system is
financed, the City could also use the future funding stream to secure that credit.
The Aleutians East Borough School District did not provide financial information and, as such,
AEA cannot make any comment on their ability to fund the project components. However, the
school does have several options even if they are unable to fund the project internally.
While the False Pass Tribal Council and the Isanotski Corporation did not have projects
identified in the scope of RACEE, they could be included in the funding plan. Each entity has
access to unique funding sources that cannot be accessed by others.
For more information and a comprehensive list of known EE financing options, see Appendix H
– Financial Analysis.
The High Cost of Delay
It is important to remember that the identified potential savings should be seen as unnecessary
costs that will continue to burden the community until the efficiency measures are implemented.
There are surely better uses for this money in the community and the opportunity costs only
compound over time. Worse yet, if the Phase II analyses and recommendations are not utilized
soon enough, they will become outdated and of no use to the community. This would be a poor
waste of technical assistance that may never be available to False Pass again.
Next Steps
Tracking energy use is valuable to confirm that systems are working properly and upgrades are
having the intended effects. Tracking is also helpful more generally to see where use might be
increasing, suggesting something is wrong. Each entity in the community should assign an
employee to document electrical and fuel usage. There are tools available to help communities
with this tracking, including the Alaska Retrofit Information System (ARIS), a statewide
database of building energy use information maintained by AHFC.
ARIS is a crucial component to monitoring energy use all across Alaska. This system will play a
key role in future assessments in the community and will allow RACEE partners to help the
community reach their Phase I pledge of reducing energy consumption by 15%. In order to
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successfully utilize ARIS, the community will need to keep in regular contact with partner
agencies to ensure the data entered into ARIS is current. It is also important that the project leads
at partner agencies continue to engage the community stakeholders in ongoing monitoring and
evaluation to ensure that expected project benefits are realized.
In addition to monitoring energy use, it is necessary to identify maintenance and operational
needs to sustain the changes from implemented upgrades. These include but are not limited to
things like resetting setbacks after power outages, creating seasonal operations checklists,
maintaining data entry for energy use in ARIS or some other source, and others.
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Appendices
A: Phase I Pledge
B: Phase II Application
C: Building Inventory
D: Non-residential Audit Report
E: Residential Energy Use Analysis
F: School Heat Recovery Feasibility
G: Energy Use Model
H: Financial Analysis