HomeMy WebLinkAboutAEA Renewable Energy Round VIII application - Complex FINALKETCHIKAN GATEWAY BOROUGH
OFFICIAL BOROUGH DOCUMENT
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New Document Number: 1 . I
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Type of Document:
Grant
Description of Document:
Amendment or attachment I
to·existing Borough
Document No.:
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AEA Grant Ketchikan Gateway Borough Recreation and Schools Central Heating Plant Design
Parties to Document:
Ketchikan Gatewa Borou h and Alaska Ener Authorit
Begin Date: 9/22/20141End Date: ,__ ________ __,,Total Amount:
Return This Form To:
ITEMS JQBECOMPLETEP PRIOR TO FILING DOCUMENT WITH CLERK'S OFFICE
DJ\TEANDINIT.IALS. ROUTING ORDER ACTION
---~----9_121_2_0_1_4 1. Assembly Approval [If Required] Include Ordinance or Resolution Number
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Content Review
Taxes Owed Status
Legal Review/Approved as to Form
Review for all Grant Agreements
Certify Funds Available
Review for all Lease Agreements
Task Tracker
Review
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
Application Forms and Instructions
This instruction page and the following grant application constitutes the Grant Application Form for
Round VIII of the Renewable Energy Fund Heat Projects only. If your application is for energy
projects that will not primarily produce heat, please use the standard application form (see RFA
section 1.5). An electronic version of the Request for Applications (RFA) and both application
forms are available online at: www.akenergyauthority.org/REFund8.html.
• If you need technical assistance filling out this application, please contact Shawn Calfa, the
Alaska Energy Authority Grants Administrator at (907) 771-3031 or at scalfa@aidea.org.
• If you are applying for grants for more than one project, provide separate application forms
for each project.
• Multiple phases for the same project may be submitted as one application.
• If you are applying for grant funding for more than one phase of a project, provide
milestones and budget for each phase of the project.
• In order to ensure that grants provide sufficient benefit to the public, AEA may limit
recommendations for grants to preliminary development phases in accordance with 3 ACC
107.605(1).
• If some work has already been completed on your project and you are requesting funding
for an advanced phase, submit information sufficient to demonstrate that the preceding
phases are completed and funding for an advanced phase is warranted.
• If you have additional information or reports you would like the Authority to consider in
reviewing your application, either provide an electronic version of the document with your
submission or reference a web link where it can be downloaded or reviewed.
• In the sections below, please enter responses in the spaces provided, often under the
section heading. You may add additional rows or space to the form to provide sufficient
space for the information, or attach additional sheets if needed.
REMINDER:
• Alaska Energy Authority is subject to the Public Records Act AS 40.25, and materials
submitted to the Authority may be subject to disclosure requirements under the act if no
statutory exemptions apply.
• All applications received will be posted on the Authority web site after final
recommendations are made to the legislature.
• In accordance with 3 AAC 107.630 (b) Applicants may request trade secrets or proprietary
company data be kept confidential subject to review and approval by the Authority. If you
want information to be kept confidential the applicant must:
o Request the information be kept confidential.
o Clearly identify the information that is the trade secret or proprietary in their
application.
o Receive concurrence from the Authority that the information will be kept confidential.
If the Authority determines it is not confidential it will be treated as a public record in
accordance with AS 40.25 or returned to the applicant upon request.
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
SECTION 1 – APPLICANT INFORMATION
Name (Name of utility, IPP, or government entity submitting proposal)
Ketchikan Gateway Borough
Type of Entity: Second-Class Borough Fiscal Year End: June 30
Tax ID # 92-0084626
Tax Status: ☐ For-profit ☐ Non-profit ☒ Government (check one)
Date of last financial statement audit: 6/30/2013
Mailing Address: Physical Address:
1900 First Avenue, Ste. 210
Ketchikan, AK 99901
1900 First Avenue, Ste. 210
Ketchikan, AK 99901
Telephone: Fax: Email:
(907) 228-6738 managersoffice@kgbak.us
eds@kgbak.us
1.1 APPLICANT POINT OF CONTACT / GRANTS MANAGER
Name: Title:
Dan Bockhorst Borough Manager
Mailing Address:
1900 First Ave., Ste. 210
Ketchikan, AK 99901
Telephone: Fax: Email:
(907) 228-6738 managersoffice@kgbak.us
danb@kgbak.us
1.1.1 APPLICANT ALTERNATE POINTS OF CONTACT
Name Telephone: Fax: Email:
Ed Schofield (907) 228-6645 eds@kgbak.us
1.2 APPLICANT MINIMUM REQUIREMENTS
Please check as appropriate. If you do not to meet the minimum applicant requirements, your
application will be rejected.
1.2.1 As an Applicant, we are: (put an X in the appropriate box)
☐ 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)
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
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 governing
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/vREFund8.html. (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)
SECTION 2 – PROJECT SUMMARY
This section is intended to be no more than a 2-3 page overview of your project.
2.1 Project Title – (Provide a 4 to 7 word title for your project). Type in space below.
Gateway Borough Recreation and Schools Central Heating Plant Design
2.2 Project Location –
Include the physical location of your project and name(s) of the community or communities that will
benefit from your project in the subsections below.
2.2.1 Location of Project – Latitude and longitude, 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.
Schoenbar Middle School: 55.345170, -131.637603; 217 Schoenbar Road
Ketchikan Gateway Borough School District Maintenance Facility: 55.346158, -131.639423; 333
Schoenbar Road
Valley Park School: 55.347579, -131.639585; 410 Schoenbar Road
Gateway Recreation Center / Aquatic Center: 55.347, -131.641339; 601 Schoenbar Road
2.2.2 Community benefiting – Name(s) of the community or communities that will be the
beneficiaries of the project.
Ketchikan Gateway Borough
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
2.3 PROJECT TYPE
Put X in boxes as appropriate
2.3.1 Renewable Resource Type
☐ Wind to Heat ☒ Biomass or Biofuels
☐ Hydro to Heat ☐ Solar Thermal
☐ Heat Recovery from Existing Sources ☐ Heat Pumps
☐ Other (Describe) ☐
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
2.4 PROJECT DESCRIPTION
Provide a brief one paragraph description of the proposed heat project.
Ketchikan Gateway Borough seeks to secure its future energy independence through the
construction of biomass-fired building heating systems throughout the local schools and the
recreation facilities. The most viable location for a large scale project is at the Schools/Recreation
complex located westerly of Schoenbar Road, consisting of Schoenbar Middle School, Valley Park
School, the Gateway Recreation Center/Aquatic Center, and the Ketchikan Gateway Borough
School District Maintenance Facility, an area comprising 207,000 square feet of building space.
The central woody biomass fired boilers will provide 100% heat to the recreation and school
facilities in the area, with the existing oil fired or electrical boilers to remain and pick up the
“shoulder” heating times. The woody biomass fired boilers will replace outdated heating oil boilers,
which will become more costly to maintain and are run on heating oil number 2, a more expensive
fuel source than locally sourced woody biomass. In addition, the Gateway Aquatic Center uses an
electric boiler system, resulting in electrical generation being put towards heat rather than being
utilized for industrial activities.
A central heating complex of this type will help to stabilize and secure the forest products industry
of Southeast Alaska through the sourcing of locally produced wood pellets. Engineering/Design to
be funded through this grant request will determine the recommended boiler sizing and pipe
routing to accommodate each facility, identify and design architectural and engineering needs, and
determine the system parameters required for providing heat specific to each facility.
2.5 PROJECT BENEFIT
Briefly discuss the financial and public benefits that will result from this heat project, (such as
reduced fuel costs, lower energy costs, local jobs created, etc.)
In direct benefit to the Borough, this project will produce cost savings from reduced fuel costs and
lower energy costs due to the use of modern, highly energy efficient systems. Economic benefits
will include short term jobs due to construction and long-term jobs in operating the plant, in addition
to stimulating a biomass “micro-economy” in order to generate and utilize a locally available fuel
source. The direct and indirect employment opportunities resulting from this project benefit both
the Ketchikan Gateway Borough as well as the overall local and regional economy.
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
The pellet production industry in and around Ketchikan will receive the greatest long -term
beneficial impact from the construction of the biomass energy facilities in Ketchikan, as each
project provides additional (1) market security for producers to respond with construction of
pelletmaking machinery, and (2) further stimulus for the local timber industry to justify equipment to
harvest young growth thinning opportunities as well as gather post-harvest forest residues
commonly left in the forest.
Currently, the Federal Government, Forest Service, and City of Ketchikan have biomass boilers in
service. The stimulation of the local biomass “micro-economy” will foster others to embrace
biomass boilers in the community and the region.
Moreover, the conversion of these facilities to biomass heating will enable the Borough to utilize
locally available renewable energy resources without having to compete with industrial users for
the use of the region’s primary renewable energy resource, hydroelectricity. This trend has been
particularly pronounced in Ketchikan, given the ready availability of hydroelectric resources and the
market fluctuations of fuel oil in recent years, and is particularly apparent given the decision to use
electrical boilers in the Gateway Aquatic Center. As noted by Black & Veatch in the Southeast
Alaska Integrated Resources Plan, “the ‘Achilles Heel’ of the current hydro system is the recent
trend toward conversion of fuel oil space heating to electric space heating in those communities
with access to low cost hydroelectric.” Biomass conversion in this area will free up approximately
4,542,000 kW/hr of hydroelectric that can then be better utilized for potential industrial
development in the area.
2.6 PROJECT BUDGET OVERVIEW
Briefly discuss the amount of funds needed, the anticipated sources of funds, and the nature and
source of other contributions to the project.
Ketchikan Gateway Borough is requesting $220,000 to support its efforts to develop biomass
energy projects for heating Schoenbar, the Recreation/Aquatic Center, Valley Park and the
Maintenance Facility. Significant funds have already been expended in evaluating the feasibility of
this project. Funding in this request will be used for fund both the Phase II and Phase III work.
2.7 COST AND BENEFIT SUMARY
Summarize the grant request and the project’s total costs and benefits below.
Costs for the Current Phase Covered by this Grant
(Summary of funds requested)
2.7.1 Grant Funds Requested in this application $ 220,000
0=
2.7.2 Cash match to be provided $ 0
2.7.3 In-kind match to be provided $ 0
2.7.4 Other grant funds to be provided $ 0
2.7.5 Total Costs for Requested Phase of Project (sum of 2.7.1 through 2.7.4) $220,000
Other items for consideration
2.7.6 Other grant applications not yet approved $ 0
0
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
2.7.7 Biomass or Biofuel Inventory on hand $ 0
2.7.8 Energy efficiency improvements to buildings
to be heated (upgraded within the past 5 years or
committed prior to proposed project completion) $ 0
Project Costs & Benefits
(Summary of total project costs including work to date and future cost estimates to get to a fully
operational project)
2.7.9 Total Project Cost
Summary from Cost Worksheet, Section 4.4.4, including
estimates through construction.
$ 2,200,000
(Future cost of construction)
2.7.10 Additional Performance Monitoring Equipment not
covered by the project but required for the Grant
Only applicable to construction phase projects
$ 0
2.7.11 Estimated Direct Financial Benefit (Savings)
The economic model used by AEA is available
at www.akenergyauthority.org/REFund8.html. This
economic model may be used by applicants but is not
required. Other economic models developed by the
applicant may be used, however the final benefit/cost
ratio used will be derived from the AEA model to
ensure a level playing field for all applicants.
$ 4,474,027
2.7.12 Other Public Benefit
If you can calculate the benefit in terms of dollars please
provide that number here and explain how you
calculated that number in Section 5 below.
$
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
SECTION 3 – PROJECT MANAGEMENT PLAN
Describe who will be responsible for managing the project and provide a plan for successfully
completing the project within the scope, schedule and budget proposed in the application.
3.1 Project Manager
Tell us who will be managing the project for the Grantee and include contact information, a resume
and references for the manager(s). 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 anticipates project management assistance from AEA or another
government entity, state that in this section.
The Borough intends to release a Request for Proposals to hire a Project Manager capable of
providing the appropriate guidance and recommendations to the Borough to ensure that the project
is designed and executed to the maximum efficiencies, control scope, maintain the project
schedule, and keep costs in line.
In-house project oversight will be conducted by Ed Schofield, Public Works Director for the
Ketchikan Gateway Borough, in partnership with Mike Williams, Ketchikan Gateway School District
Maintenance Superintendant.
3.2 Project Schedule and Milestones
Please fill out the schedule below. 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.
Please fill out form provided below. You may add additional rows as needed.
Milestones Tasks Start Date End Date
Phase II: Conceptual Design and Feasibility
1. Design Contract Issued 7/1/2015 10/15/2015
RFP solicitation issued 7/1/2015 9/1/2015
Review proposals 9/1/2015 9/15/2015
Award 9/15/2015 10/1/2015
Design contract issued 10/1/2015 10/15/2015
Notice to Proceed issued 10/15/2015 10/15/2015
2. Discovery 10/15/2015 11/15/2015
Project kick-off meeting 11/1/2015 11/1/2015
Prepare engineering memo on fuel requirements 11/2/2015 11/7/2015
First site visit – meeting with owner 11/8/2015 11/10/2015
First site visit – field data collection 11/8/2015 11/10/2015
Energy consumption and climate history 10/15/2015 11/15/2015
3. Engineering Evaluation
and Analysis
11/15/2015 11/30/2015
Establish interconnection and interoperability
requirements 11/15/2015 11/16/2015
Determine size and space constraints 11/16/2015 12/1/2015
Preliminary building and equipment layout diagrams 11/16/2015 11/17/2015
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
Biomass and trim boiler system sizing 11/17/2015 11/20/2015
Energy and mass balance 11/21/2015 11/24/2015
Hydraulic model 11/24/2015 12/1/2015
Phase III: Final Design and Permitting
4. Permitting 12/1/2015 12/2/2015
Determine regulatory requirements 12/1/2015 12/2/2015
Complete and submit required permitting documents
12/2/2015 12/2/2015
5. Mechanical Design 12/1/2015 1/15/2016
major system and component selection 12/1/2015 12/10/2015
detailed equipment design, layout and system drawings 12/11/2015 12/15/2015
generate electrical and structural coordination sheets 12/16/2015 12/20/2015
piping system schematic design and layout 12/20/2015 12/28/2015
define sequence of operations and controls interface 12/28/2015 12/31/2015
prepare commissioning plan and O&M manuals 1/6/2016 1/5/2016
prepare mechanical (div 15) specifications 1/7/2016 1/10/2016
finalize mechanical drawings and equipment lists 1/10/2016 1/15/2016
6. Electrical Design 12/16/2016 1/15/2016
prepare power system design, layout and drawings 12/20/2015 12/31/2015
prepare lighting system design, layout and drawings 12/28/2016 12/31/2015
prepare electrical (div 16) specifications 1/7/2016 1/10/2016
finalize electrical drawings 1/10/2016 1/15/2016
control system design and (DDC) integration 12/31/2015 1/15/2016
7. Structural Design 12/16/2016 1/15/2016
structural calculations 12/16/2015 12/20/2015
prepare slab and wall design, layout and drawings 12/21/2015 1/7/2016
prepare building design, layout and drawings 12/21/2015 1/7/2016
prepare structural specifications 1/7/2016 1/10/2016
finalize structural calculations and drawings 1/10/2016 1/15/2016
8. Financial Analysis 12/11/2015 1/1/2016
develop capital cost estimate 12/11/2015 12/15/2015
develop operating cost estimate 12/16/2015 12/20/2016
prepare and report financial model 12/21/2016 1/1/2016
9. Design Reviews and
Completion
1/16/2016 4/1/2016
30% design review 1/16/2016 2/1/2016
design completion to 90% 2/2/2016 3/1/2016
90% design review and final design updates 3/2/2016 3/31/2016
10. Permitting Completion 4/2/2016 4/30/2016
release permit set 4/2/2016 4/2/2016
Permit responses 4/3/2016 4/30/2016
11. Bid Set Preparation 3/1/2016 4/30/2016
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
3.3 Project Resources
Describe the personnel, contractors, personnel or firms, equipment, and services you will use to
accomplish the project. Include any partnerships or commitments with other entities you have or
anticipate will be needed to complete your project. Describe any existing contracts and the
selection process you may use for major equipment purchases or contracts. Include brief resumes
and references for known, key personnel, contractors, and suppliers as an attachment to your
application.
The following Borough employees will provide administrative support throughout the project.
Resumes are attached as Exhibit B-2:
Edward Schofield, Ketchikan Gateway Borough, Public Works Director
Ed Schofield has over twenty years of experience in electrical systems management, having
worked as Operations Manager for Ketchikan Public Utilities and as Operations Manager for
Southeast Alaska Power Agency. Ed also has an extensive background in the maintenance and
construction fields. As Public Works Director for the Ketchikan Gateway Borough, Ed will be the
primary contact for the Ketchikan Gateway Borough, and will coordinate the design and
construction with the Ketchikan Gateway Borough School District.
Amy Briggs, Ketchikan Gateway Borough, Procurement Officer
As the Borough’s Procurement Officer, Amy has worked as both Project Administrator and Grant
Administrator for several years. She has been directly involved in the procurement of millions of
dollars in goods and services utilizing grant funds. She is also the Borough’s contract writer.
Mike Williams, Ketchikan School District, Project Manager
Mike Williams is the supervisor of all School District buildings and grounds, Mike has over 30 years
in the maintenance and construction field. For the last 7 years he has been responsible for the
maintenance of all the Borough School buildings totaling $90 million in assets. In 2011 he
managed the $3.4 million re-roof of the Ketchikan High School. In 2013, he managed the Valley
Park Elementary school reroof costing $1.7 million.
3.4 Project Communications
Discuss how you plan to monitor the project and keep the Authority informed of the status. Please
provide an alternative contact person and their contact information.
The Ketchikan Gateway Borough project manager will be responsible for project monitoring and
direct contact with AEA. The project manager will, at a minimum, provide AEA with monthly
progress reports, report dispersal of grant funds, and organize monthly update meetings.
Progress Reports
Written progress reports will highlight activities undertaken with dates, results achieved, progress
towards stated milestones, and outline any unexpected delays, problems or difficulty that arise as
the project progresses. Reports will be submitted on a monthly basis.
Financial Reports
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
Concurrent with the progress reports, a financial report will be submitted. This report will outline the
utilization and dispersal of grant funding for the month, and over the life of the project. This report
will also actively track project costs against the project budget. Propose budget modifications and
manage cost overruns, as needed.
Monthly Meetings
Monthly meetings will take place via conference call or in person at a mutually agreed upon time.
Meetings will routinely take place 3-5 business days after progress and financial reports are
submitted. This is intended to allow AEA the opportunity to review the reports and ask questions
regarding project progress and grant utilization.
Monitoring and Performance Reporting Plan
Regular monitoring and performance will be documented and submitted to AEA for approval. This
will include continuous monitoring to verify and update projections and system efficiency.
3.5 Project Risk
Discuss potential problems and how you would address them.
Risk is extremely low for the Gateway Borough Recreation and Schools Central Heating Plant
Design.
The Borough is largely insulated from common sources of risk such as financial instability, though
the funding source for the overall project has yet to be determined and will likely be through a
mixture of local expenditures and federal and state grant, as they may become available.
Moreover, per Volume 2 of the Southeast Alaska Integrated Resource Plan (IRP) by Black &
Veach, in discussing the project development and operational risks, that document identifies
resolving the ineffectiveness and inefficiencies of individual projects through a coordinated process
of developing biomass resources. With the ongoing Ketchikan International Airport and Ketchikan
High School Biomass Boiler Projects currently under design, the Borough has shown its intent to
focus on biomass on a facility-wide scale in order to create the base for the industry. The Gateway
Borough Recreation and Schools Central Heating Plant is consistent with this philosophy, given
that it consolidates the heat availability for several facilities.
Relative to feedstock availability, per the Southeast Area Integrated Resource Plan by Black &
Veatch, Volume 2 section 17.1.28, “The region’s abundance of biomass resources… allows the
opportunity for the region to provide the majority of their space heating needs through local
sustainable renewable resources,” but it does identify the fuel supply risk as moderate, primarily
due to the feedstock availability being within the Tongass National Forest. As noted in that report
in section 15.7, “… the minimum amount of pellets necessary to initially support a mill is
approximately 10,000 tons annually.” Amongst Borough facilities alone, the Ketchikan
International Airport and Ketchikan High School will consume up to approximately 2,200 tons of
pellets annually; the Gateway Borough Recreation/Schools Facility will effectively double this
consumption. The community also hosts existing biomass boilers at the U.S. Forest Service
Southeast Alaska Discovery Center, Ketchikan Federal Building, and City of Ketchikan Public
Library. The progressive conversion of public facilities to biomass heat, alone, will likely provide
the base for a local pellet industry.
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Renewable Energy Fund Round VIII
Grant Application – Heat Projects
In terms of public support, the project is perceived positively throughout the community. As noted
by Black & Veatch: “the concept of using a local renewable resource that creates local jobs is well
received.”
In terms of siting a complex, the Borough-owned property on which it is intended to be located has
ample space for a new structure. Given the available space, factors such as favorable topography
and geology, proximity to structures, and existing clearances will be easily resolved during the
design process.
Finally, while only the Gateway Recreation Center and Maintenance Facility have boilers requiring
replacement within the next decade, the potential for establishing and stabilizing a sustainable
industry and the potential operational savings to accrue to the Borough are more than enough
cause to see this project accomplished within short order.
3.6 Project Accountant(s)
Tell us who will be performing the accounting of this Project for the Grantee and include contact
information, a resume and references for the project accountant(s). 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 project accounting support.
Mike Houts, Ketchikan Gateway Borough, Finance Director
Mike has over 30 years of financial management experience specializing in accounting systems for
Forest Products and Construction Companies.
Maureen Crosby, CPA., Ketchikan Gateway Borough, Controller
Maureen has been a Certified Public Accountant for 13 years, and has been in public accounting
for nearly 20.
3.7 Financial Accounting System
Discuss the accounting system that will be used to account for project costs and who will be the
primary user of the accounting system.
The Ketchikan Gateway Borough utilizes Financial Edge software by Blackbaud, of which the
Borough’s Finance Department is the primary user.
3.8 Financial Management Controls
Discuss 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.
Throughout the project, costs allocated to the project will be reviewed by Borough staff tasked with
Project Administration to determine their compliance with grant conditions. Prior to issuance of
reimbursement request, the Ketchikan Gateway Borough’s Finance Department staff also review
the cost allocation to verify grant conditions have been met.
The Ketchikan Gateway Borough also receives a yearly audit by the State of Alaska and employs a
Third-Party auditor to prepare a Comprehensive Annual Financial Report (CAFR), which is made
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Grant Application – Heat Projects
publically available on the Ketchikan Gateway Borough website (http://www.kgbak.us), to verify
that all internal controls are in order. Auditors also review each ongoing and finalized grant for
compliance with all grant conditions.
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Grant Application – Heat Projects
SECTION 4 – PROJECT DESCRIPTION AND TASKS
The level of information will vary according to phase(s) of the project you propose to undertake
with grant funds.
If some work has already been completed on the project and the funding request is for an
advanced phase, submit information sufficient to demonstrate that the preceding phases are
satisfied and funding for an advanced phase is warranted.
4.1 Proposed Energy Resource
Describe the potential extent/amount of the energy resource that is available.
Discuss the pros and cons of your proposed energy resource vs. other alternatives that may be
available, in 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.
Pellet fuels are the most consistent of all biomass feedstocks. Pre-processing of pellets to standard
specifications greatly reduces compatibility problems and operational issues with combustion
equipment. It is anticipated that the project will seek Pellet Fuels Institute Standard-grade fuel
pellets and equipment will be engineered to handle this grade. The higher allowable ash content in
the Standard-grade pellet can be made from non-merchantable biomass containing some bark
rather than the clean white heartwood required for Premium-grade pellets. Equipment designed for
Standard-grade pellets will accept Premium-grade pellets if that is the only supply availability. It is
expected that the recommended pellet boiler equipment be capable of processing microchip fuel
should that become available in the area.
Fuel pellet specifications can be found at the Pellet Fuels Institute website http://pelletheat.org/pfi
standards/pfi-standards-program/. Feedstock will be delivered via bulk truckload delivery by fuel
contractor.
• Amount: Combined Approximately 2,203 tons/year
• Pricing: 500 Tons/Year over 5 years: $275/ton
• Infrastructure requirements: Pellet Silo, Feed Auger
4.1.1 For Biomass Project only
Identify any wood inventory questions, such as:
• Ownership/Accessibility. Who owns the land and are their limitations and restrictions to
accessing the biomass resource?
• Inventory data. How much biomass is available on an annual basis and what types (species)
are there, if known? Please attach any forest inventory reports
The Ketchikan Gateway Borough is committed to using locally sourced woody biomass in order to
support Alaskan business. KGB has previously contacted Tongass Forest Enterprises to secure a
long term supply of wood pellets. Tongass Forest Enterprises has identified two local entities from
which they will be purchasing pulp-grade wood to produce wood pellets.
• Leask Lakes sale
• Brown mountain road boundary sale
Other projects in progress in the Tongass National Forest from which biomass may become
available include the Big Thorne and Saddle Lake sales.
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In a letter to the Borough, Tongass Forest Enterprises is on record as offering contracts up to 5
years in length, for volumes exceeding 500 tons/year at a price that is financially viable for this
project. Southeast Alaska as a whole has an opportunity, and perhaps a need to leverage woody
biomass resources for energy purposes.
Moreover, in a 2010 study conducted by the USFS entitled “Economic Analysis of Southeast
Alaska: Envisioning a Sustainable Economy with Thriving Communities”, it is noted that:
“A potential young growth market is biomass energy, although the potential remains unclear. Current
demand for biomass in Southeast Alaska is relatively small; wood chips and other mill wastes are sufficient
to meet local heating demands. But diesel is widely used for power and heat in Southeast Alaska, and
biomass might be developed into a more cost-effective energy sources. Wood fiber produced from thinning
young forests might be processed into wood pellets and other energy sources if demand comes to exceed
supply of wastes.”
This same report notes that 400,000 acres of Tongass National Forest are in young growth of
various native species, thus ensuring an ample supply for this and other wood energy projects in
the area.
In the event of a shortfall in available pellets from local manufacturers, Ketchikan is easily
accessible by barges from Seattle providing weekly scheduled service, by which means the
Washington, Oregon and Idaho pellet manufacturers may be tapped. Prince Rupert, a Canadian
town in British Columbia located ninety miles south of Ketchikan, also bears Pinnacle Renewable
Energy, Inc., the largest pellet manufacturer in North America.
4.2 Existing Energy System
4.2.1 Basic configuration of Existing Heating Energy System
Briefly discuss the basic configuration of the existing energy system. Include information about the
number, size, age, efficiency, and type of generation.
Buildings to be integrated into the Gateway Borough Recreation and Schools Central Heating Plant
Design have existing systems as follows:
● Schoenbar Middle School: (2) oil-fired boilers (1.358 MBH each), installed in 2004 (approx..),
66% efficiency (Per Heating System Retrofit Analysis by Alaska Energy Engineering, LLC)
● Gateway Recreation Center: (2) Weil McLain/788 oil-fired boilers (1,632 MBH), installed 1995
(Per Sheet M.01 of the Indoor Recreation Center planset by Kumin Associates, Inc.)
● Gateway Aquatic Center: (2) 520 kW/hr electric boilers, (1) 1,700 MBH fuel oil boiler, installed
2012, 96% efficiency, also used for heating the pools (Identified as Base Case - Alternative #2 per
Ketchikan Aquatic Center Alternative Energy Study by AMC Engineers)
● Ketchikan Gateway Borough School District Maintenance Facility: (1) oil-fired boiler (417
MBH) and high temperature distribution system (300 MBH), installed 1988, 68%, (Per Heating
System Retrofit Analysis by Alaska Energy Engineering, LLC)
● Valley Park School: (3) oil-fired boilers in a MacLaine 478 (400 MBH) and two WM 588’s
(1084 MBH) operated in a primary-secondary-tertiary arrangement, installed in 2001, 68%
efficiency (Per Heating System Retrofit Analysis by Alaska Energy Engineering, LLC)
4.2.2 Existing Heating Energy Resources Used
Briefly discuss your understanding of the existing energy resources. Include a brief discussion of
any impact the project may have on existing energy infrastructure and resources.
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The primary fuel source presently used to generate heat in the Ketchikan Gateway Borough is fuel
oil. The Ketchikan Gateway Borough’s current contract for fuel oil #2 is $3.42 - $3.47/gallon. Calls
to a local distributor indicate residential rates are as high as $4.07 - $4.34/gallon.
The proposed project will help the community by reducing the use of expensive fuel oil. The key
impact on infrastructure will involve changing buildings from liquid to solid fuel storage systems.
This is anticipated to be accomplished by erecting storage facilities adjacent to the heating
buildings.
4.2.3 Existing Heating Energy Market
Discuss existing energy use and its market. Discuss impacts your project may have on energy
customers.
The proposed project does not anticipate selling heat on the open market. It is intended to offset
present use of heating oil for boilers operated by the applicant. At present, total fuel oil usage for
the indicated facilities is over 75,000 gallons per year at a fuel oil price of approximately $3.42-
$3.47/gallon, with an additional some 4,542,000 kW/hr of annual electrical usage at a cost of $0.11
per kW/hr.
From the standpoint of the local economy, public facilities are not the highest and best use of
available hydroelectric generation: converting the Aquatic Center’s electrical load to biomass will
free the power up in order to attract potential industrial users to this community.
4.3 Proposed System
Include information necessary to describe the system you are intending to develop and address
potential system design, land ownership, permits, and environmental issues.
4.3.1 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
• Basic integration concept
• Delivery methods
Per the Bear Valley Central Heat Plant concept developed by R&M Engineering – Ketchikan, Inc.,
attached as Exhibit B-3, the project will require boilers able to handle a load totaling 24.87
MMBTu/yr. The design phase of this project will determine the appropriate sizing and controls for
the proposed biomass boiler system to provide lead and lag load heating for each facility, and
determine the extent to which existing fuel oil boilers will remain in operation to cover downtime
and shoulder loads.
4.3.2 Land Ownership
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.
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The property on which this project will be located is already in the Borough’s ownership.
4.3.3 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 discuss potential barriers
Anticipated permits for operation of this facility include a variety of federal, state and local
environmental, construction and land use permits. It is likely that this facility will be below the air
permitting requirements pursuant to Alaska Air Quality Regulations 18-AAC-50, though it is
anticipated an Air Quality Feasibility Study will be required as the design progresses.
Other permits are expected to be required, including EPA construction general permit and NPDES
storm water permit during construction; City of Ketchikan building permit and Ketchikan Gateway
Borough zoning permits; local construction and operating approvals; and Boiler permitting and
boiler operator licenses per Alaska Statutes, Sec. 18.60.210 (a) (9), and Sec. 18.60.395 (b) (2),
respectively.
Additional permitting may be necessary as available funding streams through federal, state or local
grants are pursued. It is not expected that these permitting and regulatory procedures will impact
the overall project schedule or scope.
4.3.4 Environmental
Address 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 discuss other potential barriers
• Threatened or endangered species /Habitat Issues
o No endangered or threatened species will be impacted by the construction of this project.
Per the US Fish and Wildlife Service, the following endangered species are listed and occur in the
State of Alaska:
Short-Tailed Albatross
Polar Bear
Wood Bison
Eskimo Curlew
Spectacled Eider
Stellar’s Eider
Northern Sea Otter
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Stellar Sea Lion
Leatherback Sea Turtle
Beluga Whale
Blue Whale
Bowhead Whale
Finback Whale
Humpback Whale
Sperm Whale.
None of the animals identified above are listed for the Ketchikan Gateway Borough. Most are
associated with coastal marine environments or the northern Alaska Regions, and therefore
outside the range of this project given its location approximately ¾ of a mile inland.
o Biomass will only be purchased from vendors who practice sustainable harvesting
techniques.
• Wetlands and other protected areas
O The Gateway Borough Recreation and Schools Central Heating Plant is intended to be
located on a lot adjacent Schoenbar Creek, an anadromous stream. USACE and ADF&G approval
will likely be necessary during the permitting phase of this project.
O Biomass will only be purchased from vendors who practice sustainable harvesting
techniques.
• Archaeological and historical resources
o Construction will take place within the footprint of existing facility sites that have been
occupied and disturbed for a period in excess of forty years, with the overall site largely disturbed
during construction of the Gateway Aquatic Center in 2013. Given the extensive disturbance and
habitation within recent history, it is unlikely the site retains any aspects of historical significant.
• Land development constraints
o None anticipated
• Telecommunications interference
o None anticipated. Infrastructure will be at height with surrounding buildings.
• Aviation considerations
o None anticipated. Infrastructure will be at height with surrounding buildings.
• Visual and Aesthetic Considerations
o None anticipated. While the site has several highly visible and picturesque structures,
including the Gateway Aquatic Center/Gateway Recreation Center and both schools, there is
sufficient room and available vegetative screening so as to minimize any aesthetic disturbance
resulting from the construction of the Gateway Borough Recreation and Schools Central Heating
Plant.
4.4 Proposed New System Costs and Projected Revenues
(Total Estimated Costs and Projected Revenues)
The level of cost information provided will vary according to the phase of funding requested and
any previous work the applicant may have done on the project. Applicants must reference the
source of their cost data. For example: Applicant’s records or analysis, industry standards,
consultant or manufacturer’s estimates.
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4.4.1 Project Development Cost
Provide detailed project cost information based on your current knowledge and understanding of
the project. Cost information should include the following:
• Total anticipated project cost, and cost for this phase
• Requested grant funding
• Applicant matching funds – loans, capital contributions, in-kind
• Identification of other funding sources
• Projected capital cost of proposed renewable energy system
• Projected development cost of proposed renewable energy system
A detailed economic analysis supporting the costs associated with this project can be found in
Appendix []. A summary of the requested parameters is listed below:
Total anticipated project cost. $ 2,200,000
Cost for this phase: $ 220,000
Requested Grant Funding: $ 220,000
Applicant matching funds – loans, capital contributions , in-kind $ 0
4.4.2 Project Operating and Maintenance Costs
Include anticipated O&M costs for any new facilities constructed and how these would be funded
by the applicant.
(Note: Operational costs are not eligible for grant funds however grantees are required to meet
ongoing reporting requirements for the purpose of recording the impacts of AEA projects on the
communities they serve.)
The Bear Valley Central Heat Plant study prepared by R&M Engineering – Ketchikan, Inc.
estimated that additional O&M costs associated with the Gateway Borough Recreation and
Schools Central Heating Plant will be approximately $4,500/year with 2,203 tons of pellets required
to run the facility, to be offset by savings of approximately 4,314,900 kW/hr and 71,250 gallons of
fuel annually.
It is important to note that the new boilers will replace existing systems. Thus, fuel costs previously
budgeted for the existing system will largely be displaced, and operations and maintenance costs
will be only modestly expanded to reflect requirements of the new system. Moreover, the
anticipated increased costs for O&M represent a significant improvement over the status quo,
given the public benefits to accrue locally from the use of biomass rather than fuel oil.
4.4.3 Heating Purchase/Sale
The heat purchase/sale information should include the following:
• Identification of potential energy buyer(s)/customer(s)
• Potential heat purchase/sales price - at a minimum indicate a price range
• Proposed rate of return from grant-funded project
The proposed project does not anticipated selling heat on the open market. It is intended to offset
present use of heating oil for boilers within the intended recipients and electrical usage at the
Gateway Aquatic Center for heating the facility. At present, total fuel oil usage within these facilities
has been calculated to be 75,000 Gallons per year, with a fuel price of approximately $3.42-
$3.47/gallon of fuel oil, and electrical usage is approximately 4,542,000 kW/hr annually, at a rate of
$0.11 per kW/hr.
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4.4.4 Project Cost Worksheet
Complete the cost worksheet form which provides summary information that will be considered in
evaluating the project.
Please fill out the form provided below and provide most recent heating fuel invoice that supports
the amount identified in “Project Benefits” subpart b below.
Renewable Energy Source
The Applicant should demonstrate that the renewable energy resource is available on a
sustainable basis.
Annual average wood pellets available are in excess of the 2,203 tons/year required for the
proposed system at the Gateway Borough Recreation and Schools Central Heating Plant Design.
Unit depends on project type (e.g. windspeed, hydropower output, biomass fuel)
Existing Energy Generation and Usage
a) Basic configuration (if system is part of the Railbelt 1 grid, leave this section blank)
i. Number of generators/boilers/other ● Schoenbar Middle School: (2) oil-fired boilers
(1.358 MBH each), installed in 2004 (approx..),
66% efficiency (Per Heating System Retrofit
Analysis by Alaska Energy Engineering, LLC)
● Gateway Recreation Center: (2) Weil
McLain/788 oil-fired boilers (1,632 MBH each),
installed 1995 (Per Sheet M.01 of the Indoor
Recreation Center planset by Kumin Associates,
Inc.)
● Gateway Aquatic Center: (2) 520 kW/hr
electric boilers, (1) 1,700 MBH fuel oil boiler,
installed 2012, 96% efficiency, also used for
heating the pools (Identified as Base Case -
Alternative #2 per Ketchikan Aquatic Center
Alternative Energy Study by AMC Engineers)
● Ketchikan Gateway Borough School District
Maintenance Facility: (1) oil-fired boiler (417
MBH) and high temperature distribution system
(300 MBH), installed 1988, 68%, (Per Heating
System Retrofit Analysis by Alaska Energy
Engineering, LLC)
● Valley Park School: (3) oil-fired boilers in a
MacLaine 478 (400 MBH) and two WM 588’s (1084
MBH) operated in a primary-secondary-tertiary
arrangement, installed in 2001, 68% efficiency (Per
Heating System Retrofit Analysis by Alaska
Energy Engineering, LLC)
ii. Rated capacity of generators/boilers/other
iii. Generator/boilers/other type
iv. Age of generators/boilers/other
v. Efficiency of generators/boilers/other
b) Annual O&M cost (if system is part of the Railbelt grid, leave this section blank)
i. Annual O&M cost for labor $16,940
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.
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ii. Annual O&M cost for non-labor $779,570 (electricity and fuel oil)
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] 0
ii. Fuel usage
Diesel [gal] 0
Other 0
iii. Peak Load 0
iv. Average Load 0
v. Minimum Load 0
vi. Efficiency 0
vii. Future trends 0
d) Annual heating fuel usage (fill in as applicable)
i. Diesel [gal or MMBtu] 75,000
ii. Electricity [kWh] 4,542,000
iii. Propane [gal or MMBtu] 0
iv. Coal [tons or MMBtu] 0
v. Wood [cords, green tons, dry tons] 0
vi. Other 0
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]
Woody Biomass Pellets
b) Proposed annual electricity or heat production (fill in as applicable)
i. Electricity [kWh] 227,100 kwh
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]
2,203 tons
iv. Other 3,750 gallons of fuel oil
227,100 kw/hr
Project Cost
a) Total capital cost of new system $2,200,000
b) Development cost
c) Annual O&M cost of new system $ 4,500
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d) Annual fuel cost $ 56,257
Project Benefits
a) Amount of fuel displaced for
i. Electricity
ii. Heat 71,250 gallons fuel; 4,314,900 kw/hr
iii. Transportation
b) Current price of displaced fuel $ 3.42 - $3.47; $0.11 per kW/hr
c) Other economic benefits The Borough will become the base for a sustainable
secondary wood product industry by purchasing
pellets for the boiler systems.
d) Alaska public benefits Per the pre-feasibility assessment and the Southeast
Alaska IRP, the public benefit will be the ability to
avoid switching to electric heat for lead or secondary
heat generation, thereby freeing up that usage for
industrial activities that benefit all Alaskans, including
active shipbuilding and potential mining
developments in the area.
Heat Purchase/Sales Price
a) Price for heat purchase/sale N/A
Project Analysis
a) Basic Economic Analysis
Project benefit/cost ratio 3.23
Payback (years)
4.4.5 Impact on Rates
Please address the following items related to the proposed location of the heating project. If more
than one building will be impacted, please address this information for each building.
1. Building name
Schoenbar Middle School
• Type or primary usage of the building
School
• Location
217 Schoenbar Road
• Hours of operation
7:50am – 2:38pm, with frequent occupancy on weekends and after hours
• Single structure or multiple units
Single structure
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• Total square footage
62,500 s.f.
• Electrical consumption per year
7,007 kWh
• Heating oil/fuel consumption per year
20,870
• Average number of occupants
298 students + 20 staff
• Has an energy audit been performed? When? Please provide a copy of the energy audit, if
applicable.
No. Please note that the Ketchikan Gateway Borough is currently in the process of
soliciting Requests for Proposals from firms providing Energy Savings Company (ESCO)
services, at which point an energy audit will be performed for all of the Borough’s Facilities,
including the schools.
• Have building thermal energy efficiency upgrades been completed?
o If applicable, please provide evidence of efficiency improvements including cost and
anticipated savings associated with upgrades.
Schoenbar Middle School was thoroughly reconstructed in 2003-2006, at which time the
walls and roof were insulated to meet the 2000 International Building Code, with modern
efficient windows throughout. Savings were not calculated at that time.
o Estimated annual heating fuel savings
Per the Ketchikan Bear Valley Central Heat Plant design by R&M Engineering – Ketchikan,
Inc., Schoenbar would see an annual heating fuel savings of $16,000. See Exhibit B-3.
• If the building is not yet constructed please provide evidence of the value of planned
building envelope efficiency investments beyond typical construction practices. Include
anticipated savings associated with efficiency investments if available.
N/A
2. Building name
Ketchikan Gateway Borough School District Maintenance Facility
• Type or primary usage of the building
Shop/Warehouse/Offices/Storage
• Location
333 Schoenbar Road
• Hours of operation
7:00 am – 5:00 pm Monday – Friday (winter) with weekend work standard during the
summer
• Single structure or multiple units
Single structure
• Total square footage
11,140
• Electrical consumption per year
1,545 kWh
• Heating oil/fuel consumption per year
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3,927 gallon
• Average number of occupants
20
• Has an energy audit been performed? When? Please provide a copy of the energy audit, if
applicable.
No. Please note that the Ketchikan Gateway Borough is currently in the process of
soliciting Requests for Proposals from firms providing Energy Savings Company (ESCO)
services, at which point an energy audit will be performed for all of the Borough’s Facilities,
including the schools.
• Have building thermal energy efficiency upgrades been completed?
o If applicable, please provide evidence of efficiency improvements including cost and
anticipated savings associated with upgrades.
No.
o Estimated annual heating fuel savings
$6,169
• If the building is not yet constructed please provide evidence of the value of planned
building envelope efficiency investments beyond typical construction practices. Include
anticipated savings associated with efficiency investments if available.
N/A
3. Building name
Valley Park School
• Type or primary usage of the building
School
• Location
410 Schoenbar Road
• Hours of operation
8:00 am – 4:30 pm Monday - Friday
• Single structure or multiple units
Single Structure
• Total square footage
40,686 s.f.
• Electrical consumption per year
7,641 kWh
• Heating oil/fuel consumption per year
17,233 gallons
• Average number of occupants
322 students + 37 staff
• Has an energy audit been performed? When? Please provide a copy of the energy audit, if
applicable.
No. Please note that the Ketchikan Gateway Borough is currently in the process of
soliciting Requests for Proposals from firms providing Energy Savings Company (ESCO)
services, at which point an energy audit will be performed for all of the Borough’s Facilities,
including the schools.
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• Have building thermal energy efficiency upgrades been completed?
a. If applicable, please provide evidence of efficiency improvements including cost and
anticipated savings associated with upgrades.
In 2013, the Ketchikan Gateway Borough School District replaced Valley Park’s roof with 6”
of rigid insulation throughout the roof. No savings have been calculated.
b. Estimated annual heating fuel savings
$20,000
• If the building is not yet constructed please provide evidence of the value of planned
building envelope efficiency investments beyond typical construction practices. Include
anticipated savings associated with efficiency investments if available.
N/A
4. Building name
Gateway Aquatic Center/Gateway Recreation Center
• Type or primary usage of the building
Swimming Pool
• Location
601 Schoenbar Road
• Hours of operation
5:00am – 8:00 pm, Monday – Friday; 7:00 am – 6:00 pm, Saturday; 12:00 pm – 6:00 pm
Sunday.
• Single structure or multiple units
Ganged to Aquatic Center
• Total square footage
77,477 s.f.
• Electrical consumption per year
2,739,707 kWh
• Heating oil/fuel consumption per year
158,846 gallons;
• Average number of occupants
In 2013, the Recreation/Aquatic Center averaged approximately 227 participants per week,
though the occupant load of the structure swings widely depending on the intensity of
activity and time of day.
• Has an energy audit been performed? When? Please provide a copy of the energy audit, if
applicable.
No. Please note that the Ketchikan Gateway Borough is currently in the process of
soliciting Requests for Proposals from firms providing Energy Savings Company (ESCO)
services, at which point an energy audit will be performed for all of the Borough’s Facilities,
including the schools.
• Have building thermal energy efficiency upgrades been completed?
a. If applicable, please provide evidence of efficiency improvements including cost and
anticipated savings associated with upgrades.
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Grant Application – Heat Projects
No, save that the Aquatic Center (approximately half of the overall building) was
constructed in 2011 under the requirement to meet the requirements of the 2006
International Building Code.
b. Estimated annual heating fuel savings
2,685,803 kWh and 198,159 gallons of fuel: total savings calculated to $242,763.
• If the building is not yet constructed please provide evidence of the value of planned
building envelope efficiency investments beyond typical construction practices. Include
anticipated savings associated with efficiency investments if available.
N/A
SECTION 5– PROJECT BENEFIT
Explain the economic and public 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:
• Potential annual fuel displacement (gallons and dollars) over the lifetime of the evaluated
renewable energy project. In order for the applicant to receive credit for heating fuel
displaced the applicant must provide the most recent invoice for heating fuel purchased.
• Anticipated annual revenue (based on i.e. a Proposed Heat Purchase Agreement price, RCA
tariff, or cost based rate)
• Potential additional annual incentives (i.e. tax credits)
• Potential additional annual revenue streams (i.e. green tag sales or other renewable energy
subsidies or programs that might be available)
• Discuss the non-economic public benefits to Alaskans over the lifetime of the project
Bioenergy facility construction produces multiple positive effects for a region or locality in which the
facility is built.
Firstly, it will displace the use of heating oil in the project’s effected area. Over a 20 year lifespan,
the proposed system would displace over 1.45 Million gallons of diesel fuel and 82 MW/hr in
electricity. Per the attached cost benefit analysis, including plant replacement costs, the Borough
is anticipated to save some $4-million over the next twenty years if implemented.
Engineering and construction jobs will also be created during plant construction, and jobs for
personnel to manage and operate the facility are also created. Indirect jobs and industries also
benefit from the feedstock and other supply materials logistical requirements of the facility. The
facility support impacts spread further and affect more industries than the facility itself. Known as
multipliers, these effects are often far greater than the direct production of the facility.
Ketchikan Gateway Borough will give local construction contractors preferential bidding status
through the design process, to provide specific local building code and design conditions
experience to the team. This will locally distribute funding dollars throughout the project. A number
of qualified firms are available to provide construction contracting services to the project through
the construction phase.
Upon completion, the project is expected to create several direct full time positions for each facility
in the form of qualified boiler operators. Additional job creation benefits will spread far into the
community, including local pellet fuel providers, forest industry, civil and electrical facility
maintenance services, and other local industries. A region-wide expansion to pellet fuel heat can
produce cost savings on the order of $2.1 billion in cumulative net worth over a 50-yr period while
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increasing job opportunities and reinvesting capital directly into the community. Per the McDowell
Group, for every 5 positions directly created through new economic activity, an additional 1.15
indirect positions will also be created. As the Borough’s intention is to become the anchor client for
a local pellet production industry, the vast majority of the economic activity generated will be within
the community.
Finally, a wood pellet boiler system has significant positive benefits relative to greenhouse gas and
CO2 emissions. First, conceptually, biomass heat is a “cleaner” source of energy, as the carbons
storage utilized for heating is being restored on a continual basis, as opposed to fossil fuels, in
which case the carbon storage is effectively removed for all time. Moreover, Ketchikan is located
amidst a myriad of potential biomass sources, such as longstanding logging operations on Prince
of Wales Island, occasional resource extraction projects from the USFS and State of Alaska, and
local site development and the resultant wood waste byproducts. All petroleum fuel sources are
required to be shipped to southeast Alaska, requiring a significant carbon footprint on top of their
development cost. The removal of wood wastes from clearcut areas may also promote the
regrowth of logged areas as a sustainable long-term source of wood resources and fuel.
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SECTION 6– SUSTAINABILITY
Discuss the operation of the completed project so that it will be sustainable.
Include at a minimum:
• Proposed business structure(s) and concepts that may be considered.
• How the maintenance and operations of the completed project will be financed for the life of the
project
• Identification of operational issues that could arise.
• A description of operational costs including on-going support for any back-up or existing
systems that may be require to continue operation
• Commitment to reporting the savings and benefits
Proposed business structure:
• Gateway Borough Recreation and Schools Central Heating Plant will not require a
complicated business structure, as the resources for this project are entirely within the ownership
of the Borough. The Borough does not intend to sell heat, so billing and business structures and
reimbursements will not be necessary. All supplies and contractual services purchased during this
project and through the subsequent operation will be per the Ketchikan Gateway Borough’s
procurement procedures.
How you propose to finance the maintenance and operations for the life of the project:
• Maintenance and operations of the Gateway Borough Recreation and Schools Central
Heating Plant will be financed through a combination of regular budgeting by the Ketchikan
Gateway Borough and through the School District’s regular budgetary process, in which funds
come from the State of Alaska Department of Education and Early Development to be matched by
local funds.
Operational Costs:
• Wood pellet acquisition will be borne by the applicant comparable to the procurement
currently in place for fuel for the diesel boiler systems. Preliminary statements from local vendors
indicate the material may be purchased from local suppliers at a rate of $300/ton of pellets for a
period of five years.
Operational issues:
• A period of adjustment during which the maintenance staff familiarize themselves with the
wood pellet boiler system is anticipated. In advance of that period, the administrative staff have
been examining comparable systems, both locally and within the northwest, and consulted with
energy engineers to identify known operational issues (i.e. clinkers, boiler load requirements, etc.)
in order to minimize frustration during startup.
Commitment to reporting the savings and benefits:
• The Ketchikan Gateway Borough and Ketchikan Gateway Borough School District are
committed to tracking costs associated with the use of the biomass boiler system and any other
economic metrics determined necessary by AEA to determine the impacts resulting from use of the
wood pellet boiler system. In addition, as determined necessary, Staff are committed to providing
operational data to AEA for use in studying the viability of wood biomass projects in Southeast
Alaska.
AEA 15003 Page 27 of 41 7/2/14
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
SECTION 7 – READINESS & COMPLIANCE WITH OTHER GRANTS
Discuss what you have done to prepare for this award and how quickly you intend to proceed with
work once your grant is approved.
Tell us what you may have already accomplished on the project to date and identify other grants
that may have been previously awarded for this project and the degree you have been able to
meet the requirements of previous grants.
Prior to apply for grant funding from AEA, the Ketchikan Gateway Borough has taken multiple
steps to ensure project success. Third party engineering firms have been hired to perform energy
audits for all effected facilities, and to perform feasibility studies regarding construction of the
proposed biomass boilers. In 2013, a Heating System Retrofit Analysis by Alaska Energy
Engineering, LLC was performed on the Ketchikan Gateway Borough’s school facilities, for which
the Ketchikan Gateway Borough School District funded $15,000.
Multiple public bodies have recognized the viability of biomass use in heating as a conservation
measure: in May of 2013, the Borough received $129,210 in grant funding from the USFS Woody
Biomass Utilization Grant; during the Alaska Energy Authority Renewable Energy Fund Round VII
program, the Borough received $620,000; and the legislature awarded a direct legislative grant to
the Borough in the amount of $1,197,500. These have gone to fund the Ketchikan International
Airport and Ketchikan High School Biomass Boiler Projects: design is currently underway, with
additional partial funding from the Ketchikan Gateway Borough and School District.
In-kind participation from the Ketchikan Gateway Borough and Ketchikan Gateway Borough School
District will be provided by staff time necessary to oversee and internally manage the project.
SECTION 8 – LOCAL SUPPORT AND OPPOSITION
Discuss local support and opposition, known or anticipated, for the project. Include letters of
support 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 2,
2014.
Attached letters of support from: David Martin, Assistant Manager for the City of Ketchikan d/b/a
Ketchikan Public Utilities and Robert Boyle, Superintendent of the Ketchikan Gateway Borough
School District.
In addition, the Borough Assembly has supported the creation of a biomass industry in southern
southeast Alaska for many years. Per Resolution 2471-Amended, the Borough Assembly
approved urging the U.S. Forest Service to include “biomass as a use designated by the Land Use
Designation” in the Tongass Land Management Plan. See also Resolution 2505-A, supporting a
prior Renewable Energy Fund Grant, and Resolution 2552, supporting the submittal of the
Renewable Energy Fund Round VIII Grant application.
AEA 15003 Page 28 of 41 7/2/14
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
SECTION 9 – GRANT BUDGET
Tell us how much you are seeking in grant funds. Include any investments to date and funding
sources, how much is being requested in grant funds, and additional investments you will make as
an applicant.
9.1 Funding sources and Financial Commitment
Provide a narrative summary regarding funding source and your financial commitment to the
project
Ketchikan Gateway Borough is requesting $220,000 to support its efforts to develop biomass
energy projects for heating Schoenbar, the Recreation/Aquatic Center, Valley Park and the
Maintenance Facility. Significant funds have already been expended in evaluating the feasibility of
this project. Funding in this request will be used for fund both the Phase II and Phase III work.
9.2 Cost Estimate for Metering Equipment
Please provide a short narrative, and cost estimate, identifying the metering equipment, and its
related use to comply with the operations reporting requirement identified in Section 3.15 of the
Request for Applications.
AEA 15003 Page 29 of 41 7/2/14
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
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 and Commissioning). Please use the tables provided
below to detail your proposed project’s budget. Be sure to use one table for each phase of your
project.
If you have any question regarding how to prepare these tables or if you need assistance preparing
the application please feel free to contact AEA at 907-771-3031 or by emailing the Grants
Administrator, Shawn Calfa, at scalfa@aidea.org.
Milestone or Task
Anticipated
Completion
Date
RE- Fund
Grant Funds
Grantee
Matching
Funds
Source of
Matching
Funds:
Cash/In-
kind/Federal
Grants/Other
State
Grants/Other
TOTALS
Phase II: Feasibility and
Conceptual Design 12/1/2015 $ 40,000 $0 N/A $ 40,000
TOTALS $ 40,000 $0 $ 40,000
Budget Categories:
Direct Labor & Benefits $ $ $
Travel & Per Diem $ $ $
Equipment $ $ $
Materials & Supplies $ $ $
Contractual Services $ $ $ 40,000
Construction Services $ $ $
Other $ $ $
TOTALS $ $ $ 40,000
Milestone or Task
Anticipated
Completion
Date
RE- Fund
Grant Funds
Grantee
Matching
Funds
Source of
Matching
Funds:
Cash/In-
kind/Federal
Grants/Other
State
Grants/Other
TOTALS
Phase III: Final Design and
Permitting 5/1/2016 $180,000 $0 N/A $180,000
TOTALS $180,000 $0 $180,000
Budget Categories:
Direct Labor & Benefits $ $ $
Travel & Per Diem $ $ $
Equipment $ $ $
Materials & Supplies $ $ $
Contractual Services $ $ $180,000
Construction Services $ $ $
Other $ $ $
TOTALS $ $ $180,000
Cost for project phases and milestones are approximate and based on projects of comparable size
and scope currently underway by the Ketchikan Gateway Borough.
AEA 15003 Page 30 of 41 7/2/14
II SECTION 10 -AUTHORIZED SIGNERS FORM
Community/Grantee Name: Ketchikan Gateway Borough
Regular Election is held: First Tuesday in October I Date:
I Authorized GranfSigner(s):
Printed Name Title Term Signature 1 " -,,, I
Dan Bockhorst Borough Manager N/A J/ )AA1-(;{rJ/Jlt1~H J . -~ -
I authorize the above person(s) to sign Grant Documents:
(Highest ranking organization/community/municipal official)
Printed Name Title Term Signature
Dan Bockhorst Borough Manager Per au~ Borough
Resolution
2552
[ Grantee contacflntcfrmation: . . I
Mailing Address: 1900 First Ave., Ste. 210
Ketchikan, AK 99901
Phone Number: (907) 228-6625
Fax Number: (907) 228-6684
E-mail Address: danb@kgbak.us or amyb@kgbal<.us
Federal Tax ID #: 92-0084626
Please submit an updated form whenever there is a change to the above information.
AEA 15003 Page 31of41 7/2/14
SECTION 11 -ADDITIONAL DOCUMENTAl"ION AND CERTIFICATION .·
A.
B.
c.
D.
SUBMIT THE FOLLOWING DOCUMENTS WITH YOUR APPLICATION:.
Contact information and resumes of Applicant's Project Manager, Project
Accountant(s), key staff, partners, consultants, and suppliers per application form
Section 3.1, 3.4 and 3.6.
Applicants are asked to provide resumes submitted with applications in separate electronic
documents if the individuals do not want their resumes posted to the project web site.
Letters or resolutions demonstrating local support per application form Section 8.
For heat projects only: Most recent invoice demonstrating the cost of heating fuel for
the building(s) impacted by the project.
Governing Body Resolution or other formal action taken by the applicant's governing
body or management per RFA Section 1.4 that:
Commits the organization to provide the matching resources for project at the
match amounts indicated in the application.
Authorizes the individual who signs the application has the authority to commit
the organization to the obligations under the grant.
Provides as point of contact to represent the applicant for purposes of this
application.
Certifies the applicant is in compliance with applicable federal, state, and local,
laws including existing credit and federal tax obligations.
E. An electronic version of the entire application on CD or other electronic media, per
RFA Section 1.7.
F. CERTIFICATION
The undersigned certifies that this application for a renewable energy grant is truthful
and correct, and that the applicant is in compliance with, and will continue to comply
with, all federal and state laws including existing credit and federal tax obligations and
that they can indeed commit the entity to these obligations.
Print Name Dan Bockhorst
Signature
Title Borough Manager
Date September 22, 2014
AEA 15003 Page 32 of 41 7/2/14
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
EXHIBIT A-1:
Contact Information:
Owner:
Ketchikan Gateway Borough
1900 First Ave.
Ketchikan, AK 99901
• Borough Manager: Dan Bockhorst, danb@kgbak.us, (907) 228-6641
• Assistant Borough Manager: Cynna Gubatayo, cynnag@kgbak.us, (907) 228-6633
• Project Manager: Ed Schofield – Public Works Director, eds@kgbak.us, (907) 228-6664
• Finance Director: Mike Houts, mikeh@kgbak.us, (907) 228-6649
• Controller: Maureen Crosby, maureenc@kgbak.us, (907) 228-6624
• Administrative Personnel: Amy Briggs – Administrative Assistant II, amyb@kgbak.us, (907)
228-6637
Operator:
Ketchikan Gateway Borough School District
333 Schoenbar Road
Ketchikan, AK 99901
• School District Superintendent: Robert Boyle, Robert.Boyle@kgbaksd.org, (907) 225-2118
• School District Maintenance: Mike Williams, Department
Head, Mike.Williams@kgbaksd.org, (907) 225-2416
Pellet Supplier (Proposed):
Tongass Forest Enterprises
ATTN: Trevor Sande
355 Carlanna Lake Road, Suite 100
Ketchikan, AK 99901
info@akforestenterprises.com
(907) 225-4541
AEA 15003 Page 33 of 41 7/2/14
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
EXHIBIT B-1:
• Letters of support:
o Robert Boyle, Superintendent, Ketchikan Gateway Borough School District
o David Martin, Assistant General Manager, City of Ketchikan d/b/a Ketchikan Public
Utilities
AEA 15003 Page 35 of 41 7/2/14
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
EXHIBIT B-2:
• Resolution 2470 – authorization the application for and acceptance of a grant from the U.S.
Department of Agriculture, Forest Service, State and Private Forestry, for wood energy
projects that require engineering services.
• Resolution 2471 – comments on the U.S. Forest Service Five Year review of its 2008
Tongass Land and Resource Management Plan
• Resolution 2505-Amended – authorization the application for and of a grant from AEA for
construction of wood energy projects at the Ketchikan International Airport and Ketchikan
High School
AEA 15003 Page 36 of 41 7/2/14
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
EXHIBIT B-3:
Bear Valley Central Heat Plant, conceptual design and cost/benefit analysis by R&M Engineering –
Ketchikan, Inc. dated January 31, 2012
AEA 15003 Page 37 of 41 7/2/14
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
EXHIBIT B-4:
Price Proposal from Tongass Forest Enterprises – dated April 23, 2012
AEA 15003 Page 38 of 41 7/2/14
355 Carlanna Lake Road, Suite 100 • Ketchikan, AK 99901
Phone (907) 225-4541 • Fax (907) 220-0645 • info@akforestenterprises.com
April 23, 2012
Mr. Dan Bockhorst
Ketchikan Gateway Borough
1900 First Avenue, Suite 201
Ketchikan, AK 99901
Re: Wood Pellet Supply Contracts
Dear Mr. Bockhorst,
The purpose of this letter is to let potential customers know that there is a
tremendous opportunity for Tongass Forest Enterprises to secure a long term
supply of fiber here on Revillagigedo Island for making pellets. We are in talks with
Alcan Forest Products to purchase the remaining pulp grade wood from the Leask
Lakes sale which is winding down. We are also looking at purchasing much of the
pulp grade wood from the Boundary Sale which is located near the Brown Mountain
Road. The Boundary Sale will likely be the closest timber sale to Ketchikan for
many years to come and offers very inexpensive trucking to Ketchikan. There is
opportunity for future customers to take advantage of this sale by committing to
long term pellet contracts with TFE.
We offer the following pricing of premium grade wood pellets for long term
commitments if agreements are signed by August 2012.
Tons / Year 1 year 2 year 3 year 5 year
0 -200 305 300 295 290
200-500 300 295 290 280
¾ 500 290 285 280 275
Please call if you have any questions with this pricing. (907) 617-1441.
Sincerely
Trevor Sande
cc: Ed Schofield, Mike Williams, Robert Boyle
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
EXHIBIT C: CURRENT CONTRACTUAL FUEL PRICES
Per the attached Agreement for Delivered Heating Fuel and Fuel on a Card Reader System with
Anderes Oil, Inc. at a cost of $0.39/gallon over OPIS for delivered fuel. Also attached is an invoice
from August 18, 2014.
AEA 15003 Page 39 of 41 7/2/14
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
EXHIBIT D: RESOLUTION FROM GOVERNING BODY
Resolution 2552 – authorizing application for and acceptance of a grant from the Alaska Energy
Authority (AEA) for installation of the biomass heating system at Ketchikan High School and pre-
feasibility studies for various other Borough facilities.
AEA 15003 Page 40 of 41 7/2/14
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
EXHIBIT E: FINANCIAL ANALYSIS
Benefit/Cost scenario developed by the Ketchikan Gateway Borough based upon information
provided by R&M Engineering – Ketchikan, Inc. per the Bear Valley Central Heat Plant conceptual
design and economics data provided by Alaska Energy Authority.
AEA 15003 Page 41 of 41 7/2/14
AEA Economic Analysis
Based on AEA Economic Data and R and M Design Study
Renewable Energy Fund Economic Benefit-Cost Analysis Model Updated July 2014 (Alejandra Villalobos Meléndez, ISER Research Associate)
Project Description Comments: (Please assign comment ID and hyperlink next to applicable column/row)
Community ID
Nearest Fuel Community 1
Region 2
RE Technology 3
Project ID 4
Applicant Name 5
Project Title 6
7
Results
NPV Benefits $12,998,200.76
NPV Capital Costs $4,026,499
B/C Ratio 3.23
NPV Net Benefit $4,474,027
Performance Unit Value
Displaced Electricity kWh per year 4,318,000
Displaced Electricity total lifetime kWh 86,360,000
Displaced Petroleum Fuel gallons per year 369,043
Displaced Petroleum Fuel total lifetime gallons 7,380,862
Displaced Natural Gas mmBtu per year -
Displaced Natural Gas total lifetime mmBtu -
Avoided CO2 tonnes per year 3,746
Avoided CO2 total lifetime tonnes 74,916
Proposed System Unit Value
Capital Costs $2,200,000$
Project Start year 2017
Project Life years 20
Displaced Electric kWh per year 4,318,000
Displaced Heat gallons displaced per year 71,250
Displaced Transportation gallons displaced per year -
Renewable Generation O&M $ per kWh -
Electric Capacity kW -
Electric Capacity Factor % -
Heating Capacity Btu/hr 25,170,000
Heating Capacity Factor %95
Total Public Benefit 2013$ (Total over the life of the project)4,497,674
Base System Unit Value
Diesel Generator O&M $ per kWh 0.020$
Applicant's Diesel Generator
Efficiency kWh per gallon
Diesel Generation Efficiency kWh per gallon 14.50
Parameters Unit Value
Heating Fuel Premium $ per gallon 0.47$
Transportation Fuel Premium $ per gallon -$
Discount Rate % per year 3%
Crude Oil $ per barrel EIA Mid
Natural Gas $ per mmBtu
4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26
Annual Cost Savings Units 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 PV
Entered Value Project Capital Cost $ per year -$ -$ 2,200,000$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ 3,973,200$ $4,026,499
Electric Cost Savings $ per year -$ -$ -$ 1,202,203$ 1,207,685$ 1,224,362$ 1,242,838$ 1,263,856$ 1,285,244$ 1,308,030$ 1,329,228$ 1,348,777$ 1,364,973$ 1,385,813$ 1,402,672$ 1,420,621$ 1,435,781$ 1,455,731$ 1,478,315$ 1,500,534$ 1,521,739$ 1,543,023$ 1,563,175$ $18,452,375
Heating Cost Savings $ per year -$ -$ (720,475)$ (425,974)$ (452,273)$ (476,914)$ (502,183)$ (527,940)$ (554,748)$ (582,401)$ (611,658)$ (642,578)$ (675,617)$ (708,909)$ (744,568)$ (781,434)$ (820,489)$ (859,976)$ (900,468)$ (942,745)$ (987,024)$ (1,033,108)$ (1,081,355)$ ($9,951,849)
Transportation Cost Savings $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Entered Value Other Public Benefits $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Total Cost Savings $ per year -$ -$ (720,475)$ 776,229$ 755,411$ 747,448$ 740,655$ 735,916$ 730,497$ 725,629$ 717,570$ 706,198$ 689,356$ 676,904$ 658,104$ 639,187$ 615,293$ 595,755$ 577,847$ 557,790$ 534,715$ 509,916$ 481,820$ $8,500,527
Net Benefit $ per year $0 $0 ($2,920,475)$776,229 $755,411 $747,448 $740,655 $735,916 $730,497 $725,629 $717,570 $706,198 $689,356 $676,904 $658,104 $639,187 $615,293 $595,755 $577,847 $557,790 $534,715 $509,916 ($3,491,380)$4,474,027
Electric Units 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 PV
Renewable Generation kWh per year - - - 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000
Entered Value Renewable Scheduled Repairs $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Renewable O&M $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Entered Value Renewable Fuel Use Quantity (Biomass)green tons - - - - - - - - - - - - - - - - - - - - - - -
Entered Value Renewable Fuel Cost $ per unit -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Total Renewable Fuel Cost $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Proposed Generation Cost $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Fossil Fuel Generation kWh per year - - - 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000 4,318,000
Fuel Price $ per gallon 4.26$ 4.16$ 4.06$ 4.04$ 4.06$ 4.11$ 4.17$ 4.24$ 4.32$ 4.39$ 4.46$ 4.53$ 4.58$ 4.65$ 4.71$ 4.77$ 4.82$ 4.89$ 4.96$ 5.04$ 5.11$ 5.18$ 5.25$
Entered Value Scheduled Repairs $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Entered Value O&M $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Fuel Use gallons per year - - - 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793 297,793
Fuel Cost $ per year -$ -$ -$ 1,202,203$ 1,207,685$ 1,224,362$ 1,242,838$ 1,263,856$ 1,285,244$ 1,308,030$ 1,329,228$ 1,348,777$ 1,364,973$ 1,385,813$ 1,402,672$ 1,420,621$ 1,435,781$ 1,455,731$ 1,478,315$ 1,500,534$ 1,521,739$ 1,543,023$ 1,563,175$ $18,452,375
Base Generation Cost $ per year -$ -$ -$ 1,202,203$ 1,207,685$ 1,224,362$ 1,242,838$ 1,263,856$ 1,285,244$ 1,308,030$ 1,329,228$ 1,348,777$ 1,364,973$ 1,385,813$ 1,402,672$ 1,420,621$ 1,435,781$ 1,455,731$ 1,478,315$ 1,500,534$ 1,521,739$ 1,543,023$ 1,563,175$ $18,452,375
Heating Units 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 PV
Renewable Heat gallons displaced per year - - - 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250
Entered Value Renewable Heat Scheduled Repairs $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Entered Value Renewable Heat O&M $ per year -$ -$ 4,500.00$ 4,635.00$ 4,774.05$ 4,917.27$ 5,064.79$ 5,216.73$ 5,373.24$ 5,534.43$ 5,700.47$ 5,871.48$ 6,047.62$ 6,229.05$ 6,415.92$ 6,608.40$ 6,806.65$ 7,010.85$ 7,221.18$ 7,437.81$ 7,660.95$ 7,890.78$ 8,127.50$ $86,481
Entered Value Renewable Fuel Use Quantity (Biomass)green tons - - 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203 2,203
Entered Value Renewable Fuel Cost $ per unit -$ -$ 325.00$ 337.03$ 349.49$ 362.43$ 375.84$ 389.74$ 404.16$ 419.12$ 434.62$ 450.70$ 467.38$ 484.67$ 502.61$ 521.20$ 540.49$ 560.49$ 581.22$ 602.73$ 625.03$ 648.16$ 672.14$
Total Renewable Fuel Cost $ per year -$ -$ 715,975.00$ 742,466.08$ 769,937.32$ 798,425.00$ 827,966.73$ 858,601.49$ 890,369.75$ 923,313.43$ 957,476.03$ 992,902.64$ 1,029,640.04$ 1,067,736.72$ 1,107,242.98$ 1,148,210.97$ 1,190,694.77$ 1,234,750.48$ 1,280,436.25$ 1,327,812.39$ 1,376,941.45$ 1,427,888.28$ 1,480,720.15$
Proposed Heat Cost $ per year -$ -$ 720,475.00$ 747,101.08$ 774,711.37$ 803,342.27$ 833,031.52$ 863,818.23$ 895,742.99$ 928,847.86$ 963,176.49$ 998,774.12$ 1,035,687.66$ 1,073,965.77$ 1,113,658.90$ 1,154,819.37$ 1,197,501.43$ 1,241,761.33$ 1,287,657.43$ 1,335,250.20$ 1,384,602.40$ 1,435,779.06$ 1,488,847.65$ $14,822,697
Fuel Use gallons per year - - - 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250 71,250
Fuel Cost $ per gallon 4.73$ 4.63$ 4.53$ 4.51$ 4.53$ 4.58$ 4.64$ 4.71$ 4.79$ 4.86$ 4.93$ 5.00$ 5.05$ 5.12$ 5.18$ 5.24$ 5.29$ 5.36$ 5.43$ 5.51$ 5.58$ 5.65$ 5.72$
Entered Value Scheduled Repairs $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Entered Value O&M $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Annual Fuel Cost $ per year -$ -$ -$ 321,126.76$ 322,438.22$ 326,428.34$ 330,848.90$ 335,877.87$ 340,995.16$ 346,446.78$ 351,518.69$ 356,195.90$ 360,070.94$ 365,057.21$ 369,090.81$ 373,385.31$ 377,012.68$ 381,785.76$ 387,189.34$ 392,505.47$ 397,578.84$ 402,671.39$ 407,492.89$ $4,870,849
Base Heating Cost $ per year -$ -$ -$ 321,126.76$ 322,438.22$ 326,428.34$ 330,848.90$ 335,877.87$ 340,995.16$ 346,446.78$ 351,518.69$ 356,195.90$ 360,070.94$ 365,057.21$ 369,090.81$ 373,385.31$ 377,012.68$ 381,785.76$ 387,189.34$ 392,505.47$ 397,578.84$ 402,671.39$ 407,492.89$ $4,870,849
Transportation Units 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 PV
Renewable Transportation Use gallons displaced per year - - - - - - - - - - - - - - - - - - - - - - -
Entered Value Scheduled Repairs ($)$ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Entered Value O&M $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Proposed Transportation Cost $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Transportation Fuel Use gallons per year - - - - - - - - - - - - - - - - - - - - - - -
Transportation Fuel Cost $ per gallon 4.73$ 4.63$ 4.53$ 4.51$ 4.53$ 4.58$ 4.64$ 4.71$ 4.79$ 4.86$ 4.93$ 5.00$ 5.05$ 5.12$ 5.18$ 5.24$ 5.29$ 5.36$ 5.43$ 5.51$ 5.58$ 5.65$ 5.72$
Entered Value Scheduled Repairs ($)$ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Entered Value O&M $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Annual Fuel Cost $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Base Transportation Cost $ per year -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ $0
Proposed
Base
Proposed
Base
Proposed
Base
Biomass 95% of fuel usage to be displaced on a yearly basis. See Bear Valley Central Heat Plant by R&M Engineering - Ketchikan, Inc.
Operations and Maintenance yearly cost of $4,500 and inflation of 3% based upon Bear Valley Central Heat Plant by R&M Engineering - Ketchikan, Inc.
Ketchikan Gateway Borough Biomass inflation of 3.7% per Alaska Energy Engineering, LLC Heating System Retrofit Analysis. R&M calculated at 2% for payback.
Gateway Borough Schools/Recreation Complex Replacement Plant cost based on 3% inflation compounded annually over the twenty year lifespan of the project.
B/C Ration is considered worst case scenario. Alaska Energy Engineerr LLC calculated fuel oil inflation at a rate of 6.6%. R&M Engineering - Ketchikan, Inc. calculated the fuel oil inflation rate at 4%. While the starting value appears high, given the heating fuel premium added onto each gallon spent, the overall fuel inflation per AEA appears to be less than that over the last twenty years. That being said, this provides a
metric by which to measure the remaining assumptions
Ketchikan Gateway Borough Description
Ketchikan
Value given is based on electricity used for heating the facilities. 95% of electrical usage to be displaced on a yearly basis. Primarily this is the swimming pool. See Bear Valley Central Heat Plant by R&M Engineering - Ketchikan, Inc.Rural
Cost to construct based upon Bear Valley Central Heat Plant by R&M Engineering - Ketchikan, Inc.