HomeMy WebLinkAboutStetson Grant Application - SignedRenewable Energy Fund Round VII
Grant Application-Standard Form
Application Forms and Instructions
1~0 /\.1 . ..u.-.
-=:) ENERGY AUTHORITY
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.akenergyauthoritv.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, provid e
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 th e
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 th e
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.
AEA 2014-006 Application Page 1 of22 7/2/2013
Renewable Energy Fund Round VII
Grant Application -Standard Form
SECTION 1-AP PLICANT INFORMATION
Name (Name of utility, IPP, or government entity submitting proposal)
Chugach Electric Association, Inc.
Type of Entity: Fiscal Year End 12131/13
Tax ID #92-0014224 Tax Status: __ For-profit __ Non-profit ....X....Government (check one)
Date of lastfinancial statement audit: 12/31/12
Mailing Address
P .0 Box 196300
Anchorage, AK 99519-6300
Telephone
(907) 762-4759
Fax
(907) 762-4191
Physical Address
5601 Electron Drive
Anchorage, AK 99519
Email
Ron_ vecera@ch ugachelectric.com
1.1 APPLICANT POINT OF CONTACT I GRANTS MANAGER
Name Title
Ronald K. Vecera Director, Renewable Energy Business Development
Mailing Address
P.O. Box 196300
Anchorage, AK 99519·6300
Telephone
(907) 762-4759
Fax
(907) 762-4191
Email
Ron_ vecera@ch ugachelectric.com
1.2 APPLICANT MINIMUM REQUIREMENTS
Please check as appropriate. lfyou .do not to meet the minirrwm applicant requirements,'your.
application will be rejected. ····_._ .•. · < .. .. ·· ·· .. · ·
1.2.1 As an Applicant, we are: (put an X in the appropriate box)
X 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);
1.2.2 Attached to this application is formal approval and endorsement for the project by
Yes 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 )
1.2.3 As an applicant, we have administrative and financial management systems an d
Yes follow procurement standards that comply with the standards set forth in the grant
agreement (Section 3 ofthe RFA).
Yes
1.2.4 If awarded the grant, we can comply with all terms and conditions of the award a s
identified in the Standard Grant Agreement template at
http://www .akenergyauthoritv .org/veep/G rant-Template. pdf. (Any exceptions
should be clearly noted and submitted with the application.)
1.2.5 We intend to owil and operate any project that may be constructed with grant
Yes funds for the benefit of the general public. If no please describe the nature of th e
project and who will be the primary beneficiaries.
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Renewable Energy Fund Round VII
Grant Application -Standard Form
SECTION 2 ~ PROJECT SUMMARY
This section is intended to be no more than a 2-3 page overv1ew of your project
2.1 Project Title -(Provide a~ to I word title for your project). Type in space below.
Stetson Creek Diversion/Cooper Lake Dam Facilities Project
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 at the northern extent of the existing Cooper Lake project, approximately
4.5 miles south of Cooper Landing, Alaska. A map of the site is attached.
2.2.2 Community benefiting -Name(s) of the community or communities that will be the
beneficiaries of the project.
Communities benefiting from the renewable energy include those Chugach serves (i.e.,
Anchorage, Girdwood, Portage, Hope, Cooper Landing, Moose Pass and Tyonek) as well as
the City of Seward. Current wholesale contracts with Matanuska Electric and Homer Electric
will expire before the project is in service so it is doubtful that their communities will benefit.
Residents and visitors to the Kenai Peninsula will benefit from improved fish habitat. The Kenai
area will also have the economic benefit of a construction project that will last two seasons.
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
Reconnaissance Final Design and Permitting
Feasibility and Conceptual Design X Construction and Commissioning
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Renewable Energy Fund Round VII
Grant Application -Standard Form
2.4 PROJECT DESCRIPTION
Provide a brief one paragraph description of the proposed proje ct.
As a condition of the Federal Energy Regulatory Commission {FERC) relicensing of the Cooper
Lake plant in 2007, Chugach agreed to construct a project to divert water from Stetson Creek
into the Cooper Lake reservoir and a related structure to release water into Cooper Creek. The
project will enhance fish habitat and add water to Cooper Lake which will result in additional
hydroelectric energy generation. Most importantly, constructing this project allows the license
for the Cooper Lake hydro facility to be renewed for 50 years.
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.)
Completion of this project ensures that the Cooper Lake Power Plant (CLPP) can continue to
operate. This project is a condition of the CLPP relicensing in 2007 and is required to know with
certainty that the CLPP is licensed to operate for an additional 50 years granted by the new
license. Certainty of ongoing CLPP hydroelectric production is essential as the plant produces
about 42,000 MWh per year, which offsets approximately 344,400 met of natural gas fired
generation.
As a result of the project, 18,285 acre-feet of water is expected to be diverted from Stetson
Creek to Cooper Lake and 10,256 acre-feet will be released from Cooper Lake to Cooper
Creek. This results in a net increase of 8,029 acre-feet for additional hydro generation. Based
on the 2012 year-end Form 12 for Cooper Lake, each acre-foot of water yielded 0.7497 MWh of
energy. Thus, the estimated incremental hydro generation from the additional 8,029 acre-feet of
water is 6,020 MWh per year. This offsets 49,364 met's of gas fired generation annually, based
on a heat rate of 8,200 btu/kWh .
Another benefit of the project is the enhancement of fish habitat in Cooper Creek. See section 5
of this grant application for elaboration on these benefits. The Kenai Peninsula economy will
also benefit from the construction of the project as it will take approximately 2 years and will
require several highly skilled craftsmen and construction workers.
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.
Bids for construction of this project were received in September 2012 and the project is currently
being constructed. The winning bidder was Twin Peaks Construction, Inc., which is
headquartered in Anchor Point. The current estimated cost to completion is $21,772,523. Thi s
amount includes $338,000 for instrumentation to meet performance/operations and
maintenance reporting requirements.
Through August, $8,344,432 has been spent on the project. This includes $6,607,673 of
Chugach funds, $576,080 from AEA as a renewable energy grant {Round IV} and $1,160,679
from a $5.825 million grant received from the State of Alaska in 2012. Of $17,045,146
budgeted for construction, Chugach is proposing to provide $13,591,226 and is requesting a
$3,453,920 renewable energy grant from AEA via this grant application.
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Grant Application-Standard Form
The $3,453,920 grant requested is based on Chugach's understanding that AEA will grant up to
$4 million combined for the design, permitting and construction phases. Since the $576,080
previously received included $546,080 for design and permitting, $3,453,920 is the balance of
the $4 million limit, and this is the grant amount being requested for construction.
Financing is not an issue for Chugach. Any funds Chugach is not able to secure through grants
will be provided by other financing options. Chugach has a $100 million commercial pape r
credit facility and a $50 million line of credit available. Short-term, any needed funds will come
from commercial paper as the current borrowing rate is 0.22%, which is cheaper than the line of
credit. As of September 19th, Chugach's outstanding commercial paper balance is $55 million
and the line of credit is unused.
Long-term financing will replace the short-term financing upon project completion, with timing
depending on market conditions. Chugach has "investment grade" credit ratings. Current credit
ratings on long-term debt are from Standard and Poor's Rating Services of A-(Stable) and from
Fitch Ratings of A-(Positive).
If Chugach is unable to secure additional grant funds Chugach will nevertheless continue with
the project using the best funding available.
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 $ 3,453,920
2.7.2 Cash match to be provided $13,591,226
2.7.3 In-kind match to be provided $
2.7.4 Other grant funds to be provided $
2.7.5 Other grant applications not yet approved $
2.7.6 Total Grant Costs (sum of 2.7.1 through 2.7.4} $17,045,146
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 $21,772,523
4 4.4, including estimates through construction.
2.7.8 Additional Performance Monitoring Equipment not covered $338,000 budget included
by the project but required for the Grant Only applicable to for instrumentation.
construction phase projects.
2.7.9 Estimated Direct Financial Benefit (Savings} $97,305,114 (NPV through
2057 -life of new license).
See exhibit "Value of
CLPP Production"
2.7.10 Other Public Benefit If you can calculate the benefit in terms Reduced carbon
of do/Jars please provide that number here and explain how you emissions, enhanced
calculated that number in Section 5 below. recreation/fish habitat;
jobs benefit for two
AEA 2014-006 Grant Application Page 5 of22 7/1/2013
Renewable Energy Fund Round VII
Grant Application-Standard Form 1~:; A LJhSKA:~
~ENERGY AUTHORITY
j construction seasons.
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 resume s
as separate PDFs if the applicant would like those excluded from the web posting of thi s
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.
Chugach's project manager is Peter Poray, Plant Manager for Peaking and Hydro Units. Mr.
Poray has been working on this project for the past several years. The executive manager fo r
this effort is Paul Risse, Sr. Vice President of Power Supply. Their professional bios are
attached.
Contact information for the primary contact is as follows:
Peter Poray
P.O Box 196300
Anchorage, AK 99519-6300
(907) 762-4788
Peter poray@chuqachelectric.com
3.2 Project Schedule and Milestones
Pl ease fill tfi "ded b 1 ou orm prov1 eow. y dd dd"f al oumaya a 11on d d rows as nee e .
Milestones Tasks
Pre-construction Management Submittal reviews, agency sub-plan
updates and approvals, personnel staffing,
FERC Authorization to Construct.
Construction General site costs and work: mobilization,
demobilization, clearing, dock construction,
SWPPP implementation, office set-up, site
grubbing, site condition surveys, fuel costs.
Siphon pipeline system construction: 30"
inside diameter piping installation and its
lake outlet and creek inlet structure,
connection to diversion pipeline,
instrumentation vaults & building, and
balance of siphon plant.
Diversion dam and intake structures:
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Date Date
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2013 Complete
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Renewable Energy Fund Round VII
Grant Application -Standard Form
excavation, rock anchoring, site prep, rock
drains, concrete dam construction, dam
mechanical and piping installations.
Access & diversion pipeline: 36" inside
diameter diversion pipe installation in lake,
diversion access road construction to
Stetson Creek, staging diversion pipe,
diversion pipeline excavation and install,
instrumentation vault & building and
balance of diversion pipeline plant.
Instrumentation Install metering, control systems & remote
power system. Test and commission.
Security Cameras Install camera mounting pole, cameras and
commission.
Project Close-out As-built documentation, construction
management and final documentation
Annual Operations Reporting
3.3 Project Resources
Jun May
2014 2015
Sep May
2014 2015
Apr Jun
2015 2015
Jun Jun
2016 2025
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 o r
contracts. Include brief resumes and references for known, key personnel, contractors, and
suppliers as an attachment to your application.
In addition to the key management personnel identified earlier, an organizational chart of
Chugach's extensive Power Supply Division is attached. Chugach has a great deal of
experience in the construction, operation and maintenance of both thermal and hydroelectri c
generation projects.
Chugach's direct contractors working on the project, all of which were selected by competitive
procurement, includ e:
• Twin Peaks Construction -providing construction services as the prime construction
contractor.
• MWH -providing construction management, engineering and inspection services.
• Energy Engineering Inc. -providing site management services (Chugach's site
manager).
• DOWL-HKM-providing material testing laboratory services and specialty inspectors.
• RMS-providing material testing laboratory services and specialty inspectors.
• QA Services-providing material testing laboratory services and specialty inspectors.
• Beacon-providing safety specialist services.
An organization chart of the project team and the resumes and references for key contractor
personnel are attached.
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Renewable En ergy Fund Round VII
Grant Application-Standard Form
Chugach also has extensive internal administrative expertise to support the project, including
the administration of a grant. Key areas of expertise within Chugach that will contribute to th e
project include grants administration, accounting, procurement, environmental and information
services.
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.
Chugach will keep the AEA apprised of the project's status by preparing routine reports that
conform to AEA's reporting requirements and by other exchanges of information on an as-
needed basis. Progress and financial reports will be timely and accurate.
Once the project is completed, performance monitoring reporting will be based on
instrumentation installed to measure water flows, operate a gate to control flows to upper
Cooper Creek, tie into the dam failure float sensors, log the data on site and transmit the data
back through the SCADA system to the plant network.
Contacts can be directed to either the Project Manager (Peter Poray) or the Grant Manager
(Ron Vecera). Contact information for each is provided in this grant application.
3.5 Project Risk
Discuss potential problems and how you would address them.
Bids were received in September 2012 which mitigated the risk of project cost greater than
expected. The primary remaining risk is the construction risk. Although the project is well
designed and planned there is always the possibility of unforeseen events, such as a storm, that
affects working conditions and impedes the project's progress. This risk is mitigated by hiring a
qualified contractor who is familiar with the adverse working conditions that can be encountered
in Alaska and having a realistic project schedule that includes some flexibility to ensure
milestones are timely completed.
SECTION 4-PROJECTDESCRIPTION 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.
The net increase of 8,029 acre-feet of additional water to Cooper Lake is expected to result in
incremental hydro generation estimated at 6,020 MWh per year. This incremental energy will be
generated by two existing 9.6 MW hydro units at the CLPP. Also, by satisfying a condition of the
AEA 2014-006 Grant Application Page 8 of22 7/1/2013
Renewable Energy Fund Round VII
Grant Application-Standard Form 1:2) AbASE·~
-.u ENERGY AUTHORITY
FERC relicensing of the CLPP, this plant will be able to continue to produce an average of 48,020
(6,020 incremental+ existing average of about 42,000) MWh per year of renewable hydroelectric
through 2057, the life of the extended license for the CLPP.
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.
The existing Cooper Lake project was commissioned in 1960 and consists of:
• A 920 foot-long rock and fill dam that raises the elevation of Cooper Lake to a licensed
maximum operating level of 1,190 feet mean sea level.
• Cooper Lake with a surface area of 2,910 acres.
• An intake structure on the southeast shore of Cooper Lake, a 10,686 foot-long tunnel
and penstock.
• A powerhouse located on the southwest shore of Kenai Lake containing two turbine
generators, each rated at 9.6 MW, which were repowered in 2000.
• A 6.3 mile-long, 69 kV transmission line extending from the powerhouse to the Quartz
Creek substation.
• A 90.4 mile-long 115 kV transmission line from the Quartz Creek substation to the
Anchorage substation.
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.
The project is to construct diversion and bypass structures that will provide additional water to the
existing energy resource. This will result in an estimated 6,020 MWh per year increase to the
energy that is generated and delivered annually with the existing energy system. The existing
energy system is currently producing about 42,000 MWh per year.
4.2.3 Existing Energy Market
Discuss existing energy use and its market. Discuss impacts your project may have on energy
customers.
The existing energy market includes Chugach's retail electric consumers and wholesale
customers Matanuska Electric, Homer Electric and the Seward Electric System. Matanuska and
Homer, however, will likely not be Chugach customers at the time of project completion, due to
the pending expiration of their wholesale power purchase agreements with Chugach.
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Grant Application -Standard Form
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
• Delive_!Y methods
The proposed system includes diversion and bypass structures that will result in an increase in
the water volume of Cooper Lake and is expected to increase the energy output of the existi ng
CLPP, described in detail in 4.2.1, by an estimated 6,020 MWh per year. Construction is currently
taking place and there are no anticipated barriers to project completion.
The system design includes instrumentation to monitor performance and communicate data.
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.
The project is located within the Chugach National Forest. The following federal agencies have
all agreed to the project as part ofthe settlement agreement to relicense the CLPP .
• U.S. Department of Agriculture, Forest Service
• U.S. Department of the Interior, Fish and Wildlife Service
• U.S. Department of the Interior, National Park Service
• U.S. Department of Commerce, National Oceanic and Atmospheric Administration,
National Marine Fisheries Service
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
Other than some permits that will be needed during the course of construction, all permits have
been acquired. These include:
• U.S. Army Corps of Engineers, 404 Permit
• Alaska Department of Environmental Conservation 401 Water Quality Certification
• Alaska Department of Fish and Game Fish Habitat Permit
• U.S. Forest Service (USFS) Permits
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