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HomeMy WebLinkAboutNeck Lake GrantApplication4 September 14, 2010 Alaska Energy Authority Attn: Butch White, Grants Administrator AEA-11-005-RE Fund Grant Application Round 4 813 West Northern Lights Blvd Anchorage, AK 99503 RE: Neck Lake Hydroelectric Project Grant Application AEA-11-005-RE Fund Grant Application Round 4 Dear AEA: Enclosed in response to RFA AEA-11-005-RE Fund Grant Application Round 4 program, is an application requesting funding for the Neck Lake Hydroelectric Project. Enclosed with this letter are two hard copies and one CD with the document in PDF format. Enclosed as per the RFA, o Grant Application Form o Cost Worksheet (included in Section 10 – Appendices) o Grant Budget (included in Section 10 – Appendices) o Grant Budget Form Instructions o Other pertinent information If you have any questions, please call either Glen Martin (Resource Assessment & Permits) 360-385-1733 x122, or Bob Grimm (President) 360-385-1733 x120. Sincerely, Glen D. Martin Resource Assessment & Permits Enc. (as stated) Renewable Energy Fund Round IV Grant Application AEA 11-005 Application Page 1 of 18 7/21/2010 Application Forms and Instructions The following forms and instructions are provided to assist you in preparing your application for a Renewable Energy Fund Grant. An electronic version of the Request for Applications (RFA) and the forms are available online at: http://www.akenergyauthority.org/RE_Fund-IV.html Grant Application Form GrantApp4.doc Application form in MS Word that includes an outline of information required to submit a complete application. Applicants should use the form to assure all information is provided and attach additional information as required. Application Cost Worksheet Costworksheet4.doc Summary of Cost information that should be addressed by applicants in preparing their application. Grant Budget Form GrantBudget4.doc A detailed grant budget that includes a breakdown of costs by milestone and a summary of funds available and requested to complete the work for which funds are being requested. Grant Budget Form Instructions GrantBudgetInstructions4.pdf Instructions for completing the above grant budget form.  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 completion of each phase.  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.  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. 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 Grant Application Round IV AEA11-005 Grant Application Page 2 of 18 7/21/2010 SECTION 1 – APPLICANT INFORMATION Name (Name of utility, IPP, or government entity submitting proposal) ALASKA POWER COMPANY (APC)(a subsidiary of ALASKA POWER & TELEPHONE COMPANY) Type of Entity: UTILITY Mailing Address P.O. Box 3222, Port Townsend, WA 98368 Physical Address 193 Otto Street, Port Townsend, WA 98368 Telephone 360-385-1733 Fax 360-385-7538 Email glen.m@aptalaska.com 1.1 APPLICANT POINT OF CONTACT / GRANTS MANAGER Name Glen Martin Title Permitting & Licensing Manager Mailing Address P.O. Box 3222, Port Townsend, WA 98368 Telephone 360-385-1733 x122 Fax 360-385-7538 Email glen.m@aptalaska.com 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) 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); Yes 1.2.2. Attached to this application is formal approval and endorsement for its project by its 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. Yes 1.2.4. If awarded the grant, we can comply with all terms and conditions of the attached grant form. (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. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 3 of 18 7/21/2010 SECTION 2 – PROJECT SUMMARY This is intended to be no more than a 1-2 page overview of your project. 2.1 Project Title – (Provide a 4 to 5 word title for your project) Neck Lake Hydroelectric 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. This project is located 1.5 miles southwest of the community of Whale Pass on Prince of Wales Island, Alaska. The Project would supply power to the community of Whale Pass. 2.3 PROJECT TYPE Put X in boxes as appropriate 2.3.1 Renewable Resource Type Wind Biomass or Biofuels X Hydro, including run of river Transmission of Renewable Energy Geothermal, including Heat Pumps Small Natural Gas Heat Recovery from existing sources Hydrokinetic Solar Storage of Renewable Other (Describe) 2.3.2 Proposed Grant Funded Phase(s) for this Request (Check all that apply) Reconnaissance X Design and Permitting X Feasibility X Construction and Commissioning X Conceptual Design 2.4 PROJECT DESCRIPTION Provide a brief one paragraph description of your proposed project. APC proposes to construct a small run-of-river hydroelectric project at Neck Lake, a 1,000 acre lake located 1.5 miles southwest of the community of Whale Pass on Prince of Wales Island. The Project would supply power to the community of Whale Pass, and would offset diesel generation, which is currently the sole source of electricity. The relatively high and modulated flows from the lake combined with the steep drop at the lower end of the outlet stream provide a good opportunity for a small run-of-river hydroelectric development. Facilities would include an access road, intake structure, 400 feet of penstock, a containerized power plant, a tailrace channel, and upgrade of 4 miles of transmission line. The hydroelectric facilities will be designed to avoid interference with the existing salmon rearing and collection facilities operated at Neck Lake by the Southern Southeast Regional Aquaculture Association (SSRAA). APC conducted a reconnaissance study of the site in 2008, and determined that there is sufficient potential to almost always provide enough generation for Whale Pass loads (see Section 10 for a copy of the reconnaissance report). The Project will provide clean, renewable electricity, as well as rate stabilization and lower rates for APC’s Whale Pass customers. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 4 of 18 7/21/2010 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, etc.)  This project will reduce the cost of electricity to the residents of Whale Pass who presently pay $0.5673/kWh (excluding PCE subsidy). APC estimates that diesel generation would decrease by about 95% at current load levels, with some diesel required occasionally when flow in the stream is low. This would decrease fuel costs for APC, and those savings would be passed on to APC’s customers. APC estimates the annual savings at current rates would be approximately $23,000 in the first year of operation (equivalent to about 8.7 ¢/kWh), and the savings would increase as the cost of diesel fuel increases. Residential customers using less than 500 kWh/month would see only a small decrease in their bill, assuming that APC’s savings result in a comparable decrease in the PCE COPA rate. Commercial customers and residential customers using over 500 kWh/month would see greater savings. The State of Alaska would benefit from reduced draw on the PCE program. Currently, about 49% of APC’s Whale Pass retail sales are subject to COPA. The total savings to the State is estimated to be about $11,000/year at current rates. Lower energy costs could help stimulate economic development in Whale Pass. Customers who have discontinued APC service because of the high cost of power would likely reconnect if the Project is built. Other benefits to the Alaskan public would be a decrease in the environmental impacts of diesel generation by APC or self-generation by Whale Pass residents (e.g. air pollution, noise pollution, fuel spills, etc.). 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 total cost of the Project is estimated to be $2,440,000. APC proposes AEA grant funding of 80% of the total cost ($1,952,000), with APC providing the 20% balance out of its normal operating funds. The estimated funding by Phase is as follows: Phase AEA Grant Funds APC Matching Funds Total I – Reconnaissance (1) $0 $3,500 $3,500 II – Feasibility/Assessment (2)$108,000 $0 $108,000 III - Design and Permitting $90,000 $23,000 $113,000 IV – Construction $1,754,000 $461,500 $2,215,500 Total $1,952,000 $488,000 $2,440,000 (1) AP&T conducted a site reconnaissance in 2008. (2) Round 2 $108,000 grant awarded with no matching fund requirement The construction costs indicated in this application are based on the 2008 site reconnaissance. The proposed Phase II work could result in an optimum project arrangement with a cost significantly different than that shown. Ordinarily, APC would not include Phase IV in this grant request. However, APC believes this Project can be designed and permitted quickly and construction initiated in 2013, which is the time frame anticipated for the current round of grant funding. Therefore, APC requests funding for construction costs in this current application. Any Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 5 of 18 7/21/2010 changes to the expected construction cost of the Project that result from more detailed analyses in Phases II and III can be dealt with at the conclusion of those phases. APC was awarded $108,000 for conceptual design, environmental surveys, and a feasibility report in Round 2 of the REF grant program. To date, only a small amount of work has been conducted, since the grant documentation was not received until late October. We have adjusted the amounts of the grant request and matching funds for this round by the amounts of the Round 2 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. $1,844,000 2.7.2 Grant Funds from Round 2 $108,000 2.7.3 Other Funds to be provided (Project match) $488,000 2.7.4 Total Grant Costs (sum of 2.7.1 and 2.7.2) $2,440,000 Project Costs & Benefits (Summary of total project costs including work to date and future cost estimates to get to a fully operational project) 2.7.4 Total Project Cost (Summary from Cost Worksheet including estimates through construction) $2,440,000 2.7.5 Estimated Direct Financial Benefit (Savings) $7,400,000 2.7.6 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 your application (Section 5.) $3,620,000 Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 6 of 18 7/21/2010 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). 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. Greg Mickelson, APC’s V.P. of Power Operations will be the Project Manager for all phases of work. Mr. Mickelson is located in Klawock on POW, and is an engineer with extensive experience in project management and electrical generation, transmission and distribution. Mr. Mickelson has been a part of APC’s team for over 30 years and has been an essential part of their success. He has overseen numerous projects on POW, having been there since 1983, that have also had grant funding and is familiar with procedures put in place for their use. Please see Mr. Mickelson’s resume in Section 10. APC’s personnel will conduct all Phase II engineering work and will utilize contractors for the environmental studies in Phase II. Phase III final design and permitting will be conducted by APC’s experienced staff. Resume’s of key personnel are included in Section 10. Phase IV construction would be either by APC using personnel hired from the local communities, or by experienced contractors from the local communities with APC supervision. 3.2 Project Schedule Include a schedule for the proposed work that will be funded by this grant. (You may include a chart or table attachment with a summary of dates below.) A bar schedule of the expected design and construction sequence is provided in Section 10. The following summarizes key activities and dates of the schedule. Note that this schedule is for the entire development sequence; activities funded by this grant will be in Phases III and IV. Phase II will be funded by the $108,000 grant from Round 2 and APC matching contributions. Phase I: Reconnaissance: Completed Summer 2008 Phase II: Resource Assessment/Feasibility Analysis/Conceptual Design: 2011-2012 In late 2009 APC had a surveyor develop topographic mapping of the Project. Also during the summer of 2011, the conceptual design from the Phase I reconnaissance work by APC will be reviewed and augmented to develop a firm arrangement for presenting to permitting agencies. As part of this work, APC will coordinate extensively with SSRAA regarding the proposed development. In addition, a cost estimate will be prepared for the selected arrangement and an economic analysis conducted. The results will be presented in a feasibility report. At the same time, APC will work with the permitting agencies to develop study plans for environmental surveys to be conducted later in 2011-2012. These surveys may include fish surveys, wildlife assessments, botanical surveys, wetlands surveys, archaeological survey (initial SHPO review), and water quality testing. APC believes that environmental field surveys for this Project will be very limited, since the impact area is quite small, and there should be a wealth of information already available from permitting and operation of the SSRAA facilities. Also in 2011 or 2012, geotechnical investigations may be conducted at the intake and powerhouse areas. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 7 of 18 7/21/2010 Phase III: Permitting and Final Design: Fall 2011 – Summer 2013 In this phase, permits and land easements will be acquired, and final design documents prepared. Permits will include: COE Section 404 permit, ADFG fish habitat permit, ADNR land lease or easement, ADNR water rights, ACMP coastal zone consistency determination, and SHPO review. Final design will begin in Summer 2012 and will proceed into the summer of 2013 with the intent to start construction in the Fall of 2013. Phase IV: Construction: Fall 2013 – 2014 Once all permits are received and funding for this phase is secured, APC will place the order for generating equipment and begin off-site fabrication of the intake and powerhouse modules. On- site construction will begin in 2013 and continue through the end of 2014. The construction work should not be significantly compromised by weather at this temperate location. 3.3 Project Milestones Define key tasks and decision points in your project and a schedule for achieving them. The Milestones must also be included on your budget worksheet to demonstrate how you propose to manage the project cash flow. (See Section 2 of the RFA or the Budget Form.) Key (i.e. critical path) milestones for the Project are:  Completion of topographic mapping by October 2011  End of Phase II (decision point after completion of feasibility analysis)  Receipt of all necessary permits and land access agreements by August 2013  End of Phase III (decision point after completion of design and final cost estimate)  Award contract for supply of the generating equipment by August 2013  Completion of access road to intake site by November 2013  Completion of Powerhouse by October 2013  Completion of Diversion Structure by October 2013  Test and Startup by December 2013 The schedule described in 3.2 above is consistent with these milestones. 3.4 Project Resources Describe the personnel, contractors, 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. Key APC personnel involved in the project and their roles will be:  Greg Mickelson, Project Manager & Construction Superintendent  Bob Berreth, Electrical Design  Ben Beste, Mechanical Design  Larry Coupe, Civil Design  Glen Martin, Resource Assessment and Permits Resume’s can be found in Section 10. Phase I: Reconnaissance Already completed by APC. Phase II: Resource Assessment/Feasibility Analysis/Conceptual Design Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 8 of 18 7/21/2010 In this phase APC will acquire property access and complete environmental and engineering/conceptual design studies. APC may use the following contractors for the various surveys:  Wetlands delineation - - HDR Alaska Inc.  Threatened and endangered plant species survey - - HDR Alaska Inc.  Fish surveys - - Romey Associates, LLC (or possibly staff from SSRAA Hatchery)  Water quality sampling - - Analytica Group Environmental Laboratories  Cultural resource surveys - - Browne Research  Topographic mapping - - Sentec, Inc.  Geotechnical evaluation - - GeoEngineers, Inc. APC permitting specialists will compile the environment information into resource assessment documents as required by the various permitting agencies. APC engineers will conduct the engineering/conceptual design studies in-house. Phase III: Final Design & Permitting APC has filed for a jurisdictional determination from the Federal Energy Regulatory Commission (FERC), and expects to receive that determination by end of 2010. AP&T is confident that FERC will not have jurisdiction, and therefore a FERC license will not be required. Accordingly, in this phase the following permits will be acquired:  404 permit (Corps of Engineers)  Coastal zone consistency determination (ADNR-DCOM)  Fish habitat permit (ADF&G)  Land lease or easement (ADNR)  Water right (ADNR)  SHPO review APC will prepare the final design documents in-house using its staff civil, mechanical, and electrical engineers, who all have extensive experience in hydroelectric development. These engineers designed APC’s South Fork Hydroelectric Project which entered service in 2005, as well as APC’s Kasidaya Creek Hydroelectric Project which began service in October 2008. Phase IV: Construction Construction will be by local contractors and APC staff, as follows:  Access road - - local contractor(s) or force account  Intake fabrications - - Reynold Grey Machining and Services  Intake on-site construction - - local contractor(s) or force account  Penstock materials procurement - - APC  Penstock installation - - local contractor(s) or force account  Generating equipment procurement - - APC  Powerhouse fabrications - - Reynold Grey Machining and Services  Powerhouse construction - local contractor(s) and force account  Transmission line construction - - local contractor(s) and force account  Testing and start-up - - APC Reynold Grey Machining and Services is a welding and fabrication company in Port Townsend, Washington that APC has used frequently for similar work, including fabrication of container modules for diesel powerplants recently installed in Slana and Allakaket. Reynold Grey is located near APC’s engineering staff, who thereby can conveniently oversee the proposed fabrication work. APC will negotiate purchase orders for materials and equipment from vendors who have performed Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 9 of 18 7/21/2010 well on APC’s recent projects. 3.5 Project Communications Discuss how you plan to monitor the project and keep the Authority informed of the status. During Phases II and III, APC proposes to provide quarterly reports to AEA regarding the status of the work. APC has provided similar reports to AEA and other grant funding agencies in the past several years on other projects, and has established the necessary procedures for producing the report expeditiously. Besides the quarterly reports, at the completion of Phase II, APC will provide AEA with a copy of a report that includes the conceptual design drawings and cost estimate. At the completion of Phase III, APC will provide AEA with a copy of the final design drawings, specifications, and cost estimate, and the permits along with a request to release the grant funds. During Phase IV, communications within the team would consist of:  Weekly reports by the Environmental Compliance Monitor (as likely to be required by the ADF&G Fish Habitat Permit)  Bi-weekly conference calls among the Project Manager, Construction Superintendent, the Design Engineers, and SSRAA managers.  Periodic site visits by the Project Manager and Design Engineers. These internal discussions will form the basis of quarterly reports to AEA. The reports will show in a clear and concise manner progress made on the various tasks/milestones, the work to be accomplished in the ensuing quarter, and potential problems and corrective actions to be considered or implemented. Cost data will also be provided on a quarterly basis. Microsoft Project or similar software will be used to develop and maintain schedule and budget information; updating of the management files will be on a monthly basis. 3.6 Project Risk Discuss potential problems and how you would address them. Site Control – APC does not yet have development rights on the land, but will apply to ADNR for those rights. APC is confident that its development will not conflict with the SSRAA operation already on the site. Seismic – Project components will be designed appropriately for seismic activity, since the Project will be located in a moderate-risk seismic zone. Structures will be buried as much as possible to minimize seismic impacts. Underground Construction – The Project does not include underground construction, which can be fraught with cost overrun potential. Geotechnical investigations will be made at the diversion and powerhouse areas to provide an adequate level of knowledge about ground conditions at those sites. Inclement Weather – Working conditions in the Project area during the winter could cause brief interruptions of the construction schedule. If prolonged interruptions occur that could jeopardize the completion schedule, APC will add contractors or more personnel as necessary to get back on schedule. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 10 of 18 7/21/2010 SECTION 4 – PROJECT DESCRIPTION AND TASKS  Tell us what the project is and how you will meet the requirements outlined in Section 2 of the RFA.  The level of information will vary according to phase(s) of the project you propose to undertake with grant funds.  If you are applying for grant funding for more than one phase of a project provide a plan and grant budget form for completion of each phase.  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. Proposed Energy Resource: The Neck Lake site has the potential to generate perhaps 3.2 GWh per year with an installed capacity of 750 kW, however, that would be much greater than the required generation (currently about 300 MWh/yr) . APC will evaluate the optimum installed capacity during Phase II; at this time an installed capacity of 124 kW is planned. At this time the only viable alternative to the Project is considered to be continued diesel generation. The Project would eliminate diesel generation for almost all of the year and significantly reduce diesel generation for the remainder. Pros: Compared to diesel generation, the Project will have the following advantages:  less expensive to operate than diesel (lower O&M);  no need to purchase fuel;  no air emissions;  fewer hazardous substances;  no particulate matter emissions;  can come on-line after a power outage almost immediately, but diesel can’t;  lower and more stable electric rates for customers Cons: As with all hydroelectric projects, the initial cost of development is much higher than for diesel generation. APC has been aggressively extending it transmission system to most of the communities on Prince of Wales Island, and is planning to connect Coffman Cove by the end of 2010 and Naukati Bay possibly in 2012. Theoretically, the transmission system could be extended another 25 miles to Whale Pass from Naukati Bay, however, it would cost much more than the Project, and would likely be less reliable. 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. Existing Power Generation Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 11 of 18 7/21/2010 There are 3 gensets in APC’s Whale Pass diesel power plant, as follows: Unit #1 = JD4045, 70 kW, Installed 1995, 11.27 kWh/gal (averaged from 2008) Unit #2 = Cummins BT5.9, 100 kW, Installed 1995, 11.38 kWh/gal (averaged from 2008) Unit #3 = Cummins NT855-64, 160 kW, Installed 2008, 12.62 kWh/gal (avg. July/August 2008) 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. Diesel generation being the existing energy resource, this hydroelectric project will for nearly all of the year eliminate the use of diesel generators. At other times only one or more diesel gensets will be needed in addition to the hydro power. This will reduce the use of diesel and the frequency of their maintenance, including overhauls and replacement. The diesel generators that would be impacted are all owned and operated by APC in Whale Pass. The Project will reduce this area’s reliance on fossil fuels. APC also owns the transmission and distribution infrastructure, so no impacts will occur to existing energy infrastructure and resources. 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 for the Project is Whale Pass. Whale Pass is an isolated community on the northern end of POW, approximately 25 road miles above Naukati Bay. APC currently owns and operates all of the electrical infrastructure on the island. The Project will reduce fossil fuel consumption by the diesel power plant in Whale Pass by approximately 25,000 gallons per year. The existing diesel plant will be placed on standby status, reducing APC’s diesel operations and maintenance costs. Currently, Whale Pass customers pay $0.5673 per kWh (excluding PCE subsidy). Whale Pass residential customers who use less than 500 kWh/month will see only a small decrease in their electric bills, since the PCE COPA would decrease proportionally. Commercial customers and residential customers who use more than 500 kWh/month will see a larger decrease in their electric bills (up to 8.7 ¢/kWh in the first year of operation). Electric rates would be much more stable once the Project is in operation. 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 Renewable energy technology specific to location – The Project will be a conventional run-of- river hydroelectric project. Facilities to be constructed include: Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 12 of 18 7/21/2010  400 feet of single lane access road  Intake with fish screen, 34 cfs diversion capacity  350 feet of 30- inch diameter pipeline  Powerhouse with four 31-kW generating units, each consisting of a pump-as-turbine and synchronous generator  Upgrade of about 4 miles of transmission line from single-phase to three-phase. Hydroelectric technology is well developed, and provides most of the renewable energy generated in the world in general and in Alaska in particular. The Project will utilize the abundant rainfall and steep topography afforded by the falls on the Neck Lake outlet stream to generate renewable energy. Optimum installed capacity – 124 kW (to be confirmed by Phase II studies). Anticipated capacity factor – 28% (to be confirmed by Phase II studies). Anticipated annual generation – Approximately 300 MWh/yr, which would off-set about 25,000 gallons of diesel used per year. If Whale Pass loads grow, the Project would be able to generate as much as 1,000 MWh/yr with the proposed installed capacity of 124 kW. Anticipated barriers – No technological barriers. Basic integration concept – Integration of hydropower is not particularly difficult; APC already operates two independent integrated hydro-diesel systems. For much of the year the hydro generation will be much more than the load, and therefore the diesel generation will be on standby; one or more hydro units will be on-line, with any excess generation shunted to dummy resistance loads. During low flow periods, possibly during late summer and during parts of the winter when flow is low, the hydro generation may be placed in lag position with diesel taking the lead. During the transition periods, diesel unit(s) will be block loaded in lag position, with the hydro in lead position. Preliminary studies indicated that the Project would be able to replace about 99.5% of the diesel generation, excluding planned or forced outages. Delivery methods – Project generation will be delivered to Whale Pass via a 4-mile-long transmission line from the powerhouse to the existing distribution system. 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 on State land and APC will be applying for an easement or lease to use the land. 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 Applicable Permits:  404 permit (Corps of Engineers) Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 13 of 18 7/21/2010  Coastal zone consistency determination (ADNR-DCOM)  Water right (ADNR),  State land easement (ADNR)  Fish habitat permit (ADF&G)  SHPO review Permitting Timeline: APC expects to complete environmental and design studies in 2012 in order to have permits by summer 2013. Potential Permitting Barriers: There are no known permitting barriers 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 T&E Species: No impacts are anticipated to T&E species due to the projects location and small size. However, the agencies will be consulted prior to making any determination. Habitat Issues: The Southern Southeast Regional Aquaculture Association has established a rearing and trapping facility at the lake and outlet stream. Coho salmon smolts are reared in pens in the lake, then released into the lake for migration out to tidewater during the spring. When the adults return, they ascend a ladder into a single raceway, where they are quickly processed for shipment south. Water for the raceway and ladder is diverted from the head of the second (middle falls). A general arrangement of the SSRAA facilities is shown in the Reconnaissance Report located in Section 10 (it is a preliminary drawing and is not 100% accurate). SSRAA’s existing knowledge of fish usage of the stream is expected to be sufficient so that additional fish surveys will not be required. Wetlands: There is potential for a small amount of wetlands to be impacted. A wetlands delineation may be necessary to determine what, if any, impacts there may be. Archaeological & Historical Resources: A review by SHPO of this site will need to occur to determine if an archaeological survey will be necessary. Because of SSRAA’s existing use of much of the site, an archaeological survey is unlikely to be required. Land Development Constraints: APC will coordinate with SSRAA to make sure their needs and goals are not affected by construction and operation of the Project. Telecommunications Interference: The 12 kV transmission line will not create interference with telecommunications. Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 14 of 18 7/21/2010 Aviation Considerations: There is no significant aviation in the Project area. Visual, Aesthetic Impacts: The Project will not be in a visually or aesthetically special view shed that needs protection. Potential Barriers: None 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 Anticipated project costs:  Phase I:......................................$3,500 (APC records)  Phase II: ...............................$108,000 (APC estimate based on APC experience)  Phase III:...............................$113,000 (APC estimate based on APC experience)  Phase IV:...........................$2,215,500 (APC estimate based on APC experience)  Total: ................................ $2,440,000 Requested grant funding: ............$1,844,000 (excludes $108,000 Round 2 grant) Applicant matching funds: ...............$488,000 (total match for all grants) Other sources of funding: .................$108,000 Round 2 grant Projected capital cost:................... $2,219,000 (capital cost is assumed to be the cost of Phase IV – Construction) Projected development cost: ............$221,000 (development cost is assumed to be the total cost of Phases I, II, and III) 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.) The O&M cost for the hydro project is estimated to be $23,000 in the first year of operation (late 2014). APC will operate and maintain the Project with proceeds from sale of power to its Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 15 of 18 7/21/2010 customers. No grant funding is requested for operation and maintenance. 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 APC is developing this Project to supply power to a community it already serves. The power generated by the Project ultimately will be sold to APC’s customers in Whale Pass at a lesser cost than the current cost of diesel generation. APC estimates that the current retail price for electricity to Whale Pass customers could be reduced by 8.7¢/kWh if the Project is funded as proposed herein (excluding PCE). Rate of Return: Not calculated. 4.4.4 Project Cost Worksheet Complete the cost worksheet form which provides summary information that will be considered in evaluating the project. The Cost Worksheet is attached in Section 10. 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 (gal and $) 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 people of Alaska will benefit from the Project development as follows: Potential annual fuel displacement: Over the last 10 years, Whale Pass used an average of about 25,000 gallons of diesel fuel annually to generate an average of 306,000 kWh/year. For 2009, the most recent fuel price for Whale Pass average has been $2.97 per gallon. Over a 50 year period the Project could potentially save 1,500,000 gallons of diesel fuel valued at $8,700,000, assuming a 3.75% escalation rate in the price of diesel fuel and 0.5% annual load growth. Note that current fuel prices may be unusually low because of the global economic downturn; with a more robust global economy it is likely that fuel prices would increase much faster than the assumed 3.75%. Also, in keeping with AEA’s analysis method, the price of fuel has only been calculated to escalate for 20 years. Anticipated annual revenue: If funded as proposed herein, the Project is estimated to result in a decrease in generation costs of about $23,000 in the first year of operation. APC would expect to Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 16 of 18 7/21/2010 have a new rate tariff for Whale Pass that passes those savings on to the Whale Pass customers, i.e. APC’s revenues would decrease by $23,000 in the first year of operation. Potential additional annual incentives: Not estimated. Potential additional revenue streams : Not estimated. Non-economic public benefits to Alaskans: Reduced air emissions and noise, reduced chance for oil spills. Other benefits: The State of Alaska would spend less on the PCE program, since the Project generation would decrease the amount of diesel generation subject to PCE reimbursement. PCE savings are estimated to be $3,620,000 over the 50-year life of the Project. In the short term the local economy would benefit due to local hire for construction. In the long term, lower and more stable electric rates could lead to more residential and commercial development, which in turn would add more income to this community. 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 APC will operate the Project to supply power to APC’s grid in Whale Pass for eventual sale to its retail customers. APC will maintain the Project as it does with its other hydroelectric resources, which can be expected to have a life of at least 50 years. The Project will be remotely operated, with continuous monitoring by a SCADA system. O&M personnel will visit the plant at least once per week for routine checks on the equipment. A routine maintenance schedule will be established, a brief annual shutdown is likely for maintenance. 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. APC visited the Project site, coordinated with SSRAA, and prepared a reconnaissance report in 2008. We expected to begin the Phase II Feasibility Work in early 2009 if grant funds were made available. Although we were awarded $108,000 from the Round 2 REF grants for Phase II work, the grant documents were not received until late October 2009. As a result, the expected development schedule has slipped one year. We are currently planning to have topographic surveying work conducted later in 2011 or early in 2012, and will complete the Phase II work by Renewable Energy Fund Grant Application Round IV AEA11-005 Grant Application Page 17 of 18 7/21/2010 the end of 2012. SECTION 8– LOCAL SUPORT Discuss what local support or possible opposition there may be regarding your project. Include letters of support from the community that would benefit from this project. Since the proposed project would decrease electric rates and use a waterway that is already developed for aquaculture by SSRAA, we would not expect any local opposition unless the proposed project interferes with SSRAA’s operation. We fully expect to design a project that avoids interference and is “junior” in priority to SSRAA’s operation. In our discussions to date with SSRAA, they have been supportive of hydroelectric development as long as it does not interfere. SSRAA has hydro generation at other facilities of theirs, and they understand the benefits that they and the community would gain. SECTION 9 – GRANT BUDGET Tell us how much you want 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. Include an estimate of budget costs by milestones using the form – GrantBudget3.doc Total Project Costs: $2,440,000 Investments to date and funding sources: APC has spent approximately $3,500 to date on Phase I development activities for the Project. To date, all costs have been paid out of APC’s general operations funds. Amount requested in grant funds: $108,000 Phase II (Round 2 grant) $90,000 Phase III (proposed this Round 3) $1,754,000 Phase IV (proposed this Round 3) $1,952,000 Total Additional investment by APC: APC will provide matching funding equaling 20% of the total cost of Project development ($488,000). This matching amount will be paid from APC’s general operations funds. [AUTHORIZED SIGNATURES] Grant Documents Authorized Signers Please clearly print or type all sections of this form. Community/Grantee Name: ALASKA POWER COMPANY Regular Election is held: Annually / Board of Dir. IDate: September 14, 2010 Authorized Grant Si Printed Name Title Term Glen Martin Permitting I Lic.ensing / PermanenEnvlfonnfental KeVleW Robert S. Grimm CEO I President Permanen I authorize the above person(s) to sign Grant Documents: (Highest ranking organization/community/municipal official) Printed Name Title Term Robert S. Grimm CEO I President Permanent Grantee Contact Information' . Mailing Address: P.o. Box 3222, Port Townsend, WA 98368 Phone Number: (360) 385-1733 x122 Fax Number: (360) 385-7538 E-mail Address: glen.m@aptalaska.com Federal Tax 10 #: 92-0153693 Please submit an updated form whenever there is a change to the above information. Please return the original completed form to: Alaska Energy Authority ALASKA813 W. Northern Lights Blvd. ENERGY AUTHORITYAnchorage, AK 99503 Attn: Butch White, Grants Adminjstrator H:\GRANTSIAEA Round IV Renewable Energy Grants LOIO\Grant_Authorized_Signers4.doc APPENDICES TABLE OF CONTENTS 1. Certificate of Public Convenience & Necessity 2. Corporate Resolution 3. Project Maps 4. Project Description 5. Permits 6. Schedule 7. Letter’s of Support 8. Resume’s 9. Cost Worksheet 10. Grant Budget Form CERTIFICATE OF PUBLIC CONVENIENCE & NECESSITY CORPORATE RESOLUTION PROJECT MAPS PROJECT DESCRIPTION PROJECT DESCRIPTION Alaska Power & Telephone Company (AP&T) proposes to construct a small run-of-river hydroelectric project at Neck Lake in the outfall stream below the lake, which is located 1.5 miles southwest of the community of Whale Pass on Prince of Wales Island, Alaska. The Project would supply power to the community of Whale Pass and would offset diesel generation, which is currently the sole source of electricity. The relatively high and modulated flows from the lake combined with the steep drop at the lower end of the outlet stream provide a good opportunity for a small run-of-river hydroelectric development. Facilities would include an access road, intake structure, 400 feet of penstock, a containerized power plant with generator rated at 124 kW – 400 kW, a tailrace channel, and upgrade of 4 miles of transmission line. The hydroelectric facilities will be designed to avoid interference with the existing salmon rearing and collection facilities operated at Neck Lake by the Southern Southeast Regional Aquaculture Association (SSRAA). AP&T conducted a reconnaissance study of the site in 2008, and determined that there is sufficient potential to almost always provide enough generation for Whale Pass loads. The Project will provide clean, renewable electricity, as well as rate stabilization and lower rates for AP&T’s Whale Pass customers. PERMITS State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management CPQ Revised 8/15/2008 Page 1 of 18 Coastal Project Questionnaire and Certification Statement The Coastal Project Questionnaire (CPQ) is a diagnostic tool that will identify the state and federal permit requirements for your project that are subject to a consistency review. You must answer all questions. If you answer “Yes” to any of the questions, please call that specific department for further instructions to avoid delay in processing your application. You can find an agency contact list online at http://alaskacoast.state.ak.us/Contacts/PRCregcont.html. A complete project packet includes accurate maps and plan drawings at scales large enough to show details, copies of your state and federal permit applications, your answers to this questionnaire, and a complete consistency evaluation. DCOM will notify you within 21 days of receipt if the packet is incomplete and what information is still required. For additional information or assistance, you may call or email the Juneau Project Review at (907) 465-2142, or the Anchorage Project Review at (907) 269-7478. This CPQ document contains numerous hyperlinks (underlined text that has a connection to an internet web page) and is best viewed on-line. Additional instructions are available at http://www.alaskacoast.state.ak.us/Projects/pcpq.html  APPLICANT INFORMATION 1. Alaska Power & Telephone Company Name of Applicant P.O. Box 3222 Address Port Townsend, WA 98368 City/State/Zip 360-385-1733 x122 Daytime Phone 360-385-7538 glen.m@aptalaska.com Fax Number E-mail Address 2. Agent (or responsible party if other than applicant) Address City/State/Zip Daytime Phone Fax Number E-mail Address  PROJECT INFORMATION Yes No 1. This activity is a: new project modification or addition to an existing project 2. If this is a modification or an addition, do you currently have any State, federal or local approvals for this activity? NOTE: Approval means any form of authorization. If "yes," please list below: Approval Type Approval # Issuance Date Expiration Date 3. If this is a modification, was this original project reviewed for consistency with the Alaska Coastal Management Program? ............................................................................................................................................................................. Previous ACMP I.D. Number: (example: AK 0706-05AA or ID2004-0505JJ) Previous Project Name: Previous Project Applicant:  PROJECT DESCRIPTION Attach a complete and detailed narrative description of your new project or of your modification/addition including ALL associated facilities and changes to the current land or water use (if not already attached as part of an agency application). Clearly delineate the project boundaries and all property owners, including owners of adjacent land, on the site plan. The scale of the maps and plan drawings must be large enough to show pertinent details. Identify your proposed footprint or State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management CPQ Revised 8/15/2008 Page 2 of 18 disturbed area. If this project is a modification to an approved project, identify existing facilities and proposed changes on the site plan. Proposed starting date for project: 2010 Proposed ending date for project: 2011 (operations would begin)  PROJECT LOCATION and LAND OWNERSHIP Yes No 4. Describe/identify the project location on a map (Including nearest community, the name of the nearest land feature or body of water, and other legal description such as a survey or lot number.). Township T66S Range R79E Section 35 Meridian CRM Latitude/Longitude / (specify Decimal Degrees or Degrees, Minutes, Seconds) USGS Quad Map Petersberg (A-4) 5. The project is located on: State land or water* Federal land Private land Municipal land (Check all that apply) Mental Health Trust land University of Alaska land Contact the applicable landowner(s) to obtain necessary authorization. State land ownership can be verified using Alaska Mapper. *State land can be uplands, tidelands or submerged lands to 3 miles offshore. 6. Is the project within or associated with the Trans Alaska Pipeline corridor? ......................................................................  COASTAL DISTRICT Yes No 7. Is the project located in a coastal district? ................................. ……………………………………................................. If yes, identify the applicable coastal district(s) Thorne Bay and contact them to ensure your project conforms with district policies and zoning requirements. Coastal districts are a municipality or borough, home rule or first class city, second class municipality with planning powers, or coastal resource service area. A coastal district is a participant in the State's consistency review process. Early interaction with the district can benefit you significantly; please contact the district representative listed on the contact list at http://www.alaskacoast.state.ak.us/Contacts/PRCregcont.html  DEPARTMENT OF NATURAL RESOURCES (DNR) APPROVALS DNR DIVISION OF MINING, LAND & WATER- LAND SECTION Yes No 1. Is the proposed project on State-owned land or water or will you need to cross State-owned land for access? (NOTE: State land includes the land below the ordinary high water line of navigable streams, rivers and lakes, and in marine waters, below the mean high tide line seaward for three miles. State land does not include Alaska Mental Health Trust Land or University of Alaska Land.) ……………………………………………………………..……………………….. 2. If you answered yes to the question above, indicate the person you contacted at the appropriate Division of Mining, Land and Water regional office for information. a) Name/date of Contact: b) Is an application required for the proposed activity? ..................................................................................................... c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: DNR DIVISION OF MINING, LAND & WATER- MATERIALS SECTION Yes No 3. Do you plan to dredge or otherwise excavate or remove materials such as rock, sand, gravel, peat, or overburden from any land regardless of ownership? ...................................................................................................................................... a) Location of excavation site if different than the project site: Township Range Section Meridian 4. At any one site (regardless of land ownership), do you plan any of the following? ............................................................ Excavate five or more acres over a year’s time Excavate 50,000 cubic yards or more of materials (rock, sand, gravel, soil, peat, overburden, etc.) over a year’s time Have a cumulative, un-reclaimed, excavated area of five or more acres 5. Do you plan to place fill or excavated material on State-owned land? ............................................................................... a) Location of fill or material disposal site if different than the project site: Township Range Section Meridian 6. If you answered yes to any question above, indicate the person you contacted at the appropriate Division of Mining, Land and Water regional office for information. State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management CPQ Revised 8/15/2008 Page 3 of 18 a) Name/date of Contact: b) Is an application required for the proposed activity? ...................................................................................................... c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: DNR DIVISION OF MINING, LAND & WATER- MINING SECTION Yes No 7. Do you plan to mine for locatable minerals such as silver, gold, or copper? ..................................................................... 8. Do you plan to explore for or extract coal? ........................................................................................................................ 9. If you answered yes to any question above, indicate the person you contacted at the appropriate Division of Mining, Land and Water regional office for information. a) Name/date of Contact: b) Is an application required for the proposed activity? ...................................................................................................... c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: DNR DIVISION OF MINING, LAND & WATER- WATER SECTION Yes No 10. Will this project or development divert, impound, withdraw, or use any fresh water (regardless of land ownership)? (NOTE: If you know of other water users who withdraw from the same source or any potential conflicts affecting this use of water, contact the Water Section. If you are obtaining water exclusively from either an existing Public Water Supply or from a rainwater catchment system, you are not required to contact the DNR Water Section regional office.) ...................... a) Check all points-of-withdrawal or water sources that apply: Public Water system (name): Stream or Lake (name): outlet stream for Neck Lake Well Rain catchment system Other: b) Intended use(s) of water: hydroelectric project c) Amount (maximum daily, not average, in gallons per day): 34 cfs d) Is the point of water withdrawal on property you own? …………………………………………………………........... 11. Do you plan to build or alter a dam (regardless of land ownership)? ....................diversion structure……….................... 12. If you answered yes to any question above, indicate the person you contacted at the appropriate Division of Mining, Land and Water regional office for information. a) Name/date of Contact: b) Is an application required for the proposed activity? ....................................................................................................... c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: DNR DIVISION OF FORESTRY Yes No 13. Does your operation meet both of the following criteria on any land, regardless of ownership? a) The project will commercially harvest timber on 10 or more acres, or commercially harvest timber that intersects, encompasses, or borders on surface waters, and b) The project involves one or more of the following: site preparation, thinning, slash treatment, construction and maintenance of roads associated with a commercial timber harvest, or any other activity leading to or connected to a commercial timber harvest operation…………………………........................................................................................ 14. If you answered yes to any question above, indicate the person you contacted at the appropriate Division of Forestry regional office for information. a) Name/date of Contact: b) Is an application required for the proposed activity? ...................................................................................................... c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: DNR DIVISION OF OIL & GAS Yes No 15. a) Will you be exploring for or producing oil and/or gas? ………………………………………………………………... State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management CPQ Revised 8/15/2008 Page 4 of 18 b) Will you conduct surface use activities on/within an oil and gas lease or unit? ………………………………………. If yes, please specify: 16. Do you plan to drill a geothermal well (regardless of land ownership)? …………………………………………………. 17. If you answered yes to any question above, indicate the person you contacted at the appropriate Division of Oil & Gas office for information. a) Name/date of Contact: b) Is an application required for the proposed activity? …………………………………………………………………... c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: Visit the Division of Oil & Gas website for application forms and additional information. DNR OFFICE OF HISTORY & ARCHAEOLOGY Yes No 18. Will you investigate, remove, or impact historical, archaeological or paleontological resources (anything over 50 years old) on State-owned land? ………………………………………………………………………………………………… 19. If you answered yes to the question above, indicate the person you contacted at the State Historic Preservation Office for information. a) Name/date of Contact: DNR DIVISION OF GEOLOGICAL & GEOPHYSICAL SURVEYS Yes No 20. Is the proposed project located within a natural hazard area designated by a coastal district in the approved district plan? (Refer to the district plan or contact the coastal district office.) ……………………………………………………. a) If “yes”, describe the measures you will take in the siting, design, construction, and operation of the proposed activity to protect public safety, services, and the environment from potential damage caused by the designated natural hazard(s) in the Natural Hazards portion of the attached Coastal Consistency Evaluation (11 AAC 112.210). 21. If you have contacted someone, please indicate the person you contacted at the Coastal District or the State for information. The Division of Geological & Geophysical Survey may have additional information on hazards for the area. a) Name/date of Contact: DNR DIVISION OF PARKS & OUTDOOR RECREATION Yes No 22. Is the proposed project located in a unit of the Alaska State Park System including navigable waters, tidelands or submerged lands to three miles offshore? …………………………………………………………………………………. 23. If you answered yes to any question above, indicate the person you contacted at the appropriate DNR Division of Parks & Recreation office for information. a) Name/date of Contact: b) Is an application required for the proposed activity? …………………………………………………………………... c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: DNR APPROVALS List the Department of Natural Resources permits or authorizations required for your project below: Types of project approvals or permits needed. Date application submitted Water Rights Application DNR Land lease or easement  DEPARTMENT OF FISH AND GAME (DFG) APPROVALS Yes No 1. Is your project located in a designated State Game Refuge, Critical Habitat Area or State Game Sanctuary? …………... 2. Does your project include construction/operation of a salmon hatchery? ………………………………………………… 3. Does your project affect, or is it related to, a previously permitted salmon hatchery? …is next to a hatchery, but not expected to impact……………………………………………………………………………………………………… 4. Does your project include construction of an aquatic farm? ……………………………………………………………… State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management CPQ Revised 8/15/2008 Page 5 of 18 5. Will you work in, remove water or material from, or place anything in, a stream, river or lake? (NOTE: This includes work or activities below the ordinary high water mark or on ice, in the active flood plain, on islands, in or on the face of the banks, or, for streams entering or flowing through tidelands, above the level of mean lower low tide. If the proposed project is located within a special flood hazard area, a municipal floodplain development permit may be required. Contact the affected city or borough planning department for additional information and a floodplain determination.) …………………………………………………………………………………………………………….. a) If yes, name of waterbody: outlet stream of Neck Lake 6. If you answered yes to any questions above, indicate the person you contacted at the appropriate Department of Fish and Game office for information. (For projects involving Hatcheries or Aquatic Farms, please contact the Division of Commercial Fisheries. Other projects should contact the Division of Habitat.) a) Name/date of Contact: b) Is an application required for the proposed activity? …………………………………………………………………. c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: DFG APPROVALS List the Department of Fish and Game permits or authorizations required for your project below: Types of project approvals or permits needed. Date application submitted Habitat Permit  DEPARTMENT OF ENVIRONMENTAL CONSERVATION (DEC) APPROVALS DEC DIVISION OF WATER Yes No 1 a) Will a discharge of non-domestic wastewater to lands, waters, or the subsurface of the state occur? (NOTE: Non- domestic wastewater includes wastewater from commercial or industrial facilities, excavation projects, wastewater from man-made containers or containment areas, or any other non-domestic wastewater disposal activities see 18 AAC 72.990 for definitions.) …………………………………………………………………………………………... b) Will a discharge of domestic wastewater or septage to lands, waters or the subsurface of the state occur? (see 18 AAC 72.990 for definitions.) …………………………………………………………………………………………….. c) Will the wastewater disposal activity require a mixing zone or zone of deposit to meet Water Quality Standards (WQS)? (Many disposal activities require a mixing zone to meet WQS, contact DEC if unsure.) …………………….. d) Will the project include a stormwater collection/discharge system? …………………………………………………… e) Will the project include placing fill in wetlands? ……………………in the lake outlet stream……..…………………. f) Is the surrounding area inundated with water at any time of the year? …………………………………………………. g) Do you intend to construct, install, modify or use any part of a domestic or non-domestic wastewater treatment or disposal system? ………………………………………………………………………………………………………… 2. Does your project qualify for a general permit for wastewater? ............................................................... 3. If you answered yes to any questions above, indicate the person you contacted at the DEC-Division of Water for information. a) Name/date of Contact: b) Is an application required for the proposed activity? …………………DEC will go through the COE for permitting... c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: DEC does not want a permit application, but will use the COE review process to issue a 401 Certification. DEC DIVISION OF ENVIRONMENTAL HEALTH Yes No 4 a) Will your project result in construction, modification, or operation of a facility for solid waste disposal? (NOTE: State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management CPQ Revised 8/15/2008 Page 6 of 18 Solid waste means drilling wastes, household garbage, refuse, sludge, construction or demolition wastes, industrial solid waste, asbestos, and other discarded, abandoned, or unwanted solid or semi-solid material, whether or not subject to decomposition, originating from any source. Disposal means placement of solid waste on land.) ………. b) Will your project result in treatment of solid waste at the site? (Examples of treatment methods include, but are not limited to: incineration, open burning, baling, and composting.) ……………………………………………………… c) Will your project result in storage or transfer of solid waste at the site? ………………………………………………. d) Will the project result in storage of more than 50 tons of materials for reuse, recycling, or resource recovery? ……… e) Will any sewage solids or biosolids be disposed of or land-applied to the site? (NOTE: Sewage solids include wastes that have been removed from a wastewater treatment plant system, such as a septic tank lagoon dredge, or wastewater treatment sludge that contain no free liquids. Biosolids are the solid, semi- solid or liquid residues produced during the treatment of domestic septage in a treatment works which are land applied for beneficial use.) .. 5. Will your project require application of oil, pesticides, and/or any other broadcast chemicals? …………………………. 6. Does your project qualify for a general permit for solid waste? ................................................................ 7. If you answered yes to any question above, indicate the person you contacted at the DEC- Division of Environmental Health for information. a) Name/date of Contact: b) Is an application required for the proposed activity? …………………………………………………………………... c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: DEC DIVISION OF AIR QUALITY Yes No 8 a) Will you have an asphalt plant designed to process no less than five tons per hour of product? ……………………… b) Will you have a thermal remediation unit with a rated capacity of at least five tons per hours of untreated material? .. c) Will you have a rock crusher with a rated capacity of at least five tons per hour? …………………………………….. d) Will you have one or more incinerators with a cumulative rated capacity of 1,000 pounds or more per hour? ……….. e) Will you have a coal preparation plant? ………………………………………………………………………………... f) Will you have a Port of Anchorage stationary source? …………………………………………………………………. g) Will you have a facility with the potential to emit no less than 100 tons per year of any regulated air contaminant?..... h) Will you have a facility with the potential to emit no less than 10 tons per year of any hazardous air contaminant or 25 tons per year of all hazardous air contaminants?........................................................................................................ i) Will you be constructing a new stationary source with a potential to emit greater than: ……………………………… 15 tons per year (tpy) of PM-10 40 tpy of nitrogen oxides 40 tpy of sulfur dioxide 0.6 tpy of lead; or 100 tpy of CO within 10 km of a nonattainment area j) Will you be commencing construction, or (if not already authorized under 18 AAC 50) relocating a portable oil and gas operation? (answer “yes” unless you will comply with an existing operating permit developed for the portable oil and gas operation at the permitted location; or you will operate as allowed under AS 46.14.275 without an operating permit) ……………………………………………………………………………………………………….................... k) Will you be commencing construction or (if not already authorized under 18 AAC 50) relocating an emission unit with a rated capacity of 10 million Btu or more per hour in a sulfur dioxide special protection area established under 18 AAC 50.025? ………………………………………………………………………………………………………… l) Will you be commencing a physical change to or a change in the method of construction of an existing stationary source with a potential to emit an air pollutant greater than an amount listed in g) that will cause for that pollutant an emission increase (calculated at your discretion) as either an increase in potential to emit that is greater than: 10 tpy of PM-10 10 tpy of sulfur dioxide 10 tpy of nitrogen oxides; or 100 tpy of CO within 10 km of a nonattainment area; or actual emissions and a net emissions increase greater than: 10 tpy of PM-10 10 tpy of sulfur dioxide 10 tpy of nitrogen oxides; or State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management CPQ Revised 8/15/2008 Page 7 of 18 100 tpy of CO within 10 km of a nonattainment area m) Will you be commencing construction or making a major modification of a Prevention of Significant Deterioration stationary source under 18 AAC 50.306? ……………………………………………………………………………….. n) Will you be commencing construction or making a major modification of a nonattainment area major stationary source under 18 AAC 50.311? …………………………………………………………………………………………... o) Will you be commencing construction or reconstructing a major stationary source under 18 AAC 50.316, for hazardous air pollutants? Definition of Regulated Air Pollutants can be found at http://www.epa.gov/ttn/oarpg/t5/memoranda/rapdef.pdf .................................................................................................. 9. If you answered yes to any questions above, indicate the person you contacted at the DEC- Division of Air Quality for information. a) Name/date of Contact: b) Is an application required for the proposed activity? …………………………………………………………………… c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: DEC DIVISION OF SPILL PREVENTION AND RESPONSE Yes No 10 a) Will your project involve the operation of waterborne tank vessels or oil barges that carry crude or non crude oil as bulk cargo, or the transfer of oil or other petroleum products to or from such a vessel or a pipeline system? …………. b) Will your project require or include onshore or offshore oil facilities with an effective aggregate storage capacity of greater than 5,000 barrels of crude oil or greater than 10,000 barrels of non-crude oil? ……………………………….. c) Will you operate facilities on land or water for exploration or production of hydrocarbons? …………………………. 11. If you answered yes to any questions above, indicate the person you contacted at the DEC-Division of Spill Prevention and Response office for information. a) Name/date of Contact: b) Is a plan required for the proposed activity? …………………………………………………………………… c) If “YES” then submit a signed copy of the completed Oil Discharge Prevention & Contingency Plan to the DCOM. If “No”, explain why an application isn’t required. Explanation: DEC APPROVALS List the Department of Environmental Conservation permits or authorizations required for your project below: Types of plan approvals or permits needed Date application submitted  FEDERAL APPROVALS U.S. ARMY CORPS OF ENGINEERS (USACE) Yes No 1. Will you discharge dredged and/or fill material or perform dredging activities in waters of the U.S? Section 404 of the Clean Water Act requires that a Department of the Army permit be obtained for the placement or discharge of dredged and/or fill material into waters of the U.S., including wetlands (33 U.S.C. 1344). (Your application to the USACE would also serve as application for DEC Water Quality Certification.) …………………………………. 2. Will you place fill or structures or perform work in waters of the U.S? Section 10 of the Rivers and Harbors Act of 1899 requires that a Department of the Army permit be obtained for structures or work in or affecting navigable waters of the U.S. (33 U.S.C. 403) (Waters of the U.S. include marine waters subject to the ebb and flow of the tide, rivers, streams, lakes tributaries, and wetlands. If you are not certain whether your proposed project is located within a wetland, contact the USACE Regulatory Division to request a wetlands determination. For additional information about the Regulatory Program, visit www.poa.usace.army.mil/reg) ……………………………………….. 3. If you answered yes to the question above, indicate the person you contacted at the US Army Corps of Engineers for information. a) Name/date of Contact: b) Is an application required for the proposed activity? …………………………………………………………………… State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management CPQ Revised 8/15/2008 Page 8 of 18 c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: BUREAU OF LAND MANAGEMENT (BLM) Yes No 4. Is the proposed project located on BLM land, or will you need to cross BLM land for access? …………………………. 5. If you answered yes to the question above, indicate the person you contacted at the Bureau of Land Management for information. a) Name/date of Contact: b) Is an application required for the proposed activity? …………………………………………………………………… c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: U.S. COAST GUARD (USCG) Yes No 6 a) Do you plan to construct a bridge or causeway over tidal (ocean) waters, or navigable rivers, streams or lakes? ……... b) Does your project involve building an access to an island? ……………………………………………………………. c) Do you plan to site, construct, or operate a deepwater port? …………………………………………………………… 7. If you answered yes to any question above, indicate the person you contacted at the appropriate US Coast Guard office for information. a) Name/date of Contact: b) Is an application required for the proposed activity? …………………………………………………………………… c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: U.S. ENVIRONMENTAL PROTECTION AGENCY (EPA) Yes No 8 a) Will the proposed project have a discharge to any waters? ……………………………………………………………... b) Will you dispose of sewage sludge? ……………………………………………………………………………………. c) Will construction of your project expose 1 or more acres of soil? (NOTE: This applies to the total amount of land disturbed, even if disturbance is distributed over more than one season, and also applies to areas that are part of a larger common plan of development or sale.) …………………………………………………………………………... d) Is your project an industrial facility that will have stormwater discharge directly related to manufacturing, processing, or raw materials storage areas at an industrial plant? If you answered yes to c) or d), your project may require an NPDES Stormwater permit ……………………………………………………………………………………………… 9. If you answered yes to any question above, indicate the person you contacted at the US Environmental Protection Agency for information. a) Name/date of Contact: b) Is an application required for the proposed activity? ……………EPA will go through COE……………………… c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: FEDERAL AVIATION ADMINISTRATION (FAA) Yes No 10 a) Is your project located within five miles of any public airport? ……………………………………………………… b) Will you have a waste discharge that is likely to decay within 5,000 feet of any public airport? …………………… 11. If you answered yes to the question above, indicate the person you contacted at the Federal Aviation Administration for information. a) Name/date of Contact: FEDERAL ENERGY REGULATORY COMMISSION (FERC) Yes No 12 a) Does the project include any of the following: ………………………………………………………………………… 1) a non-federal hydroelectric project on any navigable body of water 2) locating a hydro project on federal land (including transmission lines) 3) using surplus water from any federal government dam for a hydro project b) Does the project include construction and operation, or abandonment of interstate natural gas pipeline facilities under sections 7 (b) and (c) of the Natural Gas Act (NGA)? .....……………………………………………………… State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management CPQ Revised 8/15/2008 Page 9 of 18 c) Does the project include construction and operation of natural gas or liquefied natural gas importation or exportation facilities under section 3 of the NGA? ......................................................................................................... d) Does the project include construction for physical interconnection of electric transmission facilities under section 202 (b) of the FPA? …………………………………………………………………………………………………… 13. If you answered yes to any question above, indicate the person you contacted at the appropriate Federal Energy Regulatory Commission office for information. a) Name/date of Contact: b) Is an application required for the proposed activity? ………………………………………………………………..… c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: U.S. FOREST SERVICE (USFS) Yes No 14 a) Does the proposed project involve construction on USFS land? ……………………………………………………….. b) Does the proposed project involve the crossing of USFS land with a water line? ……………………………………... c) The current list of Forest Service permits that require ACMP consistency review are online at http://alaskacoast.state.ak.us/Clawhome/handbook/pdf/11_AAC_110.pdf in Article 4, 11 AAC 110.400, pages 28-30. Does your proposed project include any of Forest Service authorizations found on pages 28-30 of the ACMP Handbook? ……………………………………………………………………………………………………………… 15. If you answered yes to any question above, indicate the person you contacted at United States Forest Service for information. a) Name/date of Contact: b) Is an application required for the proposed activity? …………………………………………………………………… c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: U.S. FISH AND WILDLIFE SERVICE (USFWS) Yes No 16 a) Is your proposed project on land managed by the USFWS? ……………………………………………………………. b) Does your project require a Right of Way from the USFWS under 50 C.F.R. 29 and 50 C.F.R 36? .............................. 17. If you answered yes to any question above, indicate the person you contacted at the US Fish and Wildlife Service for information. a) Name/date of Contact: b) Is an application required for the proposed activity? …………………………………………………………………… c) If “YES” then submit a signed copy of the completed application to the DCOM. If “No”, explain why an application isn’t required. Explanation: OTHER FEDERAL AGENCY APPROVALS Yes No 18 a) Other Federal agencies with authorizations reviewable under the Alaska Coastal Management Program are posted online at http://alaskacoast.state.ak.us/Clawhome/handbook/pdf/11_AAC_110.pdf in Article 4, 11 AAC 110.400, pages 28-30. Does your proposed project include any of the Federal agency authorizations found on pages 28-30 of the ACMP Handbook? …………………………………………………………………………………………………... b) If yes, which federal authorizations? COE Permit State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management CPQ Revised 8/15/2008 Page 10 of 18 19. Have you applied for any other federal permits or authorizations? ……………………………………………………….. Agency Approval Type Date Submitted COE Individual Permit Will apply for. Note: The Coastal Project Questionnaire (CPQ) identifies state and federal permits subject to a consistency review. You may need additional permits from other agencies or the affected city and borough government to proceed with your activity. Attach the documentation requested under the Project Description. ACMP Consistency Evaluation & Certification Statement Pursuant to 11 AAC 110.215 (a)(1)(c), the applicant shall submit an evaluation of how the proposed project is consistent with the statewide standards at 11 AAC 112.200 - 11 AAC 112.990 and with the applicable district enforceable policies, sufficient to support the consistency certification. Evaluate your project against each section of the state standards and applicable district enforceable policies using the template below or by submitting a narrative description in letter or report form. District enforceable policies are available on the ACMP website at http://www.alaskacoast.state.ak.us. Definitions of key terms can be found at: 11 AAC 110.990, 11 AAC 112.990 and 11 AAC 114.990. If you need more space for an adequate explanation of any of the applicable standards, please attach additional pages to the end of this document. Be sure to include references to the specific sections and subsections that you are evaluating. STATEWIDE STANDARDS 11 AAC 112.200. Coastal Development Standard: (a) In planning for and approving development in or adjacent to coastal waters, districts and state agencies shall manage coastal land and water uses in such a manner that those uses that are economically or physically dependent on a coastal location are given higher priority when compared to uses that do not economically or physically require a coastal location. (b) Districts and state agencies shall give, in the following order, priority to (1) water-dependent uses and activities; (2) water-related uses and activities; and (3) uses and activities that are neither water-dependent nor water-related for which there is no practicable inland alternative to meet the public need for the use or activity. (c) The placement of structures and the discharge of dredged or fill material into coastal water must, at a minimum, comply with the standards contained in 33 CFR Parts 320 - 323, revised as of July 1, 2003. Evaluation: (a) How is your project economically or physically dependent on a coastal location? Why are you proposing to place the project at the selected location? This project is sited at a coastal location because that is where the water source is for this hydroelectric project. Hydro projects generally are near the coast because of the amount of head needed to create pressure to turn a hydro turbine and also because it is nearer the market for the electricity, generally found along the Alaska coastline. (b) Evaluation of development priority. (1) How is the proposed project water-dependent? Explain. It is a hydroelectric project which requires water. (2) How is the proposed project water-related? Explain. It is a hydroelectric project which requires water. (3) If the proposed project is neither water-dependent nor water-related, please explain why there is not a practicable inland alternative that meets the public need for the use or activity. Explain. (c) DCOM defers to the United States Corps of Engineers (USACE) to interpret compliance with the referenced standards. If you plan to discharge or fill waters of the US, have you applied to the Corps of Engineers for the appropriate authorization? We will be applying to the COE. State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management Consistency Evaluation 8/15/2008 Page 11 of 18 11 AAC 112.210. Natural hazard areas. Standard: (a) In addition to those identified in 11 AAC 112.990, the department, or a district in a district plan, may designate other natural processes or adverse conditions that present a threat to life or property in the coastal area as natural hazards. Such designations must provide the scientific basis for designating the natural process or adverse condition as a natural hazard in the coastal area, along with supporting scientific evidence for the designation. (b) Areas likely to be affected by the occurrence of a natural hazard may be designated as natural hazard areas by a state agency or, under 11 AAC 114.250(b), by a district. (c) Development in a natural hazard area may not be found consistent unless the applicant has taken appropriate measures in the siting, design, construction, and operation of the proposed activity to protect public safety, services, and the environment from potential damage caused by known natural hazards. (d) For purposes of (c) of this section, "appropriate measures in the siting, design, construction, and operation of the proposed activity" means those measures that, in the judgment of the coordinating agency, in consultation with the department’s division of geological and geophysical surveys, the Department of Community and Economic Development as state coordinating agency for the National Flood Insurance Program under 44 C.F.R. 60.25, and other local and state agencies with expertise, (1) satisfy relevant codes and safety standards; or (2) in the absence of such codes and standards; (A) the project plans are approved by an engineer who is registered in the state and has engineering experience concerning the specific natural hazard; or (B) the level of risk presented by the design of the project is low and appropriately addressed by the project plans. Evaluation: (a) Describe the natural hazards designated in the district plan as they affect this site. (b) Describe how the proposed project is designed to accommodate the designated hazards. How will you use site design and operate the proposed activity to protect public safety, services and the environment from potential damaged caused by known natural hazards? No natural hazards are identified for this site. (d)(1) Describe the measures you will take to meet relevant codes and safety standards in the siting, design, construction and operation of the proposed activity. (d)(2)(A) If your project is located in an area without codes and safety standards, how is your project engineered for the specific natural hazard? Give the name of the appropriately qualified registered engineer who will approve the plans for protecting public safety, services, and the environment from damage caused by hazards OR (d)(2)(B) If the level of risk presented by the design of the project is low, how do the project plans and project design address the potential natural hazard? 11 AAC 112.220. Coastal access. Standard: Districts and state agencies shall ensure that projects maintain and, where appropriate, increase public access to, from, and along coastal water. Evaluation: Please explain how the proposed project will maintain and, where appropriate, increase public access to, from and along coastal water. A road already exists along the coast and to the lake. This project will not impact either the coastal road or access to the lake because the project will be below the lake in its outlet stream. A short road will be made into the diversion site. 11 AAC 112.230. Energy facilities. Standard: (a) The siting and approval of major energy facilities by districts and state agencies must be based, to the extent practicable, on the following standards: (1) site facilities so as to minimize adverse environmental and social effects while satisfying industrial requirements; (2) site facilities so as to be compatible with existing and subsequent adjacent uses and projected community needs; (3) consolidate facilities; State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management Consistency Evaluation 8/15/2008 Page 12 of 18 (4) consider the concurrent use of facilities for public or economic reasons; (5) cooperate with landowners, developers, and federal agencies in the development of facilities; (6) select sites with sufficient acreage to allow for reasonable expansion of facilities; (7) site facilities where existing infrastructure, including roads, docks, and airstrips, is capable of satisfying industrial requirements; (8) select harbors and shipping routes with least exposure to reefs, shoals, drift ice, and other obstructions; (9) encourage the use of vessel traffic control and collision avoidance systems; (10) select sites where development will require minimal site clearing, dredging, and construction; (11) site facilities so as to minimize the probability, along shipping routes, of spills or other forms of contamination that would affect fishing grounds, spawning grounds, and other biologically productive or vulnerable habitats, including marine mammal rookeries and hauling out grounds and waterfowl nesting areas; (12) site facilities so that design and construction of those facilities and support infrastructures in coastal areas will allow for the free passage and movement of fish and wildlife with due consideration for historic migratory patterns; (13) site facilities so that areas of particular scenic, recreational, environmental, or cultural value, identified in district plans, will be protected; (14) site facilities in areas of least biological productivity, diversity, and vulnerability and where effluents and spills can be controlled or contained; (15) site facilities where winds and air currents disperse airborne emissions that cannot be captured before escape into the atmosphere; (16) site facilities so that associated vessel operations or activities will not result in overcrowded harbors or interfere with fishing operations and equipment. (b) The uses authorized by the issuance of state and federal leases, easements, contracts, rights-of-way, or permits for mineral and petroleum resource extraction are uses of state concern. Evaluation: (a) If this standard applies to your project, please describe in detail how the proposed project is designed to meet each applicable section of this standard: (1)The project corridor for the penstock and access road will be kept to as small a footprint as feasible to minimize impacts to vegetation and any terrestrial habitat. The operation of the project will be harmonized with the SSRAA hatchery at the bottom of the creek. (2) Project feature placement and operation will be reviewed by SSRAA to ensure the project will not impact their operations. (3) (4) (5) This project will require coordination with State and Federal agencies in order to get the necessary permits. (6) (7) Project facilities will be near the existing distribution infrastructure into Whale Pass, near the road system, and able to use a road into the SSRAA hatchery. This will minimize project impacts by using existing infrastructure as well as locating project features near the existing infrastructure. (8) (9) (10) (11) (12) With the SSRAA hatchery located near the project site, existing information will help determine how to avoid obstructing fish and wildlife movement through the area. The permitting process will also help determine what fish and wildlife movement is like at the project site. (13) Placement of the diversion structure below the lake, so that the lake level is not impacted, will protect any recreational use of the lake. (14) (15) (16) (b) List the authorizations for state and federal leases, easements, contracts, rights-of-way, water rights, or permits for State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management Consistency Evaluation 8/15/2008 Page 13 of 18 mineral and petroleum resource extraction you have applied for or received. We will likely have to apply for a ADF&G Habitat Permit, COE Individual Permit, DNR-Easement, a DNR water rights permit, and will need some agreement with the SSRAA hatchery. 11 AAC 112.240. Utility routes and facilities. Standard: (a) Utility routes and facilities must be sited inland from beaches and shorelines unless (1) the route or facility is water-dependent or water related; or (2) no practicable inland alternative exists to meet the public need for the route or facility. (b) Utility routes and facilities along the coast must avoid, minimize, or mitigate (1) alterations in surface and ground water drainage patterns; (2) disruption in known or reasonably foreseeable wildlife transit; (3) blockage of existing or traditional access. Evaluation: (a) If the proposed utility route or facility is sited adjacent to beaches or shorelines, explain how the route or facility is water dependent water related or why no practical inland alternative exits. This is a hydroelectric project, which is dependant upon the use of water that comes from Neck Lake, would use water from the lake outlet stream passing water through a pipe to the powerhouse and discharge the water back into the lake outlet stream above the SSRAA hatchery. Also, in order to get the most efficient pressure from the water source to generate electricity, the powerhouse must be placed as far down in elevation as is possible, hence this means usually being on or near a shoreline. (b) If the proposed utility route or facility is sited along the coast, explain how you will avoid, minimize or mitigate: (1) alterations in surface and ground water drainage patterns; The water that would normally drain from the lake will instead pass through the pipe and either be discharged back into the outlet stream near its mouth, or nearby, so that the net effect is that the same water is still ending up in the marine water as it normally would. Ground water will be diverted, where necessary, around project features, and where necessary, catchbasins will capture runoff to filter out any sediment that may come of the site. Ground water drainage patterns will not be significantly impacted. Water in the outlet stream will at times spill over the diversion structure, but the bypassed reach of the stream is not anadromous habitat. The SSRAA hatchery does place fry in the lake, so an accommodation for their out-migration period would be made to project operations. (2) disruption in known or reasonably foreseeable wildlife transit; Disruption could occur during construction due to activity and noise. Project features will likely be installed to minimize impacts to wildlife movement where feasible and necessary. However, no known wildlife transits are presently known to exist. As mentioned above, fry are placed in Neck Lake by the SSRAA hatchery, so operation of the project would have to allow for their out-migration so that this is not impacted. (3) blockage of existing or traditional access. Blockage of existing uses of the area are not expected as project features should be either able to avoid or co- exist with current access. 11 AAC 112.250. Timber harvest and processing. Standard: AS 41.17 (Forest Resources and Practices Act) and the regulations adopted under that chapter with respect to the harvest and processing of timber are incorporated into the program and constitute the components of the program with respect to those purposes. Evaluation: Does your activity involve harvesting or processing of timber? Yes No X If yes, please explain how your proposed project meets the standards of the State Forest Resources and Practices Act. State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management Consistency Evaluation 8/15/2008 Page 14 of 18 11 AAC 112.260. Sand and gravel extraction. Standard: Sand and gravel may be extracted from coastal waters, intertidal areas, barrier islands, and spits if there is no practicable alternative to coastal extraction that will meet the public need for the sand or gravel. Evaluation: If your proposed project includes extracting sand or gravel from coastal waters, intertidal areas, barrier islands or spits, please explain why there is no practicable alternative to coastal extraction that meets the public need for sand or gravel. 11 AAC 112.270. Subsistence. Standard: (a) A project within a subsistence use area designated by the department or under 11 AAC 114.250(g) must avoid or minimize impacts to subsistence uses of coastal resources. (b) For a project within a subsistence use area designated under 11 AAC 114.250(g), the applicant shall submit an analysis or evaluation of reasonably foreseeable adverse impacts of the project on subsistence use as part of (1) a consistency review packet submitted under 11 AAC 110.215; and (2) a consistency evaluation under 15 C.F.R. 930.39, 15 C.F.R. 930.58, or 15 C.F.R. 930.76. (c) Repealed 10/29//2004, Register 172. (d) Except in nonsubsistence areas identified under AS 16.05.258, the department may, after consultation with the appropriate district, federally recognized Indian tribes, Native corporations, and other appropriate persons or groups, designate areas in which a subsistence use is an important use of coastal resources as demonstrated by local usage. (e) For purposes of this section, "federally recognized Indian tribe," "local usage", and "Native corporation" have the meanings given in 11 AAC 114.990. Evaluation: (a) Is your proposed project located within a subsistence use area designated by a coastal district? Yes No X If yes, please describe how the proposed project is designed to “avoid or minimize impacts to subsistence uses of coastal resources:” (b) If your project is located in a subsistence use area designated by the coastal district, provide an analysis or evaluation of its reasonably foreseeable adverse impacts to the subsistence uses. (c) No response required. (d) If your project is not located in a designated subsistence use area, please describe any subsistence uses of coastal resources within the project area. Please be advised that subsistence use areas may be designated by the department during a review. (e) No response required. 11 AAC 112.280. Transportation routes and facilities. Standard: Transportation routes and facilities must avoid, minimize, or mitigate (1) alterations in surface and ground water drainage patterns; (2) disruption in known or reasonably foreseeable wildlife transit; and State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management Consistency Evaluation 8/15/2008 Page 15 of 18 (3) blockage of existing or traditional access. Evaluation: If your proposed project includes transportation routes or facilities, describe how it avoids, minimizes, or mitigates (1) alterations in surface and ground water drainage patterns; (2) disruption in known or reasonably foreseeable wildlife transit; and (3) blockage of existing or traditional access. 11 AAC 112.300. Habitats. Standard: (a) Habitats in the coastal area that are subject to the program are (1) offshore areas; (2) estuaries; (3) wetlands; (4) tideflats; (5) rocky islands and sea cliffs; (6) barrier islands and lagoons; (7) exposed high-energy coasts; (8) rivers, streams, and lakes and the active floodplains and riparian management areas of those rivers, streams, and lakes; and (9) important habitat. (b) The following standards apply to the management of the habitats identified in (a) of this section: (1) offshore areas must be managed to avoid, minimize, or mitigate significant adverse impacts to competing uses such as commercial, recreational, or subsistence fishing, to the extent that those uses are determined to be in competition with the proposed use; (2) estuaries must be managed to avoid, minimize, or mitigate significant adverse impacts to (A) adequate water flow and natural water circulation patterns; and (B) competing uses such as commercial, recreational, or subsistence fishing, to the extent that those uses are determined to be in competition with the proposed use; (3) wetlands must be managed to avoid, minimize, or mitigate significant adverse impacts to water flow and natural drainage patterns; (4) tideflats must be managed to avoid, minimize, or mitigate significant adverse impacts to (A) water flow and natural drainage patterns; and (B) competing uses such as commercial, recreational, or subsistence uses, to the extent that those uses are determined to be in competition with the proposed use; (5) rocky islands and sea cliffs must be managed to (A) avoid, minimize, or mitigate significant adverse impacts to habitat used by coastal species; and (B) avoid the introduction of competing or destructive species and predators; (6) barrier islands and lagoons must be managed to avoid, minimize, or mitigate significant adverse impacts (A) to flows of sediments and water; (B) from the alteration or redirection of wave energy or marine currents that would lead to the filling in of lagoons or the erosion of barrier islands; and (C) from activities that would decrease the use of barrier islands by coastal species, including polar bears and nesting birds; (7) exposed high-energy coasts must be managed to avoid, minimize, or mitigate significant adverse impacts (A) to the mix and transport of sediments; and (B) from redirection of transport processes and wave energy; (8) rivers, streams, and lakes must be managed to avoid, minimize, or mitigate significant adverse impacts to State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management Consistency Evaluation 8/15/2008 Page 16 of 18 (A) natural water flow; (B) active floodplains; and (C) natural vegetation within riparian management areas; and (9) important habitat (A) designated under 11 AAC 114.250(h) must be managed for the special productivity of the habitat in accordance with district enforceable policies adopted under 11 AAC 114.270(g); or (B) identified under (c)(1)(B) or (C) of this section must be managed to avoid, minimize, or mitigate significant adverse impacts to the special productivity of the habitat. (c) For purposes of this section, (1) "important habitat" means habitats listed in (a)(1) – (8) of this section and other habitats in the coastal area that are (A) designated under 11 AAC 114.250(h); (B) identified by the department as a habitat (i) the use of which has a direct and significant impact on coastal water; and (ii) that is shown by written scientific evidence to be biologically and significantly productive; or (C) identified as state game refuges, state game sanctuaries, state range areas, or fish and game critical habitat areas under AS 16.20; (2) "riparian management area" means the area along or around a waterbody within the following distances, measured from the outermost extent of the ordinary high water mark of the waterbody: (A) for the braided portions of a river or stream, 500 feet on either side of the waterbody; (B) for split channel portions of a river or stream, 200 feet on either side of the waterbody; (C) for single channel portions of a river or stream, 100 feet on either side of the waterbody; (D) for a lake, 100 feet of the waterbody. Evaluation: (a) List the habitats from (a) above that are within your proposed project area or that could be affected by your proposed project. Wetlands, stream (b) Describe how the proposed project avoids, minimizes, or mitigates impacts to each of the identified habitat(s) in section (a) above. Wetlands will be avoided, when possible, otherwise impacts will be mitigated by keeping any corridor through wetlands to a minimum, using Best Management Practices to keep sediment from reaching wetlands or streams; the lake outlet stream would be dewatered part of the time, but unless fish habitat is found there it will have a minimal impact; the fry put in Neck Lake by the SSRAA hatchery will require some adjustment to operations to allow them to out-migrate at a certain period in time. (c) No response required. 11 AAC 112.310. Air, land and water quality Standard: Not withstanding any other provision of this chapter, the statutes and regulations of the Department of Environmental Conservation with respect to the protection of air, land, and water quality identified in AS 46.40.040(b) are incorporated into the program and, as administered by that department, constitute the exclusive components of the program with respect to those purposes. Evaluation: No response required. 11 AAC 112.320. Historic, prehistoric, and archeological resources. Standard: (a) The department will designate areas of the coastal zone that are important to the study, understanding, or illustration of national, state, or local history or prehistory, including natural processes. (b) A project within an area designated under (a) of this section shall comply with the applicable requirements of AS 41.35.010 – 41.35.240 and 11 AAC 16.010 – 11 AAC 16.900. Evaluation: (a) Have you contacted the State Historic Preservation Office (SHPO) to see if your project is in a designated area State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management Consistency Evaluation 8/15/2008 Page 17 of 18 of the coastal zone that is important to the study, understanding, or illustration of national, state, or local history or prehistory, including natural processes? SHPO will be contacted to determine if the project site will require further investigation via an archaeologist. (b) If your project is within an area designated under (a) of this section, how will you comply with the applicable requirements in the statutes and regulations listed in (b)? Affected Coastal District Enforceable Policies Evaluate each applicable district enforceable policy using a format similar to the one you completed above for the State Standards. District enforceable policies are available at 5http://alaskacoast.state.ak.us/. If you need more space for an adequate explanation of any of the applicable district enforceable policies, please attach additional pages to the end of this document. Applicable District Plan(s) City of Thorne Bay Enforceable Policy: 2: Energy Facilities Evaluation: This coastal district does not have enforceable policies related to energy facilities. Enforceable Policy: 5.1: c) Within the 50-foot buffer, water-dependent structures and access to such structures may be allowed. Evaluation: Because this is a water-dependent project and it will be necessary for structures to be within the 50-foot buffer of the outlet stream, this project would be allowed under this enforceable policy. Certification Statement The information contained herein is true and complete to the best of my knowledge. I certify that the proposed activity complies with, and will be conducted in a manner consistent with, the Alaska Coastal Management Program. ___________________________________________________ ____________________________ Signature of Applicant or Agent Date Note: Federal agencies conducting an activity that will affect the coastal zone are required to submit a federal consistency determination, per 15 CFR 930, Subpart C, rather than this certification statement. ACMP has developed a guide to assist federal agencies with this requirement. Contact ACMP to obtain a copy. This certification statement will not be complete until all required State and federal authorization requests have been submitted to the appropriate agencies. State of Alaska, Department of Natural Resources, Division of Coastal & Ocean Management Consistency Evaluation 8/15/2008 Page 18 of 18 Project Description: Please provide or attach a brief description of your project including the planned work, any effects to coastal uses and resources and how your project is being designed to avoid, minimize and mitigate those effects. Please see the attached project description. Project Area: Please provide or attach a map of your project location and your proposed work. (Including nearest community, the name of the nearest land feature or body of water, and other legal description such as a survey or lot number.) Nearest Community: Whale Pass Nearest Waterbody: Neck Lake and its outlet stream and the marine waterbody of Whale Passage Legal Survey Description: T66S, R79E, Section 35, CRM, Petersburg (A-4) quadrangle. SCHEDULE Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3PHASE I: ReconnaissancePHASE II: Resource Assessment, Feasibility Analysis, Conceptual DesignTopographic MappingConceptual DesignEnvironmental SurveysGeotechnical InvestigationsPHASE III: Final Design and PermittingPermit Application PreparationPermit Application ProcessingFinal DesignPHASE IV: ConstructionMobilizationAccess RoadIntakePenstockGenerating Equipment ProcurementPowerhouseUpgrade Transmission LineTesting and Start-UpLEGEND: <-- Procurement and off-site fabrication <-- On-site constructionNECK LAKE HYDROELECTRIC PROJECTDESIGN AND CONSTRUCTION SCHEDULEQ420082012201320142011 LETTERS OF SUPPORT RESUME’S … … … … … COST WORKSHEET   Renewable Energy Fund Round 4 Project Cost/Benefit Worksheet   RFA AEA11-005 Application Cost Worksheet Page 1 7-21-10 Please note that some fields might not be applicable for all technologies or all project phases. The level of information detail varies according to phase requirements. 1. Renewable Energy Source The Applicant should demonstrate that the renewable energy resource is available on a sustainable basis. Annual average resource availability. 1,000 MWh annual hydroelectric output Unit depends on project type (e.g. windspeed, hydropower output, biomasss fuel) 2. Existing Energy Generation and Usage a) Basic configuration (if system is part of the Railbelt 1 grid, leave this section blank) i. Number of generators/boilers/other 3 ii. Rated capacity of generators/boilers/other 330 kW combined iii. Generator/boilers/other type Diesel iv. Age of generators/boilers/other 15 years v. Efficiency of generators/boilers/other 11.3 kWh/gal b) Annual O&M cost (if system is part of the Railbelt grid, leave this section blank) i. Annual O&M cost for labor $23,000 ii. Annual O&M cost for non-labor $1,000, excluding fuel 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] 306,000 kWh sold (2008) ii. Fuel usage Diesel [gal] 25,000 gal (2008) Other iii. Peak Load 63 kW iv. Average Load 49 kW v. Minimum Load 35 kW vi. Efficiency 11.3 kWh/gal vii. Future trends Stable, use of electricity may increase with less expensive rates 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                                                              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 4 Project Cost/Benefit Worksheet   RFA AEA11-005 Application Cost Worksheet Page 2 7-21-10 3. 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] 124 kW b) Proposed annual electricity or heat production (fill in as applicable) i. Electricity [kWh] 1,000,000 kWh max., 300,000 kWh w/current load ii. Heat [MMBtu] c) Proposed annual fuel usage (fill in as applicable) i. Propane [gal or MMBtu] ii. Coal [tons or MMBtu] iii. Wood [cords, green tons, dry tons] iv. Other 4. Project Cost a) Total capital cost of new system $2,219,000 (est. Phase IV) b) Development cost $221,000 (est. Phases I, II, and III) c) Annual O&M cost of new system $20,000 (2009 est.) d) Annual fuel cost No fuel cost 5. Project Benefits a) Amount of fuel displaced for i. Electricity 25,000 gal/yr ii. Heat iii. Transportation b) Current price of displaced fuel $2.97/gal (2010), 3.75% escalation for 20 years c) Other economic benefits Not estimated. d) Alaska public benefits Reduced PCE ($4,000,000); reduced diesel emissions 6. Power Purchase/Sales Price a) Price for power purchase/sale N/A; AP&T is the public utility for this community 7. Project Analysis a) Basic Economic Analysis Project benefit/cost ratio 2.9 Payback (years) Not calculated GRANT BUDGET FORM Renewable Energy Fund Grant Round IV Grant Budget Form 7-21-10 Milestone or Task Phase III – Design and Permitting Anticipated Completion Date RE- Fund Grant Funds Grantee Matching Funds Source of Matching Funds: Cash/In-kind/Federal Grants/Other State Grants/Other TOTALS Permit application, processing, and field studies April 2013 $ 26,000 $ 7,000 Cash, labor & benefits $ 33,000 Final design April 2013 $ 64,000 $ 16,000 Cash, labor & benefits $ 80,000 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ TOTALS $ 90,000 $ 23,000 $ 113,000 Budget Categories: Direct Labor & Benefits $ 88,000 $ 22,000 Direct labor & benefits $ 110,000 Travel & Per Diem $ 2,000 $ 1,000 Cash $ 3,000 Equipment $ $ $ Materials & Supplies $ $ $ Contractual Services $ $ $ Construction Services $ $ $ Other $ $ $ TOTALS $ 90,000 $ 23,000 $ 113,000 Applications should include a separate worksheet for each project phase (Reconnaissance, Feasibility, Design and Permitting, and Construction)- Add additional pages as needed Renewable Energy Fund Grant Round IV Grant Budget Form 7-21-10 Milestone or Task Phase IV Construction Anticipated Completion Date RE- Fund Grant Funds Grantee Matching Funds Source of Matching Funds: Cash/In-kind/Federal Grants/Other State Grants/Other TOTALS Construction management December 2014 $ 66,000 $ 16,000 Cash, labor & benefits $ 82,000 Mobilization October 2013 $ 108,000 $ 27,000 Cash, labor & benefits $ 135,000 Access road January 2014 $ 44,000 $ 10,000 Cash, labor & benefits $ 54,000 Diversion structure April 2014 $ 427,000 $ 106,000 Cash, labor & benefits $ 533,000 Penstock August 2014 $ 184,000 $ 45,000 Cash, labor & benefits $ 229,000 Powerhouse October 2014 $ 555,000 $ 139,000 Cash, labor & benefits $ 694,000 Tailrace October 2014 $ 105,000 $ 24,000 Cash, labor & benefits $ 129,000 Transmission facilities October 2014 $ 291,000 $ 72,000 Cash, labor & benefits $ 363,000 TOTALS $ 1,780,000 $ 439,000 $ 2,219,000 Budget Categories: Direct Labor & Benefits $ 220,000 $ 55,000 Direct labor & benefits $ 275,000 Travel & Per Diem $ 20,000 $ 5,000 Cash $ 25,000 Equipment $ 565,000 $ 135,000 Cash $ 700,000 Materials & Supplies $ 0 $ 0 $ 0 Contractual Services $ 295,000 $ 74,000 Cash $ 369,000 Construction Services $ 680,000 $ 170,000 Cash, labor & benefits $ 850,000 Other $ 0 $ 0 $ 0 TOTALS $ 1,780,000 $ 439,000 $ 2,219,000 Renewable Energy Fund Grant Round IV Grant Budget Form 7-21-10 Project Milestones that should be addressed in Budget Proposal Reconnaissance Feasibility Design and Permitting Construction 1. Project scoping and contractor solicitation. 2. Resource identification and analysis 3. Land use, permitting, and environmental analysis 5. Preliminary design analysis and cost 4. Cost of energy and market analysis 5. Simple economic analysis 6. Final report and recommendations 1. Project scoping and contractor solicitation. 2. Detailed energy resource analysis 3. Identification of land and regulatory issues, 4. Permitting and environmental analysis 5. Detailed analysis of existing and future energy costs and markets 6. Assessment of alternatives 7. Conceptual design analysis and cost estimate 8. Detailed economic and financial analysis 9, Conceptual business and operations plans 10. Final report and recommendations 1. Project scoping and contractor solicitation for planning and design 2. Permit applications (as needed) 3. Final environmental assessment and mitigation plans (as needed) 4. Resolution of land use, right of way issues 5. Permit approvals 6. Final system design 7. Engineers cost estimate 8. Updated economic and financial analysis 9. Negotiated power sales agreements with approved rates 10. Final business and operational plan 1. Confirmation that all design and feasibility requirements are complete. 2. Completion of bid documents 3. Contractor/vendor selection and award 4. Construction Phases – Each project will have unique construction phases, limitations, and schedule constraints which should be identified by the grantee 5. Integration and testing 6. Decommissioning old systems 7. Final Acceptance, Commissioning and Start-up 8. Operations Reporting Renewable Energy Fund Round IV RFA AEA11-005 Grant Budget Instructions Page 1 of 5 7-21-10 Grant Budget Instructions NOTICE TO GRANTEES Reimbursement to a Grantee under this program is on a cost reimbursable basis. In accordance with the terms of the grant a Grantee is required to submit certified requests for reimbursements that document commitments and expenditures and demonstrate meeting milestones identified in the grant. A proposed reimbursement schedule tied to completion of milestones must be identified in the applicant’s proposal. The Alaska Energy Authority (“AEA” or “Authority”) will n ot approve a reimbursement schedule that does not reflect costs or commitments tied to the accomplishment of milestones identified in the grant. The final reimbursement schedule is subject to negotiation and will be incorporated into the grant agreement. The Authority may authorize a percentage of grant funds, up to 20% depending on the type of grant, as an advance reimbursement at the start up of the grant. The Authority may also withhold up to 20% of the total grant subject to completion of the project and submission of final reports and other documentation that may be required by the grant. A Grantee is required to account for and document all expenditures of grant and matching funds including documentation of expenditures on any advanced reimbursement. All requests for reimbursement are subject to audit by the Authority. The Grantee is also required to comply with 2.AAC.45.010, the State Single Audit regulations. 1. Budget Form Information concerning the proposed grant budget needs to be provided on the Grant Budget Form. The Grantee must tie their budget request to the proposed milestones they propose in their application. Examples of milestones for each project phase are included with the budget form and in Section 2 of the RFA. For the purposes of determining potential cash-flow and a reimbursement schedule Grantees should use the form to identify the proposed date that the milestone would be met, the anticipated amount of grant funds to be expended to meet that milestone, and the amount and type of matching resources they intend to apply to that milestone. The bottom part of the form includes the allowable Budget Categories and is intended to be a summary of types of cost for each phase of the grant. 2. Allowable Costs Allowable costs for a grant include all reasonable and ordinary costs for direct labor and benefits, travel, equipment, supplies, contractual services, construction services, and other direct costs identified that are necessary for and incurred as a direct result of the project. Grant Budget Instructions Renewable Energy Fund Round IV RFA AEA11-005 Grant Budget Instructions Page 2 of 5 7-21-10 A cost is reasonable and ordinary if, in its nature or amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the costs. Allowable costs under this grant include all reasonable and ordinary costs for direct labor & benefits, travel, equipment, supplies, contractual services, construction services, and other direct costs identified and approved in the Project budget that are necessary for and incurred as a direct result of the Project and are consistent with the requirements of the grant agreement. A cost is reasonable and ordinary if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the costs. Allowable costs are only those costs that are directly related to activities authorized by the Grant Agreement and necessary for the Project. The categories of costs and additional limits or restrictions are listed below: a. Direct Labor & Benefits Include salaries, wages, and employee benefits of the Grantee’s employees for that portion of those costs attributable to the time actually devoted by each employee to, and necessary for the Project. Direct labor costs do not include bonuses, stock options, other payments above base compensation and employee benefits, severance payments or other termination allowances paid to the Grantee’s employees. b. Travel, Meals, or Per Diem Include reasonable travel expenses necessary for the Project. These include necessary transportation and meal expenses or per diem of Grantee employees for which expenses the employees are reimbursed under the Grantee’s standard written operating practice for travel and per diem or the current State of Alaska Administrative Manual for employee travel. c. Equipment Include costs of acquiring, transporting, leasing, installing, operating, and maintaining equipment necessary for the Project, including sales and use taxes. Equipment owned by the Grantee is to be charged to the project at the monthly rates contained in the Data Quest Blue Book. The rates for equipment owned by the Grantee for less than a month’s duration are to be computed on an hourly charge determined by dividing the monthly rate by 176. Equipment rented by the Grantee can be charged to the grant at actual invoiced charge rates, subject to a maximum amount equal to the hourly rates contained in the Data Quest Blue Book. The Authority’s Project Manager must approve all equipment charge rates to be used by the Grantee. The Data Quest Blue Book is available to the AEA Project Managers and grantees may contact them for current allowable rates. Grant Budget Instructions Renewable Energy Fund Round IV RFA AEA11-005 Grant Budget Instructions Page 3 of 5 7-21-10 Subject to prior approval of the Authority’s Project Manager, costs or expenses necessary to repair or replace equipment damage or losses incurred in performance of work under the grant may be allowed. However, damage or losses that result from the Grantee’s employees, officer’s, or contractor’s gross negligence, willful misconduct, or criminal conduct will not be allowed. d. Materials and Supplies Include costs of material, office expenses, communications, computers, and supplies purchased or leased by the Grantee necessary for the Project. e. Contractual services Include the Grantee’s cost of contract services necessary for the Project. Services may include costs of contract feasibility studies, project management services, engineering and design, environmental studies, field studies, and surveys for the project as well as costs incurred to comply with ecological, environmental, and health and safety laws. f. Construction Services For construction projects this includes the Grantee’s cost for construction contracts, labor, equipment, materials, insurance, bonding, and transportation necessary for the Project. Work performed by the Grantee’s employees during construction may be budgeted under direct labor and benefits. Contracted project management or engineering may be budgeted under contractual services and major equipment purchases made by the Grantee may be budgeted under equipment. g. Other Direct Costs In addition to the above the following expenses necessary for the Project may be allowed. • Net insurance premiums paid for insurance required for the grant Project; • Costs of permits and licenses for the grant Project; • Non-l itigation legal costs for the Project directly relating to the activities; in this paragraph, “non-litigation legal costs” includes expenses for the Grantee’s legal staff and outside legal counsel performing non-litigation legal services; • Office lease/rental payments; • Other direct costs for the Project directly relating to the activities and identified in the grant documents; and/or • Land or other real property or reasonable and ordinary costs related to interests in land including easements, right-of-ways, or other defined interests. 3. Specific Expenditures not allowed Ineligible expenditures include costs for overhead, lobbying, entertainment , alcohol, litigation, payments for civil or criminal restitution, judgments, interest on judgments, penalties, fines, costs not necessary for and directly related to the grant Project, or any costs incurred before the beginning date of the grant as indicated on the signature page. Grant Budget Instructions Renewable Energy Fund Round IV RFA AEA11-005 Grant Budget Instructions Page 4 of 5 7-21-10 Overhead costs described in this section include: • salaries, wages, applicable employee benefits, and business-related expenses of the Grantee’s employees performing functions not directly related to the grant Project; • office and other expenses not directly related to the grant Project; and • costs and expenses of administration, accounting, human resources, training, property and income taxes, entertainment, self-insurance, and warehousing. 4. Match and Cost Sharing If the Applicant is providing a match, it is should be detailed either as a specific dollar amount or as a percentage of the total project budget. The type and amount of matching contributions should be discussed in the application under section two. Cost sharing or matching is that portion of the Project costs not borne by the Authority. The Authority will accept all contributions, including cash and in-kind, as part of the Applicants’ cost sharing or matching when such contributions meet the following criteria: • Are provided for in the Project budget; • Are verifiable from the Applicant’s records; • Third party costing sharing contributions are verifiable (with a letter of intent or similar document); • Are not included as contributions for another state or federally assisted project or program (i.e., the same funds cannot be counted as match for more than one program); • Are necessary and reasonable for proper and efficient accomplishment of the Project or program objectives; • Are allowable costs; • Are not paid by the State or federal government under another award, except for authorized by the State or federal statute to be used for cost sharing or matching; • Must be incurred within the grant eligible time period. Any match proposed with the application will be required in the Grant award and the Grantee will be required to document the use of the proposed matching funds or in-kind contributions with their request for reimbursement. Previous Renewable Energy Fund grants will not be counted as match. 5. Valuing In-Kind Support as Match If the Applicant chooses to use in-kind support as some; or, its entire match, the values of those contributions will be reviewed by the Authority at the time the budget is approved. The values will be determined as follows: • The value of real property will be the current fair market value as determined by an independent third party or a valuation that is mutually agreed to by the Authority and the Applicant and approved in the grant budget. • The value assessed to Applicant equipment or supplies will not exceed the approved equipment rates or fair market value of the supplies at the time the grant is approved or amended. Grant Budget Instructions Renewable Energy Fund Round IV RFA AEA11-005 Grant Budget Instructions Page 5 of 5 7-21-10 Equipment usage will be valued based on approved usage rates that are determined in accordance with the item c. above. Rates paid will not exceed the fair market value of the equipment if purchased. Rates for donated personal services will be based on rates paid for similar work and skill level in the recipient’s organization. If the required skills are not found in the recipient organization, rates will be based on rates paid for similar work in the labor market. Fringe benefits that are reasonable, allowable, and allocable may be included in the valuation. Transportation and lodging provided by the Applicant for non-local labor will not exceed the commercial rates that may be available within the community or region. 6. Grant Disbursements Applicants are reminded that they must request disbursement of grant funds in the form and format required by the Authority with appropriate back-up documentation and certifications. This format will be provided by the Authority. The back-up documentation must demonstrate the total costs incurred are allowable, and reflect the amount being billed. Documentation must include: • A summary of direct labor costs supported by timesheets or other valid time record to document proof of payment; • Travel and per diem reimbursement documentation; • Contractor or vendor payment requests; and • Invoices. Payment of grant funds will be subject to the Applicant complying with its matching contribution requirements of the proposed grant. Payment of grant funds will be made by AEA to the Grantee within 30 days of receipt of a properly completed, supported, and certified Reimbursement Request.