HomeMy WebLinkAboutAEEC East Foreland - Nikiski Wind Round XIV REF Grant Application FINAL SIGNEDAlaska Electric & Energy Cooperative, Inc.
3977 Lake Street Homer, Alaska 99603 (907) 235-8551
Alaska Electric & Energy Cooperative, Inc. (907) 235-8551
January 17, 2022
AEA 15003 Renewable Energy Grant Application
Alaska Energy Authority
813 W. Northern Lights Blvd.
Anchorage, AK 99503
Dear Alaska Energy Authority:
RE: Renewable Energy Fund Round XIV Grant Application
Homer Electric Association, Inc. (HEA) through its generation subsidiary, Alaska Electric and
Energy Cooperative, Inc. (AEEC) appreciates the opportunity to present the enclosed Renewable
Energy Fund Round XIV Grant Application for feasibility studies and conceptual design for the
East Foreland Wind Project on the Kenai Peninsula.
This project is an important step towards Homer Electric Association’s and the State of Alaska’s
goals to reach 50% renewable energy and it has the potential to do so while reducing electrical
costs. This project will reduce the consumption of natural gas, thereby conserving Cook Inlet gas
supplies. Additionally, this wind project would help stabilize the long-term price of power to
consumers.
HEA/AEEC have invested considerable effort and resources in first pursuing greater efficiencies
in their gas-fired generators and most recently in siting the largest Battery Energy Storage
System (BESS) in the State to now be able to incorporate the type of cost-effective intermittent
renewable energy that this project would produce.
Thank you for this opportunity. Please feel free to contact me with questions at (907) 283-2375.
Sincerely,
Mikel Salzetti
Manager of Renewable Energy Development
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 1 of 34 11/16/2021
Application Forms and Instructions
This instruction page and the following grant application constitutes the Grant Application Form for
Round 14 of the Renewable Energy Fund (REF). A separate application form is available for
projects with a primary purpose of producing heat (see Request for Applications (RFA) Section
1.5). This is the standard form for all other projects, including projects that will produce heat and
electricity. An electronic version of the RFA and both application forms is available online at:
https://www.akenergyauthority.org/What-We-Do/Grants-Loans/Renewable-Energy-Fund/2021-
REF-Application.
What follows are some basic information and instructions for this application:
• The Alaska Energy Authority (AEA) expects this application to be used as part of a two-year
solicitation cycle with an opt-out provision in the second year of the cycle.
• If you are applying for grants for more than one project, provide separate application forms for
each project.
• Multiple phases (e.g. final design, construction) for the same project may be submitted as one
application.
• If you are applying for grant funding for more than one phase of a project, provide milestones
and grant budget for each phase of the project (see Sections 3.1 and 3.2.2).
• In order to ensure that grants provide sufficient benefit to the public, AEA may limit
recommendations for grants to preliminary development phases in accordance with 3 Alaska
Administrative Code (ACC) 107.605(1).
• If some work has already been completed on your project and you are requesting funding for
an advanced phase, submit information sufficient to demonstrate that the preceding phases are
completed and funding for an advanced phase is warranted. Supporting documentation may
include, but is not limited to, reports, conceptual or final designs, models, photos, maps, proof
of site control, utility agreements, business and operation plans, power sale agreements,
relevant data sets, and other materials. Please provide a list of supporting documents in
Section 11 of this application and attach the documents to your application.
• If you have additional information or reports you would like the Authority to consider in
reviewing your application, either provide an electronic version of the document with your
submission or reference a web link where it can be downloaded or reviewed. Please provide a
list of additional information; including any web links, in Section 12 of this application and attach
the documents to your application. For guidance on application best practices please refer to
the resource-specific Best Practices Checklists; links to the checklists can be found in the
appendices list at the end of the accompanying REF Round 14 RFA.
• In the Sections below, please enter responses in the spaces provided. You may add additional
rows or space to the form to provide sufficient space for the information, or attach additional
sheets if needed.
• If you need assistance with your application, please contact AEA’s Grants Coordinator by email
at grants@akenergyauthority.org or by phone at (907) 771-3081.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 2 of 34 11/16/2021
REMINDER:
• AEA is subject to the Public Records Act AS 40.25, and materials submitted to AEA may be
subject to disclosure requirements under the act if no statutory exemptions apply.
• All applications received will be posted on the Authority web site after final recommendations
are made to the legislature. Please submit resumes as separate PDFs if the applicant would
like those excluded from the web posting of this application.
• In accordance with 3 AAC 107.630 (b) Applicants may request trade secrets or proprietary
company data be kept confidential subject to review and approval by AEA. If you want
information to be kept confidential the applicant must:
o Request the information be kept confidential.
o Clearly identify the information that is the trade secret or proprietary in their application.
o Receive concurrence from the Authority that the information will be kept confidential. If
the Authority determines it is not confidential, it will be treated as a public record in
accordance with AS 40.25 or returned to the applicant upon request.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 3 of 34 11/16/2021
SECTION 1 – APPLICANT INFORMATION
Please specify the legal grantee that will own, operate, and maintain the project upon completion.
Name (Name of utility, IPP, local government, or other government entity)
Alaska Electric & Energy Cooperative, Inc.
Tax ID # 92-0177236
Date of last financial statement audit: December 31, 2020
Mailing Address: Physical Address:
3977 Lake Street, Homer, AK 99603 Same
Telephone: Fax: Email:
907-283-2375 msalzetti@homerelectric.com
1.1 Applicant Point of Contact / Grants Coordinator
Name: Mikel Salzetti Title: Manager of Renewable Energy
Development
Mailing Address:
3977 Lake Street, Homer, AK 99603
Telephone: Fax: Email:
907-283-2375 msalzetti@homerelectric.com
1.1.1 Applicant Signatory Authority Contact Information
Name: Bradley P. Janorschke Title: General Manager
Mailing Address: 3977 Lake Street, Homer, AK 99603
Telephone: Fax: Email:
907-283-2312 907-283-7122 bjanorschke@homerelectric.com
1.1.2 Applicant Alternate Points of Contact
Name Telephone: Fax: Email:
David Thomas 907-283-2364 dthomas@homerelectric.com
1.2 Applicant Minimum Requirements
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 4 of 34 11/16/2021
Please check as appropriate. If applicants do not meet the minimum requirements, the application
will be rejected.
1.2.1 Applicant Type
☒ An electric utility holding a certificate of public convenience and necessity under AS 42.05
CPCN #_640__, or
☐ An independent power producer in accordance with 3 AAC 107.695 (a) (1)
CPCN #______, or
☐ A local government, or
☐ A governmental entity (which includes tribal councils and housing authorities)
Additional minimum requirements
☒ 1.2.2 Attached to this application is formal approval and endorsement for the project by the
applicant’s board of directors, executive management, or other governing authority. If the
applicant is a collaborative grouping, a formal approval from each participant’s governing
authority is necessary. (Indicate yes by checking the box)
☒ 1.2.3 As an applicant, we have administrative and financial management systems and follow
procurement standards that comply with the standards set forth in the grant agreement
(Section 3 of the RFA). (Indicate yes by checking the box)
☒ 1.2.4 If awarded the grant, we can comply with all terms and conditions of the award as
identified in the Standard Grant Agreement template at
https://www.akenergyauthority.org/What-We-Do/Grants-Loans/Renewable-Energy-
Fund/2021-REF-Application (Any exceptions should be clearly noted and submitted with the
application.) (Indicate yes by checking the box)
☒ 1.2.5 We intend to own and operate any project that may be constructed with grant funds for
the benefit of the general public. If no please describe the nature of the project and who will
be the primary beneficiaries. (Indicate yes by checking the box)
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 5 of 34 11/16/2021
SECTION 2 – PROJECT SUMMARY
2.1 Project Title
Provide a 4 to 7 word title for your project. Type in the space below.
AEEC East Foreland / Nikiski Wind
2.2 Project Location
2.2.1 Location of Project – Latitude and longitude (preferred), street address, or
community name.
Latitude and longitude coordinates may be obtained from Google Maps by finding you project’s
location on the map and then right clicking with the mouse and selecting “What is here? The
coordinates will be displayed in the Google search window above the map in a format as follows:
61.195676.-149.898663. If you would like assistance obtaining this information, please contact
AEA’s Grants Coordinator by email at grants@akenergyauthority.org or by phone at (907) 771-
3081.
Latitude 60.69353 Longitude -151.38543
The proposed project will study the feasibility of locating a wind energy generation facility
consisting of 9-turbiness (30 MW) in the East Foreland / Nikiski Industrial Area, in Nikiski, Alaska
near the refinery and the fertilizer plant. The turbines will be dispersed throughout the site based
upon available resource and applicable exclusions.
2.2.2 Community benefiting – Name(s) of the community or communities that will be the
beneficiaries of the project.
The member-owners of Homer Electric Association will benefit from these grant funds. Homer
Electric’s certificated territory encompasses a vast majority of the population and communities on
the Kenai Peninsula and essentially all of populated portions of the central and western Kenai
Peninsula including the incorporated cities of Kenai, Soldotna, and Homer and the
villages/communities of Nikiski, Salamatof, Sterling, Kasilof, Clam Gulch, Ninilchik, Anchor Point,
Kachemak City, Halibut Cove, Seldovia, Port Graham and Nanwalek.
2.3 Project Type
Please check as appropriate.
2.3.1 Renewable Resource Type
☒ Wind ☐ Biomass or Biofuels (excluding heat-only)
☐ Hydro, Including Run of River ☐ Hydrokinetic
☐ Geothermal, Excluding Heat Pumps ☐ Transmission of Renewable Energy
☐ Solar Photovoltaic ☐ Storage of Renewable
☐ Other (Describe) ☐ Small Natural Gas
2.3.2 Proposed Grant Funded Phase(s) for this Request (Check all that apply)
Pre-Construction Construction
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 6 of 34 11/16/2021
☐ Reconnaissance ☐ Final Design and Permitting
☒ Feasibility and Conceptual Design ☐ Construction
2.4 Project Description
Provide a brief, one-paragraph description of the proposed project.
Homer Electric Association, Inc. (HEA) through its generation subsidiary Alaska Electric & Energy
Cooperative, Inc. (AEEC) plans to construct a 30-MW wind energy generation facility located on
the Kenai peninsula. The project will consist of 9 wind turbines disbursed throughout the site and
electrically interconnected to the HEA transmission system. In addition to turbines, the project will
need to construct turbine access roads and crane pads, plus connect the turbines through an
electrical collector system. The proposed project will study the feasibility of locating the wind
energy generation facility in the East Foreland / Nikiski Industrial Area, in Nikiski, Alaska.
2.5 Scope of Work
Provide a short narrative for the scope of work detailing the tasks to be performed under this
funding request. This should include work paid for by grant funds and matching funds or performed
as in-kind match.
This funding request is for the Feasibility Analysis phase. HEA has already initiated
Reconnaissance phase analysis to identify the sites with the highest probability of success. This
grant request is to determine the feasibility of the project and develop a conceptual design. Scope
will include:
1. Project scoping and contractor solicitation
a. HEA has performed screening-level desktop project scoping and initial contractor
solicitation for several tasks. HEA will refine the full scope of work for the project
and will solicit, screen and hire contractors to complete the remaining development
tasks.
b. A development schedule will be developed to incorporate all the necessary permit,
milestones, spending, and time allocations.
2. Detailed resource assessment
a. HEA has a draft resource assessment plan that includes the preliminary locations
and numbers for meteorological towers and remote sensing devices to measure the
wind resource at the proposed project location. This plan will be finalized and
executed as part of the grant scope.
b. A site visit will be conducted to determine the most appropriate locations from which
to gather meteorological data.
c. HEA will purchase or rent and install necessary meteorological equipment.
d. Wind data will be monitored and QC’d.
e. HEA will commission a wind resource assessment and project layout design effort
after on-site met data has been collected.
3. Identification of land and regulatory issues
a. HEA will engage with additional landowners to secure necessary land.
b. HEA will engage with federal, state and local authorities, as needed, to determine
regulatory issues the project may face.
4. Permitting and environmental analysis
a. An initial permitting matrix has been developed and will be refined during this
period.
b. HEA’s desk-top screening has already avoided National and State Parks,
Wilderness area and minimized impact to federal and state protected species,
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 7 of 34 11/16/2021
waters of concern, wetlands, and other protected areas. Additional desktop
screening will be done during the scope and solicitations will be prepared for
necessary environmental analysis.
5. Detailed analysis of current cost of energy and future market
a. HEA will conduct an analysis of current and future costs of energy.
b. This information will be combined with the cost projections for this project to
determine if the project, as proposed, is feasible.
6. Assessment of alternatives
a. HEA will balance this proposed project vs. alternatives to determine whether
pursuing this project is in the best interest of HEA members and the people of the
State of Alaska.
b. Assuming this project is competitive with alternatives, a recommendation to move
into the next phase will be delivered.
7. Conceptual design and costs estimate
a. Based on the site visits and the other analysis, the design of the project will be
refined to include:
i. Turbine locations,
ii. Access roads, and
iii. Collector and electrical systems.
b. These designs will then be used to determine site-specific project costs.
8. Detailed economic and financial analyses
a. Based on the overall system cost, coupled with the energy production estimates,
the overall cost of energy will be calculated. HEA intends to be the primary
consumer of the energy produced by this facility, but analysis will be done to
determine if other markets exist for this power.
b. HEA has invested in developing and training staff in a financial model for renewable
energy projects. Once costs and revenues are better refined as part of this grant,
HEA will use this model to develop high, low and base cases for the financial
returns of the project.
9. Conceptual business & operations plan
a. Based on the information gathered in the steps above, HEA will develop an
operations plan for the long-term success of the project.
b. HEA will develop a business case for proceeding with, modifying or terminating this
project.
10. Final report and recommendations
a. Based on projected returns, potential risks and project timeline, HEA will evaluate
whether this site is recommended for further advancement toward final design and
permitting.
b. Report will include a plan for project next steps.
2.6 Previous REF Applications for the Project
See Section 1.15 of the RFA for the maximum per project cumulative grant award amount
Round
Submitted
Title of application Application
#, if known
Did you
receive a
grant? Y/N
Amount of REF
grant awarded
($)
NA
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 8 of 34 11/16/2021
SECTION 3 – Project Management, Development, and Operation
3.1 Schedule and Milestones
Please fill out the schedule below (or attach a similar sheet) for the work covered by this funding
request. Be sure to identify key tasks and decision points, including go/no go decisions, in your
project along with estimated start and end dates for each of the milestones and tasks. Please
clearly identify the beginning and ending of all phases (I. Reconnaissance, II. Feasibility and
Conceptual Design, III. Final Design and Permitting, and IV. Construction) of your proposed
project. See the RFA, Sections 2.3-2.6 for the recommended milestones for each phase. Add
additional rows as needed.
Task
# Milestones Tasks
Start
Date
End
Date Deliverables
1 Cost Estimating Develop a Preliminary
construction and
component delivery
cost forecast 7/22 9/22
Preliminary construction and
component delivery cost
forecast
2 Financial Analysis Develop a detailed
project economic
feasibility report 10/22 5/23
Detailed project economic
feasibility report
3 Resource
Assessment
Install Meteoritical
Monitoring Equipment 8/22 7/23
Raw Meteoritical Data
4 Resource
Assessment
Monitor, Process &
QC Met Data 8/22 7/23
Processed Meteoritical Data
5 Resource
Assessment
Develop Energy
Forecast 8/23 11/23
Energy Forecast
6 Conceptual Design Develop a conceptual
turbine array design
and civil layout 9/22 12/22
A conceptual turbine array
design and civil layout
3.2 Budget
3.2.1 Funding Sources
Indicate the funding sources for the phase(s) of the project applied for in this funding request.
Grant funds requested in this application $200,000
Cash match to be provideda $50,000
In-kind match to be provideda $
Energy efficiency match providedb $
Total costs for project phase(s) covered in application (sum of
above)
$250,000
Describe your financial commitment to the project and the source(s) of match. Indicate whether
these matching funds are secured or pending future approvals. Describe the impact, if any, that
the timing of additional funds would have on the ability to proceed with the grant.
HEA’s generation subsidiary’s (AEEC’s) Board of Directors, has passed Resolution 01.2022.02,
“Grant Funding Authorization for East Foreland Wind Project” which is attached. Also attached is
a certification by the AEEC General Manager, Bradley P. Janorschke, that the Cooperative will
honor the match amounts and is in a financial condition to do so.
Both documents are included as Attachment C.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 9 of 34 11/16/2021
a Attach documentation for proof (see Section 1.18 of the Request for Applications)
b See Section 8.2 of this application and Section 1.18 of the RFA for requirements for Energy Efficiency
Match.
3.2.2 Cost Overruns
Describe the plan to cover potential cost increases or shortfalls in funding.
HEA/AEEC would cover any cost overruns required to complete this stage of feasibility analysis.
3.2.3 Total Project Costs
Indicate the anticipated total cost by phase of the project (including all funding sources). Use actual
costs for completed phases. Indicate if the costs were actual or estimated.
Reconnaissance [Actual/Estimated] $12,500
Feasibility and Conceptual Design [Actual/Estimated] $250,000
Final Design and Permitting [Actual/Estimated] $2,110,000
Construction [Actual/Estimated] $78,000,000
Total Project Costs (sum of above) Estimated $80,372,500
Metering/Tracking Equipment [not included in project
cost]
Estimated $
3.2.4 Funding Subsequent Phases
If subsequent phases are required beyond the phases being applied for in this application,
describe the anticipated sources of funding and the likelihood of receipt of those funds.
• State and/or federal grants
• Loans, bonds, or other financing options
• Additional incentives (i.e. tax credits)
• Additional revenue streams (i.e. green tag sales or other renewable energy subsidies or
programs that might be available)
As for all large projects, HEA/AEEC would examine current interest rates and loan terms from its
two primary lenders National Rural Utilities Cooperative Finance Corporation (CFC) – a not-for-
profit lender set up by its member electrical utilities and the USDA Rural Utilities Service (RUS).
Any applicable state or federal grants would be applied for and the possibility of bringing in a tax-
equity partner to access federal Investment Tax Credits (ITCs) or Production Tax Credits (PTCs)
would be considered once meteorological data and refined construction cost estimates allow for
more accurate cost of plant and cost of energy to be calculated.
HEA has been and will continue to track (and advocate for) a direct-pay provision for ITCs and
PTCs to be distributed directly to cooperatives and government entities currently contained in the
pending BBB federal infrastructure bill.
Renewable Energy Certificates would be obtained for all energy eventually put onto the grid (as
CEA already does with Fire Island wind energy) and monetized, although that has historically
yielded less than $1/MWh. Should a mandatory Renewable Portfolio Standard (RPS) be enacted
in Alaska, HEA would diligently monetize any excess RECs (beyond HEA’s own statutory
requirements) for resale to other utilities at rates of potentially $10-20/MWh which is a significant
portion of the energy cost.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 10 of 34 11/16/2021
3.2.3 Budget Forms
Applications MUST include a separate worksheet for each project phase that was identified in
Section 2.3.2 of this application — I. Reconnaissance, II. Feasibility and Conceptual Design, III.
Final Design and Permitting, and IV. Construction. Please use the tables provided below to detail
your proposed project’s total budget. Be sure to use one table for each phase of your project, and
delete any unnecessary tables. The milestones and tasks should match those listed in 3.1 above.
If you have any question regarding how to prepare these tables or if you need assistance preparing
the application please feel free to contact AEA’s Grants Coordinator by email at
grants@akenergyauthority.org or by phone at (907) 771-3081.
Phase 2 — Feasibility and Conceptual Design
Milestone or Task
Anticipated
Completion
Date
RE- Fund
Grant Funds
Grantee
Matching
Funds
Source of
Matching
Funds:
Cash/In-
kind/Federal
Grants/Other
State
Grants/Other
TOTALS
(List milestones based on
phase and type of project.
See Sections 2.3 thru 2.6 of
the RFA )
$ $ $
Cost Estimating 9/22 $28,000 $7,000 $35,000
Financial Analysis 5/23 $24,000 $6,000 $30,000
Resource Assessment 11/23 $128,000 $32,000 $160,000
Conceptual Design 12/22 $20,000 $5,000 $25,000
TOTALS $200,000 $50,000 $250,000
Budget Categories:
Direct Labor & Benefits $ $ $
Travel & Per Diem $ $ $
Equipment $ $ $
Materials & Supplies $ $ $
Contractual Services $200,000 $50,000 $250,000
Construction Services $ $ $
Other $ $ $
TOTALS $200,000 $50,000 $250,000
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 11 of 34 11/16/2021
3.2.4 Cost Justification
Indicate the source(s) of the cost estimates used for the project budget, including costs for future
phases not included in this application.
The cost estimates are based on a detailed desktop review of the proposed project footprint
including analysis of construction and component delivery constraints. The cost estimates also
incorporate recent experience on other similarly situated wind projects, as well as the development
team’s extensive experience in US wind development and knowledge of prudent industry practice.
3.3 Project Communications
3.3.1 Project Progress Reporting
Describe how you plan to monitor the progress of the project and keep AEA informed of the status.
Who will be responsible for tracking the progress? What tools and methods will be used to track
progress?
The Project Manager will conduct regularly scheduled meetings with the contractors providing the
feasibility analysis for this Project to track progress, schedule and budget.
Project management and financial control will issue reports to AEA on a mutually agreeable
schedule throughout the life of the grant. These reports can be customized to meet AEA needs.
3.3.2 Financial Reporting
Describe the controls that will be utilized to ensure that only costs that are reasonable, ordinary
and necessary will be allocated to this project. Also discuss the controls in place that will ensure
that no expenses for overhead, or any other unallowable costs will be requested for reimbursement
from the REF Grant Program.
HEA has a dedicated financial controller. Ms. Clymer, HEA’s Controller has acted as financial
control for several other AEA awarded grants. HEA uses Southeastern Data Corporation (SEDC)
for our financial services software to assist with accounting and financial control systems. Every
year, HEA’s and AEEC’s financial statements and accounting procedures are audited by an
outside firm (which in recent years has been BDO USA, Inc).
SECTION 4 – QUALIFICATIONS AND EXPERIENCE
4.1 Project Team
Include resumes for known key personnel and contractors, including all functions below, as an
attachment to your application. In the electronic submittal, please submit resumes as separate
PDFs if the applicant would like those excluded from the web posting of this application.
4.1.1 Project Manager
Indicate who will be managing the project for the Grantee and include contact information. If the
applicant does not have a project manager indicate how you intend to solicit project management
support. If the applicant expects project management assistance from AEA or another government
entity, state that in this section.
HEA’s Manager of Renewable Energy Development, Mike Salzetti, will be the Project Manager for
this Project. He has 31 years of engineering experience with 21 of those years including Project
Management responsibilities.
Mr. Salzetti’s contact information in shown in Section 1.1 of this application and his professional
qualifications are included in Attachment A.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 12 of 34 11/16/2021
4.1.2 Project Accountant
Indicate who will be performing the accounting of this project for the grantee. If the applicant does
not have a project accountant indicate how you intend to solicit financial accounting support.
Katheryn Parke, HEA’s Plant Accounting Supervisor will be performing the accounting for this
Project.
4.1.3 Expertise and Resources
Describe the project team including the applicant, partners, and contractors.
For each member of the project team, indicate:
• the milestones/tasks in 3.1 they will be responsible for;
• the knowledge, skills, and experience that will be used to successfully deliver the tasks;
• how time and other resource conflicts will be managed to successfully complete the task.
If contractors have not been selected to complete the work, provide reviewers with sufficient detail
to understand the applicant’s capacity to successfully select contractors and manage complex
contracts.
HEA’s Manager of Renewable Energy Development, Mike Salzetti, will be the Project Manager for
this Project. Mike has over 31 years of engineering experience with 21 of those years including
Project Management responsibilities. Mr. Salzetti played an integral role in the design of Homer
Electric’s new generation facilities and successfully shepherded the Grant Lake Hydroelectric
Project through an original FERC licensing process.
Mr. Salzetti has the guidance, support, staffing, and resources of Homer Electric Association to
support him in all phases of this project. The professional biographies of HEA’s Executive
Management Team are included as part of Attachment A to this application.
HEA has partnered with ReGenerate Consulting and Pivot Power Management for this project.
ReGenerate Consulting is a technical consulting firm exclusively focused on renewable energy.
Every member of ReGenerate’s staff on this project has a minimum of 17 years developing wind
projects. ReGenerate staff have worked on more than 100 wind projects in more than 25
countries. In the past 10 years, ReGenerate has helped clients build more than 10,000 MW of
wind projects. Pivot Power Management is an independent developer of utility scale wind and
solar projects with a specialty in commercial transactions and project finance. The Pivot Power
management team has participated in the development of over 5,000 MW of wind projects and has
raised over $3bn of project finance. Resumés for ReGenerate and Pivot Power’s staff are included
as part of Attachment A to this application.
4.2 Local Workforce
Describe how the project will use local labor or train a local labor workforce.
HEA Management Directives governing contracting and procurement include considerations for
such things as material procurement from pre-qualified businesses operating on the Kenai
Peninsula, possession of an Alaska Business license, maintenance of an office and staff within
Alaska and advertisements in general circulation publications as defined by Alaska State Statutes
that promote local contracting and procurement.
Pursuit to Board Policy 401 – Contracting and Purchasing, Section II, part H, HEA and AEEC give
a 5% preference to vendors maintaining an office or place of business in the cooperative’s service
area (unless prohibited by statute, regulation or grant).
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 13 of 34 11/16/2021
SECTION 5 – TECHNICAL FEASIBILITY
5.1 Resource Availability
5.1.1 Assessment of Proposed Energy Resource
Describe the potential extent/amount of the energy resource that is available, including average
resource availability on an annual basis. For pre-construction applications, describe the resource to
the extent known. For design and permitting or construction projects, please provide feasibility
documents, design documents, and permitting documents (if applicable) as attachments to this
application (See Section 11). Likelihood of the resource being available over the life of the project.
See the “Resource Assessment” section of the appropriate Best Practice Checklist for additional
guidance.
The project is a 9-turbine (30 MW) wind energy generation facility located in the Nikiski Industrial
Area, in Nikiski, on the Kenai peninsula. The turbines will be disbursed throughout the site based
upon available resource and applicable exclusions.
A preliminary design and energy analysis was completed based on 200m resolution mesoscale
modeled wind data showing an expected average wind speed of 7.1 m/s at a 120m hub height.
Based upon site conditions and available technology, a review of mid-sized turbines from top-tier
manufacturers (Vestas, GE, Siemens Gamesa Renewable Energy) showed multiple potential
turbines with similar production. Ultimately, the GE 3.4-140 h117 turbine was utilized for planning
purposes. This turbine is considered representative of the current state of the art in the wind
industry and yields an expected net capacity factor of 35.8% at this site. The wind rose shows
prevailing winds from the north-northeast. Further on-site data collection is required to both
validate and refine these expectations.
Prior to final design, the project will commission a detailed analysis of the wind resource using on-
site met data, wind flow modeling and energy production estimates from a qualified wind resource
consultant. A site visit will be conducted by the consultant to confirm optimal location of turbines
and coordination with turbine manufacturers to confirm turbine suitability.
5.1.2 Alternatives to Proposed Energy Resource
Describe the pros and cons of your proposed energy resource vs. other alternatives that may be
available for the market to be served by your project.
Homer Electric Association’s Board of Directors has developed a Board Policy (505 - Renewable
Portfolio Goal) that states, “It is the policy of the Cooperative to use best efforts to meet a
renewable portfolio goal of 50% of its annual energy needs by the end of 2025.” HEA staff is in the
process of analyzing and developing a suite of firm and non-firm renewable energy projects to
meet this goal. It is anticipated that a mix of renewable energy projects will be needed to cost
effectively achieve this goal.
AEEC / East Foreland Wind Project Pros:
1. It is forecast to provide a good (35.8%) capacity factor at one of the most accessible and
industrial settings in Alaska.
2. Due to reduced access costs, small, medium and large projects are all economically
feasible and project size can be adjusted to fit AEEC’s ability to integrate the resource and/or
install the project in phases.
3. Wind at all sites modelled by HEA, including this one, has higher energy production in
winter months which matches HEA’s seasonal load profile.
4. It is anticipated that the cost of energy will be lower than the cost of avoided gas
consumption, even with integration costs.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 14 of 34 11/16/2021
5. AEEC already possess a BESS of sufficient capacity to integrate this non-firm resource.
6. As a not-for-profit entity, HEA has the following advantages over an IPP executing a similar
project:
a. No profit margin required
b. Access to lower financing rates
c. No property taxes
d. Access to an existing work force and remote dispatch system
This project is beneficial for HEA owner-member, citizens of the Kenai Peninsula Borough and the
environment.
AEEC / East Foreland Wind Project Cons:
1. Wind is intermittent and while HEA possesses an adequately sized BESS, the use of the
BESS is not free. The round-trip efficiency of the BESS ranges from 85% if cycled fully to 93% if
kept in a tighter range. Any use of a BESS consumes energy that must be replaced in the hours
ahead – ideally when generation assets have excess, economic energy available, but will not
always be the case.
2. As a not-for-profit entity, HEA does not currently qualify for tax credits, although there is
proposed Federal legislation that would provide direct incentives to nonprofit entities in lieu of tax
credits. Preliminary financial modeling suggests HEA’s lower cost of capital is a more significant
factor than monetizing tax credits through a tax-equity partner, but privately financed projects are
currently assuredly of ITCs or PTCs.
3. AEECs generation assets will be more complicated to operate, maintain and dispatch with
the addition of new, non-firm projects. For instance, AEEC’s gas deliveries must be “nominated” in
6-hour blocks, 24 hours in advance which will require forecasting how wind occurs throughout the
next day – something that adds uncertainty to the process and potential costs if penalties are
assessed for deviating from one’s nominated quantities.
5.1.3 Permits
Provide the following information as it may relate to permitting and how you intend to address
outstanding permit issues. See the “Environmental and Permitting Risks” section of the appropriate
Best Practice Checklist for additional guidance.
• List of applicable permits
• Anticipated permitting timeline
• Identify and describe potential barriers including potential permit timing issues, public
opposition that may result in difficulty obtaining permits, and other permitting barriers
Permit Name Permit Trigger
NEPA Environmental Review Federal funds or lands
Local Floodplain Permit Flood hazard zone
Alaska Regional Condition J Impacts to waters
Construction General Permit for Stormwater
(AK)
Projects that disturb greater than or
equal to 1 acre of land
Nationwide Permit 51 Land-Based Renewable
Energy Generation Facilities
Impacts to waters of the U.S.
Bald and Golden Eagle Take Permit Effects to eagles
Incidental Take Permit for protected species Presence of protected species
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 15 of 34 11/16/2021
The project expects to initiate its environmental permitting and monitoring program in the spring of
2023 with the permitting effort expected to continue throughout 2025.
5.2 Project Site
Describe the availability of the site and its suitability for the proposed energy system. Identify
potential land ownership issues, including whether site owners have agreed to the project or how
you intend to approach land ownership and access issues. See the “Site control” section of the
appropriate Best Practice Checklist for additional guidance.
This location is well suited for wind development with better wind resource when compared to a
majority of the western peninsula, minimal residential areas within the immediate vicinity and close
proximity to road access, transmission and two existing substations. HEA commissioned a detailed
site selection effort that compared the revenue vs. cost of the entire Kenai peninsula and this site
was chosen as one of the top sites.
The site was previously considered for a wind project by Kenai Winds, LLC, an Apex Wind company,
which ultimately did not move forward, however with upgrades in turbine technology over this time
it’s reasonable to deliver a higher capacity project utilizing the same project area while also
increasing efficiency and project returns. The cost of capital is fundamental to the economics of any
project and HEA/AEEC lost-cost funding sources result in lower energy costs than for-profit
corporations are willing to offer. Further, HEA now owns and operates the largest Battery Energy
Storage System in Alaska, which was acquired, in part, to more economically and reliably integrate
non-firm renewable energy resources without combustion turbines incurring greater fuel usage and
maintenance costs if used to “follow” a large non-firm energy source.
The layout is preliminary and is based upon available resource, parcels information and exclusions
considered as part of the prospecting effort to identify new sites. Exclusions considered include:
roads, railroads, airports, existing power plants, designated wilderness areas, designated refugee
areas, state parks, national parks, military, high population areas, legislatively designated areas,
wildlife refuges, transmission lines and wetlands.
Landowners are being engaged for the potential of locating wind turbines and/or BOP facilities on
their parcels. While the installed capacity of the project may not necessarily increase based on
available land, access to the other lands allows flexibility in the final siting determination. This allows
the project to most effectively maximize power output and reduce overall cost of energy. The primary
landowner in the area of interest is Marathon and its subsidiary Kenai Pipeline Company. The other
large landowners are: Agrium (Now Nutrien), Chevron and the Kenai Peninsula Borough (KPB).
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 16 of 34 11/16/2021
5.3 Project Technical & Environmental Risk
5.3.1 Technical Risk
Describe potential technical risks and how you would address them.
• Which tasks are expected to be most challenging?
• How will the project team reduce the risk of these tasks?
• What internal controls will be put in place to limit and deal with technical risks?
See the “Common Planning Risks” section of the appropriate Best Practice Checklist for additional
guidance.
HEA has undertaken a rigorous site-prospecting effort to identify this site as one of the most
promising within their target area. This evaluation included developing and consolidating dozens
of GIS layers that included wetlands, historical sites, land cover, wind production, and existing
infrastructure. Sites were analyzed both for high return on investment (wind energy revenue less
project execution costs) and risks were considered when selecting sites. This thorough process
produces sites with lower overall risk.
The largest risk to any wind project is that the project resource is overestimated due to lack of
onsite wind measurements. This risk will be mitigated by a rigorous onsite measurement campaign
and validation of the energy assumptions.
The next largest risk to the project is equipment supply risk caused by the remote location of the
project, limited construction season and the size of turbine components. This is mitigated by
careful supply chain and transportation planning. In conjunction with expert consultants, HEA will
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 17 of 34 11/16/2021
analyze both these aspects in detail and determine whether it is worth stocking parts locally or
securing guarantees from suppliers about timing and delivery options.
HEA will only use proven, reliable wind turbines from leading manufactures and the best
operations staff. This is further required by our lenders.
As part of the overall project execution plan, HEA will include contingency planning for critical
milestones throughout the design and construction phases of the project. At this time, we do not
foresee problems or risks that would cause project delays, other than unpredictable delays in
delivery of equipment required for the construction of the wind project. Project partners,
ReGenerate Consulting and PivotPower, have a proven track record of developing and operating
wind projects utilizing similar turbines and infrastructure.
At this time, we do not anticipate significant opposition to the project, considering public advocacy
in favor of renewable resources voiced at several HEA Board meetings and during public forums.
The current project cost estimate has an uncertainty of +/- 20 percent that adds a risk of cost over-
runs that will not be covered by grant money. To mitigate this risk HEA is committed to covering
costs above those estimated in this proposal. The risks associated with negotiations include the
inability to successfully negotiate a land use agreement, however this risk is mitigated by the
multiple suitable turbine sites with numerous land owners with whom land use negotiations can be
conducted. To mitigate these risks, the prospective turbine sites include abundant private,
corporate, native-corporation and Borough land. Given that diversity of siting locations, permitting
the wind turbine construction is not a likely barrier.
5.3.2 Environmental Risk
Explain whether the following environmental and land use issues apply, and if so which project
team members will be involved and how the issues will be addressed. See the “Environmental and
Permitting Risks” section of the appropriate Best Practice Checklist for additional guidance.
• Threatened or endangered species
• Habitat issues
• Wetlands and other protected areas
• Archaeological and historical resources
• Land development constraints
• Telecommunications interference
• Aviation considerations
• Visual, aesthetics impacts
• Identify and describe other potential barriers
Species Name Scientific Name Status Presence
Eskimo Curlew Numenius borealis Endangered May Occur
Short-Tailed Albatross Phoebastria albatrus Endangered May Occur
Steller Sea Lion Eumetopias jubatus Endangered May Occur
Beluga Whale Delphinapterus leucas Endangered May Occur
Green Sturgeon Acipenser medirostris Threatened May Occur
Steller's Eider Polysticta stelleri Threatened Not Likely to Occur
Habitat issues
The species identified above may occur within or around the project footprint.
Wetlands and other protected areas
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 18 of 34 11/16/2021
Archaeological and historical resources
The project site is a brownfield location with no documented archaeological and historical
resources in the project footprint.
Land development constraints
The site footprint includes active industrial activity, and the project would be sited in collaboration
with those parties.
Telecommunications interference
No telecommunication interference analysis has been conducted to-date.
Aviation considerations
No aviation analysis has been conducted recently, but an FAA “Determination of no hazard to air
navigation” letter was issued for this location in 2009.
Visual, aesthetics impacts
No visual or aesthetic analysis has been conducted to-date, but the site is one of the most
obviously industrial coastal areas on the Kenai peninsula.
Identify and describe other potential barriers
The brownfield nature of the project site will result in lower barriers to development success.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 19 of 34 11/16/2021
5.4 Technical Feasibility of Proposed Energy System
In this section you will describe and give details of the existing and proposed systems. The
information for existing system will be used as the baseline the proposal is compared to and also
used to make sure that proposed system can be integrated.
Only complete sections applicable to your proposal. If your proposal only generates electricity, you
can remove the sections for thermal (heat) generation.
5.4.1 Basic Operation of Existing Energy System
Describe the basic operation of the existing energy system including: description of control system;
spinning reserve needs and variability in generation (any high loads brought on quickly); and
current voltage, frequency, and outage issues across system. See the “Understanding the Existing
System” section of the appropriate Best Practice Checklist for additional guidance.
AEEC owns and operates three plants that are fueled by natural gas. The Nikiski Plant is an 80
MW baseload generating plant fueled by natural gas and recovered heat. HEA has two backup
generating plants: the Soldotna Plant, a 48 MW generating plant; and the Bernice Lake Plant, a 73
MW generating plant that are used for backup, peaking, and reserve capacity. Additionally, AEEC
has access to 14 MW of purchased power capacity at the State’s Bradley Lake Hydroelectric
facility.
5.4.2.1 Existing Power Generation Units
Include for each unit include: resource/fuel, make/model, design capacity (kW), minimum
operational load (kW), RPM, electronic/mechanical fuel injection, make/model of genset
controllers, hours on genset
Unit 1: Nikiski Combined Cycle Plant: Natural Gas/ Steam, CT GE Frame 6B Combustion
Turbine, 40-MW ST GE SC2-22, HRSG Deltak Dino 4128 Heat Recovery Steam Generator, 40-
MW , NCC design capacity 80 MW, NCC minimum operational load 20 MW, CT RPM 5105, ST
RPM 3600, Emerson Ovation DCS
Unit 2: Soldotna Combustion Turbine Plant: Natural Gas, GE LM6000 Combustion Turbine
Generator, design capacity 48 MW, minimum operational load 3 MW, RPM 3600, Emerson
Ovation DCS
Unit 3: Bernice Lake Combustion Turbine Plant: Natural Gas, GE Frame 5 Combustion Turbine,
design capacity 19 MW, design capacity 27 MW, design capacity 27 MW, minimum operational
load 3 MW, minimum operational load 6 MW, minimum operational load 6 MW, RPM 3600,
Emerson Ovation DCS
Unit 4: Bradley Lake Hydroelectric Project (Hydro), Fuji generators, Andritz hydro runners,
design capacity 64 MW per unit (HEA 14 MW share), no minimum operational load, RPM 300,
Emerson Ovation DCS
Unit 5:
Unit 6:
5.4.2 Existing Energy Generation Infrastructure and Production
In the following tables, only fill in areas below applicable to your project. You can remove extra
tables. If you have the data below in other formats, you can attach them to the application (see
Section 11).
Is there operational heat recovery? (Y/N) If yes estimated
annual displaced heating fuel (gallons)
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 20 of 34 11/16/2021
5.4.2.2 Existing Distribution System
Describe the basic elements of the distribution system. Include the capacity of the step-up
transformer at the powerhouse, the distribution voltage(s) across the community, any transmission
voltages, and other elements that will be affected by the proposed project.
The HEA system has a total of 2,491 miles of energized line that distributes power to 35,599 meters
in a 3,166 square-mile service area on the Kenai Peninsula.
At 30 MW, it is likely that this project will need to tie into the transmission system at transmission
voltages not distribution lines and voltages. One of the advantages of this proposed site is its
proximity to both the Nikiski Plant Substation and the Bernice Lake Substation both with access to a
ringed transmission system. As part of the Construction and Final Design stage of the Project, a
complete Interconnection Impact Study will be completed.
5.4.2.3 Existing Thermal Generation Units (if applicable to your project)
Generation
unit
Resource/
Fuel type
Design
capacity
(MMBtu/hr)
Make Model Average
annual
efficiency
Year
Installed
Hours
Nikiski
Combined
Cycle Plant
Natural
Gas/
Steam
CT 40 MW,
ST 40 MW
CT
GE,ST
GE,
HRSG
Deltak
CT Frame
6B
Combustion
Turbine, ST
SC2-22,
HRSG Dino
4128 Heat
Recovery
Steam
Generator
CT 35-
42%,
NCC
60%
CT
1986,
HRSG
2001,
ST 2014
CT
168,983
hours (as
of EOY
2019)
Soldotna
Combustion
Turbine
Plant
Natural
Gas
CT 48 MW CT GE CT LM6000
Combustion
Turbine
Generator
Peak CT
2014
CT
13,326
hours (as
of EOY
2019)
Bernice
Lake
Combustion
Turbine
Plant
Natural
Gas
Soldotna
Combustion
Turbine
Plant
CT GE CT Frame 5
Combustion
Turbine
Peak CT
1971,
CT
1978,
CT
1981
5.4.2.4 O&M and replacement costs for
existing units
Power Generation Thermal Generation
i. Annual O&M cost for labor AEEC does not track labor
& non-labor separately so
O&M cost are below. This
excludes natural gas costs.
ii. Annual O&M cost $7,975,397
iii. Replacement schedule and cost for
existing units
NCC retirement 2043,
SCT retirement 2054,
BCT retirement 2034
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 21 of 34 11/16/2021
5.4.2.5 Annual Electricity Production and Fuel Consumption (Existing System)
Use most recent year. Replace the section (Type 1), (Type 2), and (Type 3) with generation
sources
Month Generation
Nikiski
Combined
Cycle Plant
(kWh)
Generation
Soldotna
Combustion
Turbine
Plant
(kWh)
Generation
Bernice
Lake
Combustion
Plant
(kWh)
Fuel
Consumptio
n
(Diesel-
Gallons)
Fuel
Consumption
Natural Gas
(MCF)
Peak
Load
MWh
Minimum
Load
January 41,899,405 2,097 1,256 2306 368,042 1,553 1,319
February 37,527,357 109,052 1,526 415 334,878 1,563 1,351
March 39,496,815 1,000,229 203,136 2601 365,365 1,572 1,323
April 35,481,301 2,767 151,421 16 319,225 1,456 1,201
May 17,186,990 13,800,750 344,021 9 305,346 1,303 1,182
June 26,701,127 4,402,566 200,985 1036 292,899 1,288 1,071
July 32,859,596 0 3 1182 298,043 1,386 1,209
August 32,356,522 14,203 1,764 44 296,783 1,388 1,044
Septembe
r 20,007,288 10,537,928 321,433 453 286,838 1,443 1,182
October 39,997,133 2,714,565 10,067 15 392,830 1,437 1,277
November 42,267,368 18,194 2,385 1974 380,941 1,683 1,348
December 41,720,850 685,731 1,376 8904 380,057 1,810 1,479
Total 407,501,750
33,288,083
1,239,373
18955
4,021,248
5.4.3 Future Trends
Describe the anticipated energy demand in the community, or whatever will be affected by the
project, over the life of the project. Explain how the forecast was developed and provide year by
year forecasts. As appropriate, include expected changes to energy demand, peak load, seasonal
variations, etc. that will affect the project.
HEA has 24,613 member-owners and provides power to 35,599 meters located throughout
the Kenai Peninsula. HEA sold 452 million kilowatt-hours of electricity in 2020. HEA’S latest
published Equity Management Plan indicates a 1% per year growth rate over the next 15 years but
actual results indicate flat to a slight decline in load due to member efficiency and conservation
efforts. A significant portion of that decline was the shuttering of the LNG and fertilizer-production
facilities on our systems after the rising price of natural gas made them uneconomic.
Predicting the future is difficult but HEA is hopeful that the adoption of electric vehicles along with
other beneficial electrification technologies will result in a return to a 1% per year load growth for the
life of this project.
Additionally, HEA is interconnected to a regional Alaskan grid known as the “Railbelt” via a three
phase, 115 kV transmission line. The Railbelt is generally defined as the service areas of five
regulated public utilities: Chugach Electric Association (Chugach), Golden Valley Electric
Association (GVEA), HEA, Matanuska Electric Association (MEA), and the City of Seward Electric
System (SES). This region grid covers a significant area of the state and contains the majority of the
state’s population and economic activity; it extends from Homer to Fairbanks and includes areas
such as Anchorage, Fairbanks, and the Matanuska-Susitna Valley. HEA can and has regularly
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 22 of 34 11/16/2021
provided power to Alaskan residents from Anchorage to Fairbanks via wholesale and economy
energy sales to the other four interconnected electric utilities.
5.4.4 Proposed System Design
Provide the following information for the proposed renewable energy system:
• A description of renewable energy technology specific to project location
• The total proposed capacity and a description of how the capacity was determined
• Integration plan, including upgrades needed to existing system(s) to integrate renewable
energy system: Include a description of the controls, storage, secondary loads, distribution
upgrades that will be included in the project
• Civil infrastructure that will be completed as part of the project—buildings, roads, etc.
• Include what backup and/or supplemental system will be in place
See the “Proposed System Design” section of the appropriate Best Practice Checklist for additional
guidance.
The technology to be used is the modern wind energy turbine, a proven, emission-free
technology for generating electricity. Specifically, HEA has selected a 3.4 MW wind
turbine manufactured by GE Energy, a world leader in the industry. GE turbines are one
of the most widely used wind turbine in the United States and is part of a fleet of more than 62 GW
of installed capacity. The turbines will be installed with a 117-meter hub height and blades
that provide a 140-meter rotor diameter. This rotor diameter is optimal for use within the
wind resource, such as exists on the project site. The turbine will be equipped with an extreme
cold-weather package to provide reliable operation at temperatures as low as -30°C, and in
survival mode (without operation) at temperatures as low as -40°C. These design parameters
ensure reliable operation in the conditions expected in Alaska and at this specific project site.
Given the existing wind regime, the regional electric demand, and interconnection capacity, the
optimum installed capacity of the project is 30 MW. The project will be integrated to the regional
electric grid through the existing Bernice Lake or Nikiski Substation, owned by HEA . This will permit
delivery of electricity to the bulk power system.
This site is adjacent to the Spur Highway and other substantial local roads that see frequent industrial
traffic. Road upgrades are expected to be minimal to access the site. Approximately 4 miles of new
access road and electric cabling is required to the proposed site. Upgrades to existing road should
be minimal and the surrounding terrain is fairly flat.
The proposed new access road is located on flat, previously disturbed industrial ground which should
minimize archaeological, structural and environmental concerns. The typical design includes a 16-
foot-wide roadbed with a maximum of 10 percent of slope and maximum 135-foot turn radius to
accommodate the long loads.
5.4.4.1 Proposed Power Generation Units
Unit # Resource/
Fuel type
Design
capacity
(kW)
Make Model Expected
capacity
factor
Expected
life
(years)
Expected
Availability
9 Wind 30,000 GE 3.4-140 35.8 25 94.6%
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 23 of 34 11/16/2021
5.4.5 Basic Operation of Proposed Energy System
• To the best extent possible, describe how the proposed energy system will operate: When will
the system operate, how will the system integrate with the existing system, how will the
control systems be used, etc.
• When and how will the backup system(s) be expected to be used
See the “Proposed System Design” section of the appropriate Best Practice Checklist for additional
guidance.
Because wind is a zero-cost fuel, wind projects generally operate whenever the wind is blowing. The
only times the project would need to be curtailed would be if the load on the system was such that
the energy produced by the wind farm was too much for the system and the BESS to handle. HEA
is experienced with integrating renewable hydro power into their system and is committed to
integrating wind into their system as well. HEA recently installed a battery energy storage system
(BESS), partially to prepare their electric system to handle the intermittent nature of wind generation.
Sized at 46.5 MW, the BESS has the ability to inject into (or absorb from) the system more power
than the proposed wind facility could generate, Hence, it can immediately replace power in periods
when wind speed and power production decrease. Conversely, should wind output suddenly
increase beyond the turn-down ratio or ramp rate of other combustion or hydro generation assets,
the BESS can be charged during those periods and largely avoid curtailment of the wind energy.
With 93 MWh of energy storage capacity, the BESS could theoretically store (or stand in for) 3 hours
of wind production from the proposed project.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 24 of 34 11/16/2021
The desktop studies performed during HEA’s site selection process predicted greater energy
production in winter months which matches HEA’s seasonal load profile as the lower average wind
speeds in summer also match HEA’s lower system loads in summer and may provide a more suitable
window for tower erection and nacelle and blade lifting and installation during summer months.
Additional studies will be done to study the hourly and sub-hourly production ramp rates to determine
what is necessary to integrate this project into HEA’s system while maintaining consistent power for
member needs.
5.4.3.1 Expected Capacity
Factor
35.8%
A preliminary analysis was completed based on 200m resolution mesoscale modeled wind data
showing an expected average wind speed of 7.1 m/s with a 120m hub height. Based upon the GE
3.4-140 h117 turbine, an expected net capacity factor of 35.8% was determined at this site.
Further on-site data collection is required to both validate and refine these expectations.
This NCF is inclusive of loss factors such as availability, turbine performance, wakes/blocking,
electrical, environmental and curtailment. These loss factors were estimated by ReGenerate
based upon industry standard values or calculated on a site-specific basis where applicable.
5.4.5.2 Annual Electricity Production and Fuel Consumption (Proposed System)
Month Generation
(Proposed
System)
(kWh)
Generation
(Type 2)
(kWh)
Generation
(Type 3)
(kWh)
Fuel
Consumption
(Diesel-
Gallons)
Fuel
Consumption
[Other]
Secondary
load
(kWh)
Storage
(kWh)
January 10,049,382
February 8,785,146
March 8,901,250
April 7,159,701
May 6,475,982
June 6,050,270
July 5,959,967
August 5,908,366
September 7,250,003
October 8,256,232
November 9,559,168
December 9,791,375
Total 94,146,840
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 25 of 34 11/16/2021
5.4.6 Proposed System Operating and Maintenance (O&M) Costs
O&M costs can be estimated in two ways for the standard application. Most proposed renewable
energy projects will fall under Option 1 because the new resource will not allow for diesel
generation to be turned off. Some projects may allow for diesel generation to be turned off for
periods of time; these projects should choose Option 2 for estimating O&M.
Option 1: Diesel generation ON
For projects that do not result in shutting down
diesel generation there is assumed to be no
impact on the base case O&M. Please indicate
the estimated annual O&M cost associated with
the proposed renewable project.
Option 2: Diesel generation OFF
For projects that will result in shutting down
diesel generation please estimate:
1. Annual non-fuel savings of shutting off
diesel generation
2. Estimated hours that diesel generation
will be off per year.
3. Annual O&M costs associated with the
proposed renewable project.
1. $
2. Hours diesel OFF/year:
3. $400,000 annual estimate
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 26 of 34 11/16/2021
5.5 Performance and O&M Reporting
For construction projects only
5.5.1 Metering Equipment
Please provide a short narrative, and cost estimate, identifying the metering equipment that will be
used to comply with the operations reporting requirement identified in Section 3.15 of the Request
for Applications.
N/A
5.5.2 O&M reporting
Please provide a short narrative about the methods that will be used to gather and store reliable
operations and maintenance data, including costs, to comply with the operations reporting
requirement identified in Section 3.15 of the Request for Applications
N/A
SECTION 6 – ECONOMIC FEASIBILITY AND BENEFITS
6.1 Economic Feasibility
6.1.1 Economic Benefit
Annual Lifetime
Anticipated Diesel Fuel Displaced for Power
Generation (gallons)
Anticipated Fuel Displaced for Heat
(gallons)
Total Fuel displaced (gallons)
Anticipated Diesel Fuel Displaced for Power
Generation ($)
Anticipated Fuel Displaced for Heat ($)
Anticipated Power Generation O&M Cost
Savings
Anticipated Thermal Generation O&M Cost
Savings
Total Other costs savings (taxes, insurance,
etc.)
Total Fuel, O&M, and Other Cost Savings $9,140,716
6.1.2 Economic Benefit
Explain the economic benefits of your project. Include direct cost savings and other economic
benefits, and how the people of Alaska will benefit from the project. Note that additional revenue
sources (such as tax credits or green tags) to pay for operations and/or financing, will not be
included as economic benefits of the project.
Where appropriate, describe the anticipated energy cost in the community, or whatever will be
affected by the project, over the life of the project. Explain how the forecast was developed and
provide year-by-year forecasts
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 27 of 34 11/16/2021
The economic model used by AEA is available at https://www.akenergyauthority.org/What-We-
Do/Grants-Loans/Renewable-Energy-Fund/2021-REF-Application. This economic model may be
used by applicants but is not required. The final benefit/cost ratio used will be derived from the
AEA model to ensure a level playing field for all applicants. If used, please submit the model with
the application.
In addition to a lower cost of energy arising from HEA’s avoided cost for natural gas, this wind project
allows HEA to diversify their energy sources and therefore be less sensitive to increasing natural-
gas prices and less vulnerable to gas availability issues.
To the extent that HEA reduces their gas consumption, the life of finite gas resources in Cook Inlet
is extended for all users in the region and seasonal gas availability issues are diminished.
If financed by HEA, the debt service and depreciation costs would be nearly constant in 2024/2025
dollars and therefore decreasing, in real dollars, throughout the project projected 25-year life
meaning that in addition to an initial downward pressure on consumer rates, the project’s output
would continue to resist the inflationary pressure of HEA’s combustion assets.
6.1.3 Economic Risks
Discuss potential issues that could make the project uneconomic to operate and how the project
team will address the issues. Factors may include:
• Low prices for diesel and/or heating oil
• Other projects developed in community
• Reductions in expected energy demand: Is there a risk of an insufficient market for energy
produced over the life of the project.
• Deferred and/or inadequate facility maintenance
• Other factors
Logistical, supply-chain and tax policy risks are detailed in the table below:
Risk Importance Mitigation Strategy
Unexpected increase in turbine
component or delivery costs
High Early coordination with turbine vendors to
protect against price volatility
Labor shortages for construction or
operations phases
Medium Establish a labor resource plan in advance of
construction activities
Foreign exchange risk with
European or Asian based turbine
manufacturers
Low Explore domestic content options
Lack of federal tax incentive
extension
Medium Vigilant monitoring of developments in
Washington
Lack of crane availability in Alaska Medium Proactive and early discussions with BoP
providers
Difficulties in site deliveries due to
challenges with shipping in Alaska
High Coordination with turbine vendors, self-
performance of certain scope items
6.1.4 Public Benefit for Projects with Direct Private Sector Sales
For projects that include direct sales of power to private sector businesses (sawmills, cruise ships,
mines, etc.), please provide a brief description of the direct and indirect public benefits derived from
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 28 of 34 11/16/2021
the project as well as the private sector benefits and complete the table below. See Section 1.6 in
the Request for Applications for more information.
N/A
6.2 Other Public Benefit
Describe the non-economic public benefits to Alaskans over the lifetime of the project. For the
purpose of evaluating this criterion, public benefits are those benefits that would be considered
unique to a given project and not generic to any renewable resource. For example, decreased
greenhouse gas emission, stable pricing of fuel source, won’t be considered under this category.
Some examples of other public benefits include:
• The project will result in developing infrastructure (roads, trails, pipes, power lines, etc.) that can
be used for other purposes
• The project will result in a direct long-term increase in jobs (operating, supplying fuel, etc.)
• The project will solve other problems for the community (waste disposal, food security, etc.)
• The project will generate useful information that could be used by the public in other parts of the
state
• The project will promote or sustain long-term commercial economic development for the
community
This project will repurpose industrial property in an area that has seen a significant decline in
industrial activity and employment.
SECTION 7 – SUSTAINABILITY
Describe your plan for operating the completed project so that it will be sustainable throughout its
economic life.
At a minimum for construction projects, a business and operations plan should be attached and the
applicant should describe how it will be implemented. See Section 11.
7.1.1 Operation and Maintenance
Demonstrate the capacity to provide for the long-term operation and maintenance of the proposed
project for its expected life
• Provide examples of success with similar or related long-term operations
• Describe the key personnel that will be available for operating and maintaining the
infrastructure.
• Describe the training plan for existing and future employees to become proficient at operating
and maintaining the proposed system.
• Describe the systems that will be used to track necessary supplies
• Describe the system will be used to ensure that scheduled maintenance is performed
The facility will be remotely operated and monitored utilizing HEA’s existing SCADA infrastructure from the
existing HEA Dispatch Center which is staffed 24 hours a day, 7 days a week, 365 days a year. Scheduled
site inspections, planned and unplanned maintenance will be conducted by HEA’s exiting roving Operations
& Maintenance crew that currently maintains and operates HEA’s unmanned thermal generation plants in
Nikiski, Soldotna and Seldovia. Existing personnel will provide the labor needed to operate and maintain the
facility. Existing company vehicles, tooling and equipment currently utilized by the roving operations and
maintenance crew will be utilized to conduct onsite work. HEA operates the Bradley Lake Hydro Facility for
the State of Alaska and is experience at operating and maintaining equipment in remote areas.
HEA would use its existing maintenance scheduling, inventory control, outage scheduling, warehousing and
accounting procedures to coordinate and track scheduled and unscheduled maintenance on these new
assets. HEA plans to use its own employees to operate and maintain
any new generation assets.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 29 of 34 11/16/2021
7.1.2 Financial Sustainability
• Describe the process used (or propose to use) to account for operational and capital costs.
• Describe how rates are determined (or will be determined). What process is required to set
rates?
• Describe how you ensure that revenue is collected.
• If you will not be selling energy, explain how you will ensure that the completed project will be
financially sustainable for its useful life.
This generation asset will be owned and operated by AEEC / HEA which will use established and
existing utility accounting practices, procedures, financial systems, accounting personnel, and
outside independent audits to account for operational and capital costs.
HEA rates are set by the member-elected Board of Directors on an annual basis (and modified
each mid-year). HEA develops its annual budget to cover all its operational expenses, debt
service, fuel costs, and margins required to comply with lender’s loan covenants, HEA’s own
capital-credits policy, and sufficient to fund system maintenance and upgrades. Those rates
(tariffs) are then reviewed and approved by the Regulatory Commission of Alaska.
As part of the existing AEEC / HEA generation fleet revenues would be collected through HEA’s
existing monthly billing process and systems.
7.1.2.1 Revenue Sources
Briefly explain what if any effect your project will have on electrical rates in the proposed benefit
area over the life of the project. If there is expected to be multiple rates for electricity, such as a
separate rate for intermittent heat, explain what the rates will be and how they will be determined
Collect sufficient revenue to cover operational and capital costs
• What is the expected cost-based rate (as consistent with RFA requirements)
• If you expect to have multiple rate classes, such as excess electricity for heat, explain what
those rates are expected to be and how those rates account for the costs of delivering the
energy (see AEA’s white paper on excess electricity for heat)..
• Annual customer revenue sufficient to cover costs
• Additional incentives (i.e. tax credits)
• Additional revenue streams (i.e. green tag sales or other renewable energy subsidies or
programs that might be available)
HEA / AEEC expects to add this environmentally-friendly, beneficial, renewable-energy project to
AEEC’s generation portfolio without negatively impacting rates. This will depend on the final actual
cost of the project, any grants, direct pay tax incentives, legislative appropriations, power-
production-incentives, greenhouse-gas, and / or renewable-energy credits received and the capital
financing terms of the project.
Operational and capital costs will be covered through revenues received from the sale of power to
HEA’s members. The purchased-power rates are set by HEA’s member elected Board of Directors
and reviewed and approved by the Regulatory Commission of Alaska.
Since HEA is a not-for-profit entity, no rate of return is incorporated into the rates that HEA charges
its members. HEA provides power at cost plus an allowed RCA specified operational margin. As
mentioned above it is HEA’s hope that this project will not increase the HEA’s current rates
(https://www.homerelectric.com/member-services/my-bill/rates/) but will provide a downward
pressure on rates upon commissioning and into the future.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 30 of 34 11/16/2021
7.1.2.2 Power Purchase/Sale
The power purchase/sale information should include the following:
• Identification of potential power buyer(s)/customer(s)
• Potential power purchase/sales price - at a minimum indicate a price range (consistent with the
Section 3.16 of the RFA)
Identify the potential power buyer(s)/customer(s) and anticipated power purchase/sales price
range. Indicate the proposed rate of return from the grant-funded project. Include letters of support
or power purchase agreement from identified customers.
Since the generation asset will be owned and operated by AEEC / HEA which are RCA certificated
utilities, no power purchase / sales agreement will be needed. The generation will be incorporated
into AEEC’s existing generation portfolio that provides power to HEA members. Since HEA is a
not-for-profit entity, no rate of return is incorporated into the rates that HEA charges its members.
HEA provides power at cost plus an allowed, RCA-specified operational margin.
SECTION 8 – PROJECT READINESS
8.1 Project Preparation
Describe what you have done to prepare for this award and how quickly you intend to proceed with
work once your grant is approved.
Specifically address your progress towards or readiness to begin, at a minimum, the following:
• The phase(s) that must be completed prior to beginning the phase(s) proposed in this application
• The phase(s) proposed in this application
• Obtaining all necessary permits
• Securing land access and use for the project
• Procuring all necessary equipment and materials
Refer to the RFA and/or the pre-requisite checklists for the required activities and deliverables for
each project phase. Please describe below and attach any required documentation.
HEA / AEEC plans to specify and solicit quotes for the equipment and resources required to
compete the resource assessment. AEEC will continue to engage with landowners. If this grant
application makes the cut for what is proposed to the legislature, AEEC will begin the process of
pursuing land use permits or a lease required to erect a meteorological tower. AEEC will also
pursue other permits required to install the MET tower all in advance of grant award so that come
July the resource assessment activities can immediately begin.
8.2 Demand- or Supply-Side Efficiency Upgrades
If you have invested in energy efficiency projects that will have a positive impact on the proposed
project, and have chosen to not include them in the economic analysis, applicants should provide
as much documentation as possible including:
1. Explain how it will improve the success of the RE project
2. Energy efficiency pre and post audit reports, or other appropriate analysis,
3. Invoices for work completed,
4. Photos of the work performed, and/or
5. Any other available verification such as scopes of work, technical drawings, and payroll for
work completed internally.
HEA/AEEC has installed the largest Battery Energy Storage System (BESS) in Alaska. It has been
tested, found able to exceed the maximum discharge rates specified in procurement contracts, and
will allow more flexible, efficient operation of our current thermal and future renewable assets.
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 31 of 34 11/16/2021
With capacities of 46.5 MW and 93 MWh, this $41M project was untaken to give HEA the ability to
bring large intermittent projects online without incurring the costs of rapidly cycling thermal units
and without adversely affecting the Railbelt grid.
SECTION 9 – LOCAL SUPPORT AND OPPOSITION
Describe local support and opposition, known or anticipated, for the project. Include letters,
resolutions, or other documentation of local support from the community that would benefit from
this project. Provide letters of support, memorandum of understandings, cooperative agreements
between the applicant, the utility, local government and project partners. The documentation of
support must be dated within one year of the RFA date of November 16, 2021. Please note that
letters of support from legislators will not count toward this criterion.
Included as Attachment B are letters of support from the following:
Erin McKittrick, the Board President, Alaska Electric and Energy Cooperative.
Peter Micciche, Alaska State Senator, District O.
Cook Inlet Keeper, environmental advocacy group.
Kenai Peninsula Economic Development District.
Resolution supporting the project from the Kenai Peninsula Borough Resilience and Security
Advisory Commission.
SECTION 10 – COMPLIANCE WITH OTHER AWARDS
Identify other grants that may have been previously awarded to the Applicant by AEA for this or
any other project. Describe the degree you have been able to meet the requirements of previous
grants including project deadlines, reporting, and information requests.
Homer Electric Association through its wholly own subsidiary Kenai Hydro, completed some Phase
I Reconnaissance studies, which were completed in January 2009 and were partially funded by
a $100,000 AEA grant. Kenai Hydro received partial funding for Phase II activities in the amount of
$2,000,000 through two separate awards of $816,000 and of $1,184,400 through AEA Renewable
Energy Grants.
Kenai Hydro complied with all terms of the grant agreements from previously award grants, which
included timely quarterly progress reports, delivery of agreed upon deliverables, and closeout of
the grants.
SECTION 11 – LIST OF SUPPORTING DOCUMENTATION FOR PRIOR PHASES
In the space below, please provide a list of additional documents attached to support completion of
prior phases.
Attachment D: East Foreland / Nikiski Wind Site Reconnaissance Data
SECTION 12 – LIST OF ADDITIONAL DOCUMENTATION SUBMITTED FOR CONSIDERATION
In the space below, please provide a list of additional information submitted for consideration.
Attachment A: Resumes, submitted as a separate file
Attachment C: Board Resolution & Authorization
Attachment E: BESS Informational Flyer
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 31 of 33 11/16/2021
SECTION 13 – AUTHORIZED SIGNERS FORM
Community/Grantee Name:
Regular Election is held: Date:
Authorized Grant Signer(s):
Printed Name Title Term Signature
I authorize the above person(s) to sign Grant Documents:
(Must be authorized by the highest ranking organization/community/municipal official)
Printed Name Title Term Signature
Grantee Contact Information:
Mailing Address:
Phone Number:
Fax Number:
Email Address:
Federal Tax ID #:
Please submit an updated form whenever there is a change to the above information.
Bradley P. Janorschke General Manager N/A
907-235-8551
907-235-3323
Alaska Electric & Energy Cooperative, Inc
Annually June
3977 Lake Street, Homer, AK 99603
bjanorschke@homerelectric.com
92-0177236
Bradley P. Janorschke General Manager N/A
907-235-8551
907-235-3323
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 32 of 33 11/16/2021
SECTION 14 – ADDITIONAL DOCUMENTATION AND CERTIFICATION
SUBMIT THE FOLLOWING DOCUMENTS WITH YOUR APPLICATION:
A. Contact information and resumes of Applicant’s Project Manager, Project Accountant(s),
key staff, partners, consultants, and suppliers per application form Section 3.1, 3.4 and
3.6.
Applicants are asked to provide resumes submitted with applications in separate electronic
documents if the individuals do not want their resumes posted to the project web site.
B. Letters or resolutions demonstrating local support per application form Section 9.
C. For projects involving heat: Most recent invoice demonstrating the cost of heating fuel
for the building(s) impacted by the project.
D. Governing Body Resolution or other formal action taken by the applicant’s governing
body or management per RFA Section 1.4 that:
• Commits the organization to provide the matching resources for project at the match
amounts indicated in the application.
• Authorizes the individual who signs the application has the authority to commit the
organization to the obligations under the grant.
• Provides as point of contact to represent the applicant for purposes of this
application.
• Certifies the applicant is in compliance with applicable federal, state, and local, laws
including existing credit and federal tax obligations.
E. An electronic version of the entire application on CD or other electronic media, per RFA
Section 1.7.
F. CERTIFICATION
The undersigned certifies that this application for a renewable energy grant is truthful
and correct, and that the applicant is in compliance with, and will continue to comply
with, all federal and state laws including existing credit and federal tax obligations and
that they can indeed commit the entity to these obligations.
Print Name
Signature
Title
Date
Bradley P. Janorschke
General Manager
January 18, 2022
Renewable Energy Fund Round 14
Grant Application – Standard Form
AEA 23001 Page 34 of 34 11/16/2021
AEEC East Foreland / Nikiski Wind REF Round 14 Application
Attachment A: Resumes (attached as a separate file)
AEEC East Foreland / Nikiski Wind REF Round 14 Application
Attachment B: Letters of Local Support
To whom it may concern,
Homer Electric Association (HEA) is a member-owned electric cooperative serving customers
on the Kenai Peninsula, governed by a nine-member board. As a democratically elected body,
our board represents the interests of HEA’s more than 24,000 members, and speaks on their
behalf.
In our commitment to providing affordable and reliable electricity, we regularly review the
cooperative’s finances, analyzing cost drivers, risks, and opportunities. Natural gas costs are
responsible for around a third of members’ bills. This gas is only available from a single source,
and at the time of our last contract negotiation, only from a single provider. The board has
determined that this reliance on a single energy source is a substantial risk to our members. We
have created an ambitious renewable energy policy to address this issue, seeking 50%
renewable energy by 2025.
We have determined that incorporating diverse renewable sources of energy into our energy
portfolio will benefit HEA members, reduce our vulnerability to price or supply shocks, and
reduce upward pressure on electric rates.
Extensive desktop modeling shows that the East Foreland, Ninilchik/Anchor Point, Summit
Lake, and Caribou Hills sites described in these applications represent opportunities to develop
wind energy on the Kenai Peninusla for less than the current costs of gas-fired electricity. HEA’s
recent construction of a BESS gives us a significant ability to integrate this variable energy.
To determine feasibility, any wind project needs on-the-ground data from a meteorological
tower. I encourage AEA to fund these requests for met tower installations. The resulting data
will be critical to HEA’s efforts to diversify our energy sources. Data produced at these sites will
be available not just to HEA, but also to other utilities and independent power producers.
Railbelt utilities are doing substantial work to coordinate planning efforts and improve
transmission. Any wind energy development resulting from these studies will benefit HEA
members, and may have the potential to benefit electricity customers across the Railbelt.
Sincerely,
Erin McKittrick
Board President, Alaska Electric and Energy Cooperative
(Alaska Electric and Energy Cooperative is a generation and transmission cooperative with HEA
as it’s sole member, sharing a governing body. AEEC is responsible for generating and
providing all the energy to HEA)
Session Address:
Alaska State Capitol, Rm. 111
Juneau, Alaska 99801-1182
Phone: (907) 465-2828
Toll Free: (800) 964-5733
Interim Address:
145 Main Street Loop, Ste. 226
Kenai, Alaska 99611-7771
Phone: (907) 283-7996
Fax: (907) 283-8127
Senator Peter A. Micciche
Alaska State Legislature
President of the Senate
Senator.Peter.Micciche@akleg.gov
January 17,2022
Grants Administrator
Alaska Energy Authority
813 West Northern Lights Blvd.
Anchorage, AK 99503
Dear Administrator:
I support Homer Electric Association's request for grant funding of feasibility analyses of
prospective wind-energy generation sites in the Caribou Hills, Ninilchik/Anchor Point, East
Foreland, and Summit Lake areas.
Any one of these projects could almost double HEA's renewable energy portfolio and assist the
State of Alaska and the Cooperative's goals to produce 50 percent of Alaska's electrical energy
from renewable resources by 2025. While no single project will meet these goals, a diverse
portfolio of inexpensive intermittent wind and solar energy with firm hydro and natural-gas
generation is likely to provide the lowest cost of reliable power. As a practical matter,
integrating all or some of these projects into HEA’s energy portfolio results in supply
diversification from HEA’s current 86% dependency on a single vendor and results in energy
security.
This project is consistent with the State of Alaska’s own renewable energy goal and the HEA’s
Board of Director’s goal to produce 50 percent of their electrical energy from renewable
resources by 2025. Any of these projects that advance to completion could be a significant
portion of those goals.
Golden Valley Electric Association receives wind energy from Eva Creek; Chugach and
Matanuska Electric from Fire Island, and Kodiak has achieved lower energy costs through their
Senator.Peter.Micciche@akleg.gov
combination of wind and hydro. Homer Electric staff are hopeful that these prospects offer as
good or better economics due to their proximity to existing roads and/or transmission and good
to great wind resources which hopefully can be confirmed through these proposed feasibility
studies.
I appreciate the efforts of Homer Electric Association to bring renewable energy to the Kenai
Peninsula and believe these wind resources studies deserve to be ranked highly in the Round
XIV of the Alaska Energy Authority's Renewable Energy Grant Program.
Thank you for your consideration of this funding request.
Sincerely,
Senator Peter A. Micciche
District O
Grants Administrator
Alaska Energy Authority
813 West Northern Lights Blvd.
Anchorage, AK 99503 January 15, 2022
Dear Alaska Energy Authority Grants Administrator:
As a community organization with a mission to protect the Cook Inlet watershed and the life it sustains,
Cook Inletkeeper fully supports Homer Electric Association's Renewable Energy Fund grant application
for feasibility analyses of prospective wind energy sites in the Caribou Hills, Ninilchik/Anchor Point, East
Forelands, and Summit Lake areas.
Bringing wind power to the Kenai Peninsula would help lower energy prices currently being driven
upward by the economics of Cook Inlet natural gas. HEA’s generation is 85% gas-fired, and a sole
producer, Hilcorp, is able to meet the utility’s requirements for delivering that gas. Depending on
deliverability of a single fuel from a single company makes the Kenai Peninsula’s energy system highly
vulnerable to both physical disruptions and to market conditions that in recent decades have made local
gas much more expensive than in the Lower 48. Diversifying HEA's energy sources will strongly benefit
Kenai Peninsula homes and businesses.
Wind generation, and the storage needed for the grid to support its variable output, are both mature
technologies ripe for deployment. As of 2020, analysts have ranked wind facilities among those with the
lowest levelized cost of power – a measure of a project’s lifetime cost divided by its lifetime energy
production. In Alaska, large-scale wind generation has been successfully built on Fire Island, Eva Creek,
and Kodiak, where a combination of wind and hydropower has drastically lowered energy costs.
If explored and developed, the peninsula's largely untapped wind resources can contribute significantly
to the goal, held by both HEA and the state, of achieving 50% renewable energy by 2025. HEA has carefully
chosen its four study sites to balance energy potential with the logistical costs of study and construction
– placing them near existing roads and/or transmission – making them cost-effective opportunities to
start bringing wind generation to the Kenai Peninsula.
If built alongside dispatchable storage and hydroelectricity, intermittent wind and solar power can give
HEA a diverse, economical generation portfolio that counters the inflation of energy prices, unshackles
the energy we rely on from a unstable and increasingly expensive gas market, and phases out climate-
damaging carbon emissions. HEA’s wind exploration plans are important steps to these worthy goals, and
deserve a high ranking in your Renewable Energy Fund recommendations to the legislature.
Sincerely,
Sue Mauger, Science & Executive Director
Kaitlin Vadla, Central Peninsula Regional Director Ben Boettger, Energy Organizer
AEEC East Foreland / Nikiski Wind REF Round 14 Application
Attachment C: Board Resolution & Authorization
Alaska Electric and Energy Cooperative, Inc. 3977 Lake Street Homer, Alaska 99603 (907) 235-8551
RESOLUTION 01.2022.02
GRANT FUNDING AUTHORIZATION FOR EAST FORELAND WIND PROJECT
BE IT RESOLVED that Alaska Electric & Energy Cooperative, Inc. (AEEC) hereby
authorizes the General Manager to proceed with the Alaska Energy Authority (AEA) application
process to seek grant funding for the East Foreland Wind project.
CERTIFICATION
I, Jim Duffield, do hereby certify that I am the Secretary/Treasurer of Alaska Electric &
Energy Cooperative, Inc., and that the foregoing resolution was adopted at a meeting of the
Directors of Alaska Electric & Energy Cooperative, Inc., held on January 11, 2022, at which
meeting a quorum was present.
Jim Duffield, Secretary/Treasurer
Alaska Electric and Energy Cooperative, Inc.
3977 Lake Street Homer, Alaska 99603 (907) 235-8551
CERTIFICATE OF GENERAL MANAGER OF ALASKA ELECTRIC AND ENERGY
COOPERATIVE, INC. (AEEC) IN SUPPORT OF EAST FORELAND WIND PROJECT
GRANT APPLICATION
I am the General Manager of Alaska Electric and Energy Cooperative, Inc. (the
“Cooperative”). I am authorized by the Board of Directors of the Cooperative pursuant to Board
Policy 203, and by formal action of the Board of Directors of the Cooperative at a meeting held
on January 11, 2022 to certify as follows:
1.The Board of Directors of the Cooperative has authorized the application for project
funding and agrees that the Cooperative will honor the match amounts contained in the
application to which this certificate is attached.
2.The Cooperative is in good standing with respect to any existing credit and federal tax
obligations.
Signed and dated in Kenai, Alaska, on January 11, 2022.
____________________________________
Bradley P. Janorschke
General Manager
AEEC East Foreland / Nikiski Wind REF Round 14 Application
Attachment D: East Foreland / Nikiski Wind Site
Reconnaissance Data
32
Site elevation (m) 38
Wind class III
Wind speed (m/s) 7.1
Net capacity factor (%) 35.8
Site access conditions 4 (good)
BoP conditions 3 (fair)
Interconnection conditions 5 (great)
Site 9
33
AEEC East Foreland / Nikiski Wind REF Round 14 Application
Attachment E: BESS Informational Flyer
Battery ENERGY STORAGE SYSTEM
potential savings
Fuel Reduction: 477,074 MCF/yr
CO2 Total Reduction: 28,320.35 tons/yr
CO2 Reduction/Day: 77.59 tons/day
Fuel Efficiency Increase: 11.49%
(*Based on actual vs. modeled for January - June 2019)
For more details
contact:
Brad Janorschke
HEA General
Manager
(907) 283-2312
bjanorschke@
homerelectric.com
The BESS Project is
a 93 megawatt hour
(MWh) energy storage
system sited at our
Soldotna, Alaska
Facilities as depicted
above.
BESS will be in service
in late 2021 and has a
projected cost of $38
million.
BESS site
Regulation, spinning reserve
and emergency reserve.
Integration of renewables
(wind, solar, tidal).
Islanding or Bradley Lake
outages no longer require a second thermal unit.
Potential to sell Spin/Regulation.
Provides system stability by reducing frequency swings
and load sheds.
Helps to stabilize energy
costs during islanding events.
benefitsBATTERY SUPPLY
37 battery units with integrated chargers and
inverters, control system and monitoring.
93 mwh storage
46 mw for 2 hours
delivered power
soldotna combustion
turbine facility
soldotna substation
Alaska Electric & Energy Cooperative, Inc.