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HomeMy WebLinkAboutOldHarborHydroRound9ApplicationPackageFinalRenewable Energy Fund Round IX Grant Application Old Harbor Hydroelectric Project Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 1 of 35 8/11/15 SECTION 1 –APPLICANT INFORMATION Please specify the legal grantee that will own, operate, and maintain the project upon completion. Name (Name of utility, IPP,local government,or other government entity) Alaska Village Electric Cooperative, Inc. Type of Entity:Fiscal Year End: Not-for-profit December 31 Tax ID # Tax Status:☐For-profit ☒Non-profit ☐Government (check one) Date of last financial statement audit:March 19, 2015 Mailing Address:Physical Address: 4831 Eagle Street 4831 Eagle Street Anchorage, AK. 99503 Anchorage, AK. 99503 Telephone:Fax:Email: 800.478.1818 800.478.4086 sgilbert@avec.org 1.1 Applicant Point of Contact / Grants Manager Name:Title: Steve Gilbert Manager, Projects Development and Key Accounts Mailing Address: 4831 Eagle Street Anchorage, AK 99503 Telephone:Fax:Email: 907.565.5357 907.561.2388 sgilbert@avec.org 1.1.1 APPLICANT SIGNATORY AUTHORITY CONTACT INFORMATION Name:Title: Meera Kohler President and CEO Mailing Address: 4831 Eagle Street Anchorage, AK 99503 Telephone:Fax:Email: 907.565.5351 907.561.4086 mkohler@avec.org 1.1.2 Applicant Alternate Points of Contact Name Telephone:Fax:Email: N/A Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 2 of 35 8/11/15 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, or ☐An independent power producer in accordance with 3 AAC 107.695 (a) (1), or ☐A local government, or ☐A governmental entity (which includes tribal councils and housing authorities) 1.2 APPLICANT MINIMUM REQUIREMENTS (continued) Please check as appropriate. ☒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 gover ning authority is necessary.(Indicate 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 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 http://www.akenergyauthority.org/Programs/Renewable-Energy-Fund/Rounds#round9.(Any exceptions should be clearly noted and submitted with the application.)(Indicate 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 IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 3 of 35 8/11/15 SECTION 2 –PROJECT SUMMARY 2.1 Project Title Provide a 4 to 7 word title for your project. Type in the space below. Old Harbor Hydroelectric Project −Geotechnical Study and Final Design 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 at 907-771-3031. Old Harbor is located on the southeast coast of Kodiak Island, 70 miles southwest of the City of Kodiak and 322 miles southwest of Anchorage.It lies at approximately 57.197222 North Latitude and -153.307778 West Longitude. 2.2.2 Community benefiting –Name(s) of the community or communities that will be the beneficiaries of the project. The residents, businesses, local government, and tribe of Old Harbor (population of 213 -DCCED Commissioner Certified Figure, 2014 )will be the beneficiaries of this project. 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 IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 4 of 35 8/11/15 2.4 Project Description Provide a brief one paragraph description of the proposed project. The Alaska Village Electric Cooperative (AVEC), the electrical utility provider in Old Harbor, is proposing to complete geotechnical field work and final design for a hydroelectric project in Old Harbor, Alaska. The 262 kilowatt (kW) (initial; nominal) basin diversion project will be located on East Fork Mountain Creek and Lagoon Creek Tributary. The project will be capable initially of generating an average of about 2,300,000 kilowatt-hours (kWh) annually and could grow to an annual generation of 3,520,000 kWh when demand warrants and an additional turbine is installed. The project will run year-round and meet all the existing and future electricity demands of the community. Power from the facility would also be used to heat the school,saving up about 8,370 gallons of diesel heating fuel annually. 2.5 Scope of Work Provide a 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. AVEC is seeking funds to complete a geotechnical investigation and final design of the Old Harbor Hydroelectric Project.For the geotechnical investigation, work would include contracting with a geotechnical firm, developing a study and fieldwork plan, completing helicopter-supported geotechnical fieldwork at the intake site, and documenting the results in a final report. Final design work will include completing 65%, 95%, and 100% designs (including working with regulatory agencies on design as required by the FERC license) and drafting specifications.When this critical work is completed, AVEC will be able to seek and acquire funding for construction of the project. SECTION 3 –Project Management, Development, and Operation 3.1 Schedule and Milestones Criteria:Stage 2-1.A: The proposed schedule is clear, realistic, and described in adequate detail. 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 in 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 of your proposed project. Add additional rows as needed. The timing for this grant award and completion of the grant tasks is ideal to keep the project moving towards construction. All environmental permits would be issued prior to or with the FERC License by the end of 2016.This phase of the project would incorporate the license and permit requirements into the final design and construction stipulations by August 2017. The project schedule is shown in the table on the next page. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 5 of 35 8/11/15 Milestones Tasks Start Date End Date Deliverable s 1. Project scoping and contractor solicitation AVEC would secure a contractor for geotechnical fieldwork and final design Aug 2016 Aug 2016 Contract 2. Permit applications Completed; permit applications have been submitted. n/a 3. Final environmental assessment and mitigation plans FERC license application was submitted in October 2013; no work under this grant is proposed. n/a 4. Resolution of land use, right of way issues Work towards acquiring ROW is underway; no work under this grant is proposed. n/a 5. Permitting, rights-of- way, site control Permitting and ROW acquisition will be completed; no work under this grant is proposed. n/a 6. Final system design Intake geotechnical fieldwork Geotechnical crew will complete work at the intake area of the project.Aug 2016 Dec 2016 Geotechnica l report Geotechnical report A report will be completed detailing the geotechnical conditions at the intake. Oct 2016 Dec 2016 Geotechnica l report 65% design Oct 2016 April 2017 65% design report 95% design May 2017 July 2017 95% design report 100% design & specs Aug 2017 Aug 2017 100% design and specificatio ns 7. Final cost estimate May 2017 Aug 2017 Final cost estimate 8. Updated economic and financial analyses Work was completed during FERC licensing process; no work under this grant is proposed. n/a 9. Power or heat sale agreements in place An agreement with the Kodiak Island Borough School District will be drafted for a hydro to heat system. May 2017 Jun 2017 Heat sales agreement 10. Final business and operational plan completed As required by FERC,operational plan will be developed and completed.Apr 2017 Aug 2017 Final operational plan Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 6 of 35 8/11/15 3.2 Budget Criteria:Stage 2-1.B: The cost estimates for project development, operation, maintenance, fuel, and other project items meet industry standards or are otherwise justified. 3.2.1 Budget Overview Describe your financial commitment to the project. List the amount of funds needed for project completion and the anticipated nature and sources of funds. Consider all project phases, including future phases not covered in this funding request. Total anticipated project cost, and cost for this phase/requested grant funding/matching funds. To date,AVEC has acquired $762,500 on design and permitting phase of this project.This application is to complete geotechnical field work and design including the final design for a hydroelectric project in Old Harbor. Geotechnical field work and reporting will cost $500,000. Design will cost $650,000. A combined total of $1,150,000 will be needed to complete this work. AVEC is requesting $1,092,500 from AEA through the REF grant program,and AVEC will provide $57,500 as a cash match for this phase. Identification of other funding sources.Recognizing the trend AEA has established and references in the REF Round IX grant guidance for encouraging other-than-REF funds for construction phase projects, AVEC will research and apply for federal grants or grant/loan funds for the construction phase of this project.It is possible that the funding for future work could come from a combination of AEA’s Renewable Energy Fund program, USDA Rural Utility Service Program, another grant program, or direct appropriation from the State or Federal government.If unsuccessful in pursuing grant funds, AVEC would look to loan programs for the construction of the Old Harbor Hydroelectric Project. Projected capital cost of proposed renewable energy system/projected development cost of proposed renewable energy system.AVEC expects the final construction of the project will cost $8,405,000 ($8,155,000 [FERC license application estimate] + $250,000 [school heat recovery system]).This cost includes the second hydroelectric turbine and school boiler heat recovery system. AVEC anticipates it will provide a 10% cash match for the construction project. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 7 of 35 8/11/15 3.2.2 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.The milestones and tasks should match those listed in 3.1 above. Milestone or Task RE-Fund Grant Funds Grantee Matching Funds Source of Matching Funds: Cash/In- kind/Federal Grants/Other State Grants/Other TOTALS 1. Project scoping and contractor solicitation completed n/a n/a n/a 2. Permit applications completed n/a n/a n/a 3. Final environmental assessment and mitigation plans completed n/a n/a n/a 4. Resolution of land use,right of way issues n/a n/a n/a 5. Permitting, rights-of-way,site control completed n/a n/a n/a 6. Final system design completed n/a n/a n/a Intake geotech fieldwork $427,500 $22,500 Cash $450,000 Geotech report $47,500 $2,500 Cash $50,000 65% design $308,750 $16,250 Cash $325,000 95% design $154,375 $8,125 Cash $162,500 100% design and specs $95,000 $5,000 Cash $100,000 7. Final cost estimate completed $59,375 $3,125 Cash $62,500 8. Updated economic and financial analyses completed $$$ 9. Power or heat sale agreements in place $$$ 10. Final business and operational plan completed $$$$ TOTALS $1,092,500 $57,500 $1,150,000 Budget Categories: Direct Labor & Benefits $95,000 $5,000 Cash $100,000 Travel & Per Diem $$$ Equipment $$$ Materials & Supplies $$$ Contractual Services $997,500 $52,500 Cash $1,050,000 Construction Services $$$ Other $$$ TOTALS $1,092,500 $57,500 $1,150,000 Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 8 of 35 8/11/15 3.2.3 Cost Justification Indicate the source(s)of the cost estimates used for the project budget. Cost estimates and budget for this phase were produced by AVEC’s consulting engineers and can be made available upon request. 3.2.4 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 $1,092,500 Cash match to be provided $57,500 In-kind match to be provided $ Total costs for project phase(s) covered in application (sum of above)$1,150,000 3.2.5 Total Project Costs Indicate the anticipated total cost by phase of the project (including all funding sources). Use actual costs for completed phases. Reconnaissance $ Feasibility and Conceptual Design (previous REF)$250,000 Final Design and Permitting (previous REF + CDBG + this request)$1,662,500 Construction (FERC License estimate + school heat system)$8,405,000 Total Project Costs (sum of above)$10,317,500 3.2.6 Operating and Maintenance Costs O&M costs can be estimated in two ways for the standard application. Most proposed RE 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. Options O&M Impact of proposed RE project Option 1: Diesel generation ON For projects that do not result in shutting down diesel generation there is assumed to be no impact on the base case O&M. Please indicate the estimated annual O&M cost associated with the proposed renewable project. Option 2: Diesel generation OFF For projects that will result in shutting down diesel generation please estimate: 1.Annual non-fuel savings of shutting off diesel generation 2.Estimated hours that diesel generation will be off per year. 3.Annual O&M costs associated with the proposed renewable project. 1.$170,000 2.Hours diesel OFF/year:Most, if not all 3.$85,000 (based on analysis reported in FERC license application) Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 9 of 35 8/11/15 3.3 Project Communications Criteria:Stage 2-1.C: The applicant’s communications plan, including monitoring and reporting, is described in adequate detail. Describe how you plan to monitor the project and keep the Authority informed of the status. The project will be managed out of AVEC’s Projects Development Department. For financial reporting, the Projects Development Department’s accountant, supported by the Administrative Services Department, will prepare financial reports. The accountant will be responsible for ensuring that vendor invoices and internal labor charges are documented in accordance with AEA guidelines. AVEC has up-to-date systems in place for accounting, payables, financial reporting, and capitalization of assets in accordance with AEA guidelines. During the project, AVEC will receive invoices from and converse with major contractor(s) to monitor the project’s invoicing and progress.Satisfactory reporting and backup from major contractor(s) will be provided to AVEC, which will be used to draft progress reports. These progress reports will be forwarded to the AEA project manager each quarter.The progress reports will include a summary of tasks completed, issues or problems experienced, upcoming tasks, and contractor’s needs from AVEC. Quarterly face-to-face meetings will occur between AVEC and AEA to discuss the status of all projects funded through the AEA Renewable Energy Grants program. Individual project meetings will be held, as required or requested by AEA. Meera Kohler, AVEC’s President and CEO, may be contacted as an alternative manager. 3.4 Operational Logistics Criteria:Stage 2-1.D: Logistical, business, and financial arrangements for operating and maintaining the project throughout its lifetime and selling energy from the completed project are reasonable and described in adequate detail. Describe the anticipated logistical, business, and financial arrangements for operating and maintaining the project throughout its lifetime and selling energy from the completed project. AVEC has the capacity and experience to administer this grant and manage this project, if funded. As a local utility that has been in operation since 1968, AVEC is completely able to finance, operate, and maintain this project for its design life. AVEC has operated other renewable projects throughout the state and is very familiar with planning, constructing, operating, and maintaining alternative energy generation systems. Business plan structures and concepts which may be considered:The hydroelectric power will be incorporated into AVEC’s power plant operation. Local plant operators provide daily servicing. AVEC technicians provide periodic preventative or corrective maintenance and are supported by AVEC headquarters staff, purchasing, and warehousing. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 10 of 35 8/11/15 How O&M will be financed for the life of the project:As with all AVEC power plants, the costs of operations and maintenance will be funded through ongoing energy sales to the member villages. Operational issues which could arise:AVEC does not envision any operational issues. No environmental flows have been proposed by regulatory agencies, which will allow for adequate operational flows year round. The intake area will be accessible throughout the year via small pickup truck or ATV and any minor issues at the intake could be handled locally. SECTION 4 –QUALIFICATIONS AND EXPERIENCE 4.1 Project Team Criteria:Stage 2-2.A: The Applicant, partners, and/or contractors have sufficient knowledge and experience to successfully complete and operate the project. If the applicant has not yet chosen a contractor to complete the work, qualifications and experience points will be based on the applicant’s capacity to successfully select contractors and manage complex contracts. Criteria:Stage 2-2.B: The project team has staffing, time, and other resources to successfully complete and operate the project. Criteria:Stage 2-2.C: The project team is able to understand and address technical, economic, and environmental barriers to successful project completion and operation. Criteria:Stage 2-2.D: The project team has positive past grant experience. 4.1.1 Project Manager Indicate who will be managing the project for the Grantee and include contact information,and a resume. In the electronic submittal, please submit resumes as separate PDFs if the applicant would like those excluded from the web posting of this application. 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. AVEC, as the electric utility serving Old Harbor, will provide overall project management and oversight. Steve Gilbert, Manager, Projects Development and Key Accounts Department Steve Gilbert has served as manager of the Projects Development and Key Accounts Department for AVEC since 2012 where he leads a team focused on lowering the cost of energy in rural Alaskan villages through improved power plant efficiency, wind and other renewable power generation, and interties between villages. Previously, Mr. Gilbert worked at Chugach Electric for 17 years managing three power plants and served as lead electrical engineer for a 1 MW fuel cell and micro-turbine projects and wind energy project development.Mr. Gilbert is recognized as an industry leader on wind energy and has been active on a national level in operation and maintenance of wind power plants.Mr. Gilbert was Alaska’s Electrical Engineer of the Year in 2000 and for the 12 western states in 2001.He has been a regular lecturer at schools and universities on renewables, especially wind. He also worked with BP Wind in London assessing European wind prospects. To better evaluate investment opportunities for his employer, Mr. Gilbert recently completed his MBA. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 11 of 35 8/11/15 Meera Kohler, President and CEO of AVEC Ms. Kohler has more than 30 years of experience in the Alaska electric utility industry. She was appointed Manager of Administration and Finance at Cordova Electric Cooperative in 1983, General Manager of Naknek Electric Association in 1990, and General Manager of Municipal Light & Power in Anchorage in 1997. Since May 2000, Ms. Kohler has been the President and CEO of AVEC and in this position has ultimate grant and project responsibilities. 4.1.2 Expertise and Resources Describe the project team including the applicant, partners, and contractors. Provide sufficient detail for reviewers to evaluate: •the extent to which the team has sufficient knowledge and experience to successfully complete and operate the project; •whether the project team has staffing, time, and other resources to successfully complete and operate the project; •how well the project team is able to understand and address technical, economic, and environmental barriers to successful project completion and operation. 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. Include brief resumes for known key personnel and contractors 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 AVEC has been providing electrical services to rural, isolated, and economically disadvantaged Alaskan communities since 1968. The cooperative began with three communities and a very small staff, and has steadily grown to the impressive non-profit organization it is today with 56 member villages. AVEC now has over 90 employees with managers, engineers, expediters,customer service,and others in its Anchorage central office and Bethel hub office,plus plant operators within the communities. Since 2000, AVEC has reliably and responsibly spent over $212 million of grant funds and its own money to construct over 80 major projects. This includes 29 bulk fuel tank farm upgrades or replacements, 12 new diesel-fired power plants, 4 standby backup power plants, 4 recovered heat systems, 11 wind farms (34 total wind turbines), 5 village-to-village interties, 1 PV solar array, and 17 other generation and distribution upgrades. Funding for these projects has come from the Denali Commission ($181 million), the Alaska Energy Authority ($24 million), USDA Rural Utilities Service direct awards ($9 million), other grants ($3 million) and AVEC matching contributions ($20 million). AVEC will use a project management strategy that has been used to successfully design and construct its renewable energy projects throughout rural Alaska. That strategy includes a team of AVEC staff and external consultants. AVEC staff members and their roles on this project include: Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 12 of 35 8/11/15 Meera Kohler, President and Chief Executive Officer, will act as Project Executive and will maintain ultimate programmatic and financial authority. Steve Gilbert, Projects Development Manager, will act as Program Manager and will lead the project management team consisting of AVEC staff, consultants, and contractors. Debbie Bullock, Manager of Administrative Services, will provide support in accounting, payables, financial reporting, and capitalization of assets in accordance with AEA guidelines. Bill Stamm, Manager of Engineering, leads AVEC’s Engineering Department, which is responsible for in-house design of power plants,distribution lines, controls, and other AVEC facilities. Mr. Stamm’s unit will provide engineering design review. Mark Bryan, Manager of Operations, is a Certified Journeyman Electrician and supervises AVEC’s line operations, generation operation, and all field construction programs.He has worked at AVEC since 1980, was appointed Manager of Construction in May 1998, and was promoted to Manager of Operations in June 2003.Mr. Bryan’s unit will oversee operation of this project as part of the AVEC utility system, once constructed. Anna Sattler, Community Liaison, will communicate directly with Old Harbor residents and key entities to ensure the community is informed. Steve Gilbert will be responsible for the management of this project. He will be responsible for working with AVEC’s Community Liaison to involve the community in the project and gain site control. He will also coordinate and manage the following consultants while ensuring that their deliverables are on time and within budget: Geotechnical Consultant.AVEC would select and employ an experienced geotechnical consultant who would conduct a detailed geotechnical and natural hazards field study and report of areas along the intake access road and at the intake. Engineering Consultant.AVEC would select and employ an experienced engineering consultant to complete final design of this project. Environmental Consultant.Solstice Alaska Consulting, Inc. (Solstice) is under contract to help with project management and permitting. Solstice prepared the license application and permit applications for this project and continues to work with agencies to ensure that the licensing and permitting process moves forward. Selection Process for Contractors:The geotechnical and engineering consultant selection would be based upon technical competencies, past performance, written proposal quality, cost, and general consensus from the technical steering committee. The selection of the consultant would occur in strict conformity with corporate procurement policies, conformance with OMB circulars, and DCAA principles. Resumes are included under Tab A, which is provided as a separate document. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 13 of 35 8/11/15 4.1.3 Project Accountant(s) Indicate who will be performing the accounting of this project for the grantee and include a resume. In the electronic submittal, please submit resumes as separate PDFs if the applicant would like those excluded from the web posting of this application. If the applicant does not have a project accountant indicate how you intend to solicit financial accounting support. Debbie Bullock, Manager of Administrative Services,will provide support in accounting,payables, financial reporting, and capitalization of assets in accordance with AEA guidelines.Debbie’s bio is included under Tab A. 4.1.4 Financial Accounting System 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 Renewable Energy Fund Grant Program. AVEC’s accounting system consists of software, procedures and controls driven by the daily inputs and other actions of competent employees throughout the organization. The software is comprised of a comprehensive suite of Daffron-brand modules including accounting (payables/payroll/general ledger), work orders, purchase orders, customer service and billing, and warehouse/inventory. Some ancillary functions are accomplished on spreadsheets with data downloaded from the various Daffron modules. Procedures and controls include but are not limited to adequate separation of duties, manager- level approval of all expenditures, CEO-level approval of all major expenditures, a formal purchasing system (including purchase orders) for acquisition of materials and components, and a formal contracting system (including task orders) for acquisition of contractual services (consultants,construction, etc.). Virtually all AVEC employees are users of the accounting system, at least to a minimal extent. Primary users include:the Accounting Department; all managers due to their involvement in controlling and ensuring the propriety of costs; and the Projects Development and Key Accounts Department, particularly its Project Manager, its Office Administrator and its Senior Accountant; these three employees are primarily responsible for all grant reporting. AVEC’s team, with years of experience and knowledge of managing AEA-funded project costs and grant reimbursements, has a system in place for ensuring that only costs that are reasonable, ordinary, and necessary are charged to a Project, and that only costs that are eligible are submitted for reimbursement. First, AVEC’s project manager is responsible for determining whether costs are appropriate and acceptable. The project manager reviews all invoices from contractors and vendors and all in-house labor and equipment charges. Second,the Projects Development and Key Accounts Department Manager reviews costs associated with outsourced services, including consultant and contractor invoices, to ensure that the charges are reasonable. The department manager also reviews his department’s staff labor charges (timesheets) to the Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 14 of 35 8/11/15 project. Third, the Operations and Engineering Department Managers review all in-house labor (timesheets) and expense reports for their respective departments to make sure that the charges are acceptable. Finally, the Projects Development and Key Accounts Department Senior Accountant, while preparing AEA financial reports and reimbursement requests, provides a review of both outsourced and in-house charges to determine whether they are allowable costs. The Senior Accountant has eight years of experience with REF grant reporting and grant agreements and understands what costs would be accepted by AEA. AVEC has systems in place to keep unacceptable overhead costs from being charged to and reimbursed through the REF Grant Fund Program. Upon project initiation, an AVEC work order number is created to track all project labor and expenses. AVEC staff and contractors reference this number on all timesheets and invoices when working on the project, ensuring that project costs are known. Purchase orders are universally used to establish spending limits for purchases of materials, which are then monitored by the Accounting Department through the enterprise accounting system. Task orders and contracts are universally used to establish spending limits for purchases of contractual services, which are then monitored by the Project Development and Key Accounts Department utilizing spreadsheets. Direct labor expenses (gross payroll) are tracked separately from overhead costs including employee benefits and payroll taxes. Once labor hours have been calculated, overhead including employee benefits and payroll taxes are applied in a separate transaction on the work order. AVEC and AEA have an agreed rate cap for employer costs of payroll, consisting only of employee benefits and payroll taxes. AVEC can ensure that only allowable costs would be requested for reimbursement because the direct labor and indirect/overhead costs are separate transactions (and thus the indirect/overhead amounts can be easily omitted from reimbursement), and because the allowable rate has been established and agreed upon (and thus can be easily included for reimbursement). 4.2 Local Workforce Criteria:Stage 2-2.E: The project uses local labor and trains a local labor workforce. Describe how the project will use local labor or train a local labor workforce. AVEC uses local labor whenever possible in both daily operations and special projects; recognizing that local labor is good for its customers’ families. Local wages circulate, often multiple times, within the community thereby benefitting the community as a whole. AVEC project managers also know there are tasks that are more competently done by local folks; for example, bear guards, bird monitors and four-wheel drivers. It is typical that local labor saves money within special project budgets as demonstrated in comparing budgets with local labor wages against imported labor wages, travel and per diem. This is true for not only its own projects but also for its contractors. Therefore, AVEC addresses local Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 15 of 35 8/11/15 labor in its bid documents as appropriate and allowed by law. For example, Part of the Contractor’s Responsibilities in the Emmonak bid documents says: “Local Labor and Local Firms Participation Goal:The participation goal for this project has been established as a percentage of the total dollar amount awarded to the successful bidder in the amount of 20% to local labor and local firms. The successful bidder shall provide the Owner documentation to demonstrate compliance with this goal. If this goal cannot be reached and good faith efforts were demonstrated through documentation to the Owner, the Owner has the right to issue a variance to this section.” Also, from the New Stuyahok bid documents: “Use of Local Labor and Local Firms:To the maximum extent practicable, CONTRACTOR shall accomplish the Project using local labor and Alaska firms.” In most AVEC communities the power plant operators are employees of their city government. Through a contract process, AVEC reimburses the city for the wages and fringe benefits of the power plant operators. During project feasibility, design and construction phases, plant operators provide necessary assistance; typically with tasks like bird monitoring, taking photographs, changing SIM cards, hosting and assisting engineers and others coming into the community for project work. AVEC is very proud of its training program wherein power plant operators are trained by an itinerant training supervisor who travels continuously to AVEC communities and works one-on-one with the operators as needed and throughout the year. SECTION 5 –TECHNICAL FEASIBILITY 5.1 Resource Availability Criteria:Stage 2-3.A: The renewable energy resource is available on a sustainable basis, and project permits and other authorizations can reasonably be obtained. 5.1.1 Proposed Energy Resource Describe the potential extent/amount of the energy resource that is available, including average resource availability on an annual basis.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. 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. This project will utilize water taken from the East Fork of Mountain Creek. Stream gauging efforts by the State of Alaska Department of Natural Resources water division from July 1993 to May 1996 and by PolarConsult from June 1998 to August 2000 indicate that there is adequate water to meet Old Harbor's energy needs year-round. The maximum, mean, and minimum annual flows for the East Fork of Mountain Creek, based on the Mountain Creek Hydrology Report are approximately Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 16 of 35 8/11/15 100 cubic feet per second (cfs), 14.2 cfs, and 3 cfs, respectively (PolarConsult 2010). The project is currently sized to utilize a maximum of 11.8 cfs, but will initially use 5.9 cfs. The project has a maximum gross head of about 760 feet and results in a 296 kW installed peak output. The initial installed nominal capacity is 262 kW. Estimated average annual generation for electric and heat energy is 2,300,000 kWh (based on initial installation of 1 turbine and 296 peak output). Clearly this resource is able to provide a significant benefit to the community.Similar to other run-of-river projects in Alaska, the drawback with this resource is the lower power output during the winter and spring. However, given that Old Harbor's current peak load is about 100 kW and the minimum available power in the springtime is about 140 kW,this is currently not an issue. Once community demand warrants, an additional turbine will be installed at the powerhouse.The project will be constructed initially to accommodate the larger project but will not include the second turbine. The project will then output 525 kW or 3,520,000 kWh/year (nominal and peak) using 11.8 cfs. The project will acquire a FERC license for the larger project, so that relicensing will not be needed in the future. Other energy resources are not feasible for the following reasons: A wind meteorological tower installed on Sitkalidak Island near Old Harbor to assess the wind resource found that wind will not be suitable for community power. The installed cost of photovoltaic solar arrays will be higher per kW produced than the installed costs of the hydroelectric project. Generating power from the hydrokinetic power is not yet an established technology or commercially available technology. Biomass resources are limited by the lack of resources near the community. 5.1.2 Permits Provide the following information as it may relate to permitting and how you intend to address outstanding permit issues. List of applicable permits Anticipated permitting timeline Identify and describe potential barriers The timing for this grant award and issuance of permits is ideal. All permits would be issued prior to or concurrent with the FERC License by the end of 2015. The phase of the project proposed in this grant application would incorporate the license and permit requirements into the final design and construction stipulations by August 2017. Federal Energy Regulatory Commission (FERC)-Hydropower Project License. AVEC worked closely with FERC in preparation of the FERC license application. AVEC does not expect any barriers to licensing. The anticipated licensing timeline is outlined below. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 17 of 35 8/11/15 AVEC submitted the License Application to FERC on October 31,2013. FERC issued the Notice of Application Tendered for Filing on November 1,2013. FERC issued the Ready for Environmental Analysis and outlined a project schedule on June 10, 2014. Comments on the license application,filing of recommendations,preliminary terms and conditions, and preliminary fishway prescriptions were submitted by USFWS and ADF&G to FERC on August 8 and 11,2014,respectively. AVEC responded to ADF&G and USFWS comments on September 15, 2014. FERC issued a draft EA in March 2016. Comments were submitted to FERC by AVEC and the City, Tribe, and Corporation of Old Harbor in July 2015. FERC will issue their EA in November 2015. AVEC will use the information in the license to complete final design, funded by this grant. U.S. Fish and Wildlife Service -Right of Way Permit. Portions of the Old Harbor Hydroelectric Project are within the Kodiak National Wildlife Refuge. AVEC is working closely with the USFWS’ Division of Realty and Conservation Planning to ensure that right of way will be issued. The anticipated Right of Way timeline is outlined below: AVEC submitted an Application for Right of Way in November 2014. USFWS will issue the Right of Way following issuance of the FERC License. AVEC will incorporate Right of Way stipulations in the final design, funded by this grant. U.S. Army Corps of Engineers (USACE)-Wetlands Permit. AVEC has been working with the USACE in the wetland permitting process. The anticipated permitting timeline is outlined below. AVEC does not expect any barriers to the issuance of a Department of the Army (DA) permit. The USACE issued a Jurisdictional Determination (JD) for the project area on November 11, 2011. AVEC completed wetlands delineation work in areas that were not previously mapped in April 2014 and requested an amended JD from the USACE on May 28, 2014. The USACE issued a preliminary JD for the entire project area in November 2014. AVEC submitted a wetlands permit application in December 2014 and has been working with the agency to address questions. AVEC expects this permit to be issued by December 2015. State of Alaska, Department of Environmental Conservation -Water Quality Certificate. On July 15, 2014,ADEC issued a Water Quality Certification waiver for this project. State of Alaska, Department of Natural Resources (ADNR) Division of Mining, Land, and Water –Application for Water Right. ADNR stated in an email dated July 31, 2014, that water rights will be issued for the project when the FERC license is issued. ADNR has all needed application materials. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 18 of 35 8/11/15 State of Alaska, Alaska Department of Fish and Game –Fish Habitat Permit. ADF&G stated in an email dated August 6, 2014, that the Fish Habitat Permit will be issued for the project when the FERC license is issued. ADF&G has all needed application materials. Kodiak Island Borough Land Use Permit. The project will be located within the Kodiak Island Borough and as such is required to comply with land use regulations.The Borough issued a Conditional Use Permit for the project in April 2015. 5.2 Project Site Criteria:Stage 2-3.B: A site is available and suitable for the proposed energy system. 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. There are no issues with land ownership and the site has been proven to be suitable for the proposed energy system. Old Harbor Native Corporation, who owns approximately 3.24 acres within the project area,and the City of Old Harbor, who owns approximately 1.12 acres within the project area, are project partners and have stated that they will provide land for the project. AVEC is working with USFWS to obtain approximately 5.89 acres of right-of-way for the project within the Kodiak National Wildlife Refuge. AVEC has been collaborating with the USFWS for over 5 years regarding right-of-way and does not foresee issues with this approval. As requested by USFWS, an application for right-of-way was submitted in April 2015 (9 months before issuance of the license). USFWS stated that the ROW will be granted once the FERC license is issued at the end of 2015. A conservation easement administered by the State of Alaska and USFWS and held by the Exxon Valdez Oil Spill Trustee Council covers some portions of the Kodiak National Wildlife Refuge and Old Harbor Native Corporation Land where the project is located. ADNR is responsible for issuing an amendment to the conservation easement to allow construction and operation of the project. ADNR provided a letter stating that they will issue the amendment once the FERC License has been issued at the end of 2015. 5.3 Project Risk Criteria:Stage 2-3.C: Project technical and environmental risks are reasonable. 5.3.1 Technical Risk Describe potential technical risks and how you would address them. As detailed below,there are minimal risks associated with this project. In fact, timing for this project is ideal because the FERC license and permits would be issued right before final design Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 19 of 35 8/11/15 (proposed in this application) is initiated. There would be seamless incorporation of the license and permit requirements into the final design and construction stipulations. FERC License Acquisition.AVEC sees no problems with the issuance of the FERC license. The FERC application was submitted to FERC on October 31, 2013 and the Commission issued their Ready for Environmental Analysis (REA) on June 10, 2014. Only minor comments on the application were received from USFWS and Alaska Department of Fish and Game (ADF&G) on August 11, 2014, and AVEC responded to the comments on September 15, 2014. FERC released a draft EA and will issue their final Environmental Assessment in November 2015 and the license should be issued by the end of 2015. Environmental Permitting.AVEC sees no problems with permitting the project.No environmental (water) flows, which can sometimes hold up a project, have been proposed by any of the relevant agencies.Alaska Department of Environmental Conservation (ADEC) has issued a Water Quality Certification. A wetlands permit from the Corps of Engineers is expected by the end of 2015.ADF&G and Alaska Department of Natural Resources (ADNR) have confirmed that permits will be issued for Fish Habitat, Water Rights, and changes to the conservation easement once the FERC license has been issued by the end of 2015. (See Tab E for agency correspondence.) Geotechnical Logistics.Weather could delay the geotechnical consultants from getting into intake site to conduct site work. A drill rig will need to be transported via helicopter into the intake site. The selected consultant will be familiar with Old Harbor weather conditions and will plan the work around weather conditions as much as possible. AVEC is a cooperative and follows the International Co-operative Alliance’s Seven Principles of Cooperatives.One of the most important of those principles is titled Democratic Member Control and refers to the men and women who serve as representatives being accountable to the membership. AVEC’s member communities, especially the community involved in a grant program such as the Renewable Energy Fund (REF), have expectations for projects regarding outcomes, schedule, budget, and quality of work. AVEC member communities and Board of Directors receive regular project status updates. When problems are reported, either formally through status reports or informally through other communications, member communities expect solutions. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 20 of 35 8/11/15 5.3.2 Environmental Risk Explain whether the following environmental and land use issues apply, and if so how they will be addressed: 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 As detailed below, all environmental issues have been addressed in the environmental document of the License Application. Threatened or endangered species.The FERC designated AVEC as a non-federal representative for the purposes of conducting Endangered Species Act (ESA) consultation on August 16, 2011. Consultation letters were sent to USFWS and NOAA Fisheries on September 14, 2011. On January 20, 2011, the USFWS concurred with the finding of not likely to adversely affect ESA species and critical habitat. On February 27, 2013 NOAA Fisheries stated that in cases like this where the action agency has a finding of “no effect”,then the NOAA Fisheries concurrence is not required. There are no species under NOAA Fisheries jurisdiction in the project area. Habitat issues.The project would permanently impact approximately 15 acres and temporarily impact 61 acres of native habitat that is used by the wildlife species on Kodiak Island. Due to the limited impacts associated with the project and the abundance of undisturbed similar habitat in the vicinity of the project, impacts to terrestrial mammal habitat are considered minimal. Additional information on habitat impacts is documented in the environmental document in the license application. Wetlands and other protected areas.Most of the project components would be located within uplands to avoid wetlands. In areas where wetlands are unavoidable, project component footprints have been minimized to reduce impacts. Temporary impacts will result from construction activities occurring in wetlands, including equipment operation and the temporary storage of stockpile material. Permanent impacts will be due to the filling or dredging of wetlands to place project components. Impacts will occur in all types of wetlands mapped, with most of the permanent impacts occurring from the placement of the powerhouse and workpad. A wetlands permit application has been submitted for this project and AVEC expects a permit to be issued by the end of 2015. Archaeological and historical resources.On August 18 and 19, 2010, Northern Land Use Research, Inc., archeologists conducted a survey of the Old Harbor Hydroelectric Project area and did not document any cultural resources within the project area. FERC designated AVEC as a non-federal Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 21 of 35 8/11/15 representative for the purposes of conducting Section 106 Consultation under the National Historic Preservation Act on September 7, 2011. AVEC found that the Old Harbor Hydroelectric Project would have no effect on cultural or historic resources and sent a findings letter to the State Historic Preservation Officer (SHPO) on September 14, 2011. The SHPO concurred with this finding, stating “No Historic Properties Affected” on September 21, 2011. Land development constraints.As discussed throughout this application, an easement would be needed within the Kodiak National Wildlife Refuge, Old Harbor Native Corporation land, and City of Old Harbor land. Some land is within a conservation easement. Because AVEC continues to involve the USFWS and ADNR in project planning and because the Corporation and City are project partners, site control is not an issue. Telecommunications Interference/Aviation Considerations.Telecommunication and FAA airspace impacts are not expected with this project. AVEC has agreed to place bird diverters on the powerline between the hydro powerhouse and the community. Visual, aesthetics impacts.Because this project is outside of Old Harbor, because the penstock is below ground, and because the project is supported by the community, visual and aesthetic resources are not expected to be an issue. 5.4 Existing and Proposed Energy System Criteria:Stage 2-3.D: The proposed energy system can reliably produce and deliver energy as planned. 5.4.1 Basic Configuration of Existing Energy System Describe the basic configuration of the existing energy system. Include information about the number, size, age, efficiency, and type of generation. The power plant in Old Harbor has the following diesel generators with the total capacity of 707 kW. (1)Caterpillar 3306DI, 29 years old, rated at 235 kW (1) Caterpillar 3306DI, 10 years old, rated at 235 kW (1) Detroit Diesel Series, 10 years old, rated at 236 kW In 2014, the aggregate generator efficiency was approximately 13.98 kWh/gal (AVEC 2014 generation report). The transmission and distribution system consists primarily of overhead lines operating at 7,200 volts. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 22 of 35 8/11/15 1 The Railbelt grid connects all customers of Chugach Electric Association, Homer Electric Association, Golden Valley Electric Association, the City of Seward Electric Department, Matanuska Electric Association and Anchorage Municipal Light and Power. Existing Energy Generation and Usage a)Basic configuration (if system is part of the Railbelt1 grid, leave this section blank) i.Number of generators/boilers/other 3 ii.Rated capacity of generators/boilers/other (kW rating) 235, 235, 236 iii.Generator/boilers/other type CAT 3306DI, CAT 3306DI,DDS60K4 1200 iv.Age of generators/boilers/other 29 years, 10 years, 10 years v.Efficiency of generators/boilers/other 13.98 kWh/gallon (2014 generation report) vi. Is there operational heat recovery? (Y/N) If yes estimated annual displaced heating fuel (gallons) No b)Annual O&M cost (if system is part of the Railbelt grid, leave this section blank) i.Annual O&M cost for labor $160,000 (AVEC’s estimate for each AVEC-owned generation system) ii.Annual O&M cost for non-labor c)Annual electricity production and fuel usage (fill in as applicable) (if system is part of the Railbelt grid, leave this section blank) i.Electricity [kWh]852,852 (gross;AVEC 2014 generation report) ii.Fuel usage Diesel [gal]61,017 gallons (AVEC 2014 generation report) Other iii.Peak Load 171 kW (April;AVEC 2014 generation report) iv.Average Load 97 kW (Annual average;AVEC 2014 generation report) v.Minimum Load 89 kW (Average minimum,May;AVEC 2014 generation report) vi.Efficiency 13.98 kWh/gallon (AVEC 2014 generation report) vii.Future trends 2% annual electric demand growth rate, other benefits based on electric (fuel only) utilization of all excess energy available from hydro d)Annual heating fuel usage (fill in as applicable) i.Diesel [gal or MMBtu]62,500 gallon/year (School; estimated) ii.Electricity [kWh] iii.Propane [gal or MMBtu] iv.Coal [tons or MMBtu] v.Wood [cords, green tons, dry tons] vi.Other Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 23 of 35 8/11/15 5.4.2 Future Trends Describe the anticipated energy demand in the community over the life of the project. Old Harbor is a growing community, and anticipates future growth and development after the completion of this hydroelectric project. The Old Harbor Native Corporation has stated that they will build and operate a fish processing plant once the hydroelectric project is constructed. Operation of this project will create the power necessary to operate the plant.Being able to process fish locally will provide jobs and increase the amount of fishing revenue that stays in Old Harbor.This in turn will lead to increased resident retention for the present and greater population expansion and energy demand in the future. 5.4.3 Impact on Rates Briefly explain what if any effect your project will have on electrical rates in the proposed benefit area over the life of the project.For PCE eligible communities,please describe the expected impact would be for both pre and post PCE. Old Harbor is a PCE eligible community. In 2013, Old Harbor consumers received $207,993 in PCE credits for eligible kWh sales to residences and community facilities. Power sales that are eligible for PCE will see 5% of the benefit of reduced electric costs in their electric rates, with the other 95% accruing to the State of Alaska through reduced PCE credits to end users. Electric customers not eligible for PCE (about 57% of sales in Old Harbor) will receive the entire benefit of reduced power costs through their electric rates. 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 Optimum installed capacity Anticipated capacity factor Anticipated annual generation Anticipated barriers Integration plan Delivery methods Renewable Energy Technology.The Old Harbor Hydroelectric Project is a basin diversion project. The project will initially collect 5.9 cfs and in the future collect up to 11.8 cfs of water year round from a tributary (East Fork Mountain Creek) of Barling Bay Creek and transport it across a basin boundary to Lagoon Creek Tributary just west of the City of Old Harbor. An intake structure will divert water to a pipeline. The pipeline will consist of high-density polyethylene (HDPE) pipe in the upper section. Steel pipe will be used in the lower section, to handle the higher pressures. The majority of the pipeline will have a diameter of 18 inches.The water will run through a turbine in the powerhouse and out through a tailrace and into an existing pond (locally known as Swimming Pond). From Swimming Pond, the water will run through an enhanced channel to Lagoon Creek Tributary. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 24 of 35 8/11/15 The Old Harbor Hydroelectric Project will have an initial dependable capacity of 140 kW and a peak capacity of 296 kW. The project will be constructed initially with one turbine at 50%installed capacity until demand warrants an additional turbine. The proposed project will reduce fuel used for power generation by at least 95%. The project will be operated automatically and primarily in standalone mode as the community’s primary source of electrical generation. The table below includes the general characteristics of the project. Additional project details are found in the Reconnaissance and Feasibility Study, which has been provided to AEA in the past and is available upon request. Old Harbor Hydroelectric Project Summary General Data Initial Installed Capacity 262 kW (1 turbine) Initial Project Peak Capacity 296 kW, utilizing 5.9 cfs (1 turbine) Estimated dependable capacity 140 kW (winter/spring) Intake diversion/cut off weir/wall 4-6 ft high, 100 ft wide Penstock 10,150 ft long, 16-20 in diameter Intake Access Trail 11,500 ft long, 10 ft nominal width Powerhouse 30 ft by 35 ft Number of Generating Units (initial installed)1 Type of Turbine 262 kW Pelton/impulse Tailrace to Swimming Pond and Lagoon Creek 2,300 ft long, 3-5 ft deep, 8 ft wide Tributary Powerhouse Access Road 5,720 ft long, 24 ft wide Overhead Power Line 6,550 ft long Anticipated capacity factor.The design annual capacity factor will be 88%. Anticipated annual generation.Estimated initial average annual generation for electricity and heat will be 2,300,000 kWh (based on installation of 1 turbine). The future estimated average annual generation will be 3,520,000 kWh (based on installation of 2 turbines). Basic integration concept.Once completed, this project will easily integrate into the diesel generation system. The hydroelectric project, with its output generally exceeding all needs, will be the prime generation asset and will be controlled by an electronic governing system allowing for rapid changes in the output. Delivery Method.A 6,550-foot long (1.5 mile), 7.2 kV three-phase overhead power line will extend from the powerhouse to the existing power distribution system in Old Harbor. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 25 of 35 8/11/15 Proposed System Design Capacity and Fuel Usage (Include any projections for continued use of non-renewable fuels) a)Proposed renewable capacity (Wind, Hydro, Biomass, other) [kW or MMBtu/hr] 296 kW (initial peak output); 525 kW (future) b)Proposed annual electricity or heat production (fill in as applicable) i.Electricity [kWh]2,300,000 kWh (initial-for electricity and heat); 3,520,000 (future) ii.Heat [MMBtu] c)Proposed annual fuel usage (fill in as applicable) i.Propane [gal or MMBtu] ii.Coal [tons or MMBtu] iii.Wood or pellets [cords, green tons,dry tons] iv.Other d) i. Estimate number of hours renewable will allow powerhouse to turn diesel engines off (fill in as applicable) 5.4.5 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. Because this project involves geotechnical work and design only, no meter would be installed. AVEC installs meters on all renewable projects (primarily wind farm turbines) and will put a meter on the Pelton turbine installed for this hydroelectric project.Metering equipment specifications and costs would be determined during this phase. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 26 of 35 8/11/15 SECTION 6 –ECONOMIC FEASIBILITY AND BENEFITS 6.1 Economic Feasibility Criteria:Stage 2-4.A: The project is shown to be economically feasible (net positive savings in fuel, operation and maintenance, and capital costs over the life of the proposed project). 6.1.1 Economic Benefit Explain the economic benefits of your project. Include direct cost savings, and how the people of Alaska will benefit from the project.The benefits information should include the following: Anticipated annual and lifetime fuel displacement (gallons and dollars) Anticipated annual and lifetime revenue (based on i.e. a Proposed Power Purchase Agreement price, RCA tariff, or cost based rate) 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) The economic model used by AEA is available at http://www.akenergyauthority.org/Programs/Renewable-Energy-Fund/Rounds#round9. 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 benefit of this project will be to complete a geotechnical study and design including the final design for a hydroelectric project in Old Harbor. Once this work is completed, AVEC will seek and acquire funding for construction of the “shovel-ready” project. Anticipated annual and lifetime fuel displacement. The project will displace an estimated 95% of the fuel now consumed for power generation. At ISER’s projected fuel costs, the project will result in savings of about $369,000 during its first year of operation (2019). Over the life of the project, 50 years, this savings has a present value of $12,666,457 million using ISER’s model. In addition, the project will displace fuel used to heat. Up to 8,370 gallons of heating fuel would be saved with hydro to heat system install at the Old Harbor School.Based on ISER’s 2014 model developed of the REF application, the project would save $52,524 during its first year of operation (2019). Over the life of the project, 50 years, this savings has a present value of $3.4 million using ISER’s model.The Kodiak Island School District has provided a letter of interest in the hydro to heat system (Tab B). Anticipated annual revenue/Potential additional annual incentives/Potential additional annual revenue streams. Tax credits are not expected to be beneficial to the project due to AVEC’s status as a non-profit entity. Nonetheless, in addition to saving the direct cost of fuel,AVEC could sell green tags from the project. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 27 of 35 8/11/15 6.1.2 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 Proposed rate of return from grant-funded project 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. AVEC, the existing electric utility serving Old Harbor, is a member-owned cooperative electric utility and typically owns and maintains the generation, fuel storage, and distribution facilities in the villages it serves. No power purchase or sale agreements will be needed for this project. Identification of potential power buyer(s)/customer(s).Energy produced from the completed hydroelectric project will be sold to AVEC’s existing customer base in the community of Old Harbor. Potential power purchase/sales price/Proposed rate of return from grant-funded project.The sales price for electricity will be determined by the Regulatory Commission of Alaska as is done in all AVEC villages. The delivered cost of energy will be reduced as much as possible for customers within Old Harbor under current regulations. Energy cost reductions are expected when this project is constructed. 6.1.3 Public Benefit for Projects with Private Sector Sales For projects that include 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. Old Harbor does expect that once this project is constructed that at least one fish processing plant will move into the community; however, this is not large scale private sector as described above. By reducing the cost of power production, small businesses and public facilities in Old Harbor, including lodges, a small fish processing facility, the boat harbor, and the city, tribe, and corporation office buildings (not eligible for PCE) will see a cost savings which may be passed along to residents in the form of lower product or services prices. Renewable energy resource availability (kWh per month)N/A Estimated sales (kWh)N/A Revenue for displacing diesel generation for use at private sector businesses ($)N/A Estimated sales (kWh)N/A Revenue for displacing diesel generation for use by the Alaskan public ($)N/A Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 28 of 35 8/11/15 6.2 Financing Plan Criteria:Stage 2-4.B: The project has an adequate financing plan for completion of the grant - funded phase and has considered options for financing subsequent phases of the project. 6.2.1 Additional Funds Identify the source and amount of all additional funds needed to complete the work in the phase(s) for which REF funding is being applied in this application. Indicate whether these 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. Identification of other funding sources.AVEC expects the geotechnical study and final design phase of the project would cost $1,150,000, with $1,092,500 being requested from AEA’s Renewable Energy Fund program. It is possible that additional funding for this phase could come from the USDA Rural Utility Service Program or another grant program, supplemented by AVEC matching funds. 6.2.2 Financing opportunities/limitations If the proposed project includes final design or construction phases, what are your opportunities and/or limitations to fund this project with a loan, bonds, or other financing options? It is important to note that all loan and bonding financing options, even those with small interest rates, will necessarily increase the customers’ cost of electricity and/or heat.Since its members already pay some of the highest electric rates in the nation,AVEC therefore endeavors to complete project funding packages with grant funds. AVEC managers will explore State funding programs (such as, the Renewable Energy Fund and Community Development Block Grants) and, increasingly more important, federal grants such as the USDA’s Rural Utility Service, the Tribal Clean Energy Program (with a tribal partner), and the Indian Community Development Block Grant. However, AVEC is not adverse to pursuing loans or bonds. AVEC now has an approximate total debt of $65 Million but is not close to its mandated debt ceiling. The Board of Directors may be inclined to approve loan applications particularly if the loan would complete an otherwise nearly complete construction project budget. 6.2.3 Cost Overruns Describe the plan to cover potential cost increases or shortfalls in funding. AVEC managers and engineers working on projects use their wide experience and knowledge gained from feasibility studies, solid geo-technical information, and design processes to avoid cost increases. Cost estimates are taken very seriously and are developed carefully, and when necessary, err on the heavy side. However, cost overruns do happen –particularly in rural Alaska where extreme weather or out-of-AVEC’s-control logistics can increase the best cost estimate. As AVEC has done in the past, it will cover any cost increase or shortfall in funding necessary to complete a started project. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 29 of 35 8/11/15 6.2.4 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. AVEC anticipates requesting funds for construction in the next round of the Renewable Energy Fund with a match of 10% from its own funds. Likelihood of receipt of those funds is unknown. If unsuccessful in the competition for REF funds, AVEC will pursue other grant funding that would support the construction phase. Recognizing the trend AEA has established and references in the REF Round IX guidance for encouraging other-than-REF funds for construction phase projects, AVEC will research and apply for federal grants or grant/loan funds for the construction phase of this project.If unsuccessful in pursuing grant funds, AVEC would look to loan programs for the construction of the Old Harbor Hydroelectric Project. 6.3 Other Public Benefit Criteria:Stage 3-4.C: Other benefits to the Alaska public are demonstrated. Avoided costs alone will not be presumed to be in the best interest of the public. 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 cons idered 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 Non-economic public benefits Information/Data Benefits.Funding acquired through this grant will be used to obtain geotechnical information within Kodiak National Wildlife Refuge and conservation areas. Collection of field information will benefit the USFWS and add to the overall knowledge of the Kodiak National Wildlife Refuge. In addition, the collection of information will meet the USFWS Goal 1 of the Kodiak National Wildlife Refuge Conservation Plan͎ -Increase knowledge of fish and wildlife populations, their habitats, and their interrelationships. Subsistence Benefits.Another goal of the USFWS Conservation Plan is to “Provide the opportunity for local residents to continue their subsistence uses on the Refuge, consistent with the subsistence priority and with other Refuge purposes.” A new road will be established to the powerhouse and a new trail will be established to the intake, providing easier access to the Kodiak Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 30 of 35 8/11/15 National Wildlife Refuge. (At USFWS’s request, the trail to the intake will be open to foot traffic but closed to public ATV traffic.) Recreational and Environmental Benefits. The project will improve habitat along the dilapidated ATV trail to Swimming Pond. This existing ATV trail is heavily rutted, braids across wetlands, and has two in-stream crossings of Lagoon Creek. The project will improve habitat along the existing ATV trail to Swimming Pond as traffic will flow to the new powerhouse access road, which provides access to Swimming Pond. The new road will be in better condition, and easier to use, than the existing trail. The good condition of the powerhouse access road will encourage users to stay on the road. Allowing ATV traffic to utilize the new access road to the powerhouse will eliminate the in-stream crossings and prevent further braiding of the trail that is damaging to wetland complexes associated with the Lagoon Creek drainage. Socioeconomic Benefits.The Old Harbor Hydroelectric Project will provide multiple benefits to the socio-economic environment of Old Harbor by employing local residents and providing affordable power to local consumers and industrial users. In the short-term, the project will have a positive economic impact due to the availability of jobs during the construction of the project, including construction and bear-guard positions. There will be additional economic opportunities such as ATV and lodging rentals and the purchase of local goods by construction workers. In the long-term the project will improve socioeconomic opportunities by providing power that is stably priced. Stabilized power costs will allow for improved operation of existing public services. For example, existing facilities could be open for longer, and facilities that do not currently have power, like the boat harbor and the airport, could be connected to the grid. New business could be established. For example, the Old Harbor Native Corporation has stated that they will build and operate a fish processing plant once the hydroelectric project is constructed. Operation of this project will create the power necessary to operate the plant. Being able to process fish locally will provide jobs and increase the amount of fishing revenue that stays in Old Harbor. Community Goals Realized. The Old Harbor Hydroelectric Project will meet the goals of existing community comprehensive plans. The Kodiak Island Borough Comprehensive Plan Update lists the need for hydroelectric power as one of four priority issues facing Old Harbor.Developing a hydroelectric facility is one of the policies under Old Harbor’s Public Facilities,Health, and Safety goal. The City of Old Harbor Community Plan (City of Old Harbor, 2006) also lists hydroelectric power as a community priority. This project will stabilize energy cost and allow the City of Old Harbor, the Native Village of Old Harbor, and the Old Harbor Village Corporation to afford important community infrastructure projects listed in the plans, including a new ferry dock and a new community multipurpose building. Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 31 of 35 8/11/15 SECTION 7 –SUSTAINABILITY Describe your plan for operating the completed project so that it will be sustainable throughout its economic life. Include at a minimum: Capability of the Applicant to demonstrate the capacity, both administratively and financially, to provide for the long-term operation and maintenance of the proposed project Is the Applicant current on all loans and required reporting to state and federal agencies? Likelihood of the resource being available over the life of the project Likelihood of a sufficient market for energy produced over the life of the project AVEC has the capacity and experience to administer this grant and manage this project, if funded. As a local utility that has been in operation since 1968, AVEC is completely able to finance, operate, and maintain this project for its design life. AVEC has operated other renewable projects throughout the state and is very familiar with planning, constructing, operating, and maintaining alternative systems.AVEC is current on all loans and in 2014 successfully met reporting requirements for 22 state and 27 federal grants. Commitment to reporting the savings and benefits: AVEC is fully committed to sharing the savings and benefits accrued from this project information with its member communities and to sharing information regarding savings and benefits with AEA. Likelihood of resource being available over the life of the project:Previous studies, including information provided in the FERC application, have proven that this hydrologic resource will be available through the life of this project. Sufficient market for energy over the life of the project:We expect that the market will increase over the life of this project. The community has plans in place for development based upon lower energy costs that will be provided by this project. SECTION 8 –PROJECT READINESS Describe what you have done to prepare for this award and how quickly you intend to proceed with work once your grant is approved. Specifically address your progress towards or readiness to begin, at a minimum, the following: The phase(s) that must be completed prior to beginning the phase(s) proposed in this application The phase(s) proposed in this application Obtaining all necessary permits Securing land access and use for the project Procuring all necessary equipment and materials With $225,000 of grant funding awarded from the legislature through the first round of the Renewable Energy Fund Program and $25,000 AVEC match, AVEC initiated the FERC hydroelectric licensing process. A Preliminary Application Document and Study Plan were prepared and wetland, fisheries, cultural resources, and eagle nest field work was conducted. A draft and final study Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 32 of 35 8/11/15 report were prepared. In addition reconnaissance and feasibility study, including a hydrology study, was prepared. Regulatory agencies and FERC were involved throughout the process. AVEC was awarded $237,500 from the legislature during the fourth round of the Renewable Energy Fund Program. These funds, along with a $12,500 AVEC match, were used to complete a geotechnical assessment of the powerhouse site and powerhouse access road and powerline alignment areas. The funds were also used to prepare the DLA’s Exhibit G (Survey Maps) and the first drafts of the DLA’s Exhibit A (Project Description) and Exhibit F (Design Drawings). Funds from this grant have been exhausted. The City of Old Harbor received a $250,000 Community Development Block Grant (CDBG) to assist AVEC with completing the FERC License Application. Funds acquired through this grant along with a $12,500 AVEC match were used to complete the DLA including the Exhibit E (Environmental Report) and the final draft of the Exhibit F (Design Drawings). Funds were also used to address agency comments on the DLA, to prepare the Final License Application, and to prepare permit applications. Timing for a REF Round 9 grant award and completion of the work funded under previous grants is perfect.All environmental permits would be issued prior to or with the FERC License by the end of 2015. FERC license and permit requirements would be seamlessly incorporated into the final design and construction starting in January 2017. 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. The Documentation of support must be dated within one year of the RFA date of July 8,2015. The community of Old Harbor supports and is interested in moving forward with this important project. Letters of support have been received by all governing entities. In addition, the Kodiak School District has submitted a letter of interest for a hydro to heat system installation at the Old Harbor School. Please see Tab B. SECTION 10 –COMPLIANCE WITH OTHER AWARDS Identify other grants that may have been previously awarded to the Applicant by the Authority 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. AVEC’s record in grant administration and project management is excellent.Grant and project managers (in particular, Steve Gilbert and Forest Button) and the financial staff (in particular, Alden Worachek) complete all reporting and information requests in a timely manner.AVEC’s performance of REF grants’ milestone timelines may not have always hit within the bull’s eye but certainly don’t miss the target altogether.In addition to many successful REF grants, AVEC’s grant history shows successful Rural Utility Service High Energy Cost Grants, Alaska Community Renewable Energy Fund Round IX Grant Application -Standard Form OLD HARBOR HYDROELECTRIC PROJECT AEA 15003 Page 33 of 35 8/11/15 Development Block Grants, Norton Sound Economic Development Grants, and Alaska Legislative Grants. AVEC has systems in place to accomplish reporting requirements successfully.In 2014, AVEC successfully met reporting requirements for 22 state and 27 federal grants.An independent auditor’s report on compliance with aspects of contractual agreements and regulatory requirements, independent auditor’s report on internal control over financial reporting and on compliance and other matters, and an independent auditor’s report on compliance for each major federal program and report on internal control over compliance required by OMB Circular A-133 for AVEC for 2014 did not identify any deficiencies in internal control over compliance that they considered to be material weakness. In addition, the independent auditor’s report on compliance with aspects of contractual agreements and regulatory requirements stated that nothing indicated AVEC failed to comply with the terms, covenants, provisions, or conditions of loan, grants, and security instruments as specified in 7 CFR part 1773. SECTION 11 –LIST OF SUPPORTING DOCUMENTATION FOR PRIOR PHASES In the space below please provide a list additional documents attached to support completion of prior phases. The Federal Energy Regulatory Commission’s e-Library has most of the information needed.It has all the pertinent documents, including the preliminary design are found by searching Old Harbor Hydroelectric Project docket number P-13272 at this site:http://www.ferc.gov/docs- filing/elibrary.asp In addition, please see the following documents under Tab E: ADF&G Division of Habitat Email Re: Fish Habitat Permit Issuance ADNR Division of Mining, Land & Water, Water Resources Section Letter Re: Water Rights Issuance ADEC Division of Water Letter Re: Certificate of Reasonable Assurance (Water Quality Cert) Issuance ADNR Division of Mining, Land & Water, Reality Services Section Letter Re: Conservation Easement Amendment Issuance SECTION 12 –LIST OF ADDITIONAL DOCUMENTATION SUBMITTED FOR CONSIDERATION In the space below please provide a list of additional information submitted for consideration. An analysis of the benefits of a dispatchable heating system at the school is included under Tab E. Tab A Resumes Tab A is provided as a separate file to this document. Tab B Letters of Support September 14, 2015 Alaska Energy Authority 813 West Northern Lights Boulevard Anchorage, Alaska 99503 Regarding: AEA Renewable Energy Fund – Round IX Old Harbor Hydroelectric Project To Whom it May Concern: The Community of Old Harbor is located on the southeast coast of Kodiak Island and the economy is based on commercial fishing and is supplemented by ecotourism. The City of Old Harbor, Alutiiq Tribe of Old Harbor and Old Harbor Native Corporation all work together to improve the overall health of our community. The City of Old Harbor, Old Harbor Tribal Council and Old Harbor Native Corporation are very pleased and excited for the final FERC permit for the Old Harbor Hydroelectric Project to be issued in October 2015. AVEC and our community organizations have been collaborating on this project for many years and our community is completely in support of the hydroelectric project. Old Harbor relies exclusively on diesel fuel for our electrical and heating needs. AVEC provides power to the community with diesel generators, and residents buy heating fuel to warm their homes. This project is critically needed to decrease diesel consumption, reduce energy costs and allow for an improved economy. The hydroelectric electric facility will be primarily for residential needs and l ighting. We have been working on a commercial fish processing plant development which will increase the population and residential use, KRAA hatchery production which will increase energy consumption, and increased lighting needs for associated support businesses. The Community has been working together on developing additional housing (i.e. subdivision) which will add additional energy needs. Recently, KIHA has had a lot rezoned for multi-residential in order to build a duplex. The residential and commercial use of water will increase as the community population grows and the economic development progresses. The water service is provided by pumping all fresh water through the treatment facility to the community which is one of the large consumers of electric energy at this time and with increased use will require additional energy. The Current harbor facility is in need of lighting and the City is working on a plan to install these lights. The Kodiak Regional Aquaculture Association, in collaboration with the community, is working on a remote release salmon project just south of the community in Three Saints Bay. As this project develops, the community is working with KRAA to develop a plan for a local fish hatchery to provide the fry for this project and enhancement concepts into the future. This project will also require additional energy needs to operate. The community leaders are developing the infrastructure within Old Harbor to support the main economic driver of fish processing and related industries. Fish processing will include the need for energy to provide for increased population, general lighting of the fish processing area, and other domestic use. We understand that some aspects of processing require instant load pickup and will be supported by diesel generation but the passive loads that are continually used can be integrated into the hydroelectric system. By following our community plan and visions for the future we are striving to become more self-sufficient and economically viable by utilizing renewable energy resources and developing our economic opportunities in our geographic area. The improved local economic opportunities will put people to work in the community and decrease the rural-urban migration occurring in our community and many other locations throughout Alaska. Locally produced, affordable energy will empower community residents and avert the rural to urban migration and as a result sustain our village. Alaska Village Electric Cooperative (AVEC) is proposing to complete the final design and geotechnical work for a hydropower project in Old Harbor. The work would include preparing the final design, obtaining permits and completing the geotechnical work. We respectfully request your support for this project. This project would dramatically improve the long-term self-sufficiency and viability of the community by producing affordable electricity. We appreciate your consideration of the Old Harbor hydroelectric facility as this is an imperative project that will sustain our community and initiate economic opportunities for our residents. If you have any questions or require further information, please do not hesitate to contact Cynthia Berns at 907.257.1823 or cberns@oldharbor.org. Quyanaa - Thank you! Best regards, CITY OF OLD HARBOR ALUTIIQ TRIBE OF OLD HARBOR OLD HARBOR NATIVE CORPORATION Rick Berns Stella Krumrey Carl Marrs City Mayor President Chief Executive Officer Cc: Old Harbor City Council Alutiiq Tribe of Old Harbor Tribal Council Old Harbor Native Corporation Board of Directors Kodiak Island Borough School District 722 Mill Bay Road Kodiak, Alaska 99615 Memo to: Cynthia R. Berns, Senior Project Executive, City of Old Harbor From: Gregg Hacker, Facilities Director Date: September 1, 2015 Subject: Old Harbor interruptible electric service agreement As the provider of a robust K-12 education program in the rural community of Old Harbor the Kodiak Island Borough School District (KIBSD) is always ready to explore options that help us control our energy cost and support the community. The following is a brief description of the community and the school as it appears on the schools website: http://oldharbor.kibsd.org/pages/Old_Harbor_School Old Harbor is a coastal, Alaskan maritime community of some 230 individuals. We are located on the Southeast Coast of Kodiak Island, 70 air miles southwest of the City of Kodiak. We are a community that relies on the natural resources of our surrounding sea and upland environment for our livelihood. The sea also provides us with our main means of transportation and access. It is important to note that Old Harbor can only be reached by marine or air transportation. There are no roads leading to Old Harbor. There are approximately 76 separate households in Old Harbor. Economically the town is based around three themes - fishing industry, tourism, and services to the community. Fishing families harvest salmon, cod, crab, halibut and sell to companies outside the community. Tourism provides employment through two lodges, two bed and breakfast establishments, and several hunting and fishing outfitters. Most families are connected to the culture and live a subsistence lifestyle. Community services are mentioned above. Old Harbor School serves students in grades K - 12. We have 5 regular Education teachers, one special education teacher, one counselor, three paraprofessionals, a secretary/cook, a day man/custodian, custodian and a principal. We are the Old Harbor Lynx, and offer mixed volleyball, basketball, and a Christmas play. The community also offers wrestling to our students. In addition to the above extra- curricular activities, we participate in the spelling bee, and the Kodiak College and Career Fair, and have a strong Battle of the Books team. Last years fuel cost for the Old Harbor School and Gym was $35,259 for 7194 gallons. The School District is most definitely interested in exploring an interruptible electric service sales agreement and I look forward to reviewing the AVEC draft proposal. If the project team needs drawings or information about our systems at the school please give me a call at 907-481-2285. Tab C Heat Project Information No information provided in this section. Not applicable to this project. Tab D Authority 2001.1 ALASKA VILLAGE ELECTRIC COOPERATIVE, INC. Delegations of Authority from the Board of Directors to the President & CEO I. OBJECTIVE To define the delegations of authority and responsibilities from the Board of Directors to the President and Chief Executive Officer to enable him/her to adequately direct the operations of Alaska Village Electric Cooperative, Inc. and to report to the Board on the results achieved. II. POLICY A. Planning 1. Policies To formulate, with the staff as appropriate, the policies of Alaska Village Electric Cooperative to be recommended by the President and Chief Executive officer to the Board of Directors for their consideration. Such policies shall be reviewed by the President and Chief Executive Officer at least once a year and a recommendation made to the Board on any revisions required. 2. To develop, with the staff, the viewpoints, objectives and goals of Alaska Village Electric Cooperative and to review periodically these objectives and goals, as well as the results achieved, with the Board. 3. Long and Short-Range Plans To conduct studies with the staff and outside consultants, if necessary, and recommend to the Board short and long-range plans, including plans in such areas as system studies, engineering work plans, power requirements and load forecasts, financial forecasts, energy management, member and public relations, construction, facilities, etc., and to report to the Board on results compared to such plans. 4. Membership Meetings To develop, with the staff, plans for annual and other meetings of Alaska Village Electric Cooperative, and to make appropriate recommendations to the Board. 5. Work Plans and Budgets To formulate, with the staff, annual work plans and budgets for Alaska Village Electric Cooperative and recommend them to the Board for their consideration, and to provide detailed quarterly reports on revenue, expenses and other results compared to such plans. 6. Legislation To analyze and determine, with the Board and with the staff and in coordination with organizations such as Alaska Rural Electric Cooperative Association (ARECA) and the National Rural Electric Cooperative Association (NRECA), state and federal legislative and regulatory matters to be proposed, supported or opposed consistent with Cooperative goals and philosophy. B. Organization 1. Organization Structure a. To periodically review activities of Alaska Village Electric Cooperative and to determine with the staff as appropriate, the organization structure best suited to carry out the overall objectives of Alaska Village Electric Cooperative within the limitations of the budget. 2001.2 b. To determine, with the appropriate staff members, the need for additional positions, the transfer, reassignment, or elimination of present positions, and to effect such changes, provided they are within the limitations of the personnel costs of the approved budget. 2. Selection of Personnel a. To develop or approve standards and qualifications for use in recruitment, transfer, and promotion of personnel. Such standards and qualifications should meet all federal and state legal requirements. b. To select, appoint, transfer, promote, demote, discipline and terminate personnel. 3. Training a. To ensure that the staff members are trained in accordance with the qualifications and requirements of their positions. b. To initiate and promote, through appropriate staff, training programs for all personnel within the limitations of the approved budget, including sending personnel to training programs outside the organization. 4. Performance Appraisals a. To appraise, at least annually, the performance of immediate staff members and to counsel with them and assist them to develop and improve. b. To ensure that a performance appraisal program is established and carried out for all personnel and that adjustments for those outside the bargaining unit are based on merit. 5. Position Descriptions To ensure that written position descriptions and job specifications are prepared and reviewed as necessary for all personnel. 6. Fringe Benefits To administer or approve activities and actions with respect to annual leave, holidays, and other fringe benefit programs for the personnel within established policies and within the limitations of the budget. A report shall be presented annually to the Board or committee of the Board describing the various benefits and employee and employer contribution, if any, and what percent fringes are of payroll. 7. Consultants a. To recommend to the Board the employment of general counsel and independent auditors, and contracts and agreements for their services with the committee making an appropriate recommendation to the Board. b. To select and appoint other outside specialized consultants, and to negotiate contracts or agreements for services of such specialized consultants, within the limitations of the work plan and budget, and to advise the Board of actions taken. c. To report to the Board periodically on services provided and the fees received by principal consultants. 8. Wage and Salary Administration a. To develop wage and salary policy and present it to the Board for approval. 2001.3 b. To determine all salaries, except the President and Chief Executive officer's, within the Board approved wage and salary policy and within the limitations of the budget. A report is to be provided to the Board annually regarding the administration of the wage and salary policy. 9. Labor Relations a. To negotiate, with or without consulting assistance, labor contracts and make appropriate recommendations to the Board. b. To administer the approved labor contract and see that the appropriate supervisors understand the provisions of the contract and its administration. C. Operations 1. Overall Administration a. To direct the day-to-day operations and activities of Alaska Village Electric Cooperative except as specified otherwise by the By-Laws or the Board; to delegate authority to immediate staff; to authorize further delegation of authority to any level of management with full recognition that the President and Chief Executive Officer cannot be relieved of overall responsibility or accountability. b. To manage operations of Alaska Village Electric Cooperative in accordance with the policies of the Board and in accordance with policies and procedures of RUS and other lending institutions; as well as applicable federal, state, and local laws. c. To designate an appropriate person to serve as Acting President and Chief Executive Officer in an extended absence of the President and Chief Executive Officer. In case the President and Chief Executive Officer becomes incapacitated, the Assistant President and Chief Executive Officer shall serve temporarily as Acting President and Chief Executive Officer until the Board of Directors takes appropriate action, at a meeting to be convened as soon as possible. d. To ensure that staff advice and assistance is provided to the Board and its committees, and to participate in the deliberation of these committees as requested or required. e. To accept invitations to participate in or designate other staff members to participate in national, regional, state, and local meetings which further the best interests of Alaska Village Electric Cooperative, within the limitations of Board policy and the approved budget. Participation by the President and Chief Executive Officer in such activities that require considerable time over a sustained period requires the approval of the Board. The President and Chief Executive Officer's serving on the board of other organizations shall be reported to the Board. f. To serve as the authorized spokesperson for Alaska Village Electric Cooperative on matters and to keep the Board up-to-date and well informed on such matters. g. The President and Chief Executive Officer shall take all necessary steps in the event that the Cooperative is served with legal process to protect all interests of the Cooperative with respect to such litigation and such matters shall be brought to the attention of the Board at the next scheduled meeting. 2. Membership Services To direct membership services in such areas as, but not necessarily confined to, public and member relations, load management, energy conservation, communications, and research as authorized by the Board. 3. Legislation a. To develop and carry out, in coordination with organizations such as ARECA and NRECA, and within expressed Board philosophy, a legislative program furthering Alaska Village Electric Cooperative's objectives and policies. Such a program will include, but not be limited to, research, 2001.4 preparation, and presentation of testimony before appropriate committees, consultation with members of Congress, the State Legislature, and state and federal administrative and regulatory agencies. b. To participate with allied groups to obtain their increased understanding and support of Alaska Village Electric Cooperative's legislative and regulatory objectives and programs. 4. Financial a. To make expenditures in accordance with the approved budget, including approval of non- budget items up to $100,000 or all non-budgeted items which, in his judgment, are vital to effect unanticipated emergency maintenance or repairs. Non-budgeted items exceeding $100,000 which are not items vital to effect unanticipated emergency maintenance or repairs, must be presented to the Board for approval. b. To invest or reinvest funds, cash investments when due, and cash government bonds, when and if necessary to protect Alaska Village Electric Cooperative's cash position and to carry out an effective cash management program. Investments will generally be made in CFC securities, in federal government insured or guaranteed securities or in other securities approved by the lending agencies. c. To authorize and approve the travel expenses of personnel except the President and Chief Executive officer's on company business within the limitations of the budget and within established policy. Such expenses shall be supported by itemized expense accounts with receipts attached, as appropriate. Expenses of the President and Chief Executive Officer will be reviewed by the Secretary/Treasurer. d. To approve account systems, procedures, statistics, and types of reports necessary for sound financial management and to meet the requirements of lending and regulatory agencies and for necessary control information required by the Board. e. To purchase or lease all equipment, vehicles, hardware, furniture, materials, and supplies within the guidelines of the budget. All purchases shall comply with RUS policies or procedures. f. To negotiate contracts for construction in accordance with RUS procedures. The contracts will be awarded in accordance with RUS procedures so construction completed can be reimbursed from loan funds without delay. g. To execute and deliver purchase orders or contracts for projects previously approved by the Board. h. To approve and sign changes under contracts previously approved by the Board and RUS if under $50,000. Those changes in excess of $50,000 are to be reported to the Board at the next Board meeting and all changes are to be approved by RUS if appropriate. i. To authorize individual memberships in civic clubs and organizations in which he/she thinks of him/herself or staff members would be beneficial and to authorize payment of dues by Alaska Village Electric Cooperative within the limitations of the budget. Professional registration fees will only be paid for registration in the State of Alaska, if such registration is desirable or required. j. To execute and delivery on behalf of Alaska Village Electric Cooperative agreements essential to the management of the Cooperative, such as affidavits, agreements, and leases to implement Board actions. k. To negotiate franchises and execute all petitions and documents in relation thereto; to acquire by purchase or lease all easements and power plant sites and execute, deliver and accept all documents relating thereto; to execute and deliver all environmental studies and reports; to make application for all permits relating to the operations of Alaska Village Electric Cooperative's design, route, and determine the site for all facilities. 2001.5 l. To perform all acts necessary or incidental to the management of the operations of Alaska Village Electric Cooperative, unless such acts are specifically reserved to the Board pursuant to law, and Articles of Incorporation, the By-Laws, or policies. 5. Controls a. Operations To submit periodic and special reports to the Board on conformity of operations with approved policies and programs; to recommend any revisions requiring Board approval and to direct any remedial action required. b. Finances To submit periodic and special financial reports to the Board to keep them informed of Alaska Village Electric Cooperative's financial position and conformance to financial plans and forecasts, and to see that all persons having access to cash or responsible for purchasing of materials are properly bonded in accordance with all requirements of the lending agencies. c. Budgets To report quarterly to the Board on revenues and expenditures compared to budget. To recommend any revisions required, and to direct any necessary remedial action. d. Annual Financial Audit To participate with the Board in the review, with the auditor present,. of the annual financial audit and management letter and to direct any remedial action required and to ensure that the management letter, along with the Audit Report, is sent to each Board member prior to the meeting at which they are to be discussed. e. Materials Management 1. To determine the amount of and establish proper control of all physical inventories to minimize investment in inventories needed to meet operating and construction needs. 2. To ensure that a system is established to accurately account for all materials used. f. Member Complaints To submit periodically to the Board an analysis of member complaints and to take any corrective action required or to recommend appropriate revisions in Board policy. g. Reliability of Service To submit annually to the Board a report on service reliability and any remedial action taken. h. By-Laws To report to the Board on annual review with the General Counsel of the By-Laws and to recommend any revisions required. i. Availability of Power Supply To report periodically to the Board on load growth compared to the power requirements studies and to recommend plans to meet anticipated growth to ensure an adequate and reliable supply for the members at the lowest possible cost consistent with sound business and management practices. 2001.6 j. Rates To continually study power and other costs compared to projections and to recommend to the Board, as far in advance as possible, any changes in retail electric rates necessary to maintain financial strength and stability and to meet all requirements of lending and regulatory agencies. k. Construction To review construction practices with appropriate staff to make sure projects are being constructed in accordance with RUS policies and procedures so that reimbursement for completed construction can be obtained promptly. l. Internal Auditing To independently assess the adequacy, effectiveness and efficiency of the system of control within the organization and the quality of ongoing operations against policies and procedures established by management and/or the Board, and rules of RUS and other lending institutions; as well as applicable federal, state and local laws. IV. RESPONSIBILITY A. The President and Chief Executive Officer shall report to the Board periodically on how these delegations are being carried out. The Chairman of the Board shall be kept appraised of all major issues on a regular basis between all Board Meetings. The President and Chief Executive Officer may make further delegations to his staff as required. B. The Board is responsible for approving any changes in the delegations to the President and Chief Executive Officer. C. The Chairman shall be responsible for seeing that the performance of the President and Chief Executive Officer is appraised prior to his/her anniversary date each year by the Executive Committee of the Board and that a report is made at a subsequent meeting to the full Board, on the results of such appraisal, and that the results of such appraisal are discussed with the President and Chief Executive Officer. Date Adopted: 3-23-92 Resolution #92-18 Date Revised: 5-05-00 Resolution #00-37 Date Reviewed: 05/23/08 Resolution #08-25 Tab E Additional Materials If you disagree with any information contained herein, please advise immediately. , Rev. 3 Page 1 © Hatch 2014 All rights reserved, including all rights relating to the use of this document or its contents. Project Memo H345376 4 September 2014 To: Steven Gilbert, AVEC From: Daniel Hertrich cc: Robin Reich, Solstice Alaska Village Electric Cooperative Old Harbor Hydroelectric Project Economic Update and Heating Analysis 1. Introduction In 2013 Hatch provided a technical analysis in support of both the Alaska Village Electric Cooperative's (AVEC) Old Harbor Federal Energy Regulatory Commission (FERC) License Application and AVEC's Renewable Energy Fund (REF) grant application with the Alaska Energy Authority (AEA). The analysis results were presented in a memo. This project memo again updates the project economics in support of an application to AEA's REF. 2. Executive Summary and Value of Development Resources This memo provides a review and update of the economics for the Old Harbor Hydroelectric Project and is based on the previous economic update, presented 6 September 2013 in a Project Memo. Updates include  Estimating the economic potential for utilization of excess energy for heating purposes,  Revised fuel price projection, and  Revised demand projection. The electric generation values shown in the 2013 Value of Development Resources (section 2.1) are revised as follows: Item Value Units Annual Electric Demand (2014 projected) 915,059 kWh Electric Demand Displaced by Hydro Project 915,059 kWh Market Value of Displaced Electric Demand $335,602 $(2014) Electric Demand Growth, past 6 years 4.6% Projected Electric Demand Growth 2.0% In addition to the above, the following summarizes the combined annual electric and heating fuel used in Old Harbor and the potential displacement by the hydro. , Rev. 3 Page 2 © Hatch 2014 All rights reserved, including all rights relating to the use of this document or its contents. Table 1 - 2014 Projected Fuel Use and Cost of Avoidable Diesel Energy Electric and Heating Alternative Total Fuel Used Annually, gals Nonfuel Diesel Costs (avoidable only), $ Total Cost @ $3.88/gal Electric and $5.70/gal Heat Annual Market Value of Energy Displaced by Hydro Project Excess Hydroelectric Energy Value Diesel Only 127,861 167,000 $776,852 Hydro, No Heat 62,500 0 $441,250 $335,602 $708,165 Hydro, Dispatchable Heat 53,509 0 $390,001 $386,851 $628,546 Details of the calculation of annual energy use, costs, and economic projections for both displaced electric and heating are presented in the following sections. 3. Supporting Data 3.1 Climate data Heating degree days were calculated from monthly totals from the Kodiak WSO Airport climate station1. The table below shows the monthly summary. Table 2 - Monthly Heating Degree Days for Kodiak WSO Airport 1973 to 2013, Base Temperature = 65 F, last updated on Jun 7, 2013 Month Mean Jan 1,057 Feb 963 Mar 996 Apr 812 May 644 Jun 451 Jul 325 Aug 300 Sep 457 Oct 746 Nov 925 Dec 1,052 Ann 8,690 3.2 Heating Fuel Use Total heating fuel use reported by the City of Old Harbor is 60,000 to 65,000 gallons annually with the single largest user (school) using about 8,000 to 10,000 gallons annually2. Heat demand and subsequent fuel use is distributed throughout the year on a daily basis using the monthly heating degree data above. 3.3 Diesel Fuel price Recent delivered fuel prices for electrical generation in Old Harbor were provided by AVEC. Future fuel price projection is based on an average of the September 2013 mid price projections made by ISER and 1 http://www.wrcc.dri.edu/cgi-bin/cliMONthdd.pl?ak4988 2 Conversation with City of Old Harbor , Rev. 3 Page 3 © Hatch 2014 All rights reserved, including all rights relating to the use of this document or its contents. an updated ISER model using December 2013 USEIA crude price projections. The resulting price projections are shown in the table below. Table 3 - Near Term Fuel Price Projections, Electric Generation Year AVEC Fuel Price ISER 2013 Model Updated ISER Model Modeled Fuel Price 2013 3.95 4.03 4.44 3.95 2014 3.88 3.79 4.42 3.88 2015 3.80 4.27 4.04 2016 3.78 4.21 3.99 2017 3.84 4.14 3.99 2018 3.94 4.15 4.05 2019 4.01 4.19 4.10 2020 4.08 4.26 4.17 2021 4.15 4.34 4.24 2022 4.21 4.43 4.32 Heating fuel price is based on the current retail price quoted by the City of Old Harbor of $5.70 per gallon inflated at the same rate. 3.4 Heating Equipment Configurations and Costs The development scenario analyzed for this memorandum consists of an electric resistive hot water boiler displacing large commercial users of heating fuel in Old Harbor. Investigations established that an electric boiler could be installed in the school that would utilized interruptible electric energy to offset the existing diesel fuelled heating demand. A conversion efficiency of 100% is used for the electric boiler system. Maximum potential heating displacement by the hydro is limited by the school's annual heating fuel use of 9,000 gallons. This dispatchable system is expected to have a capital cost of approximately $250,000 installed. 3.5 Economic Analysis (term, rates, analysis) Demand growth is included because of the recent trend in growth and the significant amount of excess energy available from the hydroelectric project. The analysis includes a demand growth rate of 2.0% annually. No growth is used for heating demand. The potential displaced diesel electric generation and heating fuel use is calculated each year taking into account demand peak, a fixed power reserve or margin, and resource and hydroelectric project limitations. Similarly, the amount of excess energy available for heating usage decreases as the electrical demand increases. Economic Parameters Term 50 years Discount Rate 3.0 % 4. Results The results of the analysis show that installing equipment to offset heating loads will have a positive economic value. The table below summarizes the Net Present Cost (NPC) of meeting Old Harbor's , Rev. 3 Page 4 © Hatch 2014 All rights reserved, including all rights relating to the use of this document or its contents. electric and heating energy needs over the next 50 years (fixed generation, distribution and transmission, and administrative costs excluded). Dispatchable heating shows some improvement over no heat utilization. The B/C ratio improves from 1.59 to 1.69. Table 4 - Economic Results for Electric Generation Only Diesel Only Hydro + Diesel NPC of Generation $18,226,626 $13,023,196 NPV of Investment, Costs $0 $8,885,895 NPV of Investment, Benefits $0 $14,089,325 B/C Ratio of Investment NA 1.59 Table 5 - Economic Results for Electric + Heat Generation Diesel Only Hydro + Diesel, dispatchable heat NPC of Generation $30,517,856 $24,155,032 NPV of Investment, Costs $0 $9,192,919 NPV of Investment, Benefits $0 $15,555,743 B/C Ratio of Investment NA 1.69 Daniel Hertrich Attachment: Economic Update and Heating Analysis Result Tables, 2 pages Economic Update and Heating Analysis Result TablesAlaska Village Electric Alaska CooperativeOld Harbor Hydroelectric ProjectSUM 50YRS 77,400,000 5,530,000$33,320,000 $8,350,000 $41,670,000 99,860,000 3,125,000 $26,110,000 $67,780,000NPV 50YRS $13,929,755 $4,296,871 $18,226,626 $12,291,230 $30,517,856Diesel Heating CostTotal ExistingDiesel Electric Generation CostsYearAnnual Electric Demand, kWh (2.0% growth rate)Diesel Electric Fuel Use, galModeled Fuel Price, $2014 per galDiesel Electric Fuel Cost, $2014Diesel Electric Nonfuel Cost, $2014Total Diesel Electric Cost, $2014Heat Demand, kWhFuel Used, galHeat Fuel Cost, $2014Total Heat Cost, $2014Total Diesel Energy Cost, $20142014915 05965 361388$253 602$167 000$420 6021 997 14362 500$5 70$356 250$776 8522014915,05965,3613.88$253,602$167,000$420,6021,997,14362,500$5.70$356,250$776,8522015 933,360 66,669 4.04 $269,017 $167,000 $436,017 1,997,143 62,500$5.93 $370,494 $806,5112016 952,027 68,002 3.99 $271,641 $167,000 $438,641 1,997,143 62,500$5.87 $366,773 $805,4152017 971,068 69,362 3.99 $277,001 $167,000 $444,001 1,997,143 62,500$5.87 $366,677 $810,6782018990 48970 749405$286 252$167 000$453 2521 997 14362 500$5 94$371 493$824 7452018990,48970,7494.05$286,252$167,000$453,2521,997,14362,500$5.94$371,493$824,7452019 1,010,299 72,164 4.10 $295,897 $167,000 $462,897 1,997,14362,500 $6.02 $376,480 $839,3772020 1,030,505 73,608 4.17 $307,048 $167,000 $474,048 1,997,14362,500 $6.13 $383,007 $857,0552021 1,051,115 75,080 4.24 $318,602 $167,000 $485,602 1,997,14362,500 $6.23 $389,627 $875,2282022 1,072,137 76,581 4.32$330,774$167,000$497,774 1,997,143 62,500$6.35$396,581$894,355,,,$,$,$,,,,$$,$,2023 1,093,580 78,113 4.40 $343,414 $167,000 $510,414 1,997,14362,500 $6.46 $403,662 $914,0762024 1,115,452 79,675 4.48 $356,646 $167,000 $523,646 1,997,14362,500 $6.58 $410,996 $934,6422025 1,137,761 81,269 4.55 $370,155 $167,000 $537,155 1,997,14362,500 $6.69 $418,199 $955,3542026 1,160,516 82,894 4.63 $383,938 $167,000 $550,938 1,997,14362,500 $6.80 $425,266 $976,2042027 1,183,726 84,552 4.70 $397,765 $167,000 $564,765 1,997,14362,500 $6.91 $431,943 $996,7082028 1,207,401 86,243 4.79 $412,695 $167,000 $579,695 1,997,143 62,500 $7.03 $439,368 $1,019,0622029 1,231,549 87,968 4.86 $427,578 $167,000 $594,578 1,997,143 62,500 $7.14 $446,288 $1,040,8662030 1,256,180 89,727 4.94 $443,067 $167,000 $610,067 1,997,143 62,500 $7.25 $453,387 $1,063,45520311 281 30491 522501$458 620$167 000$625 6201 997 14362 500$7 36$460 100$1 085 72020311,281,30491,5225.01$458,620$167,000$625,6201,997,14362,500$7.36$460,100$1,085,7202032 1,306,930 93,352 5.09 $475,285 $167,000 $642,285 1,997,143 62,500 $7.48 $467,469 $1,109,7532033 1,333,068 95,219 5.18 $492,889 $167,000 $659,889 1,997,143 62,500 $7.60 $475,278 $1,135,1672034 1,359,730 97,124 5.26 $511,000 $167,000 $678,000 1,997,143 62,500 $7.73 $483,080 $1,161,08020351 386 92499 066534$528 622$167 000$695 6221 997 14362 500$7 84$489 941$1 185 56320351,386,92499,0665.34$528,622$167,000$695,6221,997,14362,500$7.84$489,941$1,185,5632036 1,414,663 101,047 5.41 $546,509 $167,000 $713,509 1,997,143 62,500 $7.95 $496,587 $1,210,0952037 1,442,956 103,068 5.48 $565,063 $167,000 $732,063 1,997,143 62,500 $8.05 $503,379 $1,235,4422038 1,471,815 105,130 5.56 $584,303 $167,000 $751,303 1,997,143 62,500 $8.16 $510,312 $1,261,61420391 501 251107 232563$604 245$167 000$771 2451 997 14362 500$8 28$517 381$1 288 62620391,501,251107,2325.63$604,245$167,000$771,2451,997,14362,500$8.28$517,381$1,288,6262040 1,531,276 109,377 5.71 $624,910 $167,000 $791,910 1,997,143 62,500 $8.39 $524,584 $1,316,4942041 1,561,902 111,564 5.79 $646,320 $167,000 $813,320 1,997,143 62,500 $8.51 $531,919 $1,345,2392042 1,593,140 113,796 5.87 $668,498 $167,000 $835,498 1,997,143 62,500 $8.63 $539,383 $1,374,8812043 1,625,003 116,072 5.96 $691,467 $167,000 $858,467 1,997,143 62,500 $8.75 $546,977 $1,405,444,,,,,,,,,,,,2044 1,657,503 118,393 6.04 $715,254 $167,000 $882,254 1,997,143 62,500 $8.88 $554,699 $1,436,9532045 1,690,653 120,761 6.13 $739,884 $167,000 $906,884 1,997,143 62,500 $9.00 $562,549 $1,469,4342046 1,724,466 123,176 6.21 $765,387 $167,000 $932,387 1,997,143 62,500 $9.13 $570,529 $1,502,9162047 1,758,955 125,640 6.30 $791,818 $167,000 $958,818 1,997,143 62,500 $9.26 $578,658 $1,537,4772048 1,794,134 128,152 6.39 $819,208 $167,000 $986,208 1,997,143 62,500 $9.39 $586,935 $1,573,1432049 1,830,017 130,715 6.48 $847,586 $167,000 $1,014,586 1,997,14362,500 $9.53 $595,361 $1,609,9472050 1,866,617 133,330 6.58 $876,989 $167,000 $1,043,989 1,997,14362,500 $9.66 $603,935 $1,647,9242051 1,903,950 135,996 6.67 $907,453 $167,000 $1,074,453 1,997,14362,500 $9.80 $612,660 $1,687,11320521 942 029138 716677$939 018$167 000$1 106 0181 997 14362 500$9 94$621 541$1 727 55920521,942,029138,7166.77$939,018$167,000$1,106,0181,997,14362,500$9.94$621,541$1,727,5592053 1,980,869 141,491 6.87 $971,726 $167,000 $1,138,726 1,997,14362,500 $10.09 $630,579 $1,769,3052054 2,020,487 144,320 6.97 $1,005,621 $167,000 $1,172,621 1,997,14362,500 $10.24 $639,778 $1,812,3992055 2,060,896 147,207 7.07 $1,040,748 $167,000 $1,207,748 1,997,14362,500 $10.39 $649,143 $1,856,89220562 102 114150 151717$1 077 155$167 000$1 244 1551 997 14362 500$10 54$658 678$1 902 83420562,102,114150,1517.17$1,077,155$167,000$1,244,1551,997,14362,500$10.54$658,678$1,902,8342057 2,144,157 153,154 7.28 $1,114,891 $167,000 $1,281,891 1,997,14362,500 $10.69 $668,385 $1,950,2762058 2,187,040 156,217 7.39 $1,154,003 $167,000 $1,321,003 1,997,14362,500 $10.85 $678,268 $1,999,2712059 2,230,780 159,341 7.50 $1,194,544 $167,000 $1,361,544 1,997,14362,500 $11.01 $688,330 $2,049,87420602,275,396162,5287.61$1,236,569$167,000$1,403,5691,997,14362,500$11.18$698,574$2,102,14320602,275,396162,5287.61$1,236,569$167,000$1,403,5691,997,14362,500$11.18$698,574$2,102,1432061 2,320,904 165,779 7.72 $1,280,133 $167,000 $1,447,133 1,997,14362,500 $11.34 $709,005 $2,156,1382062 2,367,322 169,094 7.84 $1,325,296 $167,000 $1,492,296 1,997,14362,500 $11.51 $719,626 $2,211,9222063 2,414,668 172,476 7.96 $1,372,119 $167,000 $1,539,119 1,997,14362,500 $11.69 $730,442 $2,269,5619/4/2014Page 1 of 320140904‐power‐model.xlsx Economic Update and Heating Analysis Result TablesAlaska Village Electric Alaska CooperativeOld Harbor Hydroelectric ProjectSUM 50YRSNPV 50YRS$1,100,000 $9,250,000 $10,350,000 $0 $10,350,000 $4,000,000 77,400,000 6,350,000 71,040,000 450,000 $18,540,000 $18,540,00092,060,000 6,575,853 $30,070,000$1,015,495 $7,870,400$8,885,895 $348,106 $9,234,001 $1,946,598$13,023,196 $13,371,302 $14,363,9772 T bi I iti l E E Grant fundingHydro Investment Costs Hydroelectric Generation Costs, no heat Excess Energy Potential - 2 turbines, no heatYear2014Hydro Design Cost, $2014Hydro Construction Cost, $2014Total Cost, 1 Turbine Initial, $20142 Turbine Initial Install Cost (for Excess Energy Utilization), $2014Total Cost, 2 Turbines, $2014Hydro O&M Cost, $2014Electric Demand, kWhDiesel Electric Generation, kWhHydro Electric Generation, kWhDiesel Electric Fuel Used, galDiesel Run Hours1 Turbine Initial Install Total Hydro Cost, $20142 Turbine Initial Install Total Hydro Cost, $2014Remaining Energy Available, kWhEquivalent Displaced Fuel, galsExcess Energy Benefit, fuel only (non fuel savings subtracted), $2014$0$0$0$0$0$0915 059915 05965 3618 760$420 602$420 602$020142015201620172018$0$0$0$0$0$0915,059915,05965,3618,760$420,602$420,602- $0$359,054 $0 $359,054 $0 $359,054 $0 933,360933,360 66,669 8,760 $795,070 $795,070 - $0$702,757 $0 $702,757 $0 $702,757 $0 952,027 952,027 68,002 8,760 $1,141,398 $1,141,398 - $0$38,189 $8,500,000 $8,538,189$750,000 $9,288,189 $85,000 971,068 1,726 969,342 123 37 $8,624,382 $9,374,382 2,500,953 178,640 $547,108$0$0$0$0$0$85 000990 4892 325988 16516649$86 615$86 6152 482 130177 295$551 28120182019202020212022$0$0$0$0$0$85,000990,4892,325988,16516649$86,615$86,6152,482,130 177,295 $551,281$0 $0 $0 $0 $0 $85,000 1,010,299 3,0271,007,272 216 64 $87,114 $87,114 2,463,023 175,930 $555,600$0 $0 $0 $0 $0 $85,000 1,030,505 4,1481,026,357 296 88 $87,918 $87,918 2,443,938 174,567 $562,875$0 $0 $0 $0 $0 $85,000 1,051,115 5,2911,045,824 378 113 $88,750 $88,750 2,424,471 173,177 $570,023$0$0$0$0$0$85,000 1,072,137 6,457 1,065,680 461 137$89,611$89,611 2,404,615 171,758 $577,4872023202420252026$$$$$$,,,,,,$,$,,,,$,$0 $0 $0 $0 $0 $85,000 1,093,580 7,6471,085,933 546 163 $90,503 $90,503 2,384,362 170,312 $584,856$0 $0 $0 $0 $0 $85,000 1,115,452 9,1821,106,270 656 195 $91,660 $91,660 2,364,025 168,859 $592,579$0 $0 $0 $0 $0 $85,000 1,137,761 10,8321,126,929 774 230 $92,917 $92,917 2,343,366 167,383 $599,775$0 $0 $0 $0 $0 $85,000 1,160,516 12,5151,148,001 894 266 $94,216 $94,216 2,322,294 165,878 $606,36920272028202920302031$0 $0 $0 $0 $0 $85,000 1,183,726 14,231 1,169,495 1,017 303 $95,555 $95,555 2,300,800 164,343 $611,906$0 $0 $0 $0 $0 $85,000 1,207,401 16,422 1,190,979 1,173 349 $97,274 $97,274 2,279,316 162,808 $618,740$0 $0 $0 $0 $0 $85,000 1,231,549 18,803 1,212,746 1,343 400 $99,155 $99,155 2,257,549 161,254 $624,419$0 $0 $0 $0 $0 $85,000 1,256,180 21,232 1,234,948 1,517 452 $101,101 $101,101 2,235,347 159,668 $630,042$0$0$0$0$0$85 0001 281 30423 7221 257 5811 694505$103 113$103 1132 212 714158 051$634 62420312032203320342035$0$0$0$0$0$85,0001,281,30423,7221,257,5811,694505$103,113$103,1132,212,714 158,051 $634,624$0 $0 $0 $0 $0 $85,000 1,306,930 27,671 1,279,259 1,976 589 $106,287 $106,287 2,191,036 156,503 $641,027$0 $0 $0 $0 $0 $85,000 1,333,068 31,698 1,301,370 2,264 674 $109,578 $109,578 2,168,925 154,923 $647,796$0 $0 $0 $0 $0 $85,000 1,359,730 35,807 1,323,923 2,558 762 $112,980 $112,980 2,146,372 153,312 $654,151$0$0$0$0$0$85 0001 386 92440 0851 346 8392 863853$116 538$116 5382 123 456151 675$658 60820352036203720382039$0$0$0$0$0$85,0001,386,92440,0851,346,8392,863853$116,538$116,5382,123,456 151,675 $658,608$0 $0 $0 $0 $0 $85,000 1,414,663 44,530 1,370,132 3,181 947 $120,265 $120,265 2,100,163 150,012 $662,391$0 $0 $0 $0 $0 $85,000 1,442,956 49,065 1,393,891 3,505 1,044 $124,115 $124,115 2,076,404 148,315 $666,023$0 $0 $0 $0 $0 $85,000 1,471,815 52,975 1,418,840 3,784 1,127 $127,519 $127,519 2,051,456 146,533 $668,904$0$0$0$0$0$85 0001 501 25154 9711 446 2803 9271 170$129 423$129 4232 024 015144 572$669 95120392040204120422043$0$0$0$0$0$85,0001,501,25154,9711,446,2803,9271,170$129,423$129,4232,024,015 144,572 $669,951$0 $0 $0 $0 $0 $85,000 1,531,276 57,007 1,474,269 4,072 1,213 $131,387 $131,387 1,996,026 142,573 $670,696$0 $0 $0 $0 $0 $85,000 1,561,902 59,452 1,502,450 4,247 1,265 $133,708 $133,708 1,967,845 140,560 $671,408$0 $750,000 $750,000 -$750,000 $0 $85,000 1,593,140 63,399 1,529,741 4,528 1,346 $887,272 $137,272 1,940,554 138,611 $672,945$0 $0 $0 $0 $0 $85,000 1,625,003 67,425 1,557,578 4,816 1,430 $140,952 $140,952 1,912,717 136,623 $674,1572044204520462047,,,,,,,,,,,,,,$0 $0 $0 $0 $0 $85,000 1,657,503 71,844 1,585,659 5,132 1,518 $144,941 $144,941 1,884,636 134,617 $675,207$0 $0 $0 $0 $0 $85,000 1,690,653 77,029 1,613,624 5,502 1,614 $149,473 $149,473 1,856,671 132,619 $676,302$0 $0 $0 $0 $0 $85,000 1,724,466 82,318 1,642,148 5,880 1,711 $154,158 $154,158 1,828,147 130,582 $677,027$0 $0 $0 $0 $0 $85,000 1,758,955 87,942 1,671,014 6,282 1,803 $158,954 $158,954 1,799,282 128,520 $677,33820482049205020512052$0 $0 $0 $0 $0 $85,000 1,794,134 93,840 1,700,294 6,703 1,890 $163,885 $163,885 1,770,001 126,429 $677,226$0 $0 $0 $0 $0 $85,000 1,830,017 99,857 1,730,160 7,133 1,980 $168,991 $168,991 1,740,135 124,295 $676,699$0 $0 $0 $0 $0 $85,000 1,866,617 106,568 1,760,049 7,612 2,061 $174,367 $174,367 1,710,246 122,160 $675,819$0 $0 $0 $0 $0 $85,000 1,903,950 113,416 1,790,534 8,101 2,145 $179,940 $179,940 1,679,761 119,983 $674,486$0$0$0$0$0$85 0001 942 029120 1451 821 8838 5822 213$185 290$185 2901 648 412117 744$672 24420522053205420552056$0$0$0$0$0$85,0001,942,029120,1451,821,8838,5822,213$185,290$185,2901,648,412 117,744 $672,244$0 $0 $0 $0 $0 $85,000 1,980,869 126,785 1,854,084 9,056 2,269 $190,460 $190,460 1,616,211 115,444 $669,106$0 $0 $0 $0 $0 $85,000 2,020,487 133,995 1,886,491 9,571 2,330 $196,119 $196,119 1,583,804 113,129 $665,706$0 $0 $0 $0 $0 $85,000 2,060,896 143,312 1,917,584 10,237 2,410 $203,316 $203,316 1,552,711 110,908 $663,059$0$0$0$0$0$85 0002 102 114152 8151 949 29910 9152 491$210 794$210 7941 520 996108 643$659 87020562057205820592060$0$0$0$0$0$85,0002,102,114152,8151,949,29910,9152,491$210,794$210,7941,520,996 108,643 $659,870$0 $0 $0 $0 $0 $85,000 2,144,157 164,236 1,979,920 11,731 2,584 $219,661 $219,661 1,490,375 106,455 $657,209$0 $0 $0 $0 $0 $85,000 2,187,040 175,999 2,011,041 12,571 2,680 $228,952 $228,952 1,459,254 104,232 $654,069$0 $0 $0 $0 $0 $85,000 2,230,780 187,534 2,043,246 13,395 2,755 $237,933 $237,933 1,427,049 101,932 $649,672$0$0$0$0$0$85,0002,275,396199,1762,076,22014,2272,825$247,093$247,0931,394,07599,577$644,4632060206120622063$0$0$0$0$0$85,0002,275,396199,1762,076,22014,2272,825$247,093$247,0931,394,075 99,577 $644,463$0 $0 $0 $0 $0 $85,000 2,320,904 211,744 2,109,160 15,125 2,896 $257,006 $257,006 1,361,135 97,224 $638,972$0 $0 $0 $0 $0 $85,000 2,367,322 224,824 2,142,498 16,059 2,969 $267,471 $267,471 1,327,797 94,843 $632,948$0 $0 $0 $0 $0 $85,000 2,414,668 237,746 2,176,923 16,982 3,021 $277,682 $277,682 1,293,372 92,384 $625,5359/4/2014Page 2 of 320140904‐power‐model.xlsx Economic Update and Heating Analysis Result TablesAlaska Village Electric Alaska CooperativeOld Harbor Hydroelectric ProjectSUM 50YRSNPV 50YRS77,400,000 99,860,000 6,350,000 71,040,000 450,000 11,940,000 87,920,000 2,751,316 $250,000 $0 $41,800,000 80,121,1425,722,939 $25,250,000 $0$222,122 $84,902 $24,155,032 $12,085,650 $263,203E E Hydroelectric Generation costs, Dispatchable Heat Excess Energy Potential - 2 turbines, Dispatchable HeatYear2014Electric Demand, kWhHeat Demand, kWhDiesel Electric Generation, kWhHydro Electric Generation, kWhDiesel Electric Fuel Used, galDiesel Run HoursHydroelectric Heating, kWhDiesel Fired Heating, kWhDiesel Heating Fuel Used, galElectric Boiler Equip Cost, $2014Second Turbine, $2014Total Hydro Cost, $2014Remaining Energy Available, kWhEquivalent Displaced Fuel, galsExcess Energy Benefit, fuel only (non fuel savings subtracted), $2014Cost Addition for 2 turbines, $2014915 0591 997 143915 05965 3618 7601 997 14362 500$0$0$776 85200$020142015201620172018915,0591,997,143915,05965,3618,7601,997,14362,500$0$0$776,85200$0933,360 1,997,143 933,360 66,669 8,760 1,997,143 62,500$0 $0 $1,165,565 0 0 $0952,027 1,997,143 952,027 68,002 8,760 1,997,143 62,500$0 $0 $1,508,172 0 0 $0971,068 1,997,143 1,726 969,342 123 37286,075 1,711,069 53,547 $250,000 $0 $9,188,535 2,214,879 158,206 $465,504 $750,000990 4891 997 1432 325988 16516649285 6541 711 48953 561$0$0$404 9722 196 476156 891$468 727$020182019202020212022990,4891,997,1432,325988,16516649285,6541,711,48953,561$0$0$404,9722,196,476156,891$468,727$01,010,299 1,997,143 3,0271,007,272 216 64 285,287 1,711,856 53,572 $0 $0 $409,8152,177,736 155,553 $472,045 $01,030,505 1,997,143 4,1481,026,357 296 88 285,182 1,711,961 53,575 $0 $0 $416,2342,158,756 154,197 $477,902 $01,051,115 1,997,143 5,2911,045,824 378 113 285,075 1,712,069 53,579 $0 $0 $422,7612,139,397 152,814 $483,615 $01,072,137 1,997,143 6,457 1,065,680 461 137 284,965 1,712,178 53,582$0$0$429,606 2,119,650 151,404$489,570$02023202420252026,,,,,,,,,,,$$$,,,,$,$1,093,580 1,997,143 7,6471,085,933 546 163 284,854 1,712,290 53,586 $0 $0 $436,5912,099,508 149,965 $495,404 $01,115,452 1,997,143 9,1821,106,270 656 195 284,462 1,712,681 53,598 $0 $0 $444,1162,079,563 148,540 $501,628 $01,137,761 1,997,143 10,8321,126,929 774 230 283,989 1,713,154 53,613 $0 $0 $451,6502,059,377 147,098 $507,383 $01,160,516 1,997,143 12,5151,148,001 894 266 283,506 1,713,637 53,628 $0 $0 $459,1132,038,787 145,628 $512,575 $0202720282029203020311,183,726 1,997,143 14,231 1,169,495 1,017 303 283,014 1,714,129 53,643 $0 $0 $466,2872,017,786 144,128 $516,805 $01,207,401 1,997,143 16,422 1,190,979 1,173 349 282,380 1,714,763 53,663 $0 $0 $474,5191,996,936 142,638 $522,222 $01,231,549 1,997,143 18,803 1,212,746 1,343 400 281,688 1,715,455 53,685 $0 $0 $482,4961,975,861 141,133 $526,620 $01,256,180 1,997,143 21,232 1,234,948 1,517 452 280,983 1,716,160 53,707 $0 $0 $490,7001,954,364 139,597 $530,936 $01 281 3041 997 14323 7221 257 5811 694505280 2681 716 87553 729$0$0$498 6451 932 445138 032$534 307$0203120322033203420351,281,3041,997,14323,7221,257,5811,694505280,2681,716,87553,729$0$0$498,6451,932,445138,032$534,307$01,306,930 1,997,143 27,671 1,279,259 1,976 589 280,062 1,717,082 53,736 $0 $0 $508,2021,910,975 136,498 $539,178 $01,333,068 1,997,143 31,698 1,301,370 2,264 674 279,851 1,717,292 53,742 $0 $0 $518,2571,889,075 134,934 $544,324 $01,359,730 1,997,143 35,8071,323,923 2,558 762 279,636 1,717,508 53,749 $0 $750,000 $1,278,421 1,866,736 133,338 $549,061 -$750,0001 386 9241 997 14340 0851 346 8392 863853279 0321 718 11153 768$0$0$538 0261 844 424131 745$552 256$0203520362037203820391,386,9241,997,14340,0851,346,8392,863853279,0321,718,11153,768$0$0$538,0261,844,424131,745$552,256$01,414,663 1,997,143 44,530 1,370,132 3,181 947 278,066 1,719,078 53,798 $0 $0 $547,7111,822,097 130,150 $554,970 $01,442,956 1,997,143 49,065 1,393,891 3,505 1,044 277,080 1,720,063 53,829 $0 $0 $557,6561,799,324 128,523 $557,519 $01,471,815 1,997,143 52,975 1,418,840 3,784 1,127 275,521 1,721,622 53,878 $0 $0 $567,4291,775,934 126,852 $559,524 $01 501 2511 997 14354 9711 446 2803 9271 170272 3871 724 75653 976$0$0$576 2391 751 628125 116$560 317$0203920402041204220431,501,2511,997,14354,9711,446,2803,9271,170272,3871,724,75653,976$0$0$576,2391,751,628125,116$560,317$01,531,276 1,997,143 57,007 1,474,269 4,072 1,213 269,190 1,727,953 54,076 $0 $0 $585,2641,726,836 123,345 $560,840 $01,561,902 1,997,143 59,452 1,502,450 4,247 1,265 265,979 1,731,164 54,176 $0 $0 $594,7861,701,866 121,562 $561,345 $01,593,140 1,997,143 63,399 1,529,741 4,528 1,346 262,902 1,734,241 54,273 $0 -$750,000 $605,651 1,677,652 119,832 $562,629 $01,625,003 1,997,143 67,425 1,557,578 4,816 1,430 259,764 1,737,379 54,371 $0 $0 $616,785 1,652,953 118,068 $563,623 $02044204520462047,,,,,,,,,,,,,,,,,,1,657,503 1,997,143 71,844 1,585,659 5,132 1,518 256,604 1,740,539 54,470 $0 $0 $628,3691,628,032 116,288 $564,476 $01,690,653 1,997,143 77,029 1,613,624 5,502 1,614 253,471 1,743,672 54,568 $0 $0 $640,6251,603,200 114,514 $565,374 $01,724,466 1,997,143 82,318 1,642,148 5,880 1,711 250,276 1,746,867 54,668 $0 $0 $653,1901,577,871 112,705 $565,944 $01,758,955 1,997,143 87,942 1,671,014 6,282 1,803 246,578 1,750,565 54,783 $0 $0 $666,1681,552,703 110,907 $566,338 $0204820492050205120521,794,134 1,997,143 93,840 1,700,294 6,703 1,890 242,496 1,754,648 54,911 $0 $0 $679,5541,527,505 109,108 $566,501 $01,830,017 1,997,143 99,857 1,730,160 7,133 1,980 238,331 1,758,812 55,041 $0 $0 $693,3041,501,803 107,272 $566,314 $01,866,617 1,997,143 106,568 1,760,049 7,612 2,061 234,166 1,762,978 55,172 $0 $0 $707,4901,476,081 105,434 $565,802 $01,903,950 1,997,143 113,416 1,790,534 8,101 2,145 229,917 1,767,227 55,305 $0 $0 $722,0701,449,844 103,560 $564,904 $01 942 0291 997 143120 1451 821 8838 5822 213225 6121 771 53155 440$0$0$736 6171 422 799101 629$563 155$0205220532054205520561,942,0291,997,143120,1451,821,8838,5822,213225,6121,771,53155,440$0$0$736,6171,422,799101,629$563,155$01,980,869 1,997,143 126,785 1,854,084 9,056 2,269 221,248 1,775,895 55,576 $0 $0 $751,1811,394,962 99,640 $560,571 $02,020,487 1,997,143 133,995 1,886,491 9,571 2,330 216,928 1,780,215 55,711 $0 $0 $766,4051,366,876 97,634 $557,739 $02,060,896 1,997,143 143,312 1,917,584 10,237 2,410 213,108 1,784,035 55,831 $0 $0 $783,1911,339,602 95,686 $555,440 $02 102 1141 997 143152 8151 949 29910 9152 491209 2121 787 93155 953$0$0$800 4711 311 78493 699$552 667$0205620572058205920602,102,1141,997,143152,8151,949,29910,9152,491209,2121,787,93155,953$0$0$800,4711,311,78493,699$552,667$02,144,157 1,997,143 164,236 1,979,920 11,731 2,584 206,265 1,790,878 56,045 $0 $0 $819,0151,284,109 91,722 $549,958 $02,187,040 1,997,143 175,999 2,011,041 12,571 2,680 203,327 1,793,817 56,137 $0 $0 $838,1671,255,928 89,709 $546,783 $02,230,780 1,997,143 187,534 2,043,246 13,395 2,755 199,637 1,797,506 56,252 $0 $0 $857,4571,227,412 87,672 $542,770 $02,275,3961,997,143199,1762,076,22014,2272,825195,6881,801,45656,376$0$0$877,2181,198,38785,599$538,116$020602061206220632,275,3961,997,143199,1762,076,22014,2272,825195,6881,801,45656,376$0$0$877,2181,198,38785,599$538,116$02,320,904 1,997,143 211,744 2,109,160 15,125 2,896 191,456 1,805,687 56,508 $0 $0 $898,0431,169,679 83,549 $533,372 $02,367,322 1,997,143 224,824 2,142,498 16,059 2,969 187,063 1,810,081 56,646 $0 $0 $919,6931,140,735 81,481 $528,225 $02,414,668 1,997,143 237,746 2,176,923 16,982 3,021 182,565 1,814,579 56,787 $0 $0 $941,3521,110,808 79,343 $521,794 $09/4/2014Page 3 of 320140904‐power‐model.xlsx Department of Natural Resources Division of Mining, Land & Water Water Resources Section Southeastern Office P. O. Box 111020 Juneau, Alaska 99811-1020 Main: 907.465.3400 TDD: 907.465.3888 Fax: 907.586.2954 July 31, 2014 Kate Arduser Solstice Alaska Consulting 2607 Fairbanks St, Anchorage, AK 99503 Re: Old Harbor Hydroelectric Project Kate, Our records show that Alaska Village Electric Cooperative (AVEC) applied for water rights for the Old Harbor Hydroelectric Project for water from Mountain Creek near Old Harbor on Kodiak Island, Alaska. The priority date for the application is May 1999 and the file number is LAS 22628. The Alaska Department of Natural Resources (DNR) allocates water according to seniority of priority date and there are no senior appropriators on Mountain Creek. The application is complete and DNR does not require anything further from AVEC at this point. However, DNR has not granted a permit to appropriate water because it is our policy to hold off granting a permit to appropriate water until FERC grants a license. We do this to ensure the conditions on the permit mirror those in the FERC license. As you know the FERC license process can take time. As project plans develop DNR may require further information from AVEC. If you or anyone working with you on this project has any questions or comments, please contact me. Sincerely, Carl Reese Natural Resource Manager Carl.Reese@alaska.gov (907) 465-2533 FERC 13272 −004 (401 −Waiver).docx̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅̅ 555 Cordova Street Anchorage, Alaska 99501-2617 Main: 907.269.6285 Fax: 907.334.2415 www.dec.alaska.gov/water/wwdp July 14, 2014 Certified Mail: 7012-3460-0002-9326-7008 Meera Kohler Alaska Village Electric Cooperative, Inc (AVEC) 4831 Eagle Street Anchorage, AK 99503 Re: FERC No. 13272-004 – Alaska, Old Harbor Hydroelectric Project, AVEC. Dear Ms. Kohler, In accordance with Section 401 of the Federal Clean Water Act of 1977 and provisions of the Alaska Water Quality Standards, the Department of Environmental Conservation (DEC) is waiving its right to issue a Certificate of Reasonable Assurance for licensing Federal Energy Regulatory Commission (FERC) Project No. 13272-004 – Alaska, Old Harbor Hydroelectric Project, AVEC. DEC reserves the right to review future construction projects, as they may arise, in accordance with Section 401 of the Clean Water Act of 1977, and the provisions of the Alaska Water Quality Standards (18 AAC 70). DEC regulations provide that any person who disagrees with this decision may request an informal review by the Division Director in accordance with 18 AAC 15.185 or an adjudicatory hearing in accordance with 18 AAC 15.195 – 18 AAC 15.340. An informal review request must be delivered to the Director, Division of Water, 555 Cordova Street, Anchorage, AK 99501, within 15 days of the permit decision. Visit http://www.dec.state.ak.us/commish/ReviewGuidance.htm for information on Administrative Appeals of Department decisions. An adjudicatory hearing request must be delivered to the Commissioner of the Department of Environmental Conservation, 410 Willoughby Avenue, Suite 303, PO Box 111800, Juneau, AK 99811- 1800, within 30 days of the permit decision. If a hearing is not requested within 30 days, the right to appeal is waived. If you have any questions regarding the above, please contact me at 907.334.2288 or via email at James.Rypkema@alaska.gov. Sincerely, James Rypkema Section Manager, Storm Water and Wetlands cc: Michael Daigneault, ADF&G USFWS Field Office, Anchorage Heather Dean, EPA Operations, Anchorage Kate Arduser, Solstice Alaska Consulting, Inc. Adam Beeco, FERC