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HomeMy WebLinkAboutNAB Application Signed - reducedRenewable Energy Fund Round 14 Grant Application -Standard Form Application Forms and Instructions ALASKA ENERG Y AUT H OR ITY 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: tip::, //wvv ~ I ( 10\i:.ll ' I rq'\VI I lp [ ./Grants I rci R ~nP\ I .-liP I lV. I I') 1~ REF -A ppllc~. 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 doc uments to your application. • If you have additional information or reports you would like the Authority to consider in reviewing your application, e ither 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 Checkli sts ; links to the checklists can be found in the appendices list at the end of the accompanying REF Round 14 RFA. • In the Section s 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 ,, ' ""' ~ .-, 1 e 11 .g or by phone at (907) 771-3081. AEA 23001 Page I of 45 1111 6/202 1 Renewable Energy Fund Round 14 Grant Application -Standard Form REMINDER: ALASKA ENERGY AUTHORITY • 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 iden ti fy 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 determ ines 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. AEA 2300 1 Page 2 of45 11/16/2021 Renewable Ener gy Fund Round 14 Grant Application -Standa rd F orm SECTION 1-APPLICANT INFORMATION ALASKA ENERGY AUTHORITY Please specify the legal grantee that will own, operate, and maintain the project upon completi on . I Name (Name of utility, IPP, local g overnment, or oth er g overnment entity) I Northwest Arcti c Borough (NAB ) Tax ID # 92-0116661 Date of last financial statement audit: 6/30/2020 Mailing Address: Physical Address: P .O . Bo x 1110 163 Lag oon St Kotzebue , AK 99752 Kotzebue, AK 99 75 2 Telephone: Fax: Ema i l: 907-442-2 500 907-442 -2 93 0 imathia sso n@nwabor.org I 1.1 Applicant Point of Contact I Grants Coordi nat or Name: Ingemar Mathiasson T itle: Energy Manager Mailing Address: P.O. Box 1110 Kotzebue, AK 99752 Telephone: Fax: Email : 907-445-2 03 1 90 7 -442 -2930 im a thi asson@ nwabor.org 1.1.1 Appl icant Signatory Aut hority Contact Infor mati on Name: Dickie Moto Title: Mayor Mai l ing Address : P.O. Box 1110 Kotzebue, AK 99752 Teleph one: Fax: Ema il: 9 07-442-8201 d moto@ nwa bo r .o rg 1.1.2 Applicant Alternate Points of Contact Name Te l ephone: Fax: Email: Erin Step he ns 90 7-442-822 1 907 -442 -2930 EStephen s@ nwabo r.org AEA 23 001 Page 3 of 45 11/16/2 021 Renewable Energy Fund Round 14 Grant Application-Standard Form ALASKA ENERG Y A UTHORI TY 1.2 Applicant Minimum Requirements Please check as appropriate. If applicants do not meet the minimum requirements, the application will be rejected. 11.2.1 Applicant Type D An electric utility holding a certificate of publ ic convenience and necessity under AS 42.05 CPCN # , or D An independent power producer in accordance with 3 AAC 107.695 (a) (1) CPCN # , or ~ A local government, or D A governmental entity (which includes tribal councils and housing authorities) Add"f t 1 1ona mm1mum reqUiremen s ~ 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 govern ing authority. If the applicant is a collaborative grouping , a formal approval from each participant's governing authority is necessary. (In dicate 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 I 11 I I k I tit . " I •I D ,, I l ) I I" r,...., ...: f t r d1 0 If ET I'll I 1 1J. (Any exceptions should be clearly noted and submitted with the application .) (In dicate 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 beneficia ries. (Indicate yes by checking the box) AEA 2300 1 Page 4 of45 11 /16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form I SECTION 2 -PROJECT SUMMARY 2.1 Project Title A LASKA ENE RGY AUTHORITY Provide a 4 to 7 word title for your project. Type in the space below. Design and Permitting for Solar PV and Battery Storage for Ambler, Kiana, Noorvik , and Selawik I 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 Goot~, 1. ; 2 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 r ~ 1IS@nl l II II c 'lLOr by phone at (907) 771- 3081 . Latitude Ambler-67.08816 Kiana -66.97164 Noorvik-66.83311 Selawik • 66.60088 [Other description of location] Longitude -157.86581 -160.43651 -161.04077 -160.00472 The Villages of Ambler, Kiana, Noorvik , and Selawik are all located in the Northwest Arctic Borough. Ambler, Kiana, and Noorvik are located along the banks of the Kobuk River. Selawik is located at the mouth of the Selawik River. All four communities are located above the Arctic Circle. The region experiences a transitional climate, characterized by long, cold winters and cool summers. Temperatures range from -52 to 85 degrees Fahrenheit. Total precipitation averages nine inches per year and average annual snowfall is forty seven inches. 2.2.2 Community benefiting-Name(s) of the community or communities that will be the beneficiaries of the project. The communities of Ambler, Kiana, Noorvik, and Selawik will benefit from this project that will complete the design and permitting phase of this solar PV and Battery Storage project. Funding requested here will bring the proposed projects to "shovel ready" status. Upon final construction, the communities will have a more resilient energy infrastructure with capabilities of supplying their community electricity needs at times without any diesel generation . This project will stabilize and potentially lower the cost of energy production for the communities resulting in less out-migration from community members that can no longer afford to live in their home. Stabilized energy cost can also foster economic development opportunities . The projects will also build capacity in the communities for project management and O&M skills for renewable energy systems. The Alaska Village Electric Cooperative (AVEC), which is the electric utility for all four communities, will also benefit from increased energy generation assets, improved reliability with less outages , less fuel shipping needs, and enhanced local capacity. 2.3 Project Type Please check as appropriate. I 2.3.1 Renewable Resource Type 0 Wind D Biomass or Biofuels (excluding heat-only) AEA 23001 Page 5 of45 11/16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form D Hydro, Including Run of River D Hydrokinetic ALASKA ENERGY A UTHORITY D Geothermal, Excluding Heat Pumps D Transmission of Renewable Energy Solar Photovoltaic Storage of Renewable lo Other (Describe) D Small Natural Gas 1 2.3.2 Proposed Grant Funded Phase(s) for this Request (Check all that apply) Pre-Construction Constructi on D Reconnaissance 181 Final Design and Permitting D Feasibility and Conceptual Design D Construction 2.4 Project Description Provide a brief, one-paragraph description of the proposed project. The Northwest Arctic Borough (NAB) is requesting $590,000 for the Phase Ill Final Design and Permitting for four high penetration distributed solar PV, Battery, and diesel hybrid systems for the communities of Ambler, Kiana, Noorvik , and Selawik. The intent of this project is to leverage the economies of scale for the design of the systems to significantly reduce the project development costs and improve the project economics. The economies of scale will also be leveraged in the future construction phase of the systems through equipment procurement and construction contracts. Based on Hybrid Optimization for Multiple Energy Resources (HOMER) software modeling and AEA's B/C Ratio model, when constructed these systems will displace about 102,099 gallons of imported diesel fuel annually and will result in about 3717 hours of diesels-off operation in the communities, saving the communities about $486,152 during the 1st year of operation . Lifetime savings for the project are estimated at $13,458,097. In addition to reducing the cost of electrical generation, the installation of the batteries will dramatically increase the efficiency and resilience of the power generation system by providing spinning reserve and significantly reducing brown-outs and black-outs. This project will leverage the key learnings from other high penetration systems operating and in development in the Northwest Arctic Borough, including Kotzebue, Deering, Buckland, Shungnak, and Noatak. 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. The project scope includes the design and permitting of the following components: • Confirmation of recommended system sizing (PV, Battery, and Converters) from the HOMER modeling based on most recent community production data, fuel costs, and expected capital costs. • Finalize solar array siting locations. • Complete permitting applications. • Develop RFP's for the procurement of Geotech and engineering design and if required, geotechnical analysis. • Perform geotechnical analysis on each siting location if required. • Design Solar PV foundations. AEA 23001 Page 6 of 45 11116/2021 Renewable Energy Fund Round 14 Grant A pplication-Standard Form ALASKA ENERG Y AUTHORITY • Designs for upgraded switchgear for Ambler, Kiana , Noorvik, Selawik in conjunction with AVEC. • Design Battery bui lding and foundation . • Compl ete electrical and controls integration design including integration with the switchgea r in the community power plants , includ ing a remote monitoring system to record data , evaluate system performance , and aid in remote troubleshooting . • IPP Ownership model, Business Plan , and Power Purchase Agreement. • Matching local in-kind funds from the NAB and NANA will provide grant/project management, technical support , and community outreach and engagement. 2 .6 Previous REF Applications for the Project See Section 1.15 of the RFA for the maxi mum Qer Qroject cumulative grant award amount Round Title of a pplication Application Did you Am o unt of REF Submitted #,if known re ceive a grant awarded grant? Y/N ($) None I SECTION 3 -Project Management, Development, and Operation l 3.1 Schedule and Milestones Please fill out the sc he dul e be low (or atta c h a similar s heet) for th e wo rk co ve re d by thi s funding request. Be sure to identify ke y tas k s and decis ion points, inclu d in g go/no go decision s, in your project al o ng wi th e stimated sta rt and end dates for ea c h of the mile stone s a nd tasks. Please clearly identify the beginning and ending of all ph a ses (1. Re connai ss an ce, II. Feasibility and Concept ual De s ign , Ill. Final Desig n and Permitting , and IV. Construction) of your proposed project. See the RFA, Sec tions 2 .3-2.6 for the recomme nded mil es tones for e ach ph ase. Add additional rows as needed . Task Start End # Milestones Tasks Date Date Deliverables 1.1 Gra nt Ag ree ment in • Sig ned Ag reement pl ace 8/1/22 9/30/22 2.1 Co ntractor se lection • Develo p RFP for • RFP's with a detailed scope and awa rd engineerin g of services based o n syste m services , Geot ech , pe rformance need s. and perm itting • Final sig ned co nt racts technica l support • Fo rm se lecti o n co mmittee pe r N AB reg ulati ons an d se lect contract ors • Award Contracts 10/1122 11/30/22 2 .2 Confirma tion of syste m • Co nfir m PV , Batte ry • Detailed Scope of work compo nent sizi ng from and Conve rte r sizing HOMER m odeli ng, site recomm endat io ns contro l , an d develop fo r each community RF P fo r Eng in eerin g based on most recent AVE C 12/1/22 1 1/3 1/23 AEA 2300 1 Page 7 of 45 11/16/202 1 Renewable Energy Fund Round 14 Grant Application-Standard Form production data , fuel costs, and Capital costs. • Confirm solar array sitinQ locations. • 3.1 Final Design and • Provide technical Permitting support and facilitate community involvement in the design process. • Develop Designs and conduct design reviews at 65% and 95%. • Complete permit applications -NAB Title 9 Planning Permit; FAA Glint & Glare Review; confirm wetlands and floodplain avoidance; NEC compliance/PE, critical habitat, SHPO • Final acceptance of construction ready designs • stamps 3.2 Business Plan • Develop detailed cost estimate and fuel displacements for each community and conduct economic analysis. • Develop Ownership model and PPA with AVEC 4 .1 Grant Close-out • Prepare and submit final reports I 3.2 Budget 3.2.1 Funding Sources • • • • • • 2/1/23 10/31 /23 • • • • 8/1/23 10/3 1/23 • 11 /1/23 12/31 /23 ALASKA ENE RGY AUT HO RI TY Meetings notes from community engagement 65% and 95% design review notes Final permit applications Final acceptance letters Construction-ready design packages Detailed Cost Estimates Economic Analysis PPA Ownership model and O&M plan Submittal of final project report and close-out documentation Indicate the funding sources for the phase(s) of the project applied for in this funding request. Grant funds requested in this application $590,000 Cash match to be provideda $0 In-kind match to be provideda $34,000 Energy efficiency match _providedb $0 Total costs for project phase(s) covered in application (sum of $624,000 above) 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. AEA 23001 Page 8 of45 11/16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form ALASKA ENERGY AUTHORITY $17,756 of match will be provided by NAB in the form of in-kind for grants management , technical support. and community outreach and engagement for involving community champions in the design process . $16,244 in-kind match will also be provided by the NANA Regional Corporation (NRC) Energy Program for technical support and the development of the Business Plan . Both sources of match are already secured as both NAB and NRC have existing Energy Programs and staff that will devote their time to this project. NRC 's Letter of Commitment is included in the attachments. and NAB's commitment is in the Resolution . Additional funds would accelerate this project if they were sufficient to consummate construction, but the overall approach here is to aggregate/bundle projects to achieve economies of scale and cost savings, so a significant amount of additional funds would be necessary at this design and permitting phase. Once the projects are shovel ready-at the completion of this proposed phase of the project-then the aggregated construction budget will be levera_g_ed for all four projects. 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. NAB has 3 high penetration solar, battery, diesel hybrid systems in operation (Buckland, Deering , Shungnak) and has one system in the design and construction phase (Noatak). The NAB and NANA have also contributed funds and expertise to the high penetratio n solar PV array in Kotze bue . Based on this experience, we are confident in our cost estimates to complete the work. however, the pandemic has complicated the supply chain of engineering services. If there is a shortfall in funding, the communities will request additional funding through the NAB 's Village Improvement Fund, and the NRC Energy Program has also committed to providing additional resource s to fill any funding needs. The Village Improvement Fund is targeted for capital matching funds exclusively for NAB communities and has been successfully leveraged for all of the above projects and many others, resulting in the statewide leade rship around energy initiatives in the NAB/NANA region . 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] $0 Feasibility and Conceptual Design [Actual/Estimated} $ completed at no cost by ANTHC and DeerStone Consulting -see attachments Final Design and Permitting [Actual/Estimated} $624,000 Construction [Actuai!Estimatedl $8,712,850 Total Project Costs (sum of above) Estimated $9,336,850 - from HOMER modeling Metering/Tracking Equipment [not included in project Estimated $0 cost] 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 likel ihood of receipt of those funds. AEA 23 00 1 Pa ge 9 of 45 11 /16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form • State and/or federal grants • Loans, bonds , or other financing options • Additional incentives (i.e. tax credits) ALA SK A ENERG Y AUTHORITY • Additional revenue streams (i.e. green tag sales or other renewable energy subsidies or programs that might be available) Funding for the construction of the high penetration solar, battery, diesel hybrid systems will be required in future years. With the infusion of fund ing into Alaska from the Federal government, NAB, NANA, and the communities will be pursuing funding through the USDA High Energy Cost Grant Program , the Department of Energy-Indian Energy renewable energy programs, and the Denali Commission . The regional team is also closely monitoring new funding opportunities through the American Rescue Plan and any potential infrastructure funding . By bundling the construction of four projects as a package, NAB will also be pursuing New Market Investment Tax Credits that usually have a minimum project size of $5 million to participate in the program . Bundling the projects will allow NAB to reach the minimum size. We have also enlisted the support of Launch Alaska to assist with financing the full construction projects, which could take the form of leveraging tax credits, angel or impact investors, green tag or carbon credit sales, and/or conventional financing . The Red Dog Mine contributes a Payment in Lieu of Taxes (PIL T) to the NAB annually, which provides the majority of government revenue , including a recently created Village Improvement Fund (VI F) that invests in infrastructure and community development initiatives to promote the health and well-being of NAB residents and communities . VIF funds have been used in some communities to develop clean energy infrastructure and we expect that Ambler, Kiana , Noorvik, and Selawik will utilize VIF revenues to provide cost-share and leverage the construction of these projects along with managing any cost overruns. NANA also periodically provides funds to individual villages in the region that may be utilized as match for other construction funding of capital projects. 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, Ill. 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 , 1 'L-. , \' u 1 ', J. or by phone at (907) 771-3081 . Phase 3-Final Design and Permitting Source of Matching Anticipated Grantee Funds: RE-Fund Cash/In-Milestone or Task Completion Grant Funds Matching kind/Federal TOTALS Date Funds Grants/Other State Grants/Other (List milestones based on $ $ $ phase and type of p roject. AEA 23001 Page 10 of45 11116/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form See Sections 2. 3 thr u 2. 6 of the RFA) Grant Agreement in place $ Contractor se lection and $10 ,000 award Final Desiq n and Permittinq $533,456 Confirmation of system component sizing fro m HOMER mode ling , site control , $41 ,544 and develop RFP for Engineering Business Plan $ Grant C lose-out $5000 $ $ $ $ $ TOTALS $590 ,000 Budget Categories: D ire ct L abor & Benefits $ Travel & Per Diem $ Equipme nt $ Materials & S upp li es $ Contractual Services $590 ,000 Construction Services $ Other $ TOTALS $590,000 3.2 .4 Cost Justification $1000 In-kind $6000 In-kind $5000 In-kind $3756 In-kind $16,244 Other $2000 In-kind $ $ $ $ $ $34 ,000 $17 ,756 $ $ $ $ $ $16 ,244 $34 ,000 ALASKA ENERGY 1\UTHORITY $1000 $16 ,000 $538,456 $45 ,300 $18,244 $5000 $ $ $ $ $ $624 ,000 $ $ $ $ $ $ $ $624 ,000 Indicate the source(s) of the cost estimates used for the project budget, including costs for future phases not included in this application. The design costs estimate for this project was comp leted by the NAB project team based on recent experience from the design and installations of the h igh penetration projects in Deering, Buckland, Kotzebue , Shungnak , and Noatak, and with input from design and constructions partners on previous projects including Hitachi (formerly ABB) and Ala s ka Native Renewable Industries. Anticipating an eco nomy of scale with the design of four systems, we reduced the anticipated cost of individual designs by about 30%. See the detailed capital budget in the Appendix. I 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? Progress will be measured based on a project charter with a timeline, milestones , and a responsibility matrix to identify deficiencies before they impact project deliverables. We will also have quarterly project meetings that include the AEA project manager to ensure tasks are being performed according to the agreed-upon timeline and budget. The NAB Project Manager will provide quarterly progress reports to NAB leadership and AEA that will detail the progress versus plan and any remediation plans to address deficiencies . Our intent is to include the AEA project manager as an active member of our design team to incorporate their knowledge and experience in the successful project. NAB and NRC Energy Project Managers will be in regular contact with AE A 23001 Page 11 o f 45 11/16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form ALASKA EN ERGY A UTH ORITY each other, the communities, and AVEC, as they already have activities in all the region 's communities, and this will facilitate status monitoring I 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 . The NAB Finance Department consists of a treasurer, controller, accounting assistant, and specialized contractor. The Finance Department utilizes Caselle accounting software . This is a fund accounting platform that is used by over 1,200 municipal, county, and service districts nationwide and is used to provide monthly financial reports to the Borough Assembly and track all expenditures and revenues. The NAB undergoes a financial statement and single aud it annually. Our Finance Department will manage all financial transactions associated with the grant and will be responsible for monthly financial reporting to the NAB Mayor and Assembly and quarterly financial reporting to AEA and other project partners. Current financial statements and other financial information are available upon request. The NAB Finance Department is very familiar w ith state and federal grants and manages millions of dollars annually. In accordance with NAB policy, when a project is funded, an account and object account code is created to track all materials and time related to that project. This is organized so that matching and grant funds are properly accounted for. The grant agreement is reviewed in detail with the accounting team at the beginning of the project to ensure that only eligible and reasonable costs are billed to the grant. From a procurement standpoint, NAB will select contractors following all NAB and federal procurement rules, including those found in 7 CFR part 1709 and 2 CFR part 200. NAB will be seeking contractors that have demonstrated success, expertise, and commitment to this type of project in our region and its unique circumstances. I 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. Ingemar Mathiasson, NAB Energy Manager, works within the NAB 's Economic Development Department. He will be the Project Manager and oversee all aspects of the project. He has developed and managed renewable energy and energy efficiency projects in all 11 communities within the Borough and has been the Project Manager for successful solar, battery, and diesel hybrid systems in Buckland , Deering, Shungnak, and Noatak, along with biomass construction project in Ambler. Mr. Mathiasson will also ensure community engagement and outreach in all AEA 2 3001 Pa ge 12 of 45 11 /16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form ALASKA EN ERGY AUTIIORilY villages . This will be coordinated with the Northwest Arctic Energy Steering Committee education and outreach efforts for the region . Mr. Mathiasson can be reached at 907-445-2031 and imathiasson@nwabor.org 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. Angie Sturm has been the NAB Treasurer since 2016 . Ms. Sturm received her Bachelor of Business Administration degree in Accounting and Management from the University of Alaska Anchorage. Before accepting her position at the Borough , Angie was an Auditor for KPMG , LLP- an international accounting firm with offices in An c horage . She will oversee all f inancial transactions and financial reporting associated with this project, providing appropriate information to AEA the NAB Assembly and Mayor. I 4.1.3 Expertise and Resources Describe the project team including the applicant, partners , and contra ctors. 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 c apacity to successfully select contra ctor s and manage complex contracts . Ingemar Mathiasson -NAB Energy Manager since 2009. Originally from Sweden , Mr. Ma t hia sson has lived in Ala s ka since 1987. He built and live s in an off-the-grid homestead outside of Ambler, complete with wind and solar power, batteries , and biomass for heating . He is a member of the Board of Directors of the Renewable Energy Alaska Project (REAP) and has overseen more than $15 million of renewable energy construction projects around the Borough in all 11 communities . He will be the main Technical Contact on this project and will report to the NAB Economi c Development Dire ctor and the Finance Department. He will manage the subcontractors and coordinate communication with all project partners. Mr. Mathiasson will be the key contact for design contractors and will lead the business plan development and community education and outreach in all villages . Outreach work will be coordinated with the Northwest Arctic Energy Steering Committee (NAESC) education and outreach efforts for the region . The NAESC is a regional collaborative that has been leading the development of energy plans for more than 12 years in the NAB, guided by the goals of reducing energy costs and improving energy resilience as the top priorities of the region . Sonny Adams -NANA Regional Corporation (NRC) Director of Energy Programs . Mr. Adams has been involved in all aspects of village energy development with NANA communities s ince 2007 . He has served on the US Department of Energy "Indian Country Energy and Infrastructure Working Group" and is currently managing the USDA HECG solar-wind-battery-diesel integration projects in Buckland and Deering. Mr. Adams, a NANA shareholder originally from Kotzebue, has a Bachelor of Science in Metallurgical and Materials Engineering from the University of Montana . He will continue to lead NANA's contribution on this proposed initiative through collaboration with all project stakeholders especially in relation to the IPP , training and techni ca l assistance , co mmunity outreach and education , contractor support, and leadership within the NAESC. AEA 23 001 Pa ge 13 of 45 11 /16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form ALASKA ENERGY A UTHORITY Brian Hirsch -DeerStone Consulting Founder and CEO . Dr. Hirsch worked in rural Alaska and other remote locations on diesel-based renewable energy microgrids for over 25 years. Prior to founding DeerStone, he served as an elected Board Member for Homer Electric Association, the rural Electric Cooperative in his Alaska community; led the National Renewable Energy Laboratory's Alaska Initiative for over six years; worked across Southeast Asia, Canada, lower 48 US, Mexico, and Central America ; and consulted for numerous non-profits and Tribal organizations . He has a PhD in Natural Resources with a Master's Certification in Energy Analysis and Policy from the University of Wisconsin-Madison and a bachelor's degree in GovernmenUPolitical Science with three years of Electrical Engineering coursework from Cornell University. DeerStone Consulting will continue to provide technical support to this project under NRC. Project support will focus on the solar installation , battery and grid integration, and build ing community capacity to manage projects in addition to developing the financial and organizational structure for the IPP agreement. Leah Lansdowne is a licensed Mechanical EIT, who completed her bachelor's in Mechanical Engineering with a focus on renewable energy at the University of New Haven in Connecticut in 2019 and holds a prior bachelor's degree in Chemistry from Williams College . At DeerStone, she has experience with microgrid controls , wind and solar productio n optimization , system troubleshooting , telecommunications, the development of community energy action plans, and system feasibility. Leah also has experience in reliability engineering , working with asset management systems to develop and maintain maintenance records for the manufacturing facil ity of a multinational pharmaceutical company in Bend , Oregon. She has also worked at municipal utilities, includ ing the City of Bend Water Department, where she worked with water plant operators to develop operational guides for the City water system . Her project management experience includes lead ing a team of peers to design an air-filtration system for use in NASA spaceships . She is proficient in Blue Mountain Regulatory Asset Manager (CMMS), Solidworks, and Hach WI MS. Her previous professional endeavors include commercial fishing and natural building construction. Engineering and Permitting support firms will be selected through a competitive procurement process and will be selected based on their experience and technical expertise with s imilar projects in remote Alaska . A scoring matrix will be developed during the procurement process , and the AEA project manager will be invited to participate on the selection team . 4.2 Local Workforce Describe how the project will use local labor or train a local labor workforce. As with the recent solar PV projects that have been completed in NAB, local labor and capability development will be a significant goal. The Shungnak high penetration solar and battery system was constructed with a crew made up of about 90% local and Native members. We plan on utilizing this experienced regional labor force on future construction proj ects and will actively train additional crews in the solar PV installation skills . Additionally, sustainability education and hands-on solar trainings will also be provided for community members for future installation of the systems , in addition to the training provided to locally hired laborers . This workforce training is already incorporated in other related projects we are implementing including the upcoming Noatak high penetration solar PV and battery system. Energy community champions have already been engaged in energy development through the NAESC, and these champions will be engaged during the design process to e xpand their energy education and provide community specific feedback on the designs . We will also use this project AEA 2300 1 Page 14 of 45 11/16/2021 Renewable E ne rgy Fu nd Roun d 14 Grant Application-Standa rd Fo rm ALASKA ENERGY AUTHOr~ I fY as an opportunity to recruit new energy champions and develop our next generation of NAB energy leaders. I SECTION 5-TECHNICAL FEASIBILITY I 5.1 Resource Availability 5.1 .1 Assessment of Proposed Energy Resource Describe the potential ex tent/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 des ign and permitting or construction projects , please provide feasibility documents, des ign documents , and perm itt ing 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 Che cklist for additional guidance . The follow ing figure of Solar Insolation in Alaska was developed for the report "Solar Energy Prospecting in Re mote Alaska -An Econo mic Analysis of So lar Photovoltaics in t he Last Frontier State" by Paul Schwabe , National Renewable Energy Laboratory U.S. This report shows that the Arctic and Interior regions of Alaska could e x pect high solar production predominantly from March through August, with a steep drop off in the shoulder months and little to no product ion in the winter. Most communities in the NAB a have an estimated value of 3.4 kWh/m2/Day for solar insolation . Operating projects in Deering and Buckland are performing with a capacity factor of almost 11%. Other e xisting solar PV projects in the region have affirmed the solar resource availability and capacity factor value . AEA 2300 1 Page 15 of 45 t 1/16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form > 4 .0 3.7) to 4.0 3.5 rc 3.75 1.!"> to 1S 3.0 IC 3.25 ?.7 5 to 3.0 J 2.50 to 2.75 VS to 2.50 < 2.2 5 " 5.1.2 Alternatives to Proposed Energy Resource :· ,,, ALASKA ENE RGY AUTHORITY "' 1 l , •trr 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. Energy planning has been at the forefront of the NAESC's objectives during the last 10 years of its existence. In that time , the region has installed many energy systems including heat recovery systems, heat pumps, wind turbines , behind the meter solar systems , community scale solar and battery systems, and wind, solar PV, battery, and diesel hybrid systems, along with develop ing the first Power Purchase Agreement with AVEC. We have also focused on feas ibility studies of interties between communities and potential hydroelectric projects . The region has been very active in energy efficiency improvements. One of our key learnings is that solar PV is a good first step for a community into operations and maintenance of renewable energy systems . It is the easiest technology to maintain as the communities learn the requirements of operating and maintaining energy systems along with partnering with incumbent utilities . AEA 23001 Page 16 of 45 11 /16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form A LASKA ENERGY 1\UTHORI~Y For this project, 8 different options were considered and evaluated based on our primary goals to reduce the reliance on expensive diesel fuel and the costs of generating electricity in our communities : • Option 1: Do nothing • Option 2 : Do minimum, Grid-tied Solar Power (up to utility limit) • Option 3: Install a Solar Photovoltaic (PV) Array with a Battery Energy Storage System • Option 4: Energy Efficiency • Option 5: Biomass • Option 6: Powerline lnterties between communities • Option 7 : Wind Turbines Option 1 was eliminated because doing nothing will not reduce our reliance on diesel. Option 2 was also eliminated because of our desire to achieve significant diesel re ductions and to work with our partner AVEC and the utility limit with low penetration is only a minimal amount of renewable production or fuel savings . Option 4 will continue to be a priority within our communities with a focus on energy efficiency improvements for heating systems . Most impactful electrical energy efficiency improvements have been completed in our communities. Regarding Option 5 , biomass systems have been installed in Ambler and Kobuk, our two communities with good wood resources . Feasibility studies for wood heating in other NAB communities have not resulted in recommended systems. Options 6 and 7 are still under consideration for a future intertie between Noorvik and Kiana that could be coupled with a wind system. This project is still in the pre- feasibility stage and will not be ready for design and construction for many years . Wind turbines in the other communities are a lso not viable at this time . A Solar PV, Battery, Diesel Hybrid System was the most logical project for Ambler, Kiana , Noorvik, and Selawik community scale renewable energy systems at this tim e, and combining the projects was determined to provide sign ificant additional cost savings . 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 app ropriate 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 The following permits are required for a Solar PV installation: • NAB Title 9 Planning Permit • FAA Glint & Glare Review if potential interference with aviation traffic • Analysis of wetlands and floodplain avoidance • NEC compliance/PE stamps • Consultation with State Historica l Preservation Office • Critical Habitat avoidance The permitting consultation s and applications will start as soon as the locatio ns of the PV arrays are finalized . The permitting is expected to take 6 months to complete and is shown in the project timeline . Contractors with appropriate expertise will be selected through a competitive RFP process to lead the pursuit of these permits. NRC also has engineering subsidiaries who can help, in AEA 2300 1 Page 17 of45 11 /16/20 21 Renewable E nergy F u n d Round 14 Grant Application -Stan dard Form ALASKA ENERGY A UTH ORITY particular with the analysis of wetlands and floodplain avoidance , as they work on similar issues for the Red Dog mine in the region. 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. Preliminary sites were identified during the feasibility phase of the project and land ownership was researched . Two to three locations were identified in each community that will meet the needs to support the installation of solar arrays from a size , soil condition constructability, ownership, location near power lines, r;ninimal obstruction, and permitting standpoints. It is expected that there will be no additional site control needs for power line access. The site locations will be f inalized as one of the first critical path tasks of the design phase of this project and will include public input into the selection process. Because of Covid , the site selection has been delayed in terms of in-person community meetings . All identified sites are owned by either NRC, individual City government for the proposed project, or AVEC . All of these entities are supportive of the proposed project and have submitted letters of support that will allow for site control of the eventual locations. Most of the other solar PV projects in the region have utilized NRC lands. j 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 c hallenging? • How w i ll the project team reduce the risk of these tasks? • What internal controls will be put in place to limit and deal with tec h nical risks? See the "Common Planning Risks" section of the appropriate Best Practice Che ckl ist for additiona l guidance. NAB does not foresee any maj or technical risks for completing the Final Design and Permitting of this project. The main technical aspects and potential challenges of final construction of these projects will be considered in the design process and include: 1) Permafrost soils supporting ground mounted racking for solar PV panels; 2) Integration of battery energy storage system , power conversion system for grid forming inverter, and system controls/dispatch ; and 3) Challeng ing logistics in a remote location. All of these issues have been addressed and resolved in similar projects in nearby communities, but each project has unique si te-specific c ircumstances. All of the proposed equipment for this project is commercialized technology. Act ual systems for consideration must be "flight proven" through s uccessful installations, ongoing co mmercial performance in comparable field conditions , and covered by well established companies providing commercial warranties . To control these risks, the project team will conduct thorough geotechnical analysis of the s iting locations to minimize impact to permafrost. The team will apply lessons learned from recent similar installations and include extended commercialization technical support in vendor contracts to assure that the integration control systems are optimized . The project team wi ll address the challenging remote logistics by hiring ex perienced construction contractors and planning e xtra time in the project schedule to allow for logistical issues . Another technical risk in the past that has been successfully addressed is electrical integration of new equipment into legacy infrastructure. This has been resolved with AVEC infrastructure through upgraded switchgear and generator controls , and these lessons w ill be applied to the proj ects AEA 2300 1 Page 18 of45 11/16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form ALASKA ENE RG Y AU T HOR I ~Y proposed here. Specifically, the solar PV and battery hybrid system recently installed in Shungnak, and the one soon to be installed in Noatak, are designed to work with AVEC 's switchgear and ComAp generator controllers , and any future microgrids will be required to be compatible with this hardware and software . We have been particularly impressed with the performance of the Ageto microgrid controller and its compatibility with AVEC 's switchgear and generator controls. We would expect similar hardware and program software for future systems. 5.3 .2 Environmental Risk Explain whether the follow ing 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 Practi ce 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 The initial environmental survey in the feasibility phase of the project did not identify any serious concerns . Permit applications will be a deliverable of this project scope and will address the following areas: • Threatened or Endangered species· The U.S. Fish and Wildlife Service will be consulted to ensure that the construction of the PV panels will have no harmful impact on threatened or endangered species . • Habitat issues-During the permitting process , the project team will consult with the required agencies to avoid any impact to critical habitat, refuges , wilderness areas, and other sanctuaries. • Wetlands and other protected areas -The Corp of Engineers will be consulted on any need for wetlands permits or remediation. • Archaeological and historical resources -The State Historic Preservation Office will be consulted for complia nce with the National Historic Preservation Act during the design process . • Land development constraints -Site control will be a key deliverable of this project. • Telecommunications interference-No potential issues identified . Any concerns will be addressed in the project design. • Aviation considerations -Consultation with the Federal Aviation Administration will be required for a Determination of No Hazard to Air Traffi c. • Visual, aesthetics impacts -Community meetings will be conducted to discuss visual impact concerns for each location . • No other potential barriers have been identified. 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 . AEA 23001 Page 19 of45 11/16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form 5.4.1 Basic Operation of Existing Energy System ALASKA EN ERGY .A UTH O RIT Y 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. The existing diesel power plant in Ambler consists of three generators: a 363 kW Detroit Diesel Series 60, a 271 kW Cummins K19G2, and a 397 kW Cummins K19G2. These generators were installed in 2002 , 1993, and 1990 respectively. Aggregate generator efficiency in Ambler in 2020 was 12 .66 from the annual PCE report. The peak load in 2020 was 260 kW with an average load of 142 kW. Spinning reserve is provided by a second gen-set, and there are currently no voltage, current, or recurring outage issues within Ambler. The existing diesel power plant in Kiana consists of three generators: a 324 kW Detroit Diesel Series 60, a 363 kW Detroit Diesel Series 60, and a 499 kW Cummins K19G2 . These generators were installed in 2020, 2019, and 2000 respectively. Aggregate generator efficiency in Kiana in 2020 was 14.4 kWh/gal from the annual PCE report. The peak load in 2020 was 337 kW with an average load of 194 kW . Spinning reserve is provided by a second gen-set, and there are currently no voltage, current, or recurring outage issues within Kiana . The existing diesel power plant in Noorvik consists of three generators: a 363 kW Detroit Diesel Series 60, a 499 kW Cummins K19G2, and a 710 kW MTU. These generators were installed in 1997, 2016, and 2003 respectively . Aggregate generator efficiency in Noorvik in 2020 was 13.78 kWh/gal from the annual PCE report. The peak load in 2020 was 329 kW with an average load of 228 kW. Spinning reserve is provided by a second gen-set, and there are currently no voltage , current , or recurring outage issues within Noorvik. Noorvik also has a small 23 kW solar array installed. The existing diesel power plant in Selawik consists of three generators: a 499 kW Cummins QST, a 499 kW Cummins QSX, and 900 kW Cummins K38G4. These generators were installed in 2020, 2019, and 2014 respectively. Aggregate generator efficiency in Selawik in 2020 was 13.85 kWh/gal from the annual PCE report. The peak load in 2020 was 612 kW with an average load of 319 kW. Spinning reserve is provided by a second gen-set, and there are currently no voltage , current, or recurring outage issues within Selawik . 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 e xtra tables . If you have the data below in other formats , you can attach them to the application (see Section 11 ). 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 Please refer to the attachment AVEC Fleet information for Ambler, Kiana, Noorvik, and Selawik. Is there operational heat recovery? (Y/N) If yes estimated annual displaced heating fuel (gallons) AEA 23001 Page 20 of 45 Yes-Noorvik -18,600 gal , Selawik- 9,200 gal, Ambler-8,800 gal, Kiana- 4,500 gal. There will be small impacts 11 /16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form ALASKA ENERGY AUTHORilY y., 5.4.2 .2 Existing Distribution System d u ri ng the shoulder seasons t hat will be quantified d u ring the design phase. These projects are not expected to have significant impacts to the heat recovery systems because the majority of diesel-off ti me will be during the summer months. 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. All four d istribu tion systems are very similar in the communities. Ambler, Kiana, Noorvik and Selawik all generate at 496 V and step up to 7200 V for distribution . The following information su mmaries the transform e rs in each community: Ambler -switch 1: 3 ea 75kVA, switch 2: 3 ea 50kVA, switch 3: 3 ea 75 kVA Kiana-switch 1: 3 ea 75kVA , switch 2: 3 ea 100 kVA, switch 3: direct 496V feed to waste treatment plant Noorvik-switch 1: 3 ea 100 kVA, switch 2: 3 ea 37 .5 kVA, 1 ea 100kVA listed as spare Selawik -breaker 1: 3 ea 167kVA, breaker 2: 3 ea 167kV A, breaker 3: 3 ea 75kVA, 3 ea 100 kVA at wind turbine site 5.4.2.3 Existl!!.g Thermal Generation Units _(jf a ol!_/icable to lfour project) Generation Resource/ Design Make Model Average Year Hours unit Fuel type capacity annual Installed (MMBtu/hr) efficiency N/R 5.4.2.4 O&M and replacement costs for Po w er Generation Thermal exi sting u n its Generation i. Annu al O&M cost for labor Pos tage stamp Rate -$140 ,000 per Power Plant for Labor and non- labor ii. Annual O&M cost for non-labor See above iii. Replacement schedule and cost for O il Change at 500 hrs-$140 ex isting un its Tune-up at 3000 hrs-$2400 Top end at 10,000 hrs -$8600 Overhaul at 20,000 hrs -$40- 55 ,000 Replacement at 100,000 hrs See attachm ents for details AEA2300 1 P age 21 of 45 11116/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form ALASKA ENERGY AUTI~OR I TY I . Use most recent year. Replace the section (Type 1 ), (Type 2), and (Type 3) with generation sources ------------------------------------------ Ambl e r Generatio Generatio Generatio Fuel Fuel n (Diesel n(Type n(Type Consump Consump Peak Minimum Month Genset) 2) 3) tion tion Load Load (kWh) (kWh) (kWh) (Diesel-[Other] Gallons) January 137,457 9 ,540 212 162 February 123,478 8 ,803 260 163 March 129,271 9 ,245 244 14 8 April 104,075 7,684 215 131 May 83,241 6 ,515 207 105 June 79,176 6 ,283 176 93 July 68,919 5,553 158 89 August 84,054 6 ,658 190 98 September 88,150 6 ,697 124 109 October 99,546 7,150 223 122 November 120,6 54 8,398 241 136 December 134,688 17 ,6 29 220 154 Total 1 ,252,709 100,155 Kiana Generatio Generatio Generatio Fuel Fuel n (Diesel n(Type n(Type Consump Consump Peak M inimum Month Genset) 2) 3) tion tion Load Load (kWh) (kWh) (kWh) (Diesel-[Other] Gallons) January 189,494 14 ,252 329 228 February 164,673 12 ,740 282 208 March 159,942 12,111 245 185 April 135,549 10 ,886 215 163 May 106,340 7,737 177 135 June 107,615 7,854 166 129 July 100 ,225 7,451 187 107 August 114,121 8,293 172 134 September 122,230 8,887 280 153 October 139 ,240 10,099 273 15 7 November 160,493 11 ,029 337 192 December 183,6 56 3,138 265 21 8 Total 1,683,578 114,477 Noorvik AEA 23001 Pa ge 22 of45 11/16/2021 Renewable Energy Fund Round 14 Grant Applic ation-Standard Form Generatio Generatio Generatio Fuel n (Diesel n (Solar n(Type Consump Month Genset) PV) 3) tion (kWh) (kWh) (kWh) (Diesel- Gallons) January 215,836 68 15,093 February 205,870 493 14,380 March 199,891 1,557 14,201 April 152,091 1,851 10,572 May 124,626 2,205 8,662 June 120 ,638 2 ,132 9,122 July 114,173 1,423 8 ,036 August 128,387 1,519 9 ,054 September 140,052 699 9,600 October 163,106 321 11 ,315 November 192,480 87 14,378 December 215,356 1 18,007 Total 1,972,506 142,420 Selawik Generatio Generatio Generatio Fuel n (Diesel n(Type n(Type Consump Month Genset) 2) 3) tion (kWh) (kWh) (kWh) (Diesel- Gallons) January 355676 25,179 February 326486 22,687 March 319556 22,977 April 246344 18,468 May 168962 12,682 June 152206 12,213 July 149014 11 ,359 August 185033 13,893 September 187692 14,090 October 230110 17,941 November 287380 20 ,397 December 295905 16,399 Total 2,904 ,36 4 208 ,285 5.4.3 Future Trends Fuel Consump Peak tion Load [Other] 329 284 215 190 184 2 12 206 247 263 295 280 296 Fuel Consump Peak tion Load [Other] 612 563 565 421 277 265 290 259 322 457 451 486 ALASKA ENER GY ,\UTHORITY Minimum Load 262 269 223 186 15 0 144 148 159 168 195 223 243 Minimum Load 428 430 353 27 1 199 197 188 199 237 256 317 376 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. AEA 23001 Page 23 of 45 1 1/16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form ALASKA ENER G Y AU T HORITY Population trends in the region have been relatively stable since the 201 0 census. The population of Amber has increased by 1.55%, and the population of Kiana has increased by 7.48%. Selawik's population was stable, and Noorvik's population decreased by 1.95%. Because of these population trends , electric usage is not expected to change significantly. High energy costs have led to a focus on energy conservation , and th is is not expected to change without significant reduction in energy costs. While this project will slightly reduce rates, it is not expected to reduce rates enough to change usage behaviors . As a result, significant load growth is not expected in any of the impacted communities. The NAB has been supporting the installation of heat pumps in residential and community buildings throughout the region for the last 5 years . To be cost effective for consumers, these systems must be managed so electrical usage stays within the 500 kWh per month PCE allotment. Because of the ease of operations and maintenance of solar PV systems, high penetration solar PV, when seasonally available, will continue to be the technology of choice for interior communities without large hydroelectric or wind resources . 5.4.4 Proposed System Design Provide the following information for the proposed renewable energy system : • A description of renewable energy technology specific to proj ect 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 Pra ctice Checklist for additional guidance. The proposed project is a high penetration distributed solar-battery hybrid system that will be connected to the local village electric grid . Each system will be sized to maximize the diesels-off potential during the months of highest solar availability using HOMER software . The feasibility modeling has identified the following PV array sizes for each community. The sizes of this equipment will be optimized in the final design . Excess solar generation was not included in the analysis. Community Solar PV (Kw) Power Battery Energy Conversion Storage (kWh) System (kVA) Ambler 390 500 384 Kiana 319 500 384 Noorvik 369 500 384 Selawik 430 750 384 The core component of each system will most likely be an ABB or Ageto supervisory microgrid controller with power electronic inverters and controls, cou pled with a lithium-ion battery, that will allow for periods of diesels-off operation when there is sufficient solar energy production and /or adequate charge in the batteries to safely run the entire grid. In our case , this will most frequently occur for hours at a time between April and August, when there is significant solar availability and AEA 23001 Page 24 of45 11/1 6/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form ALASKA ENERGY AUTf IORITY the total system loads decrease because of warmer temperatures , less need for electric lighting , and the local schools close for summer. An ABBe-mesh PowerStore is shown below . It is a compact and integrated platform with racks that accommodate various battery manufacturers, a single temperature control , and fire suppression package to reduce overall installation costs. For each community project, the system grid controls for diesel generators, solar PV, batteries , and load feeder are controlled by this system . This is a sample of what could be installed subject to competitive selection. PowerStore•w Integrated 250/500 Leveraging experience with similar hybrid systems within our region and elsewhere around Alaska , this equipment is specifically designed for small isolated microgrids like that found in NAB. Over the last several years, ABB and Ageto have provided similar "grid-forming" inverters with batteries that allow for diesels-off operation in numerous remote microgrids around Alaska and elsewhere, including in nearby Deering , Buckland and Shungnak. Kotzebue Electric Association has ABB equipment in its powerhouse and local expertise and familiarity with the equipment for regional support. Though the core power conversion technology is well proven, the supeNisory controllers are continually improving their programming based on growing experience with micro-grids, especially their expertise in remote locations across Alaska , Canada, and Australia. Fiber optic or other digital communications will be utilized to insure proper integration and monitoring between the solar, battery, and diesel generation assets. 5.4.4.1 Proposed Power Generation Units Unit# Resource/ Design Make Model Expected Expected Expected Fuel type capacity capacity life Availability (kW) factor (years) Ambler Solar 390 TBD TBD 11.2% 25 95% Kiana Solar 297 TBD TBD 10.9% 25 95% Noorvik Solar 358 TBD TBD 10.9% 25 95% Selawik Solar 398 TBD TBD 10.8% 25 95% AEA 23001 Page 25 of 45 11/16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form 5.4.4.2 Pro~osed Thermal Generation Units (if a pl{cable) __ Generation Resource/ Design Make Model unit Fuel type capacity (MMBtu/hr) N/A ·- 5.4.5 Basic Operation of Proposed Energy System Expected Average annual efficiency ALASKA ENERGY AUTHORITY Expected life : : • 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 add itiona l guidance . The operation of these high penetration solar PV, battery, and diesel hybrid systems will be controlled by a microgrid system integrator. The concept of "system integration" essentially means overlaying new digital technology on top of a legacy islanded diesel grid and ensuring that the diesel backbone is fully supported. This requires a supervisory controller to continually monitor the entire system load to determine the optimal combination of solar PV, diesel generation , and battery power necessary to meet the load with the least amount of diesel generation but also ensure that the diesel generator, when running, is at least 30% loaded relative to its generation capacity to provide grid stability and avoid wet stacking to protect the diesel generator. Other operating constraints include maintaining battery state-of-charge (SOC) typically between 20-80 % of total capacity, considering spinning reserve requirements on the diesel generator, and trying to minimize curtailment of solar output. For example, in a community if the system load is 200 kW, the smallest diesel is 315 kW, the solar PV is producing 180 kW and the batteries are 20% charged, the supervisory controller would send a signal to turn on the 315 kW diesel generator to meet the remaining 20 kW of system load but it would also need to run at higher than 20 kW output. In fact, the diesel generator would have a low-load setpoint so it could not produ ce power at a rate less than 94.5 kW (30% of its nameplate rating of 315 kW). The excess power, abo ve and beyond the 20 kW required to meet the system load, would go to charge the batteries. If the system load stayed at 200 kW and the solar PV output stayed at 180 kW , once the batteries were charged to 80% of their capacity, then the supervisory controller would send a signal to turn off the diesel generator and meet the entire system load with a combination of solar PV and battery output. When the batteries dropped in charge, it would dispatch the diesel generator to meet the difference. It should be noted that the supervisory controller-the "brains" of the operation-does not di rectly communicate with any of these generation assets , but rather rece ives inputs, and sends outputs, to the solar inve rter, the diesel powerhouse switchgear and generator controls, and the battery management system (BMS), and then these units control the generation assets. This requires digital compatibility among all parts of the system and a pathway for all of the system components to communicate d igitally, which can be done through fiber, ethernet, or wirelessly, depending on AEA 23001 Page 26 of 4 5 11 /16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form ALASKA ENERGY AUTHORITY the circumstances . Typically, if the assets are located near each other, fiber or ethernet is preferred , but in some cases , such as when wind turbines or solar PV arrays are relatively far from the power plant, wireless communications are necessary. AVEC is in the process of updating the diesel powerhouse switchgear and generator controls for all of their communities, which is an essential requirement for proper digital communication and system control. We have been talking c losely with AVEC to ensure that their new equipment will be digitally compatible with industry leading power electronics , especially those that are already installed in the region such as SMA and SolarEdge inverters and optimizers, Woodward easYgen and ComAp diesel generator controls, Saft and BluePianet BMS's, and ABB and Ageto supervisory microgrid controllers. 5.4.3.1 Expected Capacity Factor 10.8% to 11 .2% 5.4.5.2 Annual Electricity Production and Fuel Consum~tion (Proposed System) -AMBLER Month Generation Generation Generation -JFuel Fuel Secondary Storage (Proposed (Type 2) (Type 3) Consumption Consumption load (kWh) System) (kWh) (kWh) (Diesel-[Other] (kWh) (kWh) Gallons) January 632 TBD in February 6392 Design ··- March 26412 Phase April 51977 May 67863 June 73868 July 67863 August 47391 September 27273 October 12006 November 2324 December 0 Total 384001 5 .4.5.3 Annual Electricity Production and Fuel Consumption (Proposed System)-Kiana ··-Month Generation Generation Generation Fuel Fuel Secondary Storage (Proposed (Type 2) (Type 3) Consumption Consumption load (kWh) System) (kWh) (kWh) (Diesel-[Other] (kWh) (kWh) Gallons) January 483 TBD in February 5055 Design March 20169 Phase April 38849 May 48058 June 53511 July 50470 August 35898 September 21199 AEA2300 1 Page 27 of 45 11 /16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form --=----:--Oct o b er 9071 November 1868 December 0 Total 284632 ALASKA ENERGY AUTHORITY -- ~.4.5 .4 Annual Electricity Prod_uc!ion and Fuel Consumption (Pr~~sed System] -Noorvik Mo nth Ge neration Generation Generation Fue l Fuel Secondary Storage (Proposed (Type 2) (Type 3) Consumption Consumption load (kWh) System) (kWh) (kWh) (Diesel-[Ot her] (kWh) (kWhl Gallons) January 578 TBD in February 5951 Design March 24159 Phase April 46648 May 58607 June 64547 July 60572 August 43001 September 25394 October 10866 November 2125 December 0 -Total 342449 I 5.4.5.5 Annual Electri cit~ Production and Fuel Consumption (Prop osed S~stem) -Selawik Month Gene ration Generation Generation Fuel Fuel Secondary Storage (Proposed (Type 2) (Type 3) Consumption Consumption load (kWh) System) (kWh) (kWh) (Diesel-[Other] (kWh) (kWh) Gallons) January 640 TBD in February 6700 Design March 26732 Phase April 51491 May 63696 June 70924 July 66893 August 47 580 September 28097 October 12023 November 2476 December 0 Total 377253 I 5.4.6 Proposed System Operating and Ma intenance (O&M) Costs AEA 23001 Page 28 of 45 11/16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form ALASKA ENE RGY AUT HORITY 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. $ I-0-'-I..L...:..plti....:.o-'-n-'2::..:....:.D....:.i'-'-e-'-s-'-e-'-l Q..._le.:...n;..;.e.:....:r....:.a:..:.ti:....:o...:..n....:.O.::....::....F.:....F _____ --l The O&M estimates were developed using the For projects that will result in shutting down AEA 8/C ratio model. The table summarizes the diesel generation please estimate: results for each community: 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. Community Non-Estimated Annual fuel Hours O&M Savings Savin~s Ambler $1500 2060 $20 ,489 Kiana $550 735 $6 ,870 Noorvik $550 729 $7,251 Selawik $145 19 3 $2,929 The non-fuel savings include the O&M savings in the above table show the savings in diesel replacement costs. This savings is calculated using the diesels off hours, typical life of the AVEC gensets (100 ,000 hrs .), and estimated gen-set replacement cost ($75,000). See the Replacement cost details in the Attachments . The O&M Savings are pulled directly from AEA's 8/C ratio model. This application takes a slightly different approach from the estimated O&M costs from the AEA recommended rule of thumb of 2% of capital cost for Solar PV projects. This 2% is the same recommended estimate for wind projects, and ex perience in NAB and other regions of Alaska has shown that Solar PV O&M costs are significantly less than wind projects. For our estimates, we use 1% of the battery capital cost for the battery system O&M . Industry rule of thumb for Solar PV O&M costs including panels and inverters and associated equipment is $10-$20 per year per installed kW . We used $20 per installed kW for a conservative estimate. Please refer to the O&M Costs in the attachments for full O&M calculations . ABA 2300 1 Page 29 of45 11/1 6/202 1 Renewable Energy Fund Round 14 Grant Application -Standard Form 5.4.7 Fuel Costs ALASKA ENE RG Y AUTHORITY Estimate annual cost for all applicable fuel(s) needed to run the proposed system (Year 1 of operation) Diesel Electricity (Gallons) Unit cost N/R (!) Annual Units Total Annual cost $) - 5.5 Performance and O&M Reporting For construction projects only 5 .5.1 Metering Equipment Propane Coal Wood Other (Gallons) {Tons 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. If this project proceeds to construction. each system will be designed with metering equ ipment that will allow the operator to understand solar PV production , power flowing into and out of the battery, and battery system station service including HVAC and battery round tri p efficiency. This metering equipment is standard for all high penetration solar PV, ba ttery, diesel hybrid systems and will be included in the cost of the construction phase of the project. Typical meters cost about $500 each. 5.5.2 O&M reporting Please provide a short narrative about the methods that will be used to gather and store reliable operations and maintenance data. including costs, to comply with the operations reporting requirement identified in Section 3 .15 of the Request for Applications If this project proceeds to construction, the following documentation will be collected on a monthly basis by our finance depa rtment to understand the impac t of the solar PV/Battery systems once they are operational : • • • kWh produced by the Solar PV Diesel fuel usage in the power plant Cost of diesel fuel //: I Battery round Trip Efficie ncy Diesels-off hours • Battery station service • Maintenance and Material Costs • AddWonallaborhouffi This information will be repo rted annually to AEA in the required format. I SECTION 6-ECONOMIC FEASIBILITY AND BENEF ITS I 6 .1 Economic Feasibility AEA 23001 Page 30 of45 1 1116/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form I 6.1.1 Economic Benefit Annual Anticipated Diesel Fuel Displaced for Power Ambler-23,869 Generation (gallons) Kiana-21 ,979 Noorvik -26,223 Selawik-30,028 Anticipated Fuel Displaced for Heat (gallons) Total Fuel displaced (gallons) Ambler-23 ,869 Kiana-21,979 Noorvik -26,223 Selawik-30,028 Anticipated Diesel Fuel Displaced for Power YEAR 1 Generation ($) Ambler-$160,815 Kiana-$80,248 Noorvik -$93,880 Selawik -$107078 Anticipated Fuel Displaced for Heat($) Anticipated Power Generation O&M Cost Ambler -$20,489 Savings Kiana -$6,870 Noorvik-$ 7,251 Selawik-$2 ,925 Anticipated Thermal Generation O&M Cost Savings Total Other costs savings (taxes, insurance, Ambler-$1500 etc.) Kiana-$550 Noorvik -$550 Selawik -$145 Total Fuel, O&M, and Other Cost Savings Ambler-$186,655 Kiana -$87,668 Noorvik-$101,681 Selawik-$110,148 6.1.2 Economic Benefit ALASKA ENE RGY AUTHOR I f Y Lifetime Ambler-596,736 Kiana-549,482 Noorvik-655 ,568 Selawik-750,700 Ambler-596,736 Kiana-549,482 Noorvik -655,568 Selawik-750 ,700 Ambler-$4,436,909 Kiana -$2 ,287,029 Noorvik-$2,675 ,510 Selawik -$3,051653 Ambler-$512,225 Kiana-$171,750 Noorvik-$181,275 Selawik -$73,125 Ambler-$37 ,500 Kiana-$13,750 Noorvik-$13,750 Selawik-$3 ,625 Ambler-$4,986,645 Kiana-$2,472 ,518 Noorvik -$2,870,532 Selawik -$3 ,128,402 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 The economic model used by AEA is available at ttttp s 1 w.akc 'r .1 · L I 2!..JL. c i • ' le- no,G ra t t ,-____:_B~=or r,,..rl.l r r2 1 RE F ·J~ r:=t l io n. Thiseconomicmodelmaybe used by applicants but is not required. The final benefit/cost ratio used will be derived from the AEA 23001 Page 31 of 45 11/16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form ALASKA ENERGY 1\UTH ORITY AEA model to ensure a level playing field for all applicants. If used, please submit the model with the application . The economic modeling used for this application was the AEA B/C ratio model. Potential annual fuel displacement (gallons and dollars) over the lifetime of the evaluated renewable energy project: In total, the project will displace the equivalent of 102,099 gallons of diesel fuel for electrical generation annually. The average price of fuel from the B/C ratio model was used for our estimates and the 2024 cost was: Ambler-$6 .74/gallon Kiana -$3.65/gallon Noorvik -$3 .58/gallon Selawik -$3.57/gallon Based on the output of the B/C ratio model, over the 25-year lifetime of the project, the project will displace 2,552,486 gallons of diesel, with a lifetime cost savings of $13,458,097 million . In the first year of operation , the renewable energy systems are expected to save the communi ties more than $486 ,152 that will be used for utility operations and maintenance, savings for future equipment replacements , operator and technical training, reduction in electric rates for commercial and residential consumers. The B/C ratio for each community is : Ambler -1.24 Kiana - .63 Noorvik-.69 Selawik -. 71 Because of Ambler's high cost of diesel , the economics are positive . The other communities have cha ll enging econom ics due to the relative ly low cost of diesel. This is a challenge that many remote communities, especially AVEC communities, encounter when trying to justify the extremely high construction costs for ren ewab le energy projects with fuel that is purchased in bulk for all their service areas and tank farms that have been subsidized and are not accounted fo r in fue l costs. This is the reason NAB is proposing to demonstrate the economies of scale th rough bundling for engineering , funding, procurement, and construction to make more renewable energy systems in remote communities economica lly justified. For example, if we can achieve a 25 % to 30 % reduction in project development and co nstruction costs through the economies of scale for Selawik, the B/C ratios becomes posit ive. The economics of these projects are also very sensitive to fuel cost increases. The installation of battery energy storage systems are expected to have positive impacts o n the operation of the diesel power plants, regardless of the renewable energy system . These benefits include utilizing battery charge and discharge to maximize the fuel efficiency of the diesel engines and reducing or eliminating brown-out and black-outs . A recent potential power outage in Shungnak was avoided due to the battery providing time for the powerplant operators to troubleshoot a diesel engine problem and restarting the system before an outage could occur. Unfortunately, the e conomi c benefits of these other diesel engine benefits have not been quantified and the fuel efficiency controls AEA 23 001 Page 32 of45 11/16/2021 Renewable Energy Fund Round 14 Gran t Application-Standard Form ALASKA ENE RGY 1\UTHORifY have not been fine tuned . This work is a goal of the NAESC for their operating high penetration systems . The assumptions used in the B/C ratio analysis are: Annual solar production and diesels off hours -values calculated in the HOMER modeling feasibility studies . Annual Renewable Energy O&M costs -1% of the battery capital cost for the battery system O&M. Solar PV O&M costs including panels and inverters and associated equipment-$20 per year per installed kW . Installed PV capacities from HOMER modeling feasibility studies. Diesel Generator O&M is based on the size of the generators in each community. Displaced schedule component replacement cost savings due to diesels off is calculated using actua l AVEC genset replacement costs and typical lifetime hours . Project life of 25 years 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 inc lude: • 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 produ ced over the life of the project. • Deferred and/or inadequate facility maintenance • Other factors Because NAB is only requesting Final Design and Permitting for these projects, the economic analysis for ea ch community will be fine-tuned based on the capital costs from construction ready des igns and current fuel prices. The economic risks of the operation of these projects are also very low if the pre -con struction economic analyses recommend project construction . The operating model used in NAB with an IPP operating and maintaining the Solar PV and AVEC operating and maintaining the battery was put in place to minimize ec onomic risks . The ease of operation of solar PV reduces the risk of operational failure s due to inadequate maintenance from an IPP, and AVEC has a successful history of operating and maintaining battery systems . Be ca use the renewable energy is solar PV, there is no fuel cost that can create negative savings for the communities. Low diesel costs will ex tend the payback of projects, but it is very un li kely that the diese l prices w ill drop so low that there is not positive cash flow for these projects. 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 bri ef description of the direct and indirect public benefits derived from 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 I Renewable energy resource availability (kWh per month) AEA 23 00 1 P age 33 of 45 11 /16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form Estimated direct sales to private sector businesses (kWh) Revenue for displacing diesel generation for use at private sector businesses ($) Estimated sales for use by the Alaskan public (kWh) Revenue for displacing diesel generation for use by the Alaskan public($) 6.2 Other Public Benefit ALASK A ENERGY AUTHOR ITY 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 The primary goals of this project are to reduce the reliance on expensive diesel fuel and the costs of generating electricity in our communities. Additional goals include increasing local and regional capacity around energy security, establishing a platform for future energy innovation, reducing risks associated with long distance marine-based fuel delivery, and mitigating and adapting to climate change . Reducing reliance on diesel fuel through solar and battery systems will increase our energy security, as will use of battery energy storage to provide additional generating assets. Further, we intend to establish an Independent Power Producer (IPP) that will be managing the s ystems and selling power to AVEC. This will increase our local a nd regional capacity for the operations and maintenance of renewable energy systems and potentially support the development of a regional energy services provider in partnership with the regional stakeholders . This will ultimately result in lower costs and improved maintenance of community-owned infrastructure. We will be demonstrating the opportunities for economy of scale for renewable energy systems, which, once established , can apply across Alaska . Due to the extremely high cost of construction in remote Alaska , many renewable energy systems are financially cha llenged to achieve B/C ratios of 1.0 or better making funding such as AEA's REF program difficult to acquire. Bundling multiple projects might be an opportunity to reduce costs through multiple purchases and reduced mobilization expenses. Battery, solar, and construction vendors have expressed interest in working with NAB for cost reductions through scale, and our region has demonstrated the ability and willingness to develop multiple projects and serve all communities in the region . Implementing multiple projects in a remote region also is an enhanced workforce development opportunity. If four so lar PV, battery, and diesel hybrid systems are constructed over multiple years, stable, long-term region a l jobs will be developed, and crew members will have multiple years to develop and use technical skills. This stable construction workforce will reduce construction costs on future projects and the region will have a well -trained workforce. New Market Ta x Credits are fund ing opportunities that have been available to many large projects in the past, requiring between $5 million and $10 million minimum project sizes. Most projects in AEA2300 1 Pa ge 34 of45 11/16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form ALASKA ENERG Y AUTHORITY rural Alaska have not been eligible for these programs because the projects are just too small. Bundling multiple renewable energy projects together could help meet the minimum size for eligibility for New Market Tax Credits and open a new funding mechanism for rural communities . As mentioned in the Economic Benefit section, utilizing the battery energy storage system to reduce or eliminate brown-outs and black-outs and maximize the fuel efficiency of the operating diesel engines is a goal of these hybrid systems and will be a focus for optimization in the coming years . Other public benefits include: • Reduced electric rates for commercial customers that could be passed to community members through lower prices . • Reduced electric rates for commercial customers could lead to economic development such as opening a restaurant. • Extension of the distribution system to the solar PV arrays will help facilitate new housing development in the future . • Leverage opportunities for future construction with "outside ," i.e., federal support that would otherwise not be brought into the communities. • Maintained leadership within the state for the NAB/NANA region , and ongoing recognition of state leadership within the global clean energy community focused on remote microgrids. • Continued innovation , both technically and financially, that could ultimately be replicated at scale across Alaska. SECTION 7 -SUSTAINABILITY Describe your plan for operating the completed project so that it will be susta inable 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 business and operations plan will be developed during this phase of the project and will inform the project sustainability. In a previous collaborative project between NAB and AVEC in Shungnak, the solar PV system supported the establishment of a community-based Independent Power Producer that sells power to AVEC. The battery and supervisory controller are operated and maintained by AVEC because AVEC is responsible for the dispatch of the entire power generating system. The AVEC maintenance organization supports these installations and has an extensive staff of skilled mechanics and technicians. AVEC has proven over many years that they can successfully maintain complex equipment and controls. By partnering with AVEC , all parties have an ongoing interest in maintaining the system, reducing fuel use and system costs , and developing a trained workforce . The NAB and NANA are also supporting the community-based IPP through technical support of their own staff and hired contractors , thus reducing costs to the community, AEA 2300 1 Page 35 of45 11/16/2021 R en ew able Ener gy Fund Round 14 Gra nt Applicatio n -St and a rd F orm ALASKA ENERG Y A U T H O~ITY and chron icling lessons learned for continual system optimization and improvement with each new project. This spans design, construction, 0 & M, local training, and financial management for long term sustainability. The AVEC/IPP example will most likely be the model proposed for the management structure of the four communities addressed in this application . The Solar PV IPP will employ one part-time technician from the local community to operate and maintain the PV system. The solar technician in each community will be involved in the design of the solar PV, battery and diesel hybrid systems and will be included on the construction crews . Their training will consist of involvement in designing and building the system from a greenfield site. The operations and maintenance requirements will also be thoroughly detailed in O&M manuals that will be deliverables of the construction phase. These manuals will detail the periodic inspections and maintenance activities for required daily inspections forms and initial spare parts will be included in the equipment purchases. Commissioning will also include vendor specific training from the suppliers' technical support teams . The IPP leadership and AVEC operators will conduct monthly meetings to verify that all required O&M and data tracking expectations are taking place. With 4 operating systems and potentially f ive more systems in development, the NAESC will form an operators ' network subcommittee to discuss operational and maintenance best practi ces and issues and expand technician capacity and support within the region. This w ill be further supported by the NAB and NANA Energy Programs. 7 .1.2 Fi nancial Susta inability • 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. For each community, detailed capita l costs estimates based on actual vendor equipment and construction quotes will be developed from the construction ready designs that result from this project. Economic Analyses will be conducted with these cap ital costs and the latest fuel costs to determine if a project should move forward to construction or if there is a better use for the capital investment. NRC a nd NAB have w o rked with c on s ultants t o develop a rate sett ing c al c u lator that take s into account a Power Purchase Agreement (PPA) with utilities. This tool accounts for all annual operations and maintenance costs and estimates the impact to PCE reimbursements to the utilities. This tool will be used to develop rates for PPA's with AVEC to assure that the IPP, the utility, and the rate payers benefit from the project. AVEC will continue to utilize their successful revenue collection process with the ir rate payers, so non-payment is not an issue. All of these details will be addressed in the business plan deliverable of this project. 7.1 .2.1 Revenue Sources Briefly explain what if any effect your project will have on e lectrical 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 AEA 2300 1 Page 3 6 of 45 11/1 6/2021 Renew able Ene rgy Fund R o un d 14 Grant Application-Standa rd Fo rm • What is the expected cost-ba sed rate (as consistent with RFA requirements) ALASKA ENERG Y AUTHORITY • If you expect to have multiple rate classes, such as ex cess e lectricity 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 ex cess electricity for heat). • Annual customer revenue sufficient to cover costs • Additional incentives (i.e . ta x credits) • Additional revenue streams (i.e . green tag sales or other renewable energy subsidies or programs that might be available) If these projects move into the commercialization phase , it will be because they stabilize and potentially provide a slight reduction in rates to utility commercial customers . The rates will be set in the PPA negotiations with AVEC during the deve lopment of the business plan , and there is commitment from all parties that the projects w ill not move forward to construction unless the benefits of the projects are shared between the IPP , the util ity , and the rate payers. Th is project is not expected to resu lt in mu ltiple rate c lasses, additional incentives, or additional revenue streams. 7.1.2.2 Power Purchase/Sale The power purchase/sale informati on should include the following: • Identification of potential power buyer( s )/custome r( 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 c ustome rs . NAB has recently partnered with AVEC on a very sim il ar project to what is proposed in this appl ication . An IPP owned by the Nati ve V illage of Shungna k and supported by NAB has entered into a PPA with AVEC for a solar PV, battery , and diesel hybrid system . The IPP operates and maintains the Solar PV array, and AVEC o perates and maintains the battery system . AVEC has provided a letter of support indicating that they are interested in developing PPA's for future projects in the NAB. AVEC has also been actively involved in th is appl ication development. The potential power purchase/sales p ri ces will be deve loped through the business plan process and will be based on AVEC displaced fuels costs. In general , the renewable generation will be priced at the avoided fuel cost for AVEC minus O&M cost s and other system encumbrances that AVEC will n eed to cover as a result of the renewable asset inter-connected to AVEC's generation and d istribution system . This will ensure fairly distributed benefits to all stakeholders in the community . I 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 w ith work once your grant is approved . Speci fically address your progress towards or read iness to begin , at a minimum , the follow ing : • The phase(s) that must be completed prior to beginn ing the phase(s ) proposed in this application • The phase(s ) proposed in this appl ica ti on • Obta ining all necessary permits AEA 23001 P age 37 of 45 1 1116/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form • Securing land access and use for the project • Procuring all necessary equipment and materials ALASKA ENERGY AUTHOR ITY 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. The development of these projects for Ambler, Kiana , Noorvik, and Selawik have followed the traditional renewable energy project development process. A sola r resource assessment for Alaska was conducted by the National Renewable Energy Lab in 2016 to provide a basic framework for solar PV feasibility studies. We also have excellent solar PV production data for all communities in the NAB/NANA region, including the four communities included in this proposal, from solar PV installations installed at the communities' water treatment plants, which were a pre-cursor to this proposed project and other solar PV systems throughout the region. Based on this production data, we have detailed understanding of the reliability and performance of solar PV, but site-specific projects at community scale will have different economics, and this project is designed to determine these variables. As well, we now have experience with several village-scale installations in other nearby communities, so most residents are exposed to the technology and very interested in developing it for their own communities. The NAESC energy education process that has occurred for over a decade has also contributed to widespread community readiness , which is why we are now actively considering multiple projects at once, in attempts to reduce costs and systematize the initiatives. NAB and the Northwest Arctic Energy Steering Committee conducted community outreach and educational activities to support the development of regional and community energy plans. Solar PV and battery systems were high priorities. This application is an outgrowth of these efforts . Feasibility studies through the Alaska Native Tribal Health Consortium were conducted for each community, addressing optimum sizing of the solar PV arrays , battery and converters and performing a basic economic viability analysis . The feasibility studies showed that the systems could result in significant diesel savings and diesel-off operation , but the economics of the projects in Kiana, Noorvik, and Selawik are challenging when implemented as single stand-alone efforts. As a result, the project team is proposing the bundling of these four projects to improve the economics of the projects throug h cost savings related to economies of scale for bulk purchases and contracts. We are requesting Final Design and Permitting in this application to understand the cost savings opportunities with economies of scale . Site Selection will be finalized in this phase , and NRC has expressed interest in providing land for the solar arrays. Permitting will also take place during this phase of the project. Once the designs are complete and the economic evaluations are complete, the NAB , AVEC and the communities will make a determination if the projects should move forward to construction . Grant funding, loans, and other funding mechanisms will be pursued to complete the funding packages . 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. Invo ices for work completed, AEA 23001 Page 38 of 45 11 /16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form 4 . Photos of the work performed, and/or ALASKA ENERGY 1\LJTHGRI fY 5 . Any other available verification such as scopes of work, technical drawings, and payroll for work completed internally. Our region, led by NAB , has been focused on energy efficiency measure since the early 2000's . The NAB School District has completed large LED lighting upgrades throughout the local schools. The small local stores have been encouraged to carry LED bulbs in stock-a rarity in rural Alaska . AVEC has aggressively constructed heat recovery systems in all NAB utilities including Ambler, Kiana , Noorvik, and Selawik which has increased the heat rejection rate from some of its generators to facilitate the expansion of the heat recovery systems. All of the above demonstrate our commitment for energy sovereignty and our capability for successful project planning and implementation . Ambler installed a heat recovery system and completed audits and winterization upgrades in its water treatment plant along with whole house weatherization recently completed in preparation of residential heat pump installations. Kiana was a participant in the Remote Alaska Communities Energy Efficiency (RACEE) program through the Department of Energy and implemented energy efficiency measures (EEMs) to eight community buildings, including the youth center, City Industrial Arts classroom , school, clinic, tribal office, city office, city shop & warm storage, city administrative building , and fire house. The EEMs included: replacing old , inefficient lightbulbs with light emitting diodes (LEOs) both inside and outside all eight buildings; installing motion light sensors to optimize electricity usage when spaces are unoccupied; air sealing all building envelopes to insulate against heat loss; programming automatic setback thermostats to adjust heating when outside temperatures peak and plummet; and lastly, retro-commissioning of the school to ensure that all mechanical systems are again functioning as designed . Kiana also implemented energy efficiency measures and installed a waste heat recovery system on their water treatment plant. The energy efficiency measures included installation of LED lights , heat add controls with modulating valves , updated boiler controls , air sealing, and programmable thermostats . The local water treatment plant operators participated in this process and were trained on efficient system operations. Noorvik was also a participant in the RACEE program and performed energy efficiency audits on three community buildings and investigated the expans ion of heat recovery system. Unfortunately, the heat recovery expansion was determined not financially viable at the 65% design phase . Through the Village Energy Efficiency Program (VEEP), one community building completed extensively weatherization upgrades and the heat recovery system to the Water Treatment Plant was optimized . Selawik's energy efficiency work has been focused on the water and sewer system that freezes up annually. Through the VEEP program , there has been significant progress on repairing leaks in the vacuum system , adding insulation to the above ground piping , replacing aging and poorly sized pumps, and optimizing heat trace on the piping . Additional work is still required and ANTHC is seeping capital projects for additional major repairs . As well , throughout the region , NANA contributed about $2 million to energy efficiency initiatives through the Energy Wise program with RurAL CAP from 2010-2013 with meaningful impact, saving fuel and improving quality of life for shareholders and residents in all 11 communities. AEA 23001 Page 39 of45 1 1/16/202 1 Renewable Energy Fund Round 14 Grant Application -Standa rd Form SECTION 9 -LOCAL SUPPORT AND OPPOSITION ALASK A ENE RGY AUTHORI TY 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 . Because of the education and outreach work that has been completed by the NAESC in the last 12 years, communities and regional entities are very engaged in the energy development process. Active participation in the NAESC and Letters of Support have been submitted by the following partners: NAB Resolution NANA Regional Corporation Alaska Village Electric Cooperative City of Ambler City of Selawik Maniilaq Association Launch Alaska Bundling these projects is a high priority and does not engender any opposition that we are aware of throughout the region. 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 . The NAB's annual general fund appropriation is approximately $23 million, of which,80% of the revenue ($18 . 7 million) is derived from the PIL T agreement with the Red Dog Mine . The PIL Tis negotiated every 5-10 years while the mine is in operation . The NAB has received federal grant funds in the past, all of which were successfully administered and closed out and is the recipient of several current grants from the state of Alaska, mostly having to do with public safety. All grants are compliant , and reporting is being conducted by the appropriate administrators and Finance Department. As well, because of the VIF account, the NAB is in a similar position to AEA in that we administer community grants and require careful accounting from our grant recipients, and we are accountable to all the communities and Red Dog for providing the support. This has required careful financial management. Currently, the NAB is not receiving any direct federal funding but we are helping the City of Ambler manage their USDA HECG Biomass Facility project and we are about to manage a $2 million US DOE Indian Energy solar PV and battery construction grant for the community of Noatak. The NAB also maintains an active SAM registration. The following AEA grants have been award to the NAB in the last 12 years: Recipient Grant Program NAB REF AEA 23001 Project Wind Farms for Buckland Deering and Page 40 o f 45 Funding Amount $10,738,438 Year Awarded 2009 11 /16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form Noorvik- 2195377 NAB REF Upper Kobuk Biomass- 7040028 NAB EETF Testing of the Eocycle EO 25/12 Tilt-Up Wind Turbine in Kotzebue , Alaska 7310071 $185,867 $284,843 ALASKA ENE RGY AUTHORITY 2012 2013 One of the strengths of energy development in the Northwest Arctic Borough is the diverse collaboration among stakeholders within the communities as well as numerous supporting organizations and service providers outside the communities. The NAB and NRC are co -sponsors of the Northwest Arctic Energy Steering Committee (NAESC ), a collaboration of energy leaders representing all the communities of the NAB . This organization has been instrumental in the development of renewable energy systems in the region, resulting in an innovative and diverse portfolio of successful projects . Our experience with federal funded assistance agreements shows that our assembled project team has the breadth and depth of knowledge to successfully implement this proposed solar PV and battery storage design and permitting project. The following table summarizes some of the many state and federal grants received by members of our project team . Recipient Grant Program Project Amount Year Awarded NAB USDA-High Ambler Bi o mass $700,000 2019 Energy Cost Native Village of EPA-DERA Deering Diesel $418 ,180 2021 Deering Engine Replacements Native Village of EPA -DERA Buckland Diesel $485,423 2020 Buckland Engine Replacements Native Village of BIA -Tribal Utility Capacity $99 ,000 2019 Kiana Energy Development Deve lopment and IPP Capacity Formation NANA Regional BIA-Tribal Regional Energy $100 ,000 2018 Corporation Energy Support Development Organization Capacity Formation NAB AEA REF Wind Turbines in $10 .7 million 2009 Buckland and Deering NANA Regional DOE -Indian Solar PV in $1 million 2017 Corporation Energy Kotzebue , AEA 23 00 1 P a ge 41 of 45 11 /16/2021 Re newable Energy F und Round 14 Grant Applica tio n - Stan da rd Form Buckland, and Deering NANA Regional USDA-HECG Battery Energy Corporation Storage in Buckland and Deering NANA Regional DOE -Indian Regional Corporation Energy Technical Support NAB USDA-HECG Solar PV and Battery in Shungnak NAB DOE -Indian Noatak Solar PV Energy and Battery City of Kobuk AEA-REF Biomass Heating City of Ambler AEA-REF Ambler Heat Recovery $1 .6 million $500 ,000 $2 .1 million $2 million $401,87 3 $435 ,000 ALASKA ENERG Y /\UTH0RITY 2016 2016 2021 2021 2011 2009 The NAB's Co mprehensive Eco nomic Development Strategy and energy plann ing activities a re encapsulated in a detailed energy plan found on our website at: Northwest Arctic Borough Comprehensive Eco nomic Development Strategy -Jl,l l1 r ,. - ! t ' f 1[ r•!< 1, j l I J j•l rr. r • I , 1 . ') f SECTION 11 -LIST OF SUPPORTI NG DOCUMENTATION FOR PRIOR PHASES In the space below, please provide a list of additional documents attached to support completion of prior phases . Please see the follow ing doc uments in t he Attachments: Re connaissance -Solar Energy Prospec ting in Remote Alaska-An Economic Ana lys is of Solar Photov oltaics in the Last Frontier State" by Paul Schwabe , Nationa l Renewab le Energy Laboratory U.S.· Proje ct Feasibility Reports for: Ambler Kiana Noorvik Shungnak SECTION 12-LIST OF ADD IT IONAL DOCUMENTAT ION SUBM ITTED FOR CONSIDERATIO N In the space below , please provide a list of additional information submitted for consideration . Detailed Capital Budget AVEC Fleet Summary Solar and Battery O&M Cal culations Diesels Off Replacement Costs AVEC Maintenance Schedul e B/C ratio models Team Resumes AEA 2300 1 Page 4 2 of45 11/1 6/20 21 Renewable Energy Fund Round 14 Grant Application -Standard Form I SECTION 13 -AUTHORIZED SIGNERS FORM Community/Grantee Name: Northwest Arctic Borough Regular Election is held: First Tuesday of November every 3 years . Next election is in 2024. I Authorized Grant Signer(s): Printed Name Title Date: -1\ \ 5\202 L\ Term ALASKA ENERG Y AUTHORITY Signature Dickie Mota Mayor 2021-2024 C-?._ ;.:: fXl1 I authorize the above person(s) to sign Grant Documents: Must be authorized b the hi hest rankin or anization/communit /munici Printed Name Title Term Dickie Mota Mayor 2021-2024 I Grantee Contact Information: Mailing Address: P.O . Box 1110 Kotzebue , AK 99752 Phone Number: 907-442-2500 Fax Number: 907-442-2930 Email Address: imathiasson@nwabor.org Federal Tax ID #: Tax ID # 92·0116661 Please submit an updated form whenever there is a change to the above information. AEA 23 001 P age 43 of 45 11/16/2021 Renewable Energy Fund Round 14 Grant Application -Standard Form SECTION 14-ADDITIONAL DOCUMENTATION AND CERTIFICATION ALASKA EN ERGY f\UTHORITY SUBMIT THE FOLL OWING DOCUMENTS WITH YOUR APPLICATION: A. Contact information and resumes of Applicant's Project Manager, Project Accountant (s), key staff, partners, consu ltants, and suppliers per application form Section 3.1, 3.4 and 3.6. Applicants are asked to provide resumes submitted with appli cations in separate electronic documents if the individuals do not want their resumes posted to the project web si te. B . Letters or resolutions demonstrating l ocal support per appl ication f orm Section 9. stat 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 acti on taken by t he applicant's governing body or management per RFA Section 1.4 that: • Commits the o r ganization to provide the matching resources f o r project at the match amounts indicated in the application. • Authorizes the individual who signs the appl ication has the authority to commit the o r ganization to the obligations under the grant. • Provides as point of contact to represe nt the applicant f o r purposes of this application. • Certifies the applicant is in compliance with applicable federa l, state, and l ocal, l aws inc ludin g existing credit and f ederal tax obligations. E. An electr oni c versi on of the entire application on CD or other electronic media, per RFA Section 1. 7. F. CERTIFICATION The undersigned certifies that this appli cation for a renewable energy grant is truthful and correct, and that the applicant is in compliance with, and will continue to compl y with, all federal and state laws includ ing existing credit and federal tax obligati ons and that they can indeed commit the entity to these obligations. Print Name Dickie Moto Signature a /-~-~ D/1/1 Title Mayor Date /~6/zc AEA 2300 1 Page 44 of45 11 /16/2021 Renewable Energy Fund Round 14 Grant Application-Standard Form AEA 23001 Page 45 o f 45 ALA SKA ENERGY 1\UfH()RifY 11/16/2021