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HomeMy WebLinkAboutFalse Pass - AEA Round 8 application.small fileRenewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 1 of 46 7/2/14 SECTION 1 – APPLICANT INFORMATION Name (Name of utility, IPP, or government entity submitting proposal) City of False Pass Type of Entity: Fiscal Year End: Government June 30, 2014 Tax ID # 92-0135411 Tax Status: ☐ For-profit ☐ Non-profit X Government (check one) Date of last financial statement audit: City of False Pass does CFS at end of every fiscal year. Last audit was for 2005, and was finished November 21, 2006. Mailing Address: Physical Address: P.O. Box 50 180 Unimak Dr. False Pass, AK 99583-0050 False Pass, Alaska Telephone: Fax: Email: 907-548-2319 907-548-2214 cityoffalsepass@ak.net 1.1 APPLICANT POINT OF CONTACT / GRANTS MANAGER Name: Title: Genetta McLean Ocean Renewable Power Company Grants & Licensing Manager Mailing Address: Ocean Renewable Power Company 120 Exchange Street, Suite 508 Portland, ME 04101 Telephone: Fax: Email: 207-221-0961 207-772-7708 gmclean@orpc.co 1.1.1 APPLICANT ALTERNATE POINTS OF CONTACT Name Telephone: Fax: Email: Chris Emrich 907-548-2319 907-548-2214 cityoffalsepass@ak.net Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 2 of 46 7/2/14 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 X A local government, or ☐ A governmental entity (which includes tribal councils and housing authorities) 1.2 APPLICANT MINIMUM REQUIREMENTS (continued) Please check as appropriate. X 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) X 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) X 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/REFund8.html. (Any exceptions should be clearly noted and submitted with the application.) (Indicate by checking the box) X 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 VIII Grant Application - Standard Form AEA 15003 Page 3 of 46 7/2/14 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. Hydrokinetic Feasibility Study: False Pass, Alaska 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. The Project’s physical location at False Pass, Alaska: 54.853940° North Latitude and -163.408830° West Longitude. (Sec. 34, T061S, R094W, Seward Meridian.) 2.2.2 Community benefiting – Name(s) of the community or communities that will be the beneficiaries of the project. The community that will benefit from this Project: City of False Pass 2.3 PROJECT TYPE Put X in boxes as appropriate 2.3.1 Renewable Resource Type ☐ Wind ☐ Biomass or Biofuels (excluding heat-only) ☐ Hydro, Including Run of River X 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 X Feasibility and Conceptual Design ☐ Construction Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 4 of 46 7/2/14 2.4 PROJECT DESCRIPTION The City of False Pass requests Alaska Energy Authority (AEA) funding in the amount of $428,646 through the Renewable Energy Grant Program (RFA 15003) to complete Phase II Feasibility Analysis and Conceptual Design for the False Pass Tidal Energy Project proposed for the Isanotski Straight. The City of False Pass, like most communities of the Aleutian Islands, has extremely high energy costs and depends completely on diesel fuel to meet their electricity and heating needs. While diesel fuel is currently the most practical option for such communities, it also creates economic, energy security and environmental problems—it has a disproportionately high carbon dioxide (CO2) output compared to other power generation systems—at both local and global levels. The City of False Pass, fortunately, is situated near a significant hydrokinetic (tidal) resource at the Isanotski Straight that offers a potential to significantly reduce, or eliminate, the use of diesel fuel. A significant amount of work has been accomplished for the False Pass Tidal Energy Project, including completion of Phase I Reconnaissance. This Project proposes to build on the completed reconnaissance study and accelerate efforts to develop the False Pass Tidal Energy Project. The Project Team is comprised of the City of False Pass; Aleutian Pribilof Islands Association, Inc. (APIA); Aleutian Pribilof Islands Community Development Association (APICDA); University of Alaska Anchorage (UAA); Benthic GeoScience, Inc.; and Ocean Renewable Power Company, LLC (ORPC). 2.5 PROJECT BENEFIT In Alaska 78,000 people depend on diesel-fired generation to meet 90% of their electrical demand, consuming over 450,000 MWh annually while burning 27 million gallons of diesel fuel.1 This means fuel costs for electricity generation in rural Alaska averages $0.30/kWh. Electricity costs for False Pass, however, are even higher than average at $0.42/kWh for residential and community customers, $0.36 $/kWh for commercial customers.2 Converting even a small portion of this diesel- reliant population to hydrokinetic energy, a completely clean and renewable energy source, would have a significant impact for the people of Alaska. Direct Beneficiary The direct beneficiary of this Project (Phase II) specifically, and the False Pass Tidal Energy Project generally, will be the City of False Pass, which has a population 35 (77% Alaska Native)3 comprised of 21 residential, 11 commercial, 1 federal/state facility and 9 community facilities customers. Here the Project will reduce energy costs and create high-quality jobs, including fabrication/assembly, deployment/installation, and operations/maintenance. Regional Beneficiary The regional beneficiary is Southwest Alaska Municipal Conference (SWAMC), the designated state of Alaska Regional Development Organization (ARDOR) for Southwest Alaska, which includes the Aleutian’s East Borough and the City of False Pass. SWAMC ha s been tasked with expanding public-private partnerships and growing Southwest Alaska based on sound strategic planning efforts. Working in close collaboration with communities and regional organizations, SWAMC develops and updates a Community Economic Development Strategy (CEDS) every five years. The False Pass tidal energy project will address four of the five main goals identified in the 2014-2019 Southwest Alaska CEDS: 1 AEA, Statistical Report of the Power Cost Equalization Program, 2012 2 Wright, B & Worthington, M. DOE False Pass Presentation, 2012 3 U.S. Census 2010 Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 5 of 46 7/2/14 Goal II: Support Access to and Development of Resources Goal III: Infrastructure Improvements Goal IV: Energy Infrastructure that Reduces the Delivered Cost of Power and Increases Regional Efficiency Goal V: Regional Partnerships Specifically, this proposal will address the following Southwest Alaska CEDS objectives: Goal II, Objective 1: (Fisheries Development)-by offsetting diesel consumption of False Pass’ small businesses and fish processing plant with a sustainable supply and stabilized cost of electricity, increasing the competiveness and viability of the community’s core economic driver Goal III, Objective I: (Strategic Infrastructure Investments) -by supporting long term renewable energy infrastructure in the community that will enhance quality of life for residents and spur future population growth Goal IV, Objective II: (Ownership of Energy Systems)-by aiding in the development of a locally owned and operated renewable energy system that is resilient to the cost and supply fluctuations of diesel and GIV, Objective III (Supply of Low Cost Power)-by levelizing the cost of power at a rate below the cost of diesel generated electricity, thereby allowing more energy dollars to be recirculated in the community and investments to stay in-region Goal V, Objective II: (Communications)-by supporting the continued strong team of public and private entities involved in this project that have been leaders in addressing energy challenges and forwarding tidal energy development in rural Alaska. This Project will also address the Southwest Alaska Development Strategy by eliminating the barriers associated with diesel dependency and aiding in an increased quality of life and economic opportunities in False Pass. The jobs created and retained as a result of this project will contribute to wealth retention and long term viability of the community. In addition, there are many other communities throughout the Aleutian Islands, Alaska Peninsula in Southeast Alaska and isolated areas in Northwest Alaska that are dependent on diesel resources and situated adjacent to strong tidal resources which could likely have economic tidal hydrokinetic installations once a project has been demonstrated at False Pass. These include Elfin Cove, Angoon, Hydaburg, Atka, Newtok, and Teller. Environmental Benefits There are also environmental benefits from a tidal energy project, which will displace the use of fossil fuels and result in avoided emissions. By displacing fossil fuels the risk of fuel spills in Alaska’s waterways during transport and storage will also be mitigated. See Section 5 Project Benefit for data on reduction of CO2 emissions. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 6 of 46 7/2/14 2.6 PROJECT BUDGET OVERVIEW The Project will amount to $491,146 with the anticipated sources of funding as follows: (1) $428,646, AEA award and (2) 62,500, in-kind matching funds from APICDA. 2.7 COST AND BENEFIT SUMMARY Include a summary of grant request and your 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 $428,646 2.7.2 Cash match to be provided $0 2.7.3 In-kind match to be provided $62,500 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) $491,146 Other items for consideration 2.7.6 Other grant applications not yet approved USDA Rural Utilities Service, High Energy Cost Grant. Pending 2015 $3,000,000 Project Costs & Benefits (Summary of total project costs including work to date and future cost estimates to get to a fully operational project) 2.7.7 Total Project Cost Summary from Cost Worksheet, Section 4.4.4, including estimates through construction. $6,870,575 2.7.8 Additional Performance Monitoring Equipment not covered by the project but required for the Grant Only applicable to construction phase projects $0 2.7.9 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. $1,854,871 2.7.10 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. $8,200,000 Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 7 of 46 7/2/14 SECTION 3 – PROJECT MANAGEMENT PLAN 3.1 Project Manager The City of False Pass has selected Monty Worthington, Director – Project Development, Alaska, Ocean Renewable Power Company, LLC (ORPC), to be Project Manager: Monty Worthington Director – Project Development, Alaska Ocean Renewable Power Company c/o Professional Growth Systems 911 West 8th Avenue, Suite 205 Anchorage, Alaska 99501 207-772-7707 mworthington@orpc.co (Resume attached) Monty Worthington will serve as Project Manager and will report to the city of False Pass under the direction of Chris Emrich. Mr. Worthington will be responsible for maintaining the quality of work produced by the Project Team. He will oversee and review all milestones and provide supervision on all project phases. He will ensure proper communications with the City of False Pass and AEA. An Assistant Project Manager (new hire TBD) will assist with these efforts. ORPC will provide project management support and all grant, contractual and administrative activities, and will work at the direction of Mr. Worthington and Ms. Salmon. ORPC offers extensive project development and strategic management services, and is staffed by a highly skilled team of professionals with an extended network of top technical and scientific experts. ORPC is pioneering river hydrokinetic power systems for remote off-grid and micro-grid communities. The company has successfully installed, operated, monitored and retrieved the RivGen® Power System, which generated electricity from the Kvichak River and transmitted it to shore at the Village of Igiugig, Alaska. ORPC also provided project development and permitting services to a wave energy demonstration project in Yakutat. Among their prestigious awards, ORPC was named one of the World’s Top 10 Most Innovative Energy Companies by Fast Company in 2013. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 8 of 46 7/2/14 3.2 Project Schedule and Milestones Milestones Tasks Start Date End Date Phase II 1. Project scoping and contractor solicitation completed ADCP expedition planning and procurement completed 7/1/15 8/1/15 2. Detailed resource assessment completed ADCP survey of 3-5 sites completed 8/7/15 11/1/15 3. Identification of land and regulatory issues Initial meetings with project stakeholders and regulatory agencies, desktop environmental literature surveys completed and presented to regulatory agencies 10/1/15 2/1/16 4. Permitting and environmental analysis completed Draft study plans developed and submitted to regulatory agencies 1/1/16 3/1/16 5. Detailed analysis of current cost of energy and future market completed Analysis of current energy costs, anticipated load growth and future energy costs completed 1/1/16 3/1/16 6. Assessment of alternatives Alternative energy generation options analyzed 1/1/16 3/1/16 7. Conceptual design and costs estimate completed Latest cost data incorporated into financial model 11/1/15 1/15/16 8. Detailed economic and financial analyses completed Updated pro forma model developed incorporating ADCP data from survey and UAA modeling effort 1/15/16 3/1/16 9. Additional required field data collected Sub bottom survey completed and data incorporated into conceptual design 5/1/16 6/1/16 10. Conceptual business and operations plan completed Project partners collaborate on business plan for tidal energy project hold stakeholder meeting 3/1/16 7/1/16 11. Final report and recommendations completed Final report submitted to AEA 5/1/16 7/1/16 3.3 Project Resources The False Pass Project Team, described below, has significant experience working together as partners and contractors on various projects. The organizational structure of the Project Team is illustrated in Figure 1. Resumes are attached. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 9 of 46 7/2/14 Figure 1. Project Team Organizational Structure City of False Pass The City of False Pass, located within the boundaries of the Aleutians East Borough, will serve as Business Contact for this Project, under the direction of Chris Emrich, City Clerk. The City is eligible to receive funding through AEA’s grant program, and the False Pass City Council has signed a resolution (15-04) supporting the submittal of this application on September 16, 2014 (see attached Section 11.D.). False Pass has significant marine capacity locally and regionally available for a community of its size. This includes marine assets and expertise of Project Partner APICDA and subsidiary Bearing Pacific Seafoods, Coastal Marine and Western Pioneer Shipping companies, as well as the fleet of fishing vessels that operate and transit through the area. Aleutian Pribilof Islands Association, Inc. (APIA) APIA is a federally recognized tribal organization of the Aleut people in Alaska. It is a nonprofit corporation founded to advance the overall economic, health, social and cultural development of the people within the Aleutian and Pribilof Regions in the State of Alaska. Bruce Wright, Senior Scientist, is a regional leader in energy conservation and alternative energy projects, including onsite weatherization applications. He has managed large state and federally funded projects. Karen Pletnikoff, Community Environment and Safety Manager, has provided environmental technical assistance and project management in rural Alaska for 12 years. She has worked on large federally funded efforts from construction, environmental sampling and site remediation. Aleutian Pribilof Islands Community Development Association (APICDA) APICDA is a 501(c)(3) nonprofit organization incorporated in the State of Alaska to develop the commercial and sport fishing industry for the long-term social and economic viability of communities in the Bering Sea and Aleutian Islands. It is one of several Aleut Region organizations working to reduce dependence on fossil fuels by exploring alternate energy resources. APICDA will provide $77,820 in cost match for vessels, captains, and room and board for field work (Letter of Verification: Section 11 B). Angel Drobnica is the Renewable Energy and Fisheries Liaison for APICDA and has been working on energy planning and projects in diesel dependent communities throughout Alaska for the past three years. She will be helping to coordinate vessel and ground support for this project. City of False Pass ORPC - Project Manager Consultants and Contractors APIA APICDA Benthic GeoScience UAA Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 10 of 46 7/2/14 University of Alaska Anchorage (UAA) UAA under the leadership of Prof. Tom Ravens, Ph.D., Dr. Ravens has 20 years of research experience in the areas of coastal hydrodynamics and sediment transport, flume testing, and renewable energy assessment. In the past 10 years, he has supervised $2 million of research projects funded by NOAA, AEA, U.S. Department of Energy (DOE) (through the Electronic Power Research Institute), and others. Dr. Ravens has played a leading role in two hydrokinetic assessment projects for the State of the Alaska and for the contiguous United States. UAA will continue the development of a 3D, high-resolution model of circulation and turbulence in False Pass using Delft3D software. We will calibrate and validate the model using velocity, water level, and turbulence data collected using two ADCP’s that were deployed in the summer of 2012. Once the model is performing satisfactorily, we will use the model to produce plots showing the spatial distribution of power density and turbulence. Using these plots, and after consulting with team members, we will propose the locations of 5 ADCPs (and two ADVs) scheduled to be deployed in the summer of 2014. After the 2014 field season, the model will then be validated using the ADCP and ADV data. Adjustments to the model will be made as necessary and following consultation with the team. The model will be used for any additional computations required by the team during the course of the project. Benthic GeoScience, Inc. Benthic GeoScience provides professional geophysical and hydrographic surveying services throughout the world. Strong geophysical and oceanographic staff complements their technical surveying services for renewable energy project planning. David Oliver, Director of Operations, is a geophysicist with more than 25 years in the geotechnical industry and 14 years working directly with the marine geophysical industry. He established Benthic GeoScience, Inc. after serving the renewable energy community for many years. David has lead the Site Characterization and Resources Assessment work on many marine and riverine hydrokinetic projects in Alaska, including Ruby, Eagle, Nenana, Igiugig, and ORPC’s tidal energy sites. David is a member of the following organizations: Renewable Energy Alaska Project (member of the Policy and Rural Community Energy Committees) for five years, Alaska Hydrokinetic Energy Research Center Advisory Board, AEA Hydrokinetic Working Group, and shadow committee for ANSI TC-114’s Tidal Resource Assessment Project Team representing U.S. interests as international standards for Renewable Energy Resource Assessment are being established by the International Electrotechnical Commission. David strives to stay abreast of the dynamic oceanographic, geophysical, and hydrographic industry advancements to continuously match the appropriate technologies to the marine renewable industry. In particular, Benthic has worked to downscale the size, weight, and cost requirements of operations in remote Alaska without sacrificing quality. Ocean Renewable Power Company, LLC (ORPC) ORPC brings tidal energy technology and project management expertise to the Project. ORPC is a global leader in hydrokinetic technology and project development. With corporate headquarters in Portland, Maine, ORPC develops hydrokinetic power systems and eco-conscious projects that harness the power of oceans and rivers to create clean, predictable renewable energy. ORPC works in partnership with coastal and river communities to create and sustain local jobs while promoting energy independence and protecting the environment. In 2012 ORPC made history by starting operation of the Cobscook Bay Tidal Energy Project, the first commercial, grid-connected hydrokinetic tidal energy project in North America. Located at the mouth of the Bay of Fundy near Eastport and Lubec, Maine, this is the only ocean energy project, Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 11 of 46 7/2/14 other than one using a dam, which delivers power to a utility grid anywhere in the Americas. The TidGen™ Power System is connected to the Bangor Hydro Electric utility grid at an on-shore station in North Lubec. The Project received a Federal Energy Regulatory Commission pilot project license and the first Maine Department of Environmental Protection General Permit issued for a tidal energy project. In addition, ORPC received approval for the first power purchase agreement for tidal energy from the Maine Public Utilities Commission. ORPC has been developing and licensing projects at world-class tidal energy sites in North America’s most robust tidal energy resources: the Bay of Fundy, and Cook Inlet, Alaska. These project sites have the potential to generate more than 300 megawatts of electricity—enough to power roughly a quarter of a million homes. The development of ORPC’s power systems and projects is also creating substantial job growth and other economic opportunities, while helping to reduce the nation’s reliance on foreign oil. ORPC’s letter of support is attached in Section 11.B. Christopher R. Sauer, P.E.—President & CEO Mr. Sauer provides overall management and leadership in all of ORPC’s technical and commercial activities. Mr. Sauer is a professional engineer, energy entrepreneur, and strategic development consultant with more than 40 years of experience in executive management, engineering, construction, project development, marketing, financing, and startup company formation in the electricity, cogeneration, renewable energy and energy efficiency industries. Involved in the energy transaction business since 1977, Mr. Sauer has played an instrumental role in the development of more than $2 billion in energy assets and companies. Mr. Sauer is a founding member of ORPC. Brenda LeMay—Vice President of Finance and Administrations and CFO Ms. LeMay manages all financial and administrative matters for ORPC. She has more than 15 years of development experience in the energy industry, including negotiating commercial transactions, permitting, structuring policy, financial analysis and management. Most recently Ms. LeMay held senior management positions at EDP Renewables, the third largest wind energy company in the world, where she was responsible for energy management across Europe and project development throughout the Pacific Southwest Region of the United States. Jarlath McEntee, P.E.—Vice President of Engineering and CTO Mr. McEntee leads the development of the company’s proprietary hydrokinetic energy technology. He earned his Bachelor of Engineering in Mechanical Engineering at University College in Dublin, Ireland in 1986 and his Master of Science at Dartmouth College in 1989. He comes to ORPC after spending more than 25 years in engineering and project management, having developed technical expertise in tidal power turbines, combined heat and power systems, Stirling engine and refrigeration systems, control system design and analysis, micro-mechanical structures, and marine engineering systems. Mr. McEntee has taught courses in engineering at the Maine Maritime Academy, holds multiple engineering-related patents, and has submitted numerous patents on behalf of ORPC. He is a registered Professional Engineer in the state of Maine. John Ferland—Vice President of Project Development Mr. Ferland leads ORPC’s project development, environmental permitting and project licensing activities, as well as subsidiary companies focused on international business development and providing strategic and tactical expertise and support to other ocean energy developers and related parties. He draws on over 30 years of experience encompassing technology commercialization, renewable energy development, port emergency response operations and coastal resources management. He has served as CEO of an oil spill response company, mentored numerous startups as director of a technology entrepreneur assistance program, and was the founding Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 12 of 46 7/2/14 president of the Environmental & Energy Technology Council of Maine, now the leading industry association for clean technology companies in northern New England. Monty Worthington, ORPC Director of Project Development – Alaska, will serve as Project Manager of this Project. He has over ten years of experience designing, implementing, and maintaining renewable energy systems in Alaska, western U.S., and Asia. He assumes oversight of the Project, including managing resource assessment. Ryan Tyler, ORPC Project Engineer, supports the engineering of ORPC's power system. He provides field engineering and project management for the deployment of the RivGen® System in Igiugig, Alaska. A registered Engineer-in-Training in the state of Washington, he has four years experience as a project engineer and researcher in the marine hydrokinetics field, and one-and-a- half years experience as a business strategy consultant. Doug Johnson, ORPC Director of Projects – Alaska, will also assist with this project. Mr. Johnson has over thirty years of project development experience in Alaska, having worked as an investor, a business owner, an entrepreneur, a professional manager and a business consultant. He has developed projects ranging from the launch of Alaska’s first biotech company to the planning and execution of a $2 billion hospital in Abu Dhabi. He is responsible for developing present and future business opportunities for the ORPC in Alaska. Nathan Johnson, ORPC Director of Environmental Affairs, leads ORPC’s site licensing and permitting efforts, developing innovative approaches to federal and state marine hydrokinetic permitting and environmental monitoring. Mr. Johnson has a diverse background that includes marine renewables, solar energy site development, marine and coastal geology, hydrogeology, and construction management. Projects have ranged from marine and coastal projects in New England to determining fluvial geomorphology impacts at solar power projects in the southwestern United States. Genetta McLean, Ph.D., ORPC Grants and Licensing Manager, negotiates with government agencies to secure grants and loans for ORPC technology and project development. She works directly with project management, development, engineering, finance and writing teams to gather and organize materials, prepare reports, conduct analyses and generate budgets. She oversees and contributes to applications for new loans and grants. Dr. McLean also plays a similar role in ORPC’s licensing efforts and is responsible for aspects of licensing or permitting applications, as well as managing the post-licensing and permit periodic report process. 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 Project Manager—Monty Worthington, ORPC—will report to the City of False Pass (Chris Emrich) – the grantee, and the Project Team (City of False Pass, APIA, APICDA, UAA, Benthic GeoScience, and ORPC) on the Project’s performance. All members of the Project Team have an established working relationship with each other as well as with AEA and will continue best efforts to maintain communications. ORPC’s project management practices are geared towards carefully monitoring scope, schedule and budget to ensure the Project is tracking as planned. Any significant changes to any aspect of the Project will be reported promptly to AEA. ORPC will monitor the Project through a detailed Project Management Plan with status and general project management tools. ORPC’s project management practices are geared towards Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 13 of 46 7/2/14 carefully monitoring scope, schedule and budget to ensure the Project is tracking as planned and will include the following: 1. Gantt Chart 2. Risks Log (Failure Mode Effects Analysis-based and is a live document) 3. Milestones Log (will be used for the quarterly reports, and easier to read than the Gantt) 4. Issues Log (major issues impacting schedule, budget and technical objectives, showing action plans and status) 5. Actions Log (an internal tool for overall actions not accounted for in the Gantt or in addition to the Gantt). To ensure that the Project Team and AEA are thoroughly informed on the Project’s progress, ORPC will use the tools created in the Project Management Plan. ORPC will hold weekly meetings with the Project Team to provide updates with the project manager, contractors, and key ORPC personnel, which is the standard procedure for other state and federally projects. All members of the Project Team have an established working relationship with each other on other federal and state funded projects and will continue best efforts to maintain their excellent communications. The Project Manager will submit regular quarterly progress reports to AEA after the City of False Pass’s review and approval. The Project Team will schedule meetings with AEA as necessary or as requested to update AEA on the Project. Any significant changes to any aspect of the Project will be reported promptly to AEA. If the Project falls behind, the Project Team will inform AEA and propose solutions for managing any problems and correcting schedule lapses. Alternative Contact Person Chris Emrich, City Clerk 907-548-2319 cityoffalsepass@ak.net Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 14 of 46 7/2/14 3.5 Project Risk The Project Team has approached the investigation of tidal energy at False Pass with a focus on minimizing project risk. The Project’s reconnaissance phase established the viability of the resource early on in order to rule out the financial risk associated with an unknown resource. Having established the viability of the resource, Project development will continue in a way that minimizes risk through a phased approach. Each phase of the False Pass Tidal Energy Project has risks associated with the successful execution of the scope of work. The primary project risks of this Project are associated with field work. While the deployment and retrieval of scientific equipment in highly energetic tidal environments are challenging, ORPC has significant experience deploying and retrieving equipment in these environments and has successfully completed two month-long deployments in the False Pass area, increasing confidence that this work can be successfully executed. These and any other potential risks will be mitigated by the Project Team, which collectively has extensive experience working on marine technology projects and is committed to proactively managing risk. While the City of False Pass is a remote community, it has the advantage that its marine operations are serviced directly from the Port of Seattle. In comparison to other coastal Alaskan towns that are serviced out of Alaskan ports, False Pass has access to a greater diversity of marine infrastructure and more regular and reliable shipping from an ice free heavily industrialized port. This access increases the reliability of marine services and available resources into a longer field season, and decreases the cost of services. Furthermore, for a community like False Pass, dedicated equipment, such as the retrieval catamaran (Figure 1), will likely be incorporated into the project making the key operations and maintenance equipment proximal to the deployment site year round. Figure 1. Retrieval catamaran used in to raise ORPC’s TidGen® device in Cobscook Bay, Maine The Project Team has identified environmental concerns and the permitting process as risks that need to be managed. While obtaining permits are not perceived to pose a risk to the completion of Phase 2, there are potential environmental concerns that could impact that ability to execute the overall project successfully and economically. The Project Team has already identified the permits and licenses required for this Project and will collect the required permits and licenses An additional project risk is the remote nature of operations in False Pass. While this is again well understood for the level of field operations entailed in the Feasibility phase of the Project, it will be Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 15 of 46 7/2/14 necessary to design the Project so that it can be installed and maintained with equipment and capacity appropriate to False Pass. The Project Team will continue to develop an understanding of this capacity through the execution of the Feasibility Phase. If problems arise, the Project Management Plan (described in Section 3.4) will provide a protocol for addressing them. 3.6 Project Accountant(s) The City of False Pass, the Grantee, will perform the accounting under the direction of Chris Emrich, City Clerk (resume attached). 907-548-2319 cityoffalsepass@ak.net 3.7 Financial Accounting System The City of False Pass uses Quickbooks Pro for all accounting purposes. All expenditures are classed, to differentiate various revenue/expenditures by the various projects/departments. The City Council of False Pass reviews an updated P&L comparison to the budget, at all council meeting and includes bank statements. All expenditures are done with the signature of two council members. 3.8 Financial Management Controls The City Council of False Pass reviews an updated P&L comparison to the budget, at all council meetings and includes bank statements. All expenditures are done with the signature of two council members. Throughout this Project, all expenditures will be cross-referenced with invoices, and will be summarized in the quarterly progress reports. All expenditures will be submitted by the Project Manager and verified by the City Clerk and Mayor. The State of Alaska Department of Commerce, Community and Economic Development’s Division of Community and Regional Affairs conducts a Rural Utility Business Advisor assessment of False Pass, and the report is available online. The City of False Pass also meets 26 of 26 essential indicators per Glen Hamburg, Local Government Specialist. This assessment validates our accounting systems, finances, tax problems, personnel systems, organizational management, and operation of utility. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 16 of 46 7/2/14 SECTION 4 – PROJECT DESCRIPTION AND TASKS 4.1 Proposed Energy Resource Description of Potential Available Energy Resource The City of False Pass is located near a significant hydrokinetic (tidal) resource at the Isanotski Straight (Figure 2), which has a tidal energy resource with an impressive capacity factor in the range of 40-50% of rated capacity. This is the strongest tidal energy resource measured in Alaska, making it an ideal tidal energy project. Figure 2. City of False Pass at the Isanotski Straight Phase 1: Reconnaissance (Completed, 2012) Significant preparation for the False Pass Tidal Energy Project has been completed. In 2008 and 2010, two AEA-funded studies confirmed the need to formally study the area’s potential for tidal power.4 In 2012, a DOE-funded study concluded that “a tidal energy project could be provided to the City of False Pass at a rate at or below the cost of diesel generated electricity and sold to commercial customers at rates competitive with current market rates, providing a stable, flat priced, environmentally sound alternative to the diesel generation currently utilized for energy in the community.” 5 4 2008: Village end use energy efficiency measures program, AEA Grant 2195225. Administered by Alaska Building Science Network. http://www.akenergyauthority.org/EndUseEfficiency/VEUM/07-08_NW-SW - FalsePassFinalReport.pdf). 2010: Renewable Energy Resource Assessment for the Communities of Cold Bay, False Pass, and Nelson Lagoon. Andy Baker and Lee Bolling. April 2010. AEA funded. AEA also provided programmatic funding to support a bathymetric survey that was completed in 2013 as well as additional circulation modeling currently underway at the University of Alaska Anchorage. ORPC performed a reconnaissance tidal current survey to obtain a preliminary assessment of the potential for a tidal energy project as an energy alternative for the City of False 5 Wright, B. (2014). Feasibility of Tidal and Ocean Current Energy in False Pass, Aleutian Islands, Alaska, Final Report, Aleutian Pribilof Islands Association, Inc., U.S. Department of Energy, Renewable Energy Development and Deployment in Indian Country: DE-EE0005624.000 Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 17 of 46 7/2/14 Pass in 2012 (Section 11.G. Attachments), (Figure 3).6 As next steps, prior to construction of a tidal energy system, AEA recommended, but did not fund, the City of False Pass’s request for Phase II Feasibility Study. 7 This Project proposal is a resubmittal of that request. Figure 3. Contour plot of average energy density, flood tide (left). Contour plot of average energy density, ebb tide (right). Source: UAA, Final Report: Hydrokinetic Resource Assessment in False Pass, Alaska, September 4, 2013. Based on ADCP data collected in 2012 at False Pass, ORPC analyzed the anticipated capacity factor of a single TidGen® device at site N2 based on a rated capacity of 200 kW, about ½ mile from the False Pass grid and at site S2, about two miles from the False Pass grid (Figure 4). Table 1 shows the relative capacity factor at these sites. At site S2, the most likely candidate for device placement, an impressive capacity factor of 44.2% can be achieved, and with the added benefit of predictable delivery of this power, its value to the local energy portfolio is high. Table 1 also shows the sites’ anticipated annual generation in kWh. Figure 5 shows a “tidal rose” adapted from a wind rose to show the directionality and magnitude of the tidal current velocities at False Pass. This rose shows robust currents at site S2 that are very symmetrical on the ebb and flood allowing efficient energy capture in both flow directions. 6 ORPC, Reconnaissance Current Survey Report, Prepared for the Aleutian Pribilof Island Association, April 1, 2013 7 False Pass Hydrokinetic Feasibility Study, AEA application no. 1062. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 18 of 46 7/2/14 Figure 4. Deployment locations for ADCPs (AWAC and RDI ADCP) at False Pass Figure 5. Tidal rose image from ADCP data collected at site S2 10 meters above the seafloor, showing high current velocities and symmetric direction on ebb and flood tides. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 19 of 46 7/2/14 Table 1. Annual generation and anticipated capacity factor at two sites near False Pass based on ADCP data collected in 2012 Site N2 10.5 m above seafloor S2 10.7 m above seafloor Annual recoverable energy, 200 kW TidGen® device 94% availability 359,510 kWh 21.6% capacity factor 730,128 kWh 44.2% capacity factor Further investigation of project development considerations and constructability of a tidal energy project in the vicinity of False Pass will be completed during this Project to assess the economics of installing a tidal energy project near one of these sites. Of key importance in this assessment will be incorporating data from a bathymetric survey covering the area of potential device locations and submarine power cable routes, and analysis of technical and cost considerations for a power cable line to connect the project to False Pass. The Project Team has collected this bathymetric data under programmatic hydrokinetic funding from AEA provided to the Southwest Alaska Municipal Conference who contracted Benthic GeoScience to complete this survey with assistance and cost sharing from APICDA who provided a vessel and captains to support the field effort (Figure 6). Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 20 of 46 7/2/14 Figure 6. Bathymetric image from data collected at False Pass in August 2013 The next steps in the feasibility effort of this Project will be to enhance the fidelity of the circulation model developed by UAA by incorporating the bathymetric data into their model domain to allow finer scale resolution. This modeling has also been supported by programmatic hydrokinetic funding provided by AEA and is ongoing. Based on this modeling data, the Project Team will select sites that appear suitable for tidal turbine placement based on both UAA modeling efforts and the bathymetric data in the vicinity of the highest current velocities and any locations that are suggested by the model to have viable current velocities for energy extraction and reasonable transmission distances to the False Pass grid. Three to five of these sites will then be selected for deployment of ADCPs to measure current velocities over a full lunar cycle and for deployment of Acoustic Doppler Velocimeters (ADVs) to measure turbulence. These measurements will help to quantify the amount of extractable energy available from the resource. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 21 of 46 7/2/14 The data collected from this field effort will then be utilized to further enhance UAA circulation model, both through verification of the models accuracy by hindcasting the model to the deployment time period and comparing its output to actual field measurements. The model will also be enhanced to output information on turbulence that will also be validated with the data from field measurements. By incorporating the ADCP data, UAA modeling work, and bathymetric data the project team will be enabled to select viable sites for tidal turbine placement. Having chosen these sites, we will assess the environmental concerns associated with deployment in these areas, conduct outreach with stakeholders to incorporate stakeholder input in the selection of candidate sites, and perform an economic analysis of deployment at the viable locations to identify the optimal site(s) for tidal turbine placement. Pros and Cons of Proposed Energy Resource versus Other Alternatives Circulation modeling conducted by UAA, discussed above, shows False Pass as a premier tidal energy resource, having the strongest tidal energy resource yet investigated by ORPC and stronger than any measured tidal resources in Alaska. This resource, coupled with the proximity to the load at False Pass, makes it an ideal tidal energy project that will serve as a demonstration project for other coastal Alaska applications. The City of False Pass is currently investigating other energy alternatives, including a design for a wind turbine installation. There is uncertainty associated with any of these renewable energy alternatives and the ultimate cost and reliability of the electricity they will produce. At this point the quality of the wind resource is arguably less well defined than the tidal resource. Even if a wind project were installed, the unpredictable energy associated with wind would not make it a replacement for a predictable tidal energy resource. Being predictable, tidal energy would be a dispatchable resource that could be more economically and effectively integrated with the False Pass grid, reducing diesel more significantly than a wind project could. 4.2 Existing Energy System 4.2.1 Basic configuration of Existing Energy System The City of False Pass owns and operates a diesel generation plant for approximately 25 residential customers, 13 commercial customers, 11 community structures, 3 federal/state structures and the harbor. Bering Pacific Seafood, a subsidiary owned by APICDA, owns and operates a separate diesel generation plant for its processing operations. APICDA purchases electricity from the city for its bunk house and for its construction related activities during the non- processing months. Following is information regarding the two power houses (Figure 7): City of False Pass Unit 1: 180 kW John Deere with 10,000 hrs (new install September 2014) Unit 2: 125 kW John Deere with over 44,000 hrs (rebuilt twice) Unit 3: 175 kW John Deere with over 18,000 hrs (will require rebuild soon) Bering Pacific Seafood Unit 1: 365 kW Caterpillar (C-15) with 2412 hrs (new in 2013) Unit 2: 350 kW Caterpillar (3406 B) with 9,388 hrs (reconditioned once) Unit 3: 350 kW Caterpillar (3406 D1) with unknown hrs (reconditioned once) Unit 4: 185 kW Perkins with unknown hrs (not in operation) Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 22 of 46 7/2/14 The City of False Pass strives to operate its generators to adequately carry the City’s loads while balancing efficiency and maintenance costs. In 2012 the City’s generation efficiency was 11.24 kW h per gallon of fuel. In 2012, the City’s line loss averaged 14.7% but has decreased to 6.2% this summer, likely due to valve replacements on its primary generator.8 In 2013, the generation efficiency increased to 13.38 kWh per gallons, possibly due to line loss improvements in 2012. Figure 7. False Pass power plant with 5,000 gal. fuel tank 4.2.2 Existing Energy Resources Used Existing Energy Resources The City of False Pass relies completely on fossil fuels for all of its energy needs. In 2013 the City of False Pass burned 53,153 gallons of fuel to meet the city’s electricity loads. The community uses another approximately 18,000 gallons of fuel for heating. Bering Pacific Seafood is the largest single energy load in the community, almost equaling the total combined community load. The plant’s production and associated energy needs have 8 The existing energy system was described in detail by Marsh Creek, “False Pass Kinetic Hydro Power,” 2013, and included in Wright, B. (2014). Feasibility of Tidal and Ocean Current Energy in False Pass, Aleutian Islands, Alaska, Final Report, Aleutian Pribilof Islands Association, Inc., U.S. Department of Energy, Renewable Energy Development and Deployment in Indian Country: DE-EE0005624.000. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 23 of 46 7/2/14 increased significantly over the past five years. Loads nearly doubled during 2011-2012, and due to recent expansions grew another 33% from 2013. So far in 2014, the plant has burned 53,907 gallons of fuel for electricity generation, up from 40,355 gallons the year before. Bering Pacific Seafood anticipates to further increase their operations from five months to ten months a year when Pacific cod processing begins in January 2015 and expects continued growth over the next five years with a goal of year round processing. Refrigeration compressors already require power on a 24-7 basis when the plant is in operation. The plant has experienced significant fluctuations in the price per gallon of fuel over the past five years from a low of $2.78 to a high of $4.70. These price fluctuations have considerable impact on the plant’s production costs and makes it very difficult to plan and budget for yearly operations. Impact the Project May Have on Existing Energy Infrastructure and Resources The development of a tidal project will help stabilize volatile energy costs, aiding in the sustainability of the community and the local seafood plant’s operations. Both of the diesel plants will continue to be maintained for load balancing and energy security purposes after the development of the tidal project. There will be the ability to optimize Bering Pacific Seafood plant operations to make best use of peak tidal power by targeting ice making at times when tidal energy peaks, as this is an intermittent activity that can be scheduled as needed. False Pass’s primary ‘storage capacity’ could be making and storing ice. Additionally, when Bering Pacific Seafood is offline, False Pass can schedule turbine maintenance. 4.2.3 Existing Energy Market Existing Energy Use and its Market The City of False Pass operates the community’s power utility and serves a mixture of residential and commercial customers: 21 residential; 11 commercial, including a seafood processing plant; 1 federal/state facility; and 9 community facilities. The Community’s average monthly electric demand is 30,739 kWh, and residents pay between 28 and 53 cents per kWh for electricity. (The national average is 9.92 cents per kWh.9 ) Currently, nearly all electricity and heat generated at False Pass comes from imported diesel fuel. In 2013, the City of False Pass utilized 53,153 gallons of diesel fuel for electrical generation, while the Bering Pacific Seafood plant utilized 40,355 gallons for self generation. Using the current price of $3.81 and the annual amount of fuel, electricity cost $202,513 in 2013 for the City of False Pass and $181,597 for the Bering Pacific Seafood Plant. The plant purchased an additional $48,159 worth of electricity from the City prior to processing operations beginning in 2013. Electricity generation with diesel fuel, therefore, is expensive for the community and local businesses and also has environmental impacts and risks associated with the transport, storage, and burning of this fuel. Impacts the Project May Have on Energy Customers At the currents measured at site S2 in False Pass, ORPC ‘s TidGen® device with a rated capacity of 200 kW and an availability of 95% would generate 60,833 kWh monthly (730,000 kWh/yr). This Project will determine what configuration of power system and number of devices will be needed to supply a reasonable amount of power to the community; additional TidGen® devices could be deployed to meet future energy demands. 9 U.S. Energy Information Administration, May 2013 Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 24 of 46 7/2/14 As Table 2 shows, a 200 kW TidGen® Power System would produce enough power to displace all of the electrical load of the False Pass utility, producing 126% of this annual load. However, since the tidally produced energy is cyclical there are times when no power will be produced and other times when the power produced from the TidGen® device exceeds the needs of the community. The amount of energy that could be utilized by the utility is less than the total produced. Analysis shows that ultimately slightly more than half of the energy produced by the TidGen® Power System can be utilized to existing utility loads, providing for 64% of the False Pass utility’s load while the remainder of the tidally produced power can be sold to Bering Pacific Seafood to offset self generation at the Bering Pacific Seafood plant. Currently the plant uses and additional 136,000 kWh a month when in operation, but is forecast to have a load growth to 170,000 kWh a month and year round operations. Using a clean, renewable energy source would also have the added benefit of giving a value- added green label to the local business such as the Bering Pacific Seafood plant, which could have a multiplier effect on the demand for the locally-produced seafood. In addition, the dollar amount that the City of False would save annually will only increase as fossil fuel prices rise. Table 2. ORPC 200 kW TidGen® Power System Monthly generation of in-stream device 60,833 kWh False Pass utility average monthly electric demand 48,256 kWh Monthly generation utilizable by City of False Pass 30,833 kWh Percentage of False Pass Utility electric demand produced by TidGen® device 126% Percentage of False Pass Utility demand actually offset by TidGen® device 64% 4.3 Proposed System 4.3.1 System Design To forecast the Project’s energy production and financial analysis, the Project Team has chosen ORPC’s TidGen® Power System as a model technology, which also will be considered for deployment for the proposed False Pass Tidal Energy Project. This selection allows the Project Team to assess the viability of the Project with an existing technology for which economic and power output data is available. 1. Description of Renewable Energy Technology Specific to Project Location ORPC power systems are designed around a proprietary turbine generator unit (TGU) containing advanced design cross flow (ADCF) turbines which drive the TGU’s underwater permanent magnet generator. The ADCF turbines are built with marine composite materials, and resist corrosion in both fresh and salt water. The TGU is gearless, requires no lubricants, and has no emissions. The TGU has a modular design adaptable to varying characteristics at different tidal installation sites. Multiple TGUs can be incorporated into complete power systems to convert the kinetic energy of water moving at tidal and riverine sites into grid-compatible electric power by means of various power electronics stages. The ORPC TidGen® device is a four-turbine TGU that is mounted on a bottom support frame securing it to the sea floor (Figure 8). It is designed to operate in water depths of 60 to 150 ft and generate up to 200 kilowatts (kW) at peak water flow conditions. For analysis purposes measurements are based on the TidGen® device’s rated capacity of 200 kW in a 5.4 knot current. A complete TidGen® Power System can include up to several dozen TidGen® devices, depending Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 25 of 46 7/2/14 upon market conditions, community needs, site characteristics and other considerations, deployed nearby or adjacent to one another, with individual TidGen® devices connected together by means of an underwater power consolidation module. Electricity is carried to shore through a single underwater power and data cable that terminates beyond the high-water mark at an on-shore station. The on-shore station is interconnected directly to the local utility power grid. The first grid- connected TidGen® Power System was installed with a single TidGen® device in Cobscook Bay in September 2012 (Figure 9). Figure 8. TidGen® device showing TGU and bottom support frame. Figure 9. TidGen® device installation in Cobscook Bay, Maine The TidGen® Power System that will be considered for the Project will be benchmarked at ORPC’s Nikiski test site near East Foreland in Cook Inlet, Alaska, over a 12 month test period.10 10 Funded in part by a $2 million grant from AEA to ORPC, “Cook Inlet TidGen® Project,” no. 7040059 This benchmarking will confirm the power system has been adapted to challenging Alaskan conditions and is ready for deployment at the remote False Pass site. The power system will be refurbished to bring it to new condition before being shipped to False Pass. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 26 of 46 7/2/14 2. Optimal Installed Capacity The proposed False Pass tidal energy project will begin with the installation of a single 200 kW TidGen® Power System. This is the optimal installed capacity to suit the existing loads and electrical configuration of the City. Currently the load for the False Pass utility averages around 66 kW. Based on analysis, the power produced by the TidGen® Power System will offset 64% of this average load; the remaining generated power will be sold to the Bering Pacific Seafood plant to offset their self generation. Without an energy storage component it will be challenging to economically increase the penetration of the tidal energy system into the False Pass utility as the largest impact on the ability to displace diesel fuel use is due to times when no tidal energy is available and diesel generation is required. Bering Pacific Seafood is likely to have the largest impact on future load growth as recent upgrades to the plant and increased operations increased the peak monthly energy use by 30% over last year to 155,000 kWh/month during processing, an average load of 215 kW. Bering Pacific Seafood anticipates that the load will increase by another 30% over the next five years and expand from seasonal operations to year round operations with a monthly load of 177,000 kWh, an average load of 245 kW. During times of peak generation, power from the TidGen® Power System will exceed load requirements for the False Pass Utility and allow additional power to be passed onto the Bering Pacific Seafood plant demonstrating the effectiveness of high penetration of tidally generated electricity into the Bering Pacific Seafood plant’s electrical usage. The system could eventually be built out to include additional TidGen® devices that would supply full power to the City and Bearing Pacific Seafood plant during times of tidal generation. In the future, it may also be economical to consider adding energy storage capacity to allow the False Pass Utility to meet its loads without the use of diesel fuel during times when tidally produced power is not available. 3. Anticipated Capacity Factor Based on a full lunar cycle of ADCP data collected in 2012 at False Pass, ORPC analyzed the anticipated capacity factor of a 200 kW TidGen® device at site N2, about ½ mile from the False Pass grid and at site S2, about two miles from the False Pass grid. As described above (Section 4.1), Table 1 shows the relative capacity factor at these sites. At site S2, the most likely candidate for tidal turbine placement at this time, an impressive capacity factor of 44.2% can be achieved, and with the added benefit of predictable delivery of this power, its value to the local energy portfolio is high. 4. Anticipated Annual Generation Table 3 also shows the anticipated annual generation in kWh at each of the sites. 5. Anticipated Barriers ORPC demonstrated the technical effectiveness of the TidGen® Power System in 2012 when the company built and operated the TidGen® Power System, becoming the first federally licensed hydrokinetic tidal energy project to deliver electricity to a power grid under a power purchase agreement in North America. Located in Cobscook Bay between Eastport and Lubec, Maine, the TidGen™ Power System was connected to the utility grid at an on-shore station in North Lubec on September 13, 2012. ORPC obtained a FERC pilot project license for the Project on February 12, 2012 and the first Maine Department of Environmental Protection General Permit issued for a tidal energy project on January 31, 2012. In addition, ORPC received approval for the first power purchase agreement for tidal energy from the Maine Public Utilities Commission on January 1, 2013. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 27 of 46 7/2/14 With $6 million in funding from the U.S. Department of Energy and Maine Technology Institute for technology optimization in 2014-2015,11 ORPC is now working to reduce risk by increasing reliability and extraction efficiency and lowering costs – the very same challenge that every new technology faces and the challenge that has, or is being, overcome with wind and solar technologies. ORPC has learned from these other renewable energy industries so overcoming the reliability, efficiency and cost challenges will be done in a more expedient and effective manner. We anticipate a continual and significant lowering of the cost of energy within the next couple of years. An example of the types of cost savings that are achievable is the innovative installation and retrieval techniques developed towards the end of the Project that reduced the cost of these operations by two-thirds. In managing the challenging conditions of new technology installed in the underwater marine environment, ORPC has also become an industry leader in the development and implementation of the adaptive management approach for environmental compliance, including using it as a mechanism for license modifications. 6. Basic Integration Concept Once the power reaches shore and the False Pass grid, it will be power conditioned at ORPC’s on- shore station to grid compatible three phase AC power with appropriate voltage for the location of interconnect. ORPC has been working with Marsh Creek to refine the power electronics for ORPC’s RivGen® Power System to interconnect with isolated diesel grids to maximize the ability to offset diesel consumption. This technology will be leveraged and transferred to the TidGen® Power System’s power electronics to ensure it will be capable of a reliable and efficient interconnect to the False Pass diesel electric grid. Initially, the project will be run in parallel with the diesel generation system offsetting the power required from the diesel. If it appears that the TidGen® Power System could meet all of the electrical loads of the False Pass Utility, the Project Team will consider retrofitting the power electronics to allow the TidGen® Power System to run in grid forming mode, which will allow diesel generators in False Pass to be shut off completely during these times, thereby maximizing the use of tidal energy and minimizing the diesel required for energy generation. Because independent generation capacity is maintained both by the City of False Pass and Bering Pacific Seafood it will be necessary to perform an integration study to optimize operations of both of these generation facilities when tidal energy is available to ensure that it will reduce diesel fuel usage at the maximum benefit. The power transmission system must also be considered for successful operation. If the ADCP survey performed in this Project confirms that the best location for tidal turbine placement will be in the vicinity of site S2, a power transmission at least two miles long will be required to transmit the power to shore. This cable must be designed and appropriately installed to ensure it will endure continued operations in the tidal environment and deliver reliable power to shore. ORPC has designed the TidGen® Power Systems with transmission distances similar to this and will condition the power from the TidGen® device underwater to allow it to be efficiently and reliably transmitted to the interconnect point. The Project Team has also considered the cost of the transmission line from the site two miles south of town in the project budget. Based on ORPC’s experience in the Cobscook Bay, Maine project, the TidGen® power and data cable—a submarine cable slightly under a mile long and capable of transmitting the power from five TidGen® devices, cost $423,000. The Project Team 11 ORPC, “Advanced Energy Harvesting Control Schemes for Marine Renewable Energy Devices,” DE- EE0006397; “Power Take-off System for Marine Renewable Devices,” DE-EE0006398; and Maine Technology Institute, “ORPC Technology Enhancements,” DL3604. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 28 of 46 7/2/14 used this number as the base for calculating the cost of a power and data cable installation at False Pass and factored it into the project budget. If a portion of the cable could be installed terrestrially this would further reduce these costs. In addition, the proposal was directed at identifying additional optional sites closer to town; this is one of the reasons we submitted the proposal for additional funding. 7. Delivery Method Power from the TidGen® Power System will be delivered to the False Pass grid where it will be dispatched, first to serve residential and community loads and then to provide power to the Bering Pacific Seafood plant, an existing customer of the utility. The Bering Pacific Seafood facility also has self generation capability, and the power from this project that is in excess of the current load demand of the utility will be utilized to offset the self generation needs of the Bering Pacific Seafood facility, further reducing diesel consumption in the community (See Section 5.5.1). 4.3.2 Land Ownership The shipping, mobilization and deployment of the tidal turbine will take place exclusively on the water using vessels and platforms. Land ownership concerns will be limited to transmission line access. During the 2013 bathymetric survey there were two preliminary sites identified for the submersible line to come ashore: (1) at the southern end of the airport and (2) at a dock owned by the Aleutians East Borough (AEB). The tideland access near the airport at False Pass (Unit # R22-06) is considered a municipal tideland. This area is retained in state ownership and managed by the Alaska Department of Transportation and Public Facilities (ADOT/PF). If the transmission line route is designed within the boundaries of the airport’s jurisdiction, applications and approvals would be needed from the Airport Leasing, Utilities and Right of Way sections within ADOT/PF. The City of False Pass will be required to apply for a utility permit through ADOT/PF for access to the electrical grid. A permit is required for land use through Airport Leasing, and a charge is applied by the square footage. Once a permit for land use is in place, a building permit is applied for through the Right of Way section. An FAA 7460-1 airspace obstruction approval may also be required. The normal timeframe for issuance of these permits is 60 days. The second option would use the AEB dock, the end of which is approximately ¼ mile from the nearest interconnection with the City of False Pass owned transmission line. Use of the dock for supporting transmission line access would require a permit and review process through AEB’s planning commission. The City of False Pass has a management agreement with AEB for the dock and would modify this agreement to include the operation and maintenance of a new transmission line. 4.3.3 Permits This Project will identify federal and state licensing and permitting requirements for a tidal turbine installation at the site. The only permits or licenses that would be required to complete this investigation will be submerged land use permits from the Alaska Department of Natural Resources (ADNR) for the deployment of bottom mounted scientific equipment, particularly the ADCP. At the federal level, tidal energy projects are under the jurisdiction of FERC. To facilitate these projects, FERC has implemented an expedited hydrokinetic permitting system through its pilot Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 29 of 46 7/2/14 license program as an alternative to the traditional full long-term hydropower licensing process. This pilot project process is intended to give projects that are small scale and short term an expedited licensing process, provided they are intensively monitored for environmental effects and able to be shut down on short notice if unacceptable environmental impacts that cannot be mitigated are encountered. Through this Project, we will determine the appropriate FERC licensing process. The Project Team will continue relationships with appropriate agency personnel as the permitting pathway for the larger tidal energy project is defined through this Project. Table 3 summarizes the applicable permits and anticipated permitting timeline for this Phase II project. Table 3. Permits for the False Pass Tidal Energy Project APPLICABLE PERMITS ANTICIPATED PERMITTING TIMELINE ADNR Submerged Land Use Permit Apply May 2015. FERC Preliminary Permit Phase II Feasibility work will not require a preliminary permit but may be prudent for site control Potential Barriers The Project Team believes potential permitting barriers will be minimal. They maintain ongoing relationships with federal and state agencies who would be involved in developing the permitting pathway for this tidal energy project and are diligent about keeping regulatory agencies appraised of Project milestones. In addition, ORPC has significant experience in working with FERC and holds a pilot project license for the Cobscook Bay Tidal Energy Project (P-12711)—one of only three pilot project licenses for hydrokinetic energy issued in the U.S. 4.3.4 Environmental A goal of this Project is to identify any environmental and permitting issues that would need to be addressed before installing a hydrokinetic turbine. The appropriate environmental studies and analyses must be completed to provide a basis for operating that minimizes the chance of potential impacts on the marine environment. The Project Team takes this task very seriously. While current reports of ORPC’s technology deployment and operation in Maine suggest that the turbines have no negative effects on fish, marine mammals, or other marine species, studies occur at each unique site to verify use by fish and other wildlife, and to assess any potential site-specific effects that would need to be monitored for or mitigated. We will consult with agencies, including (but not limited to) National Marine Fisheries Service (NMFS), U.S. Fish and Wildlife Services (USFWS) and Alaska Department of Fish and Game (ADF&G) to scope proper studies and identify areas of environmental concern and complete a comprehensive literature review in support of this effort. Additional assessments are anticipated in conjunction with the Endangered Species Act, Marine Mammal Protection Act, Magnuson Stevens Act (Essential Fish Habitat) and USFWS National Wildlife Refuge Management Plan. As part of Milestone 3 government consultations and stakeholder meetings with be completed within 8 months from the beginning of the project. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 30 of 46 7/2/14 Threatened or Endangered Species While current reports of ORPC’s technology deployment and operation in Maine suggest that their turbines have no negative effects on fish, marine mammals, or other marine species, ORPC anticipates that studies will occur at False Pass to verify local use by fish and other wildlife, and to assess any potential site-specific effects that would need to be monitored for or mitigated. We will consult with agencies, including (but not limited to) NMFS, USFWS and ADF&G to scope proper studies and identify areas of environmental concern and complete a comprehensive literature review in support of this effort. Additional assessments are anticipated in conjunction with the Endangered Species Act, Marine Mammal Protection Act, Magnuson Stevens Act (Essential Fish Habitat) and USFWS National Wildlife Refuge Management Plan. Informational available on the USFWS’s website indicates the following endangered species may be present at the site: • Stellar sea-lion (Eumetopias jubatus) • Northern Sea Otter (Enhydra lutris kenyon) Habitat Issues Environmental studies to date indicate no negative interactions with ORPC power systems. Nevertheless, ORPC anticipates collaborating with State and Federal regulators to develop environmental monitoring plans specifically for False Pass that are appropriate for a long term installation. Wetlands and Other Protected Areas The U.S. Fish and Wildlife’s National Wetland Inventory indicates no data is available for the location of the proposed project (Figure 9). Figure 9. National Wetland Inventory results for False Pass. The City of False Pass is located in an area not mapped by the Federal Emergency Management Agency Flood Insurance Rate Maps (Figure 10). However, since the subsea transmission cable will Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 31 of 46 7/2/14 connect to the existing electric grid it is anticipated that portions of the route will be located in floodplains. Figure 10. FEMA Flood Insurance Rate Map results for False Pass As of July 1, 2011, Alaska no longer has a federally approved coastal management program and federal consistency does not apply to Alaska. Archaeological and Historical Resources A search of the National Register of Historic Places for Aleutians East County in Alaska indicated there are no records for the area (Figure 11). Figure 11. National Register of Historic Places search results for Aleutians East County Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 32 of 46 7/2/14 Land Development Constraints There are no land development constraints. Shipping, mobilization and deployment of the tidal turbine will take place exclusively on the water using vessels and platforms. Land ownership concerns will be limited to transmission line access. During the 2013 bathymetric survey there were two preliminary sites identified for the submersible line to come ashore: (1) at the southern end of the airport and (2) at a dock owned by the Aleutians East Borough (AEB). The tideland access near the airport at False Pass (Unit # R22-06) is considered a municipal tideland. This area is retained in state ownership and managed by the Alaska Department of Transportation and Public Facilities (ADOT/PF). If the transmission line route is designed within the boundaries of the airport’s jurisdiction, applications and approvals would be needed from the Airport Leasing, Utilities and Right of Way sections within ADOT/PF. The City of False Pass will be required to apply for a utility permit through ADOT/PF for access to the electrical grid. A permit is required for land use through Airport Leasing, and a charge is applied by the square footage. Once a permit for land use is in place, a building permit is applied for through the Right of Way section. An FAA 7460-1 airspace obstruction approval may also be required. The normal timeframe for issuance of these permits is 60 days. The alternative option would use the AEB dock, the end of which is approximately ¼ mile from the nearest interconnection with the City of False Pass owned transmission line. The City of False Pass has ownership of the dock and would provide a permit. This permit would include language to account for the operation and maintenance of a new transmission line. Telecommunications Interference There is no anticipated telecommunications interference. ORPC, for example, will be able to design the Project to have no impact on fiber optic cable or any terrestrial transmission lines. Aviation Considerations Because ORPC power systems are fully submerged underwater, there are no aviation concerns, including float planes. Visual, Aesthetics Impacts Because ORPC power systems are fully submerged underwater, they are completely invisible from the surface, and have no effect on natural water landscapes. Other Potential Barriers Isanotski Strait is a dynamic and prolific marine environment and an important migratory pathway. The Project Team realized this early on and has been planning the project to account for costs that may be associated with monitoring plans for protected, threatened, or endangered species. Part of the feasibility study will focus on researching the marine species of concern and beginning agency consultation on study plans that may be required. Once the studies are defined and budgeted the project team intends to pursue outside funding sources for this work, reducing as much as possible the need to provide funding for environmental study costs through the REF. Sediment transportation is, however, not seen as a likely concern for this project. The water at False Pass is clear and the bottom at the preferred site is dense coble, hence there are little suspended sediment or sediment transport processes happening at this location. During the summer of 2013 Benthic GeoScience completed a site characterization defining the bathymetry, geomorphology, and geologic interpretation for areas which will include turbine siting and power cable infrastructure. As part of this effort, hazard assessment for the tidal project was Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 33 of 46 7/2/14 addressed. Although additional information from future measurements is expected to increase our understanding of site dynamics, this was a significant stage in identifying the potential for necessary environmental studies. The results from the 2013 site characterization identified low concern potential related to site geology and sediment transport. The seafloor throughout the project area consists of both consolidated and unconsolidated geology with bedrock presenting for much of the area. The areas currently targeted for turbine installation present as bedrock with a cobble to small boulder (boulder is defined by any clast 10 cm diameter or larger) scattering across the surface. Based upon the data available, Benthic GeoScience does not foresee nor recommend significant transport studies for the False Pass Tidal Power Project. Benthic GeoScience has recommend confirmation of this interpretation through “ground truth” efforts accomplished during future expeditions to site, these efforts are expected to accrue trivial cost increases and can be accomplished using optic video, Secchi disk, acoustic or optical backscatter, as well as water samples, some of which will be required for final design regardless. Again, this effort is trivial to accomplish and should ultimately confirm that sediment transport studies are unnecessary for the False Pass Tidal Energy Project With the data available, the Site Characterization Report does not identify significant issues related to ice nor debris. The site characterization is a significant accomplishment in addressing the specific concerns stated by AEA regarding fears related to unidentified environmental study costs and all indications do not warrant the same level of study as other areas within Alaskan waters. The concerns on lower availability and cost estimation are valid; however, all of the assumptions used in the proposal were grounded in actual experience operating a tidal energy project in Maine and adjusting costs for the Alaskan environment and remote conditions. 4.4 Proposed New System Costs and Projected Revenues (Total Estimated Costs and Projected Revenues) 4.4.1 Project Development Cost The total anticipated cost for this proposed tidal energy project is $6,870,575. This includes $491,146for the Feasibility Phase of the project proposed here: $428,646 in AEA funding and $62,500 in matching funds. These matching funds will be supplied by APICDA ($62,500 for vessels, captains, and room and board for field work). The projected capital cost of the tidal energy project is $5,122,446 installed, while the project development cost is expected to cost $1,748,129 including the $ 491,146 proposed for the Feasibility Phase work. 4.4.2 Project Operating and Maintenance Costs There will be no Operating and Maintenance Costs for this Phase II Feasibility Analysis and Conceptual Design Project. Anticipated O&M costs for a 200 kW tidal energy project, inclusive of environmental monitoring, inspections, maintenance, and repair, is estimated to be $160,000 per year. At $0.22/kWh this O&M number is realistic and substantially lower than the power sales price in False Pass, leaving a comfortable margin to service any capital cost debts and to provide a profit margin needed by the City of False Pass. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 34 of 46 7/2/14 4.4.3 Power Purchase/Sale Potential Power Customers The City of False Pass operates the community’s power utility, which serves the community of False Pass. The residents and businesses in False Pass are the customers. Potential Power Purchase/sales Price Commercial customers pay $0.36 / kWh, while community facilities and residential customers pay $0.42/kWh. Proposed Rate of Return For the economic analysis in this application a blended rate of $0.39/kWh escalated at 2% annually was assumed. At this rate the return on investment would be 2%. These rates will be used until the proposed system has been in operation for several months and a clear picture of energy savings has been developed. At that time a new rate may be implemented, but the savings will likely go towards a replacement and repairs account. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 35 of 46 7/2/14 4.4.4 Project Cost Worksheet Renewable Energy Source Annual average resource availability. Capacity Factor 44.2% availability 94% 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 12 i. Number of generators/boilers/other grid, leave this section blank) 3 generators owned and operated by City of False Pass ii. Rated capacity of generators/boilers/other (1) John Deere 6090AHM 180 kW generator set (1) John Deere 6081TF 125 kW generator set (1) John Deere 6081AF 175 kW generator set iii. Generator/boilers/other type iv. Age of generators/boilers/other 5 years old v. Efficiency of generators/boilers/other 13.38 kWh/gallon b) Annual O&M cost (if system is part of the Railbelt grid, leave this section blank) i. Annual O&M cost for labor $22,123 ii. Annual O&M cost for non-labor $17,034 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] 706,037 kWh City ii. Fuel usage Diesel [gal] 56,315 City. 40,355 by BPS plant Other iii. Peak Load 190 kW City. 456 kW BPS plant iv. Average Load 66 kW City. 245 kW BPS plant v. Minimum Load 56 kW City vi. Efficiency 12.5 kWh/gallon vii. Future trends Load expected to grow with additional production capacity at BPS to 245 kW average load. Already in 2014 fuel usage has increased to 53,970. d) Annual heating fuel usage (fill in as applicable) i. Diesel [gal or MMBtu] ii. Electricity [kWh] 730,000 iii. Propane [gal or MMBtu] iv. Coal [tons or MMBtu] 12 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. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 36 of 46 7/2/14 v. Wood [cords, green tons, dry tons] vi. Other Proposed System Design Capacity and Fuel Usage a) Proposed renewable capacity (Wind, Hydro, Biomass, other) [kW or MMBtu/hr] b) Proposed annual electricity or heat production (fill in as applicable) i. Electricity [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] iv. Other Project Cost a) Total capital cost of new system $5,122,446 b) Development cost $1,748,129 c) Annual O&M cost of new system $160,000 d) Annual fuel cost NA Project Benefits a) Amount of fuel displaced for i. Electricity 58,400 gallons ii. Heat iii. Transportation b) Current price of displaced fuel $ 3.81/ Gallon, $222,504 displaced annually c) Other economic benefits $1,300,000 of project capital costs will be spent on installation in Alaska and $140,000 of annual O&M costs will be spent on work in Alaska. The added direct and indirect economic benefit to the Alaskan economy through this is estimated at two times the locally invested funding and will be approximately $2,600,000 during installation and $280,000 annually during operation for a total of $8,200,000 over the 20 year lifetime of the project in Alaska and $140,000 of Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 37 of 46 7/2/14 annual O&M costs will be spent on work in Alaska. The added direct and indirect economic benefit to the Alaskan economy through this will be approximately $2,600,000 during installation and $280,000 annually during operation. d) Alaska public benefits This Project will add value to local business in False Pass by enabling green labeling of seafood products and tourism services. Power Purchase/Sales Price a) Price for power purchase/sale $0.39/kWh Project Analysis a) Basic Economic Analysis Project benefit/cost ratio .19 Payback (years) NA 4.4.5 Impact on Rates The current electric rate for PCE customers is $.42 kWh with a PCE rate of $.2777, making an effective rate of $.1430 for the first 500 kWh of usage for residential customers and all of the Community Facility usage. The non-PCE customer rate for commercial, federal and state customers is $.36 kWh. These rates are so low only because the City of False Pass subsidizes the fuel costs to their electric utility with State Revenue Sharing. Less fuel usage will not change the rates, but will allow the City of False Pass to use that money now used to subsidize fuel costs towards maintenance on the added equipment and a Replacement and Repairs account. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 38 of 46 7/2/14 SECTION 5– PROJECT BENEFIT Communities that are partially powered by renewable energy technologies reap economic, social, and environmental benefits. A good example close to False Pass is King Cove, which has a hydro project and the lowest charges for electricity in the Aleutians. Obvious benefits resulting from a False Pass tidal project are sustainable, high-quality job creation, enhanced quality of life, and energy independence for the community. Community members will have a renewed sense of pride knowing that their community is partially powered with renewable energy. A tidal energy project at False Pass would offer emission-free power that will both decrease the use of fuel oil and provide a flat-priced alternative as fossil fuel prices continue to rise. Potential Annual Fuel Displacement over the lifetime of the Evaluated Renewable Energy Project A single ORPC TidGen® device will be rated to produce 200 kW in a 5.4-knot current, in the robust currents measured at False Pass this device would produce enough power to save 222,504 gallons of fuel over the course of a year. This would amount to offsetting the production of 1,500,000 pounds of CO2 annually. By offsetting this diesel fuel usage alone, significant environmental risk associated with the threat of fuels spills in the transportation, storage, and use of the diesel fuel will also be mitigated. Furthermore, as an Alaskan community dependent on fishing as a resource, the reduction in CO2 will mitigate both climate change and ocean acidification, which both threaten to negatively affect the marine environment, jeopardizing fish stocks and compromising the commercial and subsistence livelihood of the community. This project allows the community of False Pass to proactively address these risks to the environment and promote economic development. Anticipated Annual Revenue The Project will generate revenue to the City of False Pass through the amount of diesel it offsets for energy production. The energy produced from this project will offset 58,400 gallons annually, at the current fuel price of $3.81.gallon this amounts to a cost savings of $222,504. Potential Additional Annual Incentives This Project will contribute to the local economy by providing local employment opportunities as well as business enhancement. These local jobs will have substantial multiplier effects in a small economy such as that in False Pass. It is estimated that $1,300,000 will be spent in Alaska during project installation, while $140,000 will be spent locally for annual maintenance. Conservatively doubling this amount over the lifetime of the project would mean $8,200,000 in added economic benefit from the project. Potential Additional Annual Revenue Streams The possibility of adding value to local seafood products through a development of products that feature sustainable labeling highlighting the tidal energy used in processing would add value to the local business and economy of False Pass. This will add to or enhance the revenue stream from the Bering Pacific Seafood processing plant that already significantly benefits the community. Non-economic Public Benefits to Alaskans over the Lifetime of the Project In addition to associated benefits of economic development and job creation in the community, other economic developments and benefits could result from the tidal project. It could be expanded, for example, to provide all of the power to the local Bering Pacific Seafood plant. Using a clean, innovative source of energy would give a value-added green label to the local business, which could have a multiplier effect on the demand for the locally-produced seafood. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 39 of 46 7/2/14 5.1 Public Benefit for Projects with Private Sector Sales While the City of False Pass will be the primary recipient of the power from a tidal energy project, there will be times when the output of the project exceeds the load of the city of False Pass. At these times it is anticipated that excess energy will be sold to and utilized by the expanded Bering Pacific Seafood plant at a slightly reduced rate to encourage maximum utilization of the tidally produced energy to offset self-generation and diesel use at the facility. Based on ADCP data collected at False Pass it is anticipated that 50% of the time a TidGen® Power system will produce more than the average load at False Pass of 66 kW. During these times approximately 360,000 kWh of energy annually will not be utilizable by the city and will be sold to the processing plant. Renewable energy resource availability (kWh per month) 60,833 Estimated sales (kWh) 30,000 Revenue for displacing diesel generation for use at private sector businesses ($) $10,800 Estimated sales (kWh) 30,833 Revenue for displacing diesel generation for use by the Alaskan public ($) $12,024 SECTION 6– SUSTAINABILITY Proposed Business Structures and Concepts that may be considered There are two business structures under consideration for the ownership and power sales associated with the installed tidal energy project. In either scenario that tidal energy project would be locally owned and operated, either by the City of False Pass, or by Bering Pacific Seafood. Financing the Maintenance and Operations for the Life of the Project The owner and operator of the project will be responsible for installation, operation and maintenance of the project and would sell the power produced at a rate that is competitive with diesel generation and provides adequate cash flow to perform operations, maintenance, and monitoring and to service any debt incurred in the installation of the project. Identification of Operational Issues that Could Arise As this is a marine renewable energy project operational issues will be largely handled through on- water operations requiring the owner to have marine construction experience or to contract to a company with this capacity. ORPC has established a model for the Cobscook Bay Tidal Energy Project in Maine where a subcontractor is responsible for all on water installation and maintenance operations and this may be a good example to follow for the project. Operational issues will include routine yearly maintenance of the TidGen® Power System, routine maintenance of environmental and project monitoring equipment, and unexpected maintenance of the TidGen® Power System. Description of Operational Costs, Including On-going Support The operational costs associated with this project will include yearly maintenance costs inclusive of major maintenance events scheduled for every five years, environmental and project monitoring, and project management costs. The City of False Pass and Bering Pacific Seafood will continue to operate and maintain their diesel electric generation facilities, as these will be required to provide power during periods of slack tide and to make up the power differential when the tidally produced power does not meet the demand of the community or facility. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 40 of 46 7/2/14 Commitment to Reporting the Savings and Benefits The City of False Pass will report the savings and benefits from the Project, and these will be reflected in the cost of delivered power to the customers of the utility. SECTION 7 – READINESS & COMPLIANCE WITH OTHER GRANTS The City of False Pass demonstrates readiness and compliance with other grants by serving as grantee of the following ongoing projects: • AEA, False Pass Wind Energy Project, $69,075. Project period: July 1, 2011 – June 30, 2014. • State of Alaska, Community Development Block Grant, Generator Replacement, $142,500. Project period: August 1, 2013 – September 30, 2014. • USDA Rural Utilities Service, High Energy Cost Grant. Pending 2015. The City of False Pass has the financial management capabilities to meet the requirements of these grants and project management capabilities by working collaboratively with their respective Project Teams to bring them to completion. Preliminary work on this Project was completed by a $206,956 project awarded to APIA by DOE to conduct a study of False Pass to determine whether a tidal energy project could provide renewable energy. The project scope included circulation modeling of False Pass, initial site visit to perform reconnaissance bathymetry, electrical infrastructure and load analysis, and initiation of permitting consultation. The Project was completed in 2014. If this Project is awarded, the Project Team intends to begin in summer 2015, the first available field season. SECTION 8 – LOCAL SUPPORT AND OPPOSITION The City of False Pass has received enthusiastic local support for a tidal energy project. Alaskan organizations and communities see tidal energy’s potential to help diversify the sources of our electricity as well as ameliorate the cost of diesel fuel. The Project Team, which has a strong record of community engagement and public support, will continue their ongoing work with scientists, fishers, and regulatory agencies to ensure that adequate means are in place to understand the marine environment. Throughout the Project period the Project Team will consult with stakeholders, regulatory agencies, and the public through regular project update mailings and meetings, addressing any concerns in a collaborative, proactive manner. Letters of Support from the following communities are included as in Section 11 B: • Ocean Renewable Power Company (ORPC Alaska) • Aleutians East Borough • Isanotski Corporation • Aleutian Pribilof Islands Association, Inc. • Aleutian Pribilof Islands Community Development Association Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 41 of 46 7/2/14 SECTION 9 – GRANT BUDGET 9.1 Funding sources and Financial Commitment To date a total of $465,518 has been invested in the project. This included $206,956 award to complete a reconnaissance survey of the project through funding from DOE’s Tribal Energy Program. Project partners provided cost shares for this work amounting to $17,762 from ORPC and $17,500 from APICDA. The project also benefited from $150,000 in programmatic funding from AEA that was provided to the Southwest Alaska Municipal Conference to support a bathymetric survey of the Project area for which APICDA provided a cost share of $43,300. AEA has also provided an additional $25,000 to support UAA circulation modeling utilizing this bathymetric data. All of the funds requested in this Phase II Feasibility proposal will be used by the City of False Pass for contractual services. These contractual services will be performed by ORPC, APIA, Benthic GeoScience and UAA, and will be matched by funding from APICDA. ORPC will provide project and grant management services amounting to a total of $138,360 and an ADCP survey for $136,686. APIA will perform an environmental literature survey and assist ORPC with drafting study plans for the project for $47,305. Benthic GeoScience will perform a sub bottom survey of the planned deployment area and cable route of the project for $81,000. UAA will validate the circulation modeling performed with AEA programmatic funding with ADCP field data collected during this effort for $25,295. APICDA will provide field work support for a cost share of $62,500. Looking ahead, the City of False plans to complete construction of the False Pass Tidal Energy with the following pending proposal – USDA Rural Utilities Service, High Energy Cost Grant, $3 million, pending 2015. Federal and state support of the False Pass Tidal Energy Project is summarized in Table 4: Table 4. False Pass Tidal Energy Project Grant Funding Project Phase Grants Status Phase I Reconnaissance • AEA, 2008 • AEA, 2010 • DOE Tribal 2012 Completed Phase II Feasibility and Conceptual Design • AEA Programmatic funding 2012-2014 • AEA, REF Round 8, 2014: Application pending 2015 Phase III Final Design and Permitting • AEA, REF Round 9, 2015 2016 Phase IV Construction and Commissioning • USDA RUS, 2014: Application pending 2017 While future funding for nearly every REF application has uncertainty, in the case of the False Pass Tidal Energy Project there is a high potential for significant investment from APICDA, one of the project partners with a large amount of investment already committed to the Bering Pacific Seafood plant. The success of this business hinges largely on the availability of reliable, affordable, clean energy, and APICDA has expressed strong interest in supporting a tidal energy project at False Pass. This reduces the uncertainty for future funding compared with other hydrokinetic projects that do not have a strong commercial partner onboard with a vested interest in the local energy market. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 42 of 46 7/2/14 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. It will be necessary to meter the power coming in from the Tidal energy project that is actually utilized to offset power that would otherwise be produced by the City of False Pass Diesel Electrical Generation (DEG) Plant or the Bering Pacific Seafood DEG Plant. The SCADA system provided for the tidal energy project will monitor how much power is produced by the tidal energy project and delivered to the grid, however, it may be necessary to add two meters to measure the power contributed to both the City of False Pass and that which is dispatched to the Bering Pacific Seafood grid. Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 43 of 46 7/2/14 Milestone or Task Anticipated Completion Date RE- Fund Grant Funds Grantee Matching Funds Source of Matching Funds: Cash/In- kind/Federal Grants/Other State Grants/Other TOTALS (List milestones based on phase and type of project. See Milestone list below. ) $ $ $ ADCP expedition planning and procurement completed 8/1/15 $5,677 $ $5,677 ADCP survey of 3-5 sites completed 11/1/15 $142,363 $46,936 APICDA contribution $189,299 Initial meetings with project stakeholders and regulatory agencies, desktop environmental literature surveys completed and presented to regulatory agencies 2/1/16 $51,208 $ $51,208 Draft study plans developed and submitted to regulatory agencies 3/1/16 $53,409 $ $53,409 Analysis of current energy costs, anticipated load growth and future energy costs completed 3/1/16 $5,677 $ $5,677 Alternative energy generation options analyzed 3/1/16 $5,676 $ $5,676 Latest cost data incorporated into financial model 1/15/16 $11,354 $ $11,354 Updated pro forma model developed incorporating ADCP data from survey 3/1/16 $42,972 $ $42,972 Sub bottom survey completed and data incorporated into conceptual design 6/1/16 $93,557 $15,564 $109,121 Project partners collaborate on business plan 7/1/16 $11,077 $ $11,077 Final Report Submitted to AEA 7/1/16 $5,676 $ $5,676 TOTALS $428,646 $62,500 $491,146 Budget Categories: Direct Labor & Benefits $ $ $ Renewable Energy Fund Round VIII Grant Application - Standard Form AEA 15003 Page 44 of 46 7/2/14 Travel & Per Diem $ $ $ Equipment $ $ $ Materials & Supplies $ $ $ Contractual Services $428,646 $62,500 $491,146 Construction Services $ $ $ Other $ $ $ TOTALS $428,646 $62,500 $491,146 SECTION 11.B. LETTERS OF SUPPORT 302 Gold Street, Suite 202 • Juneau, Alaska 99801 • (907) 586-0161 • Fax: (907) 586-0165 717 K Street, Suite 100 • Anchorage, Alaska 99501 • (907) 929-5273 • Fax: (907) 929-5275 September 20, 2014 Mayor Tom Hoblet 180 Unimak Drive False Pass, Alaska 99583 Dear Tom: The Aleutian Pribilof Island Community Development Association (APICDA) is pleased to provide a cost share match towards the City of False Pass’ proposal under Round VIII of the Alaska Energy Authority’s Renewable Energy Fund. The city’s Hydrokinetic Feasibility Study represents a critical stage in determining the viability of tidal power to reduce the community’s fossil fuel use. APICDA helped to provide vessel and ground support for the first two phases of feasibility work for this project. Next summer we will provide $62,500 worth of support in vessel time, crew, lodging, board, fuel and personnel during the remaining resource study efforts. We are very excited to participate in this endeavor and are hopeful that it will provide a path towards a more sustainable energy source for the city and our fish processing operations. APICDA has been working diligently with the city and other regional entities on energy planning, fuel security issues and exploring renewable alternatives to diesel generated electricity. We look forward to our continued partnerships and helping to shape a vibrant and healthy future for residents and businesses throughout the Aleutian and Pribilof Islands region. Sincerely, Larry Cotter Chief Executive Officer, APICDA SECTION 11.D. GOVERNING BODY RESOLUTION SECTION 11.G. ATTACHMENTS ORPC, Reconnaissance Current Survey Report, Prepared for the Aleutian Pribilof Island Association, April 1, 2013 < RECONNAISSANCE TIDAL CURRENT SURVEY REPORT PREPARED FOR THE ALEUTIAN PRIBILOF ISLAND ASSOCIATION April 1, 2013 ORPC Alaska, LLC 725 Christensen Dr., Suite 6 Anchorage, AK 99501 Telephone (207) 772-7707 www.orpc.co Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 2 of 15 Contents Figures............................................................................................................................................. 2 Tables .............................................................................................................................................. 3 Appendices ...................................................................................................................................... 3 Executive Summary ........................................................................................................................ 4 Data Collection Summary ............................................................................................................... 4 Data Analysis and Quality Control ................................................................................................. 7 Recoverable Energy ...................................................................................................................... 14 Conclusion .................................................................................................................................... 15 Figures Figure 1. Location of AWAC and RDI ADCP deployments. ........................................................ 6 Figure 2. Location of ADCP and HOBO deployments in the vicinity of False Pass. .................... 6 Figure 3. Tidal Rose for RDI ADCP deployed at site S2 10.7 meters above the seafloor. .......... 10 Figure 4. Tidal Rose for AWAC deployed at site N2 10.5 meters above the seafloor. ............... 10 Figure 5. Scatter plot showing current direction and magnitude from RDI ADCP data collected at site S2 10.7 meters above the seafloor. ..................................................................................... 11 Figure 6. Scatter plot showing current direction and magnitude from Nortek AWAC data collected at site N2 10.5 meters above the seafloor. ..................................................................... 11 Figure 7. RDI ADCP data from S2 showing velocity magnitude in m/s and current direction in degrees over 27.5 days of concurrent deployment, water surface level is shown at top (note velocity scale is different in Figures 5 and 6). .............................................................................. 12 Figure 8. Nortek AWAC data from N2 showing velocity magnitude in m/s and current direction in degrees over 27.5 days of concurrent deployment (note velocity scale is different in Figure 5 and 6). ........................................................................................................................................... 12 Figure 9. RDI ADCP data from S2 showing residual current velocity over deployment duration. A positive current is indicative of the northerly flood residual current while a negative current velocity is indicative of a southerly ebb residual current. The velocity data in the lower image represents the tidal velocity 10.7 meters above the seafloor. ....................................................... 13 Figure 10. AWAC data from N2 showing residual current velocity over deployment duration. A positive current is indicative of the northerly flood current while a negative current velocity is indicative of a southerly ebb residual current. The velocity data in the lower image represents the tidal velocity 10.5 meters above the seafloor. ............................................................................... 14 Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 3 of 15 Tables Table 1. Data logging parameters of AWAC and RDI ADCP. ....................................................... 7 Table 2. Energy density and current velocity comparison at N2 and S2. ....................................... 9 Table 3. Recoverable energy comparison at N2 and S2 approximately 10.5 meters above seafloor. ........................................................................................................................................ 14 Appendices Appendix A: Tidal Rose for each bin in the water column at sites N2 and S2 Appendix B: Tabular data from all bins in water column with quality data Appendix C: Photos from Deployment and Retrieval Operations Appendix D: Field Report, False Pass ADCP Deployment, September 28-October 3, 2012 Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 4 of 15 Executive Summary ORPC Alaska, LLC, a wholly-owned subsidiary of Ocean Renewable Power Company, LLC (collectively ORPC), performed a reconnaissance tidal current survey (Survey) to obtain a preliminary assessment of the potential for a tidal energy project as an energy alternative for the community of False Pass, Alaska under contract with Aleutian Pribilof Island Association (APIA). ORPC successfully collected Acoustic Doppler Current Profiler (ADCP) current velocity data from two sites in Isanotski Strait in the vicinity of False Pass over the course of a lunar cycle (one month) during the period from September to November 2012. The collected data was normalized through a quality control and data analysis process to allow for a comparison of the available tidal energy resource between the two sites. The Survey analysis shows that site “N2” in the near vicinity of False Pass has a marginal tidal energy resource, while site “S2” in the narrowest portion of the Isanotski Strait is an extremely robust tidal energy resource for tidal energy extraction utilizing currently existing hydrokinetic technologies. Based on the results of the Survey, the tidal energy resource in the vicinity of False Pass has sufficient energy for a viable tidal energy project. The results justify further investigation of the site characteristics, project development considerations, and project economics to determine the ultimate feasibility of a tidal energy project in the False Pass area. Data Collection Summary ORPC collected a lunar cycle (29.5 days) of current velocity data at two sites near False Pass that was used to make a preliminary determination of the potential for a tidal energy project.1 ORPC had agreed to provide data from at least one site, but was able to collect data at two sites as the National Renewable Energy Laboratory (NREL) supplied one additional ADCP for the project period. This enabled two sites to be measured at the same time, allowing a comparison of the energy resource of the two sites during the same time period. The field work and data collection was performed as described below: • September 28, 2012 ORPC deployed a team to False Pass to perform this tidal/ocean current resource reconnaissance under contract to APIA. Team members Monty Worthington, ORPC, David Oliver, Benthic GeoScience, and Levi Kilcher, NREL, mobilized to False Pass and met with Shane Hoblet contracted by the Aleutian Pribilof Island Community Development Association (APICDA) to skipper the Nightrider, a vessel of opportunity for the equipment deployment operations. The goal of this expedition was to deploy two ADCPs to measure current velocities at sites likely to have viable resources over a full lunar cycle (29.5 days), and to deploy two HOBO water level sensors to validate the University of Alaska Anchorage’s (UAA’s) modeling efforts. 1 A full lunar cycle of data allows analysis of the energy available through a full orbit of the moon around the earth. As the effect of the moon’s gravity is the primary constituent in tidal exchanges, this analysis provides an accurate estimate of annual energy potential from a site, provided tidal forces are the primary influence on current velocity at the site. Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 5 of 15 • September 29-30, 2013 ORPC investigated ADCP deployment sites, selected on the basis of UAA modeling efforts, local knowledge, and known bathymetry with a SeaKing Tritech Scanning Sonar. Seven sites were assessed for hazards to ADCP deployments in the vicinity of two prospective ADCP locations, and ultimately two sites “N2” in the vicinity of False Pass and “S2” approximately two miles south of the town of False Pass near Whirl Point were selected for deployment (Figure 1). • September 30, 2012 At 19:50 AKDT a 600 kHz Nortek Acoustic Wave and Current (AWAC) profiler provided by NREL was deployed and began collecting data at N2 (lat -163.3870W long 54.8515N). • October 2, 2012 At 19:59 AKDT a 300 kHz RDI ADCP was deployed and began collecting data at S2 (lat -163.3676W long 54.8174N). The HOBO water level sensors were also deployed approximately 7 nm North and South of False Pass (Figure 2). • October 29, 2012 Monty Worthington, ORPC, mobilized back to False Pass for ADCP recovery operations where he met Calvin Kashevarof under contract to APICDA to skipper the Nightrider for these efforts. • October 30, 2012 At 12:44 AKDT the AWAC ADCP was recovered and completed its data collection, logging 29.7 days of data. • November 3, 2012 The HOBO deployed north of False Pass was recovered at 12:30 AKDT. • November 4, 2012 The RDI ADCP deployed at S2 was recovered at 17:45 AKDT. This ADCP had stopped recording data on October 3, 2012 at 3:57 AKDT due to premature battery depletion, logging 28.35 days of data. March 25, 2012 The HOBO deployed south of False Pass was recovered by Shane Hoblet and his crew while commercial fishing. It had washed up on the beach near its deployment site and will be returned to UAA for data analysis. The location of the two sites at which the ADCPs were deployed is shown in Figures 1 and 2. Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 6 of 15 Figure 1. Location of AWAC and RDI ADCP deployments. Figure 2. Location of ADCP and HOBO deployments in the vicinity of False Pass. Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 7 of 15 Data Analysis and Quality Control ADCP Configuration Both the RDI AWAC and Nortek ADCP were configured in the field and calibrated for each of the sites, including calibration of the magnetic compass on each device, setting of the deployment depth, and configuring the data acquisition parameters. Each device passed the configuration checks performed under the guidance of NREL and Benthic Geoscience personnel. Differences in the two devices necessitated programming each device to sample and store data at different intervals while optimizing for the maximum rate of data collection, storage and battery life. This programming allowed the data to be utilized to the maximum extent for analysis of the strength of the resource, direction of the currents, and potential analysis of turbulence (Table 1). Each device also had a slightly different “blanking distance.” This is the distance between the device and the first bin of data. This resulted in a 0.2 meter difference in the height above the seafloor of nearest data bins between the two devices. Table 1. Data logging parameters of AWAC and RDI ADCP. Data Quality Control The data from the AWAC and RDI ADCPs was downloaded from the devices, and data quality and accuracy was verified independently by NREL and ORPC. Data analysis was focused approximately 10.7 meters above the bottom for the RDI ADCP and 10.5 meters above the bottom for the AWAC ADCP—the anticipated height of ORPC’s TidGen™ device and a likely hub height for medium sized tidal turbines. Data was also analyzed throughout the water column for comparison purposes (see Appendix A and B). The strongest near surface current velocities and highest energy densities were also identified. As the RDI had a pressure sensor, it also collected data on the water level and identified the surface of the water. The AWAC did not have a pressure sensor, so water surface and “false” data bins from above the water surface were identified by unrealistic trends in the data. At site N2, the deployment depth was 26 meters (85 feet) and at least 22 bins of quality data were collected above. The data, however, appeared Device and Site Data Collection Start (AKDT) Data Collection End (AKDT) Data Collection Duration Blanking Distance (meters) Bin Size (meters) Sample Rate Data Storage RDI ADCP at site S2 10/2/12 at 19:59 10/31/12 at 3:57 28.35 days 3.2 1 Ping every 1.8 sec Average of 5 pings stored every 9 sec Nortek AWAC at site N2 9/30/12 at 19:50 10/30/12 at 12:44 29.7 days 1 1 Ping every 1 sec Average of 60 pings stored once a minute Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 8 of 15 unreliable due either to surface reflection or possibly interference from the submerged buoy used in the deployment. At site S2 the deployment depth was 35 meters (114 feet), and 32 bins of quality data were collected. One challenge encountered in performing a comparative analysis of the sites was due to the fact that the RDI ADCP, deployed at site S2, had stopped logging data before the end of the synodic full lunar cycle (28.35 days of data instead of 29.53 days). This was likely due to premature battery depletion. The ADCP had been programmed to use 90% of its battery over a 29.5 day deployment which should have left reserve capacity; but this was not the case. Because of this, it was necessary to determine how to normalize the data for comparison purposes between the two sites because a full lunar cycle of data was not collected at S2. ORPC analyzed the difference between the data collected by first comparing the data from a full lunar cycle which was collected at N2 to the data from site N2 during the 27.5 days during which concurrent data was collected at site S2. Mean velocities at the selected depth (10.5 meters above the seafloor) were 1.24 m/s for the flood tide for both durations, while for the ebb tide, the mean velocity was slightly higher for the full lunar cycle at 1.25 m/s (as opposed to 1.24 m/s for the 27.5 day cycle, a difference of less than 1%). The average energy density also differed slightly between 1.57 kW/m^2 for the full lunar cycle as compared to 1.54 kW/m^2 for the period of concurrent data collection. This represents a 1.9% difference in energy density; a larger difference than the current velocity as it varies as a cube of current velocity. This difference is within the acceptable range for extrapolating annual energy output as natural variations between concurrent lunar cycles may exhibit similar differences. It was therefore deemed a correct approach to focus on the 27.5 day time period of concurrent data collection for comparison of energy at the two sites and for extrapolation of annual energy production. The data presented in this report was analyzed over the 27.5 day time period of concurrent deployment. Current velocity, energy density and flow symmetry comparison Table 2 shows the comparative current velocities and energy density at sites N2 and S2 using the 27.5 days of direct overlap in deployment of the two devices. At 10.5 meters above the seafloor, the N2 site had a maximum velocity of 2.51 m/s and average velocity of 1.24 m/s and an average energy density of 1.54 kW/m^2. By comparison, at 10.7 meters above the seafloor the S2 site had a maximum current of 3.68 m/s an average velocity of 1.62 m/s and an average energy density of 3.68 kW/m^2—over twice the available energy of site N2. At both sites, the strongest currents occurred during the ebb (southerly) flows. Peak current velocities and energy densities occurred near the surface of each site, but, here again, energy density at site S2 was more than double that of N2. Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 9 of 15 Table 2. Energy density and current velocity comparison at N2 and S2. The flow direction and its symmetry between flood and ebb events at tidal sites can be highly variable, and this can have adverse effects on energy capture using tidal turbines. It is important to analyze this aspect of tidal currents as asymmetric currents can have adverse effects on total recoverable energy. In addition to analysis of the mean direction and standard deviation of the currents direction in Table 2, ORPC generated a “Tidal Rose” for each site at the tidal turbines hub height to graphically depict current direction, symmetry, and magnitude. These Tidal Roses reveal that the flow is highly symmetric (near to180 degrees opposed) at sites S2 and N2 and that viable current velocities for energy production occur a large amount of the time. However, current velocities and overall energy at N2 are significantly lower as noted above. Figures 3 and 4 show the Tidal Rose for the selected depth for energy analysis of each site. A Tidal Rose for each bin of data is included in Appendix A. A similar analysis, highlighting the current direction and magnitude with scatter plots, is displayed in Figures 5 and 6. Site (depth above seafloor) N2 (10.5 m) S2 (10.7m) N2 (20.5 m) S2 (32.7m) Flood Mean Direction (deg) -33.8 -19.7 -34.7 -23.8 Std. Deviation from Mean axis (deg) 3.90 13.30 3.89 9.91 Mean Speed (m/s) 1.24 1.47 1.41 1.67 Max Sustained Speed (m/s) 2.30 2.96 2.64 2.92 Mean Power Density (kW/m^2) 1.49 2.56 2.21 3.72 Ebb Mean Direction (deg) 154 167 162 162 Std. Deviation from Mean axis (deg) 2.94 3.03 4.33 1.96 Mean Speed (m/s) -1.24 -1.76 -1.41 -2.14 Max Sustained Speed (m/s) -2.51 -3.68 -2.85 -4.46 Mean Power Density (kW/m^2) 1.60 4.82 2.34 8.76 Combined Mean Speed (m/s) 1.24 1.62 1.41 1.91 Max Sustained Speed (m/s) 2.51 3.68 2.85 4.46 Mean Power Density (kW/m^2) 1.54 3.68 2.27 6.21 Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 10 of 15 Figure 3. Tidal Rose for RDI ADCP deployed at site S2 10.7 meters above the seafloor. Figure 4. Tidal Rose for AWAC deployed at site N2 10.5 meters above the seafloor. Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 11 of 15 Figure 5. Scatter plot showing current direction and magnitude from RDI ADCP data collected at site S2 10.7 meters above the seafloor. Figure 6. Scatter plot showing current direction and magnitude from Nortek AWAC data collected at site N2 10.5 meters above the seafloor. Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 12 of 15 Data Analysis over the entire water column The following figures illustrate the data of the site inclusive of the entire water column to provide a perspective on how the resource varies as a function of depth and time. Figures 5 and 6 show the temporal and spatial variation of current velocity magnitude and direction at sites S2 and N2 correspondingly. Figure 7. RDI ADCP data from S2 showing velocity magnitude in m/s and current direction in degrees over 27.5 days of concurrent deployment, water surface level is shown at top (note velocity scale is different in Figures 5 and 6). Figure 8. Nortek AWAC data from N2 showing velocity magnitude in m/s and current direction in degrees over 27.5 days of concurrent deployment (note velocity scale is different in Figure 5 and 6). Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 13 of 15 Figures 7 and 8 show the spatial and temporal variation of the “residual” current velocity correspondingly at sites S2 and N2. This residual current is the net flow of water over the deployment period with the tidally influenced flows extracted. These residual currents are only at a single column in the cross section of the channel and can be explained by circulation patterns where ebb currents are enhanced in one portion of a channel and flood currents are enhanced in another area while the net current is essential zero. Fresh water input at one end of an estuary can also lead to residual currents being stronger in one direction than another. These currents are not generally of large consequence for tidal energy extraction, but the information is included here to provide differentiation of tidal versus ocean currents at False Pass as the influence of each was not well understood at the onset of this study. During initial desktop investigation into the False Pass project site, it was suspected that the northwesterly flowing Alaska ocean current might have an influence in creating a stronger northerly flood current while diminishing the southerly ebb current. As these residual current velocity charts suggest, larger tidal variations resulted in a stronger residual southerly ebb current at both sites and overall energy was higher on the ebb tide over the course of the month. Smaller tidal variations corresponded to a stronger residual northerly flood current though overall flood energy was lower at both sites. Figure 9. RDI ADCP data from S2 showing residual current velocity over deployment duration. A positive current is indicative of the northerly flood residual current while a negative current velocity is indicative of a southerly ebb residual current. The velocity data in the lower image represents the tidal velocity 10.7 meters above the seafloor. Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 14 of 15 Figure 10. AWAC data from N2 showing residual current velocity over deployment duration. A positive current is indicative of the northerly flood current while a negative current velocity is indicative of a southerly ebb residual current. The velocity data in the lower image represents the tidal velocity 10.5 meters above the seafloor. Recoverable Energy For a tidal energy device such as ORPC’s TidGen™ turbine generator unit (TGU), deployed with a hub height 10.5 meters above the bottom, a swept area of 59 m^2 and an efficiency of 32.3%, the annual energy delivery from site N2 would be 284,490 kWh, resulting in a capacity factor of 21.6%. By comparison the same device deployed 10.5 meters above the bottom at S2 would have an annual generation of 577,655 kWh and a 43.9% capacity factor. For higher efficiency (36%) turbines with the same swept area, such as future versions of ORPC power systems, the annual energy delivered would increase to 318,972 kWh and 24% capacity factor at N2 and 624,941 kWh and 47.5 % capacity factor at S2. By comparison to other sites which ORPC has studied in Alaska and Maine, site S2 represents a robust and very attractive tidal energy resource, while site N2 is a marginal resource for energy production using a device analogous to ORPC’s TidGen™ TGU. Table 3. Recoverable energy comparison at N2 and S2 approximately 10.5 meters above seafloor. Site N2 10.5 m above seafloor S2 10.7 m above seafloor Annual recoverable energy (59 sq m turbine with 32.2% efficiency) 284,490 kWh 577,655 kWh Annual recoverable energy (59 sq m turbine with 36 % efficiency) 317,107 kWh 625,258 kWh Ocean Renewable Power Company Reconnaissance Tidal Current Survey Report April 1, 2013 Confidential Page 15 of 15 Conclusion Based on the results of the reconnaissance tidal current survey performed in the False Pass area, it is clear that, from strictly a resource perspective, site S2 has great potential and site N2 is marginal at best. However, many other factors come into play when evaluating the feasibility of a site for a tidal energy project. These factors include bathymetric and geotechnical considerations, access to the site, proximity to the interconnection point with the local grid, etc. The evaluation of the feasibility of a tidal energy project at a marginal resource site such as N2 is highly dependent on the costs associated with the development and construction of the project and the value of the power that is delivered. While the energy density found at site N2 is much lower than that encountered at S2, the short transmission distance from site N2 to the interconnect locations in False Pass (approximately ½ mile) and the relative easy access to the site could reduce associated construction costs significantly and make a project in its vicinity economically viable. It is also entirely possible that better tidal current velocities exist in the near vicinity of site N2 that could increase the site’s energy density to a point where development of a project is more attractive. ORPC believes it would be worthwhile to enhance circulation modeling efforts in the vicinity of N2 to determine if local variations in the velocity profile would lead to identification of one or more specific sites with higher energy density. This could tip the scales in favor of a tidal energy project in the vicinity of site N2, and if so, make it desirable to follow up with an ADCP survey at the location(s) of interest. The robust tidal energy resource at site S2 will provide exceptional output from a tidal energy project with impressive capacity factors in the range of 40-50% of rated capacity. Site S2 is, however, more remote than site N2, and construction costs will likely be higher, especially for the associated power transmission line which would be at least 2 miles long. Further investigation of project development considerations and constructability of a tidal energy project at site S2 are warranted to assess the economics of installing a tidal energy project at this site. Of key importance in this assessment will be a bathymetric survey covering the area of potential device locations and submarine power cable routes, and analysis of technical and cost considerations for a power cable line to connect the project to False Pass.