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HomeMy WebLinkAboutAPP_13015-E-REFr13_StdApp_BurroCreekFINALRenewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 1 of 33 7/20/2020 Application Forms and Instructions This instruction page and the following grant application constitutes the Grant Application Form for Round 13 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: www.akenergyauthority.org/what-we-do/grants-loans/renewable-energy-fund-ref-grants/2020-ref- application. What follows are some basic information and instructions for this application:  The Alaska Energy Authority (AEA) expects this application to be used as part of a two-year solicitation cycle with an opt-out provision in the second year of the cycle.  If you are applying for grants for more than one project, provide separate application forms for each project.  Multiple phases (e.g. final design, construction) for the same project may be submitted as one application.  If you are applying for grant funding for more than one phase of a project, provide milestones and grant budget for each phase of the project (see Sections 3.1 and 3.2.2).  In order to ensure that grants provide sufficient benefit to the public, AEA may limit recommendations for grants to preliminary development phases in accordance with 3 Alaska Administrative Code (ACC) 107.605(1).  If some work has already been completed on your project and you are requesting funding for an advanced phase, submit information sufficient to demonstrate that the preceding phases are completed and funding for an advanced phase is warranted. Supporting documentation may include, but is not limited to, reports, conceptual or final designs, models, photos, maps, proof of site control, utility agreements, business and operation plans, power sale agreements, relevant data sets, and other materials. Please provide a list of supporting documents in Section 11 of this application and attach the documents to your application.  If you have additional information or reports you would like the Authority to consider in reviewing your application, either provide an electronic version of the document with your submission or reference a web link where it can be downloaded or reviewed. Please provide a list of additional information; including any web links, in Section 12 of this application and attach the documents to your application. For guidance on application best practices please refer to the resource-specific Best Practices Checklists; links to the checklists can be found in the appendices list at the end of the accompanying REF Round 13 RFA.  In the Sections below, please enter responses in the spaces provided. You may add additional rows or space to the form to provide sufficient space for the information, or attach additional sheets if needed.  If you need assistance with your application, please contact AEA’s Grants Manager Karin St. Clair by email at grants@akenergyauthority.org or by phone at (907) 771-3081. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 2 of 33 7/20/2020 REMINDER:  AEA is subject to the Public Records Act AS 40.25, and materials submitted to AEA may be subject to disclosure requirements under the act if no statutory exemptions apply.  All applications received will be posted on the Authority web site after final recommendations are made to the legislature. Please submit resumes as separate PDFs if the applicant would like those excluded from the web posting of this application.  In accordance with 3 AAC 107.630 (b) Applicants may request trade secrets or proprietary company data be kept confidential subject to review and approval by AEA. If you want information to be kept confidential the applicant must: o Request the information be kept confidential. o Clearly identify the information that is the trade secret or proprietary in their application. o Receive concurrence from the Authority that the information will be kept confidential. If the Authority determines it is not confidential, it will be treated as a public record in accordance with AS 40.25 or returned to the applicant upon request. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 3 of 33 7/20/2020 SECTION 1 – APPLICANT INFORMATION Please specify the legal grantee that will own, operate, and maintain the project upon completion. Name (Name of utility, IPP, local government, or other government entity) Burro Creek Holdings, LLC Tax ID # 20-4675042 Date of last financial statement audit: Not applicable. Mailing Address: Physical Address: Box 796 3rd & Alaska Skagway, AK 99840 Skagway, AK 99840 Telephone: Fax: Email: 907-612-0702 907-983-2415 jan@redonion1898.com 1.1 Applicant Point of Contact / Grants Manager Name: Jan Wrentmore Title: Owner Mailing Address: Box 796 Skagway, AK 99840 Telephone: Fax: Email: 907-612-0702 907-983-2415 jan@redonion1898.com 1.1.1 Applicant Signatory Authority Contact Information Name: Jan Wrentmore Title: Owner Mailing Address: Box 796 Skagway, AK 99840 Telephone: Fax: Email: 907-612-0702 907-983-2415 jan@redonion1898.com 1.1.2 Applicant Alternate Points of Contact Name Telephone: Fax: Email: Liz Lavoie 907-612-0702 liz@redonion1898.com Joel Groves 907-258-2420 907-258-2419 joel@polarconsult.net Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 4 of 33 7/20/2020 1.2 Applicant Minimum Requirements Please check as appropriate. If applicants do not meet the minimum requirements, the application will be rejected. 1.2.1 Applicant Type ☐ An electric utility holding a certificate of public convenience and necessity under AS 42.05 CPCN #______, or ☒ An independent power producer in accordance with 3 AAC 107.695 (a) (1) CPCN #______, or ☐ A local government, or ☐ A governmental entity (which includes tribal councils and housing authorities) Additional minimum requirements ☒ 1.2.2 Attached to this application is formal approval and endorsement for the project by the applicant’s board of directors, executive management, or other governing authority. If the applicant is a collaborative grouping, a formal approval from each participant’s governing authority is necessary. (Indicate yes by checking the box) ☒ 1.2.3 As an applicant, we have administrative and financial management systems and follow procurement standards that comply with the standards set forth in the grant agreement (Section 3 of the RFA). (Indicate yes by checking the box) ☒ 1.2.4 If awarded the grant, we can comply with all terms and conditions of the award as identified in the Standard Grant Agreement template at www.akenergyauthority.org/what-we-do/grants- loans/renewable-energy-fund-ref-grants/2020-ref-application (Any exceptions should be clearly noted and submitted with the application.) (Indicate yes by checking the box) ☒ 1.2.5 We intend to own and operate any project that may be constructed with grant funds for the benefit of the general public. If no please describe the nature of the project and who will be the primary beneficiaries. (Indicate yes by checking the box) Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 5 of 33 7/20/2020 SECTION 2 – PROJECT SUMMARY 2.1 Project Title Provide a 4 to 7 word title for your project. Type in the space below. Burro Creek Hydro Project 2.2 Project Location 2.2.1 Location of Project – Latitude and longitude (preferred), street address, or community name. Latitude and longitude coordinates may be obtained from Google Maps by finding you project’s location on the map and then right clicking with the mouse and selecting “What is here? The coordinates will be displayed in the Google search window above the map in a format as follows: 61.195676.-149.898663. If you would like assistance obtaining this information, please contact AEA’s Grants Manager Karin St. Clair by email at grants@akenergyauthority.org or by phone at (907) 771-3081. Latitude 59.433703 north Longitude 135.368351 west From Skagway Harbor, proceed south along Lynn Canal approximately two miles, turn right at first valley. Dock is on north side of creek. Please coordinate with owner prior to a site visit. 2.2.2 Community benefiting – Name(s) of the community or communities that will be the beneficiaries of the project. Skagway and Haines. 2.3 Project Type Please check as appropriate. 2.3.1 Renewable Resource Type ☐ Wind ☐ Biomass or Biofuels (excluding heat-only) ☒ Hydro, Including Run of River ☐ Hydrokinetic ☐ Geothermal, Excluding Heat Pumps ☐ Transmission of Renewable Energy ☐ Solar Photovoltaic ☐ Storage of Renewable ☐ Other (Describe) ☐ Small Natural Gas 2.3.2 Proposed Grant Funded Phase(s) for this Request (Check all that apply) Pre-Construction Construction ☐ Reconnaissance ☒ Final Design and Permitting ☒ Feasibility and Conceptual Design ☐ Construction Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 6 of 33 7/20/2020 2.4 Project Description Provide a brief, one-paragraph description of the proposed project. Develop a 2 MW run-of-river hydro project on private property at Burro Creek near Skagway. Transmit electricity to markets in Skagway (and possibly Haines) via a submarine cable. 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. We propose to build on our 2011 feasibility study and subsequent efforts to advance this project to a shovel-ready condition. Major tasks will include: - Develop a business plan to articulate the market for electricity from the project, business partners, project economics, financing, and related matters. - Secure necessary local, state, and federal permits and authorizations for the project. - Complete designs for an approximately 2 MW on-property hydro project. Design of the powerhouse and/or penstock would consider cost-effective accommodations for future upgrade to a higher-head 7 MW project that would be achieved by building a intake on federal land upstream. 2.6 Previous REF Applications for the Project See Section 1.15 of the RFA for the maximum per project cumulative grant award amount Round Submitted Title of application Application #, if known Did you receive a grant? Y/N Amount of REF grant awarded ($) Round 1 Burro Creek Hydro Feasibility Study #42 Y $48,000 Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 7 of 33 7/20/2020 SECTION 3 – Project Management, Development, and Operation 3.1 Schedule and Milestones Please fill out the schedule below (or attach a similar sheet) for the work covered by this funding request. Be sure to identify key tasks and decision points, including go/no go decisions, in your project along with estimated start and end dates for each of the milestones and tasks. Please clearly identify the beginning and ending of all phases (I. Reconnaissance, II. Feasibility and Conceptual Design, III. Final Design and Permitting, and IV. Construction) of your proposed project. See the RFA, Sections 2.3-2.6 for the recommended milestones for each phase. Add additional rows as needed. Task # Milestones Tasks Start Date End Date Deliverables 1.1 -Business Plan Assessment of new market opportunities Inventory of Skagway port infrastructure Business Plan July 2021 March 2022 -Business Plan Decision Point at end of 2021 on proceeding with project based on outcome of Business Plan 2.1 -Permit Applications -Issued Permits State and Local Permits April 2022 March 2023 -Permit Applications -Resource Studies -Issued Permits 2.2 -Permit Applications -Issued Permits Federal Permits April 2022 April 2023 -Permit Applications -Resource Studies -Issued Permits 3.1 -35%, 65%, 95%, final design documents Project Design July 2021 Dec 2022 -Technical study reports -Final design documents Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 8 of 33 7/20/2020 3.2 Budget 3.2.1 Funding Sources Indicate the funding sources for the phase(s) of the project applied for in this funding request. Grant funds requested in this application $586,000 Cash match to be provideda $1,000 In-kind match to be provideda $25,000 Energy efficiency match providedb $0 Total costs for project phase(s) covered in application (sum of above) $612,000 Describe your financial commitment to the project and the source(s) of match. Indicate whether these matching funds are secured or pending future approvals. Describe the impact, if any, that the timing of additional funds would have on the ability to proceed with the grant. All indicated matching funds are existing secured resources and are not pending future approvals. BCH commits to applying indicated matching funds to this project in accordance with execution of the applicable grant award. In-kind match may consist of (1) documented labor of BCH principals and/or personnel working directly towards completing grant scope of work at agreed market rates commensurate with the skills and type of work performed and/or (2) use of BCH vehicles, equipment, and/or facilities for transportation, meals, lodging, or other accommodation in direct support of completing grant scope of work at market rates commensurate with the season and nature of services / facilities rendered. 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. The proposed budget includes a contingency on all activities to address unforeseen project costs. Beyond that, BCH would control cost overruns through proactive project management to identify and adjust work scopes to prevent cost overruns where practical. In instances where cost overruns cannot be avoided, BCH would pay additional costs from its own resources. 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] $0 Feasibility and Conceptual Design [Actual] $60,000 Final Design and Permitting [Estimated] $612,000 Construction [Estimated] $18,500,000 Total Project Costs (sum of above) Estimated $19,172,000 Metering/Tracking Equipment [not included in project cost] Estimated $0 Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 9 of 33 7/20/2020 3.2.4 Funding Subsequent Phases If subsequent phases are required beyond the phases being applied for in this application, describe the anticipated sources of funding and the likelihood of receipt of those funds.  State and/or federal grants  Loans, bonds, or other financing options  Additional incentives (i.e. tax credits)  Additional revenue streams (i.e. green tag sales or other renewable energy subsidies or programs that might be available) BCH will consider all viable sources of funding for subsequent phases of construction. One objective of the business plan and currently proposed scope of work is to delineate funding requirements and options. State or federal grants and/or loans and private sector loans are all options. Revenues from electricity sales, green tags, energy subsidies, tax credits, and other sources will all be considered. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 10 of 33 7/20/2020 3.2.3 Budget Forms Applications MUST include a separate worksheet for each project phase that was identified in Section 2.3.2 of this application — I. Reconnaissance, II. Feasibility and Conceptual Design, III. Final Design and Permitting, and IV. Construction. Please use the tables provided below to detail your proposed project’s total budget. Be sure to use one table for each phase of your project, and delete any unnecessary tables. The milestones and tasks should match those listed in 3.1 above. If you have any question regarding how to prepare these tables or if you need assistance preparing the application please feel free to contact AEA’s Grants Manager Karin St. Clair by email at grants@akenergyauthority.org or by phone at (907) 771-3081. Phase 3 — Final Design and Permitting Milestone or Task Anticipated Completion Date RE- Fund Grant Funds Grantee Matching Funds Source of Matching Funds: Cash/In- kind/Federal Grants/Other State Grants/Other TOTALS 1.1 Business Plan Dec 2021 $151,000 $23,000 Cash / in-kind $174,000 2.1 State and Local Permits Dec 2022 $95,000 $1,000 Cash / in-kind $96,000 2.2 Federal Permits Dec 2022 $45,000 $1,000 Cash / in-kind $46,000 3.1 Technical / Resource Studies and Design Dec 2022 $295,000 $1,000 Cash / in-kind $296,000 TOTALS $586,000 $26,000 $612,000 Budget Categories: Direct Labor & Benefits $0 $25,000 Cash / in-kind $25,000 Travel & Per Diem $0 $1,000 Cash / in-kind $1,000 Equipment $0 $0 $0 Materials & Supplies $0 $0 $0 Contractual Services $586,000 $0 $586,000 Construction Services $0 $0 $0 Other $0 $0 $0 TOTALS $586,000 $26,000 $612,000 Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 11 of 33 7/20/2020 3.2.4 Cost Justification Indicate the source(s) of the cost estimates used for the project budget, including costs for future phases not included in this application. Current cost estimates are based on engineer’s opinion of probable cost developed for the proposed project. The estimate has been cross checked by consulting with local contractors experienced with both the project site and this type of construction and through comparison with actual construction costs for similar recent Alaska hydro projects. 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? Jan Wrentmore will monitor project progress on a minimum quarterly and more typically monthly basis to confirm progress is consistent with the established project schedule. BCH will monitor subcontracts with its consultants in accordance with the line item budget and schedule metrics established in those contracts. AEA will be informed of project status on an at least quarterly basis through submittal of quarterly progress and budget reports to the designated AEA project manager. 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 majority of project expenditures will be managed or overseen by Jan Wrentmore and/or Joel Groves. Both individuals are experienced in successfully managing grant awards under the REF program and are familiar with those costs that are reasonable, ordinary, and necessary for the proposed type of project. Ineligible costs, such as for overhead and other unallowable costs, will be excluded from reimbursement requests submitted by BCH to AEA. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 12 of 33 7/20/2020 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. Jan Wrentmore will be responsible for managing this project. Joel Groves, P.E. with Polarconsult Alaska, Inc. will be contracted for assistance with the business plan and to lead the design and permitting phases. He will assist Ms. Wrentmore in project management and reporting. 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. Bookkeeping activities will be the responsibility of Liz Lavoie, who currently performs bookkeeping services for Ms. Wrentmore’s other existing successful businesses in Skagway. Accounting services will be performed by Lisa Thoe of Sunset Accounting. 4.1.3 Expertise and Resources Describe the project team including the applicant, partners, and contractors. For each member of the project team, indicate:  the milestones/tasks in 3.1 they will be responsible for;  the knowledge, skills, and experience that will be used to successfully deliver the tasks;  how time and other resource conflicts will be managed to successfully complete the task. If contractors have not been selected to complete the work, provide reviewers with sufficient detail to understand the applicant’s capacity to successfully select contractors and manage complex contracts. Jan Wrentmore, owner of BCH, will lead the business plan (Task 1 activity) effort for this project. She will utilize her experience in tourism marketing, existing staff, contractors, and professional consultants as required to explore and define the available markets and business opportunities for electricity from Burro Creek. BCH will contract with Joel Groves, P.E. of Polarconsult Alaska, Inc. to lead design and permitting efforts for this project (Task 2 and 3 activities). Mr. Groves will also assist as appropriate with Task 1 (business plan) efforts. He will engage with and manage subject-expert subconsultants as needed to complete design and permitting. Mr. Groves has been involved with Burro Creek since 2009. He led the Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 13 of 33 7/20/2020 feasibility study effort, has managed the on-going hydrology study, and has performed other design and permitting efforts to support BCH’s on-going business activities at Burro Creek. BCH will contract with Hamilton Construction, Inc. of Skagway to tap their extensive construction experience in disciplines such as submarine cable laying, heavy civil construction, marine construction, vertical construction, electrical construction, and other relevant trades. BCH has previously contracted with Hamilton Construction on a variety of construction projects at Burro Creek including upgrades to the existing dock and repairs and upgrades to the existing hydro project. 4.2 Local Workforce Describe how the project will use local labor or train a local labor workforce. Routine repair, maintenance, and operations of the existing hydro at Burro Creek relies 100% on local labor. The upgraded hydro will be maintained, repaired and operated by the same staff. To the extent training is required to properly operate the larger systems and electrical interconnection BCH will train existing local staff or hire / contract with additional staff (local if possible) as appropriate to fill this need. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 14 of 33 7/20/2020 SECTION 5 – TECHNICAL FEASIBILITY 5.1 Resource Availability 5.1.1 Assessment of Proposed Energy Resource Describe the potential extent/amount of the energy resource that is available, including average resource availability on an annual basis. For pre-construction applications, describe the resource to the extent known. For design and permitting or construction projects, please provide feasibility documents, design documents, and permitting documents (if applicable) as attachments to this application (See Section 11). Likelihood of the resource being available over the life of the project. See the “Resource Assessment” section of the appropriate Best Practice Checklist for additional guidance. The capacity factor for the proposed hydro project is approximately 40%. This is based on resource availability and preliminary estimates of power output based on penstock losses and turbine / generator efficiency. Resource availability is characterized by an ongoing hydrology study initiated by BCH in 2009. The ten-year record at Burro Creek has a very good correlation (R2 = 0.88) with the concurrent USGS hydrology record at nearby Taiya River, providing a 26-year extended record for Burro Creek. The water resource is expected to be available over the 50-year life of the project. There are no other water rights or reservations on Burro Creek aside from those owned or applied for by BCH. The Burro Creek basin is unglaciated so climate change is not expected to be a significant factor in annual energy production. Project output will vary somewhat from currently estimated 1.84 MW upon final design as gross project head, penstock design, and turbine / generator efficiency are finalized. 5.1.2 Alternatives to Proposed Energy Resource Describe the pros and cons of your proposed energy resource vs. other alternatives that may be available for the market to be served by your project. West Creek, in the next basin north of Burro Creek, was under consideration for hydro development by the City government, Yukon Territory government, and AP&T several years ago. That project faced significant opposition from local residents in Dyea and is not under active consideration. AP&T has considered other hydro projects on the Haines – Skagway system, such as at Schubee Lake (study discontinued in 2013) and Connolly Lake (study discontinued in 2013) but these are not known to be actively pursued at this time. Walker Lake, a ~1 MW storage hydro project in the Chilkat Valley near Haines appears to be moving forward. LNG has been discussed as an alternative to diesel-fired generation over the years, but proposals have never advanced to a serious level of consideration. Burro Creek has major advantages over many alternative resources in the region as it is located on private land, avoiding the need for FERC licensing, and has a well-characterized hydrologic resource (10 years of hydrology with good correlation to the USGS gauge at Taiya River). Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 15 of 33 7/20/2020 5.1.3 Permits Provide the following information as it may relate to permitting and how you intend to address outstanding permit issues. See the “Environmental and Permitting Risks” section of the appropriate Best Practice Checklist for additional guidance.  List of applicable permits  Anticipated permitting timeline  Identify and describe potential barriers including potential permit timing issues, public opposition that may result in difficulty obtaining permits, and other permitting barriers Major permits needed for the project follow. Anticipated processing timeframe is presented for each. - ADNR water rights (existing application on file, LAS 29573) Water use permit not typically issued until project is ready for construction due to chronic ADNR case backlog. - ADNR tidelands easement (for submarine cable to Skagway) Estimated at one year. - Easement / agreements with City of Skagway for Skagway cable landing. Unknown. - ADFG Fish Habitat Permit (if required) Project is upstream of fish passage barrier. Finding of no permit required is expected. - FERC Jurisdictional Determination (normally 3 months or less. Project is expected to be non- jurisdictional) - Corps of Engineers Wetlands Permit (normally 60 days. Project is expected to qualify for a nation-wide permit) BCH is familiar with local public opinion regarding energy issues and no significant public opposition to this project is known or considered likely. BCH intends to work with the City of Skagway to develop the project for public benefit. 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. The hydro project footprint is entirely located on private land (USS 1560) owned by the grant applicant, Burro Creek Holdings, LLC. An easement from the State of Alaska will be required for the submarine cable from Burro Creek to Skagway, and from other land holders for on-shore infrastructure in Skagway. Specific property needs in Skagway may vary depending on the ultimate market for power, and will be identified as part of the business plan. 5.3 Project Technical & Environmental Risk 5.3.1 Technical Risk Describe potential technical risks and how you would address them.  Which tasks are expected to be most challenging?  How will the project team reduce the risk of these tasks?  What internal controls will be put in place to limit and deal with technical risks? Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 16 of 33 7/20/2020 See the “Common Planning Risks” section of the appropriate Best Practice Checklist for additional guidance. The proposed development scheme is straightforward and the technical elements of the project are generally similar to many other run-of-river hydros that have been built in Alaska over the years. Major technical risks for this type of project normally include: - Geotechnical risk. This will be mitigated through geotechnical inspection of the site, phased construction to expose site geology so designs can be adapted to verified physical site conditions, and budget contingency to address unknown conditions exposed during the course of construction. - Flood risk. High water events during construction of the diversion and/or powerhouse can disrupt construction, destroy partially constructed work, and/or delay tight construction schedules. Construction schedule and methods will need to be aware of flood risk to minimize exposure to this hazard at applicable phases of construction. - Logistical risk. Attention to detail and contingency planning are critical to managing schedules and budgets on a remote construction site. Providing reserve equipment, ample material reserve, inventory of critical equipment and parts, and knowledge of long-lead or difficult-to-procure items all will help to prevent unnecessary delays due to logistical problems. 5.3.2 Environmental Risk Explain whether the following environmental and land use issues apply, and if so which project team members will be involved and how the issues will be addressed. See the “Environmental and Permitting Risks” section of the appropriate Best Practice Checklist for additional guidance.  Threatened or endangered species  Habitat issues  Wetlands and other protected areas  Archaeological and historical resources  Land development constraints  Telecommunications interference  Aviation considerations  Visual, aesthetics impacts  Identify and describe other potential barriers No unusual environmental risks have been identified for this project to date. The permitting process proposed under this grant scope of work will address environmental risk items. 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. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 17 of 33 7/20/2020 Only complete sections applicable to your proposal. If your proposal only generates electricity, you can remove the sections for thermal (heat) generation. 5.4.1 Basic Operation of Existing Energy System Describe the basic operation of the existing energy system including: description of control system; spinning reserve needs and variability in generation (any high loads brought on quickly); and current voltage, frequency, and outage issues across system. See the “Understanding the Existing System” section of the appropriate Best Practice Checklist for additional guidance. Until the proposed business plan is completed, the applicable “existing energy system” is unknown. It may consist of one or more of the following: - The existing AP&T Haines – Skagway system - Cruise ships docked in Skagway self-generating ship power - New electricity markets such as space heating heat pumps, electric buses, electric ferry, or other markets. - Intertie to Yukon Territory and the energy markets of Yukon Energy. These markets will be described in detail in the business plan as they are scrutinized and evaluated for their compatibility with the Burro Creek electricity resource. 5.4.2.1 Existing Power Generation Units Include for each unit include: resource/fuel, make/model, design capacity (kW), minimum operational load (kW), RPM, electronic/mechanical fuel injection, make/model of genset controllers, hours on genset Unit 1: Kasidaya Creek Hydro (~3 MW, run of river) Unit 2: Goat Lake Hydro (~4 MW, storage) Unit 3: Dewey Lakes Hydro (multiple units ~942 kW aggregate, run of river / storage) Unit 4: Skagway Diesel Plant, ~3.4 MW aggregate capacity, multiple units) Unit 5: Haines Diesel Plant (~7.5MW aggregate capacity, multiple units) Unit 6: IPEC Klukwan Diesel Plant (~1 MW aggregate capacity, multiple units) Unit 7: IPEC 10-Mile Hydro (550 kW) 5.4.2.2 Existing Distribution System Describe the basic elements of the distribution system. Include the capacity of the step-up transformer at the powerhouse, the distribution voltage(s) across the community, any transmission voltages, and other elements that will be affected by the proposed project. 5.4.2 Existing Energy Generation Infrastructure and Production In the following tables, only fill in areas below applicable to your project. You can remove extra tables. If you have the data below in other formats, you can attach them to the application (see Section 11). Is there operational heat recovery? (Y/N) If yes estimated annual displaced heating fuel (gallons) None known. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 18 of 33 7/20/2020 AP&T has an existing 3-phase 35 kV (~15 MW) submarine cable between Skagway, Kasidaya Creek Hydro, and Haines. The cable is damaged between Skagway and Kasidaya Creek and could fail at any time. AP&T has single and three phase distribution circuits at various voltages throughout the communities of Haines and Skagway. In Haines, AP&T is interconnected with Inside Passage Electric Cooperative (IPEC), which serves the Chilkat Valley and Klukwan. 5.4.2.3 Existing Thermal Generation Units (if applicable to your project) Aggregate Energy Information for AP&T’s Skagway-Haines System and IPEC’s Klukwan-Chilkat Valley System Generation unit Resource/ Fuel type Design capacity (MMBtu/hr) Make Model Average annual efficiency Year Installed Hours Multiple Diesel N/A varies varies ~13.5 varies varies Month Diesel Generation (kWh) Hydro Generation (kWh) Fuel Consumption (Diesel-Gallons) Peak Load Minimum Load January not available (N/A) N/A N/A N/A N/A February N/A N/A N/A N/A N/A March N/A N/A N/A N/A N/A April N/A N/A N/A N/A N/A May N/A N/A N/A N/A N/A June N/A N/A N/A N/A N/A July N/A N/A N/A N/A N/A August N/A N/A N/A N/A N/A September N/A N/A N/A N/A N/A October N/A N/A N/A N/A N/A November N/A N/A N/A N/A N/A December N/A N/A N/A N/A N/A Total 195,640 28,900,000 14,400 5,900 N/A 5.4.2.4 O&M and replacement costs for existing units Power Generation Thermal Generation i. Annual O&M cost for labor TBD. NOT APPLICABLE. ii. Annual O&M cost for non-labor TBD. NOT APPLICABLE. iii. Replacement schedule and cost for existing units NOT APPLICABLE. NOT APPLICABLE. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 19 of 33 7/20/2020 5.4.2.5 Annual Heating Fuel Consumption (Existing System) Use most recent year. Include only if your project affects the recovered heat off the diesel genset or will include electric heat loads. Only include heat loads affected by the project. Not applicable for this project. 5.4.3 Future Trends Describe the anticipated energy demand in the community, or whatever will be affected by the project, over the life of the project. Explain how the forecast was developed and provide year by year forecasts. As appropriate, include expected changes to energy demand, peak load, seasonal variations, etc. that will affect the project. The existing AP&T energy system has been experiencing modest (0.9% per year) growth in recent years. Long term growth of the existing traditional energy market is expected to be flat to modestly growing. Emerging electricity markets, such as shore power for cruise ships, electric shuttle ferry, electric vehicles, and heat pumps, are expected to exhibit significant growth in the coming years. Skagway is an ideal market for electric vehicles powered by seasonally (summer) available run-of-river hydro due to the summer tourist season and short drive times for local tour operators, allowing frequent charging opportunities. These market opportunities would be quantified as part of the proposed business plan. 5.4.4 Proposed System Design Provide the following information for the proposed renewable energy system:  A description of renewable energy technology specific to project location  The total proposed capacity and a description of how the capacity was determined  Integration plan, including upgrades needed to existing system(s) to integrate renewable energy system: Include a description of the controls, storage, secondary loads, distribution upgrades that will be included in the project  Civil infrastructure that will be completed as part of the project—buildings, roads, etc.  Include what backup and/or supplemental system will be in place See the “Proposed System Design” section of the appropriate Best Practice Checklist for additional guidance. Proposed system will include: - A diversion and intake structure on BCH property at elevation 340 feet - An approximately 2,700 foot long by ~42-inch diameter penstock. - A powerhouse above the waterfall at elevation 80 feet. The powerhouse will include the turbine/generator, switchgear, controls, and associated equipment for plant operations. - A step up transformer from generation voltage to 12.47 kV. - An approximately one-mile overland transmission line from the powerhouse to tidewater. - A cable vault near tidewater at Burro Creek transitioning from upland transmission to a submarine cable. - An approximately 2-mile 15 kV three phase submarine cable from Burro Creek to Skagway. - on-shore cable vault along the Skagway coast (location TBD) and interconnection to existing grid. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 20 of 33 7/20/2020 The project will include the following supporting infrastructure: - Approximately 4,500 feet of construction access roads and trails. - Adaptation of the existing dock / barge landing area to accommodate construction deliveries. - Communications line integrated with submarine cable and coordinated with upland transmission infrastructure for project control and dispatch. 5.4.4.1 Proposed Power Generation Units Unit # Resource/ Fuel type Design capacity (kW) Make Model Expected capacity factor Expected life (years) Expected Availability 1 hydro ~1,840 TBD TBD ~40% 50 ~98% 5.4.4.2 Proposed Thermal Generation Units (if applicable) – Not Applicable 5.4.5 Basic Operation of Proposed Energy System  To the best extent possible, describe how the proposed energy system will operate: When will the system operate, how will the system integrate with the existing system, how will the control systems be used, etc.  When and how will the backup system(s) be expected to be used See the “Proposed System Design” section of the appropriate Best Practice Checklist for additional guidance. The run-of-river hydro will operate year-round, generating energy and transmitting it to markets in Skagway and/or beyond as will be identified in the proposed business plan. If the system is interconnected with the AP&T system, control lines will allow for coordination and dispatch of the burro creek synchronous generator for paralleling with the AP&T grid. Interconnection requirements and paralleling protocols would be determined in the project design phase. 5.4.3.1 Expected Capacity Factor ~40% 5.4.5.2 Annual Electricity Production and Fuel Consumption (Proposed System) Month Generation (Proposed System) (kWh) Generation (Type 2) (kWh) Generation (Type 3) (kWh) Fuel Consumption (Diesel- Gallons) Fuel Consumption [cfs of water, monthly median] Secondary load (kWh) Storage (kWh) January 10,000 N/A N/A 0 7 0 0 February 8,000 N/A N/A 0 6 0 0 Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 21 of 33 7/20/2020 March 6,000 N/A N/A 0 4 0 0 April 71,000 N/A N/A 0 15 0 0 May 974,000 N/A N/A 0 84 0 0 June 1,325,000 N/A N/A 0 110 0 0 July 1,269,000 N/A N/A 0 106 0 0 August 876,000 N/A N/A 0 70 0 0 September 1,030,000 N/A N/A 0 87 0 0 October 709,000 N/A N/A 0 60 0 0 November 77,000 N/A N/A 0 20 0 0 December 14,000 N/A N/A 0 11 0 0 Total 6,369,000 N/A N/A 0 N/A 0 0 See note at Section 12 of the application for the source of this data. 5.4.5.3 Annual Heating Fuel Consumption (Proposed System) (Not applicable) 5.4.6 Proposed System Operating and Maintenance (O&M) Costs O&M costs can be estimated in two ways for the standard application. Most proposed renewable energy projects will fall under Option 1 because the new resource will not allow for diesel generation to be turned off. Some projects may allow for diesel generation to be turned off for periods of time; these projects should choose Option 2 for estimating O&M. Option 1: Diesel generation ON For projects that do not result in shutting down diesel generation there is assumed to be no impact on the base case O&M. Please indicate the estimated annual O&M cost associated with the proposed renewable project. Per AEA program guidance annual O&M costs are projected for planning purposes at 1.35% of capital cost, or $250,000 per year. Option 2: Diesel generation OFF For projects that will result in shutting down diesel generation please estimate: 1. Annual non-fuel savings of shutting off diesel generation 2. Estimated hours that diesel generation will be off per year. 3. Annual O&M costs associated with the proposed renewable project. Because the nature and impact of the interconnect with the AP&T system has not been determined, no impact to diesel generation is assumed at this time. 5.4.7 Fuel Costs Estimate annual cost for all applicable fuel(s) needed to run the proposed system (Year 1 of operation) Diesel (Gallons) Electricity Propane (Gallons) Coal (Tons) Wood Other Unit cost ($) 0 Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 22 of 33 7/20/2020 Annual Units 0 ~40,000 kWh 0 0 0 0 Total Annual cost ($) station service kWh are part of plant generation. 5.5 Performance and O&M Reporting For construction projects only 5.5.1 Metering Equipment Please provide a short narrative, and cost estimate, identifying the metering equipment that will be used to comply with the operations reporting requirement identified in Section 3.15 of the Request for Applications. Plant switchgear and controls will include required sensors and logging capability to automatically collect plant generation and performance information. If the project is interconnected with the AP&T system, the power sales contract will include provisions by which AP&T will provide BCH with monthly reports detailing fuel savings (gallons) due to the project. No incremental cost is expected for infrastructure needed to comply with AEA reporting requirements. 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 The plant operator will maintain maintenance and repair logs. Relevant maintenance and repair activities will be summarized and reported to AEA on an annual basis for the required 10-year period. The labor effort to compile required data from BCH and AP&T, prepare annual reports, and respond to AEA reporting inquires is estimated at $5,000 annually. SECTION 6 – ECONOMIC FEASIBILITY AND BENEFITS 6.1 Economic Feasibility 6.1.1 Economic Benefit Annual Lifetime Anticipated Diesel Fuel Displaced for Power Generation (gallons) TBD. TBD. Anticipated Fuel Displaced for Heat (gallons) TBD. TBD. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 23 of 33 7/20/2020 Total Fuel displaced (gallons) TBD. TBD. Anticipated Diesel Fuel Displaced for Power Generation ($) TBD. TBD. Anticipated Fuel Displaced for Heat ($) TBD. TBD. Anticipated Power Generation O&M Cost Savings TBD. TBD. Anticipated Thermal Generation O&M Cost Savings TBD. TBD. Total Other costs savings (taxes, insurance, etc.) TBD. TBD. Total Fuel, O&M, and Other Cost Savings TBD. TBD. These items to be addressed in business plan. Please see narrative at 6.1.2. 6.1.2 Economic Benefit Explain the economic benefits of your project. Include direct cost savings and other economic benefits, and how the people of Alaska will benefit from the project. Note that additional revenue sources (such as tax credits or green tags) to pay for operations and/or financing, will not be included as economic benefits of the project. Where appropriate, describe the anticipated energy cost in the community, or whatever will be affected by the project, over the life of the project. Explain how the forecast was developed and provide year-by- year forecasts The economic model used by AEA is available at www.akenergyauthority.org/What-We-Do/Grants- Loans/Renewable-Energy-Fund-REF-Grants/2020-REF-Application. This economic model may be used by applicants but is not required. The final benefit/cost ratio used will be derived from the AEA model to ensure a level playing field for all applicants. If used, please submit the model with the application. The primary market for this project is not existing electric utility load, which in Skagway is mostly already supplied by hydropower. Rather, it is the adoption of new electric loads achieved through electrification of the Skagway port and associated activities. The Task 1.1 business plan would explore and quantify these opportunities. In concept, these new loads can include: - Electric car ferry serving the Haines / Skagway circuit. This ferry could be built in Alaska and powered by Burro Creek hydropower. Please see attached ferry spec sheet (Application Section 12). - Shore power for cruise ships docked in Skagway to displace on-board generation. - Electrification of the tour bus fleets and shuttle van fleets that operate from the Skagway harbor. A single electric tour bus charge cycle can draw several 100s of kWhs, and many dozens of busses operate in Skagway through the summer season. Establishing 20 charging stations to serve a fleet of 40 busses being charged twice daily would consume about ½ of Burro Creek’s summer output. Coordination of bus charging and tour schedules, real estate requirements for the charging depot, management of electric demand, and other factors would be addressed in the business plan to determine the merits of this market opportunity. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 24 of 33 7/20/2020 - In the shoulder and winter seasons, sale to AP&T to displace diesel generation and/or new space heating loads via resistance heaters or heat pumps could use the reduced output from the project these times of the year. Some of these loads may best be served in concert with the AP&T grid to use their additional hydropower capacity and/or utilize the storage capacity of Goat Lake and other future interconnected storage hydro projects. These coordination matters are items that would be addressed as part of the proposed business plan. 6.1.3 Economic Risks Discuss potential issues that could make the project uneconomic to operate and how the project team will address the issues. Factors may include:  Low prices for diesel and/or heating oil  Other projects developed in community  Reductions in expected energy demand: Is there a risk of an insufficient market for energy produced over the life of the project.  Deferred and/or inadequate facility maintenance  Other factors The main risk that nearly all Alaska hydro projects have encountered is construction cost risk, where the final installed cost of the projects has been significantly higher than estimates developed throughout the planning and design phases. Two examples of this include Battle Creek (~50% over budget, 2020 1, 2) and Blue Lake Dam Raise (~93% over budget, 2012 3). The current budget estimate is based on site conditions and recent cost experience for similar Alaska hydro projects. Cost estimates will be scrutinized during the business plan development phase of the project to reduce the potential of gross cost estimating errors. Other economic risks, such as future episodes of low-cost alternate fuels or energy alternatives, will depend on the specific market identified and contracts executed for the project’s electricity. For example, if electric vehicle (EV) deployment in Skagway is a major market, then the price risk from low- cost gas/diesel competition is low if the EV fleet does not have a flex-fuel / hybrid engine configuration. These and related factors will be reviewed as appropriate in the business plan. 1. Battle Creek Diversion TPS Report, 2011 Legislature ($31.5 million). 2. Battle Creek Completion Press Release, AEA, 8/27/2020 ($47 million). 3. Blue Lake Dam Raise Construction Award, KCAW article, 9/12/2012. ($96.7 million bid vs. $50 million engineer’s estimate). 6.1.4 Public Benefit for Projects with Direct Private Sector Sales For projects that include direct sales of power to private sector businesses (sawmills, cruise ships, mines, etc.), please provide a brief description of the direct and indirect public benefits derived from the project as well as the private sector benefits and complete the table below. See Section 1.6 in the Request for Applications for more information. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 25 of 33 7/20/2020 If directed energy sales are included in the final business plan for this project, the public benefit commensurate with grant proceeds will be reflected in reduced rates for energy sold to AP&T and/or IPEC. The business plan will include rate analysis and pro forma rates for these energy sales in accordance with the identified markets for electricity from the project. Also, BCH has signed a Memorandum of Understanding with the Municipality of Skagway for discussions and review of options for integrating BCH power into plans for Port of Skagway re-development and port electrification. Through this public process, a proposal will be developed to maximize the benefit of Burro Creek’s clean energy for residents and port users and give the Municipality options for port development and electrification that are not available under the existing power scenario. Renewable energy resource availability (kWh per month) See 5.4.5.2 Estimated direct sales to private sector businesses (kWh) To be determined. Revenue for displacing diesel generation for use at private sector businesses ($) To be determined. Estimated sales for use by the Alaskan public (kWh) To be determined. Revenue for displacing diesel generation for use by the Alaskan public ($) To be determined. 6.2 Other Public Benefit Describe the non-economic public benefits to Alaskans over the lifetime of the project. For the purpose of evaluating this criterion, public benefits are those benefits that would be considered unique to a given project and not generic to any renewable resource. For example, decreased greenhouse gas emission, stable pricing of fuel source, won’t be considered under this category. Some examples of other public benefits include:  The project will result in developing infrastructure (roads, trails, pipes, power lines, etc.) that can be used for other purposes  The project will result in a direct long-term increase in jobs (operating, supplying fuel, etc.)  The project will solve other problems for the community (waste disposal, food security, etc.)  The project will generate useful information that could be used by the public in other parts of the state  The project will promote or sustain long-term commercial economic development for the community 1. If BCH electricity can be used, solely or in concert with other existing hydropower in the region, to offset self-generation by cruise ships docked in Skagway, that will have a major benefit by improving local air quality during the summer season. 2. Similarly, implementation of an electric bus fleet and other electrification initiatives in Skagway will directly reduce exhaust emissions in the community, improving local air quality. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 26 of 33 7/20/2020 SECTION 7 – SUSTAINABILITY Describe your plan for operating the completed project so that it will be sustainable throughout its economic life. At a minimum for construction projects, a business and operations plan should be attached and the applicant should describe how it will be implemented. See Section 11. 7.1.1 Operation and Maintenance Demonstrate the capacity to provide for the long-term operation and maintenance of the proposed project for its expected life  Provide examples of success with similar or related long-term operations  Describe the key personnel that will be available for operating and maintaining the infrastructure.  Describe the training plan for existing and future employees to become proficient at operating and maintaining the proposed system.  Describe the systems that will be used to track necessary supplies  Describe the system will be used to ensure that scheduled maintenance is performed BCH has successfully operated an existing small hydro project (see 2011 feasibility study, application section 12)) at Burro Creek since purchase of the property in 2005. This project was installed in the early 1980s and has been kept in operational condition for nearly 40 years. BCH personnel are already experienced in the skills necessary to operate a remote run-of-river hydro. The new project will have slightly different operational requirements that will in some ways be easier than the existing hydro and in others more challenging. BCH will train its existing personnel to safely and efficiently operate the new system. Key personnel include: Jan Wrentmore, Grant Manager and Marketing Analyst Joel Groves, Polar Consult Engineering Liz Lavoie, Bookkeeper and Operations Manager Lisa Thoe, Sunset Accounting Jared Henley, Facilities Manager & Boat Driver Hamilton Construction (contractor previously hired for major maintenance items on the hydro) Operations and Maintenance Plans will be developed concurrent with plant construction to capture final design elements, as-built conditions, and relevant site and equipment information learned during construction. In general, these plans are expected to be developed as follows. Maintenance requirements will be identified in the operations and maintenance manuals furnished by various vendors during the construction phase. These diverse requirements will be captured in a unified concise O&M document specifying by major project element the pertinent O&M activities and intervals, with reference back to the individual O&M manuals for more specific details. The unified O&M manual will include maintenance logs that will be kept current by plant personnel. Critical spare parts requirements will also be pulled from the vendor operations and maintenance manuals, and an integrated list will be developed. Spare parts critical to plant operation and/or with Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 27 of 33 7/20/2020 long procurement lead times will be maintained in on-site inventory. In some instances, high-cost items may not be stocked if their cost is greater than the risk-weighted cost of a plant outage in the event of component failure. This analysis will also consider (as part of the business plan) the role of Burro Creek in the regional electric grid vis-à-vis the specific electricity market(s) served and the availability/cost of other backup generation options. 7.1.2 Financial Sustainability  Describe the process used (or propose to use) to account for operational and capital costs.  Describe how rates are determined (or will be determined). What process is required to set rates?  Describe how you ensure that revenue is collected.  If you will not be selling energy, explain how you will ensure that the completed project will be financially sustainable for its useful life. These matters cannot be answered until the specific market(s) for project electricity are defined. They will be addressed in the business plan. 7.1.2.1 Revenue Sources Briefly explain what if any effect your project will have on electrical rates in the proposed benefit area over the life of the project. If there is expected to be multiple rates for electricity, such as a separate rate for intermittent heat, explain what the rates will be and how they will be determined Collect sufficient revenue to cover operational and capital costs  What is the expected cost-based rate (as consistent with RFA requirements)  If you expect to have multiple rate classes, such as excess electricity for heat, explain what those rates are expected to be and how those rates account for the costs of delivering the energy (see AEA’s white paper on excess electricity for heat)..  Annual customer revenue sufficient to cover costs  Additional incentives (i.e. tax credits)  Additional revenue streams (i.e. green tag sales or other renewable energy subsidies or programs that might be available) These matters cannot be answered until the specific market(s) for project electricity are defined. They will be addressed in the business plan. Revenue sources will likely be structured in one (or both) of two ways as follows: 1. Wholesale electricity sale to AP&T and/or IPEC for resale to their end-users. This rate would be developed consistent with the cost-based rate defined in the RFA. 2. Direct energy sales to multiple prospective customer classes. These may include: - Affiliated interests pursuant to RCA regulations. If a business relationship is established with the City of Skagway, this could include all BCH and City properties. - Direct energy sales to cruise ships berthed in Skagway and/or to EV fleets operating out of Skagway. - Other markets as may be defined in the business plan, such as the Palmer Mine prospect near Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 28 of 33 7/20/2020 Haines, Yukon Energy intertie, or others. Incremental revenues may be realized through state or federal tax credits that may be available at the time of construction and/or from renewable energy credits that may exist on regulatory or voluntary markets once the project is operational. The decision to pursue these incremental revenue streams would depend on favorable analysis of the cost of securing the revenue stream and maintaining compliance with the applicable program(s) vs. the amount of revenue expected. 7.1.2.2 Power Purchase/Sale The power purchase/sale information should include the following:  Identification of potential power buyer(s)/customer(s)  Potential power purchase/sales price - at a minimum indicate a price range (consistent with the Section 3.16 of the RFA) Identify the potential power buyer(s)/customer(s) and anticipated power purchase/sales price range. Indicate the proposed rate of return from the grant-funded project. Include letters of support or power purchase agreement from identified customers. Power purchase agreements may be executed with one or more of the following entities: - AP&T for wholesale power from the project. - IPEC for wholesale power from the project - City of Skagway for directed energy sales from the project - Cruise ships for directed energy sales from the project - Tour operators or other EV users for directed energy sales from the project AP&T’s avoided cost of energy for diesel-fired generation is $0.145 to 0.30 per kWh depending on the cost of fuel. Avoided cost of energy for hydro generation is $0.05 to 0.15 per kWh depending on the resource and availability. Existing contracts may limit the ability of utility(ies) to purchase energy when existing hydro output is available. Please see also discussion at application section 7.1.2.1. SECTION 8 – PROJECT READINESS 8.1 Project Preparation Describe what you have done to prepare for this award and how quickly you intend to proceed with work once your grant is approved. Specifically address your progress towards or readiness to begin, at a minimum, the following:  The phase(s) that must be completed prior to beginning the phase(s) proposed in this application  The phase(s) proposed in this application  Obtaining all necessary permits  Securing land access and use for the project Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 29 of 33 7/20/2020  Procuring all necessary equipment and materials Refer to the RFA and/or the pre-requisite checklists for the required activities and deliverables for each project phase. Please describe below and attach any required documentation. BCH is ready to proceed with the stated scope of work immediately upon receipt of notice of award and execution of the grant agreement. - No outstanding work needs to be completed prior to commencement of the proposed work scope. - No permits are required for the proposed phase of study. Grant tasks 2.1 and 2.2 would obtain permits needed for project construction. - BCH already owns the land and has applied for water rights applicable to this project. - No equipment or material needs to be procured for the proposed phase of study. Stream gauging hardware is already installed and operational. 8.2 Demand- or Supply-Side Efficiency Upgrades If you have invested in energy efficiency projects that will have a positive impact on the proposed project, and have chosen to not include them in the economic analysis, applicants should provide as much documentation as possible including: 1. Explain how it will improve the success of the RE project 2. Energy efficiency pre and post audit reports, or other appropriate analysis, 3. Invoices for work completed, 4. Photos of the work performed, and/or 5. Any other available verification such as scopes of work, technical drawings, and payroll for work completed internally. Not applicable. SECTION 9 – LOCAL SUPPORT AND OPPOSITION Describe local support and opposition, known or anticipated, for the project. Include letters, resolutions, or other documentation of local support from the community that would benefit from this project. Provide letters of support, memorandum of understandings, cooperative agreements between the applicant, the utility, local government and project partners. The documentation of support must be dated within one year of the RFA date of July 20, 2020. Please note that letters of support from legislators will not count toward this criterion. No opposition to the project is known. Letters of support are included with the application. 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. Per Section 2.6 of this application, BCH received a grant under REF Round 1 for the 2011 Feasibility Study. BCH successfully completed all reporting requirements and the grant was successfully closed out. BCH has not received any other grants from AEA. Renewable Energy Fund Round 13 Grant Application – Standard Form AEA 21010 Page 30 of 33 7/20/2020 SECTION 11 – LIST OF SUPPORTING DOCUMENTATION FOR PRIOR PHASES In the space below, please provide a list of additional documents attached to support completion of prior phases. - BCH 2011 Hydro Feasibility Study SECTION 12 – LIST OF ADDITIONAL DOCUMENTATION SUBMITTED FOR CONSIDERATION In the space below, please provide a list of additional information submitted for consideration. The following documents are included with the application: - ADNR Water Rights Application and screenshot of ADNR current case management status. - 2016 Hydrology memo. - Deed to USS 1560 (111-2006-000138-0). - May 2020 Opinion of probable cost for hydro project. -Electric Shuttle Ferry Spec Sheet Please note the energy estimates in Section 5.4.5.2 of this application are based on this hydrology data and more refined analysis of penstock losses and turbine/generator efficiencies than were assumed in the 2016 hydrology memo. Estimated installed capacity is unchanged, but current estimated total energy output is higher than in the memo. Newer hydrology data from 2016 to 2020 has not yet been reduced. The stream gauge remains in service, with new instrumentation and data loggers installed earlier in 2020.