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HomeMy WebLinkAboutYerrick Creek Appendix 091914 APPENDICES  Certificates o UTE Certificates o UTE Partnership MOU o Resolution No. 2014-10 from Native Village of Tanacross o Resolution No. 2014-1 from Tanacross, Inc.  Project Figures  Permitting  RUS EA & FONSI  Media  Letters of Support  Resumes  Photos State of Alaska Department of Commerce, Community and Economic Development Corporations, Business and Professional Licensing Alaska Entity #10022902 Certificate of Organization The undersigned, as Commissioner of Commerce, Community and Economic Development of the State of Alaska, hereby certifies that a duly signed and verified filing pursuant to the provisions of Alaska Statutes has been received in this office and has been found to conform to law. ACCORDINGLY, the undersigned, as Commissioner of Commerce, Community and Economic Development, and by virtue of the authority vested in me by law, hereby issues this certificate to Upper Tanana Energy LLC IN TESTIMONY WHEREOF, I execute the certificate and affix the Great Seal of the State of Alaska effective August 14, 2014. Susan K. Bell Commissioner Alaska Department of Commerce, Community, and Economic Development Division of Corporations, Business and Professional Licensing P.O. Box 110806, Juneau, Alaska 99811-0806 Alaska Business License # 1009335 This is to certify that UPPER TANANA ENERGY LLC 136 MISTY MARIE LANE KETCKIKAN AK 99801 owned by UPPER TANANA ENERGY LLC This license shall not be taken as permission to do business in the state without having complied with the other requirements of the laws of the State or of the United States. This license must be posted in a conspicuous place at the business location. It is not transferable or assignable. Susan K. Bell Commissioner is licensed by the department to conduct business for the period August 14, 2014 through December 31, 2015 for the following line of business: 22 - Utilities MEMORANDUM OF UNDERSTANDING NATIVE VILLAGE OF TANACROSS RESOLUTION NO. 2014-10 TANACROSS, INC. RESOLUTION NO. 2014-1 ResolutionNo.2DI‘/ARESOLUTIONOFTANACROSS,INC.REGUARDINGRENEWABLEENERGYFUNDGRANTROUNDVIIIINVESTMENTBYTHEALASKAENERGYAUTHORITYFORTHEYERRICKCREEKHYDROELECTRICPROJECT.WhEREAS,theTokandupperTananaregioniscurrently100%reliantupondiesel-firedgenerationofenergy,whichcreateshighcostsofenergyforfamiliesandbusinesses;andWHEREAS,the1.5megawattYerrickCreekhydropowerprojecthasthepotentialtogenerate4,900,000kilowatthoursofcleanenergyperyearat50%thecostofdiesel-firedgeneration,eliminating375,000gallonsofdieselfuelperyearovera50+yearprojectlifespan,andhelpingtostabilizeenergycostslong-term;andWhEREAS,TanacrossInc.,theNativeVillageofTanacross,andAlaskaPower&TelephonehaveexecutedaMemorandumofUnderstanding(“MOU”)todeveloptheYerrickCreekhydropowerproject,andareformulatinganewpartnershipfortheprojectnamedUpperTananaEnergy;andWHEREAS,theYerrickCreekprojectissupportedby7yearsofanalysisandstudyfundedbyfederalgrantsandprivatesectorinvestment,andhasreceivedaFERCnon-jurisdictionaldetermination;andWHEREAS,someconstructionfundingisavailablethroughanexistingUSDARUSgrant(secured),andAlaskaPower&Telephonehasexpressedawillingnesstoprovideadditionalinvestmentinconstruction-phaseactivities;andWHEREAS,MOUpartnersanticipatethatallremainingpermitting,powersalesagreement,andotherpre-constructionactivitieswillbecompletebythe2015constructionseason,makingREFVIIIconstructionphasefundingtimelyandappropriate;andWHEREAS,AlaskaPower&Telephonehasagreedtopurchase100%oftheproject’soutputbeginninginyearone,assuringamarketfortheentiretyoftheproject’spowerandenergy;andWHEREAS,theYerrickCreekproject’sreportedpotentialtoeliminate40%ofdieselfiredgenerationintheTokandupperTananaregionisconsistentwiththeState’spolicygoalof50%renewableenergyby2025;andWHEREAS,theStateofAlaskahasassistedmanycommunitiesinAlaskainaddingrenewableenergytotheirlocalenergymix;residentsoftheupperTananaregion,who remain100%dependentupondiesel-firedgeneration,deserveanequitableopportunitytoachieveStatesupportsothattheymayhome-sourceenergyfromlocallyavailablerenewables;andNOWTHEREFOREBEITRESOLVEDASFOLLOWS:Section1.Tanacross,Inc.supportsandendorsesthegrantfundingapplicationundertheAlaskaEnergyAuthorityRenewableEnergyFundRound8programforthecapitalprojectidentifiedbelow:YerrickCreekHydroelectricProject:ConstructionRequestAmount--$8,000,000Section2.RobertBrean—President,Tanacross,Inc.isauthorizedtosigndocumentsrelatedtoandexpressingTanacross,Inc.’ssupportfortheAlaskaEnergyAuthorityRenewableEnergyFundRound8programforthecapitalprojectidentifiedabove.DATEDTHIS/9DayofP.,o/t/ATTEST:[INSERTNAME]c$_-i’-C’[INSERTNAME] PROJECT FIGURES RURAL UTILITY SERVICE (RUS) ENVIRONMENTAL ASSESSMENT & FINDING OF NO SIGNIFICANT IMPACTS BLANK PAGE [intentionally left blank] Environmental Assessment Yerrick Creek Hydroelectric Project Mile Post 1339, Alaska Hwy 20 Miles West of Tok, Alaska Prepared for: U.S. Department of Agriculture Rural Utilities Service (RUS) Prepared by: Alaska Power & Telephone Company Corporate Headquarters Port Townsend, Washington April 2010 Author: Glen Martin – Project Manager Alaska Power & Telephone Company P.O. Box 3222 Port Townsend, WA 98368 (360) 385-1733 x122 (360) 385-7538 fax glen.m@aptalaska.com Page | ii   SUMMARY  The USDA Rural Utilities Service (RUS) has selected the Alaska Power & Telephone Company (AP&T) as a finalist in its High Energy Cost Grant Program to construct the proposed Yerrick Creek Hydroelectric Project (or Project). The proposed Project would be located approximately twenty miles west of Tok, Alaska, at Mile Post 1339 on the Alaska Highway. The proposed Project would supply renewable energy to four communities in the Tok area: Dot Lake, Tanacross, Tetlin, and Tok. Prior to making an award for a partial grant, RUS has determined that an Environmental Assessment (EA) must be prepared, pursuant to 7 CFR Part 1794, RUS’s Environmental Policies and Procedures, as amended. This EA identifies environmental impacts associated with the construction and operation of the proposed Project. It has been decided that impacts associated with upgrading the supporting transmission system would be minimal, as the infrastructure already exists and would only require minor upgrading and the stringing of a higher voltage conductor. All of this work would occur in previously disturbed rights-of-way that previously have been cleared of vegetation. The Project would be located on lands owned by the state of Alaska and Tanacross, Inc. This proposed Project is needed because the communities of Dot Lake, Tanacross, Tetlin, and Tok rely on diesel generation for their electricity, which is expensive and fluctuates frequently. The Project would reduce electric rates to these four communities by approximately 20%. Several of these communities are on the Denali Commission’s list of distressed communities 1 as this area is experiencing a significant economic downturn. Reducing electric rates may help the local economy. The results of the impact analysis show the project may have the follow environmental affects:  Temporarily impact wildlife due to noise from construction activity, which may temporarily impact hunting in the area  Have a minor impact to wetlands, by placing fill in the creek (i.e. diversion structure, bridge piers (2), part of tailrace)  Have a minor impact to Dolly Varden and Arctic grayling in the bypass section of Yerrick Creek during winter and late summer months because of low flow  Provide easier access for recreation, potentially disturbing wildlife  Reduce the use of diesel in Tok, which in turn would reduce air emissions of green- house gases and particulate matter as well as reducing opportunities for fuel spills     1 Dot Lake, Tanacross, and Tetlin are on the 2009 Denali Commission list of distressed communities. Tok was on the 2008 list. Page | iii TABLE OF CONTENTS  SUMMARY...........................................................................................................................ii LIST OF FIGURES..............................................................................................................iv LIST OF APPENDICES.......................................................................................................iv LIST OF ACRONYMS & ABBREVIATIONS....................................................................v 1 INTRODUCTION.........................................................................................................1 2 PROJECT DESCRIPTION............................................................................................3 3 PURPOSE/NEED FOR PROPOSED ACTION............................................................5 4 ALTERNATIVES..........................................................................................................6 4.1 No Action...............................................................................................................6 4.2 Energy Generation Technologies Considered .......................................................6 4.3 Alternative Locations for siting the hydroelectric facility .....................................7 5 AFFECTED ENVIRONMENT.....................................................................................8 5.1 Land Use................................................................................................................8 5.2 Cultural Resources and Historic Properties ...........................................................8 5.3 Biological Resources ...........................................................................................10 5.3.1 Fish Resources.............................................................................................10 5.3.2 Wildlife (mammal) Review.........................................................................11 5.3.3 TES botanical survey...................................................................................14 5.4 Water Quality & Quantity.................................................................................... 15 5.4.1 Water Quality...............................................................................................15 5.4.2 Water Quantity.............................................................................................15 5.5 Floodplains/Wetlands ..........................................................................................16 5.6 Environmental Justice..........................................................................................17 5.7 Socioeconomics ...................................................................................................17 6 ENVIRONMENTAL CONSEQUENCES..................................................................19 6.1 Alternative 1: No – Action...................................................................................19 6.2 Alternative 2: The Proposed Project....................................................................19 6.2.1 Land Use......................................................................................................19 6.2.2 Cultural Resources and Historic Properties .................................................20 6.2.3 Biological Resources ...................................................................................20 6.2.4 Water Quality & Quantity............................................................................ 21 6.2.5 Floodplains/Wetlands ..................................................................................21 6.2.6 Environmental Justice..................................................................................22 6.2.7 Socioeconomics ...........................................................................................22 7 MITAGATION AND PERMITS ................................................................................23 8 LITERATURE CITED................................................................................................25 9 APPENDICES.............................................................................................................27 9.1 Agency Correspondence.......................................................................................... 9.2 Hydrology Studies ................................................................................................... 9.3 Biological and Other Surveys.................................................................................. 9.4 2009 Denali Commission List of Distressed Communities..................................... Page | iv LIST OF FIGURES  Figure 1: Map of Proposed Project Area..............................................................................1 Figure 2: Proposed Project Features.....................................................................................2 Figure 3: Transmission Line Features...................................................................................4 LIST OF APPENDICES  9.1 – Project Correspondence 9.2 – Hydrology / Feasibility Report 9.3 – Biological Surveys 9.3.1 – Fish Resources Report 9.3.2 – Threatened, Endangered, Sensitive (TES) Plant Report 9.3.3 – Literature Review and Field Report: Hydrology Baseline Study 9.3.4 – Preliminary Jurisdictional Determination 9.3.5 – Heritage Resource Survey 9.4 – 2009 Denali Commission List of Distressed Communities   Page | v LIST OF ACRONYMS & ABBREVIATIONS  % percent ADF&G Alaska Department of Fish & Game AKNHP Alaska National Historic Preservation ALA APE area of potential effect AP&T Alaska Power and Telephone ATV All terrain vehicle cfs cubic feet per second CO2 carbon dioxide DNR Alaska Department of Natural Resources EA Environmental Assessment HDPE kV kilovolt kWh kilowatt-hour MW megawatt NEPA National Environmental Policy Act OHW Ordinary high water (mark) pop. population ROW right-of-way RUS Rural Utilities Service SHPO State Historic Preservation Office TES threatened, endangered, and sensitive (species) USACOE U.S. Army Corp of Engineers USGS U.S. Geological Service Page | 1 1 INTRODUCTION  The USDA Rural Utilities Service (RUS) has selected the Alaska Power & Telephone Company (AP&T) as a finalist in its High Energy Cost Grant Program to construct the proposed Yerrick Creek Hydroelectric Project (20 Miles west of Tok, Alaska at Mile Post 1339, Alaska Hwy). The granting of funds by RUS is a federal action subject to environmental impact review, pursuant to the National Environmental Policy Act (NEPA) and RUS’s NEPA implementing regulations, Environmental Policies and Procedures, 7 CFR Part 1794, as amended. RUS has determined that an Environmental Assessment (EA) must be prepared for this Project. This EA provides an analysis of potential environmental impacts, which may result from RUS’s action related to this proposal. RUS Bulletin 1794A-601, “Guide for Preparing an Environmental Report for Electric Projects Requiring an Environmental Assessment,” was used as guidance in the preparation of this EA. In addition to fulfilling its obligations under NEPA, this EA also documents RUS’s compliance with Section 106 of the National Historic Preservation Act, Section 7 of the Endangered Species Act, and other applicable environmental laws and regulations. Figure 1: Map of Proposed Project Area Page | 2 Figure 2: Proposed Project Features Page | 3 2 PROJECT DESCRIPTION  AP&T plans to construct a 1.5 megawatt (MW) “run-of river” hydroelectric facility that would supply renewable energy to the communities of Tok, Tetlin, Tanacross, and Dot Lake, Alaska. The facility could potentially supply 100% of the communities' energy demand during high flow periods (typically June and July). During the remainder of the year, only part of the load would be met. AP&T’s hydrology studies indicate there will be sufficient flow during the extremely cold winter month for the Project to operate, although at substantially reduced output. While not getting these communities completely off of diesel generation year round, the Project will be a significant first step for the area to reduce and eventually eliminate the use of fossil fuels. The Project will consist of:  Approximately 3 miles of single-lane access road from the highway to the diversion site. The clearing width for the road will generally be 40-50 feet, but may be somewhat wider in areas of significant ground slope due to the widths of cuts and fills. The right-of-way (ROW) width will be 100 feet to provide for minor field adjustment of the alignment if necessary. The road will cross Yerrick Creek at one location about 2 miles from the highway; the bridge will be about 200 feet long.  A diversion structure at about El 2220, just below the confluence of the main stem of Yerrick Creek and two tributaries. The diversion structure will include a concrete-faced rockfill dike on the west abutment, a concrete-faced rockfill spillway and roughened channel outlet in the central portion, and a concrete intake on the right abutment.  A buried pipeline approximately 15,000 feet in length (known as a penstock) using 42-inch HDPE pipe for the upper 55% and 36-inch ductile iron pipe for the lower 45%. The penstock will cross Yerrick Creek just above the bridge noted above; it will be buried below the stream channel and encased in concrete.  A powerhouse approximately 1,500 feet upstream of the Alaska Highway where the water will pass through a single turbine to the tailrace. Other powerhouse equipment will include the 1500 kW generator, controls and switchgear, bridge crane, and pad-mount transformer. The powerhouse structure will be a metal building set on a concrete foundation.  A tailrace consisting of a pond and 800 feet of excavated canal to an existing overflow channel of Yerrick Creek. The pond will be formed in a borrow pit excavated to provide fill material for the access road. The pond is expected to develop a stable ice cover in winter that will allow the turbine to discharge without glaciering.  A transmission line consisting of 1,500 feet of 12.4 kV underground transmission cable from the powerhouse to the highway and 10 miles of upgraded 12.4 kV overhead transmission line adjacent to the highway (see Figure 3), Based on the hydrology studies conducted to date (see Appendix 9.2), AP&T has selected a hydraulic capacity for the Project at 60 cfs, which will provide a generating capacity of 1,500 kW. The streamflow will only exceed the hydraulic capacity during the early summer (typically June and July), or about 10%-20% of the year. This is a relatively low exceedence level for a run-of-river project, but AP&T believes the high capacity is Page | 4 worthwhile because of the high cost of diesel generation. Before pipe and generating equipment is ordered, AP&T will reevaluate the hydraulic capacity. It could be reduced to perhaps 50 cfs, which would allow a reduction in the penstock diameter from about 42 inches to 36 inches. The environmental impacts would be virtually the same with a smaller capacity, therefore the conclusions of this EA would not change. During times of high flow, water will flow over the diversion structure. If the overflow is less than about 30 cfs, it will all pass through the roughened channel outlet to allow fish passage. At higher rates of overflow, water will also pass over the spillway. The duration of this overflow will be intermittent, and of course will vary with the amount of snow accumulated in the basin; during low runoff years there may be only a very short period of overflow, but during high runoff years the overflow period may start in June and extend into August. Figure 3: Transmission Line Features The proposed Project requires state and federal permitting prior to project commencement of construction. The permits needed are: (1) a Department of Natural Resource (DNR) land lease permit; (2) DNR water rights permit; (3) Department of Fish & Game (ADF&G) habitat permit; and, (4) a U.S. Army Corp of Engineers permit. In addition, besides being on State of Alaska managed lands, this project is also on Tanacross, Inc. lands (private), which is a Native corporation. The diversion structure and approximately 7,000 feet of the penstock and access road will be on state land, the remainder of the penstock and access road as well as the powerhouse and buried portion of the transmission line will be on private land. The size of easement needed on state land will be approximately 28.4 acres. The size of easement needed on private land will be approximately 27.7 acres. Page | 5 3 PURPOSE/NEED FOR PROPOSED ACTION  The purpose of this hydroelectric project is to reduce the use of fossil fuels presently used for generating electricity in the Tok area along the Alaska Highway. The communities that will benefit from this project are Tetlin (pop. 117), Tanacross (pop. 140), Dot Lake (pop. 19), and Tok (pop. 1,393), Alaska. These communities are presently 100% reliant upon fossil fuels for their electricity. AP&T applied to the RUS for a grant for a 2.0 MW run-of- river hydroelectric project that would connect directly to the AP&T transmission system that is centralized out of Tok where diesel generation facilities are located. Based on further hydrologic analysis, the facility is currently being designed with a 1.5 MW capacity. AP&T presently sells power for $0.47 per kWh (2009) in Tok and to other communities connected to Tok’s closed grid. The Proposed Action is needed to reduce this areas use of fossil fuels and to reduce price fluctuations and air emissions associated with diesel generation. To do this, a renewable energy resource is necessary. The proposed Project will be the first such project on this interior Alaska grid. Placing this hydroelectric project on the Tok grid will reduce electric rates to approximately $0.37 per kWh (~20% reduction). The current rate is above the RUS High Energy Cost Benchmark of Extremely High Average per unit energy costs ($0.239 per kWh), one of the eligibility criteria of this program. Two of the communities that would benefit from this project have large Native Alaskan populations, Tetlin 94.9%, Tanacross 88.6%. Page | 6 4 ALTERNATIVES   4.1 No Action  If no action is taken, the four communities that would benefit from the proposed Project would remain on diesel generation for their electrical needs. The price of diesel fluctuates and is expected to remain high, keeping the area’s electric rates high. Diesel generation also puts particulate matter and gases such as CO2 into the air, which are related to global warming. The high volume of diesel fuel needed for this small grid increases the likelihood of spills during transport and fueling operations as well as potential leaks from storage. The transport of hundreds of thousands of gallons of fuel each year relies on the burning of fossil fuels to transport fuel, which would continue. The high cost of electricity is a stress on residential customers, schools, and businesses, suppressing economic and population growth. The increasingly expensive electrical rates may drive people away from these communities. This economically impacted area on the Alaska Highway will continue to struggle with increases in the cost of diesel fuel. 4.2 Energy Generation Technologies Considered  Other energy generation technologies considered other than hydroelectric power were hydrokinetics, wind power, and woody biomass. A hydrokinetic project (the use of moving water to passively move a turbine placed in its flow) was evaluated for the Tanana River not far from Yerrick Creek. However, the environmental issues related to placing a turbine in this river appeared significant (possible impacts to fish, fishermen, boat traffic, subsistence use, testing of new technology, impact of floating debris). In addition, this type of technology is still being developed and tested. Hydrokinetic technology for a river turbine is presently not as efficient and the units are not very large, producing only a small amount of electricity. AP&T prefers to go with proven technology to get the best use of grant funds made available by RUS for renewable energy development as well as develop a larger project to meet more of the load. Wind power is still being evaluated for the area. AP&T is evaluating one or two sites that look promising, but their development could be years down the road. Wind generation requires consistent wind speeds above a base velocity rather than just being a windy area. This too is experimental technology at this northern latitude and is not known to be able to startup as fast as hydro from power outages when integrated with a diesel system. Conventional hydroelectric technology can start almost instantaneously, allowing supplemental diesel generation to be brought more slowly on line. Thus, conventional hydroelectric generation is more reliable in hybrid systems like the one being proposed. Biofuel is being considered by AP&T for the Tok grid. AP&T has been considering the possibility of a 2.0 MW-sized biomass facility using wood from the local area; however, funding was not made available to AP&T by the State of Alaska in its recent grant funding for Renewable Energy Fund Round III. This option will not be pursued in the near term unless grant funding becomes available. In order to get the communities on the Tok grid off of diesel generation, it will require a combination of renewable energy projects. However, biofuel is also less reliable than conventional hydroelectric power in that wood Page | 7 would have to be purchased and would therefore be dependent on a reliable and available source. Conventional hydroelectric power is a mature technology that is well proven. The components are readily available, and the science of finding a good site is well established. Yerrick Creek meets the requirements for a sustainable run-of-river (no storage) hydroelectric project due to relatively consistent flow throughout the year, no significant environmental issues, and no major engineering challenges. All of these contribute to keeping costs down. Hydroelectric projects also have the advantage of quick start-up time after a power outage, which is almost instantly. Hydroelectric power also integrates well with diesel generation units, making the balance between the two easy to manage. The other technologies that were considered either do not work well with quick start-ups or are relatively unproven, however, hydroelectric projects integrate well with other renewable energy projects, such as wind, because generation can be well regulated where as most other renewable energy technologies do not have consistent energy production. 4.3 Alternative Locations for siting the hydroelectric facility  Other watersheds considered by AP&T for conventional hydroelectric included:  Cathedral Rapids Creek No. 1, just west of Yerrick Creek, o does not have as large a drainage area as Yerrick Creek o does not have enough flow year round, and o does not have the easy accessibility of Yerrick Creek.  Tanana River o many environmental issues, particularly fish passage and sediment buildup o significantly greater costs to construct a project on a river versus a creek AP&T’s transmission grid passes by Yerrick Creek allowing the project to plug into the existing infrastructure, whereas other potential sites would require new transmission infrastructure because they were further away, which would lead to an increase in project costs and introduce new environmental impacts. Page | 8 5 AFFECTED ENVIRONMENT  5.1 Land Use  Approximately 50% of the proposed Project is located on state managed land, and the remainder is on property privately owned by Tanacross, Inc. The portion of the Yerrick Creek basin on which the Project would be located is used by hunters for bear, moose, caribou, and Dall sheep. Trapping for small furbearers also takes place. The site is used for a combination of subsistence and recreational activities, which is typical of the general area. Trespassing for hunting and/or trapping purposes is a concern of Tanacross, Inc., the private landowner. This sort of activity is not unusual in rural Alaska, which resembles an open range without fencing. Development of this project would provide easier access into both Tanacross, Inc. and state lands. AP&T is considering reasonable solutions to prevent vehicular access, such as installing a locked gate at the access road’s entrance point. AP&T is also willing to compensate Tanacross, Inc. for the use of its land and to mitigate the effects of trespassing and loss of land. While subsistence and recreational hunters and trappers will have easier foot access to a part of this area, wildlife hunting would remain heavily controlled and monitored by state and federal agencies that permit the amount of take allowed in the area. Therefore, although hunting is allowed in this area, a permit is necessary to harvest, and only a certain number of each species is allowed to be taken annually. This may provide some restraint for illegal use of this area. 5.2 Cultural Resources and Historic Properties  Under the provisions of the Archaeological Resources Protection Act, archeological site- location information is confidential; disclosure of such information is exempt from requests under federal and state freedom of information laws. The following reports are not public documents. They are intended for release to Alaska Power & Telephone (AP&T), the Rural Utilities Service (RUS), the Alaska State Historic Preservation Office (SHPO), Tanacross, Inc., and other consulting parties under Section 106 of the National Historic Preservation Act. Prior to initiating consultation with consulting parties under Section 106 of the National Historic Preservation Act (Section 106), AP&T gathered information about historic properties in the general project area. On July 9, 2008, AP&T submitted a letter the Alaska State Historic Preservation Office (SHPO), which included a copy of a literature review and preliminary recommendations for additional archaeological and historic structure surveys. The Alaska SHPO responded on August 15, 2008, that it agreed with the recommendations of the report, specifically the letter stated that additional archaeological surveys should be completed for the proposed access route, powerhouse site, and penstock route and that surveys should not be needed for the impoundment area. Based on this recommendation, RUS determined that the area of potential effect (APE) would be the proposed locations for the access road, powerhouse site, and penstock. Page | 9 By letter dated October 14, 2008, RUS formally initiated consultation with the Alaska SHPO and government-to-government consultation with the Native Village of Tanacross, Tanacross, Inc., the Native Village of Tetlin, and the Village of Dot Lake. The letter identified the project’s APE, requested that additional information be provided about historic properties within the APE, and requested the participation of consulting parties (Alaska SHPO, the Native Village of Tanacross, Tanacross, Inc., the Native Village of Tetlin, and the Village of Dot Lake) in a teleconference on November 13, 2008. The purpose of this teleconference was to give a more detailed description of the project, discuss known historic properties that may be within the APE, and discuss the predicted progression of this project under Section 106. On November 10, 2008, Tanacross, Inc., provided comments in response to RUS’s letter. Comments included:  A significant portion of the project (approximately one half of the penstock route, construction and maintenance roads, and all of the powerhouse site & its auxiliary facilities [access road and transmission infrastructure]) would be located on lands owned and managed by Tanacross, Inc.  The project would conflict with use of historic trails by members of the Native Village of Tanacross for subsistence purposes.  The project would interfere with right-of-way development by Denali-The Alaska Gas Pipeline LLC (Denali) for the transportation of North Slope natural gas to market. The proposed location of the powerhouse would be at the same location of Denali’s proposed compressor station. Several of these concerns were addressed during the teleconference held on November 10, 2008. Meeting minutes and a formal response to Tanacross, Inc.’s letter were submitted via email to participants of the teleconference on December 17, 2008. Representatives from the Native Village of Tanacross, Tanacross, Inc., the Native Village of Tetlin, and the Village of Dot Lake participated in the teleconference. Minutes from this meeting are included in Appendix 9.1 – Project Correspondence. Following the discussion, Tanacross, Inc., identified a historic trail used by members of Tanacross for subsistence purposes that may be within the APE of this Project. By letter dated, December 17, 2008, RUS requested that site-specific locations of the trail be identified. To date, this information has not been submitted to RUS for review. Following the teleconference, RUS authorized AP&T to begin surveys of the APE, provided it acquired the necessary permissions from Tanacross, Inc., to access its land. In 2009, AP&T hired Northern Land Use Research, Inc. (NLUR) to conduct a cultural resource survey of the APE. The survey identified the following sites within the APE:  TNX-156: Tanacross quadrangle segment of the Haines-Fairbanks pipeline  TNX-074: Yerrick Creek cabin  TNX-211: Can Dump area  TNX-212: Construction camp site When designing this project, AP&T treated all of these sites as eligible for inclusion in the National Register of Historic Properties, although RUS, with SHPO concurrence) have Page | 10 determined that site TNX-211 is ineligible.2 The historic trail, identified by Tanacross, Inc., was not found within the APE. 5.3 Biological Resources  Yerrick Creek is located within the Yukon/Tanana uplands physiographic province (Warhafting 1965). The climate of this area is continental with average annual temperatures ranging between -32°F and 72°F, and extreme temperatures have been measured from -60 to 99°F (ADCED 2004). The Tanana Valley is bound by low, rounded hills ranging in elevation from 300 meters to 1,500 meters (1,000 to 5,000 feet) above sea level, that are interspersed with lowland bog areas and depressions. Wildlife resources within Upper Tanana region include large game, such as moose, caribou and Dall sheep, and furbearers, such as snowshoe hare, muskrat and red squirrels (Halpin 1987). Aquatic resources include occasional whitefish, arctic grayling, and Dolly Varden, while avian resources include geese, ptarmigan, ducks and grouse. A literature search indicates that these species exist in the Yerrick Creek area. The Alaska Range lines the southern horizon of the project area beyond the low-lying hills. The higher relief hills are typically igneous intrusions that sometimes have extensive rock exposures and shallow soil deposition, whereas the lowlands are often characterized by vegetated loess dunes and thick organic layers covering permafrost. The area surrounding the Tanana River is dotted with lowland lakes and small creeks. Yerrick Creek flows north from the Alaska Range before joining the Tanana River. Yerrick Creek is a cascading stream with fast flow with some “islands” of vegetation present in the channel, but for the most part the channel consists of braided sand, gravel, and cobble bars with some large boulders. Old meander channels and lower elevation vegetated creek banks exhibit signs of recent and past vegetation log jams from spring break up. Vegetation in the project area consists of an upland spruce-hardwood forest. Dominant trees include black and white spruce, paper birch, quaking aspen and cottonwood. Willow and alder shrubs are also present in recently disturbed areas. Understory shrubs include dwarf birch, wild rose, Labrador tea, high bush cranberry and raspberry. The dominant forest ground cover noted include toad flax, bog and low bush cranberry, Sphagnum moss, lichens, blue joint grasses and horsetail. Initially, AP&T submitted a Draft Study Plan to the resource agencies to determine what studies were needed and what information was lacking in their biological analysis of the site. Based on comments received from ADF&G on September 3, 2008, the study of mammals was not necessary because there was significant information already available on agency websites, which was included in AP&T’s Study Plan. Fish species, plant surveys, and a wetland determination, however, were conducted. 5.3.1 Fish Resources  For most of its length, Yerrick Creek is a cascading stream with fast flow and boulder substrate. The stream generally comprises one to three channels, within a wide dynamic 2 March 24, 2010, letter from SHPO to RUS. Page | 11 (scoured) perimeter. Apparent fish habitat consists of widely spaced, very small (~10-foot long) pools behind large boulders or logjams. Roughly one mile before the creek joins the Tanana River, the habitat is significantly different; flow is much slower and the habitat is composed mostly of sand. In this “delta” area, there are three main channels with several smaller channels which leave and rejoin the larger channels, and at least one large area (“city block” in size) through which the creek flows more-or-less overland, in very shallow channels among dense spruce trees. In between these two reaches is a transition zone, where flow is intermediate in strength and substrate is small rocks and large gravel. This transition zone is only a few hundred yards long. Complicating this situation is the fact that the surface water flowing in the creek is not always continuous within the river. Because of the porous substrate, the water sometimes disappears from the surface and flows underground. Fish surveys were conducted by a qualified fish biologist, Stephen Grabacki (Anchorage), who conducted surveys in 2008 on September 3-4 and 29-30 and in 2009 on May 19-20, May 27-29, and June 7. A report on the fish surveys can be found in Appendix 9.3.1 – Fish Resource Report. Mr. Grabacki stated, “The stream bed morphology indicates that even when there is surface flow, the quality of the habitat is limited and the larger rock moved during the high flow periods reduces the quality of fish habitat.” Based on sampling in early September 2008, and on the three sampling sessions in May- June 2009, an understanding of Dolly Varden (Salvelinus malma) and Arctic grayling (Thymallus arcticus) use of Yerrick Creek seems to have emerged. Grayling appear to use parts of Yerrick Creek (below and within the bypass reach) for summer feeding, on an opportunistic basis. No evidence was found to support that grayling spawn in Yerrick Creek:  The creek did not connect to the river at the expected time of grayling spawning  No aggregations were observed of grayling anywhere in Yerrick Creek; all grayling observed in the creek in May-June 2009 appeared to be individual fish  No adult-size grayling were observed, and the largest grayling observed in June 2009 (a 2- or 3-year-old) did not appear to be in either a pre-spawning or post- spawning condition. Studies conducted showed that the majority of Dolly Varden (DV) year-round habitat is above the diversion site. During a May 2009 meeting between ADF&G and AP&T, ADF&G acknowledged that this Project would not significantly impact DV (it was at this time AP&T was directed to focus on studying Grayling use of the creek). Studies confirmed that there is little over-wintering refugia in the bypass portion of the creek so that any loss of over-wintering refugia will have minimal impact to DV. 5.3.2 Wildlife (mammal) Review  Wildlife is not expected to be significantly impacted by the proposed Project, either by construction or operation. Species that use the proposed Project area are not considered threatened, endangered, or listed species of concern (TES). A literature search conducted by AP&T does not point to any TES using this basin, although some may occasionally pass through during migration. Of the many species that do use the Yerrick Creek area, Game Page | 12 Management Unit 12, some are hunted for their meat (moose, caribou, Dall sheep, black and brown bear) and trapped for their pelts (lynx and marten), or harvested because they kill other preferred game, i.e., wolves. There will be a minimal loss of habitat types from project features:  The powerhouse, staging area, and lower borrow area are near the Alaska Highway and a total of approximately 5.2 acres will be cleared.  The tailrace will require clearing approximately 0.6 acres.  The access road/penstock route will require approximately 38.7 acres of clearing.  The upper borrow area will require approximately 2.5 acres, however this is mostly exposed bedrock.  The upper staging area will require approximately 5.7 acres of clearing, but will be allowed to revegetate after construction.  The diversion area covers 3.4 acres, but little of this has vegetation. The habitat type for the project area is typically open paper birch – white spruce forest. Open balsam poplar–white spruce forest and open white spruce forest habitats are found in drier portions of the Project area. Open black spruce forest and open dwarf black spruce forest occupy areas with poorly drained soils. Closed tall alder or willow scrub occupies the transitional areas between forested areas and creek channel. This habitat type is common throughout this drainage basin as well as other drainages along the Tanana River that Yerrick Creek drains into. ADF&G in a July 1, 2008, letter to AP&T, requested that the penstock and access road remain a minimum of 66 feet from the creek accept when intersecting with the diversion structure or powerhouse; however, it is necessary to cross the creek due to perma frost, wetlands, and steep slopes found further south on the west side of the creek. A single-lane bridge would be used to cross the creek and the penstock would be buried under the creek to avoid damage from flooding that occurs in this wide, dynamic creek. The penstock (pipe) would be passable to wildlife because it will be buried along the access road. This Project is viewed as having limited impacts to wildlife in the area. The main concern would be whether this project will provide easier vehicular access into this basin for hunters and trappers, which could place more pressure on wildlife. However, in regards to increased hunting pressure, sport and subsistence hunting go hand- in-hand in this area, although most is by Alaskan hunters and is therefore most likely for subsistence. All hunting is controlled by permit in this area and there is a limit to how many of each species can be harvested in a given year. This places a control on harvesting these species regardless of whether there is improved access to this drainage or not. Big game that use Game Management Unit 12 are black and brown bear, moose, and possibly migrating caribou. Dall sheep most likely stay at higher elevations. Wolves probably migrate through looking for game. Roads in remote areas with little traffic often become travel corridors for the wildlife using the area (AP&Ts experience from other projects), which simply makes it easier for them to get around. However, the Yerrick Creek forest is primarily open, possibly reducing use of the road by wildlife. Although this project will remove habitat, the loss is not significant because the amount of land is small in comparison with the surrounding undeveloped area. Page | 13 Dall sheep hunting is controlled by a drawing for a permit, only so many permits are allowed, so increased access should have little impact to this species because only so many can be legally harvested. Of the participating hunters, 94% were Alaska residents in regulatory years (RY) 2001-2003, of which 92% of the harvested rams were by Alaskans.3 For Macomb caribou, a permit is required as well with a harvest limit of one bull per year (only for residents). Only one Macomb caribou was harvested in Unit 12 in RY2001-2002 and RY2002-2003. Highway vehicle followed by horse are the dominant methods to hunt Macomb caribou in recent years.4 Brown bears are distributed throughout Unit 12. Unit 12 brown bear hunting regulations were liberalized in 1981 to reduce the bear population and elevate moose calf survival. "In 1994, the Unit 12 brown bear management goal to reduce the brown bear population to increase moose calf survival was eliminated and the management goal was revised to provide for maximum opportunity to hunt brown bears in Unit 12. The management goal has remained the same since 1994."5 Presently, only one brown bear per permit per regulatory year is allowed to be harvested. During RY 04 & 05, non-residents of Alaska accounted for 65% and 75% of the harvest respectively. For black bear, three bears per permit per regulatory year can be harvested. Alaska residents accounted for 89-93% of the black bears harvested during RY98-RY00. Yerrick Creek does not contain a reliable source of fish in the project area (diversion to the powerhouse) to attract bears to feed. Other streams along the Tanana River have better runs of grayling and Dolly Varden as well as other salmonid species. Regarding moose, "Predation by wolves and grizzly bears has likely been the greatest source of mortality for moose in Unit 12 and has likely been the major factor keeping the population at a low density since the mid 1970s. In contrast to most other areas that contain sympatric moose, wolf, and grizzly bear populations, wolves, rather than bears, appeared to be the primary predator on moose calves on the Northway-Tetlin Flats, based on research conducted during the late 1980s (ADF&G, unpublished data; U.S. Fish and Wildlife Service, unpublished data). Wolf predation also appeared to be the greatest source of adult mortality. However, in some mountainous areas of Unit 12, fall composition data indicate that predation on moose neonates was high, suggesting grizzly bear predation."6 Hunters using 3 or 4 wheelers accounted for the highest percentage of the harvest with highway vehicles next. Predation by wolves and bears shows that other natural processes have a far greater impact on moose than humans. Only one bull can be harvested per year per permit. 3 Parker McNeill D.I. 2005. Portions of Units 12, 13C, and 20D Dall sheep management report. Pages 68-79 in C. Brown, editor. Dall sheep management report of survey and inventory activities 1 July 2001-30 June 2004. Alaska Department of Fish and Game. Project 6.0. Juneau, Alaska. 4 DuBois, S. D. 2007. Units 12 and 20D caribou. Pages 65-82 in P. Harper, editor. Caribou management report of survey and inventory activities 1 July 2004-30 June 2006. Alaska Department of Fish and Game. Project 3.0. Juneau, Alaska, USA. 5 Gross, J. A. 2007. Unit 12 brown bear. Pages 132-142 in P. Harper, editor. Brown bear management report of survey and inventory activities 1 July 2004-30 June 2006. Alaska Department of Fish and Game. Project 4.0. Juneau, Alaska, USA. 6 Hollis, A. L. 2006. Unit 12 moose. Pages 126-143 in P. Harper, editor. Moose management report of survey and inventory actitivies 1 July 2003-30 June 2005. Alaska Department of Fish and Game. Project 1.0. Juneau, Alaska, USA. Page | 14 Up to five wolves can be harvest per year in Game Management Unit 12. Management of these species with state harvest limits is what controls the human take of these species. Putting a road into the Yerrick Creek drainage to reach the diversion site may provide easier access by hunters, but all these species require permits to harvest. The harvest total for the management unit is based on what the populations can tolerate. This short road into Yerrick Creek will not change management of these species, even if it makes it easier to get into this area. Avian species are not expected to be significantly impacted due to the limited nature of the clearing needed (15 feet wide for access road / penstock route) although there could be some loss of habitat. 5.3.3 TES botanical survey  A threatened, endangered, and sensitive (TES) plant species survey was conducted within the Yerrick Creek Hydroelectric project area by a qualified botanist of HDR, Inc., Anchorage. The purpose of the study was to determine if there were any individuals or populations of plant species of interest that may be affected by project activities. The survey was conducted at Level 5 intensity. Most of the project area is undeveloped with an open gravel waterway, islands of mixed hardwood and softwood trees, abandoned gravel side channels in various states of revegetation, and heavily forested banks. The main vegetation of Yerrick Creek study area is typically open paper birch – white spruce forest. Open balsam poplar–white spruce forest and open white spruce forest inhabits drier sites. Open black spruce forest and open dwarf black spruce forest occupy areas with poorly drained soils. Closed tall alder or willow scrub occupies the transitional areas between forested areas and creek channel. Narrow areas of gravel floodplain areas along Yerrick Creek are inhabited by early seral graminoids and forbs. Bluejoint meadows and lowland sedge wet meadows occupy wet areas adjacent to ponds. The HDR project botanist surveyed most of the major vegetation types, and covered much of the geographic extent of the Yerrick Creek project area. The majority of collection locations were concentrated on gravel river bars and shrub areas adjacent to the Yerrick Creek. More than 100 vouchers were collected. Specimens were given provisional names in the field and later sorted, examined and identified by the HDR botanist. Specimens of notable taxa will be sent to the UAF Herbarium (ALA) for review by the museum staff. Most of these species are widespread in interior Alaska. No non-native species were observed in the Yerrick Creek study area. In total, 145 species from 40 families were recorded at the area. The complete list of species encountered in Yerrick Creek study area is found in Appendix 9.3.2 – TES Plant Report. Two lakes were visited. Aquatic plants were observed and recorded from the shore. The study area was not surveyed for aquatic plants specifically. Four notable plants were found in the project area. The AKNHP tracks populations of plants of interest. Notable plants are not considered rare, sensitive, or endangered but are considered to be of ecological interest by the AKNHP. Page | 15 Phlox sibirica (Siberian phlox) was not previously reported from the area. The closest records of this plant are approximately (UAF 2008): 1. 30 miles NW of Yerrick Creek in Fort Greely Military Reservation in 2004 (63.78°, -145.79°) 2. 45 miles SE of Yerrick Creek at Wrangell-St. Elias National Park and Preserve (62.20266°, -142.123273°) Other notable plants, for which there are no nearby records, include: 1. Botrychium lunaria (common moonwort) 2. Platanthera obtusata (blunt-leaved orchid) 3. Astragalus robbinsii ssp. harringtonii (Harold’s milkvetch) The TES plant survey found no globally or state ranked Rare or Sensitive species during the survey. No Endangered species were encountered or identified during the survey. The only plant federally listed or proposed by the U.S. Fish and Wildlife Service in Alaska is Polystichum aleuticum C. Christensen, which is endangered. It is only known from Adak Island and is not expected to occur in the proposed Project area. Most plant species observed in the area are considered common and widespread in interior Alaska. 5.4 Water Quality & Quantity  5.4.1 Water Quality  A water quality survey was conducted by Travis/Pederson Environmental Consulting, Inc., Fairbanks, using past (USGS 15476000) and present information to complete an analysis (report can be found in Appendix 9.3.3. – Literature Review and Field Report: Hydrology Baseline Study). The findings from the water quality study is that Yerrick Creek is a clear, oligotrophic (low nutrient levels) and well oxygenated stream. The moderately high pH for surface water suggests contact with some kind of carbonate rock within the drainage. High flushing flows occur on almost an annual basis, scouring and moving the cobble within the creek banks. 5.4.2 Water Quantity  AP&T’s initial assessment of the water quantities in Yerrick Creek (Berkshire, 2007) were based on transposition of the record of the USGS gage on Berry Creek some 33 miles west of Yerrick Creek, with adjustment for the drainage areas of the two streams. AP&T installed a stream gage on Yerrick Creek near the diversion site in June 2007. In July 2008, the gage installation was washed out by flooding. The gage was subsequently moved upstream a few hundred feet to a more protected location, but equipment malfunctions prevented collection of data until the spring of 2009. As with all stream gages in interior Alaska, the gage installation is subject to ice influence, and flows in the winter can only be estimated. AP&T has attempted to correlate the small amount of data from the Yerrick Creek gage with contemporaneous data from USGS gages in the area. Unfortunately, there are no contemporaneous USGS gages with similar characteristics (basin size, elevation, annual precipitation); available USGS gages are as follows: Page | 16  Phelan Creek near Paxton - - 12.2 mi2 drainage area, mostly glaciated.  Goodpaster River near Big Delta - - 677 mi2 drainage area, lower and flatter topography  Yukon River near Eagle - - 113,500 mi2 drainage area Correlations between the data from AP&T’s gage and that from the USGS gages are only fair, with correlation coefficients (R2) between 0.79 and 0.85. Based on the flow data collected to date and the correlations with the USGS gage data, it appears that Yerrick Creek has a higher base flow than might be expected. Even in the winter, AP&T has always found water flowing under the ice at the gage location. AP&T theorizes that this is because of the large amount of alluvium in the valley. AP&T will continue to measure Yerrick Creek flows to develop more reliable streamflow correlations. In 2010, AP&T contracted for another review of the hydrology information for the site (Environ Corp., 2010). For that study, a double correlation was attempted between Berry Creek, the Yukon River, and Yerrick Creek. The study determines likely upper and lower limits for Yerrick Creek flows. 5.5 Floodplains/Wetlands  A wetlands jurisdictional determination was conducted by HDR, Inc. (Appendix 9.3.4 – Preliminary Jurisdictional Determination). Most of the proposed Project area is undeveloped, with an open gravel waterway, adjacent forests, abandoned gravel side channels in various states of re-vegetation, and heavily forested banks. The creek corridor is the only floodplain, and the project features that will be within the floodplain are the diversion structure and a small portion of the penstock. Besides the creek, there are small and large ponds on the ridges above the creek to the west as well as hydric soils and permafrost scattered about. A significant portion of the soils are not hydric and are well drained. Conclusions from the wetland delineation were: at wetland data from locations, 15 out of the 28 sites had hydrophytic vegetation. The most common trees in the project area include white spruce (Picea glauca), balsam poplar (Populus balsamifera), and some paper birch (Betula papyrifera). The most common shrub is alder (Alnus crispa). Saplings of white spruce and cottonwood are also common in the shrub layer. Common graminoids include bluejoint reedgrass (Calamagrostis canadensis) and a variety of sedges (Carex spp.). Common forbs include timberberry (Geocaulon lividum) and dwarf fireweed (Chamerion latifolium). Mosses and lichens were found primarily in forested plots. Wetland locations are based upon the dominance of hydrophytic vegetation, hydrologic indicators, and hydric soil indicators. Other waters of the U.S. are based on the investigators’ judgement about the location of the ordinary high water mark of Yerrick Creek. Based on the findings above, approximately 21.3% (147.1 acres), a conservative delineation, of the mapped acres were determined to meet the USACOE requirements for being classified as wetlands or other waters. Most of the mapped wetland areas are not within the proposed project construction areas. Page | 17 The remainder of the mapped project area, approximately 78.7% (542.6 acres) of the mapped area, lacks one or more of the required three parameters to support classifying an area as wetland and is not below the plane of the ordinary high water (OHW) mark of Yerrick Creek. These areas would not be subject to jurisdiction under Section 404 of the Clean Water Act. Yerrick Creek and its adjacent active bars are waters of the U.S. below the creek’s OHW mark. OHW is particularly difficult to define for a braided channel such as this one. There may be some areas within the river bars that are not actually below the OHW mark. 5.6 Environmental Justice  The communities that would benefit from the proposed Project are Tetlin (pop. 117; 94.9% is Native American), Tanacross (pop. 140; 88.6% is Native American), Dot Lake (pop. 19), and Tok (pop. 1,393; 12.8% is Native American), Alaska. The state’s percentage of Native Americans is 13.4%. According to the U.S. Census data, the county median household income was $38,776, which is 75% of the State median household income of $51,571. The per capita income for these communities is: Tetlin $7,372; Tanacross $9,429; Tok $18,521; and Dot Lake $19,406 compared to the State at $33,761. Family poverty levels are higher in Tetlin (40%), Tanacross (22.6%), and Tok (9.5%) than the State as a whole (6.7%). Unemployment in Tanacross is 57.1%, Tetlin 46.9%, and in Tok 18%.7 The Denali Commission’s 2009 Report on Distressed Communities in Alaska lists Dot Lake, Tetlin and Tanacross as distressed. Tok was last listed as a distressed community by the Denali Commission in their 2008 report. Based on the current state of the U.S. economy, it is likely that all four communities will be listed in 2010. The Denali Commission list of Distressed Communities can be found in Appendix 9.4 – 2009 Denali Commission List of Distressed Communities. 5.7 Socioeconomics  The present (2009) electric rates for AP&T customers in Tetlin, Tok, Tanacross and Dot Lake (a small, isolated grid) is approximately $0.47 per kWh. AP&T’s current diesel fuel consumption is approximately 350,000 gallons per year, which at today’s prices (the 2008 average was $3.577 per gallon) costs $1,252,000 annually. Over 50 years, AP&T’s diesel generation plant will use approximately 17,500,000 gallons of diesel. The existing diesel plant in Tok, which supplies electricity to all four communities, presently has six diesel generators to meet and act as backup for the load demand. The generators require significant labor and maintenance. The frequency of generator overhaul and replacement of these six units averages a cost of approximately $50,000 annually. These costs are passed on to customers via the electric rates. Many customers in AP&T’s service area supplement their electrical use with wood, kerosene, and oil or gas generators for heating because of the high cost of electricity. Several customers also use propane for cooking, clothes dryers, hot water heaters, etc. The economy along the Alaska Highway has suffered from high gas prices, the slowed national economy. This situation has impacted the local economy, which is reliant upon tourism for 7 Based on the 2000 U.S. Census Records Page | 18 its economic sustainability. As mentioned under Environmental Justice, Dot Lake, Tetlin, and Tanacross are on the 2009 Denali Commissions list of distressed communities, and have been so for years, with Tok last listed in 2008. The local school is seeking cheaper electric rates and is therefore looking at other technologies. A couple businesses have come through looking for sites to build manufacturing plants in the Tok area until they discovered how expensive the electricity is. Economic development is bleak for the area at this time. Page | 19 6 ENVIRONMENTAL CONSEQUENCES   6.1 Alternative 1: No – Action  If No Action is taken, the environment at Yerrick Creek would remain unchanged. There would be no diverting of flow out of the creek to be returned further downstream, having no impact on the limited fish habitat available in this area of the creek and therefore allow free movement by fish as currently exists. There would be no loss of terrestrial habitat from the clearing of the right-of-way for the access road and penstock route. Wildlife that uses the area would not be stressed by the activity of construction, possibly temporarily forcing them out of the area. There would be no possibility of human induced erosion or sedimentation to the creek. The No Action alternative would also mean the four communities that would benefit from this project will remain on diesel generation for their electrical needs. This will cause their electric rates to fluctuate with the price of diesel, which is expected to remain high keeping the area electric rates high. Diesel generation also puts particulate matter and gases such as CO2 into the air, which are related to global warming. The high volume of diesel fuel needed for this small grid increases the likelihood of spills during transport and fueling operations as well as potential leaks from storage. The transport of hundreds of thousands of gallons of fuel each year relies on the burning of fossil fuels, which would continue. The high cost of electricity would continue to stress residential customers, schools, and businesses, suppressing economic and residential growth. The increasingly expensive electrical rates may drive people from these communities. This economically impacted area on the Alaska Highway will continue to struggle with increases in the cost of diesel fuel. 6.2 Alternative 2: The Proposed Project  6.2.1 Land Use  Fall hunting, subsistence activity, and trapping would likely be temporarily impacted during the construction phase because wildlife would probably stay away during construction activity. Although, as usually happens at this type of construction activity, based on AP&Ts experience, if construction clearings cross a wildlife corridor the wildlife will continue to use it but may change the time of day they cross the area of activity. During the operations phase, impacts to hunting, subsistence activity, and trappers would be minor due to personnel surveillance of the proposed Project site for operation and maintenance. Building the access road into the diversion site will make access easier for hunters, possibly changing the land use by increasing, at minimum, the foot traffic into the basin and increasing pressure on wildlife. However, wildlife hunted in this state management unit (Unit 12) is managed by permits, which limits the number harvested per permit. This protects the mammals so that they are not harvested beyond what their population can tolerate. Therefore, any easier access into this area should not increase pressure on wildlife because only a certain number can be taken. Other pressure from increased access is just the intrusion or disturbance potentially caused by more recreational foot traffic or ATVs if they are able to access the project access road. Though use of the Page | 20 basin is likely to increase, this is not expected to be a significant impact as this is a remote part of Alaska, even being on the Alaska Highway. Overall, use of the project area for recreational purposes is likely to increase due to easier access, but impacts are not expected to be significant. The use of both state and private land for this project would be mitigated by paying fees for the use of the land. A gate which locks just off the highway will help limit access by vehicle to prevent illegal dumping. 6.2.2 Cultural Resources and Historic Properties  On January 13, 2010, RUS submitted a finding of effects letter to consulting parties (i.e., Alaska SHPO, Tanacross, Inc., Native Village of Tanacross, Native Village of Tetlin, and the Village of Dot Lake). In that letter, RUS included its determination of eligibility of sites identified in the November 2009 survey for inclusion in the National Register of Historic Places, which included sites: TNX-156 (Tanacross quadrangle segment of the Haines-Fairbanks pipeline), TNX-074 (Yerrick Creek cabin), TNX-211 (Can Dump area), and TNX-212 (Construction camp site). On March 24, 2010, the Alaska SHPO indicated that it considers TNX-212 a historic property. The Alaska SHPO stated that it has no objections with the current design of the proposed Project (i.e., the access road avoiding site TNX-212). SHPO requested that the boundaries of the site be marked as an avoidance area for construction crews. The Alaska SHPO concurred with RUS’s determination that monitoring at site TNX-212 would not be needed. To date, no letters from the other consulting parties have been received. 6.2.3 Biological Resources  No Threatened, Endangered, or Sensitive wildlife species are known to utilize the proposed Project area, although they may pass through it. Impacts would be temporary from construction activities causing wildlife to avoid the site during construction. No long term impacts are expected. No Threatened, Endangered, or Sensitive plant species were found to inhabit the site; therefore, no impacts are anticipated. Fish resources in the Project’s bypass reach will be minimally impacted because the existing quality of the habitat is currently poor. Dolly Varden in the creek primarily use habitat above the proposed Project area, and the Arctic grayling primarily use habitat below the proposed Project’s discharge point. There is no evidence that the Arctic grayling use the creek for spawning; but the species are opportunistic, they may enter the area to feed. The potential loss of the bypass reach as fish habitat during parts of the year when flow is low is not significant for the sustainability of these two species due to better habitat in other nearby streams in the Tanana River basin. ADF&G issued a permit on August 5, 2009, allowing the construction of this Project; however, they do request to see the intake and spillway designs prior to construction. As requested by ADF&G, AP&T plans to remain 66 feet away from the riparian corridor as much as practicable to reduce impacts of sedimentation into the creek. AP&T also Page | 21 proposes to implement erosion and sedimentation control methods to reduce this potential to a level of non-significance. AP&T also proposes to bury the penstock to prevent a barrier to wildlife passage through the project and to place the penstock within the access road corridor as much as possible to minimize vegetation clearing. ADF&G has indicated they agree with both these approaches. ADF&G requested in the habitat permit that an “excess flow bypass shall be constructed as a roughened channel that permits all flow in excess of 60 cfs to remain in the middle bypass reach and that provides fish passage, both upstream and downstream.” This creek is not considered Essential Fish Habitat. With the proposals made by AP&T, which are approved by ADF&G, this Project is not expected to have significant impacts to Biological Resources. 6.2.4 Water Quality & Quantity  Based on the water quality studies conducted, there are no chemical abnormalities that would warrant further investigation of the stream to be impacted by the hydroelectric project. With the erosion and sedimentation control methods AP&T proposes to employ (i.e. silt fencing, jut netting, seed mix using annual non-invasive species, using as narrow a corridor as possible, and use of riprap to stabilize slopes along with revegetation as needed) during and after construction of the proposed Project, water quality should be only minimally impacted as these methods will significantly reduce the opportunity for sedimentation. Construction within the creek will use cofferdams to divert flow around construction activity to minimize sedimentation. Cofferdams will likely be made from super-sacks 8 filled with sand. Therefore, the proposed Project should have no significant impacts to water quality. 6.2.5 Floodplains/Wetlands  The project will impact a floodplain (creek) by installing a diversion structure across the creek, which will remove flow of up to 60 cfs. This floodplain, or creek, is an open gravel waterway with abandoned gravel side channels in various states of re-vegetation with heavily forested and steep banks. Construction of the diversion and removal of up to 60 cfs would remove most water flow between the diversion and the Project’s tailrace; however, this would have minimal environmental impacts to this floodplain due to a lack of vegetation and poor fish habitat to support. Based on the flow data collected to date and in correlation with other nearby gaged streams, during a typical year flows greater than 60 cfs will occur only in early summer (June and July). During times of high flow, water will flow over the diversion structure and continue down the creek. The duration of this spill flow will be intermittent, and will vary with the amount of snow accumulated in the basin. During low runoff years, there may be only a very short period of spill, but during high runoff years the spill period may start in June and extend through August. The Yerrick Creek channel routinely experiences peak flows over 1000 cfs (based on regional parameters, the two-year flood is estimated at 1,102 cfs and the five-year flood is estimated at 1,575 cfs). This Project will reduce flood flows below the diversion structure, however, the 60 cfs reduction is not considered significant compared to the high peak flows. The diversion structure will be constructed with a relatively flat upstream concrete 8 Large nylon-fabric sacks (very strong) meant to perform like conventional sandbags, only larger. Page | 22 face (4H:1V) to allow movement of bedload and sediment downstream during floods. Nevertheless, accumulation of sediment in the diversion pond is expected, and will require periodic removal and placement in the downstream floodplain to maintain the existing sediment movement regime. There will be minimal impacts to the Yerrick Creek floodplain caused by Project construction or operation because high flows that exceed 60 cfs occur annually. Outside of the creek floodplain, there will be few if any impacts to wetlands because the Project utilizes uplands, thereby avoiding impacting wetlands along the access road/penstock route. The wetland survey conducted found that there were approximately 21% wetlands within the project boundary (including hydric soils), though not necessarily where the project features will be located. In fact, the final design specifically avoids wetlands along the access road/penstock route until meeting the creek where it is spanned by a single-lane bridge. AP&T proposes to mitigate potential impacts to wetlands by using silt fencing to prevent runoff from disturbed soils and revegetation with grass seed mixes, which will help stabilize disturbed soils. AP&T also proposes to confine construction activity to as narrow a footprint as possible, which will also reduce impacts. 6.2.6 Environmental Justice    This project would not disproportionately affect low income or minority communities in the proposed Project area. This Project, however, will improve conditions for these small communities by saving the customers money and potentially attracting industry or other commercial endeavors, which would provide employment to the area. Part of the Project is located on the Tribal Corporation, Tanacross, Inc., lands that AP&T will pay compensatory fees to use. 6.2.7 Socioeconomics   The proposed Project would provide rate stabilization and lower rates, which may attract more residents and commercial operations to any and all the communities this Project would serve. This Project may have a byproduct of providing more local employment in this economically distressed area. Having stabile rates could impact demographics as mentioned above and if the economy continues to decline, there will still be a need for less expensive and clean power. This project will reduce the noise and air pollution associated with diesel generation facilities which are located within city limits and will increase public safety by reducing the use of diesel fuel. This project will partially displace the use of diesel and diesel fuel sellers by reducing the amount AP&T purchases. Page | 23 7 MITAGATION AND PERMITS  Mitigation measures that would be implemented in the construction and operation of the proposed Project include: General  Diversion should have an excess flow bypass when flows exceed the hydraulic capacity of the project (60 cfs) as a roughened channel to provide fish passage in both directions.  Fish exclusion configuration at intake to prevent their injury or mortality; screen openings would not exceed ¼ inch.  The access road and penstock will remain a minimum of 66 feet from the riparian zone along the creek except where access is needed to the diversion structure, the bridge crossing, and powerhouse, or unless otherwise necessary.  The penstock will be buried as much as possible to allow wildlife passage.  Project clearing will be kept to a minimum to reduce potential impacts to wildlife.  The boundaries of site TNX-212 will be marked as recommended by SHPO. Construction crews will be notified of this avoidance area.  Silt fencing will be used to contain runoff and prevent sedimentation.  Grass seed mix, jut netting, and/or riprap will be used to stabilize disturbed soils after construction activity has ceased in an area. ADF&G issued a habitat permit for construction on August 5, 2009, with the following stipulations that AP&T would implement:  Prior to construction, civil plans for construction of the impoundment dam and excess flow bypass shall be submitted to ADF&G for review and approval.  The excess flow bypass shall be constructed as a roughened channel that permits all flow in excess of 60 cfs to remain in the middle bypass reach and that provides fish passage, both upstream and downstream.  Prior to construction, plans shall be submitted to provide for fish exclusion at the penstock intake. These plans must provide for an effective screen opening that does not exceed ¼ inch. USACOE issued a Department of Army (DA) permit for construction on April 30, 2010, [POA-2009-445] with the following stipulations that AP&T would implement:  All fill slopes and disturbed areas subject to erosion and siltation of Yerrick Creek or project area wetlands shall be stabilized against erosion by revegetation either by seeding and/or transplanting species native to the immediate area. Erosion control with materials such as coir logs, straw wattles, silt fencing, fiber biodegradable mats, straw mulch etc. must be used as best management practices.  Migratory birds, their nests, eggs, nestlings, etc. will not be taken (disturbed in any manner). Vegetation must not be cleared between 5 May and 25 July of any year, unless the area to be cleared has been surveyed for birds and their nests, by a qualified biologist, and the land clearing or human disturbances can be conducted without a take. Page | 24  Yerrick Creek bed and banks disturbed by construction of temporary diversion channels, cofferdams, bridges, or other disturbances must be restored to original conditions upon removal of the temporary fills or structures.  No equipment or machinery shall be refueled, lubricated, or maintained while in any active or inactive channels of Yerrick Creek. All debris will be cleaned from work areas authorized by this permit immediately following construction.  Earthen materials shall not be stockpiled adjacent to Yerrick Creek to prevent erosion and siltation of creek waters.  Trenching of Yerrick Creek for installation of the penstock crossing shall not occur within any flowing or open waters. The diversion must result in a dry work area. The creek bed must be restored with the large cobble rocks existing in the channel for armor protections prior to diverting the creek waters back to the original channel over the buried penstock. The creek bed and banks shall have the original elevation and contours re-established.  Reasonable precautions and controls must be used to prevent incidental and accidental discharge of petroleum products or other hazardous substances into any water or wetland areas. Clean-up materials shall be available on-site and used immediately to contain any spills of such pollutants. Fuel storage and handling must not be conducted in Yerrick Creek or wetland areas. Equipment leaking fuel, oil, hydraulic oil, etc. must not be operated in aquatic areas and be repaired prior to use in or near Yerrick Creek.  As compensatory mitigation for the permanent net loss of approximately 0.8 acre of Yerrick Creek area, the permittee shall pay an in-lieu fee to The Conservation Fund, or other Corps’ In-lieu Fee Program sponsor, prior to initiating construction in waters of the U.S., at the ratio of 1 acre of creek to 1.5 acre preserved. The Conservation Fund will provide the cost per debit to the permittee at the time of payment. Proof of the in-lieu fee payment shall be provided to the Corps prior to beginning construction in the waters of Yerrick Creek. The issuance of following permits are pending:  DNR Land Use Permit  DNR Water Rights Permit AP&T is committed to implementing all environmental stipulations associated with the issuance of these permits. Page | 25   8 LITERATURE CITED  ADF&G, FH-09-III-0182 Permit issued for Construction, R. F. McLean, August 5, 2009. Alaska Power & Telephone Co., AP&T Temperature and Fish Presence Survey, (e-mail) June 24, 2009. Berkshire, P. B., Yerrick Creek Hydroelectric Project, Estimate of Average Annual Energy, July 2007. Browne, Patricia, Findings of AHRS Data Review and Evaluation of Cultural Resources Potential for Hydroelectric Project Development…, June 5, 2008. Denali Commission. 2009 Denali Commission List of Distressed Communities. June 2009. DuBois, S. D. 2007. Units 12 and 20D caribou. Pages 65-82 in P. Harper, editor. Caribou management report of survey and inventory activities 1 July 2004-30 June 2006. Alaska Department of Fish and Game. Project 3.0. Juneau, Alaska, USA. Environ Corp., Yerrick Creek – A Review of Available Data and Recommended Flow Duration Curve, Hydrology Report, May 26 2010. Grabacki, S.T. Fisheries Baseline Study for a Proposed Hydroelectric Development on Yerrick Creek, October 2008. Grabacki, S.T. Fisheries Study for Spawning AG and DV and their movement throughout the Creek during May and June 2009, June 2009. Gross, J. A. 2007. Unit 12 brown bear. Pages 132-142 in P. Harper, editor. Brown bear management report of survey and inventory activities 1 July 2004-30 June 2006. Alaska Department of Fish and Game. Project 4.0. Juneau, Alaska, USA. HDR Alaska, Inc. Preliminary Jurisdictional Determination. February 2009. HDR Alaska, Inc. Threatened, Endangered, Sensitive (TES) Plant Report. February 2009. Hollis, A. L. 2006. Unit 12 moose. Pages 126-143 in P. Harper, editor. Moose management report of survey and inventory actitivies 1 July 2003-30 June 2005. Alaska Department of Fish and Game. Project 1.0. Juneau, Alaska, USA. http://alaska.fws.gov/fisheries/endangered/listing.htm http://tetlin.fws.gov/ Page | 26 http://tetlin.fws.gov/wildlife/black_bear.htm http://tetlin.fws.gov/wildlife/birds.htm http://tetlin.fws.gov/wildlife/brown_bear.htm http://tetlin.fws.gov/wildlife/caribou.htm http://tetlin.fws.gov/wildlife/dall_sheep.htm http://tetlin.fws.gov/wildlife/fox.htm http://tetlin.fws.gov/wildlife/marten.htm http://tetlin.fws.gov/wildlife/moose.htm http://tetlin.fws.gov/wildlife/otter.htm http://tetlin.fws.gov/wildlife/snowshoe_hare.htm http://tetlin.fws.gov/wildlife/wolf.htm http://tetlin.fws.gov/wildlife/wolverine.htm http://www.adfg.state.ak.us/pubs/notebook/furbear/lynx.php http://www.wildlife.alaska.gov/index.cfm?adfg=pubs.mgt Parker McNeill D.I. 2005. Portions of Units 12, 13C, and 20D Dall sheep management report. Pages 68-79 in C. Brown, editor. Dall sheep management report of survey and inventory activities 1 July 2001-30 June 2004. Alaska Department of Fish and Game. Project 6.0. Juneau, Alaska. Proue, M., Neely, B. 2009 Cultural Resource Survey of Alaska Power & Telephone’s Yerrick Creek Hydroelectric Project Near MP 1334 of the Alaska Highway, Alaska. Northern Land Use Research, Inc. November 2009. Travis/Pederson Environmental Consulting, Inc. Literature Review and Field Report: Hydrology Baseline Study (Including Water Quality Testing), October 2008. USACOE, DA Permit POA-2009-445 issued for Construction, April 30, 2010. Page | 27 9 APPENDICES  Page | 28   9.1 Agency Correspondence  Page | 29   9.2 Hydrology Studies  Page | 30   9.3 Biological and Other Surveys 9.3.1. Fish Resources Report 9.3.2. Threatened, Endangered, Sensitive (TES) Plant Report 9.3.3. Literature Review and Field Report: Hydrology Baseline Study 9.3.4. Preliminary Jurisdictional Determination 9.3.5. Heritage Resource Survey   Page | 31 9.4 2009 Denali Commission List of Distressed Communities      MEDIA Hydropower project planned for Tok area Photo by Sebastian Sarloos Yerrick Creek Yerrick Creek, which would be diverted for a hydroelectric project for the Tok area, is pictured. Posted: Sunday, September 7, 2014 12:15 am | Updated: 10:06 am, Sun Sep 7, 2014. Jeff Richardson jrchardson@newsminer.com FAIRBANKS — Backers of a proposed new hydropower project near Tok say it could significantly slash electric rates in an area plagued by high energy costs. Alaska Power & Telephone, the Native Village of Tanacross and Tanacross Inc. signed a memorandum of agreement last month to explore the $15 million Yerrick Creek Hydropower Project. The 1.5 megawatt project could supply about 40 percent of the electric load in the Tok and upper Tanana region as early as 2017. The Tok area uses expensive diesel-fired generation to make electricity now, resulting in electric costs of as much as 50 cents per kilowatt. AP&T said the energy generated through hydro power could cost as much as half that rate, providing big savings for residents of Tok, Tanacross, Tetlin and Dot Lake. Tanacross Inc., which is a Native corporation that owns the land, owns property in the area, along with the state of Alaska. The Native Village of Tanacross is working to find grant assistance to help finance Yerrick Creek. “It’s a really long-term project,” said Jason Custer, who handles business development for the utility. “It has a high up-front cost, but after that the cost of operating it drops down to almost nothing.” The proposal calls for a “run of river” hydro project, which would divert a portion of Yerrick Creek down a pipe, using that flowing water to power a turbine. Such projects don’t require large storage dams and are touted for their “minimal environmental footprint” by AP&T. The water diverted from Yerrick Creek would be returned about 3 miles downstream, Custer said. AP&T operates three other “run of river” hydro projects, with other examples in the Southeast Alaska communities of Skagway, Gustavus and Prince of Wales Island. AP&T estimates the project will replace about 375,000 gallons of diesel fuel that is now used for power generation in the region. Custer said the utility also looked at biomass, solar and wind options during seven years of study, but didn’t find an option that made as much financial sense or operated as smoothly as the hydro plant. About $1 million has been spent on the project so far, through a combination of state, federal and private funding. Custer said there are hopes to raise as much as $8 million more, either through a state renewable energy grant or capital funds from the Legislature. Custer said the agreement states that the three parties will form a new entity, Upper Tanana Energy, to advance the project. Commercial details will be worked out as it progresses, he said. BLANK PAGE [intentionally left blank] BLANK PAGE [intentionally left blank] August 18, 2014 12:02 PM Eastern Daylight Time KETCHIKAN, Alaska--(BUSINESS WIRE)-- Tanacross, Inc., the Native Village of Tanacross, and Alaska Power & Telephone (AP&T) are pleased to announce that they have executed a Memorandum of Agreement (MOU) for development of the Yerrick Creek Hydropower Project. The proposed 1.5 MW project would be located near Tanacross, in the Upper Tanana region of Alaska. Once developed, Yerrick Creek will supply clean, affordable energy to Tok and surrounding communities of interior Alaska as an alternative to diesel-fired generators currently supplying 100% of the region’s electricity. “Alaska Power & Telephone applauds Tanacross Inc. CEO Robert Brean and Tribal President Herbert Demit for this shared commitment to renewable energy development” The three entities have formed a new energy business venture, named Upper Tanana Energy, to develop the Yerrick Creek project, and sell power to Alaska Power Company – the incumbent electrical utility, and a subsidiary of Alaska Power & Telephone – through a long-term power sales agreement. Upper Tanana Energy’s Yerrick Creek project is anticipated to supply 4.9 million kilowatt hours of clean energy per year – enough to replace 375,000 gallons of diesel fuel per year, or approximately 40% of the Tok and upper Tanana region’s electrical load. Current engineer estimates indicate that Yerrick Creek has the potential to supply energy at 50% of the cost of diesel-fired generation. Total project cost is estimated at $15 million. Communities benefitting from the project would include Tok, Tanacross, Tetlin, and Dot Lake. The Yerrick Creek hydropower project’s features are located entirely on private land owned by Tanacross, Inc. – an Alaska Native Claims Settlement Act (ANCSA) corporation -- and lands owned by the State of Alaska, eliminating the need for an expensive and time-consuming federal permitting process. Nearly $1,000,000 in expenditures to date have brought the project very near to construction-ready status, thanks to grants provided by the Alaska Energy Authority and USDA Rural Development, and private investment supplied by AP&T. Yerrick Creek is a small, low impact “run-of-river” hydro project with a minimal environmental footprint. The project will use a small diversion to collect water for energy production, before returning water back to the creek downstream. “Run-of-river” projects like Yerrick Creek avoid the need to build large dams to store water, and allow energy to be produced as conditions and river flows permit. The Yerrick Creek project’s useful lifespan is estimated at over 50 years, assuring a clean, reliable supply of affordable power to the Upper Tanana region for decades to come. Tanacross, Inc. CEO Robert Brean stated: “Yerrick Creek offers an opportunity for our corporation to utilize our Alaska Native Claims Settlement Act lands to provide cleaner, more affordable power for the benefit of everyone in the region. We are excited for this project, which benefits our environment, our shareholders, and the many families which are currently struggling to afford high energy costs.” Native Village of Tanacross representative Jeffery Weltzin stated: “Yerrick Creek will play an important role supporting Governor Sean Parnell’s goal of 50% of Alaska’s energy being supplied from renewable sources by 2025. Governor Parnell and our local legislators Senator Donald Olson, Senator Click Bishop and Representative Neal Foster have shown a longstanding commitment to replacing diesel-fired generation of electricity in rural Alaska with locally available renewable sources. We hope that through their leadership, we will gain state financial support for the benefit of the upper Tanana region’s ratepayers, families, and businesses.” “Alaska Power & Telephone applauds Tanacross Inc. CEO Robert Brean and Tribal President Herbert Demit for this shared commitment to renewable energy development,” remarked AP&T President and CEO Robert Grimm. “Thanks to their leadership, and the vision of the Tribal Council and Tanacross Inc. Board, Upper Tanana Energy will provide an option for ‘home-sourcing’ energy from local, renewable sources. It is exciting to see Alaska Native entities entering as key participants within the Tok regional energy market, and bringing cleaner, more affordable energy options to consumers.” AP&T has significant hydropower development experience, having licensed and developed four hydropower projects in Alaska since the mid-1990s, with a fifth project, Reynolds Creek, scheduled for near-term construction. These new projects have helped AP&T’s service areas transition from 90% dependency on costly diesel fuel, to 75% clean, renewable energy. Contacts Alaska Power & Telephone Business Development Jason Custer, 907-225-1950 x 29 jason.c@aptalaska.com LETTERS OF SUPPORT