HomeMy WebLinkAboutKlawockApplicationTHRHA
2014 Grant Application
Heat Projects
Renewable Energy Fund Round VIII
Applicant Tlingit Haida Regional Housing Authority
Tribally Designated Housing Entity
Project Title Klawock low‐income housing pellet heat
Project Location Klawock, Alaska
Project Contact Craig Moore
VP Development & Construction Management
P.O. Box 32237
Juneau, Alaska 99803
Phone: 907‐780‐6868, direct 907‐780‐3130
Fax: 907‐780‐6895
Email: cmoore@thrha.org
Administrative Contact Joanne Wiita
Planning and Grant Administration
P.O. Box 32237
Juneau, Alaska 99803
Phone: 907‐780‐6868, direct 907‐780‐3158
Fax: 907‐780‐6895
Email: jwiita@thrha.org
Renewable Energy Fund Round VIII
Grant Application – Heat Projects
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SECTION 1 – APPLICANT INFORMATION
Name (Name of utility, IPP, or government entity submitting proposal)
Tlingit Haida Regional Housing Authority
Type of Entity: Housing Authority Fiscal Year End: December 31
Tax ID # 920044273
Tax Status: ☐ For-profit ☒ Non-profit ☐ Government (check one)
Date of last financial statement audit: September 2014
Mailing Address: Physical Address:
PO Box 32237 5446 Jenkins Dr
Juneau AK 99803-2237 Juneau AK 99801
Telephone: Fax: Email:
907 780 6868 jwiita@thrha.org
1.1 APPLICANT POINT OF CONTACT / GRANTS MANAGER
Name: Joanne Wiita Title: Planning and Grant Administration
Mailing Address: PO Box 32237, Juneau AK 99803-2237
Telephone: Fax: Email:
907 780 3158 jwiita@thrha.org
1.1.1 APPLICANT ALTERNATE POINTS OF CONTACT
Name Telephone: Fax: Email:
Craig Moore 907 780 3130 cmoore@thrha.org
Jocelyn Ramirez 907 780 6868 jramirez@thrha.org
Charlie Horvath 907 780 3118 Chorvath@thrha.org
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1.2 APPLICANT MINIMUM REQUIREMENTS
Please check as appropriate. If you do not to meet the minimum applicant requirements, your
application will be rejected.
1.2.1 As an Applicant, we are: (put an X in the appropriate box)
☐ An electric utility holding a certificate of public convenience and necessity under AS 42.05, or
☐ An independent power producer in accordance with 3 AAC 107.695 (a) (1), or
☐ A local government, or
☒ A governmental entity (which includes tribal councils and housing authorities)
1.2 APPLICANT MINIMUM REQUIREMENTS (continued)
Please check as appropriate.
☒ 1.2.2 Attached to this application is formal approval and endorsement for the project by the
applicant’s executive management. If the applicant is a collaborative grouping, a formal
approval from each participant’s governing authority is necessary. (Indicate by checking the
box)
☒ 1.2.3 As an applicant, we have administrative and financial management systems and follow
procurement standards that comply with the standards set forth in the grant agreement
(Section 3 of the RFA). (Indicate by checking the box)
☒ 1.2.4 If awarded the grant, we can comply with all terms and conditions of the award as
identified in the Standard Grant Agreement template at
http://www.akenergyauthority.org/vREFund8.html. (Any exceptions should be clearly noted
and submitted with the application.) (Indicate by checking the box)
☒ 1.2.5 We intend to own and operate any project that may be constructed with grant funds for
the benefit of the general public. If no please describe the nature of the project and who will
be the primary beneficiaries. (Indicate yes by checking the box) The benefit will be for low-
to moderate income rural Alaska residential housing.
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Grant Application – Heat Projects
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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.
Klawock low-income housing pellet heat
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.
Klawock Senior Center: 465 Summit St. Klawock Lat/Long. 55.555. -133.095
2.2.2 Community benefiting – Name(s) of the community or communities that will be the
beneficiaries of the project.
Klawock Alaska
2.3 PROJECT TYPE
Put X in boxes as appropriate
2.3.1 Renewable Resource Type
☐ Wind to Heat ☒ Biomass or Biofuels
☐ Hydro to Heat ☐ Solar Thermal
☐ Heat Recovery from Existing Sources ☐ Heat Pumps
☐ Other (Describe) ☐
2.3.2 Proposed Grant Funded Phase(s) for this Request (Check all that apply)
Pre-Construction Construction
☐ Reconnaissance ☐ Final Design and Permitting
☐ Feasibility and Conceptual Design ☒ Construction
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Grant Application – Heat Projects
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2.4 PROJECT DESCRIPTION
Provide a brief one paragraph description of the proposed heat project.
A biomass pellet heat system will be installed at the (18) unit senior housing center in Klawock,
Alaska. The building is currently heated with oil. The objective of this project is to reduce fossil fuel
consumption and operating costs by installing a wood-fired pellet heating system.
The project will entail the installation of a single biomass heating system. This project will reduce
the cost of heat by offsetting 4,750 gallons of fuel oil with 42 tons of pellets per year. The biomass
heat system will be located within the existing building. THRHA owns and operates the building. It
was modernized in 2007 with the existing building completely insulated on the outside and an
addition that meets and exceeds the State of Alaska BEES. The building is now ready for pellet
heat source with many supply options including local production on Prince of Wales Island. This
project is the result of THRHA’s significant energy planning efforts and project prioritization,
including the energy assessment supported by the Alaska Wood Energy Development Task
Group.
2.5 PROJECT BENEFIT
Briefly discuss the financial and public benefits that will result from this heat project, (such as
reduced fuel costs, lower energy costs, local jobs created, etc.)
Displacing fossil fuel with biomass for low-income housing will lower energy costs and operation
costs. Reduced operational costs will support sustainable housing for low-income rural residents.
THRHA must reduce operating costs in order to increase public benefit by reducing costs that will
enable THRHA to create new programs and services for the entire Southeast region. This program
will assist families and increase the demand for pellets in the community of Klawock. Added
community value will be derived from pellets supply entering the community whereby individual
residents will have access to supply for residential reduced heat.
THRHA’s priority is to reduce costs of operations by addressing high energy costs. The present
cost of fuel oil consumes about 30% of THRHA’s operating budget. THRHA’s goal is reduce costs
that will enable expanded services and support that includes ability for elders to remain living in
their community of origin with a high quality of life. Preventing the need for elders to relocate to
high cost elder assisted living facilities away from family support is a savings for families, the State,
and the Federal Government.
2.6 PROJECT BUDGET OVERVIEW
Briefly discuss the amount of funds needed, the anticipated sources of funds, and the nature and
source of other contributions to the project.
THRHA has completed deep weatherization on the building to ensure energy conservation as the
first measure of energy efficiency, substantial funds have been spent on this purpose. THRHA
seeks AEA funds in the amount of $102,275 to purchase and install the pellet heat system. THRHA
will absorb costs for project management, administrative costs and overhead estimated in the
amount of $45,882, this source is derived from THRHA’s IHBG operating funds / NAHASDA
formula funds.
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Grant Application – Heat Projects
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2.7 COST AND BENEFIT SUMARY
Summarize the grant request and the project’s total costs and benefits below.
Costs for the Current Phase Covered by this Grant
(Summary of funds requested)
2.7.1 Grant Funds Requested in this application $ 102,275
2.7.2 Cash match to be provided $ 0
2.7.3 In-kind match to be provided $ 0
2.7.4 Other grant funds to be provided $ 0
2.7.5 Total Costs for Requested Phase of Project (sum of 2.7.1 through 2.7.4) $ 102,275
Other items for consideration
2.7.6 Other grant applications not yet approved $ 0
2.7.7 Biomass or Biofuel Inventory on hand $ 0
2.7.8 Energy efficiency improvements to buildings
to be heated (upgraded within the past 5 years or
committed prior to proposed project completion) $ 314,381 (AHFC Supplemental)
Project Costs & Benefits
(Summary of total project costs including work to date and future cost estimates to get to a fully
operational project)
2.7.9 Total Project Cost
Summary from Cost Worksheet, Section 4.4.4,
including estimates through construction.
$ 102,275
2.7.10 Additional Performance Monitoring Equipment not
covered by the project but required for the Grant
Only applicable to construction phase projects
$ 5,000
2.7.11 Estimated Direct Financial Benefit (Savings)
The economic model used by AEA is available at
www.akenergyauthority.org/REFund8.html. This
economic model may be used by applicants but is not
required. Other economic models developed by the
applicant may be used, however the final benefit/cost
ratio used will be derived from the AEA model to
ensure a level playing field for all applicants.
$ 10,290 annual savings
2.7.12 Other Public Benefit
If you can calculate the benefit in terms of dollars
please provide that number here and explain how you
calculated that number in Section 5 below.
$ 250,000
20 year savings (see section 5)
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SECTION 3 – PROJECT MANAGEMENT PLAN
Describe who will be responsible for managing the project and provide a plan for successfully
completing the project within the scope, schedule and budget proposed in the application.
3.1 Project Manager
Tell us who will be managing the project for the Grantee and include contact information, a resume
and references for the manager(s). In the electronic submittal, please submit resumes as separate
PDFs if the applicant would like those excluded from the web posting of this application. If the
applicant does not have a project manager indicate how you intend to solicit project management
support. If the applicant anticipates project management assistance from AEA or another
government entity, state that in this section.
The management for this project is Craig Moore, VP of THRHA. Craig is responsible for THRHA
Development and Construction Management (resume attached).
Craig works closely with Robert Reimer, THRHA’s Maintenance Manager. Robert is responsible for
operations and maintenance of 600 THRHA units including multi-family buildings throughout the
southeast region of Alaska. Robert has been with THRHA for five years and prior he was with the
Days Inn for six years as property manager where he was responsible for $24M of property assets.
Robert manages THRHA’s 20 onsite field representatives.
THRHA Field representatives are responsible for repairing and maintaining all THRHA properties
which include-Inspections, reports, estimating, purchasing, record-keeping, scheduling, computer
data entry and all aspects of maintenance including plumbing, heating/ventilation, electrical, and
carpentry. Field reps have received formal boiler training and have advanced certifications.
Richard Bergeron is the field rep for Klawock, he has been with THRHA for 14 years and he is
responsible for the Klawock oil system and will be responsible for maintaining the new pellet
system.
THRHA has experience in operating a pellet system, a Main Energy Systems pellet boiler was
installed in August 2013 for THRHA’s 10,000SF office/warehouse building. O&M is performed by
THRHA’s maintenance department that reports no problems. THRHA is also mondernizing the
Kake housing facility that will be retrofitted with the same pellet system as proposed for Klawock
and will be online by February 2013.
Additionally, THRHA’s stable experience and low maintenance personnel turn-over provides the
stability and onsite capacity to operate the newly installed system in Klawock. Richard Bergeron is
onsite in Klawock and he will maintain the heating system that is proposed. Richard has completed
boiler maintenance training through the oil heat institute and he has his Silver certificate, he is
highly trained to maintain oil boilers, including pumps, valves and hydronic distribution system and
he is onsite in Klawock. Upon installation, Richard will receive training on the new pellet system.
Training will be provided by the company that THRHA purchases the system and the training will
be included as a component in the pellet system RFP. THRHA maintains a back-up certified boiler
technician as on staff personnel located in the JNU office to assist rural southeast communities
including Klawock as needed.
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3.2 Project Schedule and Milestones
Please fill out the schedule below. Be sure to identify key tasks and decision points in in your
project along with estimated start and end dates for each of the milestones and tasks. Please
clearly identify the beginning and ending of all phases of your proposed project.
PHASE IV. CONSTRUCTION
Milestones Tasks
Start
Date
End
Date
1. Design and feasibility
requirements
Secure system alternatives, confirm alternative
/ impacts on existing system, incorporate
annual energy production profile for final
determinations, utilize feasibility study for
conceptual system design and integration
design, determine any technical barriers.
2 months
2. Bid documents
Prepare bid documents for award of contract 1 month
3. Vendor selection and award
Review bids, select, award contract(s), and
finalize contract agreement/terms.
2 weeks
4. Construction
Supervise construction plan, track project costs
(manage and prevent cost overruns), monitor
schedule, commissioning plan, and any
modifications to final design during
construction.
5 months
5. Integration
Integrate new system with existing old system
that will remain as back‐up system.
1 month
6. Testing
Monitoring and testing of combined
functionality of systems.
1 month
7. Final acceptance,
commissioning and start‐up
Complete the final project report according to
AEA requirements.
2 weeks
8. Operations reporting
Establish updated operation and maintenance
plan, determine monitoring equipment and
ten year reporting plan to AEA.
10 years
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3.3 Project Resources
Describe the personnel, contractors, personnel or firms, equipment, and services you will use to
accomplish the project. Include any partnerships or commitments with other entities you have or
anticipate will be needed to complete your project. Describe any existing contracts and the
selection process you may use for major equipment purchases or contracts. Include brief resumes
and references for known, key personnel, contractors, and suppliers as an attachment to your
application.
THRHA’s renewable biomass energy strategy to lower the cost of heat has established several
partnerships including the feasibility study for this project completed through the support of
AWEDTG.
VP of THRHA, Craig Moore, is responsible for this project that will be contracted out for
construction. For THRHA’s portion of the project THRHA uses force account labor. With the
exception of the construction manager, it is anticipated that all other THRHA labor will be local hire.
Additional contractors for the operations plan, design and engineering of the project will be
determined according to THRHA’s policies and procurement procedures. These procurement
policies comply with existing state procurement requirements.
THRHA follows procurement policy procedures in all major equipment purchases including an RFP
process that will be utilized for award of the Klawock pellet system. Additionally, THRHA will
determine the pellet supply through an RFP process. Contracts are entered upon award of RFP
response. Partnerships will be established, for the pellet supply chain that may include new
partnerships that are entered through the guidance of organizations such as Haa Aani, Tongass
Forest Products, NREL, and the U.S. Forest Service personnel. Reference section 3.1 herein for
THRHA key personnel.
Project partners will be determined through the bid process and will include the design &
engineering consultant, construction contractor, and pellet supply retailer.
3.4 Project Communications
Project Manager, Craig Moore, is proficient in project communications and recording of activities
and progress. During the course of the project regular update meetings or teleconferences will be
held with contractors and AEA as requested. Meeting notes will be recorded for the project file.
THRHA will track and monitor the established budget versus actual expenditures by line item.
Craig Moore has a wealth of experience in working with contractors and community, before work
begins Craig will conduct a coordination meeting to include all key partners and community.
Forecasted meetings and reports will include; project coordination meeting, design review, notice
of Intent to construct, teleconferences and reporting by the contractor, project commissioning and
close out. Continued annual reporting will occur according to AEA requirements.
Onsite will be THRHA’s field rep, Richard Bergeron that reports directly to the Maintenance
Manager, Robert Reimer. Data on fuel usage will be extracted from the pellet purchase agreement
and onsite data loggers will be downloaded and recorded by Richard Bergeron and provided in the
format and matrix per requirements by AEA. Due to broadband limited capacity, internet linkage
may not provide remote monitoring thus electronic data will be downloaded on site and provided to
AEA via email or hard drive data storage. Richard Burgeron 907-755-2570, email
rburgeron@thrha.org
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3.5 Project Risk
Discuss potential problems and how you would address them.
THRHA has thoughtfully prepared for installation of biomass systems by preparing and planning
during the past five years and starting with THRHA’s Juneau local pellet system that has been
monitored and examined for potential problems and how to address them upon installation in rural
southeast Alaska. THRHA has one year of experience in operating the pellet system in Juneau.
THRHA’s risk tolerance is minimal given the planning, tenure, capacity, and experience that is in
place. Potential problems may include; 1) breakdown of equipment that is addressed through the
contracts entered and the reliable well trained staff onsite and available from Juneau as back-up as
well as the spare parts that are kept as onsite inventory, 2) THRHA will keep in place an oil back-
up system to prevent freezing if in the event the main pellet heat system goes down, 3) to ensure
transport or supply of pellet fuel source is available, THRHA will have an adequate 4 month supply
in onsite silos, 4) the cost can’t be controlled, however THRHA anticipates that the increased
usage of pellets will keep rates intact and any increases will not outpace fossil fuel costs given this
renewable commodity source will be expected to drop in price as more bulk demand is
experienced. The project is confirmed as economically and technically viable with simple
integration into the existing hydronic heating system. The AWEDTG feasibility study is included as
supporting document to this application.
3.6 Project Accountants
THRHA manages an annual budget of $12 million and employs over 40 technical and
administrative personnel. The VP of Administration, Joyce Niven, will lead fiscal management on
this project.
VP Administration Knowledge / Experience: Joyce Niven has worked in the accounting field for
over 20 years and for the past 12 years, she has been employed by THRHA. She has a bachelors
of Science degree in business and finance from Western Washington University, Bellingham
Washington. Joyce is knowledgeable and proficient in reporting requirements and deadlines of the
various THRHA funding agencies including existing State of Alaska and IHBG grant reporting, and
account structures. Her accounting expertise as well as her experience and knowledge of THRHA
and southeast Alaska brings the THRHA Fiscal Department the ability to address, plan and handle
all accounting aspects of AEA grant accounting. Under the leadership of Joyce Niven, THRHA has
successfully closed five new construction project accounts and during the past three years, two of
these projects were closed with multiple funding sources.
VP Administration Role and Responsibilities THRHA VP Administration, Joyce Niven, will
provide oversight to the AEA grant and THRHA accounting. She will supervise Finance Manager
Irene Tupou who is responsible for all accounting functions including grant accounting that is
performed by her staff. Irene will be responsible for all accounting procedures and activities and
oversee the THRHA Grant Accountant. Irene’s role of the AEA grant will also include oversight
preparation of AEA fiscal reporting. Irene will be responsible for requesting reimbursement to the
AEA project costs and she is responsible for internal monitoring and enforcing of AEA
requirements during the grant. Her role will include adherence and coordination of fiscal reporting
to AEA. Irene is a member of THRHA management, she coordinates all aspects of project
implementation with her senior colleagues at THRHA to ensure that THRHA complies, and
maintains reporting on time and within budget.
THRHA’s Finance Manager Irene Tupou can be reached at 907 780 6868 Email: itupou@thrha.org
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3.7 Financial Accounting System
Discuss the accounting system that will be used to account for project costs and who will be the
primary user of the accounting system.
Bookkeeping functions are performed in-house using Emphasys Systems Elite, to manage fund
accounting that meets Federal requirements (OMB Circular A-133). Finance Manager Irene Tupou
is responsible for all accounting functions including grant accounting that is performed by her staff.
THRHA’s Finance Manager Irene Tupou can be reached at 907 780 6868 Email: itupou@thrha.org
3.8 Financial Management Controls
Discuss the controls that will be utilized to ensure that only costs that are reasonable, ordinary and
necessary will be allocated to this project. Also discuss the controls in place that will ensure that
no expenses for overhead, or any other unallowable costs will be requested for reimbursement
from the Renewable Energy Fund Grant Program.
THRHA financial management and internal controls provide assurance that project goals and
objectives will be met and funds will be used efficiently. To provide checks and fiscal oversight,
THRHA’s internal financial controls and policy separate duties into three financial functions
(authorizing transactions; keeping records; and handling funds). Program funds are tracked in
separate grant accounts with a project code allocated to each. Upon award of funding THRHA
conducts a grant implementation meeting and review newly established codes for associated
expenses. Only allowable expenses are coded and paid out of grant funds, the expenses are
approved by the project manager and monthly grant meetings are held among the finance staff,
project manager, and grant administrator to ensure all expenses are allowable and coded properly
according to the approved budget. THRHA also tracks grant inkind and match including labor and
expenses that are not allowable as grant reimbursement. In addition, THRHA conducts an annual
external financial audit.
THRHA will be responsible for the implementation and administration of this project. THRHA has a
Procurement Policy in place which will be applied to the procurement of all contract labor and
materials secured for this project. The THRHA Board of Commissioners, by resolution has adopted
this Policy for implementation of all THRHA projects. THRHA Policy outlines the process for both
procurement of identified goods and services required by established thresholds of the purchases
(small purchase $0-$100,000); Sealed Bids/invitation for Bids (IFB), when applicable over
$100,000; Competitive Proposals/Request for Proposals (RFP), when applicable over $100,000;
and Non Competitive (Sole Source) Proposals, as well as the methods used for purchase (request
for price quotes, request for proposals, and invitation for bids) that controls the method of
procurement.
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SECTION 4 – PROJECT DESCRIPTION AND TASKS
The level of information will vary according to phase(s) of the project you propose to undertake
with grant funds.
If some work has already been completed on the project and the funding request is for an
advanced phase, submit information sufficient to demonstrate that the preceding phases are
satisfied and funding for an advanced phase is warranted.
4.1 Proposed Energy Resource
Describe the potential extent/amount of the energy resource that is available.
Discuss the pros and cons of your proposed energy resource vs. other alternatives that may be
available, in the market, to be served by your project. For pre-construction applications, describe
the resource to the extent known. For design and permitting or construction projects, please
provide feasibility documents, design documents, and permitting documents (if applicable) as
attachments to this application.
The Southeast Alaska Integrated Resource Plan (SEIRP) cites biomass as a viable energy
strategy for southeast Alaska communities indicating the region should pursue policies and
programs to encourage the conversion of space heating to biomass. Additionally, the SEIRP states
that wood pellet technology is a particularly promising resource option. THRHA has utilized the
Klawock feasibility report (attached) as resource for this funding application. For this proposed
project a reduction in fossil fuel consumption will occur due to approximately 5,000 gallons of fuel
oil displaced with biomass. Pellets are a clear choice given the locally produced biomass as option
and including pellet availability through local providers. Heat pumps aren’t as viable due to higher
cost of electric and insulation. Pellet biomass is the solution given ample retail supply and ease of
managing the system through the automation that a pellet system provides. Cord wood is the most
economical option for supply, however, for operations cord wood is labor intensive and entails
increased management that may increase costs and smooth reliable operations.
Biomass fuel does have some drawbacks. It is somewhat low energy density, so transportation
costs often represent a portion of the pellet fuel price. This project is cost effective by using a high
efficiency gasification pellet boiler system and hot water thermal storage. Grant funding establishes
the economics for the project as feasible, AEA funds are necessary to make this project possible.
Additional benefits that are provided by; 1) a high efficiency, low emission wood fired system, 2)
local economic impact with potential for purchase of local wood pellets to support the regional
economy, 3) pellet production as option from Ketchikan retailer, 4) decreased dependence on
imported oil by replacing 4,000 to 4,750 gallons of #1 fuel oil with renewable biomass fuel, and 4)
a hedge against volatility of the fossil fuel market.
Attached is the Biomass Feasibility Report with recommendations as follows:
Selection of the wood fuel technology most appropriate for the site.
Siting of the fuel storage at the Klawock Senior Center.
Biomass system capital costs based on detailed site investigations, initial plant layout and design,
and direct quotes from manufacturers.
Alternative funding sources (grants)
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4.1.1 For Biomass Project only
Identify any wood inventory questions, such as:
Ownership/Accessibility. Who owns the land and are their limitations and restrictions to
accessing the biomass resource?
Inventory data. How much biomass is available on an annual basis and what types (species)
are there, if known? Please attach any forest inventory reports
THRHA owns and operates the building proposed for this project. There are no limitations or
restrictions in accessing the biomass supply. Pellet has been determined as a selected fuel source
due to local availability and/or imported pellets that can be stored for a 6 month supply that will limit
any shortfall of pellets. The pellet supply chain and delivery is anticipated to improve due to current
southeast Alaska pellet heating strategies that include multiple communities converting to pellet
heat that will provide improved economy of scale. A local supplier in Ketchikan is an option as well
as a supplier in Fairbanks and potential suppliers on Prince of Wales Island as well as retailers
located out of State that are dependable and cost effective options should increased demand
absorb local supply.
4.2 Existing Energy System
4.2.1 Basic configuration of Existing Heating Energy System
Briefly discuss the basic configuration of the existing energy system. Include information about the
number, size, age, efficiency, and type of generation.
The Klawock Senior Center uses #1 fuel oil fired heating system. The Klawock Senior Center is a
24,980 ft2 facility housing approximately 30 residents and staff. The facility used approximately
5,000 gallons of #1 fuel oil annually for space heating and domestic hot water heating. Annual
expenditures are approximately $20,650 at the fuel price, this past winter it was $4.13 per gallon.
An above ground 1,100 gallon fuel oil tank is used for onsite storage.
The existing boiler room contains two model WTGO‐7 Weil McLain hot water boilers firing on #1
fuel oil and rated at 210,000 Btu/hr output and 50 psig. The boilers were installed in 2008 and are
in excellent condition. The hot water heating distribution system is a primary‐secondary piping
system with individual zone pumps distributing water throughout the building. Baseboard fin
tube radiant heaters provide space heating for rooms. A makeup air handling unit with a hot
water coil is used for the kitchen and common area. A digital control system is installed by
Delta Controls, however there is no way to interface with the control system without bringing
in a service technician with a laptop and appropriate software. Domestic hot water is heated
indirectly using the heating boilers and stored in two 120 gallon HTP Superstor tanks. There is
room in the existing boiler room to locate hot water thermal storage tanks and one
wood fired boiler.
4.2.2 Existing Heating Energy Resources Used
Briefly discuss your understanding of the existing energy resources. Include a brief discussion of
any impact the project may have on existing energy infrastructure and resources.
Other options for energy are heat pumps, however, this is not a viable option due to higher cost of
electric and insulation. Cord wood is the most economical option for supply, however, for
operations cord wood is labor intensive and entails increased management that may increase
costs and smooth reliable operations. Pellet biomass is the solution given ample retail supply and
ease of managing the system through the automation that a pellet system provides. THRHA
recognizes that this project will reduce fossil fuel consumption that may have minimal effect on the
local oil supply company. Conversely, this project poses an opportunity for local pellet suppliers to
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undertake the supply chain and provide retail pellets as a strong and viable business opportunity
that supports and improves the island economy.
4.2.3 Existing Heating Energy Market
Discuss existing energy use and its market. Discuss impacts your project may have on energy
customers.
Residential homes predominantly use fuel oil heat. A small percentage of residential homes use
local wood source for heat. The cost of local fuel will not be affected due to THRHA’s conversion to
a biomass system. Conversely, the increased use of biomass to the community may benefit
households by lowered heating costs for those that convert to biomass given the increased
availability of pellets in their community. Additionally, pellet demand may increase due to this
project.
4.3 Proposed System
Include information necessary to describe the system you are intending to develop and address
potential system design, land ownership, permits, and environmental issues.
4.3.1 System Design
System and optimum installed capacity One advanced combustion wood pellet boiler sized at
approximately 0.16 mmBtu/hr of heat output would be combined with approximately 200 gallons of
thermal storage to efficiently meet the range of heating needs.
Anticipated capacity factor The rated operating range of the system would be from ~0.05 to
~0.16 mmBtu/hr with thermal storage allowing short term peaks to be met. The hot water thermal
storage would be heated to a preset temperature (typically 195°F or higher) that is higher than
distributed for building heat.
Basic integration concept The thermal storage tank(s) would use a 3‐way mixing valve to blend
hot water in the tank with colder return water from the senior center to maintain a range of supply
water temperatures (160°F – 190°F) determined by an outside air temperature reset schedule.
The storage would allow the system to meet a 1‐hr peak of ~0.18 mmBtu/hr and a 15 minute
peak of ~0.26 mmBtu/hr. The storage would also allow the boiler to operate efficiently to
provide domestic hot water heating. The storage will hold approximately 88,000 Btu for
domestic hot water usage. This allows the pellet boiler to fire for a period of approximately 30
minutes within its efficient firing range to charge the storage. The heat in the storage is then
used to provide domestic hot water needs, until the temperature drops to ~140oF and the
system has to fire to charge it once more.
Delivery methods Locally or out-of-state supplied pellets will be delivered by truck/barge and a 6
month supply stored on property to address any anticipated barrier of lack of pellet source. The
wood pellet boilers, metering bin, expansion tank, valves, fittings, and boiler pump will be installed
in the existing boiler room. A fuel storage bin capable of holding 30 tons of wood pellets will be
located next to the building to accept bulk deliveries of wood pellets pneumatically or with an
auger. Wood pellets will be automatically transferred using a flexible auger or pneumatic hose from
the storage bin to a metering bin that feeds the wood pellet boiler. The wood pellet boiler will heat
the hot water thermal storage system located in the existing boiler room.
Barriers The hot water thermal storage will tie in with the existing heating distribution pipes. Any
barriers with pellet supply or breakdown of the pellet system will be addressed by utilization of the
existing fuel oil fired heating boilers that will remain in place and integrated to supplement the
biomass system during periods of maintenance and if the heating demand is outside the range of
the biomass system. See feasibility study Appendix A for conceptual site plan, floor plan, and
schematic for the biomass system option 1a schematic and plan view. Figure 7 shows the
estimated wood pellet system coverage of the FY 2013 load duration curve.
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Appendix A option 1a
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Figure 7 above shows 99% biomass coverage of the FY 2013 load duration curve. Actual coverage
will vary depending on weather conditions, peak demands, equipment operation schedules, and
periods when the boilers are shut down for maintenance. This report assumes 95% coverage of
fuel oil usage for estimating the potential fuel use and savings for this memorandum.
The existing technology for efficiently using pellet as biomass for space heating and domestic hot
water heating is proven. Manufacturers of this technology are available both domestically and
abroad. Manufacturers will be investigated prior to purchase. Local codes and regulations may
require modifications or additional components for compliance depending on the system
considered. The proposed system is a high efficiency indoor wood pellet boiler. The high efficiency
indoor wood pellet boilers utilize premium wood pellets as a renewable biomass fuel source for hot
water space heating systems. Wood pellets are automatically fed from an adjacent storage hopper
into the firebox based on heating demand. Efficiencies can exceed 80% when coupled with a hot
water thermal storage system that allows the boiler to operate at high fire to charge the hot water
thermal storage tank. Multiple boilers can be operated to increase heating capacity. Equipment
costs can vary depending on the heating capacity required. Annual savings can range from $3,000
to $6,000 per year based on a facility using 5,000 gallons of #1 fuel oil per year at current prices.
Manual and automatic hopper loading is available. Ash removal is manual. A partial list of
manufacturers include ACT Bioenergy, Froling, MESys, Evo World, Windhager, Kedel, and Wood
Master.
Thermal storage tanks will be installed, also known as accumulator tanks or buffer tanks, can raise
the efficiency of hot water heating systems firing on wood. Solid fuels burn more efficiently at
higher firing rates than at lower rates or idle modes where the fuel smolders, smokes, and wastes
energy. Hot water thermal storage allows the solid fuel boiler to fire efficiently at full output to store
the heat at elevated temperatures in storage tanks. For optimum operation a mixing valve is
installed to blend cold water returning from the facility with hot water stored in the thermal storage
tank. Hot water is sent back to the facility at a temperature that is lower than the storage tanks,
providing heat storage and a buffer for short periods of high demand. This method of operation
reduces smoldering and smoking from inefficient operation, fuel use, creosote buildup, and the
need for frequent stoking.
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4.3.2 Land Ownership
Identify potential land ownership issues, including whether site owners have agreed to the project
or how you intend to approach land ownership and access issues.
THRHA owns and operates the building and has site control on land that is required for the
biomass system and storage. There are no issues concerning ownership.
4.3.3 Permits
Provide the following information as it may relate to permitting and how you intend to address
outstanding permit issues.
List of applicable permits
Anticipated permitting timeline
Identify and discuss potential barriers
City of Klawock does not require any permits for this project. This project will require review by the
State of Alaska Fire Marshall, THRHA will consult with the Fire Marshall and meet all requirements.
The existing mechanical room is already fire rated room and has the required alarm systems
THRHA’s consultant indicates there should not be any permitting issues. THRHA follows all State
permitting requirements, if any other permits are required, THRHA will be in compliance. There are
no anticipated barriers to this project. A high efficiency, low emissions boiler will be selected and
will fall well below any emissions permitting thresholds. There are no anticipated barriers
associated with permitting the project.
4.3.4 Environmental
Address whether the following environmental and land use issues apply, and if so how they will be
addressed:
Threatened or endangered species - none
Habitat issues – none
Wetlands and other protected areas – n/a
Archaeological and historical resources n/a
Land development constraints n/a
Telecommunications interference n/a
Aviation considerations n/a
Visual, aesthetics impacts none
Identify and discuss other potential barriers
THRHA complies with applicable environmental standards, including without limitation applicable
laws for the prevention of pollution, management of hazardous waste, and evaluation of
environmental impacts on all THRHA projects including this proposed project for Klawock. THRHA
will complete the ER for the proposed site and pellet project that is on land that is already disturbed
and is not a wetland and will fall within the minimum footprint that would otherwise trigger corp of
engineers permitting, see following indicating location is within residential area that is already
established.
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Stacking issues – the new technology proposed herein burns clean with a highly efficient boiler.
We anticipate no negative reaction from the community on the wood smoke stack emissions that is
expected to be comparable to emissions of efficient fuel oil boilers.
4.4 Proposed New System Costs and Projected Revenues
(Total Estimated Costs and Projected Revenues)
The level of cost information provided will vary according to the phase of funding requested and
any previous work the applicant may have done on the project. Applicants must reference the
source of their cost data. For example: Applicant’s records or analysis, industry standards,
consultant or manufacturer’s estimates.
4.4.1 Project Development Cost
Provide detailed project cost information based on your current knowledge and understanding of
the project. Cost information should include the following:
$102,275 Requested grant funding
$ 45,182 THRHA absorbed costs
$ 2,500 project management travel
$30,682 management personnel and administrative overhead
$12,000 reporting (10) years
$102,275 Projected capital cost of proposed renewable energy system
One (1) ‐ 160,000 Btu/hr wood pellet hot water boiler, installed $ 30,000
30 ton storage bin $ 1 5,000
Storage bin site work $ 5,000
Thermal storage 200 gal with insulation $ 7,000
Interconnection with existing boiler room, pumps, installation $ 7,500
Electrical $ 4,500
Mechanical $ 4,500
Design and feasibility requirements, bid documents, vendor selection and award, Integration and
testing, final acceptance, commissioning and start-up, operations reporting $ 28,775
$147,457 Projected Total cost of proposed renewable energy system
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4.4.2 Project Operating and Maintenance Costs
Include anticipated O&M costs for any new facilities constructed and how these would be funded
by the applicant.
(Note: Operational costs are not eligible for grant funds however grantees are required to meet
ongoing reporting requirements for the purpose of recording the impacts of AEA projects on the
communities they serve.)
THRHA has selected wood pellet as biomass fuel and is included as evaluation in the feasibility
report. Fuel prices used for evaluation are $330 per ton for wood pellets. The Biomass
Prefeasibility Report cites the following:
Potential fuel suppliers were contacted for pricing and availability of biomass fuel. Tongass Forest
Enterprises in Ketchikan supplies wood pellets as local resource as well as other up and coming
prospective suppliers as potential for purchase on Prince of Wales Island.
THRHA can reduce annual operating costs for space heating and domestic hot water heating by
installing a high efficiency, low emission wood fired heating system for the Klawock Senior Center.
The project will offset approximately 80% to 95% of the fuel oil use.
With installation of the new pellet system THRHA anticipates operating costs will be substantially
reduced. Operating costs for the facility are funded through a combination of IHBG subsidy funds
and rental income.
4.4.3 Heating Purchase/Sale
The heat purchase/sale information should include the following:
Identification of potential energy buyer(s)/customer(s)
Potential heat purchase/sales price - at a minimum indicate a price range
Proposed rate of return from grant-funded project
No waste heat will be sold. Potential buyers may include the City of Klawock office building or
surrounding homes, feasibility has not yet been determined. The project is sized only for THRHA
building heat load and not for retail sale.
4.4.4 Project Cost Worksheet
Complete the cost worksheet form which provides summary information that will be considered in
evaluating the project.
Please fill out the form provided below and provide most recent heating fuel invoice that supports
the amount identified in “Project Benefits” subpart b below.
Renewable Energy Source
Annual average resource availability. Excess of 42 tons of local supply and out of state
Unit depends on project type (e.g. windspeed, hydropower output, biomass fuel)
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Existing Energy Generation and Usage
a) Basic configuration (if system is part of the Railbelt1 grid, leave this section blank)
i. Number of generators/boilers/other 2
ii. Rated capacity of generators/boilers/other 210k BTU/hr
iii. Generator/boilers/other type Boilers
iv. Age of generators/boilers/other 6 years old
v. Efficiency of generators/boilers/other 80%
b) Annual O&M cost (if system is part of the Railbelt grid, leave this section blank)
i. Annual O&M cost for labor $5,100
ii. Annual O&M cost for non-labor $20,650
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] n/a
ii. Fuel usage
Diesel [gal] n/a
Other n/a
iii. Peak Load n/a
iv. Average Load n/a
v. Minimum Load n/a
vi. Efficiency BEEs rated after 2007 renovation and addition
vii. Future trends Energy conservation education
d) Annual heating fuel usage (fill in as applicable)
i. Diesel [gal or MMBtu] 5,000 gallons
ii. Electricity [kWh] n/a
iii. Propane [gal or MMBtu] n/a
iv. Coal [tons or MMBtu] n/a
v. Wood [cords, green tons, dry tons] n/a
vi. Other n/a
Proposed System Design Capacity and Fuel Usage
(Include any projections for continued use of non-renewable fuels)
a) Proposed renewable capacity
(Wind, Hydro, Biomass, other)
[kW or MMBtu/hr]
160,000 MMBtu
1 The Railbelt grid connects all customers of Chugach Electric Association, Homer Electric Association, Golden Valley Electric
Association, the City of Seward Electric Department, Matanuska Electric Association and Anchorage Municipal Light and Power.
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b) Proposed annual electricity or heat production (fill in as applicable)
i. Electricity [kWh] n/a
ii. Heat [MMBtu] 638 MMBtu
c) Proposed annual fuel usage (fill in as applicable)
i. Propane [gal or MMBtu] n/a
ii. Coal [tons or MMBtu] n/a
iii. Wood or pellets [cords, green tons,
dry tons]
42 Tons
iv. Other n/a
Project Cost
a) Total capital cost of new system $102,275
b) Development cost $28,775
c) Annual O&M cost of new system $1,600
d) Annual fuel cost $13,860 ($330 per ton)
Project Benefits
a) Amount of fuel displaced for
i. Electricity n/a
ii. Heat 4,750 fuel oil gallons
iii. Transportation n/a
b) Current price of displaced fuel $3.88 (2014 winter $4.13/gal)
c) Other economic benefits Displaced fuel oil with potential for locally produced
product resulting in employment and improved
economic impact.
d) Alaska public benefits See Section 5 herein. Reduced risk of oil spill. Local
residential awareness and exposure to lower cost
heating option. Increased demand and supply of
biomass for economic local impact. Reduced threat
of increased living costs on elderly population that
allows aging in place and lowered cost burden on
government.
Heat Purchase/Sales Price
a) Price for heat purchase/sale n/a
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Project Analysis
a) Basic Economic Analysis
Project benefit/cost ratio .90 (source AWEDTG Feasibility Study)
Payback (years) 24.5 years (source AWEDTG Feasibility Study)
4.4.5 Impact on Rates
Please address the following items related to the proposed location of the heating project. If more
than one building will be impacted, please address this information for each building.
Buildings name
THRHA Low Rent Senior multi-family housing
Type or primary usage of the building
Residential
Location
Klawock
Hours of operation
n/a
Single structure or multiple units
Single structure
Total square footage
24,980
Electrical consumption per year
n/a (current price is $0.1274)
Heating oil/fuel consumption per year
5,000 gallons
Average number of occupants
1 building (18-25 occupants)
Has an energy audit been performed? When? Please provide a copy of the energy audit, if
applicable.
Yes. An audit was completed prior to the complete renovation and addition in 2007 at which
time the State of Alaska BEEs standard was met.
Have building thermal energy efficiency upgrades been completed?
o If applicable, please provide evidence of efficiency improvements including cost and
anticipated savings associated with upgrades.
Yes. THRHA utilized AHFC Supplemental funds for energy efficiency in the amount of
$314,381 during the 2007 building addition and renovation. In 2007 insulation levels and
improvements were made to R-Value and air tightness of the building shell to exceed the
BEEs standard for the SE region. In addition, energy efficiency lighting upgrades and
energy star appliances were installed. The renovation included planned space for an
alternative heat system once funding and technology became available for installation. We
believe that the time is right to install the pellet system and utilize the space that was
designed and is available for this purpose.
o Estimated annual heating fuel savings
$6,790
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SECTION 5– PROJECT BENEFIT
Explain the economic and public benefits of your project. Include direct cost savings, and
how the people of Alaska will benefit from the project.
The community of Klawock currently has no pellet delivery network, a project of this size owned
and operated by THRHA will bring pellet as option for lowered cost heating to the community in the
form of pellet supply. This project will make available a supply network for local citizens to tap into
for their supply needs. Displacing fossil fuel with biomass for low-income housing will lower energy
costs and operational costs. THRHA’s reduced operational costs will result in sustainable housing
and increased housing for low-income rural residents. The public directly benefits by empowering
rural residents with the ability to reside in their community of origin through lowered cost of living
while maintaining their traditional indigenous way-of-life that provides a rich diversity and value to
the State of Alaska. There isn’t a way to place a monetary value on this benefit, however, it is
clearly a substantial savings to have elderly residents reside in their own community, living by and
receiving assistance from their family versus relocating to costly Government assisted living
facilities in urban areas.
The benefits include $10,290 in potential annual savings for fuel and operations of the system.
Over 4,750 gallons of fuel oil is forecasted to be displaced by 43 tons of pellets. An estimated
savings of $250,000 is projected over the lifetime of the evaluated renewable energy project. The
cost savings of $250,000 will directly result in other program and services that can be offered to
low-income families through cost savings if THRHA IHBG Federal Funds. This is a direct benefit to
the public.
Attached is a recent invoice for heating fuel purchased that was at the rate of $3.88 per gallon, the
recent cost went down from $4.13 per gallon at the time of the feasibility study.
SECTION 6– SUSTAINABILITY
Discuss the operation of the completed project so that it will be sustainable.
Include at a minimum:
Proposed business structure(s) and concepts that may be considered.
How the maintenance and operations of the completed project will be financed for the life of the
project
Identification of operational issues that could arise.
A description of operational costs including on-going support for any back-up or existing
systems that may be require to continue operation
Commitment to reporting the savings and benefits
THRHA will be responsible for the newly installed system that is expected to have a 20-30 year life.
THRHA estimates that there will not be any increase in cost of annual maintenance with the
installation of the pellet-fired boiler. This is because the fuel consistency is so high, the material
handling so smooth, and the pellet boilers so reliable that in essence it is as close to being as
automatic as a oil fired boiler. Currently the onsite maintenance representative, Richard Bergeron
maintains the oil boiler and he will continue to maintain and operate the pellet boiler with no
additional time or part expenses incurred. The net present value and benefit to cost calculation
assumes a 20 year project life; during that period, costs must be assumed to escalate, however, by
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comparison to the anticipated cost of fuel oil, the project remains less expensive and includes
multiple benefits versus continued fuel oil use.
THRHA already maintains and has its own boiler tech on site / staff to maintain the boiler system
that are funded by IHBG annual formula funds. With this project the result will be no additional cost
to THRHA, in fact savings which is the goal to lower operating cost for the subject buildings for
long-term operating sustainability. While a back-up system is not required, THRHA will maintain the
existing oil boiler system as a back-up to ensure continued operations should there be any issues
with the pellet system at any time.
THRHA is committed to submitting reports as required by AEA on fuel savings and data from the
monitoring equipment that will be installed and data/reports made available to AEA. Contractors
will assist on installation of monitoring equipment and the contractor will provide a matrix for data
collection and reporting by THRHA that is acceptable to AEA.
SECTION 7 – READINESS & COMPLIANCE WITH OTHER GRANTS
Discuss what you have done to prepare for this award and how quickly you intend to proceed with
work once your grant is approved.
Tell us what you may have already accomplished on the project to date and identify other grants
that may have been previously awarded for this project and the degree you have been able to
meet the requirements of previous grants.
In 2007 THRHA renovated the existing structure and included an addition that meets the State of
Alaska BEEs standard to ensure the most important aspect of energy efficiency is met through
energy conservation. There is not a recent AkWarm audit available for this building. The feasibility
study (attached option 1a) for this project was completed by WES energy & Environment, LLC.
THRHA is ready to proceed rapidly on this project upon award of funding by working closely with
AEA and quickly securing contractor(s) and procuring equipment through an RFP process.
THRHA has a local trained labor pool available to begin work immediately.
SECTION 8 – LOCAL SUPPORT AND OPPOSITION
Discuss local support and opposition, known or anticipated, for the project. Include letters of
support or other documentation of local support from the community that would benefit from this
project. The Documentation of support must be dated within one year of the RFA date of July 2,
2014.
THRHA Vice President, Craig Moore, and consultant George Fetchko conducted a public meeting
to describe this proposed project during their visit to Klawock on July 17, 2014, there was no
opposition cited during the meeting. Letters of support are included with this application.
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SECTION 9 – GRANT BUDGET Tell us how much you are seeking in grant funds. Include any
investments to date and funding sources, how much is being requested in grant funds, and
additional investments you will make as an applicant.
9.1 Funding sources and Financial Commitment
Provide a narrative summary regarding funding source and your financial commitment to the
project
THRHA is committed to reducing fossil fuel consumption by seeking funds for its alternative energy
solutions. THRHA requests AEA funding in the amount of $102,275 to finalize design, purchase
and install the pellet system. THRHA commits resources and personnel that will be absorbed by
THRHA. The estimated amount of inkind includes; a) $12,000 over a ten year period to meet AEA
reporting requirements, b) $2,500 for project manager’s travel, c) $30,682 administrative overhead
for management personnel and administration including accounting/grant management. These
costs will be covered by THRHA IHBG formula funds.
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.
Final determination will be made after consulting with AEA and contractors on the type of
monitoring equipment that will best meet the requirements of AEA. It is assumed that a BTU meter
on the pellet boiler will be required and electrical usage monitored and data loggers installed for
BTU output. A budget placeholder in the amount of $5,000 has been included in the budget section
of this application.
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Applications MUST include a separate worksheet for each project phase that was identified in
section 2.3.2 of this application, (I. Reconnaissance, II. Feasibility and Conceptual Design, III. Final
Design and Permitting, and IV. Construction and Commissioning). Please use the tables provided
below to detail your proposed project’s budget. Be sure to use one table for each phase of your
project.
If you have any question regarding how to prepare these tables or if you need assistance preparing
the application please feel free to contact AEA at 907-771-3031 or by emailing the Grants
Administrator, Shawn Calfa, at scalfa@aidea.org.
Milestone or Task
Anticipated
Completion
Date
RE- Fund
Grant Funds
Grantee
Matching
Funds
Source of
Matching
Funds:
Cash/In-
kind/Federal
Grants/Other
State
Grants/Other
TOTALS
1. Design and feasibility
requirements
2 months $13340 $ $13340
2. Bid documents
1 month $2000 $ $2000
3. Vendor selection and award
2 weeks $1000 $ $1000
4. Construction
5 months $73500 $ $73500
5. Integration
1 month $3750 $ $3750
6. Testing
1 month $3750 $ $3750
7. Final acceptance,
commissioning and start‐up
2 weeks $2850 $ $2850
8. Operations reporting
10 years $2085 $ $2085
TOTALS $102275 $ $102275
Budget Categories:
Direct Labor & Benefits $0 $ $0
Travel & Per Diem $0 $ $0
Equipment $45000 $ $45000
Materials & Supplies $7000 $ $7000
Contractual Services $37775 $ $37775
Construction Services $12500 $ $12500
Other $ $ $
TOTALS $102275 $ $102275