HomeMy WebLinkAboutFERC Letter - Stetson Creek Construction�NLWOLA
POWERING ALISKA'$ FMR1
June 27, 2011
Honorable Kimberly D. Bose, Secretary
Federal Energy Regulatory Commission
888 First Street, NE
Washington, DC 20426
Subject: Cooper Lake Hydroelectric Project (FERC No. 2170), License Condition No. 12,
Impracticability of Construction of the Stetson Creek Diversion, Pipeline, and
Cooper Lake Diversion Structures - Mutually acceptable proposal to construct the
Stetson Creek Diversion, Pipeline, and Cooper Lake Diversion Structures as
identified in the Project license
Dear Secretary Bose:
Appendix A, Condition No. 12—Impracticability of Construction of the Stetson Creek Diversion,
Pipeline, and Cooper Lake Diversion Structures —of Chugach Electric Association's (Chugach)
Cooper Lake Project (Project) license (issued August 24, 2007) provides that within 20 days of
discovery, Chugach shall notify FERC and the Parties to the Cooper Lake Relicensing
Settlement Agreement (Parties), in writing, if the Stetson Creek diversion structure, pipeline, and
Cooper Lake bypass (Diversion and Bypass) structures cannot be built due to permitting, legal
prohibitions, or lack of necessary water rights, or if the total capital cost of engineering,
permitting, procuring, and constructing the Diversion and Bypass exceeds $11.04 million in
2004 dollars.
Upon such written notification, the license requires Chugach to initiate consultation with the
Parties within 30 days and conduct consultation so that Chugach can file with FERC, within 90
days of notifying FERC and the Parties, a mutually acceptable request for time extension,
alternative mitigation proposals, modifications to the Diversion and Bypass, or license
amendment (if required). Chugach must allow 30 days for the Parties to comment and to make
recommendations before filing an implementation schedule, documentation of consultation,
copies of comments, and recommendations on proposed plans and specific descriptions of how
the Parties' comments are accommodated by the plans.
Following the consultation required by Condition 12, Chugach and the Parties have agreed that
Chugach will construct the Stetson Creek Diversion, Pipeline, and Cooper Lake Diversion
Structures according to the specifications and schedule (as amended) identified in the license.
Chugach will design the project in accordance with all requirements included in the license, with
improvements identified during feasibility studies, and file a final design with FERC by
Chugarh Elechc Asscciation, Inc-
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August 24, 2012. The engineering developments and consultation process that led to this
decision are discussed below.
On March 14, 2011, Montgomery Watson Harza (MWH) submitted to Chugach a final Stetson
Creek Diversion and Cooper Lake Dam Facilities Feasibility Study report. Based on MWH's
analysis, completing the diversion, pipeline, and bypass will cost between $16.4 and $23.9
million (2010$), which exceeds the feasibility limit of $12.74 million (2010$) set forth in
Appendix A, Condition 12 of the License (i.e., $11.04 million 2004$).
The increase in cost is due primarily to (1) unforeseen logistical challenges associated with
establishing a pipeline from the proposed Stetson Creek diversion dam to Cooper Lake,
including support for rock cutslopes and measures to address construction conditions on steep,
unconsolidated slopes, (2) facilities required to maintain suitable hydraulic conditions at the
diversion pipe's outlet into Cooper Lake, (3) design refinements to the Cooper Lake Dam outlet
structure required by FERC's Division of Dam Safety & Inspections, Portland Regional Office
staff, (4) consumer price impact on construction materials, and (5) construction material quantity
increases due to design refinements and logistical challenges associated with the pipeline.
The following consultation steps were conducted by Chugach to meet the requirements of
Condition 12:
• April 1, 2011 - Chugach notified the Parties in writing regarding the March 14, 2011
determination that completion of the Stetson Creek Diversion and Bypass would exceed
the $11.04 million ($2004) threshold, thereby initiating consultation as required under
Condition 12 of the license (letter provided as Attachment A).
• April 20, 2011 - Chugach held a meeting with the Parties at its Anchorage, Alaska offices
to discuss potential alternative mitigation proposals to the Stetson Creek Diversion and
Bypass (meeting summary provided as Attachment B).
• May 2, 2011 - Chugach provided the Parties with a table of potential Cooper Lake
mitigation options that could be considered in lieu of the Stetson Creek Diversion and
Bypass and requested a follow-up meeting/teleconference on May 24, 2011 to further
discuss mitigation options to the Stetson Creek Diversion and Bypass (letter provided as
Attachment Q.
• May 2, 2011 - The US Fish and Wildlife Service (USFWS) and National Marine
Fisheries Service (NMFS) provided their respective determinations regarding practicable
alternatives to the Stetson Creek Diversion and Bypass (USFWS and NMFS email
correspondence provided as Attachment D).
• May 24, 2011 - Follow-up meeting/teleconference with Parties to discuss mitigation
options to the Stetson Creek Diversion and Bypass (meeting summary provided as
Attachment E).
• May 25, 2011 - Chugach submitted to the Parties its proposal to construct the Stetson
Creek Diversion, Pipeline, and Cooper Lake Diversion Structures according to the design
and schedule (as amended) identified in the license (Attachment F).
• May 25, 2011 - June 21, 2011 - Parties submitted their concurrence with Chugach's
proposal to construct the Stetson Creek Diversion, Pipeline, and Cooper Lake Diversion
Structures according to the design and schedule (as amended) identified in the license
(Parties' responses provided as Attachment G).
In their May 2, 2011 email correspondence, the USFWS and NMFS communicated their belief
that the following two options were the only practicable alternatives to the current Stetson Creek
Diversion and Bypass that could be considered: (1) release sufficient water from Cooper Lake
into Cooper Creek to overcome cold water temperatures from Stetson Creek and restore
ecological function and fish production or (2) remove the [Cooper Lake] dam and return Cooper
Creek to its natural pre -Project condition. No other Parties to the Settlement Agreement
provided written feedback to Chugach prior to the May 24 meeting. At the May 24 meeting, the
USFWS and NMFS reaffirmed their positions (which they stated in writing on May 2, 2011) that
the only viable options to constructing the Stetson Creek Diversion and Bypass as described in
the license are to release sufficient water from Cooper Lake into Cooper Creek to overcome cold
water temperatures from Stetson Creek or decommission the Cooper Lake Project. Other Parties
concurred with the conclusions of the USFWS and NMFS.
Again, because no mutually acceptable request for time extension, alternative mitigation
proposals, or modifications to the Stetson Creek Diversion and Bypass were identified during the
consultation described above, Chugach plans to move forward with design and construction of
the Stetson Creek Diversion and Bypass project as described in the existing Project license.
Submittal of this document satisfies the license requirement for Chugach to file, within 90 days
of initiating consultation, as required by Appendix A, Condition 12 of the license, a letter
notifying FERC of the outcome of the consultation outlined above. This notification confirms
Chugach's intent to meet the August 24, 2012 deadline for filing the final Stetson Creek
Diversion and Bypass design and specifications with FERC.
Please contact me at (907) 762-4839 or at Trey_Acteson@chugachelectric.cwm if you have any
questions or require any further information.
Sincerely,
Trey Acteson
Plant Manager, Peaking ydro Plants
cc: Distribution list (attached)
Attachments:
A Cooper Lake Hydroelectric Project (FERC No. 2170), License Condition No.
12, Notification of Impracticability of Construction of the Stetson Creek
Diversion, Pipeline, and Cooper Lake Diversion Structures (dated April 1,
2011)
B Cooper Lake Project Condition 12 Meeting with Parties to the Cooper Lake
Relicensing Settlement Agreement, Chugach Electric Association Offices,
Anchorage, AK, April 20, 2011, Meeting Summary