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HomeMy WebLinkAboutGrantApplication7_JuniperCreekHydroRecon_NO_RESUMES GRANT APPLICATION – FOR – JUNIPER CREEK HYDROELECTRIC RECONNAISSANCE STUDY SEPTEMBER 2013 ~ SUBMITTED TO ~ ALASKA ENERGY AUTHORITY RENEWABLE ENERGY GRANT PROGRAM – ROUND VII RFA AEA 2014-006 ~ SUBMITTED BY ~ RAM VALLEY, LLC 3527 NORTH POINT DRIVE ANCHORAGE, AK 99502 Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Application Page 1 of 19 7/2/2013 Application Forms and Instructions This instruction page and the following grant application constitutes the Grant Application Form for Round VII of the Renewable Energy Fund. A separate application form is available for projects with a primary purpose of producing heat (see RFA section 1.5). This is the standard form for all other projects, including projects that will produce heat and electricity. An electronic version of the Request for Applications (RFA) and both application forms is available online at: http://www.akenergyauthority.org/REFund7.html.  If you need technical assistance filling out this application, please contact Shawn Calfa, the Alaska Energy Authority Grant Administrator at (907) 771-3031 or at scalfa@aidea.org.  If you are applying for grants for more than one project, provide separate application forms for each project.  Multiple phases for the same project may be submitted as one application.  If you are applying for grant funding for more than one phase of a project, provide milestones and grant budget for each phase of the project.  In order to ensure that grants provide sufficient benefit to the public, AEA may limit recommendations for grants to preliminary development phases in accordance with 3 ACC 107.605(1).  If some work has already been completed on your project and you are requesting funding for an advanced phase, submit information sufficient to demonstrate that the preceding phases are completed and funding for an advanced phase is warranted.  If you have additional information or reports you would like the Authority to consider in reviewing your application, either provide an electronic version of the document with your submission or reference a web link where it can be downloaded or reviewed.  In the sections below, please enter responses in the spaces provided, often under the section heading. You may add additional rows or space to the form to provide sufficient space for the information, or attach additional sheets if needed. REMINDER:  Alaska Energy Authority is subject to the Public Records Act AS 40.25, and materials submitted to the Authority may be subject to disclosure requirements under the act if no statutory exemptions apply.  All applications received will be posted on the Authority web site after final recommendations are made to the legislature.  In accordance with 3 AAC 107.630 (b) Applicants may request trade secrets or proprietary company data be kept confidential subject to review and approval by the Authority. If you want information is to be kept confidential the applicant must: o Request the information be kept confidential. o Clearly identify the information that is the trade secret or proprietary in their application. o Receive concurrence from the Authority that the information will be kept confidential. If the Authority determines it is not confidential it will be treated as a public record in accordance with AS 40.25 or returned to the applicant upon request. Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 2 of 19 7/1/2013 SECTION 1 – APPLICANT INFORMATION Name (Name of utility, IPP, or government entity submitting proposal) Ram Valley, LLC Type of Entity: Independent Power Producer Fiscal Year End December 31 Tax ID # none Tax Status: X For-profit Non-profit Government ( check one) Date of last financial statement audit: September 15, 2013 Mailing Address 3527 North Point Drive Anchorage, AK 99502 Physical Address Same Telephone 907-248-0058 Fax None Email dbrailey@alaska.net 1.1 APPLICANT POINT OF CONTACT / GRANTS MANAGER Name David Brailey Title Managing member, Ram Valley LLC Mailing Address 3527 North Point Drive Anchorage, AK 99502 Telephone 907-248-0058 Fax none Email dbrailey@alaska.net 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 X 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); Yes 1.2.2 Attached to this application is formal approval and endorsement for the project by the applicant’s board of directors, executive management, or other governing authority. If the applicant is a collaborative grouping, a formal approval from each participant’s governing authority is necessary. (Indicate Yes or No in the box ) Yes 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). Yes 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/veep/Grant-Template.pdf. (Any exceptions should be clearly noted and submitted with the application.) Yes 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. Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 3 of 19 7/1/2013 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. Juniper Creek Hydroelectric Reconnaissance Study 2.2 Project Location – Include the physical location of your project and name(s) of the community or communities that will benefit from your project in the subsections below. 2.2.1 Location of Project – Latitude and longitude, street address, or community name. Latitude and longitude coordinates may be obtained from Google Maps by finding you project’s location on the map and then right clicking with the mouse and selecting “What is here? The coordinates will be displayed in the Google search window above the map in a format as follows: 61.195676.-149.898663. If you would like assistance obtaining this information please contact AEA at 907-771-3031. The project is located on Juniper Creek, a tributary of Eagle River near Anchorage. The project is located at approximately 61.257oN, 149.73oW. 2.2.2 Community benefiting – Name(s) of the community or communities that will be the beneficiaries of the project. Communities that will benefit from this project include the railbelt energy grid. 2.3 PROJECT TYPE Put X in boxes as appropriate 2.3.1 Renewable Resource Type Wind Biomass or Biofuels (excluding heat-only) X Hydro, Including Run of River Hydrokinetic Geothermal, Excluding Heat Pumps Transmission of Renewable Energy Solar Photovoltaic Storage of Renewable Other (Describe) Small Natural Gas 2.3.2 Proposed Grant Funded Phase(s) for this Request (Check all that apply) Pre-Construction Construction X Reconnaissance Final Design and Permitting Feasibility and Conceptual Design Construction and Commissioning 2.4 PROJECT DESCRIPTION Provide a brief one paragraph description of the proposed project. The proposed project is a run-of-river hydroelectric project located on private property along Juniper Creek, a tributary of Eagle River about 10 miles upstream from the Glenn Highway. The proposed project would include an intake/diversion structure at approximately the 1900-foot elevation and powerhouse at the 1500-foot elevation. The design flow is estimated at 10 to 20 cfs, for an estimated installed capacity of 250 to 500 kW. Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 4 of 19 7/1/2013 Participation of adjacent downstream property owners would increase the available head from 400 feet to either 900 feet or 1,100 feet if one or two adjacent land owners were to participate. This would increase installed capacity to as much as 1,300 kW. The adjacent landowner is open to discussion, but questions the resource and impacts. Results of the feasibility study are expected to encourage local support and participation. 2.5 PROJECT BENEFIT Briefly discuss the financial and public benefits that will result from this project, (such as reduced fuel costs, lower energy costs, local jobs created, etc.)  A reconnaissance study of Juniper Creek will benefit the railbelt population by determining if a viable hydroelectric project can be constructed at Juniper Creek, and providing environmental, engineering, and economic analysis of that project. In the near term, the public benefit is the cost to perform the study. If the project is viable and constructed, the public will benefit from competitively-priced clean renewable energy. 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. The cost of the reconnaissance study will be $71,500. Of this cost, Ram Valley, LLC will contribute $35,750 as cash and in-kind services and requests a $35,750 grant. 2.7 COST AND BENEFIT SUMARY Include a summary of grant request and your project’s total costs and benefits below. Grant Costs (Summary of funds requested) 2.7.1 Grant Funds Requested in this application $35,750 2.7.2 Cash match to be provided $12,000 2.7.3 In-kind match to be provided $23,750 2.7.4 Other grant funds to be provided $0 2.7.5 Other grant applications not yet approved $0 2.7.6 Total Grant Costs (sum of 2.7.1 through 2.7.4) $71,500 Project Costs & Benefits (Summary of total project costs including work to date and future cost estimates to get to a fully operational project) 2.7.7 Total Project Cost Summary from Cost Worksheet, Section 4.4.4, including estimates through construction. $2,350,000 2.7.8 Additional Performance Monitoring Equipment not covered by the project but required for the Grant Only applicable to construction phase projects. $0 2.7.9 Estimated Direct Financial Benefit (Savings) $5,581,052 2.7.10 Other Public Benefit If you can calculate the benefit in terms of dollars please provide that number here and explain how you See narrative for other Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 5 of 19 7/1/2013 calculated that number in Section 5 below. benefits. 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 expects project management assistance from AEA or another government entity, state that in this section. David Brailey of Brailey Hydrologic will be the project manager. Mr. Brailey’s resume, contact information, and references are attached. For the past year, Brailey has managed field hydrologic data collection for the Alaska Energy Authority on the Susitna-Watana Hydroelectric Project. 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. Milestones Tasks Start Date End Date 1. Total head survey Ram Valley LLC contracts Geovera LLC to perform total head survey (matching funds) Oct 2013 Dec 2013 2. Land use permit for intake gage access trail Ram Valley LLC obtains land use permit to construct access trail to intake gage (in-kind services) Oct 2013 Dec 2013 3. Round 7 grant recommendations AEA completes Round 7 grant recommendations Jan 2014 Jan 2014 4. ADF&G permit for gage station Ram Valley LLC obtains ADF&G permit for gaging station installation and dye-dilution discharge measurements (in-kind services) Jan 2014 Mar 2014 5. Construct intake gage access trail Ram Valley LLC constructs access trail to intake gage (in-kind services) May 2014 May 2014 6. Install intake gage station, commence discharge and continuous stage measurement Ram Valley LLC contracts Brailey Hydrologic to install gage station and begin continuous stage measurements (matching funds) May 2014 May 2014 7. Periodic stage-discharge measurements Brailey Hydrologic performs periodic discharge measurements (matching funds) May 2014 Apr 2015 8. Land use, permitting and environmental analysis Ram Valley LLC contracts fish trapping study and permitting analysis July 2014 Dec 2014 9. Hydrologic record extension Brailey Hydrologic extends hydrologic record using data from related watersheds Apr 2015 May 2015 10. Resource identification and analysis Ram Valley LLC contracts Polarconsult Alaska to complete resource analysis May 2015 Jun 2015 11. Preliminary design analysis and cost Ram Valley LLC contracts Polarconsult Alaska to complete preliminary design May 2015 Jun 2015 12. Cost of energy and market analysis Ram Valley LLC contracts Polarconsult Alaska to perform market and cost analysis May 2015 Jun 2015 13. Simple economic analysis Ram Valley LLC contracts Polarconsult Alaska to May Jun Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 6 of 19 7/1/2013 complete economic analysis 2015 2015 14. Final report and recommendations Ram Valley LLC contracts Polarconsult Alaska to complete resource analysis May 2015 Jun 2015 3.3 Project Resources Describe the personnel, contractors, accounting or bookkeeping 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. Ram Valley, LLC will contract several Alaskan firms to provide surveying, hydrologic, engineering, fisheries, permitting, and project management services. Project management and hydrologic consulting services will be provided by David Brailey of Brailey Hydrologic. Surveying will be provided by Geovera LLC. Solstice Consulting will assist Brailey Hydrologic with ADF&G and land use permits for gaging station installation. Using matching funds, a local trailbuilding contractor will construct a trail to the intake gage. Brailey Hydrologic will perform gage installation, discharge measurements, streamflow computations, and hydrologic record extension. Carol Ann Woody, PhD. will perform fish population studies. Polarconsult Inc. will perform resource analysis, preliminary design analysis, cost estimating, and economic analyses. The final report will be prepared by Polarconsult with assistance from Brailey Hydrologic. The lead contractor for the grant (Brailey Hydrologic) is a 25% member of Ram Valley, LLC and has a vested interest in successful completion of the study. Brailey Hydrologic has good working relationships with all of the proposed team members including the Alaska Energy Authority. Resumes of key personnel are attached. 3.4 Project Communications Discuss how you plan to monitor the project and keep the Authority informed of the status. Please provide an alternative contact person and their contact information. As project manager, David Brailey will monitor work progress and expenses and will keep AEA informed regarding the project status. David Brailey will keep Joel Groves of Polarconsult informed as an alternative contact person. Joel’s contact information is: Joel Groves, P.E. Polarconsult, Inc. Anchorage, AK 9950 907-258-2420 3.5 Project Risk Discuss potential problems and how you would address them. Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Application Page 7 of 19 7/2/2013 This project is in the reconnaissance phase and as such there is limited risk associated with the project. In the event that the study concludes the project is not feasible, Ram Valley LLC will not pursue the project and there is no risk. 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 your project and you are requesting funding 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 for the market to be served by your project. For pre-construction applications, describe the resource to the extent known. For design and permitting or construction projects, please provide feasibility documents, design documents, and permitting documents (if applicable) as attachments to this application. Ram Valley, LLC has been monitoring flows in Juniper Creek since 2008. Winter low flows are approximately 3 cfs, and sustained summer flows (June 15 to October 1) are 15 to 20 cfs. Available head on Ram Valley’s property is approximately 400 vertical feet. A design flow of 10 to 20 cfs would result in an installed capacity of approximately 250 to 500 kW. Participation of adjacent downstream property owners would increase the head available for the project from 400 feet to either 900 feet or 1,100 feet if one or two adjacent land owners were to participate. This would increase installed capacity to as much as 1,300 kW. 4.2 Existing Energy System 4.2.1 Basic configuration of Existing Energy System Briefly discuss the basic configuration of the existing energy system. Include information about the number, size, age, efficiency, and type of generation. Matanuska Electric Association, Inc. (MEA) serves the project area. MEA is currently building a new generation facility in Eklutna that will meet all of its power needs starting in 2015. MEA also receives a significant amount of electricity from the existing Eklutna Lake and Bradley Lake hydroelectricfacilities, and a minor amount of electricity from independent power producers in the region. This project would displace fuel for the new Eklutna Power Plant. 4.2.2 Existing 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. MEA currently relies on a combination of hydroelectricity (about 10%) and natural gas (about 90%) for electrical generation. After 2015, this energy mixture will remain largely unchanged, although MEA will have the option of burning fuel oil at its new Eklutna Power Plant should natural gas supplies not be available. The new MEA plant will also be more efficient than Chugach Electric Association’s Beluga Power Plant which currently supplies substantially all of MEA’s non- Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 8 of 19 7/1/2013 hydroelectricity. 4.2.3 Existing Energy Market Discuss existing energy use and its market. Discuss impacts your project may have on energy customers. The railbelt energy grid is the largest utility grid in Alaska and can readily absorb all of the electrical output of this project. This project by itself will not have a significant impact on energy customers, however the cumulative impact of this and other small hydro projects being studied or built on the railbelt will tend to lower and stabilize rates over time by reducing dependence on natural gas for electrical generation. In total, approximately 20 MW of mostly run-of-river small hydros are currently in various stages of study or development throughout the railbelt. During the summer months, this equates to more than 1/5th of MEA’s total system demand. 4.3 Proposed System Include information necessary to describe the system you are intending to develop and address potential system design, land ownership, permits, and environmental issues. 4.3.1 System Design Provide the following information for the proposed renewable energy system:  A description of renewable energy technology specific to project location  Optimum installed capacity  Anticipated capacity factor  Anticipated annual generation  Anticipated barriers  Basic integration concept  Delivery methods The proposed project is a run-of-river hydroelectric system on a steep creek draining a glaciated alpine valley in the upper Eagle River watershed. Major project components include the following: 1. A diversion structure to collect water from the south fork of Juniper Creek near the upper property line at 1900 foot elevation. This would likely consist of a concrete structure in the creek. 2. An intake structure to filter debris out of the water and direct water into the project penstock. 3. An approximately 1,500 foot long penstock down to the lower property line at 1,400-foot elevation. The penstock would be buried for frost protection where possible. 4. A powerhouse fitted with a single turgo or pelton turbine. Single or dual jets may be used depending on the selected design flow. 5. An induction generator. 6. A power line extension to the existing MEA distribution system in the area. If limited to the applicant’s property, the installed capacity is estimated at 250 kW to 500 kW. The capacity factor is estimated to be between 0.50 and 0.70, with higher capacity factors for lower design flows. Annual energy generation is estimated at 1,530 to 2,190 MWh. Extension of the project onto downstream properties would increase annual energy generation to as much as 6,000 MWh. No barriers to implementation are known. Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 9 of 19 7/1/2013 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. Land where the project would be located is owned by the applicant (Ram Valley, LLC). Extension of the project onto adjacent private property(ies) downstream would require participation agreements setting forth the terms of access and shared ownership issues. 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 discussion of potential barriers The project is expected to require the following major permits for construction. 1. The project is believed to not be under FERC jurisdiction. A declaration of intention would be filed with FERC to confirm this regulatory determination. 2. Authorizations from the Municipality of Anchorage as needed to conform with land use and zoning regulations. 3. Fish Habitat Permit. The project reach on Juniper Creek is above listed anadromous fish habitat, and possibly above resident fish habitat as well. Fish trapping would be performed to help confirm the presence or absence of resident fish (such as Dolly Varden) in the project reach. 4. U.S. Department of Army permits for work in waters of the U.S. including wetlands. 5. Alaska Department of Natural Resources Water Rights. 6. RCA authorization. A Utility Certificate from the Regulatory Commission of Alaska may be required depending on how Ram Valley proceeds with the project. Once a decision to develop the project is made, permits are estimated to take 1.5 to 3 years to obtain. This estimate will be refined once the project configuration is determined. The longer timeframe would apply if significant resource issues are identified in the course of the feasibility study. No permitting barriers are known at this time. 4.3.4 Environmental Address whether the following environmental and land use issues apply, and if so how they will be addressed:  Threatened or endangered species  Habitat issues  Wetlands and other protected areas  Archaeological and historical resources  Land development constraints  Telecommunications interference  Aviation considerations  Visual, aesthetics impacts  Identify and discuss other potential barriers The following assessment is based on currently available information. These issues will be investigated further and will be addressed in the reconnaissance report. Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 10 of 19 7/1/2013 Threatened or endangered species: None known. Habitat issues: None known. Wetlands and other protected areas: Although most of the project footprint is uplands, some wetland areas could be affected by the project. Archeological resources: None known. Land development constraints: The project would need to conform with MOA land use and zoning regulations. Telecommunications Interference: None known. Aviation considerations: None known. Visual, aesthetics impacts: Although project borders Chugach State Park, land disturbance would be limited to a vegetated canyon below the neighboring viewsheds. No other visual or aesthetic impacts are known. Other potential barriers: None known. 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: Applicants 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:  Total anticipated project cost, and cost for this phase  Requested grant funding  Applicant matching funds – loans, capital contributions, in-kind  Identification of other funding sources  Projected capital cost of proposed renewable energy system  Projected development cost of proposed renewable energy system Total project costs will depend on the project configuration which has not been determined. Based on known site conditions, a cost of $2000 to $4000 per kW of installed capacity is considered appropriate. This equates to a capital cost of $500,000 to $2,000,000 depending on the project capacity. The cost of the reconnaissance study is $71,500. Of this cost, Ram Valley, LLC will contribute $12,000 as cash, $23,750 as in-kind services and is requesting a $35,750 grant for the study. 4.4.2 Project Operating and Maintenance Costs Include anticipated O&M costs for 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 reporting impacts of projects on the communities they serve.) O&M costs are expected to be primarily associated with maintenance of turbines, electrical switchgear, and intake maintenance. These costs would be funded using revenue from the sale of power. Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 11 of 19 7/1/2013 4.4.3 Power Purchase/Sale The power purchase/sale information should include the following:  Identification of potential power buyer(s)/customer(s)  Potential power purchase/sales price - at a minimum indicate a price range  Proposed rate of return from grant-funded project Sale of power from the Juniper Creek project could take a number of forms. The most straightforward power sales arrangement would be to sell electricity to MEA on a wholesale basis. MEA’s power purchase rate for non-firm power (the avoided cost of fuel, purchased power and O&M) is currently approximately $0.05 to 0.07 per kWh. Detailed cost-based rates are not yet available for the project at the current level of study. Economic and financial analysis is one of the tasks that will be completed as part of the feasibility study. Cost analysis completed to date indicate that the cost-based rate for the project is likely in the same range as MEA’s future avoided cost of energy (fuel + O&M), indicating the project is economically viable. 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. Renewable Energy Source Juniper Creek Hydroelectric Project The Applicant should demonstrate that the renewable energy resource is available on a sustainable basis. Annual average resource availability. Capacity factor of 0.50 at 20 cfs, 0.70 at 10 cfs. (a 20 cfs project is used for this worksheet) Unit depends on project type (e.g. windspeed, hydropower output, biomasss fuel) 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 Railbelt ii. Rated capacity of generators/boilers/other Railbelt iii. Generator/boilers/other type Railbelt iv. Age of generators/boilers/other Railbelt v. Efficiency of generators/boilers/other Railbelt b) Annual O&M cost (if system is part of the Railbelt grid, leave this section blank) i. Annual O&M cost for labor Railbelt ii. Annual O&M cost for non-labor Railbelt c) Annual electricity production and fuel usage (fill in as applicable) (if system is part of the 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.    Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 12 of 19 7/1/2013 Railbelt grid, leave this section blank) i. Electricity [kWh] Railbelt ii. Fuel usage Diesel [gal] Railbelt Other Railbelt iii. Peak Load Railbelt iv. Average Load Railbelt v. Minimum Load Railbelt vi. Efficiency Railbelt vii. Future trends Railbelt d) Annual heating fuel usage (fill in as applicable) i. Diesel [gal or MMBtu] -- ii. Electricity [kWh] -- iii. Propane [gal or MMBtu] -- iv. Coal [tons or MMBtu] -- v. Wood [cords, green tons, dry tons] -- vi. Other -- 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] 500 kW b) Proposed annual electricity or heat production (fill in as applicable) i. Electricity [kWh] 2,190,000 ii. Heat [MMBtu] -- c) Proposed annual fuel usage (fill in as applicable) i. Propane [gal or MMBtu] -- ii. Coal [tons or MMBtu] -- iii. Wood or pellets [cords, green tons, dry tons] -- iv. Other Up to 20 cfs of water from Juniper Creek on a continuous basis. Project Cost a) Total capital cost of new system $2,000,000 b) Development cost $350,000 c) Annual O&M cost of new system $32,850 (based on $0.015 per kWh O&M cost) d) Annual fuel cost $0 Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 13 of 19 7/1/2013 Project Benefits a) Amount of fuel displaced for i. Electricity Approximately 32,000 mmBtu per year (32,000 MCF of natural gas) ii. Heat -- iii. Transportation -- b) Current price of displaced fuel Price of natural gas to railbelt utilities is approximately $7 per MCF. c) Other economic benefits -- d) Alaska public benefits $ 224,000 per year in avoided fuel costs (at $7 per MCF), plus $21,900 in MEA avoided O&M costs (valued at $0.01 per kWh). Total = $245,900 in public benefits. Power Purchase/Sales Price a) Price for power purchase/sale MEA’s avoided cost of electricity is anticipated to be equivalent to the cost based rate for the project. Project Analysis a) Basic Economic Analysis Project benefit/cost ratio $ 5.58 million in benefits / $1.67 million in costs = 3.33 (calculated using Round 6 AEA/ISER economic model) Payback (years) $ 2,350,000 total development cost / $245,900 avoided costs = 9.6 years 4.4.5 Impact on Rates Briefly explain what if any effect your project will have on electrical rates in the proposed benefit area. If the is for a PCE eligible utility please discus what the expected impact would be for both pre and post PCE. Over time, this project would reduce electric rates for the entire MEA service area, which serves approximately 120,000 people consuming approximately 750,000,000 kWh annually. This project would annually displace approximately 2,190,000 kWh of energy generated from natural gas. Because this project is small compared to MEA’s load (approximately 0.3%), it will not have a major impact on rates. MEA is assumed to pay a fixed price for energy from this project that is approximately equal to their avoided cost of energy. In the early years of the project, this would have a minimal impact on rates, possibly resulting in slight increases or decreases depending on MEA’s energy costs. MEA’s avoided cost and rates are expected to increase, so this project will begin to reduce rates. It is projected that after ten years, the energy from this project will be approximately $0.024/kWh less expensive than avoided cost (Based on an MEA avoided cost and fixed price for Juniper Creek output in year 1 of $0.07/kWh and avoided cost escalation of 3% per year). This will result in annual savings to MEA of $52,560, or about $0.0001/kWh reduction in MEA rates from this Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 14 of 19 7/1/2013 one small project. At year 30, the savings to MEA are projected to be approximately $0.10/kWh or $219,000 annually.  SECTION 5– PROJECT BENEFIT Explain the economic and public benefits of your project. Include direct cost savings, and how the people of Alaska will benefit from the project. The benefits information should include the following:  Potential annual fuel displacement (gallons and dollars) over the lifetime of the evaluated renewable energy project  Anticipated annual revenue (based on i.e. a Proposed Power Purchase Agreement price, RCA tariff, or cost based rate)  Potential additional annual incentives (i.e. tax credits)  Potential additional annual revenue streams (i.e. green tag sales or other renewable energy subsidies or programs that might be available)  Discuss the non-economic public benefits to Alaskans over the lifetime of the project The project would displace approximately 32,000 MCF of natural gas annually, or 1.6 million MCF (assuming that MEA can use natural gas for the full 50-year life of the Juniper Creek project). At a value of $7.00 per MCF, this is worth $224,000 annually, or $11.2 million over the 50-year life of Juniper Creek. This project will also reduce MEA’s O&M costs at its new Eklutna Power Plant. This plant will use reciprocating engines. By reducing the run-time on these engines, the Juniper Creek project will reduce the amount MEA spends on engine overhauls, oil, filters, and similar costs, as well as on the purchase of ammonia for scrubbing the plant exhaust to meet ADEC air quality criteria. The incremental value of these avoided O&M costs is estimated at $0.01 per kWh, or $21,900 annually. The combined direct financial benefits of the project are $245,900. This project would increase the efficiency of MEA’s distribution grid by providing more distributed generation. This would benefit MEA members by increasing the electrical efficiency of MEA’s grid and slightly lowering the amount of energy generation required at the Eklutna Power Plant. With an assumed increase in grid efficiency of 2%, this project would eliminate an additional 2% x 2,190,000 kWh x $0.11/kWh = $4,818 in generation costs annually. A wholesale power purchase contract with MEA would likely be at their system average avoided cost (fuel plus O&M). The AEA/ISER model assumes this to be $0.11 per kWh when Juniper Creek is commissioned in 2018. This is estimated to be similar to the cost-based rate for Juniper Creek. Gross annual revenue at this power purchase rate would be $240,900. Sale of the ‘green tags’ from this project would potentially increase project revenues. Green Tags on the voluntary market have stabilized at a price of approximately $0.001 per kWh, which would result in incremental revenue of $2,190 per year assuming that all Green Tags from the project were sold. All communities connected to the railbelt grid would benefit from this project. This project would increase the amount of renewable energy available to the railbelt, decreasing dependence on fossil fuels, which in the case of natural gas in Cook Inlet is a diminishing resource. This project would also not be subject to any future carbon taxes that may be imposed on the burning of Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 15 of 19 7/1/2013 fossil fuels. Carbon taxes would increase the incremental value and public benefit of this project as compared with burning natural gas or fuel oil. 5.1.1 Public Benefit for Projects with Private Sector Sales Projects that include sales of power to private sector businesses (sawmills, cruise ships, mines, etc.), please provide a brief description of the direct and indirect public benefits derived from the project as well as the private sector benefits and complete the table below. See section 1.6 in the Request for Applications for more information. Private sector sales are not anticipated for this project. Renewable energy resource availability (kWh per month) Estimated sales (kWh) Revenue for displacing diesel generation for use at privet sector businesses ($) Estimated sales (kWh) Revenue for displacing diesel generation for use by the Alaskan public ($) SECTION 6– SUSTAINABILITY Discuss your plan for operating the completed project so that it will be sustainable. Include at a minimum:  Proposed business structure(s) and concepts that may be considered.  How you propose to finance the maintenance and operations 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 Ram Valley anticipates that it would become an Independent Power Producer and sell power on a wholesale basis to the local utility, MEA. O&M costs for the project would be funded by revenues from sale of electricity. The market value of the electricity easily exceeds expected O&M costs. No unusual operational issues are known at this time. Operational costs would include periodic scheduled overhauls of the turbines, generators, and ancillary equipment, maintenance of the project intake and related hydro project operations. Back up electric service would be provided by MEA. Ram Valley, LLC commits to reporting the savings and benefits associated with the Juniper Creek hydroelectric project should it be found feasible and move forward to construction. 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. Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 16 of 19 7/1/2013 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. Ram Valley, LLC has been monitoring stream flow on Juniper Creek, reviewing site topography, and related technical matters to determine if the resource is likely to support a hydroelectric development. Our preliminary analysis indicates that the site has good flows through the winter and warrants detailed technical and engineering analysis to determine development costs and economic feasibility. Ram Valley has not received any prior grants for this project. SECTION 8 – LOCAL SUPPORT AND OPPOSITION Discuss local support and opposition, known or anticipated, for the project. Include letters of support or other documentation of local support from the community that would benefit from this project. The Documentation of support must be dated within one year of the RFA date of July 2, 2013. Attached to this application are letters of support from South Fork Hydro, LLC and Matanuska Electric Association, Inc. Ram Valley, LLC is not aware of any opposition to this project. 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. Provide a narrative summary regarding funding source and your financial commitment to the project Of the $71,500 reconnaissance study budget, Ram Valley, LLC is requesting $35,750 in grant funds. This will be matched by $12,000 in cash and $23,750 of in-kind contributions from its members. Most of the in-kind contributions will be in the form of professional labor by David Brailey of Brailey Hydrologic. Mr. Brailey will perform project management, permitting, stream gaging and hydrologic analyses. Cash contributions will pay for surveying, trail clearing, and permitting costs incurred prior to the grant award. As confirmed by Resolution 2013-01 (Attachment D), Ram Valley, LLC is committed to providing these resources for the project. 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. Metering equipment will be installed per MEA’s requirements for the sale of power. Billing records will be used to quantify project performance including energy output and estimated fuel savings. The cost of metering equipment will be determined during the reconnaissance study. Renewable Energy Fund Round VII Grant Application - Standard Form AEA 2014-006 Grant Application Page 17 of 19 7/1/2013 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 Grant 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. Project scoping and contractor solicitation $750 $750 In-kind $1,500 2. Resource identification and analysis $15,000 $15,000 Cash/In-kind $30,000 3. Land use, permitting and environmental analysis $5,000 $5,000 Cash/In-kind $10,000 4. Preliminary design analysis and cost $5,000 $5,000 Cash/In-kind $10,000 5. Cost of energy and market analysis $2,500 $2,500 Cash $5,000 6. Simple economic analysis $2,500 $2,500 Cash $5,000 7. Final report and recommendations $5,000 $5,000 Cash/In-kind $10,000 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ TOTALS $35,750 $35,750 $71,500 Budget Categories: Direct Labor & Benefits $ $23,750 $23,750 Travel & Per Diem $ $ $ Equipment $ $2,000 $2,000 Materials & Supplies $ $1,000 $1,000 Contractual Services $35,750 $4,000 $39,750 Construction Services $ $5,000 $5,000 Other $ $ $ TOTALS $35,750 $35,750 $71,500           ATTACHMENT A    PROJECT TEAM QUALIFICATIONS            ATTACHMENT B    LETTERS OF SUPPORT                      ATTACHMENT C    ELECTRONIC VERSION OF ENTIRE APPLICATION                          ATTACHMENT D    GOVERNING BODY RESOLUTION